5 Lessons I Learned from Owning a Laundromat
Hey, my name’s Keira Hamilton. I’m an SBA loan broker and former small business owner. In 2023, I purchased a laundromat for $190k and made $285k in revenue. In this post, I’ll share 5 things I learned from my time owning and operating a laundromat.
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Laundromats have recently gained attention as "boring businesses" with potential for great returns. But what’s the reality behind the buzz? During my time as a laundromat owner, I learned some crucial lessons about owning and operating this kind of business. While laundromats can be profitable, they are far from passive investments. In this post, I'll share five key takeaways from my experience as a laundromat owner.
1. Laundromats Are Not Passive Income
The first myth I want to debunk is that laundromats are passive income. Laundromats, like any small business, demand time and energy. Whether your laundromat is self-service or full-service, you’ll need to be involved in daily operations. Machines require maintenance, customers have questions, and the facility needs regular cleaning. At our laundromat, we offered not only self-serve laundry but also wash and fold and dry cleaning services, which meant there were even more moving parts. If you’re expecting passive income, think again—most likely, you'll be the one running the show.
2. Expect to Work Both In and On Your Business
As a small business owner, you must strike a balance between working in your business and working on your business. Working in the business means managing daily tasks like processing wash and fold orders, maintaining equipment, and handling customer service. On the other hand, working on your business involves strategic planning, marketing, building partnerships, and scaling. “Don’t just buy yourself a job,” you’ll hear people say. And it’s true that it’s important to delegate tasks where possible and focus on growing the business. But the reality of owning a small business and having a small team is that you will often be the one needing to go in to cover shifts when someone is sick or when you get an influx of orders. This can be a good thing because it forces you to keep a pulse on operations and will help you catch problems before they get out of hand.
3. Flexible Scheduling is Key
Many people are interested in owning a laundromat because they view it as a form of passive income that can coexist with their full time job. While there are people who work full time and own laundromats, it’s important for first time buyers to understand that flexibility is essential because problems will arise unexpectedly. Even with the best preparation and the newest machines, things will go wrong. From malfunctioning washers to overflows and even smoke detectors going off due to humidity, laundromats come with unexpected challenges. Just when I thought I had fixed all the issues by upgrading our machines, I still faced problems like error codes and clothes getting stuck. The key is to expect the unexpected and be ready to troubleshoot on the fly. Owning a laundromat alongside my flexible work as an SBA loan broker made it easier to manage both businesses effectively.
4. It’s Not As Simple As Hiring a Manager
When I talk to people who are planning to keep their 9-5 job and buy a laundromat, I’ll ask them how they plan to handle unexpected problems in the middle of the workday. “I’ll just hire a manager,” is a typical answer. It’s not that simple. If you own one laundromat, it’s unlikely you’ll have the cash flow to justify hiring a high-quality manager to be on call for issues at your laundromat. This becomes more likely when you build a portfolio. While you’re in the process of scaling, expect to be the go-to person for covering shifts, handling customer complaints, and coordinating repairs.
5. Be Wary of “Zombie” Laundromats or “Free” Laundromats
A laundromat in disrepair may seem like a bargain, but it can cost you a lot in repairs and time. If you're a first-time owner, it’s best to invest in a business that’s already functioning well. Similarly, beware of any laundromat you can get for “free” or with no money down. There are plenty of courses out there that claim to teach you how to get a laundromat fast, free, and easy. The truth is, business ownership takes time, money, and effort. If something seems fast, free, and easy up front, it’s because you’ve got some work cut out for you on the other side of close. Machine upgrades can cost tens, or even hundreds, of thousands of dollars. And if a laundromat has been abandoned, you’ve got to ask why that is. Is there too much competition in the area? Are there problems with the physical space that are too expensive to fix? Without a recent track record of success, you’re taking on a lot of risk, especially as a first time buyer.
Final Thoughts
Owning a laundromat is a rewarding experience, but it's far from the passive income generator many imagine it to be. It demands time, effort, and flexibility, and you need to find the right balance between being hands-on and growing the business. Most importantly, be realistic about the investment you’re making, and avoid the temptation to buy a laundromat in disrepair unless you’re fully prepared for the challenges.
If you're considering purchasing a laundromat, take these lessons to heart—they could save you a lot of time, money, and stress in the long run!
Wanna learn more about laundromat ownership? Schedule a 1-on-1 call with me, stop by my Office Hours, or check out my YouTube channel for more free, real-world information.
