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What are some things I need to consider when buying an existing coin laundry business?

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The BAF Group LLC

Age of the equipment is always an issue. The location is best when around old homes and apartments that did not have space for washers/dryers when they were built - developments with new homes/apartments have less of a need, because they usually have laundry facilities in them.

But the biggest concern is the Cash Flow. Since it is a cash business, much of the Revenue is in the pocket and not on the Tax Return. How do you justify the price? Some people pay on the basis of $X per machine. Others do their homework and look at the amount of gallons of water used each year. Then you look at the Washing Machines themselves and determine how many gallons are needed for one wash. Detailed math will tell you how many washes are then done each year, and you can figure out how much the Seller is earning from the Washers from that. The number of Dryer rounds is more difficult; some people will combine Dry cycles from two or more wash cycles, but that is the way you can start. A lot of it is a wild, educated guess!

Getting such a business financed is virtually impossible, if the Seller is under reporting his/her Revenue and expecting to get paid on the basis of what he/she is really pocketing. That's why most Laundries (at least in the Maryland area) are bought an paid for in cash.

Dec 10, 2012