How to Start a Successful Laundromat Business
As a leading distributor in the commercial laundry equipment industry, we’ve helped a lot of entrepreneurs successfully start their laundry businesses with top-quality industrial washers and dryers from Dexter Laundry. Here are some tips for anyone considering a launch into the vended laundry industry.
Perhaps you’ve heard that coin-operated laundromats make great passive income businesses, or maybe you’re part of the proud tradition of family-owned local retail business and you’re ready to set out on your own. Or, maybe you want to be your own boss, running an essential business that will always be in demand. Whatever your motivation, we’re enthusiastic about working with you to outfit your new business with best-in-class Dexter industrial washing machines and dryers that have helped our other clients start their successful laundromats.
While opening a laundromat has the potential to generate substantial income, depending on how you manage expenses, the days of finding an old laundromat for sale, making a few updates, then showing up at the end of the day to collect the money from the machines are over. While that may have been true 40 years ago, today more laundromats are popping up in more locations—they have nicer facilities, amenities like free Wi-Fi or USB charging stations, value-added services such as fluff and fold or delivery, and card payment options. With more competition and a changing business landscape, investing upfront is more costly than it has been in the past, but laundromats still present a solvent business model to make you money even if you’re not always on the premises.
From our years of experience, here are our top tips for starting and owning a successful laundry business.
Understanding Laundromat Start-Up Costs
The first question most people want to know is how much it costs to start a laundromat. When you’re considering your laundromat, you’ll have to decide if you want to buy and upgrade an existing business or if you want to rent/buy a space and build your own laundromat from scratch. Either way, we recommend you invest in reliable, new machines. After all, customers will keep coming back if they like the way your machines clean and dry their clothes without causing them any inconvenience like cutting out half way through a cycle. Utilities, insurance, licenses and permits, marketing and advertising, and additional vending equipment all factor into start-up costs. However, if you plan to operate a self-service business only, maybe with one or two few part-time attendants, labor costs can be relatively low. Keep in mind that where you live affects costs, but the ballpark figures to open an average-sized laundromat range from $200,000-$500,000 or potentially much more in a competitive urban area.
Importance of Business Location
Owning a successful laundromat means finding the right location from the start. The laundry demographic tends to be people who live in smaller spaces without room or a budget for a washer/dryer. So, a laundromat has a better chance for success around apartment complexes, rental neighborhoods, shopping centers, strip malls, or dorms. Customers will want ample parking if you’re in a car-dependent area although that won’t be as big of a concern if you’re in a dense urban area with a lot of foot traffic. In short, make sure your laundromat is conveniently located in an area populated with people who likely need easy access to good washers and dryers.
Attracting and Retaining Customers
Many new laundromat owners make a rookie mistake of thinking of their business as transactional and not experiential. In other words, a laundromat isn’t like a row of vending machines where a customer walks up, drops in coins, gets something, then leaves. Most customers spend time there with their personal belongings. They want to feel comfortable in a clean environment; they want to feel safe and secure. A nice atmosphere keeps customers returning. They want to have a pleasant experience in your laundromat. On a related note, successful laundromat owners understand the value of good customer relations—smiling, meaningful small talk, quick solutions to customer problems, getting to know your regulars by name. Building a sense of community or a welcoming vibe in your laundromat can make a huge difference in your success and word-of-mouth advertising (especially if you’re competing with other laundromats in the neighborhood).
Value-Added Services: Making More Money with Your Laundromat
Another strategy for attracting and retaining customers is to incorporate value-added services like delivery, upsell options, or food and beverages. Today, it’s not uncommon to visit a laundromat with free Wi-Fi, a cafe, child-friendly amenities to occupy little ones, or extra-cost services like drop-off where your attendants wash, dry, fold, and prepare customers’ clothes for pick-up. In the beginning, you may not have the extra income to set up a falafel stand (as did one of our clients) or a play area for children. That’s okay. You can still set your laundromat apart with budget-friendly decisions like soothing colors, extra-clean bathrooms, inexpensive coloring books and crayons, and top-tier customer service. As you begin to make money, you can make bigger investments to set your business apart. The point is to give your customers a little something extra that makes them want to use your business instead of someone else’s.
If you’re ready to talk about opening your shop, we’re here to discuss your options for top of the line Dexter washers and dryers. Our Laundry Specialists are happy to sit down with you and provide guidance relating to key decisions such as store layout and equipment mix, based on our many years of experience in the industry. We’ve published a number of success stories so you can read about other laundromat investors’ experience to learn more.