Welcome back to our series on selling your laundromat for profit. In our previous post, we addressed the importance of selling while your business is stable and your equipment is in good condition. Most laundromat owners are tempted to sell their business when their equipment is declining in condition, however doing so may cause you to have a more difficult time finding a buyer who is willing to assume the cost of replacing equipment in addition to the cost of purchasing your business. Many buyers are also concerned about the location of your store and the crime rate in the surrounding area. Owners who are transparent about these issues and how they have chosen to protect their store with the addition of security systems, additional exterior lighting, and staffing are more likely to be able to minimize these concerns for potential buyers. In this post, we will be examining strategies for setting a price for your laundromat and how to know when is the right time to put your laundry on the market.
Knowing When to Sell
Get the upper hand in the sales process by being honest with yourself about the current state of your business. Ideally, you should sell when the sales in your business are steady and your initial investment has been returned. Owners who choose to sell their businesses when sales are stable and their equipment is in good shape will be able to ask for a higher amount and can expect their store to sell more quickly.
Here are some benchmarks to consider when it comes to the life of your equipment:
Dryers (30 lbs. to 60 lbs.) - Lifespan 15-20 years
Frontload Washers (18 lbs. to 50 lbs.) - Lifespan 10-15 years
Topload Washers (12 lbs. to 14 lbs.) - Lifespan 5-8 years
Coin Changers - Lifespan 10-15 years
HVAC Systems - Lifespan 10-15 years
Having the maintenance records for these critical components can help reassure buyers that the equipment has been maintained regularly.
Establish Your Asking Price
Depending upon the condition of your equipment, the market where your laundromat is located, the location of the store, and water usage in your business, most owners ask between one and one and a half times their gross annual sales for their laundromat. If your store has high utility usage, the equipment is near the end of its lifespan, or the HVAC system in your business needs repair, you'll need to adjust your asking price accordingly. Working with a broker or laundry consultant can help you accurately evaluate the condition of your business and aid you in determining an asking price for your store.
Alternative Wascomat Dealers SC
T & L Laundry Equipment knows that opening your own laundromat or choosing to buy an existing property takes a lot of thought and planning. Let our team of laundry professionals assist you in evaluating the condition of the existing equipment, the location of the store, and assessing the competition in the area you are considering. Our more than 40 years of industry experience can help you make the best decision for your investment in 2019. Call and schedule your free onsite evaluation today!
