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Developing laundry business into competitive brand

09-26-2010 12:55 BJT

Today we focus on China's laundry business. Zhang Rongyao, a college teacher in Hubei Province, started his business beside his school on cleansers and detergents in the early 1990's, in hopes of helping his poor friends and relatives find employment.

But in order to make his business competitive, he cooperated with Italian partners to establish a dual-brand.

He also developed a one-plus-four mode to reduce costs.

Now he has more than 800 franchises around the country, with yearly revenues of 300 million yuan. And the boss is planning on listing the company.

Headquarters of the laundry company

We start our story in Beijing's 798 Art Zone, which boasts many galleries, cafes and chic restaurants. It's considered one the city's trendiest spots. But strangely enough it is the headquarters of a laundry company. What is a traditional garment cleaning unit doing in an artsy community?

The steam is recyclable. The laundry industrial park where we are located has two main features. First, all the steam being used is waste vapor. Second, all the wastewater can be reused after being processed by the recycling system.

What's more, all the water used in the industrial park is soft water. You'll find undergarments or socks are not soft or your bed sheets don't feel as comfortable as those of five-star hotels. People often think ordinary washing can be done at home. But in laundries, or at least at laundromats, the effect is different...

Starting business

Zhang Rongyao is the board chairman of Rongchang, and has been running the business for 19 years. Born in a poor peasant family in Jingzhou, Hubei Province, Zhang Rongyao entered the Beijing Institute of Light Industry in 1986 and became the only college student in his family. In 1990 upon graduation, Zhang Rongyao remained at the college, earning the enviable job as a teacher.

In order to help his two brothers from Hubei survive in Beijing, Zhang Rongyao, while teaching at college, operated a leather cleaning service with his brothers with technology developed by the college. The names of the three brothers all contain the character “rong”. Adding a “chang” meaning prosperity, the little store was called Rongchang. To their surprise, business boomed...

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