The idea of a laundromat business is quite profitable as well as popular. And, the most amazing thing is, you can start your laundromat business at home without spending money from your savings. You have a great number of customers in this business.
People without a washer or drier at home will seek the service of your laundromat business. In some cases, people will also need your laundromat business when the capacities of their machines are low.
If you have space at home, you can start the laundromat business from your place. That will help you run your business without paying the rent.
Here are the 10 Steps to Start Laundromat Business
1. Understand the Market
Like any other business, success largely depends on the demand of the local market. It is an absolute necessity to do market research and understand the demand and trends of the immediate market. The information collected will help you in exploring the gaps and plan your business more effectively.
2. Ways to Start a Laundromat Business
There are broadly four ways of starting a laundromat business.
- You can open a full-fledged commercial laundromat business from scratch. You need substantial investment to start this kind of venture.
- If you are short on budget, a laundromat business can be started from home too. The critical aspect of making a profit from the laundromat business at home is choosing the right target audience.
- Another way is to start is by buying a franchise of a reputed laundromat business brand. Buying a franchise removes the hassles of starting from scratch and reap the benefits of the brand value of the company.
- If you have almost no money and still want to get into the laundromat business, start as a coworker. In this case, you need to have your vehicle collect the laundry and deliver it after washing and drying. You get a steady workload and payment. So, there is no cost or hassle of marketing your laundromat business. However, you may have to pay a small startup fee in this case.
3. Create a Business Plan
After finalizing the business model for your Laundromat business, it is time to write a business plan. Write in detail the costs, target audience, financials, marketing strategies, and operational plan. Some of the basic topics that must be addressed are mentioned below:
- Startup and recurring costs
- Service offerings
- Target customers
- Pricing plan
- How you plan to promote your laundry services?
4. Name Your Laundromat Business
It is important to have a catchy name for your laundromat business. A rightly named business will help customers relate to your laundromat business. Give a catchy and appropriate name for your laundromat business. It’s the name that people remember and associate with the service you provide.
Also, it is important to have a relevant domain name as having a website is a must. Check this guide on the steps to be followed in naming a business.
5. Set-Up for Laundromat Business
If you have space in your home and own a washer and drier, you can start a laundromat business with less money. You are not paying rent or spending money on machinery.
You have to make sure that your place is in a residential area, or near hostels or dorms so that several people can access you. They can easily come to your place, drop their laundry and pick them up at their convenience.
If you have a garage, that can be a good place for your at-home laundromat business. That will make your laundromat more visible. Your acquaintance in your locality will help you grow the business.
6. List of Equipment You Will Need to Start a Laundry Business
To start a laundry business, certain equipment is required. You need to list down all the equipment and items to operate a laundromat. Some of the basic equipment are listed below:
- Pressing Machines
7. Go for Grants
For doing your laundromat business you can try getting grants. The biggest advantage of grants is that you need not repay them like loans. So, you can use the money you get as an investment for your business.
There are different types of grants for your laundromat business. For example, the United States Small Business Association or SBA offers grants to small businesses. You have to check the conditions of eligibility. https://www.sba.gov/
There are many local authorities, banks, credit unions, and particular city or state authorities which give grants for patronizing community development or local startups. You can contact the local banks, business authorities, or chambers of commerce for correct information and assistance.
There are also some special grants available for business. Like, the grant for the disabled, which is offered by Governments as well as private organizations, to help set up a business owned by a disabled person. For example, the U.S. Department of Veterans Affairs’ offers such grants.
There are different types of grants for women entrepreneurs. These exclusive grants are offered to startups like laundromats, owned by women. For example, SBA’s Women’s Business Centers (WBCs) and Amber Grant.
There are some demographic grants for senior people and also colored people. You have to check the respective websites to find the eligibility criteria. Both Government and Private organizations offer such grants.
There is also a type of grant called Green Grant. The objective of these kinds of grants is the protection of the environment. If you use the energy-efficient washer and drier and also detergents made with fewer chemicals and more herbal elements, you can try for these grants.
When trying for grants, take the help of a proposal writer, if you are not very conversant with the process of applying for a grant. The local authorities in your city may also help you. The proposal has to be to the point, fulfilling the conditions of the particular grant.
8. Promote your Laundromat Business
If you start your business from home, go for an exhaustive campaign of your service. If possible, go for a door-to-door campaign yourself, so that people will know you and your service.
Find a place where there are several middle-income people or students (hostel or dorm) who will need your laundromat service.
Use social media platforms for the publicity of your laundromat business. Use your Facebook and Instagram accounts to let more people know about your business. Creating a website is a must if you decide to go online.
Try to give some extra benefits to your customers. You can offer the service of pick up and drop the laundry. This will save time and headaches.
You can add the service of wash and fold the laundry. If you have space, offer some refreshments for your customers. Open a small coffee cum snack counter, where the customers can refresh themselves while their laundry is being done.
Make arrangements for debit and credit card payments. This will be extremely beneficial and convenient for customers.
Be very polite and friendly with the customers. As the laundromat business is a service of a personal level, your good behavior will get you more customers.
Give special attention to keep your laundry very clean and dry. Mop the floors, clean the tables and keep the surroundings neat and healthy.
Keep good detergents and after-wash care materials for sale. This will not only increase your profits but also build your reputation.
9. Evaluate the Cost of Starting a Laundry Business
The cost of starting at home will be not much. You just need some basic equipment and cater to your local market. However, opening a commercially viable laundromat business from scratch does require considerable investment.
To start a laundromat business you need a high initial investment. For a small-scale laundromat business, you need an initial investment between $100,000 and $250,000.
You need to spend at least 65% of the gross income for running the laundromat business. This includes the maintenance of the machinery, cost of detergents, etc. cost of power and water.
The income from your laundromat business varies from place to place. It is higher in big cities and lowers in smaller ones. However, on average, you can charge your customer approximately $3 per laundry load.
The average profit margin of your laundromat business may vary between 20-30%. There are cases of loss also. But if you do the maintenance and publicity yourself, you can earn a good profit.
10. Understand the Pros & Cons of Laundromat Business
The laundromat business has a good future for you. With more and more twin-income families, there is no time for laundry. So, people seek the service of laundromats in the neighborhood.
The laundromat industry has got a facelift with good ambiance and pick-up and drop-in services. So, you can expect good business if you can serve well.
People with washers and drier at home also go to the laundromat because of a lack of time and insufficient capacity of their machines to handle the heavy load.
The office dress code has become less formal now. So people need the laundromat more, as their daily office wear does not always need dry cleaning.
Most of the neighborhoods of big cities have many laundries. So opening a new one may not be a good idea.
Sometimes buying an old laundromat may not give profits, because of some old bad reputation of it.
The laundromat business needs a high investment to start with. So, you have to have good planning and strategies before starting the business.
However, the future of the laundromat business seems quite bright. According to Statista, the global home and laundry care revenue of US$81 billion in 2018 is expected to increase to US$88 billion by 2023. Statista further says that the laundry care market is expected to grow annually by 1.5%.
So, according to figures, if you can start from home and get grants you will have a good share of profits in your laundromat business. You need to grow your reputation and learn the details of getting the grant. Take good care to build a good relationship and you will succeed in your laundromat business.
About the Author: 99businessideas.com led by Rupak Chakrabarty is committed to helping beginners, entrepreneurs, and small business owners in starting, managing, and growing their business. Our aim is to educate the entrepreneur on the various stages of entrepreneurship.