Dry cleaners have implemented price hikes to maintain profitability amid falling demand.
New York, NY (PRWEB) April 05, 2015
The Dry Cleaners industry provides dry cleaning and laundry services to consumers and businesses, such as hotels and clinics. Over the past decade, shifting consumer trends toward casual clothing have reduced the need for dry cleaning services that are typically only used for formal and office wear. “Moreover, the growing popularity of dry cleaning alternatives and advanced at-home laundering machines have captured an increasing share of industry demand,” according to IBISWorld Industry Analyst Brittany Carter. These long-term trends are expected to decrease revenue at an average annual rate of 0.7% to $2.1 billion over the five years to 2015.
This industry has consistently declined over the past five years, as dry cleaning services are highly discretionary; revenue fell considerably over 2010 as many consumers held off on dry cleaning services due to a decrease in disposable income. Economic recovery, however, has slowed declines in recent years and the growing number of high-income individuals that use industry services has aided demand conditions. Revenue declines have consequently slowed, with revenue decreasing 0.9% over 2015.
Dry cleaners have implemented price hikes over the five years to 2015 to maintain profitability amid falling demand. Based off data sourced from Statistics Canada, the consumer price index for dry cleaning services is expected to increase considerably over the period. “While price increases have aided industry profit margins, dry cleaners are subject to high rent costs to maintain proximity to customers, with many operators struggling to remain profitable,” says Carter Statistics Canada reported that a notable 27.9% of dry cleaners operated at a loss in 2010. Therefore, the number of industry establishments is expected to fall at an average annual rate of 1.6% to 3,223 locations over the period.
While changing consumer patterns will continue to reduce demand for the Dry Cleaners industry, the industry will nonetheless benefit from accelerated income growth. As consumers return to work, industry players will increasingly rely on other services, such as wash-and-fold laundering, to leverage consumers' busy schedules. Eco-friendly dry cleaning services will also grow in popularity as mounting regulation and environmental concern spurs operators to purchase hydrocarbon and water-based solvent cleaning machines.
For more information, visit IBISWorld’s Dry Cleaners in Canada industry report page.
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IBISWorld industry Report Key Topics
This industry provides dry cleaning and laundering services. Companies may also provide drop-off and pick-up sites for laundries and dry cleaners. In addition, establishments may also offer specialty-cleaning services for garments and textiles, including fur, leather, suede, wedding gowns, draperies and pillows. This industry does not include establishments that offer coin-operated laundering and dry cleaning, or those offering linen and uniform rentals.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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