WASHING MACHINE FUNDAMENTALS:

The water saving potential of a “front-loading” washing machine is best

demonstrated by the following example: Consider a cup full of water and you
have an example of a “top-loader” (vertical axis washing-machine). Consider
a cup that is one-half full, visualize it on its side with a lid on it and you have
an example of a “front-loader” (horizontal axis washing-machine).
“Front-loaders” offer two advantages over “top-loaders”: as per the
preceding cup analogy, they use less water (especially hot-water) and they
offer washing action that is superior to the "agitation" of “top-loaders”. In a
properly loaded “front-loader” laundry is carried to the top of the tub, from
which it falls and thuds to the bottom of the tub. The greater the tub
diameter, the further the fall, the harder the thud, the better the washing
action.
The traditional advantage of “top-loaders” over "front loaders" is that "top
loaders" spin more water from the clothes. This, as it requires considerably
less effort to spin a load on the vertical axis than on the horizontal. The
average “top-loader” will get up to 600 RPM on spin-out. As “top-loaders”
generally develop ten to twenty percent more spin-out speed than “front-
loaders”*, they develop more centrifugal force, thus forcing more water from
the clothes.
*A new technology permitting electronic manipulation of drive motor speeds has recently placed
this differentiation in flux. I greet this issue in my "Vital Info Pack",
Because all of the tub weight (including the water and the laundry) is
supported solely by bearings at the rear of the tub, “front-loaders” are three
or four times more expensive to manufacture (and therefore to purchase)
than “top-loaders”.
DRYING FUNDAMENTALS:
Due to the cost of fuel, drying is the less profitable side of a coin-laundry
operation. Depending on variables such as the types of washing machines,
as discussed above, and the presence of extractors, as discussed below,
revenue from dryers will normally total about 30% to 40% of coin revenue.
Laundry-mat dryers are configured to utilize one of three different heat
sources: steam, electric, or gas (natural gas or propane). Gas is by far the
most common configuration.
As to gas dryers, there are two basically different configurations. The
distinction is based upon the flow of hot air to the laundry (vertical vs.
horizontal). In a vertical airflow dryer, the stove (where the flame burns) is
located above the tumbler. Hot air is then forced down over the laundry
(absorbing moisture from the laundry) and is expelled.
In a horizontal or “axial” airflow configuration (frequently associated with
“stack” or one on top of the other dryers) the stove is located below the
tumbler and the hot air is forced across the axis of the tumbler (usually back
to front). Compared to an equivalent capacity vertical unit, “axial” airflow
dryers are more energy efficient*. However, as the rate of airflow to the
clothes is usually reduced by some 20% (when compared to an equivalent
capacity vertical unit), the “axial” units take longer to dry
*This because two sources of inefficiency associated with vertical configuration dryers are
mitigated in the “axial” configuration: Firstly, although vertical units are designed to labor
against heated airs' natural tendency to rise, the above the tumbler placement of the stove does
permit some heat to escape through the top of the unit. Secondly, due to cross-flow against the
tumbler (rather than with it – as in “axial” units), some heated air blows-by the tumbler, rather
than passing through it (and the laundry).
Stay away from dryers that re-circulate warm air. They save fuel, but dry
slowly and will be a source of dissatisfaction to your coin-laundry customers.
EXTRACTORS:
A coin-laundry extractor is a free-standing centrifuge that can squeeze water
from laundry by spinning it at great speeds. Some models can attain speeds
of over 1500 RPM. If heavy items such as towels or dungarees are squeezed
in an extractor before being placed into a dryer, drying time can be cut by
one-half. As reduced drying time translates to a need for fewer dryers,
extractors are a common sight in laundromats located in New York City,
where real estate (and therefore rental space for dryers) is very expensive.
Here follow some points on extractors:
They must be loaded properly (otherwise, items can spin out of the basket).
Accordingly, their introduction requires a commitment to doing customer
orientation and training in their use.
There are two basic types of extractor: direct-drive and indirect-drive.
Indirect drive units have a transmission and friction resistance braking
system; they are considerably more maintenance intensive than direct-drive
models, which have a three-phase electric motor directly driving the basket -
and by reversing electrical polarity, direct-drive models brake using electrical
energy rather than friction resistance.
Extractors are inherently dangerous (a heavy steel basket spinning at
tremendous speeds). Although recent models incorporate several safety
features (directed mostly at insuring that the lid properly closes and remains
closed during operation), extractors have, at least in the past, been a source
of serious injury and considerable litigation.
LEASE:
If you lose your lease, it is very expensive to set-up in a new location:
machine pad construction (far more expensive if there is a basement);
sufficient gas supply for dryers; lawful waste-water egress; plumbing
(including sufficient water supply); three-phase and single-phase electrical
layouts; dryer venting system; flooring, ceiling, and counter space.
Accordingly, laundermats need to have a long and easily assignable lease.
What makes one laundromat succeed and another fail?

A key factor is location, location, location. Our carefully trained site-selection experts
will look at the demographics of an area to assist entrepreneurs in finding the best
possible location for a laundromat. A demographic study determines the number of
people moving in and out of an area, the size and spending patterns of households,
and the ratio of homeowners to renters. Traffic patterns in the area will help to
determine how successful a store might be and parking availability is also important to
future success.
Appearance is another key factor in a laundromat's success. The design and
maintenance of your facility can keep your customers satisfied or cause you to lose
business to the competition. At Mac-Gray our consultants have extensive expertise in
designing and renovating various types of laundry facilities. Our technicians are
experts in the mechanical infrastructure of coin laundries and will work closely with you
- from site design to completion of the facility. We specialize in laundry room
renovations such as decor, venting, plumbing, gas, wiring and equipment layout for
optimal efficiency.

What are the advantages of owning a coin laundry over

other types of businesses?

• Relatively minimal capital investment.

• No franchise fees.
• Minimal labor commitment (customers do most of the work).
• No accounts receivable with minimal inventory (no spoilage factors).
• Cash business.

How much time would I have to devote to the business?

Usually 10 to 15 hours per week.

If I decide to invest in a coin laundry, how much capital and reserve should I
expect to have?

Approximately 25% of the total store costs are the minimum required down
payment. Total store costs vary depending on the size, location, type of
building and utilities in the building. Your net worth should be at least two
times (2x) the total loan amount if applicable.

How much will it cost to equip a store with washers and dryers?

Investors who are thinking about opening a laundry store often ask this question
and the answer is very difficult to determine. Location, demographics of the
area, layout of the site, size of the equipment, water heaters, water storage
tanks, plumbing, exhaust venting, etc., will all contribute to the total cost of
the store. Mac-Gray provides a feasibility study that will address a specific
location and provide a more accurate equipment package cost.

What is "Drop Off" service? (This applies to fully attended stores only.)
This is a service offered to laundry store customers where the customer drops off
their laundry for the store attendant to wash, dry, and fold. Normally there is a
ten-pound limit and the charge for this service will range from 65 cents to 95
cents per pound.
If you have any additional questions, please call Mac-Gray at 1-800-MAC-GRAY
(1-800-622-4729) for more information. You can also send us an email and
one of our experienced consultants will contact you.

What kind of return can I expect from my investment? Are there tax benefits?

Capital invested is usually recovered in less than three years, but remember the
success rate of your business depends on how well you manage it. Tax
benefits are commensurate to your personal yearly income. If you are in the
30% personal income tax bracket or higher, the tax benefits are extremely
good. The rewards for an entrepreneur are income and tax benefits.

What are impact fees and how do I find out if they will affect my new laundromat?

Impact fees are imposed by the City as a condition of, or in connection with,
approval of a development project that requires connecting to the City's
water, sewer or irrigation system. Not all cities impose impact fees. To find
out if your city has established impact fees call your city council or go to your
city's Web site.