5 Questions to Consider Before You Sell a Laundromat

Posted On: 02/03/2019 / By:
Selling A Business

Due to increased disposable income and rising competition, the laundromat industry’s revenues have decreased at an annualized rate of 0.1% over the last five years. Projections indicate the industry will continue to decline over the next several years, making it increasingly difficult to exit the industry successfully. If you’re preparing to sell a laundromat, you must think creatively about how to maximize the value of your business. To get started, consider the following five questions.

Considerations When Preparing to Sell a Laundromat

When preparing to sell a laundromat business, ask yourself the following five questions to land a profitable deal.

1. How do I plan to exit the laundromat business?

Before you can begin to sell a laundromat, you must have an exit strategy in place. A basic exit strategy answers all of the following questions:

  • When do I plan to exit my laundromat business?
  • After selling, do I plan to continue working as an advisor or manager for a set amount of time?
  • Do my retirement plans depend on the sale of my laundromat?
  • Will the laundromat’s employees continue working for the business under new ownership?
  • Do I have all my books in order and ready to show a potential buyer?

If you’re having trouble answering these questions, consider working with a lawyer, advisor or business broker to formulate a sound, actionable plan.

2. Who will buy my laundromat business?

woman using machine at laundromat business

Next, consider who will buy your card or coin-operated laundry business. Common business successors in the laundromat industry include:

  • Third-party buyers,
  • Competitors,
  • Employees, and
  • Family members.

Weigh your options and be sure to consider which successor will be most beneficial to you, your employees, your family, and the business.

3. How can I increase revenues and set my laundromat apart from competition?

As disposable income increases, more people are investing in at-home washing machines, as well as using laundry services and dry cleaners. As a result, the laundromat industry’s customer base is dwindling, and annual revenues are decreasing.

To attract a buyer, you must prove that your revenues are steady, even as the industry struggles. Revenue-generating business enhancements to consider include:

  • A pick-up and drop-off laundry service,
  • A wash and fold service,
  • Vending for dryer sheets, fabric softener, bleach, and detergent,
  • Food and drink vending machines, and
  • Selling add-on cycles or specialty cycles.

4. How much is my laundromat business worth?

One of the most important steps when preparing your laundromat for sale is valuing the business. Because business owners often have an emotional attachment to their businesses, it’s best to hire a third party to perform a valuation. Equipped with a professional valuation or a brokers opinion of value (BOV), you’ll be able to select and defend an asking price.

5. How will I sell a laundromat?

From listing the laundromat for sale and marketing the listing to pre-qualifying potential buyers and negotiating a deal, selling a laundry business takes a considerable amount of time and effort. Many laundromat owners find it difficult to operate their businesses while trying to navigate a sale.

To help alleviate the stress associated with selling a laundromat, consider enlisting the help of a business intermediary. A business intermediary, or business broker, has the market knowledge and expertise to help you navigate the sales process. To learn more about working with a professional to sell a laundromat, contact your nearest Sunbelt Business Brokers office. Founded in 1978, Sunbelt is an international network of business brokers dedicated to helping business owners, like you, close a deal!

Brian Knoderer

Brian Knoderer is the President of Sunbelt Business Brokers. He has over 20 years of experience as a business owner and managing business transactions. As a seasoned intermediary, Brian has successfully represented companies in a broad range of industries helping business owners achieve their desired exit strategy or growth initiative.

Brian is also co-owner of Sunbelt Indiana and Managing Director of MMI Capital Partners, a franchisor focused investment banking firm.

Previously Brian was involved in several entrepreneurial ventures as well as having held corporate roles in Franchise Development for Prime Hospitality and Choice Hotels.

Brian is a graduate of Ball State University with a degree in Management Information Systems and earned his MBA from Butler University. He has received the Certified Merger & Acquisition Advisor (CM&AA) designation, holds both the Series 7 – General Security License and the Series 63 – Uniform Securities Licenses, and is a licensed Real Estate Broker. He has been affiliated with several organizations including the Entrepreneur Organization, a Member of the International Business Brokers Association, Venture Club, and a Board Member of The Entrepreneur Institute.

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