Your Guide to Buying a Dry Cleaner Business

As a shift in customer preferences and increased competition continue to impact the dry cleaning industry, it’s increasingly important to do your research when buying a dry cleaner business. Continue reading below for guidance through the buying process and for must-ask questions.

Must-Ask Questions When Buying a Dry Cleaner

Once you’ve found a full service dry cleaner for sale that interests you, utilize this list of questions to learn everything you can about the business.

1. What are average revenues for a dry cleaner business?

The dry cleaner industry’s annual revenues have taken a hit in recent years. In 2019, the United States dry cleaning industry’s revenue was $9 billion, but that number is expected to drop in the coming years. As annual revenues decrease, it’s more important than ever before to do some serious due diligence before buying a dry cleaner business.

2. What differentiates a dry cleaning business?

In a highly-saturated, competitive market where consumers are buying wash and wear garments, it’s critical that a dry cleaner business differentiates itself from competitors. Consider what the dry cleaning service in question does to set itself apart. Aside from high quality service, here are some things to look for in a dry cleaners for sale are:

• Environmentally-friendly practices;
• Convenient pick-up, drop off, and delivery services;
• Ability to clean home goods like carpets and rugs;
• Laundry services;
• Alterations services;
• Commercial laundry programs;
• Same-day services; and
• Hanger recycling.

If the established dry cleaner you’re interested in buying isn’t implementing any of the above programs, consider the viability of adding the programs yourself.

3. Why is the dry cleaner owner selling his or her business?

Small business owners commonly sell their dry cleaning businesses due to retirement, illness, new opportunities, and burnout. When talking with the existing owner of the dry cleaning business, ask why he or she is selling.

If he or she is selling for financial reasons, this could be a sign that the dry cleaner business isn’t doing well. While a new owner could turn the business around, it’s imperative that you do some additional research before signing any agreements.

Financial Questions to Ask When Buying a Dry Cleaner Business

Ask the existing owner-operator the following cash flow and financial questions to ensure you are making a wise purchase decision.

4. Is real estate included in the deal?

If the dry cleaning business is located in a high traffic area and you’re happy with the general location and shopping center, determine whether the business owner is leasing the space or owns the space. If he or she owns the storefront, ask if they intend to sell the real estate with the business. For leased spaces, speak with the landlord and review the agreement to determine whether or not the lease is transferable.

5. Is the dry cleaning equipment included in the sale?

Between presses, form finishers, and toppers, dry cleaning machines can add up quickly. Talk with the current owner to determine whether or not the dry cleaning equipment is included in the sale of the business. If the equipment is not included, consider the added cost of purchasing the essentials in addition to this already sizable investment.

6. What are the average operating expenses of the business?

If you’re seriously considering buying an established dry cleaner business in your area, ask to review pertinent financial documents, contracts, taxes and utility bills. This type of paperwork will help you understand the average operating expenses of the business.

7. What is the asking price for the dry cleaner?

Last, but certainly not least, you must ask the existing owner how he or she arrived at the asking price. If the dry cleaners’ asking price was chosen based on a professional valuation service, it’s likely an accurate reflection of the value of the business. While there may be room for negotiation, the owner will likely be more firm during negotiations.

For help finding a successful dry cleaning facility for sale or guidance through the process of buying a dry cleaner business, contact a business brokerage firm near you like Sunbelt Business Brokers. Sunbelt’s business brokers have helped thousands of entrepreneurs like you find their ideal business.

Article updated on December 5, 2019.