Setting Up A Commercial Laundry Business
Whilst it may seem a daunting task to start with, setting up a commercial laundry business is not that hard provided that you can get the financing in place to get going. However whilst they are not cheap to set up, many banks class them as a safe investment and are willing to lend finance to set them up, particularly given the 20-30% profit that they can make. Thus making them a reasonably safe investment for the bank.
Obviously this will mean having to pass the usual credit checks etc. However they will primarily be interested in your business plan and how much operating capital you will need - This is the money you will need to pay staff and suppliers until you get cash flowing in to the business from customers, rather than the money need to buy the commercial laundry equipment.
When it comes to premises you have a wide range of options, as you will be picking up and delivering your customers laundry it does not matter where you are located within reason. This means that you should be able to source premises that are cheap to rent, which is important as a commercial laundry can need a lot of space for drying and storage of washed items, as well as items waiting to be washed. You will also need some office space, although this will be minimal compared to the laundry part of the business.
When it comes to the financing for your commercial laundry business then you have two main options, outright purchase of the equipment, or leasing it. Whilst if you have the cash to buy it outright this may seem an attractive option, however leasing it may prove to be far more cost effective for a couple of reasons.
Firstly by leasing the equipment you will get the chance to replace it with newer more efficient machines every 3 to 5 years, and secondly you are likely to be offered a comprehensive support and maintenance package with the lease. This can be vital as every hour that a machine is broken, you are losing business or customers.
A good maintenance package is essential to any commercial laundry business, whereas if you buy the equipment outright then you will have to set up separate agreements to cover this.
The key thing to setting up a commercial laundry is knowing your market and drafting a good business plan, do this right and the finance should drop into place.
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