Alicia Acuna reports on the causes of the shortage, how banks and businesses are responding.
The coin shortage is changing the laundry industry.
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Mom and pop laundromat owners are considering pivoting payment systems from cash-only to credit card-loaded machines as a result of the coronavirus-fueled coin shortage following nationwide business shutdowns. But cash is still king for many customers who may not have access to credit cards or smartphone-linked apps.
Mom and pop laundromats consider new payment methods amid coin shortage. (iStock).
Tampa, Florida-based Michelle Akers, whose family has been in the laundry business for more than two decades, said her customers primarily pay for wash loads in quarters, but with limited access to coins she’s been making daily bank runs to max out on the $200 limit.
CORONAVIRUS COIN SHORTAGE HAS PEOPLE CASHING IN ON SPARE CHANGE
“It’s been a fiasco trying to keep the machines running. It’s a challenge, we’ve been so restricted,” Akers, who runs Florida Laundry Express, told FOX Business on Monday.
Two out of Akers' three laundry businesses have machines that let customers load money onto a card, but she says 75 percent of the business is cash and coin. Her family is considering a redesign incorporating more app-based laundry card machines, which could cost upward of $100,000, a move she’s unsure her clientele will even be receptive to.
“We’re pivoting there. Before [the pandemic] we wanted to do all coins. We started up mom and pop and now we have three locations so we see the necessary need to accept both with the coin shortage,” Akers said, adding that noncustomers have been coming into shops just to use the coin machines.
Akers is one of the thousands of business owners grappling with new laundry payment methods as a result of the national coin shortage.
“It’s been a fiasco trying to keep the machines running,"
Only 20 percent of laundromats give customers the option to load up laundry cards with cash or credit, while 27 percent take credit cards, Brian Wallace, president and CEO of the Coin Laundry Association, which oversees 2,000 laundromats nationwide, told Bloomberg.
What’s more, 49 percent of transactions under $10 are made in cash, according to a study from the Federal Reserve Bank of San Francisco as reported by Bloomberg, a signal that many Americans are still relying on cash and coin as a preferred payment method.
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The humble laundromat joins a number of national retailers also pinched for pennies. Kroger, the country’s largest supermarket chain, reportedly stopped giving back change to customers earlier this month in response to the shortage. Other retailers, like CVS and Wawa, have asked customers paying with cash to do so with exact change when possible.
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Banks desperate to help small businesses in need of nickles and dimes even started paying customers to bring in coins as an incentive.
Federal Reserve Chairman Jerome Powell last month said banks are facing coin shortages as a result of businesses-related lockdowns, blaming the partial closure of the economy halting the flow of coins.
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The Link LonkAugust 03, 2020 at 08:09PM
https://www.foxbusiness.com/money/coin-shortage-drying-up-laundry-business
How a coin shortage is hurting US laundromats - Fox Business
https://news.google.com/search?q=Laundry&hl=en-US&gl=US&ceid=US:en
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