Laundromat Resource › Forums › Financing › How to increase value? › Reply To: How to increase value?
Hi Darren, As Jordan mentioned the answer is it depends, but the answer is yes too! Ha ha
I have a chain of laundromats in Cincinnati and have refinanced many many times. Sometimes for better terms to improve cash flow, sometimes to repackage new equipment and sometimes as a cash out in order to acquire or build a new location. This is why I say “it depends”.
It’s all based on how leveraged you are. Most lenders are going to give you a multiple of your net profits as a fair valuation. That multiple will typically be in a range of 2X to 6X. I’ve never did a strictly cash out refi for no reason but I imagine they’d balk at that but they will almost always do a cash out refi if you have equity AND you’re reinvesting the proceeds. I agree with Jordan that Alliance financing, Eastern Funding and a community bank or credit union are you best options. I’ve done loans through them all.
Regarding adding value there are almost unlimited ways to add value to your mat for a customer. Keeping your stores super clean, being attended, having in store vending, having A/C, extra wide aisles, large folding tables, a plethora of seating, rockstar attendants and management, drop-off laundry services, free WiFi, an ATM, credit card pay at the machines, games and coin pushers, TV’s, convenient hours, kids play area with books and a kids TV, modern facilities, an out of this world restroom, etc etc etc. I could go on and on. I hope this helps you out. Please check out my videos at “Laundromat Millionaire” on YouTube too. Best wishes to you