Do you want to start a laundry and dry cleaning service business with small capital? In this post, I have provided a step-by-step guide on how to start a laundry and dry cleaning service business.
The laundry and dry cleaning business can be started in many different ways. You can open a grand store or can start from the home location with a doorstep delivery service. Also, you can start with a franchisee of a reputed brand. It demands a very small amount of capital investment. However, opening your own brand creates an opportunity of offering franchises to enhance the profitability of the business.
Laundry with a dry cleaning service is evergreen and recession-proof business globally. As per a recent report from Statista, the revenue from dry cleaning and laundry services (except coin-operated)only from the USA only is expected to be around 7,660 million U.S. dollars by 2022.
Laundry & Dry Cleaning Service Business Plan – 10 Steps to Follow
1. Study The Market
Laundry and dry cleaning are localized businesses. Your target demographic is the local people. So study the market first. Try to collect data about the population of your area. Check how many dry cleaning businesses are already there.
Figure out the residential and commercial statistics. Therefore, these all will help you in writing a business plan and starting the business accordingly.
2. Gain The Expertise
Do you have previous experience in this field? If not, it is advisable to have some experience. Furthermore, you can try working in an existing dry cleaning shop for a few months to a year. This is hugely beneficial for a new entrepreneur or beginner. It will help you in getting knowledge about the equipment, their usage, customer service, and also several operational aspects.
However, you can also get knowledge from different books available in the market.
3. Create a Business Plan
This is the most important part of your business. First of all, plan your business model. Accordingly, you can determine the input costs. Set your business goal and plan to reach it there. According to the ownership pattern, determine the form of your organization. Determine what are services you will going to offer.
Draft a clear marketing and sales promotion strategy. How you will go to compete with other laundry services. If there is a need for funding, draft a funding request for the investors. Calculate your startup budget. Draft financial projection with cash flow and ROI.
4. Secure Funding
According to the plan, you need to arrange finance. You can borrow cash from friends and relatives. in addition, you can apply to a bank for a loan. Angel investment is also a very good option for this type of business. However, you can also accept equity capital investment by having business partners.
Related: How To Raise Small Business Capital From Investors
5. Obtain Registration & License
Registering your dry cleaning business is most essential if you are planning to run a legally compliant company. It is advisable to talk to a local attorney or business consultant. It hugely depends on the area where you want to start the business. Check the labor law of your state or province.
In addition, check the insurance available especially for this type of business. In conclusion, it is important to do the necessary paperwork and get the license in hand to operate the business.
6. Dry Cleaning Business Location
According to your business model, you must have a business location. If you want only delivery service, then you can operate from a small space in any location. Even you can start at home. Otherwise, you must have a good store location. Try to position it near locations that use your services. It includes office areas and high-value residential areas.
7. Procure Equipment
You must gather equipment for laundry and dry cleaning service. Remember, there is a difference between laundry and dry cleaning. Laundry involves washing clothes using water and detergent while dry cleaning is cleaning clothes using chemicals (no water). You can purchase new machines or you can hire those.
You can also purchase a second-hand machine for cost-cutting. However, new machines are long-lasting and demand less maintenance cost. Ask the machine supplier for on-site training. Check the warranty period and customer service review before placing the final order.
8. Recruiting Manpower
This is a labor-intensive business. You must hire employees from different sectors. However, it is advisable to prepare an HR manual with employment planning and structure. You must hire employees for washing, store management, delivery, and accounting purpose.
9. Fix The Pricing
You will need to offer competitive pricing. In this business, different products attract different price tags. There are a lot of things you can offer for washing. Such as clothing, suits, specialty or designer clothing, furnishing including carpets and bed linens. Fix a product-wise pricing chart.
10. Promote Your Business
- Promote the business locally both offline and online.
- Local newspaper advertising is a great way to aware of local people.
- Try low-cost ways to promote your dry cleaning business. Make your service available in popular local directories.
- Use social media wisely. You can offer coupons or promo codes there.
- Offer home pickup and delivery service.
- Get the clothes ready before the deadline, this is crucial.
- Have your own website. This is important nowadays.
- Use delivery bags and tags as promotional tools.
If you want to launch your laundry and dry cleaning business, we recommend you to read the book ‘Ultimate Cleaning Business Package.’ The package is a proven system you can use to build a cleaning business that grows month after month on Auto-Pilot. The author of this book Joe has shared a very detailed guide that shows you step-by-step how to start a cleaning business quickly, easily, and make money from day one!
Frequently Asked Questions
How much does it cost to start a dry cleaning business?
The amount of investment to start a dry cleaning laundry business will largely depend on the business model, location, and scale of operation. For example, if you are planning to open a full-fledged storefront in the United States, the cost will be around $250,000 to $2 million. However, for launching on a smaller scale or mobile basis, the investment will be lower in the range of $50,000 to $100,000.
How profitable is a dry cleaning business?
As per industry experts, the dry cleaning industry across the world is expected to grow. However, the profitability will depend on the location and quality of services. In the United States, a small dry-cleaning storefront owner makes a profit of $40,000 yearly on average after deducting all expenses.
This business is all about customer satisfaction. More satisfying customers ensure more new and repeat orders. Never get caught arguing with your customer. Try to know the client’s preference for the service. And try to apply them. If you are starting with a shoestring budget, don’t go for a wide range of services. Rather, offer niche services like only leather or only carpet, etc., and start a home-based dry cleaning service.
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.