Dry Cleaning Business Overview

A dry cleaning business offers specialized laundry services for clothing and textiles that cannot be traditionally washed at home. These establishments serve both individual and commercial clients, offering professional cleaning for clothing, bedding, draperies, and other fabric items requiring careful handling. To maintain quality service standards, a dry cleaner must understand different fabric materials, stain removal techniques, and proper handling of delicate items.

The most common business models in the dry cleaning industry include:

• Full-Service Retail Location: Operates a storefront where customers drop off and pick up items, with on-site cleaning. Most dry cleaners operate in retail locations within neighborhoods or shopping centers, making them easily accessible to customers.
• Drop-Off Location: Functions as a customer service point that sends items to a central cleaning facility.
• Delivery Service: Picks up and delivers items directly to customers’ homes or offices, partnering with a cleaning facility.
• Commercial Service Provider: Primarily serves businesses like hotels, restaurants, and uniform companies.

Related: Checklist To Start A Business

How Do Dry Cleaners Make Money?

Dry cleaners earn their primary revenue through per-item pricing for cleaning services. Each garment or textile item has a price point based on the required cleaning process. Formal wear, like suits and dresses, typically generates more revenue per item than casual clothing.

Many dry cleaners also implement minimum order amounts to ensure profitable operations. Commercial accounts often receive volume-based pricing, which can provide steady income through regular service agreements.

Additional revenue sources for dry cleaning businesses include:

• Wash and fold laundry service: Regular washing and pressing of everyday garments that don’t require dry cleaning
• Alterations and repairs: Basic garment fixes like hemming pants, replacing buttons, or fixing seams
• Specialty item cleaning: Premium charges for wedding dresses, leather items, or delicate fabrics that need extra care
• Textile preservation: Long-term storage and preservation of valuable items like wedding dresses or vintage clothing
• Pick-up and delivery fees: Additional charges for convenience services that bring items directly to customers

Industry Statistics

Dry cleaning businesses fall under NAICS code 812320 – Drycleaning and Laundry Services. This industry classification covers establishments providing dry cleaning and laundering services, including specialty cleaning for garments and textiles. A few industry statistics for the dry cleaning industry include:

Dry Cleaning Industry Size & Growth: The dry cleaning industry generates $8.3 billion in annual revenue. Over the past five years, the industry experienced an average annual decline of 4.9%. Growth projections indicate potential expansion over the next five years as consumer spending patterns stabilize and demand for professional clothing care services rebounds. (IBISWorld)

Number of Dry Cleaners: There are 25,105 dry cleaning businesses operating across the country. The industry remains highly fragmented, with no single company controlling more than 1% of the market share. Most establishments are independently owned and operated local businesses serving their immediate communities. The number of businesses has decreased by 4.0% annually over the past five years. (IBISWorld)

Dry Cleaners Profit Margin: Dry cleaning businesses typically maintain gross profit margins between 45% and 55%, while net profit margins have a 7.6% average after accounting for operating expenses, labor costs, and equipment maintenance. (IRS)

States with Most Dry Cleaners: The highest concentration of dry cleaning businesses is found in densely populated urban and suburban areas, particularly in regions with large professional workforce populations. New York, California, Texas, Florida, and Illinois have the largest number of dry cleaning establishments. These locations correlate strongly with population density and areas with high office worker concentrations. (U.S. Census Bureau)

Costs To Start a Dry Cleaning Business

Starting a dry cleaning business typically requires between $200,000 to $500,000. This includes equipment, location setup, and initial inventory of supplies. The cost varies based on location size and whether purchasing new or used equipment.

Here are some of the more expensive items needed when starting a dry cleaning business:

Commercial Dry Cleaning Equipment: A complete set of dry cleaning machines, including the main dry cleaning unit, pressing equipment, and finishing stations, range from $100,000 to $250,000. This includes washers, dryers, pressing machines, and spotting boards.

Location and Build-Out: Securing and preparing a retail location costs between $50,000 and $150,000. This covers lease deposits, plumbing installation, electrical work, and ventilation systems needed for the cleaning equipment.

Solvent and Chemical Systems: The initial setup of solvent recycling systems and purchasing cleaning chemicals costs between $15,000 and $30,000. This includes storage tanks, filtration systems, and an initial supply of cleaning solvents.

Point of Sale and Management Systems: Computer systems, tracking software, and tagging equipment typically cost between $5,000 and $15,000. These help manage customer orders, inventory, and payment processing.

These estimates represent general ranges, and actual costs will vary. Additional expenses may include utilities deposits, initial supplies, and employee training.

Resources:

American Drycleaner
Cleaner and Launderer
Drycleaning and Laundry Institute International