Robert Hennessy has an unusual talent. If you tell this ex-analyst entrepreneur where you live in New York, he can name every laundry and dry cleaner within a stone’s throw. “Seventy-eighth between First and Second? There’s four dry cleaners on that block,” he reports, reeling them off one by one before sniffing, “They’re all 7-to-7 places.”
The term 7-to-7 refers to the typical operating hours of drop-off laundries and dry cleaners—and for Hennessy, it translates to a huge business opportunity.
A year ago, Hennessy launched DashLocker, premised around the idea that New Yorkers—perhaps millions of them—have fast-paced, complicated lives that the business hours of the average dry cleaners simply don’t take into account. For them, DashLocker offers a simple alternative: Dump your dirties in a locker and about a day later, everything comes back fresh, clean and folded. A text or e-mail notifies the customer when his clothes are ready for pickup. The biggest selling point: DashLocker, which operates several freestanding stores and is aggressively partnering with Manhattan landlords to add lockers inside apartment buildings, is accessible 24/7. “We’re always here and we’re always open,” says Hennessy. “If you’re working late, have a social life and value your sleep, there is no other proposition.”
There are a million bags of dirty clothes in the naked city, and DashLocker wants to wash every last one of them.
Hennessy seems an unlikely figure for this line of work. In an industry dominated by mom-and-pops (where mom does the wash, pop takes the cash and English often happens to be the first language of neither), Hennessy is 28, boy-next-door handsome and cut his teeth as a hedge-fund analyst. In fact, it was his research into a large commercial laundry company that turned him on to the business.
As Hennessy sees it, dirty clothes are the common denominator in a city of rich, poor and everything in between. “You can live in Carnegie Hill or East New York, but you’re still doing laundry,” he says. “I thought it was a fantastic business model and one that, even in a sideways economy, didn’t suffer.”
Yet muscling into the business isn’t so simple. For one thing, New York already has an ample load of laundries. A quick search of Yellowpages.com reveals 1,283 coin laundries in the city. In the entire metro area, the number of facilities grows to 3,500. But there’s a catch: DashLocker doesn’t actually do the wash. Rather, its business is all about logistics. All DashLocker’s services—wash and fold, dry cleaning, shoe shining—are handled by outside vendors. What Hennessy brings to the equation are convenience and accountability.
Most New Yorkers who entrust their wash and fold and dry cleaning to storefront vendors—“drop stores,” in industry parlance—have at one time or another found themselves at the mercy of the mom-and-pop. Not able to make pickup before closing time? Then your clothes are stuck for the night behind a roll-down gate—a topic once addressed in an episode of Sex and the City. Or what if, say, a favorite item comes back ruined and that somehow becomes your own fault? (As seen in a Seinfeld episode.) “The traditional cleaner is never open at convenient hours and they hold your laundry hostage,” says DashLocker vp, marketing Caitlin Garzi. “You can’t contact them. You have a receipt, but really have no idea what you’re paying for.”
While automation and transparency have transformed other industries, Hennessy points out that the laundry trade occupies the same dark corner of customer service it did decades ago.
But thanks to proprietary software Hennessy licensed from a San Francisco company called Laundry Locker (which, with a presence in 801 buildings, has already done in the Bay Area what Hennessy hopes to do in New York), DashLocker’s customers are freed from the separation anxiety that can accompany handing over one’s cherished garments to the washerwoman.
Here’s how DashLocker works: Hennessy affixes a bar code onto each bag of wash and fold and every garment to be dry cleaned, entering all the information into a computer system. The software allows him to track the laundry as it makes it way through the process—from the trucks that pick it up at DashLocker to a distribution warehouse in Long Island City, N.Y., that hands it off to individual vendors to the return run back to the locker. Customers can track their items online. (If they email DashLocker with a question, they get a callback.) Hennessy has even arranged for each and every piece of clothing headed for the dry cleaners (that’s 11,950 items in his database to date) to be photographed, just in case an item goes missing.
For all that, DashLocker charges its customers what Hennessy calls “the high side of average,” at least in New York: $1.25 per pound for wash and fold, $7 to dry clean a blazer and $9 to shine a pair of shoes, for example.
“Our ideal customer is 28-ish, female, active and upwardly mobile,” Hennessy reports. They are customers for whom a six-figure salary might still be a dream but also those for whom, as Hennessy likes to put it, “their time’s worth more than their money.” (The formula has already been proven to work in this particular city, home to the crosstown cab ride for the bargain price of $30.)
DashLocker is just the latest business of its type to pop up in what has not only become a service economy but also a convenience economy—and not just a convenience economy, but a why-didn’t-you-get-it-to-me-yesterday economy. And while they may be among the most hard-to-please people around, New Yorkers are hardly the only busy people in the world, nor is New York the only city where convenience has spawned such businesses. Take TaskRabbit, which enables consumers to go online to find someone to run their errands for them and which has set up shop in nine markets, including Boston, Chicago and Austin, Texas. Amazon Lockers lets customers pick up their Amazon.com shipments at a time and place convenient to them, in cities including London, Seattle and Washington, D.C. Meanwhile, retailers from Walmart to L’Occitane (along with the likes of Amazon and even Google) have begun experimenting with same-day delivery in select markets.
As for DashLocker (which is not yet profitable), it has experienced success and challenges in its first year. On the one hand, the population of New York is on the upswing (up 2 percent versus 2010) as the city continues to create jobs in the tech and finance sectors—businesses known to employ the young, the busy and the well-compensated who constitute DashLocker’s bread and butter.
Also in Hennessy’s favor is the fact that most New Yorkers choose a laundry provider according to its distance from their homes, not out of affection for a particular operator. With brand loyalty less of a factor, DashLocker can entice customers simply by making a burdensome chore much easier. (As one customer review enthuses: “It is super convenient to have a dry cleaner and wash-and-fold place that picks up and delivers. You never have to worry about getting there while they are open, which, if you work long hours, is pretty much impossible with most dry cleaners. These guys make it so easy.”)
Still, in a business that’s all about convenience, Hennessy has learned that reducing the distance between the front door and the locker door necessitates changes to his business model.
Originally, DashLocker built storefront locations—a model that was great for marketing opportunities (stores are sleek little cubbies covered with AstroTurf and bearing DashLocker’s eye-catching logo) but which also meant rent to pay. These days, Hennessy’s strategy is to put lockers directly into non-doorman apartment buildings, usually in basements or mailbox nooks. “My ideal building is the biggest one I can find, with an elevator and without a doorman,” Hennessy says. “What amenity does a non-doorman building have? Nothing.”
Putting lockers in apartment buildings not only gives landlords an amenity that appeals to tenants, it gives Hennessy a revenue-generating space rent-free—no mean feat in a town where commercial rents can run $65 a square foot. DashLocker has expanded into 41 apartment buildings to date.
“People are going to go to the cleaner closest to them, so it makes sense to locate in apartment buildings,” Garzi says. “You don’t have to walk anywhere.”
The downside is that, while New York is still home to plenty of walk-up apartments (600,000 units total by one estimate), they just aren’t being built anymore. Today, developers are putting up luxury high-rises, where doormen take care of petty things like laundry and dry cleaning delivery.
That pretty much eliminates the need for DashLocker, some say. “I think DashLocker’s model would work in buildings with no doormen, but in terms of real estate development, New York is going in the opposite direction,” says Wayne Edelman, owner of Meurice Garment Care and New York’s widely acknowledged godfather of dry cleaning.
“I can’t see moving into one of these condos and being told to bring my laundry to a locker,” Edelman adds. “I’d want to throw it at the concierge.”
Further, Edelman sees DashLocker’s young demographic as problematic, as millennials’ laundry needs tend toward the wash and fold rather than the dry-cleaning variety, thus throwing most of the business over to the lower-margin side.
Challenges aside, Hennessy says he’s in it for the long haul, and claims to be more concerned about a shortage of lockers from his supplier in China than a dearth of expansion opportunities. DashLocker has posted a standing invitation to landlords on its website and is even offering licensing partnerships.
“I view this as a land grab,” Hennessy says. “It’s a green field out there.”
It’s a good thing there’s money in removing grass stains.