Is Buying A Laundromat Worth It?
Getting into the laundromat industry can be an excellent investment. It offers flexibility with plenty of work all year round. However, small business ownership involves risk, hard work and dedication.
When deciding whether to invest in a laundromat, you must account for critical factors such as location and management. Use this guide to learn how to start a laundromat business and create a detailed plan for success.
Choosing Your Target Demographics And Laundromat Location
It’s essential to choose the best location when investing in a laundromat. Urban areas and main streets are a great fit. Centrally located businesses stand out, attracting more passersby. Ensure the building offers ample free parking or is close to public transportation. You should also consider buying a laundromat near places such as these.
- Multi-unit complexes: Not all apartments or condos have communal laundry rooms or space for in-unit washers and dryers. You can serve many families by offering laundromat services in their community. Multi-family apartment buildings and housing communities where families earn a lower to middle-class wage are the ideal spot.
- Universities and colleges: Between attending classes and enjoying campus life, students prefer the convenience and efficiency local laundromats offer.
- Hotels and guesthouses: Thick blankets and duvets, sheets, towels and bathrobes are some of the few items hotels and guesthouses must wash daily. With a local laundromat, these businesses can quickly handle these responsibilities.
- Shopping centers: As customers run errands, a laundromat close to shopping centers and supermarkets will help them complete their to-do list in a single day.
Your online brand presence is as crucial as selecting an ideal location. Many customers search Google to find laundromats near them. Focus on creating a positive online presence. You can set up a Google Business Profile to ensure people find your laundromat before heading to competitors. You can also add photos, business hours, location and reviews to appeal to new customers.
Cost To Buy A Laundromat And Common Operating Costs
There are many considerations before buying a laundromat, including fluctuating operating costs. Setting up a flexible budget will help you plan for unforeseen additional expenses. Here is a breakdown of what your operating costs can include each month.
- Monthly fixed operating costs: After buying your laundromat, you will have recurring monthly expenses like rent, loan payments, monthly service fees and trash removal
- Monthly fluctuating cost: While running your laundromat you will have varying costs each month for utilities, payroll and capital improvements.
- Utility bills: Your utilities will represent a significant portion of your expenses. You must pay for the water, sewage, gas and electricity required to run so many washers and dryers. Don’t forget additional expenses such as cleaning supplies and detergent. If you have older, less energy efficient machines you might consider upgrading to new machines that are more economical to operate. Your distributor can help you assess the cost savings.
- Real estate expenses: These include your rent and property taxes. Your location can impact the rent you pay, as popular spots tend to cost more per month. If you buy an existing laundromat, check whether the previous owner owns or leases the building. If you are not buying the real estate, the length of the existing lease and renewal terms are extremely important. You mut have ample time on the lease for your investment to make sense.
- Repairs and maintenance: If you buy an existing laundromat with older washers and dryers, you will need to make repairs more frequently, so you need to figure that in your operating budget.
- Payroll: Your employee payroll depends on the type of laundromat you want to own and its location. Most laundromats do not have large staffs. You can pay your valuable team members more by keeping operations lean.
- Marketing: Marketing will attract new customers to your business. You may want to hire someone to manage your website and social media platforms or set up ad campaigns to connect with people and promote your laundromat.
Management
Laundromat management differs from business to business. With minimal employees and customers doing all their laundry, you can choose your work hours at a time that suits your schedule. Thanks to a laundromat’s self-service nature, you can manage your business with regular check-in visits to ensure everything’s running smoothly. If you are doing wash-dry-fold then you will need somebody to manage that portion of the business.
New technology has made it easier for customers to pay and laundromat owners to manage their finances off-site. Digital card payment systems such as SpyderWash let you keep track of financial activity using an online system.
Equipment
It’s vital to inspect your equipment when buying an existing laundromat. Even older machines and models can help you in your first few years in business. To ensure the equipment is in top condition, look out for any issues such as:
- Visible damage to any of the machines
- Out-of-order signs
- Leaks
- Failure to drain
- Electrical issues
When building a new laundromat your local distributor can help you with layout and purchasing all the equipment that will be needed in your new business, such as:
- Washers
- Dryers
- Impact fees
- Construction costs
- Security systems
- Digital card payment system
- Change or card machines
- Laundry soap or detergent vending machine
- Laundry carts
- Folding tables
- Chairs
- Cleaning supplies
Competition
What to know before buying a laundromat is that it is a competitive industry. You will be going up against rival laundromats in your area and the shared laundry rooms in multi-housing complexes.
Research the area before settling in a location. You need to determine if other laundromats are in the area and how close they are to you. An established business might have a steadfast customer base that won’t quickly switch to your services.
Speak to the previous owner to identify your target market within the area. When competing with other businesses, you can use targeted marketing strategies to turn first-time clients into loyal customers. With SpyderWash loyalty programs, such as our free wash program, we can help in pulling in new customers form other laundromats in the area.
Count on the SpyderWash Payment System
Start your new business with the innovative SpyderWash digital card payment system. With our tips for buying a laundromat and contactless payment options, you will be ready to take the next step in your new venture and provide your customers with reliable and convenient services. Find out more about digital card payment processing by completing an online contact form, and we’ll get in touch with you shortly.
