On the road toward a new laundromat? Starting a new company is so much more than finding a few machines and opening your doors, and if you want customers to start pouring in, you’ll need to do it right.
Thankfully, there are a number of valuable resources out there for prospective business owners. As you begin to forge your own path, here are four tips that will guide you on your way toward financing a new laundromat:
1. Find the best location
The first step is to find the perfect location for a laundromat. While this does include the right type of storefront, including size and features, it goes beyond that. It also means finding a business location that is prime real estate for laundromats.
The best locations are ones near compatible businesses or consumers, such as:
- Apartments and homes – A laundromat right next to an apartment complex is in a perfect location for a maximum number of customers.
- Retail – Laundromats in high-trafficked retail areas are also in a good spot, thanks to the customers that frequent supermarkets, mechanics, check cashers and other stores.
2. Get a good lease
The second step is to get that perfect lease for your laundromat. While location is important, the wrong lease on that building could leave you in a bind down the road. Elements of a quality lease include:
- Favorable terms – The longer the better when it comes to leases. The industry standard is a 10-year lease with one five-year option.
- Rent – You don’t want to pay too much for your space. Try to lock down a rate that is between 10 percent and 20 percent of your projected gross revenue.
- Parking – If possible, make sure you have dedicated parking spaces for your laundromat.
- Sublease – You want the ability to sublease, as this flexibility grants you more options in the future.
3. The right guidance
Your laundromat will form many partnerships over the years. The right ones will make all the difference. For example, you want a vendor who doesn’t just sell, but helps you analyze your business, identify the best products and services and stays involved through implementation. Most importantly, form a trusted network of professionals you can lean on as you get your business off the ground.
With these three steps complete, you are ready to pursue financing for your laundromat. This is when your credit history comes into play – you don’t need perfect credit, but you do need good credit. Check your credit history and resolve any outstanding debts or errors. Then, gather your business’ history and information, as well as your experience and net worth. These will all come into play when financing your new laundry venture.
Creating a new business opportunity is an exciting proposition, and it requires the right steps beforehand. Follow these four, and you’ll be well on your way toward getting your laundromat off the ground.