February 4, 2019 | Category : Business tips, |
To guarantee the success of its laundry owners and managers, Speed Queen supports its investors every step of the way. Together, we choose the best location for the premises, the most suitable size for the laundromat, the name and types of machine to be installed, the store design, and of course we develop a sound business plan on which to base the operations. In a business plan, calculating forecast turnover is vital and here, we aim to provide some insight.
The laundry market
The laundry market is on the up thanks to the opening of more and more self-service laundries, in both Europe and other countries.
Speed Queen is at the forefront of this global laundromat revival: equipment and automation are two of the pillars on which our success rests. The third pillar being the increasing demand for our services: professional cleaning, record drying time, treatments for moths and stains, waterproofing, primer, complimentary services such as the sale of detergent, etc.
Calculating turnover: the formula
Turnover is the total of items billed by the company, and serves as the prime indicator of sales performance. It can be calculated per month, per quarter, per year…It is equal to the total sales (excl. tax) and is calculated as follows:
Turnover = Sales price X quantity sold
When forecasting future revenue, we speak of provisional turnover. Provisional turnover is equal to the set or anticipated unit sales price, multiplied by the number of anticipated sales. This should form part of your business plan.
The turnover of a laundromat
The turnover of a laundromat depends mainly on the number of wash/ dry cycles ‘consumed’ and the price of each cycle. Additional sales will be factored in too:
- Sales of detergents
- Optional drinks and snacks
- Complementary services (such as stain removal or moth repellent treatments)
The turnover of an optimally located laundromat ranges on average from €30,000 to €40,000 over the first year, and over €60,000 after around 4-5 years in operation. This is, however, only an estimate—you should base your expectations on the projected calculation that Speed Queen generates on a case by case basis.
How can you increase your turnover?
To increase your turnover, you can adjust sales volume and price, as well as the number of products or services on offer. Sales volume, the primary driver of growth, will increase in line with the reputation of your laundromat. Advertising helps, but the quality of Speed Queen services is what guarantees customer satisfaction and consolidates the customer relationship in the long term.