Wednesday, October 21, 2009

Finding a Laundromat for Sale

The Coin Operated Laundry Business

A laundromat is like any other small business, it has a location, staff, expenses, employees, etc. What makes them a good business to get into is that they have been around for a fairly long time, 50 to 60 years or more in some areas. Coin Operated Laundry services have always been good businesses to get into back then and even today.

Everyone, including yourself, have dirty clothes... that's millions and millions of potential customers. Your not going to get them all, but you will get some of them. The base operating of a laundromat is self service for the customer, so they are actually doing the work, you are simply supplying a location and equipment. You may already decided this and are looking for ways to find that business, either locally or in another area.

Finding a laundromat for sale

To find a commercial business, you'll need to be looking in the right place. Browsing your local newspapers will usually not provide much, you might get lucky and actually find a great local laundromat to buy, but the odds are low. What you will need to do is find a commercial Realtor or commercial business listing. Some that you can look at online include and/or . Both have great listings on available businesses for sale.

Buying a Laundromat

As I have said before, there is a lot that you need to consider when buying a laundromat. Everything from the location, equipment, laundry supplies, commercial laundry machine servicing, the building itself, leasing options, legal issues, customer demographics, earning potential and especially the reasons as to why an existing laundromat is for sale in the first place.

If you are looking at buying an existing coin operated laundromat business, you need to know why it is for sale. If the current owner is retiring, illness, or something that would prevent them from continuing in the business, then it would be a good location to consider. However, if you cannot determine the exact reason, then it is likely that the owner is not earning enough, or is loosing money. This could be because of the location, equipment failures, pour service or something that is keeping the potential customers away.

Not only should you look at existing laundromats for sale, but you should look at some that are not for sale. See if you can get in touch with other owners, preferably on the other side of town. If you related to another business owner and you show that you don't have any competition with them, they will be more likely to help you out. Most small business owners that thrive are proud of their achievement and I have found that they often like to talk about it. Be straight with them, tell them you want to get into the business and that you are curious as to why they have done so well. Complements do work wonders, even if the place is a dive.

Tuesday, May 5, 2009

Buying Commercial Laundry Equipment and Machines

With every coin operated laundromat you will always need to buy or lease commercial laundry equipment. The machines that you buy will need to be capable of handling the volume of laundry washes and dries for your business. I would also recommend that you acquire equipment that can handle a little more then your regular traffic. Having spikes in volume at various times of the year is when your equipment is put through heavier loads, and for longer periods of time. Having the right laundromat equipment will help keep them all working when you need them and minimize repair costs and down time.

Commercial Laundry Machines

In the laundromat business, there has been a large focus in recent years to use more energy efficient machines. Many laundromats have switched to higher efficiency equipment many, many years ago. In the past, the standard was to have high volume and high performance laundry equipment in laundromats, sacrificing the efficiency in order to provide more powerful machines. This provided the customer with the ability to wash bigger loads and get out stains that their regular laundry machines at home could not do, thus attracting more customers. Many of the manufacturers of commercial laundry equipment have been doing it for many decades, as an example, Queen has been building washers and dryers for over 100 years. That kind of history and longevity is something you should look for in deciding on the brand of commercial equipment you want to use. There are a lot of manufacturers on the market, all ready and willing to sell you their machines. Look for warranty service, local warranty authorized dealers, on-site service, warranty length. Also, many of the commercial laundry machine manufacturers will work with you to setup all your machines on-site, as well as install and setup all the coin/card readers for the machines.

Commercial Laundry Machine Distributors

The distributor, or manufacturer of the machines must be a consideration in your laundromat business. You will need to research and chose wisely. The majority of the distributors of commercial laundry equipment are committed to seeing each and every coin operated business succeed and will always work with the owners and operators to optimize their business and profit goals. There are of course, the distributors that are just trying to make a buck and will sell you anything, as long as they think you'll buy it, regardless if you actually need it or not. Look for a laundromat equipment distributor that is focused on listening to your requirements, goals and needs, not one that is all talk and tells you what you need. There are some cases where you might not know what you need, but that is another story ( or post ). There are some great resources online, such as the Coin Laundry Association. The CLA will also provide you with plenty of information on how the business and industry works. You can meet and discuss with other operators as well, learn from their successes and failures. You can also talk to other people in the business and find out who they use for their commercial laundry equipment, service and supplies. One key thing you should do when selecting a commercial laundry machine and equipment distributor is to check as many references as you can. This is such a crucial part of the process and if you forget or don't even do it, you might be getting yourself into a bad situation with a pour supplier.

Commercial Laundry Supplies

Every single laundromat needs a constant and reliable source of laundry supplies. This also presents a dilemma to those that are not already involved with the laundromat business and where to locate and secure a contract with the various suppliers out there. As with any business, you will need to do your research as well. You also have to watch for the good and bad ones out there, but in this mature industry, they are few and far between. As a general rule, the suppliers and distributors with any kind of longevity and history in this business will likely meet your needs. The laundromat industry is a very mature business and anyone trying to scam people in any way have already been weeded out from the pack. As with any supplier, you should also check the references. Find out what other laundromats use or have tried. If you are not directly competing with another laundromat, you should talk to the owner ( say one that is across town ). Then see who they use for supplies and how they like them, that would probably give you the most information.

If you are looking to buy a laundromat, or build a new laundromat business, you will need to know who to do go for commercial laundry equipment and supplies. Do your research and make sure you ask for and check references for any other business you will be dealing with as a laundromat owner.

Monday, April 20, 2009

Building a Laundromat Business instead of Buying one

You may have already been looking to buy an existing Laundromat, but you may also want to consider building one from the ground up. This is a great business to build, a laundromat is a good opportunity for anyone who wants to earn a great living. As with any new business, especially building one from scratch, you will want to know the aspect of that business up front. Building a laundromat is no different from any other new business, you will need to have a knowledge of the commercial construction process, or have someone you can use who is. Let me start by telling you that your initial costs for building a new building and business will be a lot higher up front, so your budget will need to be larger accordingly. some of the benefits of building a new building and business is that you can incorporate the most efficient services and building aspects, where you can't necessarily do that if you were to buy an existing laundromat business. The great thing about the laundromat service industry is that it can be very profitable is run correctly, so setting up an optimal business from the ground up may net you more profit in the long run that you could ever achieve with buying an existing one.

In your research you will want to evaluate the location of your new business more then anything. The right location will make or break you, so don't cut any corners here. As with finding an existing laundromat to buy, you will be making the same evaluations as to proximity to your home and your commute time, the location and neighborhood you wish to build, available commercial lots, parking, access by major roads and visibility.

You can partner with an existing laundry machine supplier who can help with the setup of a new business. By helping you and arranging lots of the little "hidden" items that may come up in this industry, they benefit by your using their equipment. You will need to have coin-operated and/or card reading technology washers and dryers. Most new machines today have both options. The card-reading machines allow the customers to fill up an electronic credit card to use in the machines. This ads to the convenience for your customers and saves them from carrying pocket fulls of coins. If you are looking to start the new business on a smaller budget, you can still go with the standard coin-operated equipment. They are usually cheaper and will have less features, but they will fit the bill in a pinch. It is my recommendation that you opt for the dual coin/card reader machines as well as machines that are medium to high end quality and durability. Having more efficient and longer lasting machines will save you in operating costs in the future. This is where the higher up front costs will apply too. Spend more money up front to save more in the future and increase your profit margin.

Once you have determined you machine and dealer you will use to help setup your business, you will still have to evaluate the final location for you business. Part of this evaluation will require you to investigate your customer base. You can use existing demographic services for any major city to find out what your customer base is. Use the industry experts to show you what demographic has the highest usage rate of laundromat services. You can use the pre-existing information available to you to help make your decision on the location. You can cater to nearly any market, but knowing the market ahead of time will make it easier to build for that market too. You should spend some serious time investigating your customers and the market you intend to setup in.

Once you have determined your market, location, equipment and amenities you plan to build into your laundromat business you need to start the process. Once you begin, the laundromat business will start to pay for itself in no time, and with proper management and maintenance you can make a great living for many years. Beginning the building process requires some expertise in the commercial building area, you should hire an experienced contractor or service that can do this for you. First time buyers or builders will usually fail without the proper knowledge or help. Use the manufacturers services and expertise in the industry to help you in the right direction. You can also find several equipment manufacturers that will actually arrange the commercial building process and setup for you. You just give them the money, they build and research everything for you and you just show up to pick up your keys when they are done to start running it.

How to buy a Laundromat for Beginners

If you are looking for a business to buy or build, as a beginner into the business world you need to consider a few things. If you are considering a laundromat as your first business, you will want to know a bit about buying or building a laundromat before you get right into it. There are a lot of details that often get overlooked by people who are doing exactly what you are doing, looking for a business to buy or build. In their research, or lack thereof, people often miss subtle items that come back to bite them later. When buying a laundromat business you need to look at all the aspects of that business and the laundry industry as a whole. Without adequate knowledge, you could be left in the dust by your competition.

Lets talk about buying an existing laundromat business. I will go into how to build a laundromat service from the ground up later. For now, you will need to focus on the existing business. In your hunt for the perfect laundromat, you will need to start off with your basic items. This will include the location, the size of the business, proximity to your home and your commute, options if you plan to move, your budget and pre-arranged lawyer, inspectors and industry expert. I guess before you even arrange any of those items, you first need to decide if buying a laundromat business is right for you. These pages may help you decide if a laundromat business is right for you. I recommend that you not only check out my site, but others as well. You need a broad range of sources and input to evaluate your business goals and career intentions. A Laundromat is simply one option, there are many other business opportunities out there you can review and research.

Purchasing a laundromat is like any other business that is for sale, you need to find it first. There are laundromat specific listings online, as well as general business and franchise listings online or in your local papers where you can find existing businesses for sale. That should be your first starting point. Once you find a suitable business, you will need to check it out. Investigate all aspects of that business, and use the services, get a feel for the neighborhood and customers, get a sense of the atmosphere and if it is a place you would like to work and invest your time and money into. Once you have found that perfect locations, you will need to discuss your offer or intent with the seller, at that point you can look into the actual business further, such as the paperwork, income and books, costs and more detailed stuff. Use your lawyer and industry experts and building inspectors to evaluate the business from their point of view. You should also evaluate it against similar laundromat or laundry service businesses, such as dry cleaners, etc. With a letter of intent, you can secure the offer and restrict the seller from discussing the sale of the business with any other prospective buyers. This puts a hold on it if you will. You will need to negotiate a holding time where you must decide if you are to continue with the purchase or decline.

The time that you have as negotiated by your letter of intent and agreement with the seller, you need to now spend your time to inspect and evaluate the business. Determine if you are getting your money's worth and if the price is a fair value. Examine all aspects of the property, equipment, etc. Having an industry expert available to help you with the evaluation will make your life a lot easier too. Get to know all the employees and customers too if you can. List and itemize all equipment, age, service records, utility costs and what is to be transferred as part of the sale of the laundromat. You need to determine all the building information, inspections, building codes, any faults, any repairs required, leasing information, taxes, etc.

Then you will need to determine your rate of return, or the profit you will or can make with the business. Determine if you will be making money right away or if you will be running at a loss until something is corrected or you have to invest some money into it. Review your competition and how long each other laundromat has been in business, who has the biggest or most loyal customer base. Determine how your prospective business compares and how it is viewed by the community. You may find some easy wins for this business to make it more profitable and attract more customers by knowing your competition up front.

Upon deciding if this laundromat business is right for you and within your budget, you will need to have your lawyer draw up the terms and conditions of the sale / purchase of the laundromat business. Make sure your lawyer is proficient in small business sales and preferable familiar or experienced with the laundromat industry. Use your lawyer to complete all the legal and financial stuff to acquire your business. In no time, you will be running your very own, profitable laundromat business.

Friday, April 17, 2009

Coin Operated Laundromat Machines

When you are buying, owning or considering to build or buy your own laundromat business, the key part of that business is the actual machinery. The coin operated laundromat's primary survival is the quality and dependability of the washing and drying machines in them. If you are going to buy an existing laundromat service business, then this will be a crucial point in the evaluations. You will want to know every detail of the equipment's history, usage, life expectancy, etc. Without a proper equipment evaluation, you could be setting yourself up for a disaster after you purchase the laundromat and then find out that all your equipment is about to fail or is failing. This can cause you to put in extra time and money that you did not budget for and sink you before you even start.

The laundromat machine business is a huge business and there are a lot of different vendors and manufacturers on the market. Each will have it's own pros and cons too. You will need to look at your options and determine what you want to spend your money on. A budget will be your key barrier when it comes to equipment. You can buy cheap and you can buy top-of-the-line machines. Where do you want to be? probably in the middle to high end range. Why? because having good equipment that lasts a long time will serve you better in the long run if you want to keep this business and make a good living from it.

Buying used laundromat equipment is one option for someone on a really low budget. This is a very viable solution for re-equipping an existing laundromat that you have purchased or fitting a new building with equipment quickly. This is a great way to re-fit a laundromat that was purchased at a really low rate because the equipment was old and the owner did not want to invest in new machines.

Buying new equipment for your laundromat is usually something that you do if you already own one and are re-fitting or you are building a laundromat from the ground up. In this case there are many manufacturers that will offer a great range or products and services to both get you started and help setup all the machines. You can arrange to have local service contracts and warranty on all new machines too. This will save you a lot of headaches and time if you have a number you can call for someone to come out on warranty or service contract for any problem that occurs.

Equipment efficiency will and should be a part of your research too. Having high efficiency machines in your laundromat will do many things. First, you will use less water, power and gas to operate them. Even 1 or 2 % can mean thousands of dollars in lower operating expenses each month, thus increasing your net return. Make sure that all your machines are front loading. A front loading washing machine is usually 25% to 50% more efficient then a top loader. They also clean better and use a lot less water. All that saving in water and power will add to your pocket and bottom line profit.

Buying a Laundromat Business Tips to Remember

You have to consider who is going to use your laundromat service. People who have clothes are already washing them somewhere, and will wash them again, probably at the same place they did last week. So the question becomes, how do you get them to come to your place of business of the laundromat they already go to?

There are a few things you need to consider if you are buying a Laundromat or building one. The first obstacle you have is going to be how to get those customers who already use another laundromat to come to yours. If you can, be more convenient for them to get to, or use. Having newer and better equipment, a nicer atmosphere and environment as well as a very clean store will be the best ways to attract your customers. If you are considering buying an existing laundromat business, you should look at it as if you were going to build it yourself and if it has all the amenities you would put into it. A well equipped laundromat will do more to bring in new customers then having the best advertising or locations.

Time is limited and for most people they want to get in and get out. So, one of the biggest draws will be larger capacity machines that complete the wash and dry cycles in faster times. Larger and higher capacity machines usually mean a bigger investment up front if you are having to buy equipment for your laundromat, but the rate of return will be higher. This will allow you to serve more customers in less time, bringing in more revenue.

If you don't know this by now, then you should not be looking at this article. You need the right location to make your business successful. Location, location, location. This is true to some respects, but in today's economy and market, you do not need to be on the corner of the local street to attract business from that neighborhood. Almost everyone uses a car to get where they want to go. People drive to their Starbucks, big market stores, etc, so why not drive to the laundromat, and they do. People will travel further to their favorite store or laundromat because they like, not always because it is the most convenient or closest to them. Developing your business atmosphere will help to keep and attract those customers. So, the location is not always as important as having a convenient location. When I talk about a convenient locations, I mean a convenient location by car. So if your laundromat is easy to get to from major roads and not a hidden strip mall, you will have a better chance at keeping customers.

Research your location for your laundromat, of if you are buying an existing business, you must check out the surrounding areas. Visit the laundry rooms of any local apartment buildings, see what they are like. Most apartments I have visited usually have inadequate machines, old, and often out of order. If you find many apartment buildings in this kind of shape, you are in a prime location to receive lots of local business. There are many other factors you will need to consider about finding the right location to buy your Laundromat, or build your own Laundromat. Spend most of your time finding the right location for a new business and carefully study the area of any laundromat you are considering to purchase.

Coin Operated Laundromat Services

If you are reading this, then you are already interested or dreaming of owning your own business. Coin operated laundry services are a great business to be looking into as well. The laundromat business is one of the better businesses to buy or build on your own. You do not need a lot of capital to start or even buy an existing laundromat business. What you do need is a little knowledge of how the business works if you are not already involved or working in the industry.

Some of the services that are involved with a laundromat are obvious, yet some of the other services that tie into the business are not as evident. You can make some huge profits out of the additional services and amenities that you provide for you customers.

The primary service that will attract you customers is of course the laundry service itself. This must be your primary focus. Your laundromat must have machines that are all in good working order, clean , safe and easy to use. The better your equipment, the more efficient you can run your business. Lets put it this way, if you run top of the line, high efficiency machines, you can have a faster client turn around, which means more people through the door and more money in your pocket. You need to make sure that all your equipment is serviced regularly and inspected by either yourself ( if you know what you are looking for ) or by a service company that you would arrange a contract through.

There are also a lot of additional services you can offer that will also attract new customers and keep existing ones. You can do pick up and delivery services. Investing the time and money into a pick up and delivery service, especially for areas of your city that are in the higher tax bracket opens up a huge market.

You can also incorporate Dry Cleaning services either within your laundromat or simply offer the convenience of a pick up and drop off. Many people have dry-clean only clothes or use the dry cleaning services often. In cases where you can arrange a deal with a local dry cleaner to provide them business you can get a cut of the charges. This will in turn create additional revenue for you and you are doing very little work for it. You can incorporate this with your pick up and drop services as well.

Laundromats do not have to be only coin operated machines, you can also offer specialized services such as fabric and garment care. These type of services will usually be on site and have either yourself or an employee that can fix damaged garments and fabrics. Also , you can offer stain removal services on site. If someone cannot remove stains themselves they might be inclined to have someone else do it, and if you offer such services on site you can make a good profit margin from them as well.

Friday, March 20, 2009

Where do you start? Buying a Laundromat

How to buy a Laundromat

I decided to share with everyone the information you need to buy your own Laundromat business. Why? why not. Mostly because I don't feel that giving away the information will affect me and my business at all, and having other people with the right information in the Laundromat business will only make it better. There are a lot of lessons to learn with a coin laundry service, but they also apply to any small business venture. The coin operated laundry business is fairly simple and if well managed can produce a very good income for anyone.

This industry is a self-serve industry, also known as a coin-operated laundry service. The great thing about laundry is that it never stops... it's not weather dependent, it has no high or low season, it does not rely on tourists either. Ok, a bit of a lie, it is somewhat weather affected... meaning, the worse the weather and the dirtier it is outside, the more clothes people have to wash. They have to wash them somewhere. Once setup, you will find that you spend most of your time collecting and counting all those coins.

Finding a location and a willing seller is probably the hardest part. This business is such a profitable and easy business to manage, that many people don't give up the easy income. There are still many cases where some people have either not managed it properly or have run into other circumstances that require them to sell their Laundromat business.

Once you have found a location and seller there are many things that need to be done. First and most obvious is a purchase price for the business. Complete and LOI, which is a Letter Of Intent. This letter documents your desire to purchase and the sellers desire to sell. Remember that this letter is not a legally binding document to sell, rather like a promise, if you want to call it that. You need to also clearly list all the assets and other stuff that will transfer with the sale of the Laundromat business. Once of the key features of the LOI is that is prohibits the seller from discussing or pursuing other potential buyers. Do not rush this process, make sure that you establish the sellers intentions and document a standard 90 day evaluation period in the LOI. This period will allow you to determine if the selling price and other clauses in your negotiation are a fair to you. You can also use this time to understand every facet of the sale, especially if this is your venture into owning your own business. You must also spend the time to determine the actual value of the business.

Get yourself a good lawyer to review your contract. Either to review or draw up the contract and terms of the sale. An experienced and skilled contract lawyer will save you time, money and prevent you from getting into a deal that is not beneficial to you. Ensure that both the seller and buyer have their own lawyers, this will prevent any conflicts or bias any one lawyer could have.

Determining the value of the Laundromat is similar to evaluating any business really. Review the last year of the books and determine the cash flow, expenses, debts, taxes, etc. Find the property value and property taxes. Equipment, leased or owned by the business? does any need replacing? if so, negotiate that into the purchase price or conditions. What is your competition? What are the employees like and how long have they been with the business? What is the community feel with the business? You should also check any local business associations like the better business bureau for complaints or other filled paperwork regarding the Laundromat in question.

There are some points you need to consider before you buy a Laundromat. The business itself , as well as many others, has it's share of dis-honest people. You need to take all precautions to prevent being taken to the cleaners ( if you know what I mean ). Coin operated Laundromats are very appealing to investors, such as yourself because they are profitable and fairly easy to manage. They are not always transparent in the operating costs, you need to take the following steps to ensure you are evaluating the business as it is represented. Have an analysis done by verifying the gross sales with the water and fuel usage. By doing a detailed analysis of the water and fuel usage you should be able to see if the claims by the seller are accurate or exaggerated.

If you are not fully comfortable with doing the evaluation and analysis on your own, hire an expert. Look for someone experienced in the coin laundry business, they will be able to identify all the pros and cons with the Laundromat you have selected or intended to buy. Remember that the seller or broker will almost never tell you about any problems the Laundromat is facing and in most cases will try to hide or re-direct you from them. A contract lawyer is not going to do this, at best they can evaluate the business in general, but will not be able to give you an accurate evaluation of the coin operated Laundromat business.

Ok, now that you have determined all the legal and financial stuff, there is still more you need to consider. Maintenance and service can be a large cost, if you are able to maintain and service the equipment yourself, you will save a large amount of money. Many of the newer equipment and machines require very little maintenance and are designed to be heavy duty, long lasting items. However, with any coin-operated laundry machine, something can always happen.

Building instead of Buying a Laundromat Business.

Building a Laundromat in a new location still requires the same, if not more commitment and research. There are many laundry equipment distributors that have experience with building and setting up a new Laundromat. Inquire with a distributor in your area first, they will often offer a full service and build everything for you. Acquire a proposal from the distributors in your area, as well as a review of the demographics, locations and competition, then consult your coin laundry expert.

All the other research applies , but without buying an existing business you will have to determine your startup and running costs with an expert in the coin laundry business. If you don't you might be getting in over your head and have to sell. This is the type of business you actually want to buy, from someone who did get in over their head and must sell the business at a loss, don't be that guy.

This article was posted as a supplement to your research and is not intended to be a guide. This information should not be regarded as comprehensive.

I wish you well in your search for buying a Laundromat and may you find exactly what you are looking for.

About Buying a Laundromat Blog

This blog is about how to buy a laundromat business. This will help you and/or others with the information needed on how to research, find and evaluate the coin operated laundromat business. There is a lot more to it then you might think.

If you are just starting you search, or just looking at the viability of the coin laundry business, then you have come to the right place.

I will cover in my next post the details on how the laundry business works, the locations, the do's and don'ts, and much more.

Please feel free to contact me if you have any specific questions regarding the laundry business.



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