Laundromat Business Overview

A laundromat provides self-service washing and drying machines for public use. Most laundromats serve residential areas where many homes and apartments lack washing machines, making them a necessity for local communities.

These facilities typically operate 7 days a week, often 24 hours a day, allowing customers to do laundry at their convenience. The size of laundromats varies significantly, from small neighborhood stores with 20-30 machines to large facilities housing over 100 washers and dryers. While some owners choose to staff their facilities during peak hours, many operate successfully with limited personnel, using security cameras and remote monitoring systems.

The most common business models include:

• Full-Service Facility: A staffed location with multiple washers and dryers, offering additional amenities like folding stations, detergent sales, and waiting areas
• Unstaffed Self-Service: An automated facility operating primarily through coin or card-operated machines with minimal overhead costs
• Hybrid Operation: A combination of self-service machines and attended services like wash-and-fold or dry cleaning

Related: Checklist To Start A Business

How Do Laundromats Make Money?

The primary source of income for laundromats comes from customers paying to use washing and drying machines. Customers insert coins, cards, or mobile payments to operate the equipment, with prices varying based on load size and wash cycle type.

Additional revenue sources that laundromats might incorporate include:

• Vending Services: Sales of laundry supplies, fabric softener, dryer sheets, and snacks/beverages through on-site vending machines
• Drop-off Services: Professional wash, dry, and fold services for customers who prefer having their laundry done by staff
• Commercial Accounts: Contracts with businesses like hotels, restaurants, or small bed-and-breakfasts to handle their linens and towels
• Additional Equipment: Income from specialty machines for oversized items or delicate garments

Industry Statistics

Laundromats fall under NAICS code 812310, representing coin-operated laundries and dry cleaning operations. Here are some statistics that show what’s happening in this industry.

Laundromat Industry Size & Growth: Laundromats generated $6.7 billion in revenue last year. The industry has shown modest gains, with an average annual growth rate of 0.9% over the past five years. Over the next five years, revenue is expected to decline due to increased homeownership rates and more rental properties, including in-unit laundry facilities. (IBISWorld)

Number of Laundromats: There are 17,139 laundromats operating across various communities. The number of businesses has decreased by an average of 2.2% annually over the last five years. CSC Serviceworks stands as the largest operator, but the industry remains largely made up of independent owners running single locations. (IBISWorld)

Laundromat Profit Margin: After accounting for operating expenses, businesses maintain profit margins between 11% and 20%. Machine maintenance, utilities, and labor costs impact overall profitability. (IRS)

Also See: Ideas for Naming a Laundromat

Costs To Start a Laundromat

Starting a laundromat typically costs between $200,000 and $500,000. These expenses will depend on factors like location size, equipment quality, and whether you’re buying an existing business or starting from scratch.

There are several expenses when opening a laundromat, but here are some of the biggest costs to plan for:

Commercial Space & Building Improvements: Leasing or purchasing a retail space costs between $100,000 and $200,000. The space needs proper electrical, plumbing, and ventilation systems to support multiple washing machines and dryers. Most locations also require renovations to create an open floor plan, install proper drainage, and add folding areas.

Equipment: Commercial washers and dryers cost between $75,000 and $150,000. This includes a mix of machines of different sizes to accommodate various customer needs. Card readers or coin mechanisms for each machine add to the equipment costs.

Utility Deposits: Initial deposits for water, electricity, and gas services often total $15,000 to $25,000. Laundromats use significant amounts of utilities, so providers generally require substantial deposits before starting service.

Security Systems: Installing cameras, lighting, and monitoring equipment costs $5,000 to $10,000. Many laundromats operate 24 hours a day, making security features necessary to protect equipment and customers.

These figures represent rough estimates, and actual startup costs will vary based on location and business size.

Resources:
Coin Laundry Association