One of the cleanest, up to date, successful and well-run facilities I’ve visited is Z Cleaners, in Scottsdale, Az, owned and operated by Geralyn and Steven Phillips.
Not long ago, when Steven and I were talking about giving back to the industry, Steven said, “That’s a good point. I have given back to this industry. You see that Metalprogetti assembly conveyor? I was the very first drycleaner in the country to have that. Do you know how many drycleaners from across the country I’ve let into my plant to see my operation? “Did you know, I was the very first drycleaner in the United States to do bar coding on clothes?” Even after knowing him for decades, I replied, “No sir, I didn’t know any of that.”
That’s when I realized that, as an SDA Member, we needed to sit down and have a talk with Steven & Geralyn.
Jeff Schwarz, A.L. Wilson Chemical Company
What have been the key milestones or turning points in your journey with Z Cleaners and how did they shape your path to success?
a. The key milestone and turning point for our company was implementing Metalprogetti Conveyors, which I learned about at the 1997 Las Vegas Clean Show. The Assembly Conveyor allowed me to allocate more time towards developing and growing my business. Previous to the implementation of automation, the principle concern was centered around accurately producing garments ‘due’ for that day. If there was a hiccup in Assembly, that error would ripple through the work due for that day. Resolving those issues was a tremendous time and mental energy drain.
Automation gives the business owner a sense of predictability – greatly enhanced accuracy and zero employee concerns. The company’s success for that day was not dependent on whether or not your Assembler was absent that day (and a less qualified employee would fill-in).
These same comments apply to barcoding, Automated Storage Conveyors and Baggers. When used in combination, there is no greater way to improve the production cycle in any dry cleaning plant.
b. Accepting an invitation to be a part of America’s Best Cleaners (ABC). Working with Ed D’Elicio and the other members of ABC, we were able to see Z Cleaners from others’ point of view. This objective ‘look’ by others turbo-charged our goals and gave us a tremendous amount of confidence to pursue our business plan.
ABC afforded us the opportunity to have an up-close-and-personal look at successful cleaners throughout the country. One principle we took to heart was to concentrate on quality (NOT quantity), and charge accordingly.
Additionally, ABC (Ed D’elicio) taught us important management concepts as it pertains to tracking and understanding our P&L and what are the important numbers to focus on to maximize profitability.
Some of your friends say you were one of the first to introduce technology into your plant. What were some of those “firsts”?
a. Installing Automation in 1998:
Automated Storage conveyor with Automatic Loading
24/7 Kiosk – allowing pick-up and drop-off any day or time
Automated Assembly Conveyor
b. Normalizing the use of Miniature Barcodes in 2003.
Z Cleaners worked with Computype Identification Concepts (the original maker) to create the die tool that stamped-out the .25 X .75 heat seal barcodes, which did not exist prior to 2002. My decision to do it was unwavering, so we paid for the die tool ($1,346.00). Computype said they would repay me if the labels ‘took-off’. Well, that’s history, they have sold millions of labels, but I never was repaid.
c. Z Cleaners contracted with Spot Business Systems to create “Production Manager” in 2004.
Production Manager (PM) was integrated with the POS (Point of Sale) system and Metalprogetti conveyors. Using this, we could determine where an individual piece was throughout our Plant. PM also allowed us to introduce a very accurate ‘pay-per-piece’ compensation program for our employees. After paying for Spot to develop PM, Spot bought the rights to the computer code from me to further develop it and sell it to other dry cleaners.
d. Assisted Spot Business Systems in developing their Software to fully integrate with Metalprogetti Conveyors. As the first Metalprogetti user, I was integral in helping Spot Business Systems to integrate with Metalprogetti. I was hired by P & G to help set up their Juvian dry cleaning project and integrate Metalprogetti.
Can you share a specific failure or setback you encountered along the way, and how did you overcome it?
Expanding too fast. I was not immune from the belief (fantasy) that I could dominate dry cleaning in my market, so I expanded. I bought a small dry-store that had an extensive alterations department in Tempe, AZ; I built from scratch a second dry-store in Chandler AZ; I agreed to operate 7 “Kangaroo Cleaners” that were located inside Grocery Stores around the Valley; and I opened a second Plant.
I was naïve about ‘human nature’. I believed that my staff would have the same ‘focus’ I had in running and operating MY business. A hard lesson, but it has made me a better owner/operator today.
Early-on, I thought my success could be found by producing many pieces (a lot of volume) and relying solely on technology and employees. My strengths lie in producing a very high-quality product and personal attention to my customers. My strengths are NOT in managing multiple sites with dozens of employees. Thankfully, this became apparent early on. I overcame it by realizing my weaknesses and cutting my losses as fast as I could.
What strategies or habits do you believe contributed most to your success?
a. Starting from scratch and creating a thorough business plan. Everyone says a business plan is important, but for me, it was essential. I took a semester-long class, bought a Plan Writing Guide and took about 18 months to write it. Putting my thoughts on paper allowed me to clarify the direction I wanted to go. Admittedly, when the situation doesn’t match the Plan, one must pivot.
Additionally, when we ‘started from scratch,’ we were on a shoe-string budget. After seeing a lot of big company failures, it is apparent that some of those failures were because they had ‘easy money’. Shoe string budgets require focus.
b. Knowing your customer. Through trial and error, plus our experience with America’s Best Cleaners, we realized we ‘love’ fussy customers. It turns out that a fussy customer can be a middle-manager in a small firm or the CEO of a National Brand. Both demand high quality, so - serve your customer.
c. Without a doubt – perseverance. I believed we could be successful, and failure wasn’t a choice. My spouse and I put everything into the business. We relied heavily on each other strengths (which were opposite to each other) to navigate the difficulties and we made key decisions along the way to ’course correct’ to facilitate success.
d. Investing in my Staff and my Company
We always look for a better way to do something and create an environment that makes it ‘easy’ for your employee to achieve your desired results. We never require anything from our employees that we would not do ourselves.
We don’t hold back on investing the capital necessary to make our employees’ ‘work home’ as comfortable, clean, and safe as possible.
We like to go overboard to show appreciation to your employees.
How do you approach decision-making in your business endeavors, particularly when faced with uncertainty or risk?
Here are two contradictory strategies I employ:
When it’s not a game-changing decision, I investigate what is already being done and is already successful so we do not reinvent the wheel. For example: it makes sense to spend the money to maintain your equipment; if you see three dry cleaners in a row, go out of business at a location, don’t go there. DON’T WASTE TIME, IT’S PROBABLY A SMALL UPSIDE.
When it’s a game-changer, I LISTEN TO MY GUT. If you’re proud of your work, raise your prices; if you’re proud of your business, invest in a nice website. When I was new to the industry, I didn’t have this insight. However, I firmly believe, your gut will never lead you astray.
How do you maintain a healthy work-life balance while pursuing your business goals for Z Cleaners, and what strategies do you employ to prevent burnout?
I’m not the best at this. I work till I’m tired and I carefully consider when making plans for the future. I put energy into maintaining my business by making sure my business is healthy (top-notch facilities and equipment), my staff is happy (well-paid and great work environment) and my customers are well served (always available to them and we happily provide their customized requests). My growth strategies are to grow a few lucrative sectors of our business only with high margin and low overhead.
Burnout? What’s that? My wife and I both take-off one day per week, on separate days and our great staff supports us being away, they protect our ‘off’ time.
How did Z Cleaners get its name?
When I first started in October 1994, I wanted to have a great name for my first business, so I went overboard. My first company’s name was l-o-n-g: “Arizona Custom Drycleaner and Wardrobe Services, Inc.” Crazy!
After being in business for 3 years, it dawned on me, not one of my new customers knows the name of their previous cleaners. That was a revelation! Additionally, I noticed that in my market, the only word on a strip mall’s monument signage for a dry cleaner was “Cleaner”, I thought, how can I capitalize on the habit that no one knows their dry cleaner’s name and how can I fit my name on the strip mall’s monument signage? What would stand out?
I saw a restaurant here in Phoenix named: “Z Tejas”, with a red “Z”. I was sold, it made sense to me: the “Z” in AriZona. This was one of my gut decisions (I got push back from family). I knew I was right because as the years unfolded, many customers would call the store to ask when their items would be ready or discuss something else. I could hear them speak with their spouse and ask something like: “Hey hon – did you send my suit to Z ?” They knew our name!
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