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Content about Pricing

December 27, 2012
Is Experience Interfering with Greater Success?

SAN FRANCISCO — Isn’t it reasonable that the way the industry was run when you learned the business may need an update?

SAN FRANCISCO — Often, your biggest asset can also be your biggest obstacle. Your positive experience that led to past success can blind you to the current opportunities that exist with new approaches.

Some examples might be:

December 20, 2012
The Structuring of Dry Cleaning Pricing

TORONTO — The cost of production starts at the cleaner’s front counter

TORONTO — There are dry cleaners that are confused about what to charge for their services, where that pricing structure places their operation within the industry, and how the consumer perceives them.

It is important to explain what goes into the pricing structure used when charging customers for their dry cleaned items. There are a number of ways to do this.

A cleaner could play a continuously looped video at the counter that illustrates how a garment is processed (including as many different processes as are used), place signage at the counter, or use various advertising mediums.

The cost of production starts at the cleaner’s front counter. When a customer drops off clothes, they should consider what system is in place to create the invoice and receipt they receive and how the cleaner identifies their items so what they brought in will be returned to them.

Proper identification includes a complete description of each article, indicating the type of item, color, label identification, and any stains or tears that may be on the garment at the time it was marked in.

October 13, 2011
To Share or Not To Share?

SAN FRANCISCO — Why would you want to share information with employees? When times are tough, you keep the bad news, tight cash flow and potential layoffs all to yourself. When times are good, you want more of the money for yourself, repay your own debts, make up for the tight times and then think about growing and reinvesting again. On the other hand, we’ve all heard that sharing information with employees is a good idea. What’s the scoop?

THE HERE AND NOW

There may be times when growth is spectacular or, alternatively, sales drop dramatically, but neither of those conditions dominates right now. The more common situation today is to have a few days or weeks that are better than the last two years because of your sales efforts. If those efforts fall off, volume falls off a bit.

September 7, 2011
Sales by Any Other Name

SAN FRANCISCO — Sales, revenue, income … whatever you want to call it, it’s the one thing you always want more of. It’s an easy thing to want but a hard thing to get, particularly these days. How do you close the gap?

The only way to get something so big is to break it down into its components. Even drycleaning is more diversified than you would first expect.

On one level, revenue has two components—piece count and price. Multiply the number of total pieces by the average revenue per piece to get total revenue. On another level, there are a variety of product lines, each with its own number of pieces and unique pricing strategy. On still another level, there are various distribution methods—including dry stores, activated plants, retail or commercial routes—used to receive the revenues.

Each perspective has the ability to generate sales and must be independently and jointly reviewed in the hopes of building total, company-wide sales.

August 3, 2011
Industry Observations: Don’t Sell Out Yet

PEMBROKE, Mass. — I meet lots of drycleaners who are looking to sell. There’s nothing wrong with that, but there is a time to sell and a time not to sell. This is a time not to sell. Wait a few years, and it should be a better market. You might even double your price if you wait. Here’s why.

The current economic situation is quite tenuous. Now, nobody is ever really sure what’s going on, but the last few years have been particularly iffy. In 2008, the economy almost collapsed. We have not experienced such a crisis since the Great Depression. Government tinkering averted a complete meltdown, but the fear of that almost-catastrophe lingers.

The economic situation is looking up. Major companies such as Microsoft, Intel and Exxon have billions in their tills. The stock market has recovered, and the future looks promising. If you’d invested $100,000 in the market at the depth of the recession, you might have $140,000 now.

July 16, 2010
When Cost Cuts Go Too Deep

CHICAGO — When times are tough, we cut back. We cut everywhere we can. We cut where we should have cut before. We cut in places we shouldn’t cut for long-term viability, but the need for short-term cashflow forces us to do so.

When other businesses do the same thing, it’s easy to justify. Many large companies are cutting costs in customer service, and whether or not they could achieve better results for less money, we’ve been lulled into accepting poorer customer service.

August 24, 2009
Solvair Slashes Price of System Ownership

NAPERVILLE, Ill. — Solvair LLC has announced a new pricing structure for its Solvair Cleaning System. The new pricing structure lowers the initial capital investment for drycleaners from $150,000 to $80,000, with additional reductions in installation costs.

July 23, 2008
Sales Down? Stay the Course

Oh no! Sales are way down this week! Sales were down last week, too! You should probably issue some coupons right away, since customers are getting tight with their money and aren’t spending it on drycleaning.

Have you felt this pang of anxiety over a few weeks or a month in which sales didn’t meet expectations? You have a deep-seated need to take action — any action — to stem the tide, communicate with customers, lower prices, increase discounting or something.

April 16, 2008
Upcharges for The Upscale

Years ago, I wrote an article about pricing for profit. Now, I think it would be relevant to review pricing for designer garments. There’s a psychology behind wearing designer garments, and there should be a psychology in accepting them for cleaning, too.

Standard practice is to accept designer garments at the “regular” price. But people don’t wear them in the same way as other garments, nor do they purchase them at a “regular” price.