Whether you’re running a one store wash, dry & fold, or a multi-store laundromat with pick up and delivery, there are some fundamental business basics that never change. And knowing your numbers is one of them. Your metrics give you essential insight into the health of your business, they let you know what’s working well, and alert you to the things that aren’t. They can help you identify new opportunities, spot trends and even unlock new revenue streams. So of course, it makes sense to track them. But it's one thing knowing that you want to track your metrics, it's another thing to make sure you’re tracking the correct ones. To avoid getting overwhelmed by data it’s essential to identify the metrics that matter most to your business. These will vary from business to business based on things like business size, your business model, your customer make up and your overall business goals. In this blog, we take a look at the core metrics every laundromat owner should be tracking, how to measure them and why they’re important to your business.
Orders Per Day
Let’s start at the beginning. Before you even get into your revenue per day and the many other metrics that you can track, you’ll need to understand the total number of orders that your laundromat is processing on any given day. Any change in the number of orders in a day is indicative of a change in demand - a steady increase in orders per day suggests your marketing efforts are working. Whereas a decline indicates that either customers are unaware of your service, or something is putting them off visiting you. This information is vital for future planning and decision making. Everything from hiring of staff to planning promotions is influenced by the number of orders you process in a day.
Gross Revenue: The Financial Overview
Gross revenue represents the total income your laundromat generates before any deductions such as salaries, cost of sales etc. It's the sum of all service payments received, as such it’s a vital indicator of the health of your business. You should track gross revenue on a daily, weekly and monthly basis in order to get both a snapshot of your performance and to also understand the longer term trend. Over time this will allow you to understand the ebb and flow of your business, and better plan any promotional activity.
There are a number of ways in which you can track this but by far the easiest is to use a laundry POS system like CleanCloud. Not only will this allow you to streamline processes, it will help to reduce the inevitable errors which come with tracking on pen & paper or spreadsheets and provide you with real time insights into your business.
Revenue by Service Type: Diversified Earnings Insight
In addition to your gross revenue, you’ll want to understand your revenue by service type. For example how much revenue is driven by your wash dry fold business vs your pick up and delivery services. This gives you more granular insight into your business, allowing you to really drill down into which areas are over or underperforming. From here you can make strategic decisions about your business, for example if you’re running one PUD route but you see that PUD revenue is growing, you may decide to launch a second route. If after some analysis you see that self service is dropping off, you may choose to invest in marketing your wash dry fold service more heavily.
Again, a POS solution can help more easily access these insights. While a retail POS solution may help you track your overall revenue, if you’re getting more granular with your data, you’ll want to explore how an industry specific POS like CleanCloud will help you better segment, track and analyze your revenue.
Turnaround Time
If you’re running a wash dry fold or pick up and delivery service, understanding your turnaround time is key. Turnaround time is the time it takes from when a customer drops off their laundry to the point when it is ready to collect, or it is delivered back to them. Why is turnaround time so important? It’s a crucial indicator of operational efficiency and because it reflects the level of responsiveness to your customers needs it's also likely to be a good indicator of customer satisfaction.
Monitor and record the start and completion times for each service to understand your base, from there you can analyze the factors that play into this and look for ways of optimizing the process. For example, you may want to allocate one specific staff member to washers, and one to dryers, or you might find it more efficient to allocate one staff member to a set number of machines at any given time. There are many ways to optimize for efficiency, but it all starts with basic tracking.
Staff Performance
When you start out you may initially be very focused on tracking ‘hard’ metrics like revenue, and number of orders processed, but the most successful laundromat owners know that keeping a close eye on staff metrics is just as important. When we talk about tracking staff metrics what we’re really talking about is understanding the efficiency and effectiveness of each member of staff in relation to their role. Why is that so important? Because the performance of your staff directly impacts on other key metrics such as customer satisfaction, turnaround times and ultimately revenue.
So what should you be measuring? There are a number of indicators you can track, and as with any metric you need to weigh up which are the most important to you, but common indicators include:
- Weight processed
- Items cleaned
- Amount of credits and discounts applied
- Order edits
- Customer feedback scores
Tracking these metrics on pen & paper can quickly become challenging, but with a robust point of sale system like CleanCloud you can track all of these metrics and more and compare them by day, week or month.
Number of Repeat Customers
As any business owner knows, attracting a customer is only half the battle. You then need to work on retaining them. Understanding the split between new and returning customers is essential to growth. Attracting new customers is time consuming and expensive, it’s far more cost effective to get an existing customer to make a repeat order, and lower costs are better for business. Using a POS like CleanCloud you can easily recognize repeat customer transactions over time, and even set up specific loyalty programs to incentivize repeat visits.
Customer Satisfaction
Last, but not least you should be regularly tracking customer satisfaction. Customer satisfaction reflects how happy customers are with your services, and indicates their likelihood to return. Why is this so important? Well, to put it bluntly without customers, you won’t have a business! There are many ways of gauging customer satisfaction but the most common include customer surveys, comment cards or feedback forms and encouraging online reviews. Not only will these provide valuable insights and feedback, but they can also be used as positive testimonials which can attract new customers.
On track for success
By meticulously tracking these key metrics, you’ll gain a better understanding of your overall business health, and will be in a position to make informed, and strategic decisions for future growth. But tracking takes time, and it’s easy to get overwhelmed, that’s where a laundry specific POS comes in to play, allowing you to more accurately track the data, analyze the results and optimize your processes.
Discover how CleanCloud can help you better run and grow your business. Sign up for a no-obligation 14 day free trial, or book a call with our sales team to discuss your specific requirements.