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The Company Quietly Taking Over Every Layer of the Laundromat Industry- The Alliance Playbook — Transcript

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0:00In August of 2024, the biggest company
0:03in our industry wrote a check for $900
0:06million, nearly a billion dollars, not
0:10to build a factory, not to develop a new
0:12washer, not to lower prices for
0:14laundromat owners like you. They
0:17borrowed that money, added it to the
0:19company's debt, and paid it out to their
0:21private equity owner. $900 million out
0:25the door 14 months before taking the
0:28company public. And here's the part that
0:30should really get your attention. Over
0:32the two years since then, that same
0:34company has been paying that debt back
0:36down using profits that come in part
0:38from every washer you buy, every loan
0:41you take out with them, and every price
0:43increase you've absorbed. The Wall
0:45Street calls this strengthening the
0:47balance sheet. That's a direct quote.
0:49Their credit rating agencies love it,
0:52and their stock is up. But nobody, and I
0:55mean nobody, has sat down and asked what
0:58it means for the 40,000 laundromat
1:01owners on the other end of that supply
1:03chain. That's you and me. And that's
1:05exactly what we're going to do today.
1:06This is the deepest dive we've ever done
1:08on this show into a single company. It's
1:10Alliance Laundry Holdings, the maker of
1:12Speed Queen, Unimac, Hitch, Primus, and
1:16Ipso. The company that controls roughly
1:1940% of the commercial laundry market in
1:22North America. And as you're going to
1:24hear, a company that is now quietly
1:28operating on five different fronts in
1:30this industry at the same time.
1:32Manufacturing is just the one that you
1:34can see. By the end of this episode, I'm
1:37going to show you all five fronts. I'm
1:39going to tell you what I think their
1:41next three moves are, and I'm going to
1:43give you a five-point checklist to
1:45protect your business as a laundromat
1:48owner. And stick around for front number
1:50five because when I found it during my
1:52research, I literally stopped and reread
1:54it three times. It's the one nobody in
1:57this industry is talking about and it's
1:59personal. So, let's go.
2:02So, who is Alliance really? Let's set
2:05the table because I'd bet most owners
2:07know the brands, but not the machine
2:09behind them. Alliance Laundry Holdings
2:12was founded in 1908. It's not a typo.
2:16118 years ago in Ripen, Wisconsin.
2:20Population about 7,500 people. And that
2:24little town is still their global
2:25headquarters today, running an operation
2:28that serves roughly 150 countries with
2:31over 4,000 employees. Here's the scale
2:34and plane numbers. And these come
2:37straight from their SEC filings and
2:39earnings reports. about $1.75 billion in
2:43annual revenue and climbing. Roughly 40%
2:47of the North American commercial laundry
2:49market. Their own IPO perspective says
2:52that they're about twice the size of the
2:54number two player. Over 8 million
2:56machines installed worldwide. Five
2:59brands covering every corner of the
3:01market. Speed Queen for laundromats and
3:03homes. Unimac for onremise laundry. Hips
3:06Primus and Ipso. Now, quick history that
3:09matters for everything else in this
3:11episode. In 2015, a private equity firm
3:14called BDT Capital Partners, now it's
3:17BDT and MSD Partners, bought Alliance.
3:21If the name MSD rings a bell, that's
3:24Michael Dell's family office money.
3:26These are serious, patient,
3:28sophisticated investors. And they held
3:30it for 10 years, a classic private
3:32equity timeline. And in October of 2025,
3:36they took Alliance public on the New
3:38York Stock Exchange under ticker ALH,
3:41Alliance Laundry Holdings. The IPO,
3:43priced at $22 a share, raised over $826
3:48million, and actually it's about 950
3:52million once the overallotment closed.
3:54And the stock popped almost 13% on day
3:57one. Today, the company is worth about
4:00$5 billion. And just for your reference,
4:03today as I'm recording this, their their
4:05ticker for ALH is $25.86.
4:10That's up from their initial public
4:11offering. But here's what most people
4:13missed in the IPO excitement. And it's
4:16the whole detail that unlocks this whole
4:18story. BDT didn't sell out when they
4:22went public. They kept roughly 74% of
4:24the company under New York Stock
4:27Exchange rules. That makes Alliance
4:29what's called a controlled company. It's
4:31public stock, private control. A private
4:34equity firm steers the ship. They just
4:37invited public shareholders aboard and
4:39gave them very liquid way to sell down
4:42over time. And remember that 900 million
4:45from the cold open. That dividend went
4:48to BDT in August of 2024, funded with
4:52debt loaded onto Alliance's books. Then
4:55a chunk of the IPO money, money from
4:57public investors went to paying that
5:00debt down. That sequence feels a little
5:03bit like watching someone else's poker
5:05game where you're somehow the ante. Hold
5:08that feeling because it sets up
5:09everything Alliance has done since then,
5:12which we're going to get into here in a
5:13second. Quick pause. If you're listening
5:15to this and you own Speed Queen, Hips,
5:18or Unimac equipment right now, do me a
5:20favor. While you listen or watch, pull
5:23up whoever sold you those machines, the
5:26distributor that that sold them to you,
5:28and keep that name in your head. In
5:30about 10 minutes, I'm going to ask you
5:32some questions about them that might
5:34surprise you. Let's talk about the
5:36balance sheet story, what getting
5:38stronger actually looks like. Okay, so
5:41what is Alliance actually done since
5:43going public? In one sentence, they've
5:45been paying down debt at a sprint while
5:48growing at a run. the numbers from their
5:51earnings releases. The start of 2025
5:54about $2.1 billion in debt. The end of
5:582025 $1.4 billion. After the first
6:02quarter of 2026, $1.3 billion. They paid
6:07off another 65 million in just those
6:09three months. In finance terms, their
6:12net leverage debt compared to earning
6:14dropped from 2.8 times at the end of
6:17last year to 2.6 six times in Q1, and
6:20management says they're going to hit
6:22roughly two times by the end of this
6:24year. On their Q1 earnings call in May
6:282026, CFO Dean Nolan told analysts
6:31they'd quote, "Continue to strengthen
6:34our balance sheet and we're on track for
6:36the fullear target." And the market
6:38rewarded them. Just a few days ago, as I
6:41record this, June 29th, Moody's upgraded
6:45Alliance's credit rating from B2 to B1.
6:47I just reported that on the news
6:49episode. S&P had already upgraded them.
6:53What does that mean in practice?
6:55Borrowing gets cheaper for Alliance.
6:57Their cost of capital drops. Now, here's
7:00the crucial context, and this is where I
7:02want you to lean in here a little bit.
7:04This is not a struggling company
7:06tightening its belt. In the first
7:08quarter of 2026, Alliance grew revenue
7:1110% to $427 million. Net income more
7:16than tripled year-over-year to 57
7:19million. They beat Wall Street's earning
7:22expectations by about 15% and they raise
7:25their guidance for the year. So, picture
7:28this company for what it actually is.
7:30It's growing double digits. It's
7:32throwing off $80 million in operating
7:34cash flow a quarter. Paying down debt
7:37ahead of schedule with credit agencies
7:40applauding. This is a company building
7:43dry powder. Got to pay attention to
7:46this. And the question that matters for
7:48you is dry powder for what?
7:52Because on the same earnings call,
7:54management told us exactly what. They
7:57laid out a fourpillar capital plan and
8:00they said that once the debt target is
8:02hit, which is basically now the
8:04priorities shift to, and this is a
8:06quote, returning capital to
8:08shareholders,
8:09stock buybacks in the near term,
8:11dividends in the longer term. Okay, so
8:13let me translate that from Wall Street
8:16into Laundermat speak. When a dominant
8:18supplier pivots from pay down debt to
8:22protect earnings per share for
8:24shareholders, history across every
8:27industry says the same thing. Pricing
8:29discipline gets tighter, not looser. The
8:33days of your distributor having wiggle
8:35room to make a deal work. Those days are
8:38getting structurally shorter. Speaking
8:40of pricing, let's talk about what you're
8:43actually paying. Here's a fun exercise.
8:45On Alliance's Q1 earnings call, their
8:47CFO broke down that 10% revenue growth
8:50into its ingredients. Real unit volume,
8:53actual additional machines sold, was
8:55about 3%.
8:57Foreign currency added about 1%. The
9:00rest, the majority of the 10% growth of
9:04revenue came from price. Price.
9:08Now, Alliance frames this as defensive,
9:10and to be fair, some of it genuinely is.
9:12tariffs on steel and imported
9:14components. They're hitting them for
9:16about $20 million a year. They disclose
9:19four and a half to$5 million tariff bill
9:21in Q1 alone. Steel is their single
9:24biggest input cost. Those are real costs
9:26and their CFO said plainly that price
9:28increases taken in mid to late 2025 and
9:32again in early 2026 were designed to
9:35cover those costs. But do the math with
9:37me here because this is the tell. If
9:39pricing were only covering the $20
9:41million in tariffs, that's a little over
9:431% of revenue. Instead, pricing is
9:46driving the majority of that 10% growth.
9:49Their own CFO described the company's
9:51approach as, in his words, quote,
9:54rational pricing. And in their Q1
9:57slides, they proudly note that pricing
9:59quote successfully offset unquote tariff
10:03headwinds while North America still ran
10:05a 27% IBIDA margin. Listen, just to be
10:09clear, that's not a company scraping by
10:11on cost recovery. It's what economists
10:13call pricing power. The ability to raise
10:16prices faster than costs without losing
10:19customers. And you only get pricing
10:21power when your customers don't have
10:23anywhere else to go. Which in my mind
10:27raises the obvious question, do you have
10:30anywhere else to go? Hold that thought
10:32because some of my findings that I'm
10:33going to talk about in a few minutes
10:35here are really going to complicate that
10:36answer in a way you probably don't
10:38expect. So, what this means for you
10:41practically right now, if you're
10:44modeling a new store build or a
10:46retrofit, do not model flat equipment
10:49costs. A typical full equipment package,
10:51call it two dozen machines that ran 160
10:54to $210,000 installed a couple years
10:57back. It's been climbing steadily and
11:00every public signal from Alliance says
11:02the climb continues. When I run deal
11:05analysis with our clients that I do all
11:08the time from all over the country and
11:10other countries as well, we are now
11:12building price escalation into every
11:15equipment line item as a base case, not
11:18the downside case. I'd suggest that you
11:21do the same. And hey, if you've bought
11:23machines in the last 12 months, I'd love
11:25to hear what you actually paid versus
11:26what you were quoted two years ago. Uh
11:29because we're starting to see some of
11:31those prices stiffen up. And I've also
11:34seen quite a few quotes that are much
11:36much higher than what I would consider a
11:39a normal quote. Um, and I get to see
11:42quotes all over the place. Real numbers
11:46from real owners be any analyst report.
11:49And I'll tell you where to send that at
11:51the end of this show if you want to
11:53shoot over your quote and hear, you
11:55know, how it compares to other quotes
11:57that I've seen from around the country.
11:59Front number two, buying the middleman.
12:02Okay, remember I asked you to keep your
12:03distributor's name in your head? Here's
12:05the question. Do you know who owns them?
12:08Because there's a very real chance the
12:10answer has changed recently and you were
12:13never told in a way that made the stakes
12:15clear.
12:17Alliance sells through a network of
12:19roughly 600 independent distributors.
12:22the local businesses that quote you,
12:24finance you, install your machines,
12:26answer the phone when a bearing goes out
12:27at 900 pm on Saturday or doesn't answer
12:30the phone, more likely. Uh, for a
12:33hundred years, those were mostly
12:35independent, familyowned businesses.
12:38However, starting in 2023 and
12:41accelerating hard, Alliance has been
12:43buying them straight from their SEC
12:46filings. Once again, this is from the
12:48horse's mouth. Here's the timeline that
12:50I've been able to dig up.
12:52November 2023, Taylor Houseman, Northern
12:56California.
12:57July 2024, Star Distributing Nashville.
13:01September 2024, LNR Laundry, Salt Lake
13:04City. October 2024, Bestway
13:07Distributing, Corona, California. Late
13:092025, Metropolitan Laundry, the leading
13:13distributor in Metro New York. March
13:162026, Super Launda, also New York,
13:18folded into the same New York metro
13:20office as the Metropolitan. That's six
13:23distributor acquisitions in about two
13:25and a half years, including two in New
13:28York City alone, one of the biggest
13:30laundromat markets in America, and I'd
13:32argue in the world. When they announced
13:35the super laundry deal, Alliance's VP
13:37for the region called it, this is a
13:39quote, perfect complement unquote, to
13:43the Metropolitan deal, promising quote,
13:46next level service and support. And
13:48look, I do want to be fair here because
13:50I always want to be fair with you and
13:52with Alliance, consolidated operations
13:55often genuinely do mean better parts
13:58inventory, more technicians, faster
14:00response. Too soon to tell if that's
14:03going to be the case. Um, but some
14:05owners in these markets will experience
14:07real improvements. And I'm not here to
14:09tell you the sky is falling. That's for
14:10sure. I'm just trying to tell you what's
14:12going on in the industry. In every one
14:14of those markets, the number of
14:15independent voices between you and the
14:18manufacturer just went down by one. When
14:20your distributor is owned by the
14:22manufacturer, here's some of the
14:23implications. The price is is the
14:26manufacturer's price. There's no
14:28independent business person deciding to
14:30shave margin to win your deal against
14:32the shop across town. The financing
14:35offer is the manufacturer's financing
14:37offer, which it has been for a long
14:39time. So, that really isn't changing too
14:41much. And when you're negotiating a big
14:43package, you are functionally
14:45negotiating with a $5 billion public
14:48company that reports its margins to Wall
14:50Street every 90 days.
14:53Now, here's where the story takes a
14:55turn. That was kind of surprising to me,
14:57actually, because when I started looking
14:59into this, I assumed Alliance was the
15:02only one playing this game, and they're
15:03not. There's a second consolidator
15:06buying up laundry distributors across
15:08America, a company most laundromat
15:10owners have never even heard of, and I
15:13have been watching for a little bit now.
15:16And whether you end up better or worse
15:17off in the next five years may depend on
15:19which one gets to your market first
15:22potentially. So let me introduce you the
15:25counterweight EVI Industries. There's a
15:28publicly traded company out of Miami
15:30called EVI Industries. Their stock
15:33ticker is EVI for obvious reasons. And
15:36since 2016, under a CEO named Henry
15:39Namad, they have quietly made 32
15:42acquisitions of commercial laundry
15:44distributors and service companies. 32.
15:48Their revenue has grown roughly 10 times
15:50over that stretch to about $390 million
15:54a year. And they now hold an estimated
15:579% of North American laundry
15:59distribution, the largest distributor on
16:01the continent.
16:03You may have never even heard of EVI
16:06because well that's by design. When they
16:09buy a distributor, they keep the local
16:11name, keep the team, keep the owner
16:13running it. The customer often barely
16:15notices. Their recent deals include ASN
16:18Laundry Group in New York, Baleni in
16:21Ohio, and this is a big one, their
16:23largest acquisition ever in 2025, Jabrow
16:27North America, the US arm of the Spanish
16:29equipment maker, now rebranded as, you
16:32probably heard of it as Continental
16:33Jabrow or Continental Laundry Solutions,
16:36adding about $50 million in annual
16:38revenue. So, stop and appreciate this
16:42chessboard we've got going on for a
16:44second here, because this is wild. The
16:46same 12 months, one equipment
16:49manufacturer, Alliance, was buying
16:51distributors while another manufacturer,
16:54Jabrow, sold its distribution arm to a
16:57distributor. The whole middle layer of
17:00this industry is being carved up from
17:02both ends. But here's the difference
17:04that might matter enormously for you,
17:06and it's the reason I call EVI the
17:08counterwe in this situation. Alliance
17:11owned distribution sells Alliance
17:14equipment. One manufacturer, one brand
17:17family, one pricing philosophy. EVI own
17:21distribution is multi-brand. Their
17:24subsidiaries can quote you on Alliance
17:26Equipment, Jabrow, Milner, Dexter,
17:28whoever fits your project. And EVI makes
17:31money either way. Their whole pitch to
17:33Wall Street is being the trusted advisor
17:36layer. Nimad literally says, this is a
17:39quote, "Customers do not buy brands.
17:42They buy trust, relationships, and
17:44expertise."
17:46True or not true? I don't know. So, the
17:49real story of distribution in this
17:51industry is not Alliance takes over.
17:55It's this. The era of the truly
17:57independent mom and pop distributor
18:00seems to be coming to an end and it's
18:03being replaced by two competing models.
18:05the manufacturerowned dealership versus
18:08the consolidated multibrand superstore.
18:11Industry analysts covering EVI have
18:14flagged exactly this tension.
18:16Manufacturers buying distributors
18:18squeeze multi-line players and
18:20everyone's racing for the best remaining
18:22independents. So, hey, that might be
18:24good news out there if you're a
18:26distributor, independent distributor
18:27looking to exit. Maybe maybe you got
18:30something coming your way. And by the
18:33way, the rest of the competitive field
18:35still exists. Dexter out of Iowa, Milner
18:38out of Louisiana, Electrolux
18:40Professional, Continental Jabrow, and
18:42now even LG and Whirlpool are pushing
18:44harder into commercial laundry.
18:46Globally, the top five equipment players
18:48hold over 70% of the market. Alliance is
18:52the giant, but it is not the only
18:55option. And honestly, keeping the
18:57alternatives healthy is partly in our
18:59hands, yours and mine. Every time you
19:02insist on a competitive quote, the
19:05single, this is this is important, okay?
19:07The single most actionable thing in this
19:09entire episode is this, and you know I'm
19:12all about action here. Find out who owns
19:15your distributor. Independent,
19:17allianceowned, or EVI owned. Each one
19:20changes your negotiating playbook. So,
19:23let's just talk about that for a second.
19:24If you have an independent distributor,
19:27you have the most flexibility. Nurture
19:29that relationship. some of that uh
19:32advice that's been given around and I've
19:34I've had a little bit of uh you know
19:36arguments about some of this with with
19:38other people who were talking about this
19:40in the industry um saying your
19:42distributor is one of your biggest
19:44assets or can be u well listen if you
19:47have an independent distributor and
19:49they're truly helpful nurture that
19:51relationship get quotes in writing while
19:54the getting is good because again prices
19:57are only going up and pricing
20:00is only getting more fixated. If you
20:03have an allianceowned distributor in
20:05your area, expect polished service and
20:08firm pricing. Always always price check
20:10against a multibrand alternative if you
20:13have the option, even from the next
20:15market over. And the this is this is
20:18huge because again, I have seen quotes
20:21that have been egregiously overpriced.
20:24Um, and you know, the the person getting
20:27the quote would never know it because
20:28they haven't seen any other quotes. And
20:30I just have the benefit of having seen
20:32lots of different quotes. Again, it
20:34might be interesting for us to share
20:35some of those quotes with each other so
20:38that we can know, you know, what
20:40everybody else is getting quoted on,
20:41whether or not we're getting a decent
20:43deal or not. EVI owned distributors, use
20:45the multibrand access. Make them earn
20:47the deal across brands. Seriously, go
20:50out and find out this week. And when you
20:52do, I'd love to hear what you found. I'm
20:56building a picture of how far this has
20:58spread market by market and our
20:59communities on the ground. Intel is
21:02better than anything I can pull up from
21:03SEC filings. You know, I'm doing a lot
21:06of research in a lot of different ways.
21:08But a lot of this information is coming
21:10from SEC filings, news reports, things
21:13like that. But when we get together,
21:15it's only going to benefit us. All
21:17right. Manufacturing, distribution,
21:20that's two fronts. Let's talk about the
21:22third one, the one where Alliance holds
21:24the paper on your business. Front three,
21:28the Bank of Speed Queen. Most owners
21:30think of Alliance as a machine company.
21:33They're also functionally one of the
21:35largest specialty lenders in the
21:36laundromat industry. Speed Queen
21:39Financial Services, Alliance's in-house
21:41financing arm, has originated roughly
21:44$2.8 8 billion in loans across some
21:4827,000 transactions by their own
21:51marketing. They'll finance up to 90% of
21:54a new store project. And here's one that
21:57raises my eyebrows every time I read it.
21:59They'll finance up to 80% of your
22:01purchase of an existing laundromat, even
22:03one full of a competitor's equipment.
22:07Think about why a manufacturer would do
22:09that. You buy a store today with their
22:11money. you replace the machines tomorrow
22:13with their machines. It's brilliant. And
22:16it's also a moat that they're building.
22:19They market a 96.85%
22:22success rate on their laundromat loans.
22:24And you've probably seen that number
22:26floating around uh or something similar
22:28to that. And this is based off charge
22:31offs from 2007 to 2022, which you know,
22:36credit where it's due is genu genuinely
22:38it's a strong stat. And a big reason
22:40financing through them is so easy. Right
22:43now they're running promos. Well, go
22:45look at them because these these things
22:48fluctuate all the time, but um a lot of
22:51times you can get pretty good deals on
22:54their financing terms. And it genuinely
22:56is probably the easiest way to get
22:57financing in this industry. And there's
22:59a layer deeper. Alliance scrutinizes
23:02these loans. In their Q1 filing, you'll
23:04find $21 million of restricted cash held
23:07for quote securitization investors,"
23:11unquote. Meaning, they bundle your
23:13equipment loans and sell them to Wall
23:14Street, freeing up capital to lend
23:16again. Your monthly payment is
23:19somebody's bond coupon. So, follow the
23:22full loop on a single transaction. Now,
23:24Alliance manufactures a washing machine.
23:27An allianceowned distribu distributor
23:30sells it to you. Speed Queen Financial
23:34finances it. The loan gets securitized
23:37for investors and the machine phones
23:39home to their software platform, which
23:42is front number four that we're going to
23:44talk about here in a second. The
23:46connected machine layer. Alliance now
23:48has over 250,000
23:51connected machines in the field. That's
23:53up from about 200,000 just at the IPO
23:56last fall. That's Speed Queen Insights,
23:59Hips Command, Unimat Core, and the rest.
24:02Their CEO, Mike Show, told analysts in
24:05May, quote, "Our integrated hardware
24:08software platform continues to
24:10differentiate us in the industry,
24:12driving growth and customer loyalty,"
24:14unquote. And in their SEC filings,
24:17digital subscriptions now show up as
24:19their own recurring revenue line, which
24:21a lot of you guys know about. Now, let
24:24me be straight with you. These tools are
24:27pretty good. Remote monitoring, mobile
24:29payment options, while not the best out
24:31there, is better than nothing. Loyalty
24:34programs that you could recommend. You
24:36know, I do recommend owners use some of
24:38this stuff. maybe maybe the insights,
24:43maybe a third-party program, but I do
24:45recommend that you use them um and
24:47especially on the payment systems and
24:49the data collection, all of that. But
24:51use it with clear eyes about two things.
24:54One, every month you run your store on
24:56their platform, you're switching costs
24:58to another brand goes up. And that is
25:00actually the point, and their CEO even
25:02said so. And two, think about what
25:05Alliance learns from a quarter million
25:08connected machines. Cycle counts,
25:10utilization, revenue p uh patterns,
25:14neighborhood by neighborhood. That's the
25:16best real-time data set on laundromat
25:18performance that has ever existed. And
25:21it's proprietary to the company that
25:23also well, it brings us front number
25:27five, which we're going to talk about.
25:28we've talked about before here. Uh, and
25:30we're going to jump into it because
25:32everything I've told you so far, the
25:34machines, the distributor, the loans,
25:36the software, all of that still puts
25:38Alliance on the supplier side of the
25:41table. Front five is where they cross
25:44over to your side of the table two
25:46different ways. This is the part I
25:48reread three times. I've been talking
25:51about it for a little while now, and
25:54you're probably at least familiar with
25:56it. Front five, competing with you and
25:59talking to your customers. Part one,
26:02they franchise laundromats. Now, Speed
26:05Queen Laundry franchises. Probably not
26:07news to most of you guys. You've
26:09probably seen them. You've probably
26:10heard the horror stories that Allianc
26:12has had no problem putting stores right
26:15across the street, literally from
26:18clients of theirs, customers of theirs
26:20who have purchased their machines, and
26:24there's been no respecting of boundaries
26:25there. branded corporate design, tech
26:28loaded retail laundromats, kids play
26:31areas, 247 staffing, app payments, the
26:34works. Total investment of these is
26:37usually $1.2 to $1.9 million from store
26:41per store just from uh talking with
26:44these store owners. and a franchise fee
26:47of around almost $50,000 with a minimum
26:50net worth requirement of about $2
26:52million and surprise up to 90% financing
26:57available inhouse. Their own franchise
27:00marketing sites FDD returns of 28 to 41%
27:05and describes the opportunity as
27:06transforming quote a fragmented unquote
27:10industry where quote 54% of locations
27:13are single store operations unquote.
27:17Read that sentence again from your seat.
27:20You are the fragmentation. We are the
27:23fragmentation. The manufacturer that
27:25supplies your equipment is recruiting
27:27well- capitalized investors to open
27:30branded corporately supported stores in
27:34the same trade areas as independents and
27:37describing the independence of this
27:39industry as the problem being solved.
27:43You hear that we what's being
27:46communicated here is that we are the
27:48problem being solved. here. Is a Speed
27:51Queen franchise opening next to you
27:54tomorrow? Probably not. The footprint is
27:57still small industrywide. That is true.
28:00But the strategic direction is
28:02unambiguous. And a company with a
28:04fortress balance sheet, a captive
28:07lender, and a $5 billion market cap has
28:11everything it needs to scale that model
28:13whenever it chooses.
28:16This is why I've been talking about
28:18this. so much and I know most people out
28:21there have not been affected by Speed
28:23Queen franchises at this point, but I'm
28:27watching what Tide is doing with their
28:29franchise, which we'll do another
28:30episode about Tide. Um, but they are uh
28:35selling locations by the handfuls and
28:38Speed Queen is set up to be able to do
28:41that as well and at least as quickly, if
28:44not even more quickly. Here's part two,
28:47though. This is the one nobody's talking
28:50about. They're building media. Listen,
28:53I'm coming from a media perspective.
28:54Lawn Resource is one of the first true
28:57media companies in our industry and I
29:02I'm watching what they're doing here,
29:03which I've heard nobody talking about
29:06and they're not they're not full court
29:08press in this yet. Um, but I want to
29:11talk about it a little bit and what some
29:12of the implications of this are.
29:15Alliance produces its own podcast for
29:17laundromat investors of owners. It's
29:18called Laundermat Nerd or Laundry Nerd
29:21uh podcast and it used to be called
29:23Laundmat Insights. They changed it to
29:26the Laundry Nerd uh podcast. It's
29:28produced by Alliance's own distribution
29:30arm featuring experts and owners talking
29:33ownership technology ROI strategies and
29:36they pair it with content marketing
29:38pushing that 96.85% 85% success stat,
29:42demographic analysis services, site
29:44selection, help, business planning
29:46tools. Does that sound familiar? It
29:49should. It's the same playbook every
29:52smart brand runs now. Own the audience,
29:55own the education, and you own the
29:57customer before they ever get a quote.
30:00When a brand new investor Googles how to
30:03buy a laundromat in 2027, Alliance
30:05intends to be the voice that answers.
30:08And the voice that answers happens to
30:10manufacture the machines, own the
30:12dealership, write the loan, run the
30:14software, and sell the franchises.
30:17Now, full transparency because, you
30:20know, that's how we do it here. I run a
30:23media business in this industry. Like I
30:25mentioned, Laund Resource is education
30:27and advisory for Laundermat owners. So,
30:29yes, alliance building a media funnel is
30:32in some sense alliance moving toward my
30:34lane too. uh not just with machines and
30:38the their data collection, all that
30:40stuff, but also in the media space. So,
30:42you should absolutely weigh that when
30:44you hear my take on this whole episode.
30:47But here's my honest take anyways, and
30:49I'd say this even if I sold surfboards
30:51for a living right here in Hawaii, the
30:54difference between manufacturer media
30:56and independent media is the difference
30:59between a brochure and a second opinion.
31:02Allianc's podcast is never going to run
31:04the episode you're listening to right
31:06now. Obviously, it's never going to tell
31:09you to get a competing quote from an EVI
31:12distributor or to check whether Dexter
31:14pencils out better for your store or to
31:16question whether 90% financing at a
31:19variable rate is actually good for you
31:21rather than good for them. Not because
31:24they're evil, because they're a
31:25supplier. Suppliers educate you toward
31:28the sale. That's their job. And we just
31:31need to know this. I've said this a lot
31:32of times, right? When we're talking with
31:34distributors or even brokers in our
31:36industry or even other people in our
31:38industry, we need to know where their
31:41motivations lie so that we can weigh how
31:46much we should pay attention to their
31:48voice. Right? And again, this is not to
31:50say they don't have anything valuable to
31:52add that they're giving you bad advice
31:53even. We just need to understand where
31:55their motivations come from. And their
31:57motivation clearly is to sell you
31:59equipment, to finance it for you, and
32:01maybe even to sell you a uh franchise
32:04store. Independent voices, this show,
32:07other creators in this space that you
32:08guys have probably seen and heard of,
32:11owner communities, the guys in the
32:13Facebook groups arguing about Vin
32:14pricing at midnight. That's the
32:16industry's immune system. Support it
32:19wherever you find it. That's my take on
32:22it at least. the other side of the table
32:24and where this all goes. One more piece
32:27to complete the picture, then I'll give
32:29you my predictions and your checklist of
32:31what you should be doing here. It's not
32:33just Alliance consolidating.
32:36Ownership is consolidating, too. Laundry
32:39Lab, Express Laundry Center, Regional
32:41Rollups, Tide Laundry, and others. And
32:44the big route operators like CSC Service
32:46Works and Wash are actively acquiring
32:49stores. Current market single store is
32:52trading around I'd say four to five and
32:55a half times SDE seller discretionary
32:58earnings. Multi-store platforms are more
33:01like four to six times IBIDA more with
33:04real estate. Even private equity money
33:07that spent the last decade rolling up
33:09dentists, HVAC, car wash companies and
33:12self- storage has discovered
33:14laundromats. Recession resistant,
33:16recurring cash flow, fragmented classic
33:19rollup raw material. I've been talking
33:21about this forever. So, zoom all the way
33:23out. Manufacturing consolidated top five
33:27holds 70 plus% globally. Distribution
33:31consolidating fast from two different
33:33directions. Financing increasingly
33:36captive. Software increasingly captive.
33:40Retail ownership consolidating.
33:43media now contested. Every single layer
33:46of this industry is concentrating at the
33:49same time. The only real wild card is
33:52Washington. The Federal Trade Commission
33:54and the Department of Justice has
33:55started scrutinizing serial rollup
33:57strategies across multiple industries,
34:00though nothing specific to launder yet.
34:02Just something to kind of keep an eye
34:04on. But here are my three predictions,
34:07and you can hold me to these. Clip this
34:09section and check back in 18 months to
34:12see whether or not I was right.
34:14Prediction one, the buyback era begins
34:18within 12 months and pricing gets
34:21firmer, not softer. Alliance hits their
34:242x leverage target around year end 2026.
34:28Management has already told analysts
34:30buybacks are next. Dividends are after
34:33that. Once earnings per share becomes
34:35the scoreboard, list price discipline
34:38becomes doctrine. No longer flimsy
34:42negotiable pricing for us. Maybe it'll
34:46lead to more price transparency. I don't
34:48know. That's a big beef I have with
34:51Alliance and everybody else in the
34:52industry. So, we'll see about that. But
34:55plan for equipment inflation to continue
34:58as the permanent base case. That's just
35:01going to be what it's going to be for
35:03us. All right, prediction two. The
35:06distributor land grab accelerates and
35:09your market picks a lane. Alliance and
35:12EVI are now openly racing for the best
35:15independent distributors. Cheaper debt
35:18after the credit upgrades only fuels it
35:20for Alliance. Within 3 to 5 years, I
35:24genuinely believe most major metros will
35:27be effectively two option markets.
35:29Alliance Direct or EVI Multibrand. The
35:34independents that remain will either be
35:37excellent or they'll be gone.Uun
35:40prediction three. The data flywheel
35:43becomes the real moat. A quarter million
35:46connected machines feeding usage data
35:49plus 27,000 loan files plus franchise
35:53site analytics. Alliance will know which
35:56corners of which cities support a
35:58laundromat better than any human broker
36:01alive. Expect that intelligence to show
36:04up in their franchise expansion, their
36:06lending decisions, and eventually mark
36:09this one in some kind of premium data or
36:12benchmarking products sold back to
36:14owners. When that launches, remember
36:16where you heard it first, right here.
36:19Okay, let me give you a five-point
36:21checklist. the what do I do of this
36:24whole episode because there's a lot of
36:26information I threw your way. I made
36:28some predictions, but all of it is like,
36:31okay, well, what do I do with this now?
36:33So, here's a few things. Here's five
36:35things that I think you should be doing.
36:37Number one, we talked about this
36:39already. Find out who owns your
36:41distributor or the distributors in your
36:43market. Do it this week. Independent
36:45Alliance or EVI changes everything about
36:48how you negotiate right now. and that's
36:50going to continue to change. So, just
36:53keep all that in mind. Okay. Number two,
36:55never take a single quote again. I don't
36:57know if you've been doing that. That was
36:58a big mistake I made early on uh as
37:01well, but that should not be something
37:04you do ever again if you've ever done
37:05that. Minimum two brands, two
37:08distribution channels on every
37:10meaningful equipment purchase. You're
37:12not just saving money. You're voting to
37:14keep competition alive in our own
37:17market. That is what we're doing here.
37:20Number three, always shop the financing
37:23separately from the equipment. Speed
37:26Queen Financial against your bank, SBA
37:28lender, a credit union. Sometimes the
37:31captive lender genuinely wins. Their
37:33approval rates are real. But make them
37:37win it. Okay? That doesn't mean don't go
37:39with their financing options. It means
37:42make sure they're giving you the best
37:44option for you. There's lots of
37:46different tools, lots of different ways
37:47to finance these things. Just make sure
37:50that they are your best option for your
37:53situation. All right, number four. Use
37:56the connected tools, your own data
37:58posture. Read what the platform
38:00agreements say about your store's data.
38:02Keep your own records outside of the
38:04platform whenever possible. And know
38:07your exit costs before you're all in.
38:09That data, I've been harping about this
38:11forever. That data is so important for
38:15you to have for your own stores, but
38:18it's going to be probably the most
38:20valuable asset, if it's not already,
38:23that Alliance and the other
38:24manufacturers have in their arsenal,
38:28even more so than all these other
38:29channels. That data is so so valuable.
38:32Okay. And number five, build price
38:35escalation into every deal model, every
38:37build, every retrofit, every
38:39acquisition. Pro for flat equipment
38:42pricing is a fantasy assumption in this
38:45market. All right, I know we've been
38:47through a lot here in this video, so let
38:49me land this way and I always try to
38:52honestly Alliance is not a villain. They
38:56make genuinely excellent machines. Their
38:58reliability record is real. Their
39:00warranties lead the industry. Their
39:02financing has put thousands of people
39:04into ownership who couldn't have gotten
39:06there otherwise. Some of you listening
39:09owe your first store to a Speed Queen
39:11loan, and that matters. All right,
39:13that's myself even. Uh my first
39:16equipment purchase was Speed Queen
39:18equipment.
39:20But great machines and concentrated
39:22power are both true at the same time.
39:26What's changed is that Alliance is no
39:28longer just your equipment supplier.
39:31They're now your supplier, potentially
39:33your distributor, possibly your lender,
39:36probably your software platform, maybe
39:39someday your competitor, and as of
39:41recently, a voice in your earbuds
39:44competing for your trust. Six
39:47relationships with one company that
39:49answers to Wall Street every 90 days. An
39:52informed owner isn't a scared owner. An
39:55informed owner is a dangerous
39:56negotiator. And that's what today was
39:59about. Now, here's how we're going to
40:02keep this conversation going if you're
40:03up for it. Because the story is going to
40:05keep developing. Alliance is going to
40:08keep doing what they're doing. And it's
40:10not just them. I want to keep tabs on
40:12what everybody's got going on. And I
40:15want us to do it together. So, first, go
40:18find out who owns your distributor. We
40:19talked about that a couple times
40:20already. I would love to hear who owns
40:24your distributor. Drop it in the
40:25comments. If you're watching on YouTube,
40:27shoot me an email, jordanlaresource.com.
40:30Address is in the show notes market
40:33byarket. We're going to build the real
40:35map of this consolidation and I'll share
40:37what we find on a future episode. I
40:40would love to do that. Have again that
40:42data is important for us to have as
40:45owners. Nobody is compiling it for us.
40:48So, we've got to be the ones to compile
40:49it. Second, if you bought equipment in
40:53the last year or two, I would love to
40:55for you to shoot me your real numbers.
40:57Like, what was your quote? What you paid
40:59versus what you were quoted. Um, you
41:01could do it anonymously. You could, you
41:03know, black out any information you
41:05don't want me or anybody else to see.
41:07Uh, but real owner data beats analyst
41:10reports every time. And I will make that
41:12information, all that data available for
41:15free for anybody who wants it. So, if
41:17you decide to contribute to that, again,
41:19Jordan joinatresource.com,
41:22would love uh to have that available. I
41:26know people have been talking about
41:27doing that forever and nobody's ever
41:28done it. So, maybe this is the uh the
41:30opportunity for us to jump in and do it.
41:33Okay. Third, inside the pro community.
41:35I'm opening up a dedicated thread on
41:37this alliance EVI distributor intel
41:40financing quotes people are actually
41:41getting. That's where the ongoing
41:43conversation lives between these
41:45episodes. So, if you're not in it yet,
41:47the links in the show notes,
41:48laundromatresource.com/pro,
41:51come join us over there and uh be a part
41:53of that conversation. And then fourth,
41:56if this episode made you think or was
41:59insightful in any way, I would love for
42:01you to send it to another owner in your
42:04market or or some posted in your
42:07Facebook group or whatever. Not for me.
42:10Uh I've I I don't think I've ever done
42:12this on any episode before. Um, but do
42:16it for our industry. Do it for the
42:18owners. For every owner uh out there
42:21that is trying to accomplish your goals,
42:24is trying to hit that financial freedom,
42:26is trying to replace the nineto-5, is
42:27trying to build cash flow, is trying to
42:29make a living and feed their family and
42:31and build the life of their dreams.
42:33Listen, every owner who understands this
42:35landscape makes the whole independent
42:37side of this industry harder to squeeze.
42:39I'm firmly on the side that independent
42:42ownership is not a problem to be solved
42:45in this industry. It's something to be
42:47nurtured in this industry. So, I
42:50genuinely think that the more of us that
42:52are engaged in this conversation that
42:54understand what's going on in our
42:55industry, it's going to benefit all of
42:57us more. and uh follow the show uh so
43:00you catch the followup because listen
43:02between BDT's next share sale, the next
43:05distributor deal, and that leverage
43:07target hitting a year in, I promise you
43:09there's going to be some follow-ups
43:10here. So stay sharp, run your numbers,
43:14keep building that freedom, and uh
43:16listen, this is Jordan with Lawnmat
43:18Resource, and we'll see you on the next
43:20one. Peace.

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