How to Start a Laundromat Business

Laundromats are extremely common all over the world. They are convenient and easy to use, and they make life so much simpler for people who don’t have the space for a washing machine in their homes. Often, you might find people with larger families use a laundromat so that they can get a bigger amount of laundry done in a single day, rather than spending endless hours washing clothes and drying them in smaller batches. 

On the other hand, a laundromat might also sell clothes washing paraphernalia, like detergent and washing soap or dryer sheets, for people who might run out of these things and don’t want to go to the grocery store to buy them. 

10 Easy Steps to Start a Laundromat Business

Start a Laundromat Business
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Laundromats are cheap and convenient.  If you’ve wanted to learn more about how to start your own laundromat, here you go! We’ve put together this helpful guide taking you through the various steps of opening a laundromat business. 

STEP 1: Make Laundromat Business Plan

Make Laundromat Business Plan
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You’ve come up with the idea to start your own laundromat business, but you’re not sure about the logistics of setting it up. The first thing you need to do is to make a business plan. It’s essential to make sure that you’ve planned everything out properly, from setting up your business to making sure it is legally registered. 

A well-planned business means that you have planned out the specifics of how you want to run it, how much money you need to keep it running while also making sure that you’ve planned for any unforeseen expenses or emergencies that may come up. 

In your business plan, make sure that you have a summary of what your business does, a clear description of your idea for the laundry business, and any ideas you may have for future growth. You must also figure out how you plan to market your laundromat, how many people you either plan to hire or who are already on board, and finally, what your financial situation is.  

How Much Does it Cost to Start a Laundromat?

In terms of the cost for your business, you’re going to need a significantly large amount of money to get your laundromat started. You will need anywhere between $200,000 to $450,000 to start a laundromat

What are the Ongoing Expenses for a Laundromat Business?

Just like with any business that you start on your own, you will pay a large amount of money for utility costs and maintenance of your washing machines and dryers. It could cost anywhere between $200 to $1900 for your utilities and over $100 per machine for maintenance costs. 

Recognize your Target Market

Like in any other business, you need to figure out who your customers are and your target market. To make sure that your laundromat lasts for several years, you would need to try and target customers who will stick around and use your service for a long time. For example, if you choose to locate your laundromat in a college town with lots of students living in dormitories or shared apartments with no washers and dryers, you will have a steady stream of clients all year round. 

How Does a Laundromat Make Money?

A laundromat makes money in different ways. For instance, you could have the option of letting customers do their laundry by inserting coins into the washing machine and dryer, or you could hire employees to wash your customers’ laundry for them. You could have a card machine or ask them to pay in cash in terms of collecting money. As there is an ongoing pandemic, you could also consider a cashless option and ask your customers to scan a QR code before or after using your laundromat. 

How Much Can you Charge Customers?

The answer to this question depends on where you choose to locate your laundromat. If you’re located in a college town where students don’t have a lot of money to spend, you will not get customers if you charge them more than $5. On average, we’d recommend that you charge no more than $3-6 per person. 

Know How Much Profit Can a Laundromat Business Makes

A successful laundromat can earn over 10-20% in profits per year, depending on the number of customers and the location of the business. However, it’s important to note that if you’re renting the building that your laundromat is in, you might not be able to make any profit in the first few years of the business, but you might break even instead. 

How Can You Grow Your Business?

Once you’ve established your business as a good laundromat with working facilities, you can start to grow your business by investing in a second location in a different part of the town or city your business is located in. If you’re not in a financial position to open a second laundromat, you could consider hosting a monthly special event, such as a Fresh Laundry day, where every customer can come in and do laundry for free. This encourages more people to come and visit your business, and as a result, you will gain more customers. 

You can also market your business on social media and create a Facebook or Instagram page to attract customers. 

Find a Name for Your Business

Picking a good name for your business can be challenging, but it’s crucial to brand your laundromat well so that customers know who you are and what services you offer as soon as they hear your name. Make sure that the name you choose indicates who you are, and make sure that no other laundromat business has the same name as your business. 

STEP 2: Form a Legal Entity

Form a Legal Entity
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There are various business structures to choose from, so you need to decide where you want to start a partnership with someone and split the profits or whether you want sole ownership over your laundry business. Suppose you choose to establish your laundromat as an LLC or limited liability company. In that case, you’re protected against liabilities if, for whatever reason, you get sued by another business or a client. 

STEP 3: Tax Registration

Tax Registration
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Since you’ve decided to start a business, it would be ludicrous to assume that you won’t be paying any taxes. Therefore, you need to get your laundromat registered for many state and federal taxes before opening and operating your laundromat. 

Ensure that you do your research about taxes and that your documents and tax formalities have been completed before you open to customers. You don’t want to find yourself in hot water with the IRS

Small Business Taxes

Every business structure is taxed differently, and taxes vary from state to state across the United States. Make sure that you’re aware of what taxing is like in your state, and educate yourself about what benefits you can expect from the way you’ve registered your business. 

STEP 4: Registration for a Business Bank Account & Credit Card

Registration for a Business Bank Account & Credit Card
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Now that you’ve gotten your business structure ready and you’ve registered your business for taxes, it’s time to open a bank account and get your credit card. 

We’d recommend keeping your personal and business finances separate because you need to protect your personal assets. Additionally, maintaining a separate credit score can significantly benefit your business in the long run. You can earn better interest rates in the future if you want to take out a loan to open a second location, for example. 

Bank Account Registration

When you open a bank account, make sure that you register it as a business account. It can help you protect your laundromat’s assets, such as your washing machines and dryers, along with other equipment like chairs and tables that you have in the laundry room. A separate bank account also helps when you file your taxes at the end of the financial year. 

Get a Business Credit Card

A business credit card will help you keep track of your finances better. If you mix your personal and professional finances, you might find that your wires get crossed a bit too much, and you might regret this decision later on. Instead, build separate credit, as an individual and as a business. 

STEP 5: Business Accounting Set up

Business Accounting Set up
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Please make sure that you set up an accounting system for your laundromat. One of the essential aspects of running a business is making sure that you record every business expense that occurs. This can help you understand if your business is succeeding or failing, and it also helps you when you need to file a tax return. 

Ensure that you keep an account of every expense and purchase to make your life easier when it’s time to account for everything. 

STEP 6: State & Local Business License & Permits

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You cannot operate your business without a license of any kind. If you’re unsure about this process, start by researching what licenses apply to your business, and go to your local clerk’s registration office and file a license application. You must also apply for a business permit stating that you have permission to operate. If you fail to acquire both a license and permit, your business could get closed permanently, or you could be forced to pay a huge fine. Don’t forget to be careful with the license and permit process!

STEP 7: Insurance for Laundromat Business

Insurance for Laundromat Business
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Insurance is your next step. Make sure that your laundromat is covered by business insurance because, in the event of some business loss, your insurance makes sure that you’re financially protected against any problems. 

You also need to make sure that your employees are also protected with insurance. 

STEP 8: Create your Business Website

Create your Business Website
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Creating a website for your laundromat is the next best step. You can include a list of services that you offer, costs, and other features that your laundromat has that other laundry businesses don’t have. Don’t stress yourself out by trying to create a complicated website. Create a website that tells customers exactly what you offer and who you are! 

Your website can also contain links to other social media pages that you might have, such as Facebook, Twitter, or Instagram. 

STEP 9: Promote your Business

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Promoting your business doesn’t need to be a stressful event. 

How to promote your business?

You can simply create social media accounts using the same handle and use hashtags to drive traffic to your pages. Try and advertise your services in areas that you know don’t have access to laundry services. 

It would also be beneficial to provide potential clients with visuals that give them a sense of what to expect when they visit your laundromat. This is where social media comes in handy! Don’t make the marketing process too complicated for yourself, but make sure you do it successfully. 

How to Retain your Customer?

You can retain customers by offering a loyalty program, where customers get points for the number of garments they wash or the number of times they come to do laundry in a month. The customers can then cash in those points and get one or two free loads of laundry. 

STEP 10: Set up your Business Phone System

A phone system can help clients reach you more easily! It makes life easier in general, and you don’t have to worry about customers reaching out to you on a personal number. 

Start A Laundromat In Your State

If you want to start a laundromat in your state, here are some steps that you can take towards making this happen: 

Find a Business Mentor

Being an entrepreneur is hard, and you need guidance from someone who has more experience than you do. In that case, we’d recommend that you find a mentor who can help you as your business grows and as you manage your business. 

How and When to Build a Team?

Build a team when you have the resources to do so. It is unfair to expect people to work for pay below average rates. However, we’d recommend that you hire at least one or two people to help you run your business so that you don’t feel overburdened. 

What are Some Insider Tips for Jump-Starting a Laundromat?

Set your business up in an area where rent is cheap, and clients are aplenty. Try and partner with an organization that requires laundry to be outsourced, such as a small hotel or a local restaurant. 

What Happens During a Typical Day at a Laundromat?

A typical day involves making sure that the machines are running properly, maintaining a log of the amount earned every day, and keeping track of services offered, if any. 

What Are Some Skills and Experiences that will Help you Build a Successful Laundromat?

You don’t need any specific skills to run a successful laundromat. Just make sure that you know how to run a business! 

Should you Consider Joining a Franchise?

Yes, if you want to run a business that has already been set up and in terms of collecting money, you don’t have the financial ability to start your own business from scratch. 


In this article, we took you through the different steps of starting a laundromat business!