Sentiment on High-End Dry Cleaning

April 02, 2023

by a searcher from Northeastern University in Miami, FL, USA

Does anybody have experience owning and operating a dry cleaning business? I'm particularly interested in businesses that specialize in premium, couture garment clothing cleaning and alterations. Do wonder if this niche within the industry is worth pursuing?

Currently, I'm looking at a business where revenue is 30% from 5-star hotels and designer retail stores, and the other 70% are high-income households. The business also has the capacity to increase production without further investment. Finally, there's also an ongoing effort to ban PERC or PCE cleaning solvent in the US, the business already phased out the chemical, and runs an eco-friendly operation.

Looking at the IBISWorld report, here are the industry trends: (1) reduced demand for casual clothing dry cleaning, (2) increased demand for household laundry units, (3) increased demand for a relaxed dress code in the workplace, and (4) increased demand for low-maintenance clothing fabrics, such as cotton and polyester.

Any recommendations or feedback is greatly appreciated.

Thanks.

Reply by an investor
from University of Pennsylvania in New York, NY, USA

We provide software to the commercial laundry space (industrial launderers of hospitals and hotels). We overlap a little with dry cleaning as several of our customers also have household dry-cleaning operations or a guest valet service. We've avoided going into dry cleaning because the general sentiment is that it has been declining continuously since the 1970s. The primary driver is a consumer demand driven switch to fabrics that don't require dry-cleaning. Covid-19 and the work from home caused this trend to accelerate. You would need to have a very strong tactical game plan to drive growth with such negative macro trends. If you have a good plan would love to talk more and potentially invest.

Reply by a professional
from Villanova University in West Chester, PA, USA

Hi! The real estate component of securing new locations or maintaining existing locations can be challenging as dry cleaners have historically been something most landlords stray away from due to the environmental issues. That’s great they’ve phased out of those chemicals, but there may still be some landlords that aren’t interested in having a dry cleaning business as a tenant. I’d be happy to chat further.

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