Why shouldn’t I own a laundromat?

[richardy]

There are a million articles about the benefits of owning one. Tell me why I shouldn’t. What headaches, expenses and pain points exist that aren’t in most blog posts?

 

[kings4ril]

@richardy You should search 'Investment Joy' on Youtube and a take a look at his Laundromat trials and tribulations (and sometimes wins!).

 

[richardy]

@kings4ril Cool will take a look.

 

[denchristian]

@richardy I owned one for 7 years. 3 things. Try to get one big enough to have an attendant. You still have to go there virtually every day to make sure things are going well. And you need to be handy at fixing things. It's a cash business and won't make you rich but it can be rewarding

 

[richardy]

@denchristian Yeah, honestly, I was a little bit skeptical about all these articles that say you can run them completely hands off. I was thinking of one that was a little little bit larger and could have a wash/dry/fold option. At least if there was somebody around for doing that they can keep track of the place and make sure nobody smashes the place up and help people out as needed. Can I ask why you sold?

 

[khankorp]

@richardy Wash and fold is where the money is. I owned for about 4 years. It just got to be too much with out enough financial reward. You definitely have to go at least once a day sometimes more.

If you are going to have an attendant you need at least 2, probably three or more (different shifts, how busy they are with w&f, days off- this can effect the hours you are open as well). That adds a layer of extras... Payroll, ui, workers comp...

If you're not able to fix the machines on your own it can get expensive real quick-cutting into profits big time. Replacing the machines is quite expensive as well (make sure you know the age of the machines, their expected lifespan, if they're owned/leased and terms of lease before you buy).

Also if you're going to sell things like laundry bags, detergent, drinks, snacks, etc you need to get a resellers license... And do all the reporting, etc that goes along with that.

I personally don't think it's an absentee business, especially as someone new to the industry. It's the best if you own the property and are not renting (that was my biggest expense, by far) I also feel like you need at least three locations to make it your main source of income.

 

[theslingstone]

@richardy I would be contracting with the local motel/hotels to do some of their business.

The wash and fold business, can be the breadwinner.

LP or propane? or just electric?

 

[richardy]

@theslingstone In the areas I’m thinking about I would probably say city gas in most/all locations for drying. Our electric rates are some of the highest in the country in propane, is certainly more expensive than city gas. I heat my home with propane and I certainly wish I still lived in the city that had gas infrastructure. Agreed on the wash/dry/fold. Not only terms of profit but in terms of having somebody there, keeping an eye on the place.

 

[s4ado]

@richardy Many places subsidize residential power and gas. For businesses you take it in the shorts and could pay double+.

 

[richardy]

@s4ado I’ll definitely have to check. We are already some of the highest rates in the country and it would be a shame if it’s even higher than home rates but it wouldn’t shock me. Most of my operational costs will be utilities so I’m glad you mentioned it, would be potentially disastrous if I calculated one of my biggest expenses at half or less of reality.

 

[matterik]

@theslingstone This right here. The wash, dry, fold side will be the portion that makes your margins look great.

Also, put cc readers on your machines. It will cost a bit upfront, but will be an excellent way to improve your services for the customers.

 

[cmmarq]

@matterik One brand that I know of…if one reader or connection goes bad it takes down the whole system. Where my ‘mats are, my customers prefer cash…

 

[michaelthemeerkat]

@richardy Wash Fold Dry requires female employees for handling underwear.

 

[humbleknight]

@michaelthemeerkat Alright I’ll bite.

Why?

 

[richardy]

@humbleknight Was going to ask the same. But then I thought about how depraved some people are and they might be onto something. But some women would probably also be a problem in that respect.

 

[jptex77]

@denchristian Is it still a cash business? The few I have seen in the last few years are digital and you either swipe a card or download an app and pay via the app.

 

[denchristian]

@jptex77 I owned mine a while back. Had to carry bags of quarters every week and weigh them

 

[ivi67]

@denchristian 49.95 pounds, +- .05 of a pound.

 

[alex818]

@denchristian I went to a Laundromat that used debit/credit to run the machines it was pretty handy!

 

[jcon1150]

@richardy Depending on how it's setup, you need to put a lot of faith in employees.

You can live and die by utility prices.

Keeping the equipment running can be time consuming, expensive or both.

They're pretty expensive to build out.

Location really matters. You need to pick your location carefully and make sure it offers what your clients need. In some cases it might be near mass transit. Others might be lots of parking. Safety is always a concern.

You need to be comfortable with taking advantage of what makes a laundromat a good business. Some people aren't okay with that.