Why Owning A Laundromat Is a Great Business Decision

When it comes to finding a new business avenue or side hustle that can serve you well and is recession-proof, there is one avenue that has proven to be in high demand throughout the years and remains a stable and secure option for any entrepreneur to consider. This is the laundromat sector, a sector that has demonstrated resilience and stability even in the face of economic downturns.

Doing laundry is a basic need in life, and everyone needs clean clothes. However, not everyone can afford to purchase laundry equipment for their home or is allowed to have one within their living accommodation. And this is where laundromats come into play. Being there to provide this service for people is not only something that will always be required but is a genuine way to make money, and with relatively low operating costs past the initial purchase cost of machines and equipment. And with profit margins on average around the 20 to 35% mark, it’s little wonder why people are adding this to their business portfolio or considering it a genuine side hustle or main business.

Let's take a look at some of the pros of owning a laundromat.

Inefficient Market

Essentially, what this means is there are very few laundromat chains across the nation, and many are run locally; most owners don't have more than one or two sites where they run operations, which allows entrepreneurs to swoop in and find some great opportunities to stand out and make their venture more lucrative by offering services and features others don't. 

Flexible

It is not just the washing and drying of clothing you can make money from in a laundrette. You can build up the business by offering a variety of add-on services, expanding your business, and exciting your customers. This can include the addition of laundry vending machines that offer customers the opportunity to purchase their supplies on-site, generating an additional profit for you. You can add food and drink vending machines for refreshments while they wait. You can also offer Wi-Fi, which customers need to pay for. Additionally, consider offering services such as express cleaning, dry cleaning, ironing, and even pickup and delivery services to complement your laundromat, thereby increasing profitability and customer satisfaction.

Tax Advantages

It is always important to consult with an accountant when operating a business to receive the right advice tailored to your specific needs. However, there are certain tax breaks and incentives that you might be eligible for when running a laundromat. One such option is via the depreciation of the machines and equipment year on year; you don't pay tax on depreciating amounts each year, meaning the tax you pay will reduce each year as the equipment ages. You might even be able to pay tax after deductions, meaning you reduce the number of profits you pay tax on; always get expert advice to ensure you do not commit tax fraud, as these scenarios wouldn’t be applicable to everyone. This financial advantage can significantly impact your bottom line and make your business more profitable.

Laundromats are Cash Businesses

When people come in to wash and dry their clothes, they expect to pay upfront to use the services and equipment. They are often self-serve, which means you don't have to chase customers for payments, leaving you out of pocket or running into cash flow issues. You have improved cash flow and income compared to other businesses. If you don't accept payment after the service, i.e., if you add services such as delivery or ironing options and require upfront payment, you have what you need immediately and prior to taking on the work.