Today’s episode explores the idea behind laundromat franchises. A common question that new investors often have is whether they should strike out on their own or if they should become a franchisee. This growing trend isn’t for everyone, but it perfectly suits some investors and today’s guest, Jim Williams of WaveMAX, comes on the show to shed some light on laundromat franchising.
The laundromat franchise model has been around in various forms for a while, but some believe that all of the proper tools are in place to make laundromat franchises scalable, manageable, and economical. Jim talks through reasons he believes the franchise model is the way to go for many owners.
This episode is jam packed full of great insight. Even if you’re not currently a franchisee or if you have no desire to own a franchise, there is still a TON of information in this episode that will help you run your business more efficiently and retain more profit.
In this episode, Jim and I discuss:
- Why franchises never caught on and why they might see more success now.
- Why a new owner should consider a franchise.
- How technology is evolving in the laundry industry and the implications on the laundromat owner.
- The 4 categories of changes in the laundromat industry.
- The complete process to owning your own franchise laundromat.
- Systems that make franchise laundromats more effective and efficient.
- Who is a good candidate for a franchise laundromat.
- The importance of providing value to the customer.
- Getting the right location for your laundromat.
And much more!
You definitely don’t want to miss this as aerospace industry veteran turned laundromat franchisee shares his business wisdom to help you succeed faster in your business!
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Episode Transcript
hey everyone what’s up it’s jordan with
the laundromat resource podcast this is
show number 27 and i am pumped
that you are here today because today
we’re delving into
a world that i knew very little about
before
this interview with jim williams from
wave max we are delving into the world
of
laundromat franchises and i get asked
this question
all the time about is it worth it to do
laundromat franchises should you do it
shouldn’t you do it what are the pros
what are the cons who is it for
i asked jim all of these questions today
and more
and even if franchising is not what you
are uh excited about it’s not what
you’re doing or maybe you already own
some
and you’re not looking to buy a
franchise there is a ton of value today
with jim
he brings a lot of wisdom and in fact
one of the things that i
really loved about this episode is we
talked a lot about technology
in the industry right now and obviously
if you’re using a franchise model
technology plays a huge role in that
um and and i think technology is one of
those things that
is making franchising a little more
accessible a little more possible in our
industry so we talk
a lot about technology in a way that i
think will benefit everyone so make sure
you tune into this one you’re not going
to want to miss it i want to point out t
donnelly on the forums this week he had
an interesting thing that he did that i
thought would benefit some of you guys
he went out and did a direct mail
marketing campaign
for laundromats for sale in his area
and he got such a great response that he
has
more leads of laundromat owners who want
to sell then he knows what to do with
and he’s trying to figure out if there’s
a
way to uh you know spread the wealth in
a way that kind of benefits him also
similar to like wholesaling or something
and if that is something that you know
something about or maybe
you want to connect up with him because
you’re looking for a laundromat
hey you know head over to the forums go
help t donnelly out and
give him some of your wisdom also if
you’re brand new around here
you got to go to laundromat resource dot
com slash forums again
link is in the show notes or if you’re
on youtube description below
go introduce yourself we’re growing by
like 8 to 10 people
every single day growing like weeds
right now it’s been
very very cool to see but man we got to
start getting to know each other because
that’s where the real power is so head
over to those introduction forums
click on it introduce yourself let
people know who you are where you are
and where you’re at in your journey and
then go say hi to someone else who’s
already done that
just so cool to get to know people it’s
one of my favorite things with what i’m
doing here
and i want you to be a part of that
so man today’s episode is awesome the
last few episodes have been
incredible if you haven’t listened to
those yet
go back and check them out and i already
have lined up and recorded the next
couple episodes and they
also are mind-blowing so if you haven’t
done it yet
make sure you subscribe whether you’re
on a podcast player you’re on youtube
whatever the case may be make sure you
subscribe you don’t want to miss this
there’s tons
tons tons of value coming your way
and let’s speaking of which let’s just
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[Music]
well hey jim thanks for coming on the
show today how you doing
i’m doing very good how are you doing
i’m doing awesome awesome i’m really
really
excited to talk to you today because you
have a very unique
uh perspective on the industry and i get
asked questions about this all the time
so i’m really really
excited to hear uh you know straight
from the horse’s mouth uh all about
franchising in laundromats so but before
we
get into that can you tell us a little
bit about yourself who are you and maybe
how did you
make your way to this strange industry
sure um i’ve been in and out of the
several industries my whole
career usually at a executive level and
i
uh i bought a franchise finally uh
well i don’t know about 15 years ago or
so uh
and uh it was good for a few years i got
tired of it and sold it to one of the
employees
uh kind of slipped back into aerospace
just to have something to do for a while
and uh
after about eight years of that
six-month contract
i just i had enough had to walk away and
again
and so i started looking for another
franchise
and uh longer maths weren’t on the radar
at all i was i was looking more at the
construction products and finance
products and that’s
more of what my background is and uh
running running operations running
departments and things so
i was looking for something i had a few
employees not too many
and uh and i was probably more in the
financial area but
uh one of these uh
one of these uh franchise coaches found
me
and asked if they could
[Music]
ask if they could uh interview me and
propose some ideas that they might have
so i said sure i’m pretty pretty much
have my mind made up but
uh i don’t i don’t mind looking at other
things so there’s an interview process
and
somehow one of the things on there was a
laundromat
and my wife had asked me about owning a
laundromat a few times in our
32 34 whatever
years of marriage and uh i’ve always
kind of
didn’t want to be a laundromat owner i
it was
you know in industry and i had
pretty respectful positions and stuff i
just i didn’t think that was a small
business i wanted
um but as luck would have it i got into
a pretty bad car accident a couple years
ago
so i had narrowed my search down about
four or five items
for and i started really digging into
them
the more i dug into the wanderman
business i was doing research in the
background i wasn’t
i wasn’t doing any uh any directly with
a wave max chip but i was looking into
into the industry itself and i called
pretty much every business that was for
sale at that time couple years ago
in orange county in l.a county around me
to uh to see uh
if it would be something for me and i i
discovered pretty quickly
that if you’re running it right the
margins are very high
uh that was exciting because the margins
were higher than
you know pretty much everything else you
could get on one or two laundromats and
make
the amount of money you think you need
to make or you could have
seven or eight subways and that means
lots of lots of employees lots of
problems lots of management yeah lots of
problems is right yeah yeah
just so uh i kind of like this
semi absentee owner approach
so i started investigating a laundromat
fan
franchises only to find out there are
zero
or there were zero um so
i was interested in why all of a sudden
there’s a land
laundry franchise there hadn’t been
before that was my main probe
next and uh what i discovered
was the reason there weren’t
franchises before us because it was a
cash business
and cash businesses still make good
franchises you can’t
you can’t track the sales and you can’t
be sure that all of the franchisees are
going to report their sales accurately
so
uh enter technology into the industry
it hasn’t stopped since technology has
hit this industry and
and now we’re seeing it the same way
we’re seeing technology
in everything so so technology is what
has
made the wavemax be able to be a
franchise
and i know there’s a second one out
there that might have a couple of stores
open
i think that’s it i really don’t know of
any there’s a lot of folks that are
trying to sell licenses or
sell a process or something but as far
as a real franchise product that
it’s well thought out and and uh
you know helps you from womb to tomb
there really aren’t
uh really any choices out there
besides what max and uh and so
i went on the discovery day and i met
the owner and i met the business
development executive who had done
several other franchises um
so uh they had a decent track record uh
the
the ceo uh mike roberts he’d been in
franchising for many years on the
operation side of it
he decided to get out and open a
laundromat
for similar reasons i guess um
and five years into it he said you know
we can franchise this
i know but he came up with a proprietary
way
before technology to
determine uh how much volume was going
through the stores
so that’s what they launched it on but
shortly after that
technology came into play and and you
can just track everything now
on it so so that’s how i got into the
that’s how i got started on it very cool
well let me back you up for a second
what i mean you were looking at all
kinds of different franchises
when you know before you found wavemax
so
what what is it about the franchise
model in general not specifically
laundromats necessarily but
franchise model in general that that
attracted you
well when you’re starting a small
business you make a lot of mistakes at
first you got to learn
um and having run operations for many
years i’ve
found it’s always easier to pledge your
eyes than to invent
you can improve the process and usually
do improve the process but
it’s always nice to let somebody else uh
you know
lay the groundwork for it
and make all the mistakes that you don’t
want to
make yourself that are so expensive to
make yeah
there’s nothing scientific about the
laundry business and you can call up any
broker and
get you started in it but there’s
definitely advantages
uh to uh to doing it through a franchise
that
you can’t realize uh on your own
yeah i love that okay so you’re looking
for
different franchise through different
franchise models you stumble on
laundry mats you start to dig in a
little deeper and uh
you know because of assuming injuries
from the car
the car wreck had kind of limited you or
is that
yeah i was i was in a easy chair for
about six months so
yeah yeah i uh i had a lot of time to
be on a phone and do internet searching
and
and uh you know put put spreadsheets
together and pro formas and stuff
so um and and it
really got boiled down to two and i
honestly thought i was going the other
direction
and then i i met the owners of both
both great uh both great people
but i uh i i connected better
with with the fran with the uh
wavemax team um and i like the fact that
you can run a laundromat with very few
employees
involved of your own time if you if
that’s what you choose to do
yeah and the other one is going to be
the opposite a lot of
ways a lot of your time
yeah well i mean i think that’s that’s a
big part of the appeal of the industry
in general is the you know the good
returns
the lack of you know a lot of management
and you still do have to obviously
manage
your business but uh it’s you know it’s
a lot less than
normal regular businesses uh or other
businesses i should say
um yeah so wow okay so you met the wave
max guys and
what was that what was that process like
once you decided okay i’m going to jump
into owning a laundromat through this
this franchise what
what is the process it goes pretty fast
you go through the contracts and sign
them and
and you pay a franchise fee and off off
you go you know first thing it is
is uh meet with meet with the folks that
are supposed to be coaching you
uh in my case i bought a an entire
territory
so i’m not all of southern california um
so i’ll be the one helping develop that
area
for uh the company uh and i i liked it
because it was a
it was a brand new concept meaning
franchises in
in longer events and they’re in the
water map business
and southern california has the most
laundry mass in the country
yeah um in the prime territory or like i
did i was able to make a pretty decent
deal
to get in and uh so so
um so i thought i just gotta you know
sit back and sell some franchises and
let the checks roll in but the more i
got into it the more
i really realized this industry is
changing
and and i want to be part of the change
i think this industry needs to change
i think you’re uh you’re
um open 24 hour nobody there watching
what’s going on
dirty insecure
[Music]
laundromats are a thing of the past
they’re all going out of business
every one of them um
and and what’s coming in
is um more professionalism a lot
it still can be mom and pop but
to survive now you have to
you have to have a clean store it has to
feel safe
you have to have security you have to
have nice
uh uh amenities inside the store
and or a nice ambiance inside the store
but it
it feels you know good because you your
customers are going there and they’re
spending a couple hours out of their day
um less now than they did before but
they’re spending time out of their day
to
uh you know to do their laundry every
single week or every other week
and it’s it should be a place that they
look forward to coming to not a place
that they dread
coming to so our stores always have an
attendant on duty
and we have a fold and fluff service we
have a pick-up and delivery service
and we have the self-service and they
come in do their own laundry
we don’t go overboard on on
[Music]
vending machines and things like that we
have been there for
uh so folks can grab a beverage and a
snack or whatever
play a game maybe but it’s not an arcade
approach it’s it’s a professional
operation
uh with with uh uniformed employees and
and uh and uh our
return rates very high in all of our
stores uh that are open
we’ve sold 100 franchises so far we’ve
got 17
uh 18 open for business
and we’ve got 20
22 or 23 uh currently in some stage of
opening
we’re opening one about every uh four
weeks
and then we’ve got a backlog of about 60
right now
um that are most of them are second and
third
stores that a frenchie franchisee has
purchased
um we got a couple of key markets that
we’re doing our most of our testing in
right now that’s
phoenix market uh dallas market denver
market
uh and knoxville tennessee
we’re doing some testing on the pickup
and delivery business and
and it’s it’s not like we’re reinventing
everything but we’re honing it
and we’re making it uh precise and
profitable
and and um we’re listening to the
customer giving the customer what
the customer wants uh and and the
customer’s changing
it’s it’s uh it’s evolving
now just because the drop off business
and because of the pickup and delivery
business
we’re seeing uh older folks and younger
folks both
uh coming into the into the mix now
where you know in the past it was mostly
the
you know 20 something through 40
something
or something that was a big hunk of your
business but
but uh the youngest generations now uh
my kids include it they don’t want to
wash their clothes so
they they call somebody up to come pick
them up at their door
you know bring them back folded like mom
used to do
exactly just replacing mom on that one
that’s
that’s replacing mom yeah
so i mean that’s that’s kind of what the
dynamic is now
[Music]
yeah i mean you just you said so much in
there that i think is so
so good i just want to touch on a couple
things and i have some like follow-up
questions for you
but i mean i love the mindset of hey
you know you can still be mom and pop
but you gotta up the level of
professionalism and i think that’s the
name of the game in the business right
now
is upping that professionalism you know
i think the days of
you know getting a store and
you know basically letting it run itself
and coming in collecting quarters and
basically running the
running the machines into the ground and
then trying to dump it you know at the
end i think
i think those days are are quickly
coming to a close
and you know now if you’re not
reinvesting into your business
then your business is probably going to
die it’s probably not going to survive
um and that’s what customers want too
right and those big you know nice new
stores that are
coming in everywhere they’re going to
start taking all the business from
the stores that don’t up their
professionalism don’t run it like a
like a actual business and so i love
that you’re
saying that i think that’s one of the
big recipes for success in our industry
right now is
up and up in that level of
professionalism keeping things clean
keeping things tidy
keeping machines running and keeping
customers happy
so i love i love that um you talked
uh you talked a lot about changes in the
industry do you
can can you talk a little more
specifically i mean you kind of mention
technology uh changing
are there any other changes or what
technology in particular
are you seeing that’s effective yeah
well um
i think i think he break the categories
into a couple
or three categories i guess if you want
definitely technical logical advances
uh uh for both the consumer and the
uh and the uh owner and then there’s
a management um aspects that benefit
both the consumer and the owner then
certainly there’s the
the economic factor and an environmental
factor
that that affects everybody
so um i’m not sure how which
attacks but i think the easiest might be
the environmental
yeah um so the newer machines
uh run much the cycle time is much
much smaller much shorter much shorter
cycle time so
uh that gets somebody in and out
of uh of the store very quickly
and the shorter cycle time uses less
energy so
we’re using less electricity less water
less gas
and we’re putting less uh polluted water
gray water down the animal sewer also
um so those are those are all really
positive
beneficial things that help both the
consumer and and the
uh and the owner as well as
as as everybody the environment the
community uh
benefits from uh from uh these
uh more efficient machines so um
i mean they’re they’re getting to the
point where uh you can literally do a
double load or triple load in 20 minutes
with some of our fastest machines and uh
we use electrolux as the brand that we
use
exclusively but you can get cycle times
on a wash in the dry down to 20 minutes
each
and so you can literally be sitting on
your couch
and then uh you got an hour breaking
your tv programming or whatever and
you can you can take technology look on
your smartphone
find out if the machine you like to use
is free
and then head on down to the laundromat
and uh you know 40 minutes without
folding and
you’re back home sitting on the couch
fill in your laundry while you’re
watching
the show you want to watch anyway so uh
it
it’s it’s not the three hour visit
uh to the laundromat anymore if you’re
if if your owners are keeping up on the
technology if they’re putting in the new
machines
and uh and we’re finding
with our new stores that that uh
i’m not sure there’s more people washing
laundry
but they’re they’re migrating to the to
the more efficient store
that the you know that has a nicer
ambiance makes them feel better
uh is well managed uh those kind of
things
they don’t have to if there’s a problem
there’s an attendant there to help with
it they don’t have to find a
number on the wall leave a message and
you know get their reporters back
someday
it’s taken care of right away um
[Music]
another way technology is really uh
making it better for the consumer
aside from the smart apps that you can
download on your phone
they tell you when your laundry is done
so you can put your laundry in and
go to the bookstore next door go to the
bar next door i don’t know what
budgie but whatever you want to do and
then it’ll tell you when you’re when
your load’s done you come back and
and and you’ve got that also for the
owners it helps out because i can
literally look on a phone and i could be
across the street or across the country
my employees don’t know where i’m at but
i can tell what’s going on on every
single machine
in that store and i have video camera
also so
so i know what’s going on in the store
so
as an owner you can literally run your
store
from your phone anywhere that you want
to run it
and if you’re app based only you’re not
even in there every
every other day collecting coins or
moving coins around you know
so uh um so there’s a lot of advantages
to the
to the newer technology uh with regard
to that
so you’ve got you’ve got reduced cycle
times you’ve got the app base that you
can do you can pay with the app
you can manage with the app you can run
reports with the apps
[Music]
the machines tell you every single penny
that goes through that thing and every
single refund that
that’s issued by the machine and and
um it and it tells you when it’s down
it tells you when it needs maintenance
it’s a heck of a lot easier than
you know then calling out the repair guy
and having him
look at your machine for after tell you
oh it needs the thousand dollar bearing
which you were hoping it wasn’t gonna be
the
you know so and then there’s waiting
lists for it so
that the technology’s just just uh
really changing the industry a lot um
yeah i mean i see that i mean that
that’s huge
we just had uh thomas landenberger on uh
you know an episode or two ago and he’s
in italy
with a he lives in in tuscany in the
tuscan
countryside with a laundromat in florida
and
you know just it’s incredible what
technology allows you to do
these days and i think that it’s about
time that our industry is catching up on
that technology and starting to utilize
it um but it really does open up a lot
of exciting
opportunities you know for us
yeah i i use my phone probably 90
of the time on the computer probably 10
percent time
i mostly use the computer when i want to
have a bigger screen for a
presentation or something like that but
outside that you can you can literally
do it all
with the phone yeah crazy
crazy so well you mentioned
uh just brief i mean you mentioned
economic change do you want to touch on
that
at all uh sure um
[Music]
uh well from a franchise standpoint
um you or i any of us
that wants to open up watermelon we can
call the local
distributor and they’ll take a meeting
with us and
we’ll show them the store we have and
then they’ll decide
how much equipment needs to go in there
and what i found
is usually they help you just pack it
full of equipment
that’s not really what the customer
wants it’s not really in your best
interest
um but
to be blunt they get compensated by some
equipment
right that’s how they make their money
you have an extra five machines
they fit uh looks decent in there but
you probably don’t need those extra five
machines or
or what have you so uh in our franchise
we look at
demographics and and
some algorithms that we have and we use
that to determine
[Music]
based on the population and the
car count and a few other things that we
use that we don’t disclose that
to determine how many machines we really
need in there so
if it’s a 30 by 30 or a 30 30 store 30
washers 30 dryers
um typically in that store you could
probably fit 35
37 washers and dryers we don’t do it we
give a little space
more to folding um
and and
we don’t worry about uh machine turns on
the machine
that’s what the they’re always trying to
sell you machine turns when you finances
machine turns
we don’t really care nobody should care
about what the machine terms are and
what you should care about
is this is your customer account growing
and are you providing a
good enough service to grow your
customer account um
but but back to the money part any of us
can go out there and
meet with a dealer and we can negotiate
a discount with them and
they may give us a 10 or 15 or 20
percent off depending on how many we buy
um and that sounds like a good deal
because these are expensive right
outfit of stores a half million dollars
worth of machines that
that’s that’s a lot of money um
but with our franchise we get a gigantic
discount north of 40
and no broker can touch that uh
at all so right out of the gate you know
we’re saving
tens of thousands of more dollars than
anybody else has
and our franchise can be financed up to
80
uh so you’re really coming out of pocket
with
much less than
much less than you typically do when
you’re working directly with a broker
and then our store design is relatively
standardized
so we have a designer layout that
that lays out the uh layout for you
and the machine count and whatnot and
now we
turn over to a number of different
architects that
that have the wave max feel down pretty
well
and uh um we have some very good looking
stores the newer ones
each store i think looks better than
last one because there’s just uh
something little more that we decided to
add
now that we didn’t have in the last
store uh and
and they really help a lot and they look
you know they look inviting
and they feel safe when you uh when you
go into them
um so you save money on the design you
save money on the build out
the whole thing is financed um if you
choose the red machines
which we do that’s part of our package
uh then you’re saving a lot of money
just in utility bills
shorter cycle times the machines are
smart enough now to
detect what the size of the load is and
use the right amount of water
use the right amount of spin washing
machines actually do part of the drying
process in the machine because because
using the right amount of water
when they go through the spin they can
they can be
you know lightly damp instead of wet
and then you throw them in the dryer the
dryer times much less also so
but the machines these days they have a
lot of
uh a lot of uh technology in it to help
assist manage the the energy and the
time
uh and those are important on several
different levels to everybody
yeah i mean i think that’s
i think it’s well put and it’s really a
good explanation of
what uh you know how it benefits you to
you know buy a franchise as opposed to
kind of doing it on
on its own because i mean i think that’s
one of the big questions i get a lot i
see it on different forums a lot
is why why go with the franchise model
and not just do it
on your own i’m guilty of it yeah
give it myself i i thought i could you
know
i was a professional procurement person
for many years decades and
and i know how to buy right i know how
to negotiate i’ve been like
well i can i can get as good a deal as
anybody can it’s not true you can’t
because i’m not buying 2 000 washing
machines this month i’m buying
30. yeah i mean manufacturer’s not gonna
give me the same discount
yeah you know as a company that’s
bringing them
hundreds and hundreds of washers a month
as opposed to
thirty thirty yeah right yeah i mean i
think the bulk discount is one
you know and you’ve mentioned already
kind of throughout just the different
systems that you guys
you know wave max has in place and uh
and how those kind of continue to get
better because it’s not
a single operator you know tinkering
with their system it’s multiple
operators
tinkering with their systems and
everybody kind of benefits from
that i’m assuming is that is that the
case yeah
that’s a good point i probably should
have brought it up with one of the
reasons i like franchises
and i discovered this when i owned my
last franchise
um the the
entrepreneur the the mike roberts he had
a great concept and he put it in place
and
and we follow the basic rules on it but
we’re continually improving the product
and we’re doing it because uh all of the
area reps like myself
they used to be called master
franchisees but that’s a nice title
yeah that’s kind of gone away now at
least in california you’re not even
allowed to
call it that anymore in your ftd but um
but the uh the other area reps they’re
they’re like-minded they’re
they’ve you know had a career and
they’ve we’re successful in it and
they have some that specialize in
advertising and some in development some
in marketing
and we get together every couple of
weeks and and
we talk about uh we talk about uh what
went well what went wrong
and what we’d like to see improve uh
every
every couple of weeks and i think
i’d say probably in last year every
single thing we have changed have come
from that
that group of folks uh
saying we’d like to see this change
presenting it to
uh to the uh ownership
and uh i let’s have a little coaching
here and there i can’t think of anything
that they
they really uh didn’t accept and
and for good reason because uh because
we’ve got a lot of talent
in the in the area rep pool that has a
lot of great ideas
they come from a lot of great companies
that that
taught them how to manage well and how
to operate well and
we don’t forget the stuff you bring it
with you when you come right
interesting that you share with other
franchisees so so the the
the camaraderie between owners is really
really important we do the same thing
for franchisees we have a franchisee
call
once a month and so any of the
franchisees
that are not area reps uh can get them a
call
and uh and ask the same kind of
questions
and if you have a stumbling block or a
question or a situation
put on our chat line and somebody has
the answer for you
it’s it’s right there you don’t have to
figure it out yourself
so it’s a huge benefit of
of uh franchising yeah
well can you do this for me if you
would uh let’s say that i am
in the market for a laundromat and i’m
interested
in buying a franchise what’s that can
you walk me through that process of
you know what it what is gonna happen
what do i need to do
what do you guys do to get me from hey
i’m interested to
okay i’m a franchisee and i’m throwing
open the doors to my
wavemax laundromat um
it’s a relatively straightforward simple
process
but uh they they uh
first thing we do is we share with you
what the real costs are that are
associated with it
um i
one of the brokers that i was dealing
with originally myself
before i made the call
was they were kind of just now i wasn’t
understanding what
the full amount of expenses were that i
was going to have to come up with
and then and uh and so they just kind of
give you the information you need to
know
to keep you on the hook we don’t we
don’t do that we’re more all up front
you know we’ll tell you right up front
your franchise fee is
for your first store is going to be 50
000 you’re gonna need another 150
000 in real cash that you’re gonna have
to
spend to get your store and your
equipment and get running and be able to
operate for the first
uh you know for the first three months
or so and
um and we tell them up front and then we
also say
you can’t open a store for 200 you can
open a store for 900 or 750 or
depending on where you’re at and how
much your rent is and and
and stuff like that but 750 is probably
750 800 probably what it costs in
southern california
to open up a franchise and have a nice
build out and have the security you need
have the right mix of machines um
and and the financing that we have in
place to to be able to do that
so so you know
if you have the half of that you’re not
gonna be able to open the store
and when we try to be upfront with
everybody let them know so
we we work on the finance part of it
first
and and for me that was a little
frustrating because you know i kind of
had this
idea of how much money i wanted to throw
into it
um but then there was the hidden
a hidden thing i never even knew about
until i bought this franchise which was
the
uh my 401k from my company that i had
worked at
uh in aerospace uh i was able to
use that money to buy my franchise
so rather than finance i was able to pay
cash or
for a with my 401k through rob’s program
but
uh wavemax helped walk me through that
process also they hooked me up with
with a vendor guidance financial
that helps you with the rubs process and
don’t ask me what rob
stands for but it has to do with your
role over turning it into a business
or a business basically so your 401k
goes from
the stocks that you were then and going
up and down and up and down every year
and never really increasing it
at a great rate just kind of losing
along to
you turn it into a laundromat and
whatever profit margin you can maintain
twenty percent thirty percent forty
percent
your wise high you know
what way higher than you were getting
with with your uh 401k
yeah with your mutual fund or your index
shot
yeah so um so we’re up front about
people about that and then we
we pretty much open our kimono to
use a cliche and and we let them ask any
question they want they can call any
franchisee they want and every
franchisee
pretty much will talk to them i haven’t
heard of one that wouldn’t
um and uh if they’re still interested in
going forward
after we use they usually have a talk
kind of like we’re having
today and i ask all these kind of
questions but if they’re still a nursing
going forward then
we send them the fdd for their state and
uh
a franchise disclosure document for
their
and then um we give him a couple of
weeks to read through it thoroughly and
then
we put him online with her his dev
executive and he answers
every single question form we give him a
copy of the contract up front too so
they
there’s no surprises so they can see
everything in one package
they they answer all the questions and
[Music]
and then if they want to move forward we
schedule a discovery day
where we actually show them some stores
we have some of our preferred vendors
come in and make a presentation um and
they’re
usually very interested in in how you
launch
the advertising campaign and
[Music]
how much does it cost and you make money
right away
and things like that so all that stuff
comes out in discovery day
and um we have if they
discovery day we usually have a pretty
good
[Music]
close rate people are pretty pretty
interested in the product after that
because
because our franchisees are very nice
the owners are
great um they
if there’s something important to you
they let you add it to the contract or
take it out of the contract
within reason um and uh it
it’s just a very comfortable
friendly family kind of
feeling and and um
i think my stress level in the last two
years has gone to like zero
from me well say no more yeah it’s
it’s won us all over right there yeah so
you know you’re your own boss they they
have a procedure you follow procedure
you make money
you don’t follow the procedure you don’t
make money it’s you know it’s like
everything else
um the franchise fee hasn’t got a bunch
of
extra stuff all buried in it that you
know six percent
they don’t you know grab a bunch of
other things and
throw it in there um you know some of
the branches i
looked at it was a seven percent
franchise fee and one percent
more for uh national advertising and
then you had to join your local
co-op advertising and by the time you’re
done one of the companies i looked at
as a as a new owner brand name company
i was gonna have to spend 50 000 my
first year
because of the market i’m in just for
advertising
because i had to join the pool and the
pool here in southern california
uses television and so
you know i had to pay my equal share of
that that that’s a lot of money for
you know your franchisee to suck up
and our company the initial package
actually comes from the manufacturer
because wavemax gets a rebate
based on the amount of uh sales that we
do and
that could keep money if they wanted to
at corporate but they
don’t they and 100 of that over to the
franchise
advertising company that we use and uh
that company puts the
that money toward their launch campaign
so
instead of you know spending 50 000 the
first year people spend four or five
thousand dollars
that’s a it’s a a huge difference
and palatable and they hit the ground
running with customers that come back
right oh so after that discovery day
is that like okay full steam ahead if
well you said
yeah we used to fly out to uh the
corporate
office in florida for it but with covet
here we
we’ve been doing that uh same will you
and i are talking today so we’ve been
doing a virtual one
and i attended my first virtual one
last week and it was very good i was i
was impressed it was actually
much better than what i had gone through
face-to-face face
um but technology again i know
it’s all around it you can’t escape it i
i i
you know i’d like to be a mountain man
just stuck up there and
plan but you can’t escape it if you’re
not in the mountains that’s for sure
yeah or just embrace it or deserve it i
don’t know but
at any rate yeah it’s all around us and
it was a very good
um a very good presentation and we had
really great feedback from it
um because because we had the
advertising vendor was there the
uh the equipment vendor was there the
uh construction vendor
was there so uh
we had folks talk about how you find
your location the right location
things like that so it it it answers the
questions that people have
uh in a very good presentation uh and
and we’re not a hard push sales company
if it’s not for you
it’s not for you if it is uh and you’ve
made it that far chances are
you wanna you wanna finish it out and
finishing it up from theirs
is really uh meeting with the executives
and
and having them answer any last
questions you might have
and then um signing the contract and
and then your area rep takes over with
you and
first thing you do is go look for
property so are you guys
building from the ground up are you
taking over existing ones and re-hauling
overhauling them or how do you how are
you doing that
yeah there’s a lot of different there’s
a lot of different ways to do it um
pretty much any way that
you can think of i prefer to take over
existing laundry mats or ones that have
been
but i do that mainly because of what
the conditions are in california for me
and it’s
usually environmental related or are
governmental related
so a lot of cities in southern
california have
impact fees that they require you
to pay per machine because you’re going
to be dumping a lot of
um a lot of grey water into the system
and our stores go through about 180 000
gallons
a month for a 30 30 store
so um there’s a lot of water going in
it’s less water than the equivalent
number of households
would be dumping in because they don’t
have as efficient machines by any
stretch
and and the cycle times are much longer
and they tend to do more loads at homes
more smaller loads than than doing one
or two loads in a laundromat
so um
so yeah is there can you give us
a little just like uh maybe like a
general glimpse of uh
any kind of like systems that are in
place
for the franchisee uh
you know to kind of help them either
manage their business or
or even kind of build their business or
i just know that
systems are a big reason that people get
into
franchises because like you said those
are all in place
and they’ve already made the mistakes
and they’ve created these systems
in order to eliminate those mistakes for
the franchisees and kind of fast-track
everybody
can you give us like a little bit i
probably glaze over that
but every step of the way is documented
so um you look for you look for real
estate
wave max will help you negotiate the
lease
with the landlord if you want them to
we’ve got
we’ve got in-house legal representation
that you’re welcome to
welcome to talk to uh if you want um or
you can use your own
uh and you get you get the lease sign
and then uh
first thing you do is you know you meet
with the city make sure that uh
you usually have a grace period in your
lease but you make sure that
the city doesn’t have any issues that
you haven’t already discovered
uh and make sure you can go forward with
it
and then the next thing we do is we
have a if there isn’t a set of as built
already done we have a
set of as built created uh and hand that
over to
the design team so they can do the
layout
and then from the lab we get the
equipment uh the
equipment specs then we hand that over
to the
architect who puts the wave max
flavor on it and and all these steps you
could use your own people if you wanted
to or you could
use you know the company’s arrangements
that they have
usually the company arrangements a
pretty good deal because of the volume
so from designer we hire
a general contractor we break ground
it takes about three months of
construction to
uh uh to get it if it was not
an existing laundromat if it wasn’t
existing longer man
it can cut 60 days out of that and the
reason being is the
the utility requirements right so
um unless it was a laundromat before
it’s not going to have a 2
inch water line coming in or three
line coming in depending on how many
machines you have that
you need to handle um it’s not going to
have uh
with that many machines we prefer three
phase
400 amp panel
usually that doesn’t exist and
uh and then the gas is not that big of a
deal because
we use uh tankless water heaters which a
lot of
of watermelons do not do that but uh
they’re very
very efficient and satisfactory we have
to uh a two unit system uh
to uh to heat the water um so
bring bringing all the utilities in is
expensive if it was a longer map
there’s no cost to bringing the
utilities in they’re already there
and we verify that up front and when i
say it’s expensive we’ve had quotes as
high as
two hundred thousand 000 to bring a
water pipe in
right we’ve had uh we’re in the wrong
business we should be bringing water
lines in
that’s crazy yeah usually it’s around 25
30 but even that’s
crazy yeah and if you have the if you
have the land uh um i’ve explored using
the uh
using holding tanks instead so i could
trickle feed the tanks overnight
with just a regular commercial water
line
and then i don’t have to worry about you
know bringing that in
um so we distribute
and we have a relationship with the
distributor of tanks also so we can do
we can do that approach um and then
so the water ones the usually the most
expensive one second one
is usually the impact fees um and
all over the country they charge impact
fees some of them are
as high as you know six thousand dollars
per washer
for impact fees let’s see it’s a
thousand ish
but you know that’s a lot of money that
you’re kicking out if you go with an
existing laundry map
those fees are already paid you’re just
you’re just taking over the laundromat
and you’re
upgrading the equipment so
you can usually uh you know avoid all
those costs
we have had success in one of the cities
in michigan
i believe it was then they wanted to
charge a very high
uh fee for um for it being a new store
the impact phase but we were able to
demonstrate
that machines that we use
use significantly less water than
than the previous generation of machines
and we were able to get a pretty decent
reduction in the impact fee based on
presenting that analysis but without the
help of the manufacturer we wouldn’t
we wouldn’t have been able to put that
together they had a lot
a lot of data we needed to generate
so anyway so you have your impact fees
you have your built
and then you you finally get built out
and then you have a
soft launch with your friends and family
and you put signs up and say we’re
opened and
and folks will um you know mosey on
in and then we have the grand opening
about a week after that
yeah we make sure everybody’s trained
right we make sure we have all the kinks
out of the
operation itself fun they’re everybody
get trained adequately
and then we have the the grand opening
with
you know balloons and banners and food
and we make a big deal out of it and
and coupons and in the neighborhood uh
usually reacts very favorably uh to
the grand opening and uh we keep
quite a quite a large number of the
folks that attended it
uh come back the
return rate’s very high on the on the
grand opening
so usually our stores uh since
a year ago october it’s been one year
now so
so for the last year our stores have
been launching their grand openings and
hitting the ground running on day one
with with profitability
and you know not not running in the red
[Music]
contributed to to a great marketing
program to
to uh good training and friendly people
and
and welcoming environment and and
treat people like you want to be treated
and and
they’ll want to do business with you yep
i mean it seems like that’s
that’s the recipe for success you know
in in this business and probably in most
businesses and
it’s as simple as that but it’s also
easier
said than done you know and i i think i
can see where the value would come from
in a franchise model of
of having you know good training
already in place and ways to implement
that in the most effective
ways and how that could you know kind of
shortcut your
shortcut your time to profitability and
to having a good experience because you
know profitability is one thing but if
you’re hating it
you know sometimes it doesn’t matter how
profitable you are you know it’s not
you know it’s not fun you don’t want to
do it for long so
and we sent our trainers to your store
they you train in your own store you
don’t go to a training center
um uh and
and uh and if you know the trainer
sees kinks in in the process they they
help you work it out right there
but it shouldn’t shouldn’t be too bad
because we’ve been holding
we’ve been holding the franchisee’s hand
as much as they want
the entire throughout the entire process
cool
i love that um i have a couple other
questions uh
you mentioned a couple times financing
do you guys do financing
through a third party lender is it part
of wave max how does that work it’s
through the manufacturer
themselves okay and the reason they
do it is because they help us finance
the equipment
and the build out and operating
capital for the first three months um
and the reason they do that and
they’ve just up the percentage up to 80
now and and sometimes higher if you’re
on the second or third store
but the reason they do that is because
we’ve
uh you know on a track record of success
now
so they haven’t lost any money on us
and uh and uh we pay a fair rate
and uh we get very good financing
and and uh they walk us through the
process
and a little bit um i don’t want to make
it sound like you can’t get financing
from your distributor because
distributors offer financing most of the
time
it’s just that you have to finance more
because you know
the discounts you get as um bear with me
one second here
the discounts you get are not as
as lucrative as they are with the deals
that we have in place
for franchising yeah awesome i i mean i
like that going direct
kind of to the source and getting your
financing
there uh let me ask you this who who’s a
good candidate for a franchise
uh you know there’s there’s lots of
kinds of people i talk to and i
you know i feel like i have a decent
idea of who’s a good good candidate but
maybe you could spell it out for me
who’s a good candidate
for this franchise i don’t know i think
i think people uh in laundromats they
they are like every reason you can
imagine but
most of them want to have a you know
better quality of life
because you don’t have to live at your
company
24 7 or 10 hours a day or whatever i
mean it
it’s literally a couple hours of work
if that’s as little as you want to do
and
and and you can you know you can have a
very successful honor not doing that
um you got to keep an eye on everything
you gotta
you have to uh you know make sure it’s
neat and clean yeah make sure it’s safe
to make sure your equipment doesn’t have
out of order signs on it
and you know things like that but it’s
just kind of like common sense as to how
to run it
on anybody that
wants to have a better quality life i
think as a good candidate for this
and sadly you have to have some money
to do it um
but um you threw at that that 200
reasonable amount
uh figure earlier is that is that a
general number is that
what you need yeah it’s not hard or it’s
not hard and fast it’s it’s
it’s based on it’s based on
one component is the franchise fee so
with wavemax if you buy one store it’s
49.95 i think for 995.
if you buy two the second one is half
price
and if you buy three the third one is 19
000 and and that’s the price
for the fee from there out um
[Music]
a lot of that goes to the to the broker
that
introduced you to the system uh and then
the rest of it
is actually you used to
help you get up and running you know we
use it for traffic use it for
setting up meetings we use it for just
helping you so there isn’t really
anything left
out of that when we’re done yeah running
the business
yeah yeah it gets pretty well consumed
but then the rest
of it the second component is the 20
of what it costs to build out the design
that you signed off on so
if you get a gigantic store it might be
a million dollar loan you may need
250 000 if it’s a like a 30 30
it’s probably gonna your build out and
operating capital is probably going to
come in around 700
800 so yeah
you need to have that other 20 there and
then and then you have to have something
to run
your advertising and something to to uh
pay your employees for the first you
know three months while you’re becoming
uh self-sufficient and that number the
three months has really been shrinking
uh
we’re really closer to a month now if
people follow the rules so
nice um yeah we do the right amount
advertising to get the volume up
to be able to uh
hit black faster than mine that’s the
goal
what about uh what about somebody who’s
working a full-time job i mean i talk to
a lot of
you know doctors dentists engineers you
know
software engineers you know who don’t
necessarily want to
quit their jobs but they also want to
have something going on the side
especially now as you know things are
just uncertain it’s nice to have
you know your own thing going because
nobody knows what’s happening right with
the world right now right so
um is is that a good candidate
uh if they have a full-time job no we
cater to
we cater to that if somebody wants to
put no time in
uh there’s a way to do it you know if
they just want to put money in there’s a
way to do it
um we do have uh one professional group
uh out of the north uh
north midwest i guess is the best way to
put it
that is it’s basically a syndicated
group that
that has a chunk of money and they’re
a group of doctors and they don’t they
don’t want to manage it or build it or
anything else so
we put a manager in place for him and
uh and that person is helping him get
the
first store up and the second store
started already so
um so yeah there are ways to do it
without without
leaving your job at all but most of our
folks that
uh are going to keep a job and which is
most of the folks
uh they put in you know two hours
three hours every other day
so you know eight hours a week 10 hours
a week
can easily be done and the
most of that time is spent you know just
getting reading your reports making sure
that
the cash is flowing and folks are
showing up on time and you got your
scheduling up and
and moving your quarters around you know
pulling them out of the machine put them
back in the change maker
um that’s it it’s pretty much that easy
and and so any any level of
of participation you want to have
we can make it for you the more you
participate the more you make the
less you participate or you have to pay
somebody else to
to help you out you know it’s it’s
it’s a give and take but even if you
only want to work eight hours a week on
it
you can still make a really nice return
on your investment
awesome well i know there’s implications
on financing but does wave max
have any like experience requirements
credit requirements any other like
requirements of
prospective owners
well from a financial standpoint you
have to
you have to have the cash and you have
to be able to qualify for
financing the financing route right
if you’re gonna do it all cash you you
don’t need to
you know qualify from an experience
standpoint
it’s almost better you don’t have
experience running a laundromat
because you had experience from a lot
around you were great at it
already and you knew all the ins and
outs unless you were just buying the
franchise because
of the deep discounts we got which is a
great reason to buy it but
if that’s the only reason you’re buying
it and then then
um you probably don’t know how to run it
so
yeah yeah so
[Music]
and and and if we have people that that
come in with no
watermelon experience myself included
i don’t bring any bad habits with me you
know
i don’t want my store open 24 hours
because i’ve been in stores they’re
open 24 hours and some of them work but
most of them they don’t seem
to work to me i go in hundreds of stores
every month i’m checking out the
competition and
and seeing if uh honestly i i go into
the competition to see if i can take
their customers from them
because if there’s none attended there
and if it’s dirty
or there’s a bunch of out of order
signs on machines i i know i get their
customers
we just people people would rather go to
where service is better
than where it’s not totally absolutely
uh well we have a couple little segments
on the podcast one of them is called the
secret sauce
listen up it’s the secret sauce
i wonder if you share something that you
think maybe if you have one tip
uh that’s making your franchisees
successful i think in this business
whether it’s a franchise or not the
secret sauce is
customer service and and just
provide a level of customer service that
nobody’s seen in this industry
and and uh you’ll be ahead of the game
and if you can afford to keep up with
the technology
you got a home run love that
yeah i love it i think that’s great
secret sauce and i think you know we
kind of
it’s kind of been a running theme
throughout this whole interview of that
customer service
uh being that secret sauce and being
just so vital
you know to you not only you know
maintaining your customer base but
growing your customer base
uh as well as you know operators
around you aren’t operating at the same
level professionalism like we were
talking about
so awesome secret sauce uh i got
another section we call pro tips pro
tips and pro tips is for uh
the newbies the person who maybe doesn’t
own one yet
um who’s maybe looking to buy their
first one you got any good tips
for them besides i mean i think the best
pro tip right is
hey give you a call talk to wave max
well you know i i i’m not like i said
we’re not a hard sell
if the franchise sounded good to you go
to weightmaxlaundry.com and
and find the phone number of whoever’s
nearest you
and talk to them but if it’s not if it’s
not
that the secret sauce in this business
is
is the right location no matter what
the the hot tip is get the right
location
and uh and and don’t lock yourself into
something being a good location because
it’s available
get a good location based on whatever
intelligence you can dig
up to determine that’s a good location
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awesome awesome pro tip yeah and if
you’re looking for more
uh resources on good location there’s
tons out there
go check out in the forums we have a
blog post a while back on good locations
there’s
there’s a lot of resources out there for
good locations so if that’s
if that’s you if you’re new and you’re
looking maybe to buy your first one you
know check out a good location i think
it’s a great pro tip because you can’t
really move your location so if you buy
in a bad location
you’re in a world of hurt it’s tough to
recover from that one do you have any
you may not but we are laundromat
resource after all do you have any
resources that you’d recommend
you know for owners either to grow their
business or to grow themselves
personally
well what was probably the biggest help
for me
to get into the business was talking to
people that were selling their companies
and uh they were you know they were
they’re very expensive ones
and they were the very cheap ones the
very cheap ones you could tell were the
ones going out of business
no matter what the price was if it you
know if it’s under 150 000
that store’s going out of business um
because the successful store is not
going to sell it to you for that price
but
with the equipment but then there’s a
very expensive ones usually over a
million
dollars and uh they spent their
800 900 000 to get all their equipment
and get it built out
and uh and um and they
got a good clientele it’s up and running
and they got numbers to support the
ridiculous price they’re asking
um i wouldn’t buy either one of those
personally
but i would look at the ones that are
going out of business
let’s see if you can pick up their lease
or make a deal with them
you know for uh leasing our equipment or
something
and uh you can get your foot in the door
that way while you’re
while you’re building it out you can you
know have a little bit of business
uh maybe drop off service or something
to get it
yeah awesome awesome resource there’s
there’s great
great information on laundromats in
in google in uh
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in video uh you know youtube yeah
youtube uh there’s there’s so many good
uh clips your stuff i mean there’s some
really good
information out there uh for people that
want to help other people succeed in
and there’s enough business that uh that
if
if you’re gonna do good business there’s
enough there’s enough opportunity out
there that you can
i don’t know if it’ll be that way
forever and i think we’ll probably see a
lot more franchises come into this
industry
in the next five years because um
because you can manage it like a
professional company now
um and uh and so
you know look at look at everything
that’s available to you
save as much money as you can because
more you save going in
easier it’s going to be to have a nice
return on your investment
awesome awesome advice well jim this has
been uh
really awesome i get again i get asked
all the time about franchise model
and people want to know you know if it’s
something that they should look into or
not
and this has been helpful for me to kind
of understand uh
you know what what’s happening in the in
the industry
uh franchise wise and it’s really really
intriguing i think you’re right i think
there’s a lot of
technology that really makes it uh a
viable option
for the right person and so appreciate
you coming on
one more quick question for you if
people are listening to this and they
have
questions that they want to ask you or
they want to get in contact with you
somehow is there is there a good way to
do that
i talk i love talking about this topic
and i do it every day
usually with folks interested in joining
us but
uh i don’t mind answering anybody’s
question if they want to get a hold of
me on
on my uh my email address on our for
is a gmw jmw
at wavemaxlaundry.com
all right get ahold of me they’re
welcome to do that and
if i’m not in their area i’ll still
answer their questions and then
refer them to the to the person that can
help them more than i can
in our company in their area um but
but anybody has a question about laundry
i love talking about this because
it’s it’s going to continue to grow the
technology is great
some of the things i couldn’t tell you
about but i will shortly
we’re going to blow your mind in this
industry and uh
i’m just trying to get vendors in place
so that we can
we can do some beta testing all right
well that sounds like a
teaser that means we need to have it’s a
teaser i’m telling you this yeah
this industry is going to be on fire in
the next five years
awesome well it’s an exciting place to
be and i will link to
uh wavemax uh his website and
i’ll put your email if you’re watching
on youtube it’ll be down in the
description
and links to everything and if you’re
listening on the podcast
um check the show notes for uh for the
email address and the links to
everything including
wavemax’s website jim thank you so much
again for coming on brought so much
value and so much information and
insight into
this industry i really really appreciate
it thanks man
i love doing that thanks a lot for
having me all right we’ll talk to you
again soon
all right man jim was so awesome i just
i love his mindset i love his
willingness to just share what he knows
to share the information he has i
loved that he uh was just
you know he’s just given he said he just
loves to talk to people about this stuff
and uh and and was super willing to do
that so if franchising laundromat is
something that you’re interested in
doing make sure
that you shoot him an email and connect
up with him because he is an
awesome resource for you um even if
you’re not sure
man talk with he’s not hard selling you
on anything so go talk with him it’s not
going to hurt
man but super awesome episode i loved
what he was saying
uh particularly about the technology
stuff that stuff is very intriguing to
me right now and seeing where our
industry’s going
technology wise but there was so much i
took a full page of notes
uh from just all the things that he was
saying so so much cool stuff going on
there
and uh i just want to remind you like i
do every week
make sure you pick at least one thing
put it into action
in your business or in your life this
week because as we start to stack these
things up every episode and we’re
learning from these successful people
we’re implementing what they’re doing
we’re going to be more successful
also and we’re also going to be able to
help more people along the way so make
sure you’re doing that
so so excited that you’re here so
excited for everything that’s going on
right now with laundromat resource
hope that your business is doing awesome
and can’t wait
to see you again next week peace
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