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Laundromat Business A Good Bet

by The Laundry Biz

The laundromat business has really grown in popularity in the last decade. This is especially true for first-time business owners and investors. Here are some of the main reasons why they have become a popular investment, and why they might be the right business for you:

Laundromat Business Easy To Operate1) They Are Relatively Easy To Operate

We hear all the time from investors interested in getting into a laundromat business. They have heard that with a laundromat, they wouldn’t have to work and just had to show up to collect the money. While this is pretty far from reality, it IS true that a laundromat business is a much simpler operation than many other types of businesses.

Unlike a typical retail business, there is very little or even no inventory to manage. The list of employee tasks for a laundromat are much more controlled. Also, the number of employees to manage is comparatively small. You typically need very few local permits or inspections compared to other businesses.

You also need fewer special skills or requirements when starting out. A background with bookkeeping and management skills is a definite advantage, but not immediately necessary. Marketing and advertising skills are also helpful but can be learned. And while some knowledge of the laundry industry is recommended, it can be picked up quickly using trade journals and organizations.

2) A Laundromat Business Is Recession Proof

Laundromats are considered one of the top-five recession-proof businesses. Every business is subject to market cycles, and this is also true of the laundromat business. Most laundry locations will see seasonal differences in their level of business. These can be attributed to the weather or when local schools are in session.

However, the laundromat business is relatively insulated from the national market and economy. The bottom line is that people need to wash their clothes. This is true whether the market is doing well or is tanking. In fact, many laundromats tend to see an increase in business when the economy is dragging. This is likely due to an increase in renters versus homeowners, and other similar factors.

3) A Laundromat Business Deals In CashLaundromat Business Deals In Cash

A laundromat is considered a cash business. This is the case even for card-operated laundromats as well, though many are still cash-only. It is one of the few cash-only businesses that are still going strong.

The key here is that there are no accounts-receivable, no customers being billed, nothing put on layaway. Washers and dryers are paid for in advance at the machine. Drop-off services are paid for either in advance or when the customer picks up their clothes.

4) The Customers Provide Most Of The Labor

How many businesses can you think of where the customer provides most of the labor? Car washes and gas stations come to mind. The laundry business also fit this definition.

Customers bring in their clothes from the car, load them in the washers and dryers, then carry them back out to the car. The majority of walk-in customers are completely self-sufficient and many never even interact with employees.

The employees provide some customer service and keep the store clean. If drop-off wash & fold services are offered, employee labor is required to clean, dry and fold the laundry. The majority of a laundromat’s income will still be from the walk-in business.

Laundromat Business Competition5) Your Competition Is Limited With A Laundromat Business

Competition is healthy for any industry, but too much competition can make it difficult to survive. Luckily for the laundromat business, there are some barriers to entry that make it a little more insulation from competition than other industries.

The internet has been a remarkable and transformative force in business. However, it has gradually destroyed local retail businesses. Traditional brick & mortar stores have suffered immensely, both large and small businesses. Thankfully, nobody has yet figured out a way to wash their clothes on the internet. And we don’t anticipate that to happen! This makes the laundromat business one of the brick & mortar industries that is protected from the internet.

Another barrier to competition is the relatively high capital cost of opening a laundromat. To open a new location, a significant investment in equipment and infrastructure needs to be made. That is why existing locations are so attractive. Also, any good lease with a commercial retail center will include a provision preventing the landlord from allowing another laundromat to open in the same center.

Have Any Questions About The Laundromat Business?

We offer laundromat consulting and can help with all aspects of the laundromat business. If you haven’t already done so, subscribe to receive our articles and also get a free laundromat business plan template!

The Laundry Biz
About The Laundry Biz
We help people interested in learning more about the laundromat business and can answer all questions big and small about getting into the business and running a successful operation.

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Laundromat Business A Good Bet
The Laundromat Business – 5 Reasons It’s A Good Bet