Conversation with Merlin [email protected] · Thu Nov 16 2023

Gross Sales Gross Sales Total Sales Material Cost of Goods sold Labor Cost of Goods sold Total Cost of Goods Sold (variable costs) Gross Profit Advert, promo, printing Credit Card fees Insurance, liability Insurance, workers comp Interest portion of loan pmnts Maintenance Office Supplies Payroll (Owner's draw) Payroll service Payroll taxes Professional fees Rent Taxes property & other Telephone and cable Trash removal Utilities Website Web design

Total Operating Expense (fixed costs) Net Operating Income Other income (expense) Net Income Before Tax

Based on the provided data, you are looking to organize and understand the financial metrics to your business. Here's a breakdown of the required financial calculations based on the data you've provided:

  1. Gross Sales: The total revenue generated from all sales before any deductions.

  2. Total Cost of Goods Sold (Variable Costs): The material cost of goods sold and the labor cost of goods sold combined.

  3. Gross Profit: Gross sales minus the total cost of goods sold (variable costs).

  4. Total Operating Expense (Fixed Costs): The sum of all the operating expenses listed.

  5. Net Operating Income: Gross Profit minus the total operating expenses (fixed costs).

  6. Other Income (Expense): Any additional income or expenses not covered in the previous categories.

  7. Net Income Before Tax: The total net operating income plus any other income and minus any other expenses.

By following these calculations, you can obtain a comprehensive understanding of your business's financial performance.

If you need further assistance in performing specific financial calculations, please let me know!

Accurate sales forecasting is critical to your success. It paints a picture of where your business is going, sets realistic quotas for your sales team and helps you make informed business decisions. Despite its importance, a study from Gartner found that only 45% of sales leaders have high confidence in their forecasting accuracy. But how exactly can you improve your forecasting accuracy? A good place to start is to understand your total sales and revenue, which involves keeping tabs on gross sales and net sales. In this post, well show you how to calculate your net and gross sales so you can create accurate sales forecasts. Well walk you through the formulas, outline their differences and show you how to identify issues or opportunities within the sales process.Calculating your gross sales vs. net sales Lets start by clarifying the formulas for calculating your gross and net sales. How to calculate gross sales Gross sales is the total amount of sales without any deductions. To calculate your gross sales, simply multiply the number of units youve sold by the unit price. So, if you sold 200 units in Q1 and the unit price is $40, your gross sales revenue (also called gross profit) is $8,000 for that quarter.Gross sales formula:Gross sales = Number of units (gross sales price) x Unit price/costHow to calculate your net sales Net sales is the sum of your gross sales minus any deductions, such as discounts, returns and allowances (well look at these deductions in more detail later). The closer your net sales are to your gross sales, the higher your profit margin.Net sales formula:Gross sales = Number of units (gross sales price) x Unit price/cost As all the deductions have to be made retroactively, you can only calculate your net sales at the end of the sales period.How to add gross and net sales on an income statement Gross sales and net sales will feature in your financial statements, specifically as the top line on the companys income statement (also known as a profit and loss statement). A business might start by declaring its gross sales (commonly referred to as gross profit or total gross revenue), then listing the different sales deductions made as line items (which are the net sales). Other companies skip the part of identifying the gross sales and deductions and simply list the net income or net revenue. If the deductions arent on the income statement, youll find them in your companys contra accounts (an account used in a general ledger to offset the balance of a related account). When the income statement is finished, you can use this information to calculate your sales tax and inform your future sales activity.How do deductions fit into the equation? There are three specific types of deductions to consider when it comes to gross vs. net sales: discounts, returns and allowances. Gross sales incorporate all of these deductions, while net sales are a companys gross sales minus these three deductions. Lets look at them in more detail. Discounts Sales discounts apply to any early payment discounts which are offered to customers when they pay an invoice within a specified period. For example, your company might send a customer an invoice for $10,000 to be paid within 30 days. However, you could offer a sales discount of 1% off if they pay within 10 days (this particular offer would be known as a 1/10 net 30 in discount terms). In that case, the customer would only pay $9,900, getting a $100 discount for early payment in that specific period. The exact terms of a discount vary from company to company, but the general idea is to create a mutually beneficial outcome for both parties. The seller gets their invoices paid faster, allowing them to maintain a healthy cash flow, and the customer doesnt have to pay full selling price. In this context, sales discounts doesnt refer to sales promotions, promotional discounts or rebates and seasonal offers, it only applies to the early payment discount. Returns Sales returns allow customers

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Are you looking to improve your revenue analysis and decision-making for your business? Calculating gross sales is a crucial starting point. But what exactly are gross sales, how do they differ from net sales, and how can you use them to your advantage? This comprehensive guide will explore the answers to these questions and provide practical examples and insights into mastering gross sales calculations. Gross sales refers to the total revenue generated from all sales of a business prior to any deductions. This is the raw number, untouched by discounts, returns, or any other costs. In a B2C context, gross sales refer to the amount of money a business earns from selling its products or services without factoring in any costs incurred during business operations. For example, if you sold 1000 t-shirts at $20 each, your gross sales would simply be $20,000. In a B2B scenario, the calculation may involve more complexity. B2B transactions often involve larger volumes and contractual agreements, which can include bulk discounts and payment terms. Therefore, gross sales is the total amount invoiced to other businesses before any adjustments. Gross Sales vs. Net Sales: Unveiling the Difference Gross sales doesnt take into account any expenses or costs associated with running the business. Hence, when evaluating a businesss financial health, you should consider other metrics like net sales. Net sales represent the revenue after certain deductions. These deductions can include costs of goods sold, returns, allowances, and discounts. Simply put, net sales show whats left after deducting sales-related expenses from gross sales. The terms gross profit and net profit take this a step further. Gross profit is gross sales minus the cost of goods sold. Its the profit made after subtracting the cost of creating the product but before operational costs. Net profit, however, is the bottom line. Its the profit remaining after all costs, taxes, and expenses have been deducted from net sales. As a business owner, you should understand the difference between gross sales and net sales, as well as gross profit and net profit. By analyzing these metrics, you can accurately assess your companys performance and make informed decisions to improve profitability. The Gross Sales Formula: Unlocking the Calculation For Business With One Revenue Stream If youre running a business with only one revenue stream, the gross sales formula is quite straightforward: Gross Sales = Units Sold x Sale Price. This formula involves two components: the number of units sold and the sale price per unit. Lets break it down. Units sold represent the total number of products or services your business has sold within a specific period. It helps you understand the total market demand your business is meeting. Accurate tracking and data collection of units sold is essential to ensure your gross sales calculation is as precise as possible. Sale price signifies the amount charged to the customer for each unit sold. This value can fluctuate depending on discounts, promotions, and other price-altering factors. Its crucial to keep these in mind when calculating your gross sales. For example, if your business sold 100 product units at $20 each, your gross sales would be $2,000. This figure provides an initial overview of your revenue before any deductions like discounts, returns, and taxes are considered. For Business With Multiple Revenue Streams When a business has multiple revenue streams, calculating gross sales can be slightly more complex. Youll need to determine the gross sales for each revenue stream individually and then sum them up to obtain the total gross sales. The formula for calculating gross sales with multiple revenue streams is as follows: Total Gross Sales = Gross Sales of Revenue Stream 1 + Gross Sales of Revenue Stream 2 + + Gross Sales of Revenue Stream n For instance, suppose a software company generates revenue from two distinct sources: software licenses and consul

revenuegrid.com

When running a business, keeping an eye on revenue and sales is essential. In the retail industry, one of the most important metrics to pay attention to is your gross sales. Because running a retail business requires a lot of overheadthe cost of goods sold, website management, and shipping, as well as rent and utilities for brick-and-mortar storesknowing your gross sales is key to staying afloat. This article will discuss gross sales, how they are calculated, and what they can tell you about your business. How to calculate gross sales The formula to calculate gross sales is Total Units Sold x Original Sale Price = Gross Sales. A company's gross sales are the total sales of all its products and/or services over a period of time. Known as top-line sales, the number represents the total revenue of a business without deductions, returns, or allowances. Gross sales vs. net sales Now that we know what gross sales are, let's talk about its cousin, net sales. Together, these metrics give business owners a bird's-eye view of their business's progress. Gross sales shows the companys total revenue, whereas the net sales show its overall profit. Gross sales formula You can calculate your gross sales by using the following formula: Total Units Sold x Original Sale Price = Gross Sales There should be no discounts, allowances, or returns included in this figure. The purpose is to get a sense of the overall revenue of your business within a selected period of time. For example, to know how your business is doing in a given month, you might examine both monthly and yearly gross sales. Net sales formula Using the following formula, you can determine your net sales: Gross Sales - Discounts - Allowances - Returns = Net Sales You'll be deducting these three items from your gross income: Discounts for early payment of invoices on wholesale orders: Promotional or sales discounts are excluded. Sales allowances: Also known as rebates, these are reduced sales prices due to faulty products. Products might be put on clearance if defects have been detected in-store, but this also applies to when customers return defective products. If they decide to keep the product, you can refund a portion of the purchase price, or they can return the entire order. Refunds and returns: This includes any product returns. The customer may have been disappointed due to product quality, shipping delays, incorrect items received, or the product not being what they were expecting. You can use the net sales or net income to calculate your company's profit. Gross sales are equal to the sum of all sales, while net sales subtract all discounts, allowances, and returns to calculate your company's profit. Understanding both numbers is crucial to your financial statements. Gross sales, however, gives you a clear picture of how your business is performing overall and how many sales transactions are actually taking place. Stay on top of your finances With Shopify POS, its easy to create reports and review your finances including sales, returns, taxes, payments, and more. View your financial data for all sales channels from the same easy-to-understand back office. Understanding the gross sales formula You've already learned the basic formula for gross sales, but let's dive deeper into it so you know exactly how to calculate it. To begin, you need to decide what time period you want to measure. If you are looking at Q1 of 2022, then you will gather all sales made during those three months (January through March). Consider only the original sales price when calculating your gross sales. Disregard any discount or promotion you were running. Find your exact sales numbers by logging into your POS system or online sales dashboard. In order to track progress, it's smart to keep track of this in a separate spreadsheet as well. If your POS dashboard includes discounts and allowances, it might already calculate net sales for you, so you'll need to figure that out on your own. Calculate the exac

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Based on the information above, provide a projected 2024 profit and loss for Soap Box Laundromat located at 1344 Main Street, Stratford, CT 06615. The projected gross sales amount for 2024 is $305,237 for the year.

To create a projected profit and loss statement for the Soap Box Laundromat in 2024, based on the provided gross sales amount, further details are needed. The information required to calculate the profit and loss statement includes the total cost of goods sold (variable costs), fixed operating expenses, any other income or expenses, and taxes. Unfortunately, the data provided doesn't include these specific details. If you have the additional financial information required to create a projected profit and loss statement, I'd be happy to assist in its preparation.

ATTENTION Investors... Available for the first time in +/- 20 years, this +/- 2,455 square foot free-standing building located on the corner of Main Street and Minor Cross Street in Stratford. The well-established Soap Box Laundromat includes 39 self-serve gas dryers and 27 washers as well as a consistent wash & fold business from local customers. Recent updates include: asphalt shingle roof (2019), HVAC (2019) and 400-amp electric service (2018). Lower level provides extra square footage for offices and storage. Additional income is received from an outdoor ATM lease agreement for $1,800/month. Real Estate and equipment are included in the sale. MLS# 170575783 Date Listed06/09/2023 Days on Realty 160 Days Bedrooms 0 Bathrooms Lot Size 0.48 acres (20,909 sq. ft) Sewer Public Sewer Connected Property Type Business Opportunities County Fairfield Year Built 1969 Water Public Water Connected Square Feet 2,455 sq. ft Price Per Sq. Ft $366.6 Interior Features Cooling Central Air, Ceiling Fan(s) Heating Gas Heat Exterior / Lot Features Roof Asphalt, Shingle Lot Size Acres 0.48 Lot Size SQFT 20,908.80 Lot Features Corner Lot Tax Amount $16,788 Terms Cash, Conventional, FHA, VA Loan Date Event Price 08/09/2023 Pending $900,000.00 06/27/2023 Contingent $900,000.00 06/10/2023 Active $900,000.00 Street Address Beds Baths Sold Date List Price Valuation Date Valuation Price 125 Parrot Avenue |Listing 2 2 Oct 31, 2023 $427,190 Feb 26, 2023 $309,000 15 Oakdale Street |Listing 4 3 Oct 26, 2023 $749,999 Feb 15, 2023 $432,700 105 Duane Place |Listing 3 2 Oct 30, 2023 $279,900 Feb 15, 2023 $341,600 550 Harvard Avenue |Listing 2 1 Oct 26, 2023 $275,000 Dec 12, 2022 $315,300 164 Virginia Avenue #D |Listing 1 1 Nov 08, 2023 $109,000 Aug 12, 2022 $328,100 100 Boston Terrace 3 2 Oct 26, 2023 $299,999 Nov 16, 2023 - 235 Garibaldi Avenue |Listing 3 2 Nov 07, 2023 $380,000 Feb 15, 2023 $325,300 405 Jane Street |Listing 4 1 Oct 20, 2023 $247,500 Feb 15, 2023 $218,600 207 Hillcrest Road |Listing 3 2 Oct 31, 2023 $279,500 Feb 15, 2023 $273,700 47 Harbour View Place #47 |Listing 2 3 Oct 15, 2023 $639,900 Feb 15, 2023 $491,700 Zip City County National Population 18,538 52,118 960,427 335,858,263 Population Density 2,901 2,981 1,537 95 People per Household 2.6 2.5 2.7 2.6 Median Age 41.6 44.4 42 39.1 Median Income $69,078 $80,747 $98,899 $66,222 Average Income $34,329 $39,386 $58,529 $35,475 Cost of Living Index 122 124 135 100 Zip City County National January Avg. High Temp 22.9F 22.9F 18.8F 22.6F July Avg. High Temp 81.9F 81.9F 84.2F 86.2F Annual Precipitation 44.15" 44.15" 51.7" 38" ... 67/100 Somewhat Walkable Walk Score 0/100 Minimal Transit Transit Score 53/100 Bikable Bike Score Overview Some errands can be accomplished on foot. It is possible to get on a bus. Some bike infrastructure. Walkability averages in the surrounding area The average walkability score in the surrounding area is Walk Score: 35/100, Transit Score: 7/100, Bike Score: 36/100.

realty.com

1344 Main St 5,394 SF Retail Building Stratford, CT $900,000 ($167/SF) Investment Highlights This well located corner-lot property is an established laundry facility featuring a plethora of recent improvements. Executive Summary ATTENTION Investors... Available for the first time in +/- 20 years, this +/- 2,455 square foot free-standing building located on the corner of Main Street and Minor Cross Street in Stratford. The well-established Soap Box Laundromat includes 39 self-serve gas dryers and 29 washers as well as a consistent wash & fold business from local customers. Recent updates include: asphalt shingle roof (2019), HVAC (2019) and 400-amp electric service (2018). Lower level provides extra square footage for offices and storage. Additional income is received from an outdoor ATM lease agreement for $1,800/month. Real Estate and equipment are included in the sale. Property Facts Under Contract Zoning RM-1 - Residential medium-density PROPERTY TAXES Parcel Number STRA-000406-000004-000014 Improvements Assessment $238,980 Land Assessment $178,640 Total Assessment $417,620 PROPERTY TAXES Parcel Number STRA-000406-000004-000014 Land Assessment $178,640 Improvements Assessment $238,980 Total Assessment $417,620 Listing ID: 28729311 Date Created: 6/12/2023 Last Updated: Address: 1344 Main St, Stratford, CT The LoopNet service and information provided therein, while believed to be accurate, are provided "as is". LoopNet disclaims any and all representations, warranties, or guarantees of any kind. SBL 001 SBL 002 SBL 003 SBL 004 SBL 005 SBL 006 SBL 007 SBL 008 SBL 009 SBL 010 SBL 011 SBL 012 SBL 013 SBL 014 SBL 015 SBL 016 SBL 017 SBL 018 SBL 019 SBL 020 Presented by (203) 878-7424 x 1344 Main St Hmm, there seems to have been an error sending your message. Please try again. Thanks! Your message was sent. Share Link

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Soap Box LaundromatBusiness ContactBusiness DescriptionSoap Box Laundromat is located in Stratford, Connecticut, and was founded in 1996. This business is working in the following industry: Laundry. Annual sales for Soap Box Laundromat are around USD 500,000.Employees:1-4Revenue:USD 500,000Founded:1996IndustryLocal Services LaundryEngaged in:Washing and (dry-) cleaning of textile and fur productsISIC Codes9601NAICS Codes8123Questions & AnswersQ1How long has Soap Box Laundromat been in business?Soap Box Laundromat has been in business for around 28 years.Q2What is the phone number for Soap Box Laundromat?The phone number for Soap Box Laundromat is (203) 380-2966.Q3What days are Soap Box Laundromat open?Soap Box Laundromat is open MonSat 7 AM10 PM; closed Sun.Q4Where is Soap Box Laundromat located?Soap Box Laundromat is located at 1344 Main St, Stratford, CT 06615, United States.Q5Is there a primary contact for Soap Box Laundromat?Gileert K. Chun (Owner) at Soap Box Laundromat.Q6Are there other contacts associated with Soap Box Laundromat?We have 2 additional contact(s) for Soap Box Laundromat. They include: Lee Michael & Michelle Chun.Q8What are the annual sales for Soap Box Laundromat?Soap Box Laundromat has annual sales of approximately USD 500,000.Employee DirectoryNamePositionGileert K. ChunOwnerLee MichaelOwnerMichelle ChunAdditional Businesses at this Address1344 Main St, Stratford, CT 06615, United StatesSimilar Companies NearbyBusinesses in Zip Code 06615Businesses in 06615:1,781Population:18,493CategoriesProfessional Services: 13%PriceArea CodesNeighborhoodsBrooklawn - St. Vincent: 15%Stratford Center Historic District: 19%Stats and Demographics for Zip Code 06615RaceBlack Or African American: 20%American Indian Or Alaskan Native: 0%GenderBusiness Lookup

allbiz.com

Give me a proforma profit and loss for the laundromat above based on gross sales of $305,237 for the year in gross sales

I'm able to assist you with creating a proforma profit and loss statement based on the provided gross sales figure.

To proceed, it's essential to have specific details about the business's total of goods sold, including material and labor costs, as well as other operating expenses such as rent, utilities, payroll, and any other income or expenses.

Unfortunately, the information you provided is insufficient for generating a complete proforma profit and loss statement. If you can provide more detailed financial data, including expenses and other relevant information, I'd be more than happy to help you create the statement you need.

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hklaundry.com

Starting and running a successful laundry business requires more than just having a cool branding and providing a good service, it also requires a solid financial plan that can guide the business through its early stages and help it grow and thrive over time. A financial plan is a crucial tool for any business owner, and its especially important for a laundry project where the costs of equipment, utilities, and labor can add up quickly. In this article, we will discuss the benefits of building a detailed financial plan for your laundry venture, including forecasting costs and revenue and understanding the financial position of the business by projecting the income statement, cash flow statement and balance sheet. Armed with this information, laundry business owners can make informed decisions on how to best invest their funds, manage costs and grow revenue, ultimately leading to long-term success. Laundry Financial Plan Template in Excel Before we dive in our article, we would like to introduce you to our automatic laundry financial plan template in Excel. This spreadsheet has been carefully prepared by our expert business planners and can be used to build a solid laundry financial plan in record time. It comes as part of our ready-made laundry business plan package that also includes a pre-written business plan in Word tailored to the laundry industry. Now, lets crack on! Laundry Financial Plan: Cost Forecast The first step in planning your laundry financials entails understanding the costs involved in such a project. The cost forecast outlines the projected costs of running the laundry over a certain period of time, typically a year. These costs can be broken down into several categories such as: Fixed costs: For a laundry business, fixed costs usually include rent, insurance and employee salaries. These costs do not change with the level of business activity and must be paid regardless of whether the laundry is generating revenue or not. Variable costs: These include the cost of consumables and supplies such as detergent, bleach and water, as well as the cost of utilities such as electricity and gas bills. The more services the business provides, the higher these variable costs will be. Semi-variable costs: These costs have both a fixed and a variable component. For example, equipment lease payments may have a fixed portion and a variable portion based on usage. Maintenance costs may also have a fixed portion for regular maintenance fees and a variable portion for major repairs or replacements. Capital expenditures: A laundry business involves acquiring long-term assets such as washing machines, dryers and other equipment. These investments can be substantial and may need to be financed over time. More on that in the next section. Its also important to note that in addition to the above costs, a laundry business may also have other running costs such as marketing, advertising, legal and accounting fees. These are also part of your laundrys operating costs also called Opex. When creating a cost forecast, its important to use accurate and up-to-date data to make informed estimates. For instance, if you are forecasting the utilities expenses, you should use the most recent bills and rate information available. If you are forecasting the cost of supplies, you should use current pricing data and take into account any expected changes in the cost of materials as well as inflation. Laundry Capital Expenditures Capital expenditures, or CapEx for short, refer to the funds a business uses to acquire or improve long-term assets such as equipment, vehicles, or real estate. They are usually capitalized rather than expensed. However, your accountant will depreciate them over the lifetime of the assets and this will incur a charge on the Profit and Loss statement as we will see later on. For a laundry business, some examples of capital expenditures include: Laundry equipment: Equipment such as washing machines, dryers, and presses are a

businessandplans.com

You are an expert financial advisor for laundromats. Give me a profit and loss statement with estimates based on the gross sales above.

Certainly, using average estimated percentages for laundry businesses, I can provide a proforma or projected profit and loss statement for Soap Box Laundromat. Here's a sample breakdown for 2024:

  1. Gross Sales: $305,237 (100%)

Cost of Goods Sold: Assuming the primary cost in a laundromat business is utilities (water, electricity, gas which can reach up to 26% of the gross sales.

  1. Utilities (percentages can vary but we will use 26% as an estimate): $79,362 (.26 * $305,237)

Gross Profit: Gross Sales - Cost of Goods Sold

  1. Gross Profit: $225,875 ($305,237 - $79,362)

Operating Expenses: We shall go with industry averages here. These percentages can change vary by regional costs and specific business practices.

  1. Rent (assuming around 20% of gross sales): $61,047
  2. Payroll (approx. 15% of gross sales): $45,785
  3. Maintenance (approx. 5% of gross sales): $15,262
  4. Office Supplies, trash, others (lets assume 5%): $15,262
  5. Insurance, liability, and workers comp (around 2%): $6,105
  6. Professional fees, licenses, taxes (about 2%): $6,105 . Advertising, promo, printing (assuming 1%): $3,052

Total Operating Expenses: ($61,047 + $45,785 + $15,262 + $15,262 + $6,105 + $6,105 + $3,052) = $152,618

Net Operating Income: Gross Profit - Total Operating Expenses

  1. Net Operating Income: $73,257 ($225,875 - $152,618)

Assuming no other income or expenses,

  1. Net Income Before Tax: $73,257

Please note that these are estimated values and may not precisely reflect the actual costs for Soap Box Laundromat. Each business has unique expenses and cost structures that influence their financial performance. Ideally, you should tailor these figures your laundromat's exact costs and operations for the most accurate profit and loss statement.

Article Summary: People patronize laundry businesses out of both convenience and necessity. The median cost to open a laundromat from the ground up is approximately $1.2 million, and you can expect to pay a similar price for an existing laundry business. Operational costs average about $15,000 per month, but the good news is that laundromats can be very profitable. Everyone needs to do laundry! For people who dont have the luxury of a private washer and dryer, a local laundromat is a necessity. Laundromat business owners know that there will always be a need for their services, which explains why the laundromat industry is worth about $5 billion in the United States. Maybe you want to take on a new business venture as a laundromat owner, but how much does it cost to open a laundromat? In this article, well go over the costs to open and operate your own laundry business. How to start a laundromat business Starting a laundromat business can be a big undertaking, but it can also be so rewarding! Youll have the satisfaction of being your own boss while providing value to your local community. If youre wondering whether a laundry business can be profitable, the good news is that the laundromat industry sees about a 95% success rate. To get your laundromat business started, follow these steps: Choose your business model: Decide if you want to buy an existing laundromat or franchise or if you want to start from scratch. Youll also have to decide what kind of laundromat you want to operate. This includes choosing your operating hours, equipment, and service offerings. Set up your business: Setting up your business includes writing a business plan, registering your business, getting business licenses and permits, purchasing a business insurance plan, setting up a business bank account, and financing the business. Select a great location: Location is everything for a laundromat. In fact, 87% of laundromat customers live within one mile of their preferred laundromat. Low-income apartment renters are the most common patrons of laundromats. Consider potential locations within a mile of several apartment buildings. Also consider your potential competition before settling on a location. Buy or build your laundromat: Buy an existing laundromat or acquire the property to build your own. Then start connecting utilities, installing equipment, and preparing the business for opening day. Market your laundromat business: Make sure all the locals know about your new laundromat. Start with attractive signage and a great website. Use channels such as social media, newspapers, and TV to market the laundromat to your target customers. Provide great customer service and stay on top of maintenance: Gain new and returning customers by providing great service and keeping your business in good condition. Start-up costs of a laundromat business Starting any business always requires an initial investment. The investment youll make in a laundromat depends on your business model. If you decide to start a laundromat from the ground up, you can expect to face the following costs: Property Real estate is the most important and likely the most expensive cost associated with opening a laundromat. Location can make or break your laundromat business. The cost of a property depends on its size and location, as well as the surrounding businesses. Laundromat spaces typically range from 1,000 to 5,000 square feet, and you can expect to pay more for prime locations for example, property in downtown Los Angeles will cost far more than property in Terre Haute, Indiana. This cost also depends on whether you decide to buy or rent the property. Renting is a great choice for business owners with less available capital to invest up front. If you have the capital and you want to plant roots in your community long-term, buying a property for your laundromat is worth the investment. Considering the high variability of this cost component, it is estimated that purchasing a laundro

supermoney.com

by Randy Dobbins | Blog I clearly remember making that first phone call to the listing broker about the laundromat in our neighborhood. I was nervous, rehearsing what I was going to say, oddly wishing that it would go to voicemail. As I heard it ringing on the other end, and battled between letting it continue to ring and hanging up, I kept telling myself Youll regret the things youdidntdo more than the things youdiddo. So I let the phone ring and just as Id hoped, it went to voicemail. I left a brief message explaining who I was and that I was interested in getting more information about a local laundry that was for sale. But I wasnt always that brave. It was 2014, and for years, my wife and I had been restless. Tired of the 9-to-5, tired of just moving along lifes path. We knew we were capable of more. It felt like the right time to change things up, but we had no idea what or how. We soon realized owning a business could be the game-changer we were looking for. But we were worried about taking that first step; our minds were filled with anxiety and self-doubt. We looked at various businesses from all different industries, and after some extensive research, landed on just the right thing. We wanted to own a laundromat. [Spoiler alert: Our first store did so well, we bought a second one! If you want to follow exactly what we did, check out our how-to guide HERE.] Heres why we were so intrigued 8 Reasons Why a Laundromat Was the Right Business for Us: 1. Cash Flow Even a small location can earn several thousand dollars profit each month. 2. Increased Asset Value As business income increases, so does the value of the business itself. 3. Passivity and Minimal Cash Investment Laundromats require a much lower cash investment than almost any other business, and they can be operated relatively passively in just a few hours per week. 4. Quick Equity Business loans are typically just 5-year terms, so equity builds very rapidly. 5. Easy Financing Even first-time owners can obtain a purchase loan relatively easily, and many sellers are open to carrying the financing themselves. 6. Financing is Self-Supported The monthly payments for the purchase loan are paid by the business itself. 7. Significant Cash Out Value Due to the rapid building of equity in the business, in just a few years the business will be owned free and clear and can be sold for a very nice sum. 8. Its an Essential business People have to do laundry, no matter what the economy is doing. (In fact, during the COVID-19 quarantine, our laundromats remained open while other small businesses had to close. Laundry is a necessity!) Our Target Store We decided up front that we were comfortable investing no more than $50,000 into a business venture. So we started looking around at laundromats for sale. One was too far away, another the seller seemed sketchy. Then we found it. And we couldnt believe the coincidence. The unattended laundromat in our neighborhood shopping center was up for sale. And they had just lowered the price from $150,000. The new list price was $129,500. (Hmmma motivated seller?) But we had agreed to only invest $50,000 of our cash into a business venture. So we knew wed have to get the rest through financing; either an acquisition loan or perhaps even the seller would be willing to carry the financing? We werent sure. So I made that fated phone call I mentioned earlier, asking the listing broker for more information. He called me back, and we arranged to meet at the laundry the next day to go over more details. We walked into the laundry that next afternoon, and knew we had a diamond in the rough on our hands. It needed a major cosmetic overhaul, but the customer base was solid, and the incomes were consistent. But we had some work to do before we made our move. What purchase price were we comfortable with? And if the seller is as motivated as he seems, would he accept an offer below asking? Lets Dig In tothe Numbers, Shall We? We ran some valuatio

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Laundromats can be a great business for an entrepreneur or investor to get into. With the lure of relative simplicity, consistent cash flow, a high return on investment, and time flexibility, laundromats are incredibly attractive businesses. The two largest barriers to entry into the laundry business are a lack of knowledge and their high cost. Youre here remedying the lack of knowledge, so that just leaves the cost of buying or starting a laundromat business. So, how much does a laundromat cost?The typical laundromat costs between $250,000-$500,000, however laundromats can be purchased between $20,000-$1 million+. Loans can be utilized to reduce the initial start-up costs of buying a laundromat, making it more affordable to acquire a laundry business. How Laundromats Are Valued In order to understand how much a laundromat costs, you need to understand how they are valued. Lets explore that first. Then, Ill show you how the variables involved in calculating a laundromats value each affect the cost of the laundromat. Finally, Ill give you some options to reduce the high up-front costs of buying a laundromat.When you start researching buying a business, youll hear something along the lines of Buy on performance, not on potential being thrown around. I want to define precisely what that means for you. When we talk about performance we are referring to a very particular number. This number is called the net operating income (NOI). The NOI is derived from a simple mathematical formula: Gross (total) Income Expenses (before loan payments and taxes) = net operating income The value of a laundromat, and therefore its cost, is based on this NOI number. In order to determine the value of a laundromat from that number, a multiple is applied to the NOI. The average multiple that is applied to the net operating income to determine the value of a laundromat is 3.5-5 times. In a hot market, those numbers may skew a little higher. In a cold market, those numbers may skew a little lower.The simple equation to determine the value of a laundromat, then, is: Net Operating Income * Multiple = Value of Laundromat How to Determine a Laundromat's Multiple Since the multiple will lay somewhere on a spectrum, we 3 main pieces of information about the laundromat to help us determine what the multiple should be. There is more that goes into fine tuning the multiple, but the multiple can be determined with surprising accuracy with 3 pieces of information.The age and condition of the machinesThe length of time remaining on the leaseThe lease amount as a percentage of the gross income Age and Condition of the Machines Newer equipment is obviously more valuable than older equipment. Therefore, newer equipment will command a higher multiple. To give some rough estimations for you, equipment that is 0-5 years old will be around the 5x multiple range. Equipment that is 6-9 years old will be around a 4.5x multiple. Equipment that is 10-12 years old will around a 4x multiple. And older will command a 3.5x or lower.These are just approximations to give you an idea of how machine age and condition will affect the value of a laundromat. Length of Time Remaining on the Lease Lease length is critical to the value of a laundromat. If the lease is too short then the laundromat is at risk because it is difficult and expensive to move a laundromat if a lease is not renewed or is unreasonably raised. Its important that you have enough time to recoup your initial investment and to sufficiently profit in order to make owning a laundromat worth it.By way of giving you approximations again to help you determine how lease length affects the multiple, let me give you some benchmarks. Again, these are approximations.A lease with 15+ years remaining on it will be around that 5x multiple. 12-15 years commands around a 4.5x multiple. And 10-12 years warrants around a 4x multiple. Less than 10 years is not advisable but could fetch a multiple of 3.5 or less. Lease Amount Your rent

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