Being a small business operator is never easy in any economic climate, so finding a business with high demand and low running costs is every entrepreneur’s dream. Businesses such a vending machines and laundromats are popular because they do not need large staff numbers to keep them operating.
Industry Knowledge Helps When Buying a Laundromat
Laundromats in high population areas are particularly desirable. However, like any business enterprise, having sufficient capital to get started and some knowledge of the industry is often the difference between success and failure.
As suppliers of laundry equipment, we have many clients who are successful in the laundry business. NLE Commercial has an industry leading range of washers, dryers and finishing equipment. We also have spare parts for all brands of laundry equipment and our trained technicians provide a 24-hour breakdown service.
First Survival Tip – Location, Location, Location
From our observations, there are a few things that someone coming into this business with little experience should know to reduce the risks involved. First is getting the right location. A highly populated area close to cheap parking is perfect. Most people using a public laundromat will wait for their washing rather than leave it and come back later.
Workable Lease Agreement to Recoup Initial Costs
The lease agreement needs to last long enough to recoup your investment. Many businesses can pick up and move locations if their lease is not working out, but for a laundromat, this would be very expensive and the absolute last resort. Before signing, have the lease checked by a legal professional familiar with this type of business.
Control Water and Power Costs
Keeping water and power costs under control will also be critical to long-term success. If you are buying an existing laundromat, check the water and power bills for the last couple of years. Unusually low costs may indicate that the business is not as lucrative as it seems, while very high costs may offer an opportunity for cost savings to increase profit.
Evaluate Existing Equipment
Evaluate any existing equipment for its age and reliability by recording the make and model numbers of the machines. Check these with an expert who may be able to estimate the expected life span, the probable cost of maintenance and the likelihood that some or all of them will need to be replaced very soon. Having to spend money on new machines will place a heavy burden on capital costs for a new owner.
Just like any other business venture, due diligence is essential to get the most out of your investment. Owning a laundromat can be very lucrative, but only under the right circumstances.