Dry Cleaning & Laundry Services

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 17,600 dry cleaning firms in the US provide services to clean and maintain clothing and home furnishings, such as drapes and bedspreads. Services are provided to both individual consumers and commercial accounts and include cleaning, alterations, and repairs. Most firms are independently owned, but may operate as franchisees of national chains.

Changing Regulations

Industry regulation of Perc (percholoroethylene) is continuing to become more stringent.

Green Cleaners as Market Opportunity

Some dry cleaners are using growing opposition to Perc as an opportunity to operate in a more environmentally-friendly way, and advertise their “green” status.

Industry size & Structure

An average dry cleaner is independently owned, has about 5 employees, and generates $462,000 in annual revenue. It has over $100,000 worth of equipment, and spends around $7,000 a year on advertising.

    • The US has about 17,600 firms with about $8 billion in annual revenue.
    • 81% of firms have fewer than 10 employees.
    • Companies may operate as franchisees of national chains.
    • Segments include cleaning services for individuals and businesses, reselling, and alterations.
    • Large companies include DryClean USA, Zoots, PWS Laundry, and Martinizing Dry Cleaners.
                            Industry Forecast
                            Dry Cleaning & Laundry Services Industry Growth
                            Source: Vertical IQ and Inforum

                            Recent Developments

                            Feb 22, 2023 - Training Improvements Needed in Laundry Industry: Survey
                            • Top areas of improvement for the laundry industry include training, sustainability, and cost management, according to a recent survey conducted by American Laundry News. The American Laundry News Your Views survey asked participants which areas of the industry need improvement. Nearly half of the respondents selected training, followed by sustainability (41.4%), cost management (41.4%), labor relations (37.9%), and certification/accreditation (17.2%). When asked how laundry and linen service operators can improve the industry, 30% of respondents said “make sure all equipment is functioning properly,” 23% said “provide a comfortable, safe working environment,” 20% said “using environmentally friendly chemicals,” and 16.7% said “provide good customer service.” Survey respondents also shared common complaints received by customers, which include high service costs (40.7%), incorrect orders correctly or shortage of items (22%), goods not cleaned enough (14.8%), and goods not ironed or pressed well enough (14.8%).
                            • An Atlanta-based startup called Presso has introduced a new dry cleaning vending machine that is being adopted by hotels and apartment buildings, according to CNBC. Consumers can use the Presso machine by positioning the piece of clothing to be cleaned and entering information about fabric and size. The cleaning process only takes five minutes and costs up to 80% less than traditional dry cleaning in many cases. Presso has emphasized that its approach is more sustainable, consuming seven times less water and three times less electricity than conventional laundry and dry-cleaning services. The machine also eliminates the use of disposable plastic bags and the need for transportation to a cleaning facility. Starting in boutique hotels and apartment buildings, Presso is now in several Holiday Inns and has plans to expand to more IGH properties. The company also has plans to bring the machines to consumers at home.
                            • The US market for laundry facilities and dry cleaning services is projected to increase at a compound annual growth rate of 4.7% from 2023 to 2033, reaching $18.2 billion, according to a Future Market Insights forecast from Market Research Blog. On-demand services incorporated by retail laundry and dry clean services are helping to improve efficiency and convenience for customers via apps to help pick up, clean per customers’ instructions, and supply washed clothes at a scheduled time. The industry is also benefiting from a push by companies to bring staff back to the office full time. Still, the effects of the pandemic linger. Based on a Planet Laundry survey, COVID-19 reduced laundry shareholders’ average earnings by 6.9% between 2019 and 2020, per the forecast.
                            • Inflation remains the top business problem for small business owners, with nearly a third of owners reporting inflation as their single most important problem, according to a survey by the National Federation of Independent Business (NFIB) in American Coin-Op. The NFIB’s Small Optimism Index increased 0.6 points in November 2022 to 91.9, marking the 11th consecutive month below the 49-year average of 98. According to NFIB Chief Economist Bill Dunkelberg, “Small-business owners are seeing a slight ease in inflation pressures, but prices remain high. The small-business economy is recovering as owners manage an ongoing labor shortage, supply chain disruptions, and historic inflation.” Staffing shortages continue, with 44% of owners reporting job openings that were hard to fill, a historically high rate and not typical of a recession period. Owners are still encountering supply chain disruptions, with nearly two-thirds reporting a significant or moderate impact on their business.
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