‘They’re Not Dressing Up.’ Dry Cleaners Are Pressed By Ongoing Remote Work Trends
The onset of the coronavirus pandemic prompted the U.S. at large to shelter in place. Events were canceled and offices shifted to remote work, leaving few reasons to dress up.
That was bad news for dry cleaners.
In 2020, those retailers saw their business drop as much as 80%, Dry Cleaning and Laundry Institute CEO Mary Scalco told Bisnow.
“It was huge,” Scalco said.
Two years later, as events have returned and the U.S. workforce trickles back into the office, Scalco says most dry cleaners in her 6,000-member national group are within 20% of their 2019 business levels, with many adopting new business practices, like delivery options, to lure back customers.
As these businesses get back on pre-pandemic footing, there is a clear factor for those struggling the most: location.
“People are not going to work — they’re not dressing up,” said Don Kohan, the owner of Cleaners Depot in Los Angeles. He operates two locations: one in a Century City office building and another in the core of Downtown Los Angeles.
Both are heavily dependent on the daily flow of workers into the area, he said, and thus have taken big hits from ongoing work-from-home trends.
“Everybody is in front of a computer in a T-shirt and a pair of shorts. Nobody wears suits and ties and shirts.”
An IBIS World industry report estimated that the dry cleaning industry generated $9.2B in revenue across 32,380 businesses as of February 2020, according to CBS News. By October 2021, the industry had lost $1.2B and almost 1,000 businesses, an updated report said.
Like many other sectors, the pandemic only accelerated the decline in the dry cleaning industry, which has been facing headwinds for two decades. The industry, for example, has been experiencing a drop-off in business from work-related clothing since before the pandemic, according to Dawn Hargrove-Avery, director of communications at the National Cleaners Association.
“People don't dress up like they used to to go to work,” Hargrove-Avery said. “Things have become much more casual.”
Hargrove-Avery estimates that 1 in 6 dry cleaners has either filed for bankruptcy or closed their doors since the onset of the pandemic, and the impacts are far from over.
Scalco told NPR in March 2021 that her group estimated that by the time the pandemic was in the rearview mirror — a mile marker she estimated was at least a year away — the industry will have shrunk by a third.
Though many might be quick to think of suits and sport coats when it comes to dry cleaning, the industry relies heavily on people doing more than just going to work, Hargrove-Avery said. This was echoed by several dry cleaners who spoke to Bisnow and said a bulk of business stems from high-quality goods and dress wear, i.e., clothes for formal dinners and events, namely weddings.
“When weddings stopped, it was a hit,” Hargrove-Avery said.
Still, the loss of office wear took a toll on the industry, with many waiting for return-to-office trends to materialize.
While they waited, they adapted, Scalco said, with dry cleaners adding pickup and delivery services if they weren’t already offering them, or leaning into time-honored services like fluff-and-fold.
Getting people back to the office en masse will be an important part of helping dry cleaners continue to rebound, both association representatives agreed. But as the pandemic has dragged on with no clear ending in sight, Scalco doubts dry cleaners are holding their breath.
“I doubt many people are still waiting,” Scalco said. “If they are, that might not be the best position to be in.”
Location has played a significant role in the severity of pandemic effects for dry cleaners.
“If you're in a downtown where the businesses aren't back 100%, you're suffering more than, say, your rural dry cleaner, because they weren't dependent upon people coming into the office,” Scalco said.
Jordan Wood owns Davis Imperial Cleaners, a Chicago-area business started by his grandparents over 50 years ago. Neither the Evanston nor Chicago locations of his cleaners are in a dense downtown area, and work clothes were never a large part of their business.
“Our model is not as affected by the guy who's going to the office and utilizing the dry cleaner that's in the building or next to the building they work in,” Wood said. “The people in our industry who relied on that back to office got hit so hard.”
Kohan's Downtown LA Cleaners Depot location is now operating at about 45% to 50% of pre-pandemic levels. His Century City location is only at about 10% to 15% of pre-pandemic business.
He doesn’t expect his business will ever be what it was before the pandemic, as he expects remote or hybrid work trends to continue. He's hopeful, however, that he will recover to the point where he’s doing 80% of pre-pandemic business.
As for when that milestone could be achieved, Kohan's not sure.
He thought that maybe it had come in November, when people started to return to work.
"November was a good month. A lot of people came back. My business jumped 15%," Kohan said. "Then, all of a sudden, we got the new omicron [variant]. And a lot of the buildings and offices shut down again."