No matter what time of year it is, and even if the economy experiences a downturn, people will always need laundromats. According to the president and CEO of the Coin Laundry Association, the industry is experiencing a facelift of sorts as more coin laundries focus on being extremely comfortable for customers and offering added amenities, like wash-and-fold services, dry-cleaning, snacks, and entertainment. While you may choose to add additional services to your laundromat down the line, today we’re exploring the basic steps to start a laundromat. If you’re interested in joining the industry, this is what you can generally expect from the process.
Steps to Start a Laundromat
Do your research.
Most entrepreneurs who enter the laundry industry don’t have any experience when they’re first starting out. So to start, we recommend that you talk with laundry owners, join related associations, and read industry literature to better understand the business.
You’ll also need to research the costs involved to ensure you’re financially ready. Initial costs may include construction or remodeling, washer hook-up fees, licenses and permits, and equipment (consider leasing your equipment if paying the upfront costs of the machines isn’t feasible). Ongoing expenses include lease/rental costs, utilities, insurance, employee payroll, and miscellaneous supplies. Obviously if you choose to buy an existing laundry, the overall process will be much simpler.
The research and planning period is one of the most involved steps to start a laundromat, but it’s crucial that you take your time to ensure that you enter this new venture with a clear understanding of all the details involved.
Set up your business.
At this stage in the process, we encourage you to hire an accountant to assist with all the legal and financial aspects of running a business. To create a legally compliant and competent company, you will need to perform the following steps:
- Form a legal entity.
- Register for taxes.
- Open a business bank account.
- Set up accounting (to track expenses and income).
- Get business insurance.
At this stage, we also recommend that you create a business plan that defines your goals and includes a market analysis, financial projections, and marketing ideas.
Obtain the space.
Next, you’ll need to obtain the space for your laundromat. Depending on your wishes, this will include (1) buying land and starting the construction process, (2) purchasing a space and starting the remodeling process, or (3) buying an existing laundromat.
Then, obtain the licenses and permits you’ll need to legally operate your business. Check with your municipality to learn what’s required, and note that you may need to file/pay all of the following:
- Business license
- Fire department permit
- Air and water pollution control permit
- Sign permit
- Public improvement fees
- Impact fees
- Sewer connection fees
- Sewer and wastewater fees
Be sure to tackle these issues early in the process so that you aren’t facing legal trouble further down the road.
Buy the equipment and hire employees.
If you haven’t purchased an existing laundromat, you’ll need to buy all the washers and dryers for your business as well as a water heating system. If you wish to add a card system, this will be an additional expense. Other items you may need include soap, a soap vending machine, laundry carts, cleaning equipment, signs, chairs, trash cans, and security cameras.
At this stage, if you’re not running your laundromat solo, you will need to hire employees for your laundromat. Work with your accountant to ensure you follow all of the legal requirements involved, including getting an employer ID number, withholding income and payroll taxes, getting workers’ compensation insurance, and creating a payroll process.
Of course you could go much further than this – adding in snack machines, a play area for children, a TV, etc. – but these basic steps for starting a laundromat should get you started.
Finally, be sure to 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!