How Much Does It Cost to Start a Laundromat Business?

Do you want to know exactly how much it cost to start a laundromat? If YES, here is a detailed cost analysis for starting a laundromat and raising finance.

As the name implies, a self-service laundry or coin wash/laundry or laundromat is a laundry facility where people come in to personally wash and dry their clothes. Technically, customers provide their own labour and still pay for making use of the laundry equipment available.

The cost analysis as it relates to starting a standard laundromat business in the united states of America, Canada, United Kingdom, and Australia can be said to be almost the same except for few variations.

For example, the cost of setting up a full-service state of the art laundromat facility which has the following; self-service washing machines, clothes dryer/drying machines, industrial pressing iron, ironing boards, sewer connection, cleaning supplies, soap, detergents/washing powder, bleach, starch/adhesive, laundry bags et al are the same especially when bench–marked against the US Dollars.

For instance, if you live in the united kingdom and you decide to import industrial washing machines, industrial pressing irons, cloth dryers and other equipment from Japan, you will pay same price for these machines no matter the part of the world you live in, the only variation will be the cost of shipping the goods to your destination.

Other factors that may be slightly different in terms of costing when it comes to starting a standard laundromat business in any of the countries listed above are cost of labor, cost of transportation and logistics, local tax, insurance policies, business incorporation fee, rent/leasing amongst other factors.

Over and above, when it comes to starting a medium scale laundromat company, you should be prepared to either rent or lease a standard and centralized facility with good human and vehicular traffic; this is going to be one of the areas where you are expected to spend the bulk of your start–up capital.

How Much Does It Cost to Open a Laundromat?

These are the key expenses you are expected to make when starting a medium scale but standard laundromat company business in the United States of America;

1. The total fee for registering the business in the United States of America – $750.
2. Legal expenses for obtaining licenses and permits (Health department license and business license) and permits (Fire department permit, Air and water pollution control permit, and Sign permit et al) as well as accounting services (CRM software, Payroll software, P.O.S machines and other software) – $15,300.
3. Marketing promotion expenses for the grand opening of the laundromat company in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
4. The cost for hiring a business consultant (including writing business plan) – $2,500.
5. The cost for insurance (general liability, theft, workers’ compensation and property casualty) coverage at a total premium – $30,400.
6. The cost for leasing a standard facility in a good and centralized location – $250,000
7. The cost for remodeling the facility – $100,000.
8. Other start-up expenses including stationery ($500), phone and utility (gas, sewer, water and electric) deposits ($6,500).
9. The operational cost for the first 3 months (salaries of employees, payments of bills et al) – $60,000
10. The cost for start-up inventory and laundry machines and equipment (washing machines, dryers, industrial pressing irons, ironing board, washer hook-up fees (sewer connection), cleaning supplies, soap, detergents/washing powder, bleach, starch/adhesive, laundry bags, invoices for wash-and-fold, bathroom supplies, racks, hooks/hangers et al) – $350,000
11. The cost for store equipment (cash register, security, ventilation, signage) – $13,750
12. The cost for the purchase of furniture and gadgets (Telephone, printing machines, computers, tables and chairs et al): $14,000.
13. The cost for building and hosting a website: $600
14. The cost for opening party: $8,000
15. Miscellaneous: $10,000

You will need an estimate of nine hundred and fifty thousand dollars ($950,000) to successfully set up a medium scale but standard laundromat company in the United States of America. Please note that this amount includes the salaries of all the staff for the first 3 months of operation and a business with more than one outlet in key locations within same city.

When it comes to starting a standard laundromat company business on a large scale, you would need the services of the following professionals;

• Manager (Owner)
• Human Resources and Admin Manager
• Accountant/Cashier
• Merchandize Manager
• Marketing and Sales Executive
• Laundromat Attendant
• Cleaners
• Security Guard

Starting a small scale but standard laundromat company business that can only service a handful of clients per–time in just one location in the United States of America will cost about two hundred and fifty thousand dollars to five hundred thousand dollars ($250,000 to $500,000).

When it comes to starting a standard and large-scale laundromat company with several outlets in key cities in the United States of America, a laundromat company that can accommodate over twenty clients per-time and a company with the intention of selling franchise and also offering complimentary services, then you should look towards budgeting well over two million, five hundred thousand dollars ($2.5 million).

Factors That Can Influence the Cost of Opening a Laundromat

1. Location of the Laundromat

The location you choose to open your laundromat is a critical factor that will influence the cost of opening the laundromat. For example, if you choose to rent or lease a facility for your laundromat in a city center, then you should be ready to spend more than someone who chooses to rent or lease a property off the city center.

The bottom line is that the choice you settle for to open your laundromat will determine the amount you will spend on rent or lease, the amount you will spend in promoting the business, the amount you will spend on licenses and permits, utilities, and acquiring your cleaning and other supplies needed to operate a laundromat business.

2. The Size and Layout of the Laundromat

Another major fact that can influence the overall cost of opening a laundromat is the size and layout of the laundromat. As expected, the larger the laundromat business, the higher the cost required to start the business, and the smaller the laundromat, the lower the cost required to start the business.

For example, a larger laundromat space will require more equipment, furnishings, and utilities, which can increase the initial investment.

3. The Cost of Purchasing Laundromat Equipment and Machinery

The cost of purchasing laundromat equipment and machinery is yet another major factor that can influence the overall cost of opening a laundromat. Please note that the cost of laundromat equipment, such as washers, dryers, folding tables, and vending machines, can be much and they have the capacity to impact significantly the overall cost of opening a laundromat business.

In essence, the number of laundromat equipment, and machinery you want to equip your laundromat with, and of course the brand and type of equipment, and machinery you settle for will to a large extent determine the overall cost of opening your laundromat business.

5. The Cost of Renovations and Construction

No matter the facility you rent, lease or acquire for your laundromat, you are expected to budget part of your startup capital for renovations. The only reason you will not need renovations and construction is only when you purchase an already existing laundromat business.

However, most facilities that are put up for rent or lease for a laundromat usually require renovations or construction work to meet the needs of a laundromat, such as plumbing, electrical, or interior modifications, and trust me, these costs can be significant.

Please note that renovations can range from minor cosmetic changes to major overhauls, depending on the condition of the space that you rent for your laundromat.

6. The Cost for Obtaining the Required Permits and Licenses

Another major factor that can influence the overall cost of opening a laundromat is the cost of obtaining the required permits and licenses, such as business licenses, zoning permits, and plumbing permits. Without obtaining these needed permits and licenses, you may not be allowed to operate your laundromat.

Trust me, the cost of obtaining these permits, and licenses can vary significantly depending on the local regulations and they can also impact the overall cost of opening your laundromat.

7. The Cost of Marketing and Branding the Laundromat

No one starts a business without making provisions for marketing and branding the business. If you don’t invest in marketing and branding your business, you may struggle to generate income for the business.

In essence, if you are planning to open a laundromat, then you must make a budget for marketing and branding the laundromat. As expected, promoting the laundromat and creating a recognizable brand may require investment in marketing materials, signage, website development, and advertising campaigns.

These costs no doubt can be significant, and they have the capacity to influence the overall cost of opening a laundromat business.

8. The Cost of Insurance and Legal Fees

Another major factor that will influence the overall cost of opening a laundromat business is the cost of insurance and legal fees. As expected, you cannot legally open a laundromat in the United States of America if you don’t have the required insurance policy coverage for such a business.

You may need insurance covers such as property insurance, general liability insurance, business interruption insurance, workers’ compensation insurance, commercial auto insurance, equipment breakdown insurance, and cyber liability insurance.

Please note that the cost of insurance can vary depending on factors such as location, size, and coverage options. You should also make provision for legal fees because you will need them during the setup process.

9. Miscellaneous Expenses

Lastly, another factor that will influence the overall cost of opening a laundromat business is the budget you have for miscellaneous expenses. Miscellaneous expenses refer to various small or unclassified expenses that do not fit into specific categories or have a dedicated budget line.

These expenses are typically incidental or miscellaneous in nature and do not fall under major expense categories like rent, utilities, salaries, or inventory. When it comes to starting a standard laundromat company business on a large scale, you would need the services of the following professionals;

• Manager (Owner)
• Human Resources and Admin Manager
• Accountant/Cashier
• Merchandize Manager
• Marketing and Sales Executive
• Laundromat Attendant
• Cleaners
• Security Guard

So as expected, if you want to open a laundromat, then you should budget for miscellaneous expenses, such as signage, security systems, coin change machines, furniture, and décor et al. Trust me, these smaller or unclassified expenses can to a large extent influence the overall cost of opening your laundromat business.

How Much Does It Cost to Buy a Laundromat Franchise?

In the United States of America, the Average Cost of Purchasing a Laundromat Franchise is $50,000. Examples of 3 Well – Known Laundromat Franchising Companies in the United States of America are;

• Maytag® Commercial Laundry – Franchising Company
• Mac-Gray Laundromat – Franchising Company
• Super Laundry Laundromat

In conclusion,

It is important to note that the factors discussed in this article are some of the major factors that can influence the overall cost of opening a laundromat, but there are other factors that are not listed in this article that can also influence the overall cost of starting a laundromat business.