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About Freedom From Laundry
In the Chattanooga, Tennessee area, Cents customer Freedom From Laundry demonstrated how strategic planning and innovative thinking could transform a laundry business. Starting in 2019, owners Aprill Ashley and her husband Shane began operations by renting space and using the adjacent coin laundry for processing. The business quickly gained momentum, leading to the construction of their own commercial laundry location. Within a year, they doubled their facility size. Their growth continued as they purchased the same laundromat they had originally worked alongside, giving them additional space to expand their service offerings to include both pickup and delivery (PUD) and wash-and-fold services.
The Problem
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Despite steady growth, Aprill faced several operational challenges that impacted business efficiency.
Observations revealed a concerning pattern where employees would unnecessarily extend their work hours to fill their shifts, even when tasks could be completed more efficiently. The traditional hourly wage system provided little motivation for workers to increase their pace, leading to inflated operational costs and reduced productivity.
"I could watch on the camera and kind of see everybody was in slow motion," Aprill recalls. "I was like, okay, how can I incentivize them? How can I make it something that they want to do? In business you always want to make it a win-win." The challenge was clear: create a system that would benefit both employees and the business while improving overall efficiency.
The Solution
After researching industry best practices and consulting with other laundry professionals, Aprill developed a unique pound-based payment system. Through careful analysis of productivity data and existing labor costs, she established sustainable rates that aligned with her service pricing.
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New employees began with a 60-day hourly rate period, focusing on training and building speed before transitioning to pound-based compensation. The payment structure varied by service type: commercial services at $0.50/lb (billed at $1.90/lb) and residential services at $0.70/lb (billed at $2.49/lb or higher), reflecting the different complexity levels of each service.
The team created reporting to track each order's weight, processing time, and labor costs, comparing commercial and residential services. This data-driven approach led to optimized rates that better reflected the different processing requirements of each service type.
The Outcome
Initial results exceeded expectations when the first payroll hit under the new system. Employees earned $24 to $100 more per paycheck while working fewer hours, quickly transforming any initial skepticism into enthusiasm for the new approach.
The impact was both immediate and substantial across operations. Staff who previously processed 140 pounds of laundry in 8 hours now completed the same volume in 5.5 hours. This dramatic improvement in productivity increased processing capacity while bringing labor costs to a stable 24-25% of sales.
The new system transformed workflow efficiency. When workers completed their assigned pounds faster, they could take on additional volume or end their day early. This flexibility eliminated facility idle time and improved resource utilization. Most importantly, faster processing times led to quicker turnaround for customers, enhancing both service quality and customer satisfaction.
Best Practices and Recommendations
In Aprill's Words
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"What I would say is, really know your numbers, truly know your numbers," Aprill emphasizes when asked what advice she'd give to other operators. She stresses the importance of approaching any new system as a collaborative effort: "Be transparent and upfront with your team and let them know this is something that we're truly trying. We're gonna probably have to tweak it along the way."
Her experience shows that initial uncertainty shouldn't deter innovation. "It was a little scary," she admits, "but everybody's happier. They've all gotten bonuses, gotten more per pay period than they would have. But you'll see from my numbers that it's been more cost effective for us as well."
Key Takeaways
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Know your numbers: Deep understanding of operational costs, processing times, and service-specific requirements is essential before implementing a pound-based payment system.
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Start simple, then refine: Begin with a basic structure and refine based on data. Freedom From Laundry started with a flat rate before evolving to service-specific rates that better reflected processing requirements.
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Plan for seasonality: Build flexibility into the system to handle volume fluctuations, particularly during slower periods. This might include offering optional days off while maintaining earning opportunities.
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Maintain clear tracking: Develop robust systems to monitor productivity, costs, and profitability across different service types. This data enables informed adjustments to the payment structure.
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Focus on results: The system succeeded by aligning employee incentives with business goals - workers earned more while working fewer hours, processing times decreased, and labor costs stabilized at 24-25% of sales.
