Buying a laundromat is a smart plan that many have used for years. Since everyone needs to wash clothes, it might be a good choice to start a business in this area. If you want to try this well-used business idea, keep reading to learn how to buy a laundromat.
Is buying a laundromat a good idea?
Buying a laundromat might be a smart move. The chance to earn money makes it a tempting choice. If you find the right place and chances, owning a laundromat can be good.
The Coin Laundry Association says a coin laundromat’s price can be from $50,000 to more than $1 million. They also say you can earn $15,000 to $300,000 each year from one.
Pros of buying a laundromat
Owning a laundromat comes with many financial perks. If you think about this side hustle, let’s explore the benefits here:
Passive income. The great thing about passive income is not having to work all the time to get money. A laundromat gives you one of the best ways to earn easy income. Sure, the hard work at the start isn’t easy. But this work can lead to easy money later on.
More ways to earn money. Having more ways to earn money can make your money future stable. If a problem hits one money source, you have others to help. A laundromat adds one more source to your money mix.
For instance, think about having a full-time job and a laundromat. If you lose your job all of a sudden, the laundromat money helps you and your family stay okay.
Small business costs. This business kind mainly needs machines, not many workers. So, running a laundromat might not cost much for workers.
You can choose to run the business by yourself. Or hire one or two people to assist. In both situations, the main help comes from machines, keeping worker costs low.
Get cash upfront. Laundromats get money before giving the service. Unlike other businesses that wait to get paid, laundromat owners get paid right away.
For a business owner, getting paid at once is clearly a good thing.
Full-time business or part-time side hustle
As you learn how to buy a laundromat, you will think about the time needed. You might choose a way that needs less work by finding a person to run the business.
Usually, this person will open and close the place, keep it clean, and call for fixes when needed.
Yet, you might want to work more, needing full-time work. Doing full-time work, you will open and close the business yourself. Also, you will deal with customer problems often.
Choosing full or part-time depends on your money state, if you want to have workers, and the time you can give to the business.
How much does it cost to buy a laundromat?
To know exactly how much to pay for a laundromat is hard. Usually, it is from $200,000 to $500,000.
Many things set the price. You also choose if you want a brand new laundromat or one that is already open.
Also, will you buy gear? What other things will you buy? Answering these questions will help you know the cost.
Can you buy a laundromat with no money?
You might wonder, “Can you get a laundromat with no money?” You are not the only one. It can happen. Because a laundromat costs a lot, many new owners need to find money help.
Usually, buying a laundromat or getting money help needs some payment at first. But with a good business plan and lots of experience, a money lender might give you a loan without a first payment.
So, is it the right time to put money in a laundromat? It can happen if you find the money you need.
How to know a laundromat’s value?
To know a laundromat’s worth, you do a value check. This check helps find out the business value.
To find the value, you look at many business parts. This includes the profit after costs, rent deal, other shops like yours, the place, machines, and more, says Laundry Solutions Company. Also, they say you use the profit after costs and a number you pick to find the value.
Most times, laundromats get a value from a number times their profit after costs. You find this profit by taking away the costs from the total earnings.
For instance, if the shop makes $200,000 each year and spends $50,000, the profit is $150,000. The number used is often between 3.5 to 5 times. So, the value is 3.5 to 5 times the profit.
Buying a laundromat: things to consider
Heading towards buying a laundromat? Here are important things you should know before you take the step:
Be aware of the total loan costs. Going for a loan to buy the laundromat? Be sure to know all the terms. You want to know the full cost the loan brings. It’s vital to add these costs when figuring out if the business will give good returns. Shop around to find the best loan deals and save on interest.
Expect to manage repairs. Machines in laundromats can stop working. When this happens, the broken machine can’t make money. So, fixing it fast is key. As the boss, you can pick to have a handyman on call. Yet, if you can do fixes yourself, you might keep more money in your pocket.
Think about hiring staff. Laundromats usually don’t need much hands-on work. The machines do most of the heavy lifting. But, having staff to help people, keep the place tidy, and do other jobs is common. If handling staff isn’t for you, owning a laundromat might not work well.
How to buy a laundromat
Wanting to buy a laundromat might leave you wondering where to begin. After all, it’s not as easy as buying a home or starting an online business with many helpful tools around. To help you, I made a simple step by step guide to buying a laundromat.
Chat with current owners
To buy a laundromat, start by chatting with current owners. You need to know what you are entering into before you decide to buy.
Spend hours asking things. Learn by hearing what other laundromat owners have to say.
If something catches your ear, ask to learn more. Many owners might like to share a lot with you.
To find laundromat owners near you, do a fast Google search. You will get their business contacts too. Call them or email them to see if they can talk about what they know.
Learn about the laundromat business
Now, get ready to learn about owning a laundromat. You have to know the normal costs in your place, the amount you can pay, the earnings to expect, and the hours it takes. Loopnet.com and Buybizsell.com are good spots to find out what to pay.
As you see what’s happening near you, decide if buying a laundromat is a good deal.
Location, location, location
Researching your city is key when learning how to buy a laundromat. Some areas might not need a laundromat if most homes have washing appliances.
Yet in other places, many people rely on a laundromat because they lack these appliances at home.
As someone wanting to start a business, picking the right spot is vital.
Learn about different areas and the kinds of homes there. Also, check if other laundromats are already serving those places.
Also check for good parking and easy access for people. This is all about picking the right spot.
Get help from a broker
Brokers usually know about laundromats for sale. If you want to buy, a broker might find good options for you.
Yes, brokers take a part of the sale money but they can help you find a good place to buy.
If a broker can’t find a deal, try visiting laundromats in your town. Ask the owners if they want to sell. Asking can sometimes work.
Check all the costs
In all business plans, checking all the costs is vital. You need to ask, “What is the total cost to buy a laundromat?”. You must be sure that the business can earn money or has the chance to do so in the future.
Laundry Solutions Company says to think about the power bill and the rent. People usually spend $4,000 to $8,500 each month on a laundromat.
Keeping the machines working is another cost. Old machines often need more money to keep going.
So, when you think about earning money, remember to count all the costs.
Get the money ready
Like many new businesses, you will need to pay a big amount at first. If you are like most people, you don’t have a lot of money to use right now.
You have a few options to get the money. You might get a small business loan or a loan from a bank near you. You might also think about a personal loan.
Still, the top way to buy a laundromat is with small debts. So, you might have to save money for a while before you can buy.
Run the business
After buying it, you have to run the business. You will do basic things like fixing machines, getting the money, keeping records, and keeping the place clean for people who come in.
You might change some things to earn more money. You could wash and fold clothes for people. You might get money machines or sell things people need to wash clothes.
As the boss, you will do many things. You will tell people about the business, find workers, and do many other daily tasks.
Finding out how to buy a laundromat might be your pathway to earning more!
Starting a laundromat business could be a smart way to build a steady stream of extra earnings. While this business could be a jackpot for many, it is not the right path for everyone. Make sure to weigh all your choices before deciding on this method to boost your earnings.
True, laundromats can offer a way to earn money even when you are not actively working. But setting up a source of easy income often needs hard work at the start.
Bear in mind, buying a laundromat to earn without a constant effort does need some groundwork. Even with a ready business, understanding the ropes might take a while.