Laundry services that were earlier provided by ‘dhobi ghats’ in India may now face competition from laundromats, at least, in the cities. Since technology has taken over the world, India’s first organised chain of tech-enabled laundry services start-up, UClean, is trying to spread the Do-It-Yourself (D-I-Y) laundry culture across India. Arunabh Sinha, an IIT Bombay graduate, is the Founder and CEO at UClean. With technology at the heart of the brand, UClean also enables the time- crunched customer to avail pick and drop service from the comforts of his/her home or office. It has several options like scheduled bookings at app, website, store or call centre to anytime walk-ins at the store.
The start-up is mainly focusing on tier-1 cities, where there is a high density of DINK (Double Income No Kids) and nuclear families. They are also targeting bachelors and students who are generally averse to investing in household items like washing machines, which become a burden when they need to shift places. They are highly likely to spend on outsourced laundry and cleaning services.
The services that they provide at the store include laundry and ironing services, shoe cleaning, and leather cleaning. Specialised services like carpet, rug and sofa cleaning are directly offered at the customer’s premises. Over the next six months, they are planning to further diversify their services portfolio to include several other cleaning-related services like deep cleaning and cleaning car interiors.
“In terms of expansion, we are targeting to be present in the top 10 metro cities of India in another year. We already have 25 franchises signed, locked and ready for roll out in the next four months. So, we are targeting a 100 stores roll out in the next 12 months, and ensuring 50% of the rolled out stores have turned profitable by then,” said Sinha.
UClean has joined hands with Alliance Laundry Systems USA, a global manufacturer of commercial laundry equipment and Franchise India for a strategic association. The start-up plans to develop about 300 to 350 stores on a pan-India basis over the next three years, The partnership will see Alliance Laundry Systems supply equipment worth about Rs.35 crore to UClean over the next three years. UClean’s current revenues are about Rs. 3 crore achieved in the last seven months from all the revenue streams combined (profit from stores, franchise fee received every time a franchise joins UClean system, and monthly royalties generated through the operational franchise stores).
In India, the laundromat culture is something new in comparison to the US where the laundromat culture has existed for a century or more. Markets like China and the UK are also pretty mature with stable growth and a few market leaders with national presence. India behaves very similar to South East Asia, in particular, Indonesia, Malaysia, and Philippines when it comes to the retail and service industry. The explosive growth of laundromats in this region is a story, which is only about 10 years old and promises a good future in India.
The laundry industry in India is highly unorganised with 97% fragmented between local dhobis, mom and pop local operators, etc. “People don’t prefer the ‘dhobi culture’, rather, they prefer the convenience of doorstep pick and drop. As a laundromat concept, we do our best to encourage and incentivise customers to come down to the store for the D-I-Y experience. All our marketing, promotions and offers are focused on fostering the D-I-Y culture and we have seen a measurable improvement in terms of the percentage of customers who are willing to walk down to the store and clean their clothes themselves. That said, we also understand that D-I-Y is a cultural and behavioural change for a country like India and hence, we are still a few years away from making this a pureplay D-I-Y concept. Keeping this in mind, we offer full-fledged pick and drop services, just at the click of a button,” added Arunabh Sinha.
The total market size of laundry services in the top 10 cities alone is estimated to be $10 billion as these cities have a very high population density of DINK and nuclear families. In terms of laundromats and laundries, there are estimated to be 700,000+ such establishments across the country. About 98% of these are micro-sized in nature with less than 10 employees. A lot of start-ups have mushroomed in this space in the last three years with more than 100 such operators. But there hasn’t been much development in this sector due to lack technology-driven solutions.