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Business services 2013-06-04

The Shine of Clean Profits

The organized laundry industry is slowly expanding in India. With market players talking about healthy RoI, read on to know if you can be a part of this emerging industry.

By Senior Sub-Editor
The Shine of Clean Profits

The organized laundry industry is slowly expanding in India. With market players talking about healthy RoI, read on to know if you can be a part of this emerging industry. Traditional dhobi ghats and housemaids are slowly giving way to bigger and organized players in the field of laundry services. Though at present the laundry industry in India is like a drop in the ocean, the players are hopeful about it growing by leaps and bounds. The hope is not unfounded. It comes from the way urban lifestyle is shaping up and evolving. With nuclear families on a rise and no time on hand, more and more urbanites seem to prefer ‘outsourcing’ laundry services rather than playing in the hands of dhobis and maids. Convenience is king!

“While in US, I was struck by how convenient Laundromats were. They were an instant solution with regards to soiled laundry for working couples, students and so we thought of bringing it to India as well”, says Anshul Gupta, Vice President - Sales & Marketing, Quick Clean Private Ltd. Established in 2010, Quick Clean Private Ltd provides hygienic, clean and economical laundry solution to people in several parts of the country.  Besides providing laundry services, it also has Laundromats- DIY (Do It Yourself) laundry services.

With 11 to 13 franchise stores in the northern part of the country, Quick Clean now plans to move south slowly. “Going forward we see Bangalore, Pune & Mumbai as high potential markets. A franchisee can expect stable returns as the market is wide open. From the company’s perspective, we provide 360 degree support starting from site selection and equipment sourcing to training, operational and marketing support.”

Shining prospects

Most of the organized players provide pick and drop facility for clothes (requires a minimum number of clothes), approximately 24-hour turnaround and own number of portable kiosks and customer care units.

According to a KPMG study, the Indian Cleaning & Laundry market is over Rs. 5200 cr and is growing at the rate of over 30% per annum.

Strengthening Presence

Even the international brands are making inroads into the country. With over 1900 outlets in 31 countries, 5aSec has entered the Indian market with its first store in Mumbai. The brand is looking to expand with both, corporate and franchisee owned stores, in and around Mumbai to begin with.

“We’ll help our franchisees identify an appropriate market, select a location, negotiate with landlord, develop business plan and get bank finance”, says Suresh Bhatia, Managing Director, SB FabCare.Bhatia further elaborates on the dearth of organized dry cleaners in the country that prompted SB FabCare to jump into this business.

“From 2002 to 2005, many international apparel brands forayed into India. The fashion market grew sizably but there were hardly any organized dry cleaners in the market to service high value fashion products.”

Catering to the market, lately there’s been a hike in the number of organized players entering this industry. And the opportunities in the Indian laundry industry are high as relatively less development period is required. Converting the needs of the urban class into revenue will lead to a win-win situation for both the customers and the market players.

With the industry growing, as a franchisee, you can be assured of good and stable returns. However, a lot of marketing and analysis is required in the beginning to set base.“High initial capital investment and finding the requisite semi skilled labour are a bit challenging at times. This business is not for quick buck makers, but for those who are looking at steady stream of income and ROI”, opines Suresh Bhatia, Managing Director, SB FabCare.

Anshul Gupta, Vice President - Sales & Marketing, Quick Clean Private Ltd. adds, “Our industry is price sensitive as we compete with cheap dhobi service and house maids. But since we focus on quality and timely delivery (60 mins), we are able to replace maids and dhobi service for laundry requirement of our customers.”

FRANCHISE FACTS (for Quick Clean):
Investment: 15-30 lakh
Area: 350 – 500 sq ft
RoI: 50%
Break-even: less than 24 months

FRANCHISE FACTS (for 5aSec):
Investment: Mother store: 80-100 lakh, Satellite store: 25-40 lakh
Area: MS: 600-800 sq ft, SS: 300 – 400 sq ft
RoI: 50%
Break-even: MS: 24-36 months, SS: 18-24 months

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