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Worth Your Weight

About knowing where your revenue is coming from

CHICAGO — When asked in this first quarter 2020 American Drycleaner Your Views survey to tell us: “Do you know your drycleaning operation’s value?” Here is what respondents reveal:

Thirty-three percent say, “I have a fairly good idea but haven’t sat with my accountant and gone over it,” while 20% admit they have “no idea,” of the worth of their business, another 15% know exactly what their business is worth in the market today.

Still another 27% of respondents say they, “don’t really have a firm idea, only guessing at this point,” and 5% aren’t thinking about it at all. (See graphic.)

The survey then asks: “Is your business comfortably profitable?” Here is what respondents relate:

• “It is, however you can never stop trying to improve it or rest on your laurels.”

• “Yearly it is going down since four or five years ago, and I think that is the general trend.”

• “On a scale of 1 to 10, I would say about a 6 or 7.”

• “Just comfortable.”

• “No. This is my number one business focus.”

• “Yes.” (Many answered like this, but some said “No,” or “Not really.”)

• “It is finally generating a profit, but not enough for me to live off of. I’m using profit to pay down debt at this point.”

• “Yes, we can improve some operational effectiveness and make things more robust.”

The survey also asks: “Where does your largest chunk of revenue come from?” Respondents by far indicate that “Walk-In/Drop-Off” generates the largest chunk of revenue, at 71%. “Routes” generated eight percent and “Wholesale” just two percent, while a “Balanced Mix” of everything garnered 19%.

The survey then asks respondents to finish this sentence: “If you were going to sell your drycleaning business tomorrow would you be….”

“Happy with the price you’ll offer the market, and expect to get it,” says 15%.

“Comfortable with the price, hoping to get it,” answers 46% of respondents.

“Know it’s a reach, and probably full of negotiations,” notes another 24%.

“Have to take a pass now, wait until the value rises,” says 15%.

Lastly the survey poses this: “Does your drycleaning operation’s bottom line give you peace of mind?”

• “Yes. Always a positive cash flow with cushion.”

• “Labor is my biggest expense and I still can’t get good employees; that doesn’t give me peace of mind.”

• “No, there’s a lot of uncertainty between economy, big players in the game, and casual business attire.”

• “Yes, have delegated many of the management roles to my employees and they have maintained our customer base with many weekly clients.”

• “No; I worry about it virtually every day.”

• “Yes, we maintain a steady 30% profit margin.”

The Your Views survey offers a current snapshot of the trade audience’s views. Qualified subscribers to American Drycleaner e-mails are invited to participate anonymously in the unscientific poll.