Some things never change – including the consumer’s need for laundromats. Laundromats remain a key point of the American economic landscape, with about 35,000 laundromats operating in the United States today and generating over $5 billion in annual total revenue. It’s easy to see that laundromats are a smart business move, making them a popular choice for investors and entrepreneurs. But what are some questions to ask when buying a laundromat?
Questions to Ask When Buying a Laundromat
Location, Location, Location
If you’re interested in purchasing a laundromat, you probably already know that location is key. Highly populated urban areas near college campuses or apartment complexes make excellent choices for laundromats. These areas typically have a high concentration of students and renters who need access to laundry facilities. You’ll also want to explore nearby competition. After all, a laundromat in an area within walking distance of other, competitive facilities will have a harder time turning a profit.
How Recently Was the Facility Updated?
Today’s laundromats have advanced far beyond clunky quarter machines and drag lighting. To stay competitive, laundromat owners need to stay abreast of recent laundry technology, as well as amenities like Wi-Fi, entertainment, and credit card payment capabilities. Purchasing a recently renovated laundromat is a good idea, as it will require less upkeep on your end. However, a laundromat in need of some TLC can be an exciting opportunity for a committed investor looking for an extensive and gratifying renovation project.
How Recently Was the Equipment Updated?
A laundromat is nothing without well-functioning equipment. Make sure to do your research on the basics of laundromat equipment, and thoroughly inspect the machines in a facility before making an offer. If you have questions about commercial laundry equipment, you’ll want to read the relevant model manuals or contact the machine’s manufacturer. New laundromat owners can also work with a laundry machine repair service for a professional inspection. If you find that the machines are old or in poor working order, you may need to overhaul the facility’s equipment – which will take considerable time and money.
Is the Storefront Currently Leased or Owned?
As a potential laundromat owner, you obviously need to keep a close eye on your budget and general finances. Start by working with the owner of the property you’re interested in purchasing to get a grasp on your initial investment costs. If you are buying an existing laundromat space, you can expect to spend between $200,000 and $500,000. You’ll also want to ask the facility’s current owner about the building’s lease terms. While laundromats have several monthly expenses to look out for, a laundromat’s storefront lease will undoubtedly be the highest monthly expense you face as a potential buyer. Make sure to do your research to identify a lease term that aligns with industry standards – potentially a longer lease term to align with a more frugal budget.
Buying a laundromat can be a high-return, hands-off investment. However, as with any major investment, it’s crucial to ask questions to ensure you’re making a smart business choice. Focusing on a laundromat’s location, conditions, and lease terms is a great place to start.
Finally, if you need any help updating or maintaining your laundromat after your purchase, check out Laundry Solutions Company, a full-service provider of premium vended, on-premises, and multi-housing commercial laundry equipment. Our leasing program provides no mileage fees, no service fees, and no parts fees. You will be able to use high-quality Speed Queen equipment while enjoying a flexible lease and predictable payments. To learn more about our products and services, please give us a call at 800-838-9274 or contact us online. We look forward to hearing from you!