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Northeast Shows Signs of Growth; Others Struggling

Ian P. Murphy |

CHICAGO — Building upon last month’s 0.9% growth, drycleaners in the Northeast reported stronger sales for June and second-quarter 2010, while all three other regions’ sales stagnated or declined.
Most operators in the Northeast reported sales growth, bringing average sales among all respondents up 3.7% from the same month in 2009. Drycleaners fared almost as well for the full quarter (April-June), with average sales up 3.6%.
Achieving those numbers hasn’t been easy, however. One operator says gains seen early in the year have slipped, while another has pursued new-customer acquisition aggressively “to stay even and surpass ’09 sales.” Another attributed all improvement in his operation’s sales to a temporary bulk account.
Operators in other regions haven’t been so lucky. The Midwest suffered the worst, with June sales down 3.0% and the second quarter off 4.9%. Also seeing a substantial decline were operators in the South, where June sales fell 3.1%, and second-quarter sales dropped 3.0%.
Southern drycleaners reported continued pricing pressure as a factor in the poor results. “We haven’t increased prices since May 2008 [and] are doing promotions to increase piececounts,” one operator says. “Thus, the average revenue per piece is down a bit from a year ago. Maybe — just maybe — we are near the bottom of the decline, but the chance for recovery seems fragile or even unlikely.”
The West saw mixed results, with sales for June 2010 up 1.5%, and totals for the quarter slipping a slight 0.6%. “These increases came only after much time, effort and money were spent on marketing,” one operator says. “We have been working very hard to increase sales.”
“Business is terrible,” another Western operator says. “Having to offer so many coupons and specials, my margins are deteriorating. And the economy has driven so many consumers to wash-and-wear — especially in the summer.”American Drycleaner’s Wire surveys readers every month on a variety of issues facing the industry. While the survey presents a snapshot of readers’ viewpoints at a particular moment, it should not be considered scientific.
 

About the author

Ian P. Murphy

American Drycleaner

Ian P. Murphy is a freelance writer based in Chicago, and was the editor of American Drycleaner from 1999 to 2011.

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