Monday, April 20, 2009

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.

1 comment:

  1. thank his is everything and more than i was looking for , Dan Kenosha, Wi


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