Home Forums Laundromats The Secrets OUT!!!

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    I received this mailing from another source that’s positioning itself as a go to for education on acquiring small businesses.

    The point I’m making here is that I never before thought of laundromats as a potential avenue for me. NOW, I’m getting it from all angles!

    Ya baby… coin operated laundromats, that’s what we’re talking about.

    Here’s a breakdown of a deal my gent will run that we may buy. Just another funky business idea for non-correlated cash flow.

    My deal: Buying a Laundromat
    – $67k profit a year
    – Buy w/ $0 of his own cash
    – Use $100k in seller financing (using future sales to pay off owner)
    – Finance Rest w/ Equipment loans

    First Why Laundromats?
    Simple – customers do the majority of the work washing and drying their clothes

    Little labor – means training, on-boarding, and labor is relatively minimal

    Upfront cash – customers pay upfront, makes accounting and tracking easier

    Recession resistant -people always need clean clothes

    Good ROI – laundry industry has a 20-35% ROI and nearly a 95% success rate, according to Speed Queen (eek, not sure on 95% but maybe directionally).

    Inventory. – Unlike a restaurant, convenience store, or grocery store, laundromats have very little physical inventory.

    No Seasonality – Not seasonal or weather-dependent.

    You (or in my case my gent and our operator) have to run a laundromat. 😉

    $200k price tag – BUT I’m going to use seller financing and a small upfront like $20k. Learn more about how to structure deals w/o capital like this —> UA.

    Low barrier to entry – lots of laundromats out there.

    Get Your Hands Dirty. You’re a plumber, electrician, businessman, marketer, janitor, and a million other things all rolled into one. Or you do what I do and give an equity split to an operator to run it for you and you front the cash.

    Set costs keep on rising -utilities and rent don’t go away.

    Customers – This is a unique client set, I have someone else do the coin collection, security, oversight etc. Because well… crackheads.

    Here’s a high level of how the balance sheet looks.

    It’s about the same over the 5 year period I requested, variable from $50-70k.

    They wanted $200k and would finance through seller financing $125k.

    I said, that’s cute. I also want Bloomberg’s balance sheet but sadly he won’t give it to me.
    So, given there are 2.5M businesses for sale and he wants a deal, we are circling around my deal which look like this:

    I negotiate down the price (bc you know world is burning), I give him a small down payment, and structure a deal to do the rest of the payment over three years. Lots of ways to get seller to do this that we talk about at Unconventional Acquisitions, I like structuring them so the seller wins too on the upside. If you want to buy a business you should join our Mastermind. Click that link.

    For this deal, I make about $5,583 a month as the buyer. We got a good multiple of 1.86x. Then, I am at breakeven in 3 months for my initial cash down and my Cash on Cash Return is 268%.

    Read that again. WE’D MAKE IN YEAR 1: 268%.
    Then again because I like to get paid on the closing AND capitalize on the business so I can hire an operator to do all the things I don’t want to do.

    I get an equipment loan potentially for the $135k worth of laundry equipment and an SBA loan (they’ll do 90% of the revenue typically).

    Which gives me $242k AT CLOSING on a laundromat in my bank account.

    Then I start the process to go, find another one, and use those proceeds as the cash down.

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