Mehdi Ebrahimpour, owner of Clean 'n' Dry laundromat. Photo / Michael Craig
In the early 1980s New Zealand laundromat advertisements were almost as common as those of retailers' today harking on about their latest seasonal sale.
But over the years as the ads have died out so too have the laundry companies. That was until recently. Laundromats are now re-emerging, popping up all over the country, and Auckland's population growing up and the perception that laundromats are easy businesses to run may be the reason why.
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Aucklander Mehdi Ebrahimpour, owner of Oteha Valley-based laundromat Clean 'n' Dry, and a project manager in the construction industry during the day, opened his own laundromat as he could see a gap in the market. He runs the business on a self-service model, a business on the side to supplement his income.
The Iranian-born Kiwi said he initially started the business as he thought it would be straightforward and would essentially run itself, but he said he soon found out that was not the case, and he needed to be reachable, at least remotely, at all times.
Ebrahimpour puts the recent re-emergence of laundromats over the past few years down to many people holding the same belief; that laundromats run themselves, similarly to gyms (which have also been popping up all over the place recently), with high investment a barrier to entry, but low overheads when unmanned.
"I spent more than a year learning about [laundromats] and [considering] a drop-off service, but at the end when I calculated time and salary to pay for our staff, it would cost more than the self-service model."
There are two kinds of laundromat in New Zealand: self-service locations, and those that have staff and offer additional services such as folding or drop-off. The self-service model is by far the most common, and most laundromats are run by independent operators in this country, alongside chain franchise Liquid.
Ebrahimpour said there was a misconception that there was a lot of money to be made in the industry. The margins were low, and largely dependent on the area, he said.
"Because there are lots of laundromats around now, I think some can barely [break even]."
He also believes that laundromats are on the rise due to the demand around convenience from society and the want to save time, though many would have started on the basis that it was a simple business, he said.
"Some people, same as me, this is a secondary business, and even if they don't have big margins still they keep it because it's extra money."
Ebrahimpour said Clean 'n' Dry made between $5000 to $6000 each month before tax. He spent about $400,000 to establish his 100 sq m facility.
Catherine Wickham, co-owner of In A Spin Laundromat, has been running a fully automated self-service laundromat with her partner James for almost two years.
"I had to use the laundromat on holiday, and I thought 'My goodness, what a great little business model' ... I thought 'I'm middle class New Zealand and would never use a laundromat unless I had to, how could we proposition that for like-minded customers who are time-poor, and make it a pleasant experience'," said Wickham, who works as a fulltime customer experience manager.
She initially looked to buy a laundromat but later decided to start her own from scratch. Today her laundromat operates 25 machines.
Unusual for the industry, her business is fully automated and has Eftpos terminals on all of the machines. "We don't need to walk in through the door. We have cameras, and if [someone] was to ring me, I can stop the machine, start the machine, advance the machine and give some free washing all remotely from my phone. We've been in India and been able to deal with customer complaints because of the model we've set up."
The reason for growth in the number of new laundromats across Auckland was different for each area, Wickham said. In South Auckland, she said, there had been an upsurge as many people living in the area could not afford to buy their own washing machine, while the rise in more affluent areas could be put down to demand for convenience.
"There's a good marketing machine happening at the moment, where people think that laundromats are hugely profitable and you'll make a fortune. They are really good, but I personally feel the Auckland market is starting to get a little bit saturated."
While the costs to start this type of business were much higher, she said many were still getting into the space as it was "one of the few cash businesses left".
Wickham started to notice an increase in the number of laundromats starting up over the past 12 to 18 months. "When I started on this journey (two years ago) there were nowhere near as many as today. But I do think as Auckland grows and goes up with apartment living, that the demand will become much greater.
"If you look at places like New York and London, that's the norm."
Dave Pene, the Auckland representative for the Textile Care Federation of New Zealand, said laundromats were "flooding the market" throughout the country.
Twenty years ago there was one laundromat in every town centre, but over the years this has scaled back. Pene believes laundromats are again on the rise and as result the market had become saturated.
A quick look through Trade Me, pulled up more than 20 laundromats for sale - most located in the Auckland region.
Pene said stopping by a laundromat had once again become convenient as people's lives had become busier, and housing was increasingly growing upwards.
He said he had noticed a flurry of new operators, particularly in Auckland, over the past two years. "They are popping up all over the place because of the [demand] for convenience, and there are a lot of new immigrants that are taking on that business model.
"The growth of Auckland and the way it is growing, there's a convenience [factor] for people who are living in high-rise units." When Pene first moved to Avondale 20 years ago there was just one laundromat in the area. Today, he said, there were six.
On property executive who spoke to the Herald, who wished to remain anonymous, said the re-emergence of laundromats was a clear indication that there was a market for it.
"We've got a rapidly growing city centre population, and certainly for complexes like mine, we are body corporates, so you can't have washing [hung] outdoors. There's often limited space for laundry facilities within an apartment so maybe people might not have washers or dryers," the man said.
"It's not quite the sharing economy in the technology-enabled sense, but maybe people are realising that they don't have to own these quite expensive appliances."
Adjunct AUT University professor Mike Hutcheson, who himself owned a laundromat in Christchurch for about five years in the 70s, said laundromats traditionally, about 20-30 years ago, engaged in a lot of radio advertising. Local print media and letter box pamphlets were also common.
"It was very much about a local, you knew who your audience was. For us, it was letter box drops and door knocking, there were specials for locals ... [running a laundromat] requires a high-density population and usually younger people, [around] lots of flats."
The height of advertising for laundromats was the early 80s, mostly through radio, as back then there were no national chains to warrant TV commercials, Hutcheson said.
Laundromats, however, had died out over the years as the cost of washing machines and dryers became more affordable.
He said demand had come back recently due to "the transient population" - backpackers, and students and young professionals flatting.
Figures from Nielsen show that the advertising spend by laundromats has jumped significantly over the past two years. In 2017, laundromats in New Zealand spent a total of $300,000 on advertising, this jumped to $1.1 million in 2018, and to $2.1m in 2019.
Styling habits have a huge impact on the business landscape.
Over the past five years, the increase in the number of laundromats has been coupled with a decline in dry cleaners.
The decline, Pene said, could be attributed to the millennial - and their preferences around corporate styling, preferring smart casual over the suited-and-booted look.
"Young executives these days, they are no longer wearing suits and ties to work, a lot of them are [instead] wearing the likes of casual trousers and shirts, which can be chucked into a washing machine and easily washed," he said, adding that at least 50 per cent of corporate clothing sold today could be included in a regular load of washing.
"There's been a decline in the dry cleaning side of it, but on the wet side such as the laundromats, they are growing."
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