You finally made the plunge and bought an older laundry business. It might be your first operation, or maybe your second or third one. The price was right and from what you are able to see, most of the machines seem to be in decent enough condition, needing just a little work. They are maybe ten or fifteen years old, and in need of some tender loving care. The place wasn’t quite ready for the Junk Yard, but there is equipment that is close to giving up the ghost and will definitely need a lot of help.
Now what do you do?
First, don’t be in too big of a hurry to make any major decisions that cost a lot of money. Run the place for a few weeks to see what the business really needs to make it all work. Does it make the nut and cover all of your costs, including finance payments to the old owner, or to your bank?
An excellent source for information about any laundry is its existing customers. Let’s face it, more of them have more experience with this laundry facility than you do. They know what’s good and bad about this business. Spend enough time talking with the new laundry’s clientele and you will know which machines are the “worst”, which dryers work best and what style of washer is best accepted.
Once you really have the lay of the land, you are better prepared to make decisions.
Equipment and general appearance of the laundry are usually the biggest problem for new owners. The impulse is to replace the old with the new. Quite often that’s a really good decision, but it costs money. During the get acquainted time, without spending too much money, a new owner can materially affect the general look of a laundry. Clean up, paint anda little redecorating can do wonders for the look and ambiance of any laundry.
Experienced owners say they can improve any laundry business by twenty percent, or more, simply by showing their customers that the new owners are really interested in making improvements in the appearance and convenience of a laundry.
One of the main reasons a laundry business gets put up for sale is that the old owner begins to lose interest in the place. Maybe they also lose energy and enthusiasm too. Customers recognized that and responded negatively. A certain amount of energy and activity around the laundry almost always excites the laundry user and they get enthusiastic. They talk with each other and their friends as well. After all, they think of it as being their laundry too.
After several weeks or months have passed, it is time to give the heartbeat of the laundry business a careful examination. The heartbeat of any business is its cash flow, and there are several questions the owner needs ask.
Is the cash flow of the business sufficient to make the payments for any new equipment purchases? If new equipment is in the picture, the question is more than how much and what brand and model. The monthly charges are one factor that cannot be overlooked. When your net cash flow is only a few hundred dollars a month, you simply cannot afford to acquire long term monthly payments for a thousand.
If the cash flow would remain better if existing washers and dryers can be renovated and repaired, that might be your best choice. The question then becomes how much will the repairs cost, who will do the work and how will they be paid for?
The question about who will do the repair work is one that each new owner needs to spend time wondering about. It all depends on how mechanically inclined he or she is. Some will feel as though they have two left thumbs and will want to hire it done. However, if the owner is confident about being able to perform simple repairs, that’s great. The costs for the business will be a lot lower, and more cash remains available for that all important bottom line.
From time to time, even those who have confidence in their own ability to fix things may need to bring in an outside service to fix the more complicated side, such as front load doubles and triples. Most factories have free service schools that are typically held at their distributor for the area. These are designed to show the simplicity and ease of repair for the machines they manufacture. Attending these technical schools may offer enough confidence to do it yourself. And, so far as we have heard, there is no limit to the number of times you can attend a factory’s free service school.
Companies that distribute the brand of dryers, front and top load washers you now own are really an excellent source for information and materials, such as parts and service manuals. They generally carry a stock of the repair parts you will need. They usually offer discounts for their customers. Their personnel will be a good source for general information about the laundry industry in that area.
Their goal is to take good enough care of their customers so that they will be able to sell them new equipment in future. After all, if they don’t take good care of you now, you likely won’t consider them when you do purchase your replacement equipment.
These companies usually will have trained technicians on staff who can do the repair jobs that you are not confident in doing. These techs are the likely source of help for those laundry owners who do not feel comfortable doing their own repair work.
Some new equipment is probably the best way to show the existing customers that the new owners are serious about improving their laundry. It all depends on the cash flow being good enough to support the monthly payments and still leave other operating funds.
There are other considerations new owners must consider, such as advertising the change in ownership. Word of mouth is important, but you can’t always depend on it. Does what you are doing to improve things need to be followed up by circulars or flyers distributed within a mile or two of the laundry? Operators tell us that each time they put out ads, business improves. One of the best ways of improving the bottom line is to stay in the public eye.
You’ve made the decision to buy the older laundry business, we’ve offered you some other ways to make your purchase decision work and become profitable. May the laundry gods bless your new business. Good Luck!
