The crisis has sown “seeds” of new possibilities
The last desk memo in 2020 was titled “Never come back, 2020.” As we draw near the end of 2021, we wonder if 2021 was as bad as 2020. Even though 2021 surely qualifies as one of the hardest years, it has sown “seeds” of promise for 2022.
One third retired or closed
Even though it is not an accurate estimate, the number of dry cleaners has gone down by a third for the last 5 years. This estimate is based on the number of subscribers of industry newspapers.
Our industry has been in a long downturn for the last 10 years and more and more dry cleaners couldn’t sell their stores when they retired. The pandemic in 2020 dealt a finishing blow to weakened stores. I still remember vividly the voice of one of our readers who called us to stop send him the magazine since the pandemic has beaten me. He was a subscriber since 1993.
Even though the pandemic is still here, most dry cleaners’ business came back to pre-pandemic level thanks to the attitude change of “with Corona” sentiment. Some are even reporting increased sales thanks to less competition and higher prices.
The dry cleaning market is shrinking but with number of cleaners back to 1980’s level, the share of the pie for those who survived the pandemic will be greater for sure.
Increased consumer spending during the pandemic and booming restaurant business as well as resuming parties and event will also help our business
Price increase
The dry cleaners have been notoriously hesitant when it came to price increases. But prices of hangers, poly bags, chemicals as well as general inflation including the gasoline have gone up, not to mention worker shortage. The situation has finally forced most dry cleaners to raise their prices for the first time in who knows how many years.
Since the number of dry cleaners has gone down significantly, competition has become less of a concern than before.
According to LA Times, dry cleaning prices has gone up 6.9% compared to last year. If that is true, dry cleaning prices need to go up even higher. It is barely enough to cover the general price increase of 6.2% for the same period.
Considering how much prices of supplies, utilities, wage, solvent and gasoline have gone up, we need to raise our prices by at least 10% more.
Some will be worried that will drive away customers. But if you want to survive in the post-pandemic market, you have to make up for the increased expenses.
Since all the media is reporting how prices are going up due to the pandemic, customers will be more understanding of our price increase.
Can Korean dry cleaners become younger?
As many first generation Korean dry cleaners are retiring, not enough new blood is coming in to fill their shoes. If this trend continues, Koreans will have to hand over the title of “the largest segment” to some other nationality.
One might hope that bright young Korean entrepreneurs will once again find dry cleaning appealing since the competition has gone down so much.
When that happens, they will be more active with on-line presence and help improve the image of our industry.
We are finally seeing the light at the end of the tunnel. And there is no doubt 2022 will be better than 2021. The year 2022 can become the year Korean dry cleaning industry was reborn. The year of the tiger is just around the corner. It is time we became stronger.
