Long hours, unchecked stress, and a volatile income—that’s what starting a business meant to me until I came across laundromats.
Imagine a steady income stream that works for you around the clock. There’s no inventory to keep track of or employees to manage. There are simply machines operating, customers paying upfront, and the cash flow coming in.
You’re probably thinking, ‘What’s the catch?’ right?
Laundromats are one of those hidden gem businesses. They thrive on high demand, require minimal labor, and can generate serious passive income.
But they’re not quite as straightforward as they first appear.
There are startup costs. Maintenance headaches. Competition. And not every location is a goldmine.
So, if you are thinking of starting a laundromat business and were wondering:
- How much money can you make from the laundry business?
- How much does it require to invest?
- What the profit margins are?
- What challenges do laundry businesses often face?
- And how to make your laundromat successful?
Then this guide will answer every question you have.
Is Owning a Laundromat Profitable?
For those who want the one-liner of the question, is the laundry business profitable? The answer is yes. Laundromats are considered among the most profitable and self-sustaining small businesses. They have a high cash flow, which is further elevated by low labor costs and a constant demand for the service.
There is also no business model that is able to compete with that. Not even a gas station or car dealership.
No matter what happens to the economy, people or relevant businesses like hotels will always require clean clothing. They may cut down on going out for food or getting new subscriptions, but washing clothes is simply not optional. That’s why laundromats are recession-proof, where other businesses struggle during a downturn.
Aside from that, laundromats also do not have to deal with many business hurdles. Unlike retail shops and restaurants, laundromats do not have stock control.
There is no inventory. No need to monitor perishable items. Customers pay in advance, do their laundry, and leave. It’s that straightforward.
And here’s another advantage: labor costs are ridiculously low.
Most laundromats are self-service, so full-time staff are not needed. If you choose to employ someone, it’s typically only for maintenance services or customer service. This means less payroll and lesser management work for the business owner.
Another factor to consider in this business is passive income.
Laundry is a recurring chore, unlike one-time services. A laundromat customer tends to become a loyal customer once they identify a laundromat that they prefer, unlike gym memberships or car washes, where there is a limit as to how long people can postpone them.
Then there’s the survival rate.
About 95% of laundromats are still in business after five years. That’s almost unheard of in a small business. Almost 45% of new businesses fail in the first 4 years.
For instance, 60% of restaurants fail in that same period.
Laundromats succeed because their costs are predictable, demand is steady, and they don’t rely on trends or changing consumer habits.
While restaurants struggle with profit margins of just 3% to 5% on average, a well-run laundromat can pull in 20% to 35%—sometimes even more. That’s four to ten times what many restaurants make.
The secret lies in their cost structure.
Yes, there are fixed costs—rent, utilities, loan payments—but once those are covered, the rest of the revenue goes straight to the bottom line. By maximizing operational efficiencies, owners can push profit margins even higher.
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How much money can a laundromat make?
When people think about opening a laundromat, they always ask the same thing: How much money can I actually make?
The real answer is, it depends. Because it’s not just about starting the business, many factors decide the success and profit margins.
Location, machine capacity, and extra services all play a role. But in general, laundromats make steady money. They have strong profit margins and lower costs than most small businesses.
The most appealing side of the laundry business is that when done right, you can earn between $5,000 and $25,000 per month, that’s what most laundry business owners make.
Here is a breakdown of money made based on locations and size: A small laundromat in a quiet town might bring in $5,000 to $7,000 a month. A large one in a busy city can pull in $20,000 or more. Some do even better, especially if they offer extras like wash and fold, pickup and delivery, or vending machines.
According to these statistics, the average laundromat makes between $150,000 and $300,000 per year.
The most successful ones earn even more. Since people always need clean clothes, laundromats tend to have steady revenue, even during economic downturns.
The biggest factor: Location
Where you open your laundromat makes all the difference.
Urban laundromats usually make more than suburban or rural ones. Simply because more people need them.
Areas with a lot of renters, students, or low-income households also bring in more business. Many people in these areas don’t own a washer and dryer, so they rely on laundromats.
Here are some interesting statistics: Laundromats in neighborhoods where at least 40% of people rent earn 25% to 40% more than those in homeowner-heavy areas.
Startup costs: What it takes to get started
It will not be cheap to open a laundromat. It would cost at least $200,000 to $500,000 for a start-up. It can cost as little as $50,000 to $200,000 for a space lease.
The most expensive will always be the equipment: commercial washers and dryers will range between $1,000 and $7,000 each. Starting a laundromat will require good equipment; it would range from $100,000 to $300,000.
Besides the cost of operation, there will be utility costs as well; water, gas, and electricity amount to 15 to 30 percent of revenue. The other aspects of a laundromat will consist of insurance, rent, maintenance, and business licenses.
How soon does it become profitable?
Generally, laundromats make their profit from about 12 to 24 months after opening. In highly sought locations, such as high-traffic areas, the average break-even time for a laundromat would take just over a year.
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Different types of laundromats and how profitable they are:
Laundromats all differ from one another. Some are effective and efficient, operating with almost mechanical precision; some involve more ups and downs than others in their management, but offer better payoffs.
Choosing the right one among a pool of options is determined by how far you want to put in and how much start-up capital you’re willing to pump into it.
Self-service laundromats:
If you are looking for a business that comes closest to being able to run without you, then a self-service laundromat might be the best shot for you.
Basically, all automated laundromats provide customers with some machines where they can wash their stuff and leave without any employees present.
Due to the low or nonexistent staffing, labor costs are close to nothing; thus, it’s an attractive option for somebody looking for more passive income with minimal effort.
Full-service laundromats:
The full-service laundromat makes more revenue, but it demands more of your time and dedication.
These laundry spots do more than wash clothes. They fold them for you, offer dry cleaning for extra cash, and even pick up and drop off laundry for busy individuals. For that convenience, you can charge more.
A lot of people are very happy to pay a little more to save time.
The downside: well, the labor cost. Because someone must tend to these services, you will have to bear the cost of hiring, training, and putting together a schedule for your staff. Yet, if you do it right, the extra revenue will certainly surpass the expenditures.
Franchise vs. Independent laundromat:
When you’re about to start a laundromat, you have two choices when opening a laundromat.
- Go independent
- Or buy a franchise
If you have little experience in this type of work, then a franchise is a good option because they provide a well-known brand along with training and assistance.
However, you do incur higher costs and franchise fees that will lower your profit.
With an independent laundromat, you can take full charge. You determine how much to charge, which machines to buy, and how the business should be advertised.
Also, there are no franchise fees, so you can increase your profits.
The downside is that you will have to figure everything out on your own.
If you put in the effort, both options can yield positive gains. A good location with high demand, along with effective management, will guarantee success.
How to maximize profit in a laundromat business?
Owning a laundromat doesn’t exclusively mean having washers and dryers. You need to make wise decisions to gain additional revenues at the least cost.
If you’re looking for your laundromat to make more than just a straw profit, it’s high time you start to think strategically.
You have to choose the right location, offer services that people actually want, cut unnecessary costs, keep customers coming back, and expand when the time is right.
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Location: The make-or-break factor
If there is one thing that can make or break your laundromat business, it is the location.
The best machines, the cleanest floors, free WiFi—it will all be for nothing if your laundromat is not located in the right place.
What, then, comprises that right location? The best laundromat sites occur around apartments, colleges, or areas with a large number of renters.
That’s because renters seldom have their own washers and dryers; they will always need you.
Apartment complexes may have laundry rooms, but these might be small, expensive, or perpetually accessed.
If your laundromat is within proximity, people would willingly come to you instead. Urban areas perform much better than suburban or rural areas, simply because more people = more laundry.
If you can set up shop somewhere near a college campus, you are talking of a continuous flow of student-launderers who do not want to linger around waiting for free machines in the cramped basement of a dorm.
So, ideally, before committing to a location, spend some time in the area. Count how many laundromats are nearby, see how busy they get, and check whether there’s enough demand to justify opening one.
Give customers more reasons to walk through the door:
Self-service laundromats can be quite profitable, but it’s the extra services that will really elevate your laundry business to the next level.
Just think of it: Nobody really enjoys doing their laundry. If you make it easier for them, they will pay extra for your extra efforts.
One good way to do this is by offering wash-and-fold services. Allow customers to drop off their laundry so they don’t have to wait, and then they can come back for it after it’s been folded.
You can charge by the pound or by the load, making for a reliable income stream. Pickup and delivery is the other game-changer. It would be excellent for those who are either simply too busy or lazy to walk in and do their laundry.
An even better service is one that places particular emphasis on busy professionals working long hours and just cannot find the time to sit in a laundromat.
Cut costs without cutting corners:
Laundromats make money, but they also cost money. If you’re not careful, high water bills and electricity costs can eat into your profits. The good news is that there are ways to cut expenses without compromising on quality.
First things first, buy energy-efficient machines.
The modern washer and dryer use 40% less water and consume around 25% less electricity than older models. Though investments come first, they will give back the cost in lower monthly utility bills.
Speaking of energy, if you’re in an area that gets a lot of sun, consider installing solar panels. They can cut electricity costs in half over time. Some laundromat owners have even eliminated their electric bills completely!
Another way to save is to purchase high-quality used machines instead of brand-new ones. If properly maintained, refurbished washers and dryers can cost about half of a new one and perform equally well.
Finally, don’t forget regular maintenance.
A broken machine doesn’t just cost money in repairs—it also means lost revenue because no one can use it.
Keeping your equipment in top shape prevents costly breakdowns and keeps your business running smoothly.
Make customers love your laundromat:
Getting new customers is hard and expensive, so the real secret to long-term success is keeping the customers you already have. People don’t just want a place to wash their clothes—they want a laundromat they actually enjoy going to.
One way to keep people coming back is by offering a loyalty program. It’s a simple idea: wash ten or even twenty times, get one free. Customers love getting rewarded, and it gives them a reason to choose you over the competition.
You can also run special promotions to boost traffic on slow days.
For example, offer a discount on Tuesdays or give free detergent with every wash during certain hours. A little incentive can go a long way in filling up your machines.
Cleanliness also matters more than you think.
A dirty laundromat with lint on the floor and trash overflowing from bins will make customers leave and never return. Keeping things spotless and well-lit makes people feel safer and more comfortable.
And let’s not forget customer service.
Even if you run a self-service laundromat, having a friendly attendant on-site can make a huge difference. They can help with machine issues, keep things clean, and create a welcoming atmosphere that makes customers want to return.
Expand when the time is right:
After your laundromat is well-oiled and making the dough, now it’s time to think big.
Expansion doesn’t always have to mean training on opening another site. Sometimes, it can imply something as simple as new machines, some new spaces, or providing more services.
More customers and revenue can be served by larger-capacity washers and dryers when your laundromat is ever busy. Within the space you have, other things you can add to improve running efficiency are a dry-cleaning section or more folding tables.
If you’re looking to expand, opening a second location in a high-demand area can double or triple your income.
For many, laundromat owners develop their whole network.
Take Brandon R. for example, once a banker is now a laundromat business owner. He started with one laundromat and now has four successful locations in California. He utilized the correct spots and orchestrated operations really well, thereby converting a single laundromat into a living.
And if your business model really takes off, you might choose to opt for franchising. Other people can then open laundromats under your name, and you’ll walk away with the franchise fees, which is really an entirely new tier of passive income.
Make payments easier:
Nowadays, people no longer carry cash.
If your laundromat is coin-operated only, you could be losing business. Customers want convenient payment options, and accepting credit cards, mobile payments, or even a prepaid laundry card system can help you attract more people.
Studies show that people spend more when using digital payments because it’s easier than dealing with coins.
Plus, digital payment systems can track revenue, reduce theft, and integrate with loyalty programs, making them a win-win.
Challenges in operating a laundromat:
Though a laundromat operation can be highly lucrative, it is not without its challenges.
Utility costs rank among the very top of those expenses.
Water, gas, and electricity take up between 15% and 30% of revenue, with larger laundromats paying even more.
Many owners invest in energy-efficient machines or even solar panels to save money, but upgrading requires a significant upfront investment.
Machines wear out over time.
Washers may develop leaks, dryers often have heating problems, and repairs can be expensive. Fixing a washer can cost $200 to $1,000, while replacing one can exceed $5,000. Regular maintenance helps reduce breakdowns, but machine failures are inevitable.
Theft and vandalism are additional risks, particularly in unattended laundromats.
Coin machines may be targeted, and loiterers can discourage customers. Security cameras, bright lighting, and hiring an attendant can help, but they also add to overhead costs.
Competition presents another obstacle.
Apartment complexes with in-unit laundry and nearby laundromats can make it tough to attract customers. Offering better services—such as wash and fold, digital payments, or free WiFi—can help set you apart.
Consumer behavior is also shifting.
More people now own washing machines at home, and subscription laundry services like Rinse and SudShare are growing. These companies offer pickup and delivery, creating direct competition for traditional laundromats.
Some laundromat owners have adapted by launching their own pickup and delivery services to stay competitive.
At last, we can confidently say, with the right operations management, laundromats can still be strong, viable, and profitable businesses. Those who stay ahead of the curve and adapt to changes will find laundromats to be a stable and rewarding investment.