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Archive for June, 2007

PROS & CONS OF TOKEN USE

Monday, June 25th, 2007

 Norman; 

In an attempt to address the abuse of coin changers, a number of operators have considered tokens.  There is some merit to this, but there are also a number of obstacles. Let us consider the various stumbling blocks to implementation of a change, and see just what you might be getting yourself into.

 

First, let’s take care of a common question.  NO!  You cannot purchase tokens the same size as a quarter !  No reputable mint will provide such an item. It is not legal to produce a token that is within .030″ of the size of a quarter.  A quarter is nominally .954″.  So the next token size up is .984, and the smallest one close to the size is .900″.  It is possible to make a coin chute that will accept both .984 and the quarter, but this means any trash of a diameter in between those sizes will also pass through the mechanism.  So a secure conversion will entail replacing the coin mechanism.

 

The next hurdle is to select which token you wish to use.  There are several variables to consider here.  If there is a mix of equipment, some using push/pull mechanisms, and some using drop mechanism or Quartermaster Mechanisms, you are restricted to round tokens.  In round tokens, the following sizes are generally available: .800″, .880″, .900″, .984″, 1″, and 1.040″.  There are a few oddball sizes out there, but they are usually proprietary, that is, dedicated to one specific user.  Before you consider doing this yourself, be aware that there are substantial tooling costs to be paid up front, and a minimum order of 10,000 pieces from most mints.  And the coin acceptors to take them may not be available.

 

Before you make your selection you should first examine the acceptors on your equipment.  Some drop mechanisms can be adjusted to accept the new token.  Others must be replaced.  Not all manufacturers make acceptors for all sizes of tokens.  Some manufacturers no longer exist.  This will impose some limitations on your choice.  And the same make or style of acceptor is not used in all machines.  You will find such names as AirPax, Greenwald, Set-O-Matic, Hanke, Mueller, Keltner, SlugBuster, and others. Each with its own mounting dimensions, and they are generally not interchangeable.  This is the point where many lose confidence in changing to tokens, but it must be done if the conversion is to take place.

 

In selecting a round token one should also consider what is being used nearby.  If an arcade or establishment such as a Chuckie Cheese is nearby, then you will want to make certain that you are not using the same size tokens.  If your token has a nominal value higher than theirs, you will find their tokens in your machines. If their price per token is higher, you will be constantly replacing the tokens which wind up in their machines. This increases your cost, and doesn’t make you any friends there.

 

Top load machines are not quite so difficult.  All three manufacturers of coin slide offer mechanisms to accept the round tokens.  And the chutes from any one of them easily replaces any one of the others.  These all have essentially the same mounting style and use the same operating extension.  In addition, there are some tokens that eliminate the complications of round tokens.  Some of these tokens are plastic tokens, which break into useless pieces when put through the mechanism.  However, these breakable tokens cannot be vended from a change maker.

 

There are also tokens available that rely on unique shapes to avoid the acceptance of bogus tokens.  (See inserts)  These work in lay down chutes only, so are of no use to those with a combination of drop and push/pull style mechanisms.  For small laundromats that do not offer larger machines these may be an option.  However, you must take into consideration that the value of the token is fixed.  The dryers and the washers must vend at the same price, or a multiple of that price.   For example, the token vends at 50›.  The washer will take two tokens, a dryer may take only one.  But it would not be possible to have the washer take tokens to a value of $1.00 and the dryer at a value of 75›. That would involve a totally different token, one for washer, one for dryer.

 

In addition, there is currently only one source of a change maker to vend the odd shaped tokens, American Changer Corporation in Fort Lauderdale. Their units have a unique dispensing device that allows the unusual shapes to be passed and counted.  Other change makers cannot accept the odd shapes as they jam in the dispensing process.  They can be converted to round tokens, but this will involve changing the throat plate made for the specific size to be used. Consult the distributor/manufacturer of your make of machine for this.

 

After all of this, it would seem tokens are not a very good choice.  This is not necessarily true.  Tokens can be an ideal solution for many problems, but there are attendant costs and headaches involved in setting up a system compatible with your equipment and needs.  Once the hard part is over, you have created a system which offers additional security, as each machine will contain only tokens good in your facility.  You also gain added security as you need only fortify one point – the changer.  Your rates become flexible. In effect, your patrons are entering a new country, where you set the rate of exchange.  You can change pricing by adjusting the changer to vend according to how you wish the pricing to go.  This will not prevent phony bills from being fed to your changers, but the forger will receive only a hand full of brass.

 

Tokens will also allow you to create promotional or pre-selling programs.  For instance you may offer a token for a wash through a local store, one token with each box of soap for example.  The tokens MUST be used in a facility which accepts the token. It has no value elsewhere.

 

Refunds are much simpler. If they receive a token, then it must also be used in your store. The scam artist hates this aspect.

 

You may offer those on a fixed monthly income an opportunity to purchase tokens at a discount each month. If the tokens are used, it is well and good. You have provided a service, gained a customer, and leveled out your usage for the month. If the tokens never get used, then you reap the profit of the price difference between what you paid for the token, and the price you received for it, with out any wear and tear on your facility.

 

Tokens are ideal for many apartment complexes. The mix of equipment is generally top load washers and side-by-side dryers, both using push/pull mechanisms.  Most laundry rooms are unsupervised, so vandalism and break-ins can be a problem. By having tenants buy the tokens from a property manager, all cash is eliminated from the machines.  This will also restrict the usage to those who actually live in the apartments, and keeps un-authorized outsiders from using the machines.

 

 In passing, it is also important to point out that the need to change to tokens might be minimized if the problem is addressed at the changer. As with anything else, you get what you pay for.  Bill Validators for the changers can run as little as $120.00 to as much as $450.00.  The least expensive ones offer the least security. Better units offer high sampling and greater resolution to detect bogus bills. Consult your Distributor, and plan on spending money to make and save money by selecting the highest quality validator you can find to fit your machine.

 

As with any other project, you will have to weigh the cost and aggravation of changing to tokens against the potential benefit.  It is not the solution for everyone, but can be of immense value in the proper setting.

Customer Satisfaction AND More Profits

Monday, June 11th, 2007

  Norman;

Everyone is looking for a little extra edge and a little extra profit.  Where can we get a few extra dollars?  And will it justify the expense of putting it in, and give a decent return for the space it fills?  You have a captive audience. They are going to be there for a bit, so how can they be parted from a few additional coins while they are there?

 

Some choices are obvious. There are coin operated vending machines for soaps, fabric softeners, hangers, and laundry bags.  These usually offer few complications, and are an excellent tie in to your business, a source of satisfaction for your customers, and added profits for you. 

 

And of course there are video games, and vending machines for snacks, candy and beverages. But before you jump up to acquire these devices there are some considerations.  Yes, they can generate some extra money.  But you have to look at several factors that go along with these installations. 

 

Video games are popular.  And an excellent way for customers to kill time while the washers churn.  But they can also be a two edged sword.  If the game is not popular, no one plays it. It just gathers dust and takes up space that might be more profitably used another way.  But if it is too popular, you draw players who are not customers, sometimes creating an undesirable gathering.  One which might scare away customers.  This will depend on your area, and your customer base.

 

Vending machines are another common option.  The laundry products are an obvious addition in many facilities. But candy, snacks, drinks and other products are a viable option as well.  Just be careful!!  Do not place candy machines in the front window where the sunlight comes in.  And of course, even if placed elsewhere in the laundry, heat is a consideration.  Most yummies MELT!!  And this may affect which products you chose to stock.  You might consider salty snacks, like chips and cookies, and avoid the chocolate goodies or other things that turn sticky in the heat.

 

Machines for canned drinks are another good choice.  But consider your sales volume in relation to the cost of running the machine.  You can work with a local vendor, and they might furnish the machine and split the profits.  But if the volume of products sold is too low, they will not consider this. It’s not worth their time. Plus, you are constrained to having only the brands they market in the machine.  You can purchase your own machine from Sam’s or other bulk outlets.  These are generally low end machines and are not rugged for tough locations, but they do allow you to put what ever drinks you chose.  You can also buy larger more conventional machines.  Used ones are available from many sources priced at $300 to $1000.  Again, you chose what products to put in the machine.  You could buy brand names, or you could buy the lower cost house brand, however, keep in mind how picky your customers may be. But still consider the operating cost.  How many cans of soda must you sell each month just to cover the cost of the soda and the electric to run the refrigeration?

 

You also have to examine local licensing regulations.  Some apply only to the video games, some places it may only affect vending machines, and some may apply to both.  According to where you are, there may be State, or County or local municipal regulations that may require each machine have an annual tax stamp. They want their cut of the profits too. And revenues for these may be taxable, even those where the revenues from your washers and dryer are exempt.  A potential bookkeeping nightmare.  So check out these requirements before shopping about. 

 

But what else might a laundromat owner offer?  In laundries in more remote areas, coin operated showers are fairly common. I know that to an owner in the middle of a large city, this sounds ridiculous. But we have sold shower meters to a number of laundries in such locations. Their customer base includes farms, ranches, mining works and other places where the home amenities are primitive. The people come into town to do their laundry, and while they are there, they take advantage of a hot shower!  I know this is extreme, but consider where you are, and who your customers are.  It may be something to consider.

 

Other things may be metered as well.  For Laundry applications, the meters have been used on TV’s, Radios, Tanning Beds, and Vibrating Lounge Chairs.  Shoe Shine Polishers (yeah, I know,  who really shines shoes anymore! But it has been done before – and recently!), Treadmills and other powered exercise equipment.  They are often used on ironing equipment, both as ordinary irons and the presses.

 

Other items for a profit center might be Internet access by means of a coin operated kiosk, and also consider Wi-Fi service.  Now how to make Wi-Fi generate cash is dependant on what kind of system you install. But even if Wi-Fi access if free, it may be a significant draw for some customers, if they can use their laptop while their laundry is being done.  If other nearby laundromats do not have this and you do, you will draw those who want to work on-line. The added attraction, is that those who are using laptops are generally more attractive customers.  Students, business people, and others will find this an attraction. 

 

Now for a weird one.  We are having moderate success with the introduction of a token or coin operated pressure washer. The original emphasis was for marina operations.  But now campgrounds and ATV parks have taken an interest.  And we have had a few sales, and inquiries for laundromats!!  Again, this has been to facilities in more rural settings.  The washer is situated outside and used to clean off cars boats, ATV’s, Motorcycles, etc. This one kind of surprised us too, but for a number of reasons and in the right location, it can make sense and cents!

 

Aside from the keeping boats clean, there is the increasing issue of keeping the waterways free of invasive species.  By cleaning off the boat and the trailer as it is removed from the water, there is less opportunity for mosses, algae, and other aquatic hitchhikers from being moved into new waters.  Now we are seeing similar concerns for ATV Parks and Campgrounds.  The transfer of species from one area to another is creating ecological havoc in some places.  The pressure washer is just another amenity to offer patrons. ATV riders may take great unbounded joy in how muddy and cruddy they and their machines may get, but they won’t want to take all the dirt home with them.  Showers and pressure washers can be a great attraction.

 

Coin or token meters are also applied to pumps and water outlets.  As mentioned above, we have meters that have been connected to all kinds of odd electrical applications, such  TV’s, Jacuzzi’s, tanning beds, infrared heaters, even water cannons at water parks.  BUT I must caution that they are not appropriate to convert a domestic washer or dryer to coin operation. There are technical issues involved and it is generally not economical.  But your imagination on what can be metered will depend on what you have there.  You know your business, and you know your customer base. So it will be up to you to figure out what you can do to generate a bit more revenue.

 

It may not have a direct bearing on most laundries, but many owners are into more than just their laundry.  But just to give you some things to think about, lighting on tennis courts, basketball courts, ball fields or other recreational venues can be expensive to operate.  Again, users have been known to leave lights on when they leave.  A coin or token operated timer will minimize this abuse, and pay something toward the operation of the lights. It  may seem a small matter, but providing facilities that attracts customers, but offsetting the cost of providing these facilities is an important part of running a profitable business. 

 

The gist of the whole thing is this:  There are added sources of revenue. There are various and assorted things that can be offered. And there are controls for many applications that were not originally designed to be coin operated.   And there can be issues when taking on some of these options. Laundromat locations are scattered all over the country.  What works in one area, will flop in another. YOU know YOUR customers, so you must consider all the variables before you buy into a possible profit center. But we hope this has at least given you some points to ponder.














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