WhitePlus is a Japanese startup that offers an online laundry service called Lenet. It lets users request a pick up of their laundry, which will then be cleaned and delivered to their home. Recently, on December 2nd, membership for this laundry service surpassed 40,000 people. That total is three times bigger than a year ago.
The latest upgrade of the service took place on September 30th, with the price reduced, and the minimum delivery time being cut to 2 days.
The company raised funds in August of 2013, and since then they have been growing their business. For such a paid service, one of the indicators we should look is the rate of repeat customers, a sign user satisfaction.
Ryosuke Saito, the company’s CEO and CMO, told us a little about that.
The Bridge: It seems sales has been growing well for you. Do you have any indicators that show how much?
Saito: We cannot disclose detailed figures, but as an example, the CVR of new users is increasing since our renewal at the end of September. To increase our repeat user rate, we changed the price as well. Since we implemented our membership fee (premium membership costs 315 yen, or about$3 per month), we have reduced the discount rate for members from 20% to 35%, with intention of making the price lower than regular offline laundry services. Also, by making a delivery time of two days, we hoped to increase user satisfaction.
Lenet doesn’t own a cleaning facilities. It uses those of partners. And by reviewing the process from inspection to packaging, the overall process is made even more efficient. As a result, they could shorten the delivery time. But to do all this, they have also hired industry professionals who have much experience.
The Bridge: The business model is to use available resources without having to own your own cleaning facilities. But can you easily scale this business without owning such facilities?
Saito: Our next challenge it to increase our capacity. And yes, that means we need to find facilities. Now we are planning to establish a facility with a business partner. From there we can expand out from that, sort of as the center of other facilities to come later.
For the business model of this type of business, one advantage was that it didn’t require too many resources. That’s why Linet utilized partners, tying up with five different facilities.
However, as he told me in a previous interview, the industry is quite closed. I heard some stories about how the business can be quite hard on young new-comers. And perhaps that’s why they need to establish their own facilities.
Partner factories have the advantage of receiving more orders through the tie-up. According to Saito, he wanted to make his factory into a center where they can check and ensure operations are streamlined.
This attempt by Linet to bring a traditionally offline service online is definitely worth watching. So stay tuned to see how they do!