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View Full Version : Need Help Interpreting My (Unusual?) Demographics!


Anonymous
10-27-2007, 03:58 PM
I'm considering building a new 'mat within the growing commercial area around an 18 month-old Walmart Supercenter. There's no rental space available, but nearby commercial land is. I have a 12 page Claritas demographic report given to me by my local Ipso distributor. It's entitled "Pop-Facts: Demographic Snapshot Report", with 1,3, and 5 mile radius circles.

My wife and I are newly-minted empty-nesters, and are looking for something to work at together, now that we are finished raising our kids (we think we did a great job). We have no experience whatsoever in the Laundromat business, but I have some business experience (auto sales), and a lifetime of equipment maintenance experience, including domestic laundry equipment, plumbing, electrical, electronics, and computerized automated postal equipment. I'm still employed as an electronics technician with the Postal Service, and plan to retire from that in about 5 years.

She has years of experience as a laundromat customer, and has lots of insight on what makes a good vs. a lousy laundromat. She also is very good at managing people, and has many connections with people of Mexican heritage who we would employ, and who we feel would make excellent and dependable hired help.

We would be interested in developing a high quality Wash & Fold service as much as possible. I think that busy, working families who want to spend time with children would really go for that. The street I'm looking at property on is very easy access from all directions.

I'm in a satellite community of nearly 80,000 immediately outside of a larger city of several hundred thousand. This small city I'm in has only 1 laundromat, on one side of town, and we and our Walmart are on the other side of town, with NO laundromat. The traffic counts on the 2 major arteries that crisscross at Walmart were over 20,000 vehicles each per day, BEFORE Walmart opened. Since then, I estimate the traffic has nearly DOUBLED.

Here's the issue: there are VERY FEW APARTMENTS. Owner occupied housing is 83.9%, renter occupied is 16.1%, the majority of which are single familiy rental houses. Multi-unit apartments represent 8.45%, mobile homes in outlying area, 2.7% of total housing units.

Other miscellaneous: household income below $50,000 is 34.5%, $50-100,000 is 46.8%. There are lots of young families with children. 71.3% white, 36.3% hispanic (hispanic IS "white", but the statistic gets muddled), 3.6% American Indian, 3% black. Average age is 35, age 25-34 is 15.2%, 35-44 is 15.18%, age 1-24 is 36.9%.

The laundromat on the other side of town is about 3600 sf, and does a fairly brisk business, it's not particularly well kept. It's the furthest one out of the 7 or 8 'mats with the same owner. The rest of his are in the large adjoining city.

I will have to put everything I own on the line, and strain to qualify for the approximately $800,000 I'll need to buy the lot, develop, build, and equip. The distributor enthusiastically claims the area badly needs another laundromat, but HE wants to sell equipment, and therefore is biased.

Any constructive input here by you veterans of the trade will be GREATLY APPRECIATED. Does it look like a probability of success???

brianbb
10-28-2007, 05:37 AM
I would be very careful if I were you. Industry wide only 5% of homeowners use a Laundromat. Of the renters, only 30% of them are what are considered core laundromat customers as well. Another other things you should consider in your decision.

One, is that in many cities a new Laundromat is assessed hefty sewer hookup fees for each washer. These fees can be from $500 to as much as $10,000 per washer. You should check with the building and planning department in your city to make sure you don't have big fees.

Brian

Gatorlenny
10-29-2007, 08:14 AM
Don't do it! If you do anything at all, try to buy the existing mat. It will have an existing revenue stream, you can clean it up how you like, and go from there.

pete f
10-29-2007, 08:27 PM
Do I read correctly there only 1 laundromat for a small town of 80,000 people?
How far away is the existing mat from where you are looking?
What is the number of rental units within 1 mile?

Anonymous
10-31-2007, 12:41 PM
The one mile radius of the report is actually not centered on my proposed ‘mat location, and doesn’t even enclose it. I did it this way because I expect most of the business to come from a direction further away from the large hub city. It will be the closest ‘mat for all of these people, and they will pass it on their way to and from that city. The direction farther out from the 5 mile circle is uninhabited desert.

The proposed location is somewhat inside one side of the 3 mile circle, toward the big city. Within that circle, which is outside the only other ‘mat, there are supposed to be 238 “units” in buildings of 3 to 19 units each.

The 5 mile circle increases the number of multi-housing units in buildings of 3 to over 50 units each to a total of 2249 units, some of which are condos, and most of the condos are close to the existing ‘mat.

The existing ‘mat is just within the 5 mile circle, and about 3 miles away from my location. It is, however, on a distinctively different arterial road, or “spoke” of traffic, and the vast majority of traffic to and from the big city on that spoke, and the spoke where I am, doesn’t cross over. Right now, very likely much of his business is crossing over from my side of town. There aren’t really many apartments close to him, either.

I thought of possibly doing some sidewalk surveying of shoppers in the area, or “intercept interviewing” as the marketing industry calls it. If done intelligently, I wonder if it could accurately reveal if there’s a strong market for a ‘mat with WDF in that same area where they shop. Anyone ever done this?

Anonymous
11-01-2007, 02:40 PM
There are VERY FEW APARTMENTS within a mile, about 50. There are very few near the other 'mat, too, but it seems to work. The other 'mat is about 3 miles away, but it's in a distinctively separate part of town.

What I'm trying to say, is, are there any 'mats anywhere in the country in areas of few apartments? Doesn't the low income, lot's-of-kids thing count for anything? About half of the thousands of single family homes are small, cheap, old, and run-down.

And, I'm sorry, but I'm not showing the name of my city & state in case my competitor or someone nearby (thinking about expansion) uses this forum.

COME ON, GUYS OR GALS, PLEASE TALK TO ME!

Boxer
11-01-2007, 03:38 PM
NO!!! This is why no one is answering you NO!!! "capital no NO!"

You bulid it and fund it for the next guy to gets it for a song.

Have you seen the other Mats in action? Are they over flowing?

Come on here's some tough love.

I could be wrong.

Silent Roo
11-13-2007, 09:20 PM
Here is the thing....

You have good demographics. Not Great. Here is my suggestion.

Build a stripmall/ Combo unit. You will have the Square footage turning profit for you and the laundry will pay it's own bills. Too often in this industry owners expect the laundry to pay 3-4 people, the bank, the equipment, the rent and the salary. If you have the ability to be 3 of the 4 you do well. If you are 1 of the 4 you do not.

A wash/ Car wash/ Tanning Salon would do well there. I have seen many people be VERY successful with a 4-5 store Strip where they are only one and the owner. The other 4 store pay everything and they live rent free.

It would be difficult to stick build a building and be profitable any time soon if you own 100% of the lot for your self.

Palmyra Jim
11-20-2007, 04:46 PM
Reading I found said 40% rental population within a 5 miles radius. It is misleading because 40% around my location (rural location) is nothing compared to a city's 40%...

As mentioned earlier, I am 2 out of 4 and the budget will be tight. I do not expect much for about 5 years. I would agree, used and established is better-smaller investment, history of customers who know where you are.

Good luck.