To date, the fully-owned laundromat brand WeClean has over 65 branches in Metro Manila and more branches set to open provincially and across Asia.

With the economy recovering from the aftermath of the pandemic, the National Economic and Development Authority (NEDA) reported that the labor force in the Philippines has grown to 66.6% in February 2023—an increase from the recorded 63.8% during the same period last 2022. This means that there’s an increase of 2.7 million Filipinos joining the labor force on a year-on-year basis.

Given the growing labor force in the Philippines, the demand for commercial services like laundry businesses has gone up. After all, with a significant part of the population working and many companies returning to an onsite or hybrid office setup, some people find it hard to balance work and chores, including doing their own laundry.

This is why laundry shops are in demand. Aside from offering convenience, it also accommodates a diverse market—young professionals who live alone, working parents who juggle household chores, childcare duties, and a job, as well as business owners who are busy running their respective companies. In fact, numbers from Statista show an upward trend in laundry services in the Philippines with forecasted revenue to reach approximately US$88.2 million (around PHP 4.94 billion) by 2024.

Moreover, the marketing research and consulting company Grand View Research reports that the market for global dry cleaning and laundry services is expected to expand at a compound annual growth rate (CAGR) of 3.4% from 2020 to 2027—which is valued at US$79.91 billion (around PHP 4.46 trillion) by the end of the forecasted period.

With a positive trend toward laundry businesses, many business owners have ventured into this industry. Many self-service laundry shops have opened, as well as laundromats. Take for example WeClean—an up-and-coming laundromat that started just last 2017.

To date, it has over 65 branches in Metro Manila alone. But the more noteworthy aspect of this shop? All branches are wholly-owned and managed by a four-man team of entrepreneurs: Alfonso Bigeriego, the founder and CEO; Eduardo Ros, the finance and strategy head; Alejandro Gonzales of operations; and Jorge Garcia, who handles marketing and partnerships.

This is their story.

What’s the story behind WeClean? What inspired you to venture into the laundry or cleaning industry?

Alfonso: The story behind WeClean began when I first visited the Philippines as a tourist. I was immediately drawn to the country and knew that it was the perfect place to develop a business venture.

In 2017, I made the decision to enter the construction industry, and as part of that, I developed a building in Pasay City. There was one commercial space in the building, and I saw an opportunity to establish a laundromat, as it appeared relatively easy to operate.

While operating the business, I began to realize the huge untapped potential in the industry, which motivated me to take the business to the next level and scale it up under the name of WeClean. 

Today, WeClean operates 65 fully-owned branches in Metro Manila, is opening in the provinces, and is planning to expand internationally. We are just getting started and these numbers reflect the enormous opportunity existing in the space. We are excited to continue our journey and are committed to providing our customers with the best laundry and cleaning service possible.

What inspired you to branch out and make your own business instead of working in corporate?

Alfonso: I have always had a passion for entrepreneurship and the drive to create something of my own. Throughout my career, I have consistently pursued my own projects and initiatives, and it was only natural for me to continue doing so by starting my own business.

The corporate environment simply does not align with my entrepreneurial spirit and drive for innovation and growth. I believe that by starting my own business, I am able to fully unleash my potential and make a meaningful impact in my industry.

Securing capital is often a challenge for businesses, especially when starting out. What are some avenues that you explored?

Eduardo: The journey of securing funding for our company has been a challenging one, particularly in the context of the ongoing global pandemic. Initially, we turned to personal connections—raising equity from friends and family members.

As our network expanded, we were able to secure additional funding from local angel investors and smaller institutional investors. Currently, we have a diverse pool of funding sources, including private investors and bank loans. While we are grateful for the support we have received, the process of working with banks has proven to be particularly challenging, as their requirements and regulations are not always well-suited to the needs of a startup company. 

How much capital did you start out with and how much more or less are you earning now? What was that moment that contributed to a large growth in sales?

Alfonso: When we first started WeClean, we began with a relatively small amount of capital, with less than $100,000 [around less than PHP 5.58 million]. However, through strategic investments and effective management, we have been able to achieve significant growth. Our current annual recurring revenue (ARR) is now close to $4 million [around PHP 223.27 million].

One of the key moments that contributed to this growth was during the pandemic when we were able to purchase high-quality assets at discounted prices. This enabled us to grow inorganically and expand our portfolio by adding 35 new branches.

This represented a significant increase in sales and allowed us to continue our growth trajectory despite the challenging macroeconomic conditions. Our ability to seize opportunities and make strategic investments has been instrumental in our success and has allowed us to achieve this level of growth in such a short period of time.

What are some of the growing pains or challenges that you faced while starting out? How were you able to adapt, overcome or pivot from those?

Alejandro: One of the significant challenges we have faced is the development of a cohesive and effective team, as well as the cultivation of a strong corporate culture. As our company’s founders originate from a different country, this has had an impact on various aspects of our daily operations. We have had to adapt to cultural differences, such as variations in punctuality and work ethic.

Additionally, as we continue to expand our presence through the opening of new branches, the recruitment process has become increasingly complex and time-consuming. Training new employees and ensuring that they understand and align with our company’s mission and vision is a crucial but challenging task. It requires a lot of effort and dedication to build a team that is committed to our company’s values and goals.

What business models or practices did you implement that worked and didn’t work?

Eduardo and Alejandro: As we are still in the process of testing and learning, it is challenging to provide a comprehensive answer to this question. However, we have seen positive results from implementing a variety of practices. Specifically, we have found that cross-selling with other revenue streams, such as alterations or water stations, has been beneficial in driving growth. The implementation of pick-up and delivery services for dry cleaning items has been operationally challenging, but it has proven to be a successful strategy for increasing customer satisfaction.

On the other hand, we have found that certain marketing and awareness campaigns have not been as effective as we had hoped. However, these experiences have helped us to better understand our customers and their needs, allowing us to adjust our strategies accordingly.

We strongly believe that delivering an exceptional customer experience is the most effective and sustainable way to gain market share. As such, we have made significant efforts to shorten the turnaround time for processing and releasing customer items, in some branches, we have reduced the release time by more than 50%.

Although we have not yet achieved success with affiliation and referral campaigns, it is an area that we are continuously seeking to improve. We are learning that there can be a significant difference between what we perceive as a successful marketing campaign and what our customers are looking for based on their background or current needs.

What were some problem areas that you noticed when running WeClean?

Alejandro: One of the key challenges we sought to address with our company is the issue of seasonality in our industry. This requires careful forecasting and planning in order to ensure that we have the necessary resources, including equipment and staff, to meet the varying demand throughout the year.

Another significant challenge is finding the most efficient ways to invest in [capital expenditures] CAPEX. In order to provide the best service at the lowest possible cost, it is essential to balance the need to maintain and upgrade equipment with the need to minimize operating expenses.

Additionally, staying current on the latest industry news and technologies is crucial to ensure that we are able to provide our customers with the most efficient and high-quality service possible.

What is your competitive advantage over other laundromats here in the Philippines? What’s your strategy or business model that helps you stand out?

Eduardo: WeClean has a unique competitive advantage over other laundromats in the Philippines, as we are not simply a traditional laundromat provider. Instead, we have developed a revolutionary concept of a community center that offers a wide range of services related to laundry, with a strong focus on providing exceptional customer service.

By providing additional services and benefits, such as free data while customers wait for their laundry, we aim to create a win-win business model for both ourselves and our customers. This approach sets us apart from our competitors and is a key aspect of our strategy for achieving success in the marketplace.

On top of that, WeClean stands out from the competition with our fully-owned network of 65 branches. Unlike similar-sized competitors who rely on a franchise model to expand quickly, we prioritize quality, customer satisfaction, and profitability.

This sets us apart in the market and gives us a competitive edge. We are fully committed to this approach, and our goal is to become the leading laundromat provider in the Southeast Asia region with this model.

In building WeClean, you have had your share of successes and failures. Can you share some examples? What lesson did you learn from them?

Jorge: In building our brand, we have certainly experienced both successes and failures. One area where we have encountered challenges is in our efforts to connect with the younger generation.

We have learned that it is critical to understand the values and interests of this demographic, as well as to communicate with them through their preferred channels. In order to overcome these challenges, we have recognized the importance of adopting a more segmented approach to marketing—[by] focusing on specific demographics and tailoring our campaigns accordingly.

As a result, we have developed a strategic playbook for 2023 that includes a strong focus on short-format videos, in-person events, and community-building via influencer marketing. We believe that this will help us to better engage with the younger generation and drive revenue for our brand.

Additionally, we have also learned that it is important to be flexible and adaptable in our approach, as the market and consumer preferences are constantly evolving.

From your perspective, what are the emerging opportunities in the Philippines, especially in the new normal?

Eduardo and Alejandro: From our perspective, there are several emerging opportunities in the Philippines—particularly in light of the ongoing new normal.

One of the most significant opportunities for WeClean has been the resumption of classes and operations in schools and universities. This has allowed us to maintain steady business and continue to employ our staff despite the difficulties faced by the laundry industry as a whole.

We are proud to have been able to adapt to the changing landscape and are confident that we can continue to improve the customer experience through the implementation of new technologies and practices. We have already adopted digital payments, reduced our average delivery time, and are currently testing a proprietary system that will enable us to better serve our local communities.

Another area of opportunity for our company is the expected rebound of tourism. There are many islands in the Philippines that have yet to be fully developed and professionalized, and we believe that as tourism returns, these areas have the potential to become major markets for our company. Overall, we remain optimistic about the potential for growth and expansion in the Philippines despite the ongoing challenges.

Jorge: From a marketing standpoint, we see significant potential for reaching wider audiences and serving evolving consumer needs. The recent lockdown period has led to new habits and preferences for interacting with businesses, and our pickup and delivery services have seen a surge in demand as a result.

The trend toward convenience-driven services that save people both time and money has been on the rise, and we are well-positioned to capitalize on this trend. We are closely monitoring this development and are fully committed to delivering an exceptional service that exceeds our customers’ expectations.

What concrete advice can you give aspiring entrepreneurs who want to start their own businesses?

Alfonso: Always keep learning—whether it’s learning about new technologies, new ways of doing business, or new marketing strategies. Stay current and be open to change, it will help you adapt and grow.

Starting a business takes a lot of hard work and dedication. Believe in yourself and your idea, and don’t be afraid to take risks. Stay motivated and don’t give up, even when things get tough.