Laundromat Business Valuation Benchmarks

Laundromat and coin laundry business owners, prospective buyers, and industry investors rely on a diverse set of financial benchmarks to assess the value of a business. We have compiled data from current BizBuySell listings and sold businesses to provide insight into the business for sale market and important benchmarks for pricing and evaluating laundromat businesses relative to industry standards.

See also: Commercial Laundry Business Valuation

Jump To:

Highlights of Laundromat Businesses Sold on BizBuySell

Laundromats listed and sold on BizBuySell are comprised primarily of small, locally owned businesses offering self-service access to washing machines and dryers. A minority of laundromats listed for sale are part of a franchise, though not enough to materially affect average financials or valuation multiples. Most laundromat businesses listed for sale are coin and/or card based self-service businesses, though some also offer additional personalized services such as dry cleaning, wash & fold services, or alterations.

Laundromat Business Transaction Trends

The median value of laundromat businesses has been increasing consistently for the past five years, at an average of about 8% annually. In the years following the pandemic closures, sales prices closed on asking prices, signaling increasing demand for these businesses. In 2024, that difference increased as buyers no longer met sellers' high expectations.

Laundromat Business Valuation Multiples

Valuation, or pricing, multiples are financial tools that allow for comparisons between businesses that have different levels of sales and financial performance. They represent the sales price of a business relative to its revenue or earnings, and given enough individual business sales data, they represent what the market is willing to pay for a business given its revenue and earnings.

Valuation Trends

Business values and associated multiples fluctuate over time, influenced by a variety of macroeconomic factors such as interest rates, inflation, consumer spending, and overall economic growth. Laundromat valuation multiples have always been on the higher side of service businesses, and rose markedly after the height of the pandemic, with the average earnings multiple reaching 3.6 before settling at 3.5 through 2024.

Earnings Multiples

Earnings multiples represent the value of a business relative to its owner’s discretionary earnings or "cash flow". Arguably the most important valuation metric - as seller's discretionary earnings will often dictate how much a buyer is able to borrow to finance the business acquisition - most valuations will hinge on a reasonable earnings multiple.

Revenue Multiples

Revenue multiples represent the value of a business relative to its overall sales or revenue. In conjunction with an earnings analysis, revenue multiples are commonly used to value a business based on its overall sales.

How to Interpret These Multiples

Recent Listings vs. Sold Businesses

We calculate and provide valuation multiples from two sources: Current and recent listings of laundromat and coin laundry businesses for sale, and our database of "comparable" businesses sold on BizBuySell. Multiples based on listing data are always higher due to owners setting asking prices above what their businesses might typically sell for. This occurs either intentionally as a negotiation strategy, or incidentally due to business owners’ common tendency to overvalue their own businesses.

Multiples based on comparable businesses - "comps" in business broker parlance - are much more useful as they represent the prices at which businesses ultimately get sold. Business brokers and valuation professionals will always turn to local comps when pricing businesses for sale or evaluating businesses for acquisition. We provide both sets of data on the national level to offer general context. Local business sale comps by sales class suitable for pricing and negotiations are available in BizBuySell's Business Valuation Report.

Quartiles, Median, and Average

No two businesses are identical, and as such, valuation multiples exist in a range. We have carved out four common values within this range: Lower quartile represents the value under which the lowest 25% of valuation multiples fell. Upper quartile represents the value above which the highest 25% of multiples fell. Median is the middle of the range, and average is the mean of the set. Mean is almost always higher than the median, driven by a minority of high volume, high value businesses sold at multiples above the upper quartile.

Businesses with consistent financial performance, above average revenue and earnings, demonstrable growth potential, low owner involvement, unique competitive advantages, and a seller willing to finance will command a multiple at or above the upper quartile. Lower volume businesses with thin profit margins, full-time owner involvement, and many direct competitors will trade at or below the lower quartile. Most businesses will fall somewhere in the middle.

Based on this data, half of laundromat businesses are valued and sold between 2.6 and 4.2 times their annual seller discretionary earnings, with 25% of exceptional, higher volume laundromat businesses trading above this range, and 25% of smaller, less desirable laundromats selling below.

Financial Benchmarks

To determine how a business compares in terms of sales volume and financial performance relative to industry peers, it’s necessary to have some insight into industry standards. "Benchmarking" describes the practice of comparing a business’s financial performance to typical industry standards to determine where a business falls relative to other businesses in the same industry. These benchmarks can help guide laundromat business owners and investors towards appropriate valuation multiples from the range above.

To that end, we have aggregated laundromat business financial ranges useful for comparing a given laundromat business to the broader market.

Laundromat Business Revenue and Earnings Trends

Like many small businesses, laundromats have increased sales and earnings following the plateau in the years prior and through the peak of the pandemic. Median revenue in 2022 and 2023 rose 22% versus the three years prior. At the same time, discretionary earnings margins rose from an average of 35% to nearly 38%, easily making laundromats one of the most profitable types of small business traded on BizBuySell. In 2024 revenue and earnings fell 13% and 16%, respectively, as inflation and higher interest rates put pressure on financial performance.

Earnings Ranges

Discretionary earnings (used interchangeably with the terms "cash flow" and seller's discretionary earnings or SDE) is often the crux of business valuations, so it is important to benchmark it relative to other similar businesses traded on the business for sale market. Below you will find discretionary earnings ranges for laundromats sold over the past five years, as well as recent laundromat business for sale listings.

Revenue Ranges

Revenue volume plays a large role in business valuation, as it measures the size of the potential income opportunity for new ownership. It's not uncommon for buyers to select an earnings multiple range based on overall revenue volume. The table below includes revenue ranges of businesses sold over the past five years and recent laundromat businesses listed for sale.

How Revenue and Earnings Level Affects Business Values

Obviously, higher levels of earnings lead to higher valuations, even given the same multiple. However, valuation multiples also tend to rise with business sales volume. Laundromats that generate higher sales (and maintain benchmark profit margins) tend to sell for earnings multiples on the higher end. So, a laundromat generating over $350k in revenue may command an earnings multiple over 4, while a smaller laundromat with sales below $150k may trade closer to 2.6 times its discretionary earnings.

This tendency for higher sales volumes to fetch higher valuation multiples is largely driven by the economics of business acquisition financing. Businesses with greater revenue and earnings give buyers more cushion to cover debt service obligations and still have enough left over to pay the new owner a reasonable income.

Service Sector Comparisons

For a more complete understanding of the market and valuation standards, consider comparisons within the broader service sector when benchmarking laundromats. The chart and table below include key metrics from sales of select personal service businesses on BizBuySell.

Compared to other types of businesses in the personal service sector, laundromat business valuations are much higher relative to revenue volume. One of the primary drivers of these high valuations is the nature of the business model. Investors and business buyers are willing to pay a premium for absentee run businesses that require very little operational labor and maintenance. Laundromats are the quintessential "passive income" operation, where customers serve themselves, paying for access, and utilizing the business assets directly. This means laundromat owners have low maintenance overhead and very little, if any, labor costs.

More Resources and Tools from BizBuySell

Thinking of buying or selling a business? BizBuySell has the tools, resources, and professionals you need to get down to business.