Dry cleaning is a multi-billion dollar industry. Some of the oldest franchise names – Martinizing Dry Cleaning, Comet Cleaners, and Dryclean USA – dot the country and compete head-to-head with mom-and-pop locations.
But several years ago, Tiffany Hawkins and Allan Boomer didn’t choose any of the longstanding dry cleaning brands when looking at new franchise opportunities. They signed with Greenbelt, Maryland-based ZIPS Dry Cleaners, a relative newcomer in the dry cleaning franchise business. They opened three stores through their firm Momentum Advisors, based in New York City.
Hawkins said they chose ZIPS because it has a “solid business model.” The cleaner advertises itself as a same-day, one-price, low-cost alternative. At the time, the company had launched a major brand upgrade “we felt would continue to drive the profitability of the franchise,” she said.
They now have signed the largest development deal yet for ZIPS, agreeing to build 20 stores in the Atlanta area over the next five years. That deal, along with others around the country, puts the franchise on course to open 25 stores a year.
ZIPS opened its 60th store on Friday in District Heights, Maryland. A second store is set to open in Portland, Oregon, this summer, a quick follow to the first store that opened in Portland in February. Cincinnati, Austin, and Mechanicsburg, Pennsylvania, will get a ZIPS this summer.
“We’ve got a pretty nice pipeline,” said Drew Ritger, president and chief executive officer of ZIPS. Ritger joined the company in December 2017 after 22 years at Sonic Drive-In where he became accustomed to opening more than 180 stores a year.
ZIPS began in Maryland in 1996. But it didn’t get serious with franchising until about five years ago. “We’re like a 20-year-old startup,” Ritger said jokingly.
Any piece of clothing, whether a silk blouse or winter coat, can be dry-cleaned for $2.99. ZIPS pushes for a customer’s overall dry cleaning bill to average 60 percent less than competitors. New stores offer wash-and-fold services for those who don’t want to wash their clothes themselves.
Each store averages about 3,000 square feet in size and has a compact system for fitting into the space. “If we can find a free-standing building we can convert, great,” but that’s not the primary site requirement, Ritger said. The franchise likes to find an end-cap at a shopping center or locate in a retail building with two or three tenants. ZIPS approves every site a franchisee chooses.
ZIPS does market studies for each city to determine the best locations within the area. Since it is service retail, ZIPS looks for real estate that’s heavy on weekly ritual traffic, such as going to the nail salon or getting a haircut. These are consumers doing their errands closer to home than to work.
“We drive a lot of traffic,” Ritger said. That requires easy access for customers to get in and out.
Stores have about $1.2 million in sales annually, with a few doing nearly $3 million, according to Ritger. For a franchisee, the total investment is $1 million to $1.5 million per store.
So far, the franchise hasn’t had a store close. Ritger said the beauty of dry cleaning is that there’s “nowhere near the competition as there is with fast food.”