Low worker engagement, low retention and high worker churn cost the on-demand economy thousands in recruitment and even more in lost revenue. Especially for those scaling rapidly, speed of recruitment and the sustainability of their flexible workforce is critical for growth.
Enter Laundryheap - the UK’s largest on-demand laundry and dry cleaning service, with rapid expansion plans from California to Singapore.
By partnering with Collective Benefits to provide their self-employed partner drivers with a range of targeted protections, they saw clear benefits after just 3 months.
The challenge of churn and engagement
Like so many in the on-demand economy, Laundryheap faced the difficult challenge of creating and maintaining a sustainable workforce;
- Difficulty recruiting: For every 75 applicants, the platform onboarded only one new independent worker
- High churn: Despite their large pool of applicants, only half of drivers stayed for over 3 weeks.
- Increased onboarding costs: Laundryheap spent $4,600 last month onboarding 44 people, only half of whom are still on the platform in just a few weeks, more than doubling the costs of a successfully onboarded applicant.
- Supply instability: Laundryheap have seen same-day slot cancellations increase by 200% on days with bad weather, whilst 1/15 same day slot cancellations are due to poor cash flow and the inability to afford fuel.
- Unmet demand: Despite having 15 times the number of drivers they should statistically need, 5% of their slots still remained open each day.
Recognising these industry-wide issues, Laundryheap is challenging the status quo in providing an industry-leading worker experience.
The solution: partnering with Collective
Uniquely vulnerable to the Covid-19 pandemic and the economic fallout of the crisis, independent workers are concerned about their financial and physical health now more than ever. Companies serious about improving their worker engagement must put a safety net in place. Laundryheap is leading the way by doing this through their partnership with Collective, rewarding their most engaged workers benefits like sick pay, family leave, and mental health support.
The results: a healthier outcome for all
Laundryheap’s investment in their partner drivers has paid off, making a real difference to their lives and mental wellbeing.
“Covid has been very hard. It showed how vulnerable you are to your situation so it is nice to have something to fall back on.” - Laundryheap driver
“After the baby [had come], I applied to [Collective], and they explained everything to me. They told me how I could claim, how I [had to] submit my form, it was very easy. There were no issues or any problems. £500 [in paternity support has] helped me. I took two weeks off, we’ve just bought a chair and little things for the baby.” - Laundryheap driver
And in turn, this has made a real difference to Laundryheap's ability to recruit and retain workers:
- Two fifths of drivers are still working with Laundryheap, even if only one shift per week, specifically in order to achieve a higher tier of protections.
- Although Laundryheap offers a lower wage compared with larger players like Amazon, 33% of Laundryheap drivers stay with the platform due to the benefits they provide.
“I truly love the concept of Collective Benefits. I’ve built my career around the gig economy, and Collective will go a long way to ensure that self-employed are more protected. I’m very excited about that.” - Quaid C. (Logistics Team Lead at Laundryheap)
The final result?
17x ROI in lowered recruiting and onboarding costs.
Here at Collective, we are serious about enabling companies with the right intentions to provide the right protections. If you are interested in combatting churn, boosting worker loyalty and retaining your best on-demand talent - all while protecting your workers - please get in touch with us to learn more about how we can help you.
Together, we can ensure independent work benefits everybody.
Find out more about Laundryheap here.