Strategic Expansion and Branding for a College Subscription Laundry Service
Situation:
The COVID-19 pandemic disrupted our clients laundry’s business, putting pressure on the family-owned enterprise to pivot and find alternative ways to maintain profitability. Our client approached REM with the idea to expand into a laundry subscription service tailored toward college students, as the laundromat is located near multiple college campuses. They asked for a comprehensive business plan for the expansion of the company with the goal of securing funding from investors and initiating operations.
Challenge:
There were many obstacles to overcome in creating a business plan for the construction of a new entity of our client. The most important initial decisions involved determining a target university and adapting branding and operations plans to be in tune with the time of COVID-19. Additionally, our client needed to ensure the creation of a profitable enterprise.
Approach:
REM strategists working on this project held frequent meetings, both internally and with the client, in order to create an actionable plan. First, the team listened to the client’s vision, asked questions, and sought to understand the desired outcome. Then, through a combination of research and creative thinking, the team outlined a comprehensive business model for our client.
The recommendation is to launch a new business utilizing existing facilities, targeting busy university students in the area. REM strategists researched several universities, assessing them based on factors like reopening dates, student population, willingness to pay, campus laundry options, competition, and Greek life presence. Based on this analysis, one university was chosen as the initial target market.
By offering semester-long subscription pricing, this new service will be able to cover costs and turn a profit. Based on the prices of similar laundromats geared towards college students, REM suggested a pricing plan for these services that includes semester subscriptions for three options for laundry bag weight and two options for frequency of services. The pricing strategy also explains potential referral and student ambassador programs. REM strategists accounted for all fixed costs, such as that of a new delivery truck, a web domain, covid protection gear, and laundry bags. Variable costs included, gas, water, electric, labor, laundry detergent, dryer sheets, and fabric softener. With these costs in mind and a rough outline of a pricing strategy, REM calculated the break-even point, expressed as the yearly number of customers needed to break even.
Finally, REM strategists worked closely with branding designers to devise a complete branding and marketing strategy for TALO. To demonstrate its commitment to helping the busy student, TALOs website and social media platforms will showcase how students are using their time in place of doing laundry. Another part of branding that is vitally important in today’s social climate is the acknowledgement of COVID-19 safety precautions. TALO will include a mission statement outlining the measures it takes to ensure all aspects of the laundry facility and clothes are kept completely sanitary. Finally, REM suggested a color scheme and logos to represent the TALO image.
Impact:
Our client’s laundry service was noticeably affected by the global pandemic, and the decision to launch the new service will provide a durable path for survival and growth for the family-owned laundromat. This will serve as an independent organization with the purpose of providing an alternative revenue stream for the laundromat. This service not only has the intentions of keeping the doors open at the laundry company, but also delivering a strong communal impact, where it will give focus to other small businesses and local events in the college towns it will operate in. Lastly, once established, it will have the unique opportunity to offer its operational and network capabilities to proprietarily grow its brand, while at the same time pass on the impact by helping other local laundromats keep their own doors open.
Rem and Company Team:
Team Lead: Jake Steirn
Senior Strategist: Sam Rosenthal
Strategist: Anay Simunovic
Strategist: Julia Mitchell
At Rem and Company, we're on a mission to keep doors open and dreams alive. Rem and Company started as a social impact initiative offering free consulting services to small businesses impacted by COVID-19. Rem and Company has become an information hub and digital community platform for small businesses in need. At Rem and Company, small businesses stay up to date on trends in their industries, learn new approaches from peers, build a network, and develop the capacity to adapt as the world around them changes. Our consulting teams provide small businesses with the opportunity to identify and prioritize issues facing their business, propose innovative strategies and facilitate execution. If you are a small business owner and want to learn more about how we can help, request a free consultation.