This is a guest post by Bruce Allison of Commscloud, more details at the end of this post.
A story about innovation turning stumbling blocks into stepping stones
In my experience, in business, you will always come across stumbling blocks and it is the ability to turn these into stepping stones that has the greatest effect. Successful entrepreneurs I have known have always focused on the solution not the problem. 22 years ago I needed a sea change after spending many years building a successful insurance business. I bought a struggling laundry business in Maroubra called Lucy’s.
I had no experience in retail services and soon came across a real hurdle, a lack of revenue and a small market. The laundry was located in an area where using a laundry was a luxury and the former owner had reduced the price of services to an unsustainable level to try to get people through the door.
The laundry had a 2 shop frontage and a huge operating area and was operating way under capacity. That revenue hurdle was compounded by the cost associated with the underutilised area.
The first thing I did was turn it into a laundry café to add value to the customer experience as they had to spend 2 hours to do their own laundry. It offered a point of difference to competitors in the area and encouraged them to spend their money at Lucy’s. I partnered with a local dry cleaner to expand my offering. Initially I knocked on every gym and hairdresser door building a steady business and still the business was just breaking even as long as there were a few days of rain each month. I needed a new approach.
Getting the city to come to Maroubra
I needed to focus on a solution, on the positive things about the business. It still had a lot of available capacity, the rent was very good and it occurred to me we were only 20 minutes from the Sydney CBD. I remembered that in my research when looking for a laundry I had looked at businesses in the CBD. They were too expensive. The rent was too high but the turnover looked great. The big question was how I could get the great turnover of a city laundry in Maroubra. The stumbling block appeared to be being located in Maroubra but in fact that became my stepping stone. All I had to do was create a way to collect laundry in the CBD and get it out to Lucy’s to process and return it.
That’s when Lucy’s Laundry Bins was created.
While putting some clothed in a recycle bin, I had an epiphany.
Why couldn’t I install a bin into every apartment block in the city to collect laundry to wash or dry clean? I set up a trial service into the Connaught Building in Sydney’s CBD cutting a deal with the building management to split a percentage with them for the use of the common area, Installed the bin into their garage area where customers could deposit the clothes in bags with their apartment number included by 8:30am to be returned by 6:00pm that night. I installed lockers which I rented to the apartment owners for the cleaned clothes to be returned to.
Offering something valuable
The service was a real value add to the apartment block, promoted by the building management and direct to the occupants. It was more successful than I could have hoped for and proved there was market demand for the service that added value and encouraged me to expand to other apartment blocks in the city.
The stumbling block I had of being in the wrong location for local laundry services was the reason the rent was good. This became the stepping stone as the low rent provided me with the cash to be able to invest in laundry vans for laundry runs into the city.
I am a restless soul so after 5 years I sold Lucy’s to concentrate on a new passion – Technology.
17 years later my communications business Commscloud provides real value to clients requiring an independent broker that understands the applications for business messaging solutions using SMS, voice broadcast, email and fax. We provide VoIP and internet connectivity solutions from a number of providers.