Professional Laundry Equipment Trading and 
Tie up with the Local Manufacturer

 

Introduction:

Though there are lots of manufacturers entering into the manufacturing of laundry equipment in the last two decades, the demand in the laundry equipment is still increasing due to the new start-ups plunging into this business.

It is observed that the Indian market is cost-sensitive and also there is a mistrust in the laundry equipment manufacturers. It has been seen that there are so many manufacturers of the equipment have failed to provide timely delivery, provide timely after-sales support and are slowly losing their reputation and grip on the market.

Many big manufacturers have lost trust in the market to help them keep active in this business. As this sector is very closely reviewed by the users their feedback can only help sustain this industry in the market. 

 

Factors that help sustain the market:

1.     Customer Satisfaction

The factors which help in the expansion of this industry are the reference (Feed-back) of the user, competitive cost, best and long term guarantee of after-sales service.

It should be the practice of the manufacturer to see that not a single user should be left unhappy with the use of the equipment. Happier customers should supersede the number of difficult customers.  

     2.      Market Presence

Digital presence is the essence of doing business in today’s marketplace. It is Lucrative to have an interactive website, along with presence on IndiaMart, India Today and similar platforms.

Advertisements through Facebook, Instagram, Telegram and YouTube with continuous updates on a regular basis can help increase the visibility of the organization.

Below is a small idea of how to start trading the laundry equipment.

Due to the slow Indian market, it is always better to keep the lowest possible cost of the equipment and work on the turn-over business.

Finding the quality manufacturer, who is ready to manufacture equipment as per our required standards. Ready to punch our logo whenever ordered for the equipment.

 

Requirement from the manufacturer.

1.     Manufacturers guide mentioning the following details.

A.                The gauge of the material used for the body of the equipment.

B.                 The thickness of the drum used.

C.                 Grade of the material used to manufacture the drum.

D.                Method of perforation.

E.                 Motors associated with spin and blowers with make and the capacities.

F.                  M.S material used(Frame) to mount the equipment.

G.                Microprocessor used with pre-installed and expansion availability of the number

            of the programs used.

H.                Dosing system and method used.

I.                    Grade of the molded plastic material used.

J.                   Size(Dimensions) of the equipment. Etc.

K.                 Service agreement for the next three years after-sales.

All this is required with the rates offered to us.

 

Calculations:

Keeping 30% of the profit margin over the manufacturer cost to the manufacturer after calculating his profit margins.

Now, let us say that the equipment is sold keeping 30% of gross margins.

 

For example:

The cost of manufactured equipment for our company is 300,000/- (Three Lakhs). Then this equipment will be further sold at 390,000/-(Three Lakhs Ninety Thousand Only). Keeping 90,000/- as gross profit.

If a minimum of six types of equipment (assuming the same cost) is sold in a month initially, then 540,000/-(Five Lakhs Forty Thousand) will be our gross profit to the company per month.

Note: Here, as the manufacturer, he is taking care of service for the next three years, so we can concentrate on selling the equipment. 

The marketing cost should not be more than 20% of the gross margins including the salaries and digital marketing cost.

 

Consider a year-long sale. (Considering Main types of equipment)

 

Equipment	Net Cost	Selling Price	Gross Margin
Washerextractor	24 x 3L    =72L	24 x 3.9L=93.6L	21.6L
Tumble Dryer	24 x 3L    =72L	24 x 3.9L=93.6L	21.6L
VFT	24 x 0.4L =9.6L	24 x 0.60L=14.4L	4.8L
FWI	12 x 3L    =36L	12 x 3.9L=46.8L	10.8L
	Total	248L	58.8L

After lockdown, there may be lots of laundry business startups, who started their business before COVID but could not sustain their business because of financial breakdown. 

To help him out with the sale of his equipment to the genuine buyer, one can start the trading business of laundry equipment.