SAN FRANCISCO — Are you facing the dilemma of how to most efficiently grow your business? Do you want more sales but don’t want to invest in additional locations? Do you want to minimize the risk of expanding your geographical coverage? If these challenges apply to you and you are not already in the route business, consider it. If you are already in the route business, the same considerations apply to expansionary deliberations.
BLITZ VS. ORGANIC GROWTH
If a dry cleaner is just beginning with routes, the business is more likely to reach critical mass sooner with a sales blitz that reaches many prospects in a short period of time. If the cleaner is expanding an existing route base, organic growth may be the more profitable path to pursue.
SALES TEAMS VS. INDIVIDUALS
A sales blitz, particularly in residential areas, can be highly effective and provide support and competition within the sales team. It also allows for more flexibility in blanketing a neighborhood more thoroughly during the few hours that prospects are home. Individuals are better suited to business-to-business sales.
ROUTES ARE NOT FOR EVERYONE
The route concept still has limitations or requirements that are hurdles for some customers. Fear of leaving their orders accessible and/or in public view is a key obstacle for some prospects, although this may be overcome by implementing a disciplined day-and-time schedule.
A more challenging obstacle is the inability of the prospect to meet the prescribed route schedule due to their other obligations or irregular travel. It will be important to listen to the objections and determine if they can be overcome. If the hurdles are too daunting to clear, moving on to the next prospect may be prudent.
HOMES VS. BUSINESSES
Both residential routes and business routes can be highly profitable.
Businesses require a more sophisticated professional sales approach. Because they have higher turnover, the management and retention of these accounts are critical.
Residential routes tend to be more stable once they are established, evidence has shown.
SINGLE DOORS VS. MULTI-UNIT RESIDENCES
Likewise, single-family residences and multi-unit residential developments can both be profitable. Again, the multi-units tend to have more turnover, even if they are condos vs. apartments. Concierge buildings historically have had less turnover than other multi-units.
SUBSCRIPTION VS. ‘PAY PER’ SERVICE
Some companies have instituted route programs that require a minimum per month to subscribe to the service to ensure that the customer will be profitable. Most use the pay-per-service approach. Almost all require a credit card on file for new customers and have also converted their “legacy” house accounts to credit card on file.
CROSS-SELLING TO ROUTE CUSTOMERS
Since route customers are rarely at home or have time to chat to route personnel, cross-selling efforts must be handled remotely with hang tags and electronic communication, including e-mails, texts and newsletters.
PREPARING PLANT FOR ROUTE BUSINESS
The traditional approach to routes of two days per week per route has historically resulted in substantial swings in production during the week, so scheduling must be done accordingly to maintain productivity and profitability goals.
The plant must also accommodate storage for the finished work awaiting delivery. This is not difficult for most plants. For operations where space is tight, vertical storage/distribution towers can be an alternative.
TRACKING THE PROGRESS
To keep the staff and customers informed, and to minimize customer complaints, utilizing an efficient point-of-sale (POS) system with both piece- and order-tracking capabilities is essential.
COMMUNICATING WITH CLIENTS
Route customers are usually extremely busy and are quite happy to have the cleaner of choice handle their wardrobe care chores. They also need reliable communication if they have special requests or issues. Ensure that they are able to reach an informed staff member when necessary, and that they need not be transferred to someone other than the person who answered the phone. If the communication is electronic, ensure that it is monitored continually so there will be a prompt response.
PROFITABLE WHEN PROPERLY MANAGED
Although routes have a unique set of challenges distinct from other distribution channels in a drycleaning business, they can be a flexible way to grow both sales and profit simultaneously.
Miss Part 1? You can read it HERE