Ohio Dry-cleaning Franchise Plans To Expand In Utah

Wednesday, April 15, 2009

An East Coast-based dry-cleaning chain is making its debut in Utah with the addition of at least 15 stores over the next three years. Five of those will be located in Utah County.

Loveland, Ohio-based Martinizing Dry Cleaning, through its Utah franchisee Scott Ray, will open its first four stores in Sandy, Bountiful and Centerville as early as this summer. Other locations, each to be staffed by six to 10 workers, are planned in Utah, Salt Lake, Davis, Weber, Washington and Summit counties by 2012.

A 2,000-square-foot dry-cleaning plant will open in Highland by mid-summer of 2010, along with four retail stores, each averaging between 1,000 square feet and 1,100 square feet, in Provo, Orem and American Fork. About 100 new jobs will be added in Utah, including 30 in Utah County. Each store requires an initial investment of between $325,000 and $450,000.

George Strike, chairman and chief executive of the company, attributes the company's success to being conservative in adding new stores.

"Those that aren't successful expanded too rapidly as opposed to building a solid foundation of growth over the years. Some of the biggest casualties in dry-cleaning business are multi-store operations that either have not had a proper business model or tried to expand rapidly," he said.

To date, Martinizing Dry Cleaning has more than 600 stores companywide and has development agreements with its franchisees for 140 more over the next four to five years.

Despite the recession, Martinizing has maintained good growth in part because the company's target demographic is middle- to upper-middle income households in affluent neighborhoods, said Strike, a Salt Lake City native, who has a business administration degree from the University of Utah.

"Appearance remains important in maintaining a job. People may cut back on expanding their wardrobe, but they still want to look well-groomed," Strike said. "A number of retail establishments including dry cleaners have gone out of business or are reducing locations, and our franchisees can pick up incremental volume from those who have gone out of business." That Martinizing Dry Cleaning appeared to be a somewhat recession-proof franchise operation appealed to Ray, 46, who also operates as a contractor for Deutsche Post AG (DHL), especially after DHL announced in November it would cut back its domestic service shipments and restructured its nationwide operations.

DHL said it would slash 9,500 jobs and halt U.S. domestic services at its DHL Express unit after failing for five years to gain share in a market dominated by United Parcel Service Inc. and FedEx Corp. The U.S. job cuts come on top of 5,400 layoffs already this year, leaving between 3,000 and 4,000 U.S. employees.

Although Ray, a Layton resident, said he is one of DHL's 18 remaining contractors after the restructuring, he decided to diversify to other businesses.

"Owning a business for over 20 years and finding out it could be closed down at a moment's notice definitely made me re-evaluate my plans for the future," Ray said. "I've considered several franchises including food, home painting, sports training and day care. But Martinizing is the one that appealed to me and fits Utah's demographics." The company is currently seeking free-standing or grocery-anchored shopping-center sites of at least 1,800 square feet with drive-through possibilities in white-collar, affluent areas in Utah, as well as smaller satellite sites between 800 square feet and 1,000 square feet.

Founded in 1949 as Martin Equipment Co. in Buffalo, N.Y., the company was acquired by American Laundry Machinery Co. in 1951. The merged entity's corporate headquarters relocated to Ohio and became Martin Franchise Sales Inc. doing business as Martinizing Dry Cleaning.

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