These days, most experts will advise you to create a business plan before you decide to take the risks associated with starting a business. A laundromat is typically a bit more complicated than other small business models, making the need for research, planning, and clear direction even more essential for entrepreneurs entering the coin-operated laundry industry.
A laundry business plan will help you prove to yourself that your ideas are viable. With a plan in place, you will be able to set clear goals and chart a path to achieve them in an organized manner. A solid business plan can become essential if you have to show it to financiers or investors before you get the start-up funds you need. Lastly, it will help you be more realistic and ask yourself some tough questions about your ideas.
In this article, we have established an example of a laundromat business plan design. We have set out some examples of titles and content that you might consider using. Feel free to use it as a template as you come up with your own plan.
Your plan should be arranged in a binder with a cover that describes what the report is about and who contributed to it. Your plan is likely to be read by many different parties, so you may consider attaching a cover letter to each that specifically addresses the reader, highlighting the concerns you will have.
If the plan has more than a couple of pages, it must include a table of contents. This includes a list of all titles and subtitles along with a page reference so that the reader can quickly locate the information.
An executive summary is a simple introduction to the report. Give the reader a brief introduction to your business plan and summarize each section of the plan.
While not essential, some companies like to establish a mission statement that describes their business purpose or philosophy. It generally covers non-financial reasons. In the case of a laundromat, you can say that you are striving to provide the best service to your customers or that you want to provide a clean, safe, and efficient way for them to do their laundry. Your mission should be to do your best for the customer and to be better than your competitors.
Provide readers with general information about yourself and anyone else who is involved in the proposed laundromat. Readers may want to know what your qualifications are and if you have had any experience in business or in the coin laundry industry.
Provide background on the local coin laundry industry so readers better understand the opportunities available.
If your planning has been in progress for a while, you may want to update the reader on where you are. If you are considering purchasing an existing laundromat, you will also want to summarize the history of the business in this section.
Provide readers with a basic overview of the proposed coin laundry business. When will your new unit open? Where will it be found? Will you have an on-site laundry attendant all day or only part-time?
Goals and goals
Establish a list of realistic goals that you want to achieve with the company in the first year or two. These goals could be financial and related to gross or net monthly earnings. They could also be related to other metrics, such as the number of members or customer satisfaction rates. Thinking longer term, you can also set goals to expand to new locations.
Before you can launch your new laundry business, you need to know exactly what you are going to need and how much it will cost. The costs will include everything from purchasing equipment, renovations, and marketing along with professional fees and compliance costs.
Once you’ve listed everything, you can calculate the total startup cost. From here you can mention some of the options you have to finance the laundry. Mention how much you will be able to contribute yourself and how much external funding you will need.
Products and services
Review the services you plan to offer to clients. In addition to a basic machine laundry service with washers and dryers, it can also offer more exclusive services such as ironing or dry cleaning. Write down the products that will be sold on site. Obviously, you will sell laundry related products like soap powder and fabric softener, but you can also offer unrelated products like coffee and soft drinks.
As a prerequisite for writing a plan, you should have done at least a little market research in the area where you intend to open your coin launderette. You can present your findings in this section of the plan.
In your research, you should try to find out if there is sufficient demand for a laundromat in the area in question, and if so, exactly what kinds of services people want within this target market.
You should also consider the competition you have in the local area. Create a map that shows the catchment area for your customers, keeping in mind that customers will generally go to the laundromat that is the most convenient for them to get to. Look at the strengths and weaknesses of your competitors. Will it be possible to remove customers from the area of influence of the competitor’s laundries? Can you make your service much more attractive than theirs?
Set up a plan to attract new customers to your laundry and turn them into repeat customers. The marketing component of your plan should cover everything from your branding, pricing, advertising, other marketing methods, and customer service.
Remember that in the laundry business you will depend on building long-term relationships with regular customers. Not only should you focus on attracting new customers, but you should also focus on satisfying and “overdelivering” your existing customer base. If you retain your customers and please them, you will also benefit from referrals and “word of mouth.”
Establish a plan for the daily operation of your laundry. Make a note of the equipment you will have in place and how the water and power demands will be met. Mention how you plan to maintain the machines.
Analyze your daily staffing needs. What role will you, as the owner, play in the day-to-day running of the laundry? How many employees will you need and what will your responsibilities be?
What other systems will you have to ensure that the laundry runs smoothly on a daily basis and that you can monitor and manage the business efficiently? Will you have a computer system to keep track of stocks and cash flows? What about a security system?
Last but most importantly, a solid business plan will include detailed financial forecasts over a two to three year period. This data is best displayed in spreadsheets so you can set up a column for each month. Some companies include more than one spreadsheet to allow for different scenarios. You might consider including one as the best case scenario and others that show revenue is growing at a slower rate than expected.
Try to identify a breakeven point where the business would basically run without making a profit, but without losing money at the same time. Then you will have an idea of the volume of clients you will have to target. To calculate the breakeven point, you must assume an average customer spend per visit and then calculate the number of customer visits required on a monthly basis.
If you are borrowing money to start the business, you should also include a payment schedule to show how quickly the loan will be repaid.
Many assumptions are made in business plans, so it is important to be able to give reasons for why you made those assumptions. Instead of guessing, you should try to include data to support your theories. Include an appendix at the end of your plan that includes all the supporting materials that do not fit conveniently on the pages of the report. These could include maps, images, spreadsheets, tables, and lists of references and sources, to name just a few examples.