10 challenges in the on-demand laundry sector

The current players in the market serve Tier I and II cities, typically charge on a per kg basis, and deliver washed and dry-cleaned clothes between 24 and 48 hours from the time of collection.

Business books mention laundry among the top 10 business ideas to be explored. Retail products with high profit margins Nominal capital required, no-entry barriers, huge neighbourhood market and good returns generally make it a hot business idea. High profit business with low investment Yet none of them mention the difficulties in scaling, owing to a large number of uncertainties.

High profit business india It’s the easiest difficult business to be in.

#1. Low budget high profit business in india Low margin business – A customer is far more likely to go out of his way to find a good doctor than a good housekeeper or dry cleaner. High profit low cost business While customers generally prefer to have their laundry delivered at home, willingness to pay extra for it is unlikely. Business with high profit in india The challenge is to find a sustainable customer pool ready to pay an incremental price for this convenience or have individual service providers give bulk discounts.

#2. Low investment high profit business in hyderabad Shortage of skilled labour – Dependence on skilled labour leads to a greater cost of human capital. High profit items to sell on amazon Even after introducing software and machinery, dependence on manual work is not eliminated. Best business ideas with high profit in india The industry is trying to solve the challenge of empowering and rewarding labourers with a fair wage. High profit margin items After all, they do the weight lifting and hard work. Highest profit margin items on ebay Until they’re not paid more than what they can earn on their own, there’ll be a shortage of skilled labour. Low cost high profit products Most players underestimate the cost of retaining and hiring a trained workforce.

#3. High profit items to sell on ebay Optimising real estate – With on-demand, the infrastructure is optimised by removing the customer facing properties and moving the operations to economic industrial warehouses. Business with high profit margins in india For example, on-demand grocery startups deliver groceries straight from a warehouse. Ebay products with highest profit margin This removes the need of urban storage infrastructure, which is pushed out to cost-effective warehouses. High profit business ideas philippines For long-term success, the cost of logistics should be lower than the real estate cost.

#4. Low investment business with high profit in chennai Variables and customer experience – Laundry has many processes attached to it that require human interference. Small business low investment high profit The customer expectation is high and chances of errors are equally high since the process cannot be completely automated. Best business with highest profit margin Customising the customer experience is a huge task in itself.

#5. High profit jobs High risk-reward ratio – The risk associated with this business does not convert into a proper reward. High profit items to sell online For example, suppose that an on-demand service processes 100 sarees a day and charges Rs 100 each. Business with low investment and high profit in india Total revenue is thus Rs 10,000 and the margin is 30%, so the profit is Rs. High profit business ideas uk 3,000. High profit margin products Given that the operation is manual, there is (at least) a 1% chance of something going wrong. Low cost business ideas with high profit philippines That is, at least one in 100 sarees will get damaged. Low startup high profit business If the damaged saree costs Rs 3,000 and has to be paid to the unhappy customer, the entire profit on 100 sarees gets wiped out. High profit products In other words, 100 sarees have to be processed, just to earn Rs 3,000 – but with even 1% error, the cost of settling a claim is equal to the profit. Low investment high profit business in kolkata Thus the risk-reward ratio is too high.

#6. High profit margin products to sell Consolidating and capturing the market is difficult – This market is dominated by local dhobis, dry cleaners and maids. High profit selling pdf Finding ways to attract this skilled labour and add their existing customers to the on-demand laundry platform (for convenience and value) is the biggest challenge for consolidating and capturing this market. Items with highest profit margin on ebay Discounts help in attracting new customers. Low startup cost high profit business Business models where the profits can be shared with the people doing the actual work still have to be worked out.

#7. Business ideas with high profit margins Challenges in the backend – Out of every 100 customers, there will be at least one unsatisfied one. Highest profit business in india While they can be easily attracted by offering discounts and through online and offline marketing, retaining them is the challenge.

The actual operations are conducted in the back-end, which is operated by skilled labour that’s hard to attract and retain, as explained above. Low investment high profit business philippines The backend operations have to be scaled at a speed proportional to month-on-month customer growth. High profit business to start The shortage of skilled labour and the variables attached to dry cleaning prevent the expansion of the backend keeping pace with frontend growth.

#8. High profit shares in india Outsourcing (aggregator) backend – Many on-demand players act as aggregators. Low cost high profit business ideas They outsource their business to the local dry cleaners in their respective areas. High profit business ideas in india Outsourced services lack the edge in terms of quality that an in-house team delivers, especially in an on-demand vertical.

#9. High profit margin business Low customer retention – A large number of variables, plenty of options (both online and offline) and low customer loyalty sum up to low customer retention.

Although the on-demand laundry is growing, the many variables (discussed above) pose a lot of challenges but, on the brighter side, there are winners are emerging in this space. High profit small business Kudos to all the entrepreneurs who’ve entered this ‘not-so-sexy’ industry and are doing exceptionally well.

(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)

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