March 16, 2021 at 7:04 pm #4704CKHParticipant
I realize this is a ridiculous question, but I wanted to get your attention! For real though: as a beginner, I’d like to get a realistic feel for the average cost of different types of laundromat purchases. Let’s hear what it costs to start a big, brand new facility in a major metro, to buy an old run-down facility in a mid-sized west coast metro, and the cost to open a new facility in a small town in the south. After listening to hours upon hours of podcasts in a very short time, I’ve realized that I still have no idea what to even expect when shopping around. There was a listing in the very outskirts of my metro for $100k recently. I heard one podcast interviewee say he bought a run-down laundry for $2500! Then the commercial lender got on and made it sound like most laundromats cost about $200k, which was depressing to me. So, what’s your experience? What type of laundromat have you bought, and what did it cost?
March 20, 2021 at 7:39 am #4728Sherrie MyersParticipant
Hi CKH, In my research figure a Laundry will cost between 200K on the low side and 1 Million on the high side.
You basically have these considerations.
(1) physical location
Existing laundry building with the infrastructure – or build a laundry ( building and/or infrastructure).
Buy commercial property or lease commercial property.
Less expensive is an leasing a existing laundry.
(2) The Business
The laundry “business” is the current customer base, never the projected customer base or the possible customer base. Is there an existing customer base? Who, what, where and how much money does that customer base bring to the laundry now? The value of that customer base is the “business” you will buy.
Least expensive is a closed laundry, you are not buying the “business.” No money for no customer base. But you need to do your research, why is it closed? Can you recapture a customer base?
Then you have equipment – Is the equipment working?, How old is it? How much does it cost to keep it running – or are you going to have to replace everything?
How much does a Laundromat Cost?
If you get a “FREE” Laundry that means there is NO customer base, and most likely no equipment or equipment that needs a complete replacement ” complete re-tool” and significant TI (tenant improvement). You will also
still either need to buy the building or negotiate a lease. That is not FREE
Then there is the cost of repair or replacement of equipment and TI also not FREE.
The least expensive entry into a Laundry would be
A currently opened laundry that is not well run, but has a reasonable customer base and equipment that is not past it’s functional life expectancy and a reasonable amount of time on a lease. You are sure you can take this underperforming business and turn it around. Are you sure??? Each situation takes careful evaluation that is why the cost varies so much.
March 21, 2021 at 7:29 am #4763Jason DodgeParticipant
Anywhere from zero to over $1,000,000. You could take over a lease of a closed down location which isn’t super common in some areas. But you would most likely have to retool the store and that could be costly. It is possible to buy on the cheap but those locations need work. If the real estate is included then it will be on the higher side.
There is a location being built in Chicago right now, the building alone was over $2,000,000. This will be a massive location though.
March 27, 2021 at 4:17 pm #4897Chris StarkParticipant
I had a local distributor tell me that he hasn’t seen a “free” laundromat deal in Northern GA since 2015. The prices I have seen range from $96k to $698k. I made the rounds with all of the distributors and have zeroed in on one that I will use to help me find the right location based on demographics and price point.
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