If you want to own your own business, a laundromat can be an intriguing option. After all, it’s a recession-proof choice that can bring a steady income with relatively little day-to-day demands. It also allows you the freedom to put your own personal stamp on your business since the kind of conformity that franchises tend to require is rarely an issue. Whether you’re a fledgling entrepreneur looking for your first commercial success or a veteran businessperson ready to add to your empire, you will want to keep these tips for buying a laundromat in mind.
Tips for Buying a Laundromat
Any potential investment should be approached with proper care, so it’s no surprise that doing your due diligence is an absolute must when you’re buying a laundromat. Following these seven practical tips for buying a laundromat can help you cover your bases.
1. Understand the Business Model
A business owner is expected to handle everything. Management of the staff, maintenance of the equipment and the facility, marketing, and financial management will all fall under your oversight, so you’ll need to have at least a basic understanding of them. You will also want to have a clear picture of the business model for a successful laundromat so that you can accurately evaluate the strengths and weaknesses of potential purchases as you search for the right laundromat to buy.
2. Recognize That Location Matters
Customers want safety and convenience, so physical location can play a gigantic role in a laundromat’s success or failure. As long as the established competition in the surrounding area isn’t daunting, laundromats near college campuses, apartment complexes, and major retail hubs have a fantastic chance to build a loyal customer base. In addition to selecting a place with a built-in market, consider the particulars of the facility. Is the building in good condition? Is it in a safe area? Are the terms of the lease for the storefront favorable?
3. Evaluate the Equipment
When buying an existing laundromat, the equipment is a major factor in its value. Is the equipment regularly maintained and in good shape? How well does it match the needs of the customers? How much effective life does it have left? What condition are the water pipes in? Is the electrical system up to code? Replacing inadequate machines and fixtures can get expensive quickly, so you need to know what you’re dealing with before moving forward with any purchase.
4. Know the Cost of Doing Business
While you’ll definitely want to verify the reported income of any laundromat that you’re considering, you should also investigate any regular or projected expenses. This list should include payroll, repairs and maintenance, worker’s compensation, taxes, office and cleaning supplies, and security system fees.
5. Manage Your Capital Wisely
It’s an established fact: Getting a business running smoothly often requires a considerable investment of time and money. When purchasing a laundromat, mind your budget. Don’t make the mistake of allowing a laundromat’s price tag to eat up all of your resources. Be sure to maintain a responsible cash reserve so that you aren’t forced to close your doors due to a lack of business capital.
6. Take Time Seriously
Business owners who hope to keep expenses low often try reducing payroll and maintenance costs by doing the jobs themselves. If you’re planning to incorporate this into your strategy, ask yourself if this is really the best use of your time. Before purchasing a laundromat, take a serious look at how much time you’re willing to invest in the business. Then, think carefully about how those hours are best invested and plan accordingly.
7. Consider the Long View
Before purchasing a laundromat, consider the long view and have a plan in place. While people will always need to do laundry, stagnation and obsolescence can turn customers away. Upgrades and retooling are an inevitable part of keeping a business successful, so think about what investments will likely be required in the future and the impact that they’ll have on your bottom line.
Are you planning to buy a laundromat? For a reliable distributor, 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 800-383-9274 or contact us online. We look forward to hearing from you!