Q. WHAT IS A GOOD LOCATION?
The best locations in Southern California are found in high-density, low-to-medium income areas with a good concentration of multi-family apartment buildings. The Laundromat should be located in sites with adequate parking. Laundromats may also do well in middle-to-high income areas with abundant single-family homes, since many two-income families now share the washing and drying experience.
Q. HOW IS THE TERM "TIMES MONTHLY" NET AND GROSS USED?
Laundromats are often marketed at prices that reflect a multiple of monthly net and gross income figures. In the past, the rule of thumb for calculating the value of Laundromat was to multiply the monthly gross times twenty or twenty-five. Because of the current variations in rent, CAM charges, utility expenses and repair costs, the brokers of Laundromats now use the net income, with allowances for hired cleaning and repair labor (but not any note payments)times a multiple that ranges from a low of forty to a high of seventy based on remaining lease term, age and condition of equipment.
Q. WHERE DO I GET FINANCING?
Financing is available from a variety of sources. Financing is seldom quick and easy, but working with a variety of financing specialists it is usually obtainable. If you have a good credit history, approval is normally within thirty days. Sometimes it is necessary to secure your first Laundromat investment with real estate as partial security. SBA loans are also available on existing locations with a verifiable history of profits. Banks look at credit history, down payment, previous profits, alternate means of repayment and experience of the buyer in the business.
Q. SHOULD I BUY A NEW OR USED LAUNDROMAT?
Without question you should buy a new store if you have the financial capability and a location is available near your home or business. A new store allows you to learn without the strain of keeping up with repairs, which is higher on the used stores. It also should contains the latest in energy saving equipment. Utility savings can be considerable in new stores compared to older existing Laundromat locations. Consider using the new Super High Speed washers for energy savings.
Q. HOW DO I GO ABOUT BUYING A NEW LAUNDROMAT?
There are several companies in Southern California with an ongoing program to develop new Laundromat sites. You also have the option of finding your own Laundromat location and finding a distributor of laundry equipment to supply you with equipment, evaluation of your location, frank advice on whether you should pursue it as a location and assistance in negotiating of a lease with industry specific terms. Larry Larsen, Realtor® and Laundromat123 are available for consultation, development issues and a review of potential purchases of all potential new Laundromat locations.
Q. WHAT IS THE PROCESS OF BUILDING A NEW LAUNDROMAT?
A Laundromat professional is normally used to survey your location, recommend a mix of equipment, and design your Laundromat. After your approval of the basic design, an architect will create a complete set of Laundromat plans for submission to the appropriate building department. Construction will then start with the delivery of necessary gas, water, sewer and electrical service to the site followed by installation of the equipment and other tenant improvements. Approximately six months after your decision to purchase a new Laundromat has been made, you'll be ready for your Grand Opening.
Q. HOW CAN I GET LAUNDROMAT CONSTRUCTION DONE RIGHT?
Don’t try to do it on your own. Mistakes have to be lived with for the life of the investment. Select someone who has a history of construction of Laundromats that can be with you every step of the way. It is easy to leave out necessary items, use poor layouts and select inappropriate materials. Experience is required if you want a quality Laundromat built for the lowest possible investment.
Q. WHERE SHOULD A LAUNDROMAT BE LOCATED?
A steady flow of customer traffic is essential to a good location. Prime sites, a recent industry study reported, are found in and around large shopping centers, neighborhood business districts with freestanding stores, and strip centers (a row of stores with off-street parking spaces). Sites near food markets, car washes, mini-markets and fast-food restaurants are also considered good locations.
SHOULD YOU BUILD OR BUY? BASICS