How To Open A Laundromat | Starting A Small Business
How To Open A Laundromat | Starting A Small Business
How To Open A Laundromat
Interested in starting a business that pretty much runs itself? If that’s the case, then it would be wise for you to consider opening a laundromat. For various reasons, a lot of people do not own their own washer and dryer. For example, there’s sizable demand for laundromats in areas where there are lots of renters because a lot of times the buildings don’t provide those amenities. Also, anywhere there’s a high concentration of students, laundromat services are going to be needed.
These are just a couple examples. The bottom line is that you want to set up your laundromat in an area where You’ll have a steady clientele of people who regularly load up their dirty laundry and either walk or drive to the nearest laundromat to wash and dry their clothes.
First of all, you need to plan ahead. As pointed out earlier, you need a location with a high volume of traffic. Without traffic, your laundromat business venture will be short-lived. The issue of parking can be important, but at the same time, it can also be a non-issue. If your laundromat is in a suburban area where people primarily drive to it, then lack of parking space will kill you, as people will simply drive to your competition instead of looking for parking space. On the other hand, if you’re near apartment buildings and/or student housing, then parking is not something you’ll really have to worry about, as most of your customers will be within walking distance. Of course, you should never underestimate the importance of assessing the real NEED for your business, in the location you’re targeting. Analyze your competition and how you’re going to carve your own space.
Decide whether you wish to set up your business from scratch or want to buy an existing laundromat? In any case, prepare a detailed business plan for each option as this gives you a detailed idea of what you will need to invest in your business. If you’re buying an existing laundromat, some of the things you will need are a business license, tax ID# if you have employees, a fictitious business name, environmental health permit, safety and fire inspections, just to name a few. There are lots of things to consider and all fees and requirements vary by county or state.
If you’re starting from scratch, your initial investment on new or old washers and dryers will be your main expenditure. The decision to go with new machines as opposed to older ones is a trade-off. Newer machines will be more expensive but require less maintenance and vice-versa. Most likely, this decision is going to depend on how much you can afford for your initial investment. In case you’re taking over an existing laundromat, you don’t have to make this decision, but if you’re buying new machines, you also have to decide if you’re going to get coin-operated machines or smart card operated machines.
The location where you set up the laundromat should (ideally) have two entrances; having two entrances in case of emergency may reduce your insurance premiums with some companies. It’s a good idea to have the laundromat in an existing location with the necessary connections already installed (water, electrical, plumbing, and so on). If those connections are not already there, you will have to spend extra to get this job done, which will drive your startup costs higher. In any case, it’s strongly recommended that you get three (3) sets of quotes from different contractors, so you can get a good idea of how much you’re going to need to build the laundromat.
Here’s what you’re going to need, in terms of setup:
- You will want a location that can accommodate the size of your business. You need to decide how many washers you want, as well as dryers. Make sure you find a place that has plenty of room after all the equipment is set up. You don’t want your customers bumping into each other. Laundromats get hot when the dryers are running, even with air conditioning. In the summer heat, tempers can flare if they don’t have enough room to maneuver while doing their laundry. Your location needs to accommodate tables for your customers to fold their laundry. You will need several of them. You may even want a play area for the children. That will increase the size of your location. And it must have restrooms.
- It was mentioned earlier that you can have either coin operated machines or smartcard operated machines. If you have coin-operated machines, then you’ll need a change machine that can accept up to $20 bills. If, on the other hand, you have smartcard-operated machines, you’ll need a smart card center machine for people to recharge their cards.
- It’s recommended that you have one little sink for people to pre-treat their clothes, areas for folding clothes, and rolling carts.
- Have one vending machine on the premises with some snacks, and if you can, a vending machine with laundry supplies, one arcade game, and a TV. You should also sell related merchandise such as collapsible hampers or laundry bags.
- You need some variety in the size of your machines: low price range basic washer and dryers, higher priced stainless steel washers and dryers, a couple giant dryers. When you decide to open a laundromat, make sure you have enough washers and dryers so your business can grow. You want several different sizes of washers. There are the regular top loaders, front loaded double and triple washers. This will handle all of your customer needs, but will also increase the size of the location.
- In terms of personnel, you’ll only need one person, with some paper change for large bills, wiping down washers and keeping the place tidy.
Other stuff that needs your attention:
Maintenance: How will you maintain and repair the equipment? Do you plan to have a repair service come in and fix the machines when they break down? You will also have to plan for a significant amount in order to turn on the local utilities along with repair and maintenance of your machines. You will need to get a regular service contract with the person who installed your machines as this turns out much cheaper in the long run. You will also need lots of supplies to stock your shelves or the dispensing machines, depending on your laundromat’s setup.
Business entity: Incorporate the business before doing anything to shield yourself from any potential liability issues.
Profitability: You might not want to talk to your direct competitors, but how about talking to others already operating the same kind of business, in a comparable setting, to find out if they are profitable, or just “breaking even”?
Ownership: Do you plan to buy the building, or be a renter, paying monthly rent, to a landlord ?
New or existing business: Is the location set up as a laundromat NOW, or will you have to buy and install the equipment at your cost ?
Equity/Financing: How much of your OWN money are you going to invest, and how much “actual cash money” do you have , to pay for the activation of the water, gas, and electrical utilities, and to advertise your new business, and put up a proper sign on the front of the store ? Have you secured financing?
Legal requirements: Have you found out what city or state permits and licenses are required, to conduct this type of business, and what about liability insurance and property insurance coverage? You might need to contact the local city council or the necessary licensing agency to find out what you will need to set up your business. You also have to contact the local Franchise Tax Board to get the required permits. This will help you to buy goods without tax for your business.
Ongoing expenses: You won’t just need one months rent, you’ll need rent, deposit, and some places require you to prove you can afford 6-12 months of rent before letting you rent from them. You’ll need money for all the licenses and forms, insurance, plus all those washers and dryers. Not to mention money to fix them. When used that much, you’ll be amazed at how abused they become. Water and electricity will be your biggest ongoing expenses. Don’t forget about them.
If any of these questions are new to you, or you didn’t know about them, you are not ready to get into a business, yet. On the other hand, other than that person who really is there for constant upkeep, there is no supervision needed. That’s what attracts a lot of people to the coin-op business!
Starting A Small Business
Starting a small business is a serious endeavor that not should really not be taken lightly. Often, it’s the best vehicle to realize dreams such as financial freedom, the ability to travel, or to spend more time with your family. If you take the time to do a couple things before really launching your business, you will give yourself a better chance to hit the ground running and really lauch a successful business.
Importance Of A Business Plan
The first area is your business plan. Your business plan is your company’s calling card. It allows you to see your business through your investor’s eyes. As the name suggests it is a plan of your business; your communication tool; selling your marketing, sales and operations. You should focus on exactly what you want to achieve, where you want your business to go and how you plan to get it there. Projected sales and monthly expenses will also be included in your plan. All of this information will influence your choices, including the type of location you will be looking for.
A business plan is the key to long term success for new and old businesses. Your business must have a foundation to start from and you have to give your business time as success will take longer then a few weeks. Your business plan is a framework which your business must operate within. It will ultimately determine whether your business succeeds or fails. It’s often the key to securing financing. Preparing a comprehensive plan will not guarantee success in raising funds or mobilizing support, but having no plan at all will more than likely result in failure.
Importance Of A Marketing Strategy
The second is the marketing plan that you are going to use in order to ensure that your business is noticed. Marketing strategies are the methods that can often determine the success of your business. They should be considered carefully, as it is important that the right combination be established to ensure the success of your products and services when starting a home business.
When first starting a small business many people may rely on minimal marketing. This is generally due to financial concerns however, marketing is especially important when a business is first starting out. You want to draw as much attention from as many different sources as possible. There are plenty of options that are available for starting businesses that may not have a large budget to spend on marketing but still want the advantages that come from marketing via the internet.
When starting a small business (such as a laundromat), it is important to plan how you want your business to run, as well as how you want to present your business, products and services to the public. Planning before you launch your business is one of the best ways to ensure your business is primed for success.