Business Today

Washing machine dhobi

Incubation, CEO and start-up are terms you associate with novel business ideas-not with the neighbourhood dhobi or laundry service.

Anamika Butalia        Print Edition: June 27, 2010

Incubation, CEO and start-up are terms you associate with novel business ideas-not with the neighbourhood dhobi or laundry service.

But Akshay Mehra is proud to be the CEO of Village Laundry Service (VLS), an inexpensive laundry chain incubated by Innosight Ventures. VLS (the Village in the name comes from their services targeted at low-income groups), which aims to service the suburbs of metros, opened its first outlet in February 2009, in Bangalore. It was so popular that two more outlets opened by April.

"The business is focussed on providing quality services at convenient, easy-to-access locations. We present an excellent customer experience using premium detergent and highefficiency, eco-friendly front-loading washing and drying machines," says Mehra, 35.

Chamak (as the service is branded) outlets wash, dry and iron your laundry in 24 hours, at a rate of Rs 50 a kg (roughly four shirts and three trousers). VLS' target clientele: Students, young adults and middle- and lowerincome families.

Mehra, an IIM-Calcutta graduate, gained extensive experience in the laundry services segment during his days at Procter & Gamble as Brand Manager for Ariel and Tide detergents across India and ASEAN countries.

It was then that he realised the potential of a business that could bridge the gap between the common dhobi and the much-costlier branded laundry and 'dry cleaning' shops, with a quality service.

The overwhelming response to the first Chamak confirmed VLS' potential. By April 2010, it had 25 centres in place, across Mumbai, Mysore and Bangalore. The company's revenues grew 29 times from April 2009 to April 2010, and it expects to make an operational profit by June 2010.

The Chamaks keep in touch with their customer via SMS with mobile receipts on weight of the clothes and the billed amount. To ensure quality standards, VLS calls up its customers for feedback.

Scale? "The aim is to operate from 1,400 locations with Rs 60 crore in revenue," says Mehra. "We are also looking to go international to other emerging markets like Vietnam, Indonesia and Mexico to cater to similar need gaps in this growing industry."

FOCUS: Laundry services

FUNDING: Innosight Ventures

ADDRESSABLE MARKET: Rs 3,000 crore

BREAK-EVEN BY: June 2010

BIGGEST RISK: Ensuring quality and customer satisfaction as it expands, and quality training for each employee

THE BEST ADVICE I GOT AND FROM WHOM: The key at a start-up is to quickly recognise the issue, learn from it, and have the ability to pivot the business model - Scott Anthony, MD, Innosight Ventures

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