Why Competing on Price can Kill Your Coin Laundry?
A price-cut is a very common strategy in the laundry business, but it can do more harm than good. This is not sustainable because laundry customers want more than just cheap service. Here are 3 crucial reasons why you need to differentiate your business on more than just pricing for long-term success:
The price trap
You may see an increase in customers after a price cut, but how does this affect your operation in the long-term? Lower prices mean lower margins. This makes it harder to recover your equipment investments, especially for small laundry business owners. You may resort to cutting corners to keep the business afloat, and this may affect your service standards. Bigger laundry chains have deep pockets to survive on cheaper prices. Hence, it will always be a losing game for small players to compete on pricing.
Customers want more
Cheaper price is not the only reason customers choose a coin laundry. They also want convenience, cleanliness, safety, reliability, and comfort. Some customers would not mind paying a little more for air-conditioning, free WiFi, child-friendly corners, comfortable seating, and CCTV security. Others choose a shop because they like the scent of the detergent, there’s a coffee vending machine, the Instagram-worthy interior design, or the owner is friendly.
A community centre
Many coin laundries are becoming an inexpensive place for the customers to hang out. Create a space to serve as a connecting point for the neighbourhood. This is a great way to build trust and customer loyalty. Sponsor local events, partner with nearby cafes or convenience stores. Offer promotions for students and apartment residents in the vicinity. Once your business has earned a reputation as an anchor in the area, you would not have to rely on price cutting to get customers.
Competing on price may work for the short-term. If you want to play the long game in the laundry business, this is not the best path to take. Focus on creating the best experience for your customers to earn their loyalty. PLE Laundry Equipment Sdn. Bhd. is passionate about supporting laundry business owners with innovative laundry solutions. Contact us at 016–262 2965 or 603–5633 6405 for more information today.
