In this article
What is a Laundry Business?
There are more than 5,000 laundry businesses currently operating in the UK. However, in the 1980s, there were three times this number, with a laundrette on every high street. Although laundry businesses have declined in popularity in recent decades, they are making a resurgence, with more and more people using a laundry business for their general laundry needs, or for cleaning delicate or bulky items.
If you are thinking about starting up a laundry business, the first consideration you will need to make is the type of business you want to set up. There are several different types of laundry businesses, and you will likely make your decision based on factors such as your local competition and demand for your services, your equipment and your experience.
Different laundry businesses have different start-up and running costs and different customer pricing.
The most popular types of laundry businesses are:
A laundromat is an establishment that has washing machines and tumble dryers available for public use. Laundromats can be full-service, staffed establishments where staff assist customers with the washing and drying of their clothes or they can be unattended, self-service establishments where customers are responsible for using the machines themselves. In this type of establishment, the machines are coin-operated or automatically card operated so that no staff are required. In a laundromat, all clothes are washed and dried by machines, rather than hand-washed.
Dry cleaning is a specialised method of cleaning clothes and other fabrics without water, to avoid stretching or shrinkage. Dry cleaning uses non-water-based chemical solvents to clean the surface of the material. It can be more effective at removing dirt and stains, whilst simultaneously protecting your fabrics. Dry cleaning is particularly popular for delicate garments and fabrics, such as silk, leather, suede, velvet and cashmere. It is also popular for clothing items, such as:
|Wedding dresses||Occasion wear||Sequined/beaded clothing|
|Discoloured or stained clothing||Home furnishings, e.g. curtains||Embroidered clothing|
This is a more environmentally friendly and cost-effective method of washing delicate garments and materials. Water is used as a solvent to clean the fabrics without mechanical action (e.g. the use of a washing machine) and at a lower temperature. Because wet cleaning is a less well-known method of cleaning clothes, laundry businesses that offer this service usually do so alongside other laundry services.
Wash, iron and fold
This type of laundry business is more popular with customers who don’t have time to wash, dry, iron and fold their clothes. This type of business may offer a pick-up and drop-off service to make the service more convenient for customers.
Because laundrettes are making a comeback and are becoming more popular with a younger demographic (such as students) and busy professionals, many laundry businesses have taken steps to make their business more appealing to a wider variety of customers. For example, they may offer free Wi-Fi, a seating area and snacks or coffee. Some laundry businesses are also attached to cafés, coffee bars or shops.
The responsibilities associated with a laundry business can vary depending on the type of laundry business you set up. Some of the typical responsibilities you can expect are:
- Purchasing, cleaning and maintaining equipment and machinery.
- Cleaning and drying garments and other fabrics.
- Ensuring your business complies with all safety regulations, including fire safety and electrical safety.
- Pricing your services.
- Marketing and advertising.
- Handling quotes and customer payments and preparing invoices.
- Completing business and administrative tasks.
Starting up a laundry business can be rewarding in many different ways. This type of business requires no qualifications and (depending on the type of laundry business) very little experience. However, if you opt to set up a business such as a dry cleaner, you will need to have knowledge and experience with delicate fabrics and expensive materials.
A love for cleaning, good marketing and advertising skills and a flair for business can be beneficial in helping your business succeed.
Types of Customers
The types of customers your business will attract can be dependent on multiple factors, including:
The type of laundry business you set up
This will be the most important factor when determining your typical customer base. People are usually looking for a specific type of laundry business, for example a dry cleaner, and a different type of laundry business will likely not appeal to them. Consider the type of laundry business you plan to set up and who is likely to use your services when setting up your business. For example, a wash, iron and fold laundry business is more likely to attract busy working professionals and a self-service laundry business may be more likely to attract students.
People tend to use a laundry service that is located conveniently for them. People are likely to choose a laundry business that is located close to their home, work or place of study. For example, a city centre location may be likely to attract professionals who work in the area whereas a laundry business located near a university is more likely to attract students. Consider your location when determining your typical customer base.
Your pricing policy
This will be a key factor in determining your typical customers. As with other businesses, laundry businesses can attract budget, mid-range and high-end customers who will have different budgets and different expectations of the service you offer.
Your branding, marketing and advertising
How you opt to advertise and market your business can impact the potential clients you reach. Your business name and logo, the aesthetic and design of your business and the design of your website or physical location can also impact your typical clients.
Once you have determined who your typical customer base is, you can then decide how best to target them. You will need to gather information and insights into your clients. You can do this via multiple sources, including social media.
Equipment You Will Need
The type of equipment you require will depend on the type of laundry business you set up. Equipment and machinery are essential purchases, as without them you will not be able to operate your laundry business.
Although your equipment requirements can vary, below is a list of equipment typically required by laundry businesses.
Domestic washing machines are usually not suitable for laundry businesses, as they are less durable and often cannot handle excessive use. You will, therefore, need to purchase a commercial machine. You may opt for industrial-sized washing machines that typically have a load capacity of between 10kg and 100kg or standard-sized washing machines, which typically have a capacity of between 5kg and 10kg. To save money on your water and energy bills, choose machines that are efficient and eco-friendly. If you are opening a self-service laundry business, you may opt for coin-operated washing machines. Choose the number of machines based on the size of your premises.
Purchasing commercial dryers is recommended to ensure they are reliable and durable and to ensure they can cope with constant use. It is recommended that you purchase the same number of washing machines as dryers, and opt for dryers that have the same load capacities as your washing machines.
If you offer a dry cleaning service, you will need a variety of different cleaning chemicals to treat the fabrics. These could include chemicals such as PERC, glycol ethers, hydrocarbon and liquid silicone. Consider the pros and cons of the different cleaning chemicals and make the best decision for your business.
Steam pressing machine
This is a piece of equipment that uses heat and steam to remove wrinkles from clothes. They are recommended over a traditional iron as the pressing plate is approximately 10 times larger than an iron, meaning it removes wrinkles more quickly and allows you to press larger items.
A steamer is a hand-held device that uses hot steam to remove wrinkles from clothes. A steamer removes the risk of scorching, burning or damaging fabric so is recommended for delicate fabrics, such as silk, velvet and satin. Steamers are also recommended for expensive items, such as wedding dresses.
A garment conveyor
This is a transport, sorting and storage system that can be used to move around and store high volumes of hanging garments at one time. They can be freestanding so that you can move them around, or stationary.
Each tag should include the customer’s information and the garment information and will be kept with the garments throughout the dry cleaning or laundering process. This ensures each garment is returned to the correct customer. You could opt for information tags that have a tear-off portion that is given to the customer.
You may choose to hang garments on clothing racks to make them easily accessible or before moving them to the assembly system or the garment conveyor. Clothing racks should not be accessible to customers.
Hangers and garment coverings
Once you have laundered or dry cleaned a garment, it will need to be hung up and covered to ensure it remains wrinkle-free and is protected from any dirt or dust. The majority of laundry businesses allow customers to take the hangers and coverings with them to keep the garments protected on their journeys. This means that you will need to have a large number of these on your premises so that you never run out.
These can be used to separate white clothing from dark clothing or for keeping one customer’s garments separate from others. If you choose sorting bins with wheels, you can use these to transport clothing to the washer and from the washer to the dryer.
Laundry businesses require different products for cleaning clothing and other materials. For example:
- Laundry detergent.
- Fabric softener.
- Stain removers.
- Drying sheets.
A CCTV system
CCTV can protect your business from potential break-ins and theft. A CCTV system can cost between £300 and £5,000 depending on the specification of the equipment, how many cameras you require, and the installation costs.
Personal Protective Equipment (PPE)
If you are handling hazardous chemicals (such as cleaning chemicals and laundry detergent) and potentially dangerous equipment (such as pressers and steamers), PPE can help to protect your skin, respiratory system and overall health and safety. Some PPE that could be beneficial includes masks, gloves, aprons and long-sleeved clothing.
A cash register and Point of Sale (POS) system
This is essential for recording sales and managing the financial aspects of your business. It is recommended that you have a payment system whereby customers can pay cash, debit card or credit card for their purchases.
Reception and admin equipment
Some of the equipment you may require for your reception includes:
- A laptop or computer – for advertising, making appointments and accounting purposes.
- A phone – for customers to make appointments.
- An appointment book or scheduling software – to keep track of appointments and cancellations.
- A reception desk and chair.
- Business cards and appointment cards.
- Pricing signs and opening hours signs.
- Shelving for displaying products.
A website is useful for advertising your business. It should contain your contact information, descriptions of your services, your pricing, your location and personal information and your customer reviews. Design your website to include your business logo and to reflect your branding.
A fully stocked first aid kit
A first aid kit is a necessity, as you will be working with potentially dangerous equipment and products. Ensure your first aid kit is restocked regularly and is easily accessible.
A van or other vehicle
If you offer a delivery and pick-up service, you will need a business vehicle to complete your orders. You could also use your vehicle as a way of advertising your business, by attaching adhesive door and body panels with your business name and logo, your contact information and the services you offer.
Keeping all areas of your premises clean is imperative, particularly as different customers will be visiting your shop and you will be dealing with dirty clothing and hazardous chemicals. You will likely need different cleaning materials for different parts of your shop. You may need to invest in cloths, sponges, antibacterial surface cleaners, bleach, sanitiser and a sweeping brush and mop. You may also need to invest in specific cleaning materials for the inside of your washing machines and tumble dryers.
When you are planning your laundry business, you will need to calculate the approximate costs associated with setting up and running this type of business. Calculating your typical costs allows you to estimate your initial investment requirements, any monthly and annual costs, your pricing strategy, your profit goals and your acceptable profit margins.
There are multiple costs associated with setting up and running a laundry business. Some of these costs will be one-off initial costs that you will need to pay when you are setting up your business. Other costs will be ongoing costs you will need to pay regularly – usually weekly, monthly, quarterly or annually.
The typical costs associated with a laundry business can vary, depending on the type of laundry services you offer and the size of your premises.
The typical costs you can expect include:
Your business location will likely be your biggest expenditure. You will need to rent your premises on a monthly or annual basis. Rental prices can vary significantly, depending on the location and the size of the premises. City centre locations and newly built premises usually have the highest rental costs. Rental costs are often calculated per square metre. They can range significantly, from £500 to £15,000 per square metre annually.
Refurbishment and installation costs
Unless your premises previously operated as a laundry business, you will likely need to refurbish or convert your venue to install the equipment you need for your laundry business and make the area fit for purpose. You will also want to refurbish and decorate your premises to fit the aesthetic of your business and make it attractive to customers. Renovation costs can vary, from £500 to £20,000 depending on the level and scale of work required. As part of your renovation costs, consider how you can make your shop easy to clean and ensure it is safe and in line with health and safety regulations.
Your equipment is an important purchase, as without it you will not be able to run your business. The cost of equipment can vary based on how much equipment you require. The bigger your premises and the more customers you want to accommodate at one time, the more equipment you will require. You may choose to purchase less equipment initially and expand your equipment as your business grows. Equipment for your laundry business can cost between £5,000 and £30,000.
Maintaining, repairing and replacing equipment
Repairs, maintenance and replacements are ongoing costs you will need to factor into your budget. Although some of your equipment and machinery will come with warranties, repairs and replacements are inevitable – particularly because you will be using the equipment continuously. Correctly cleaning and maintaining equipment and ensuring it is used correctly can extend its life, but potential repairs and replacements should still be factored into your budget.
Ongoing equipment costs, such as cleaning chemicals (for dry cleaning), laundry detergent, fabric softener, hangers, garment bags and labels will need to be replenished regularly. You may choose to have an automatic, ongoing order for replenishing stock or you may order products as and when you need them. Factor the costs of your materials into your monthly and annual budgets.
These are the day-to-day costs associated with running your business. Some running costs are paid monthly, and others are paid quarterly or annually. Your running costs can include electricity, gas, water, council tax and insurance. To maximise your profits, try to keep your running costs as low as possible.
Unless you open a self-service laundry business, you may need to hire staff to help you run your business and fulfil your orders. You will need to pay any staff you employ at least the national minimum wage of £9.50 per hour and account for other expenses such as holiday pay, sick pay, maternity/paternity pay, National Insurance and any company pension contributions.
Your business website
A business website is an essential advertising tool and allows potential customers to find your services online. You should ensure your website is attractive to customers and use search engine optimisation (SEO) so that your website ranks highly on search engines, such as Google. Your website will need regular monitoring, updating and upgrading. You also need to make sure your website is secure, particularly if you will be collecting any customer information. You may choose to set up and run your website yourself or hire someone to do this for you. You can expect to pay between £20 and £100 per hour for someone to set up your website.
When creating your brand identity, consider how you want your business to be perceived by potential customers. When creating your brand, consider the type of laundry service you offer and your typical customer base. Branding can include creating your business’s visual identity, design and aesthetic, your business name and logo and your website. You could hire a professional to help you with branding or do some or all of the work yourself. Branding can cost between £500 and £10,000, depending on the level of work required.
Advertising and marketing
To ensure your laundry business attracts customers and creates maximum profits, you will need to spend money on advertising and marketing. It is recommended that you spend between 1%-3% of your annual turnover on marketing. For example, if your annual turnover (or your desired annual turnover) is £45,000, you should spend between £450 and £1,350 on advertising and marketing. You may need to invest more money when you initially set up your business or when you are trying to grow your business. To reduce your costs, capitalise on free marketing strategies, such as on social media or in your local community.
There are multiple coverage options for a laundry business, including:
- Public Liability Insurance.
- Property Insurance.
- Business Interruption Insurance.
- Employers’ Liability Insurance (if relevant).
- Legal Protection.
- Buildings Insurance.
- Tools and Equipment Cover.
- Business Contents Cover.
- Personal Accident Cover.
Typical Pricing for Customers
Once you have calculated the typical costs associated with setting up and running a laundry business, you can then determine your pricing strategy.
Some factors you should consider when determining your pricing include:
The type of laundry services you offer
Different types of laundry services have different price points and you will need to consider this when calculating your pricing. Dry cleaning services generally have the highest price points and self-service laundry businesses usually have the lowest price points.
The delicacy and value of the material
The same laundry service can have different costs depending on the materials you are working with. For example, dry cleaning silk garments will be more expensive than dry cleaning cotton garments. Certain types of garments may automatically have a higher price point, for example, wedding dresses.
Your location will also impact your price points as it will likely determine your typical customer base. Depending on your location, you may target budget, mid-range or high-end customers, with different types of customers willing to pay different prices. Consider your location and your typical customers when determining your price points.
Safely Running a Laundry Business
Safe practices in your laundry business are essential to protect the health, safety and well-being of you, your employees and your customers.
Some ways you can safely run your laundry business include:
Properly maintain and set up equipment
Any equipment you use, such as washing machines and garment conveyors, must be properly maintained, correctly set up and safe to use. You must protect yourself, your employees and your customers from accidents or injuries caused by equipment. You should also perform regular equipment inspections to ensure your equipment’s safety and help extend the lifespan of your equipment. Maintenance includes dusting, cleaning and washing equipment regularly and checking it is functioning correctly.
Check and maintain electricals, electrical outlets and plumbing
Not only can this save you money by avoiding damage, repairs and replacements, but checking and maintaining electricals and plumbing can help to protect your equipment from faults and protect the health and safety of everyone who visits your business. Implement a system for regularly checking outlets and plumbing and ensuring they are up to code.
Ensure all chemicals are stored safely
All chemicals should be stored in a cool, dark, dry place. They should be kept upright to prevent spillages and be protected from contamination. Chemicals should also be kept away from customers, ideally in a locked area.
Adhere to labelling guidelines
You must always read the instructions on the labels carefully and follow the manufacturer’s instructions. You should also pay attention to use-by and best-before dates and never use any product that is past its expiration date.
Health and safety training can help to ensure safe practices in your laundry business and can ensure that you and any staff you employ are aware of and adhere to safety procedures. Some training you can complete includes First Aid, Health and Safety for Businesses, Fire Safety Awareness, Assessing Risks and Electrical Safety.
Carry out risk assessments
Risk assessments are a legal requirement for businesses with more than five employees. However, even if your business has fewer than five employees, risk assessments are still recommended to ensure the safety of you, your staff and your customers. Risk assessments can help you to identify any potential hazards and risks in your business and how these can be reduced or eliminated.
As part of your risk assessment, you should:
- Identifying hazards.
- Determine who could be at risk.
- Evaluate any potential risks.
- Implement relevant safety measures.
- Record the results of the risk assessment.
- Review the risk assessment regularly.
Keep clear and accurate records
If your business receives an inspection, up-to-date records of your cleaning schedules, risk assessments and health and safety policies will likely be requested. Keeping such records not only helps to protect your business and improve the likelihood of you receiving a higher score in your inspection, but it also ensures procedures are followed at all times.
Implement security measures
Security measures can be implemented to protect your business. Some ways you can protect your equipment and materials include installing a CCTV system, using secure and reliable locks and installing an alarm system.
Install smoke detectors, carbon monoxide detectors and fire alarms
These should be installed throughout your premises and should be checked regularly to ensure they are working. They can protect you, your customers and your business in the event of a fire or carbon monoxide leak.
Keep a fully stocked first aid kit
If a customer or employee has an accident or injury, it may not be serious enough to warrant medical intervention. Instead, you may be able to offer treatment yourself. Having a first aid kit that is checked and replenished regularly and is easily accessible is recommended.
Use personal protective equipment (PPE)
PPE can help to protect you from potentially hazardous chemicals and equipment. Ensure PPE is used for certain tasks and that any staff your hire are aware of your PPE policy.
Implement cleaning policies and procedures
Strict cleaning procedures must be in place on your premises. This includes cleaning, disinfecting and sanitising all equipment and surfaces and cleaning up any spills or water leakage immediately to prevent any slips or falls from occurring. You should clean regularly throughout the day and perform scheduled cleaning of your machinery.
Ensure proper ventilation
Because you will be working with chemicals which can release harmful vapours, you should ensure that your premises have proper ventilation. Fresh air should be able to circulate via open windows and doors, or you may opt for artificial ventilation (e.g. an extractor or dust ventilation unit).
Complying with legal requirements is essential when setting up and running your laundry business.
Legal requirements can vary depending on:
- The type of laundry business you set up.
- The equipment and machinery you work with.
- Whether you hire any employees.
Some of the legal guidelines you should be aware of are:
Apply for an environmental permit
Many laundry businesses, particularly dry cleaners, use harmful chemicals such as perchloroethylene (PERC). These chemicals can be harmful to your health and to the environment. If you use potentially hazardous chemicals, you must apply for an environmental permit from your local council. To receive a permit, you may need to have an inspection of your premises. To comply with your permit, you must use less than one litre of PERC for every 80kg of clothes and you must keep accurate weekly, monthly and yearly records and submit these to your local council every year. Keep in mind that it can take up to three months to process your permit application so make sure you apply in advance.
Comply with the Solvent Emissions Regulations (2004)
These regulations specify limits on solvent usage and emissions from activities such as dry cleaning. You must ensure you comply with these regulations to reduce emissions of volatile organic compounds into the environment.
Comply with the Control of Substances Hazardous to Health (COSHH) Regulations
The COSHH regulations state that you must control any substances that are potentially hazardous. You should also assess, control and reduce any risks or potential hazards and protect people from harm. This could include cleaning chemicals and any other substances you use as part of your business.
Comply with the Environmental Protection Act (1990)
The Environmental Protection Act has several different regulations that you must ensure you comply with.
These regulations refer to:
- The disposal of waste chemicals and detergents.
- Energy efficiency.
- Pollution prevention and control.
- The disposal of waste to land, water and air.
This Act is enforced by different agencies, depending on where in the UK you are based:
- England: The Environment Agency (EA).
- Scotland: The Scottish Environment Protection Agency (SEPA).
- Wales: Natural Resources Wales (NRW).
- Northern Ireland: Northern Ireland Environment Agency (NIEA).
Comply with health and safety legislation
There are several pieces of health and safety legislation you will need to comply with. The Health and Safety Executive (HSE) has published guidelines that specify the health and safety standards you should follow, for example, relating to:
- Working with solvents and other chemicals.
- Legionella in dry cleaner water cooling towers.
- Contamination in laundry.
- Electrical safety.
Comply with fire regulations
You must ensure fire safety measures are implemented on-site, particularly because you are working with electrical equipment and chemicals. There are multiple fire regulations you must ensure you comply with.
- Perform a fire risk assessment.
- Comply with the Regulatory Reform (Fire Safety) Order 2005.
- Implement any necessary fire safety measures.
- Implement emergency procedures and ensure these are clearly displayed on your premises.
Comply with the Electricity at Work Regulations (1989)
The Electricity at Work Regulations state that any workplaces that use electricals must construct electrical systems in a way that prevents danger, maintain electrical systems to ensure they are safe, ensure electrical equipment is checked by a competent person annually and conduct Portable Appliance Tests (PAT). This includes any electrical equipment such as washing machines and tumble dryers.
Comply with the Provision and Use of Work Equipment Regulations (PUWER) 1998
These regulations apply to you and any employees you hire. You must ensure any equipment, such as machinery, is fit for purpose and is maintained and inspected regularly. You must also ensure that health and safety risks are minimised to an acceptable level, that you have the correct knowledge and training to use the equipment, and that protective measures are put into place. You must also ensure the equipment is used under appropriate conditions.
Comply with gas safety regulations
If you have a gas boiler you may need to have it inspected by a gas safe engineer. If your equipment is deemed safe to use and complies with government requirements, you will be issued a Gas Safety Certificate. You will need to display your gas certificate clearly for your employees, customers and other visitors to your business to see.
Appoint a competent person
A competent person should be appointed to help your business meet your health and safety legal duties. You can act in this role yourself or appoint another person to fulfil this role. The competent person should have the skills, knowledge and experience to identify any hazards in your business and put controls in place to protect people from harm.
Prepare a health and safety policy
The law states that every business in the UK must have a specific policy for managing health and safety. Your policy should state exactly how you will manage health and safety in your business and state who is responsible for specific tasks and how and when these tasks are completed. Follow the recommended tips from the Health and Safety Executive on how to write a health and safety policy.
Comply with the Health and Safety at Work etc Act (1974)
The Health and Safety at Work etc Act lays out the duties of all employers in the UK regarding ensuring the health, safety and welfare of everyone in your workplace. As you are the business owner, you will be responsible for protecting the health and safety of your employees and any clients or visitors to your business.
Comply with the Manual Handling Operations Regulations (1992)
Manual handling regulations can help to protect you and your employees from sustaining an injury or illness as a result of manual handling tasks. The regulations apply to the lifting or moving of any objects, bending down and reaching high, for example when loading the machines or carrying heavy loads of laundry.
Comply with employment legislation
If you employ any staff, you must ensure you follow employment legislation, including the Employment Rights Act (1996) and the National Minimum Wage Act (1998). You must also comply with legislation relating to recruitment, working hours, sickness, discrimination, dismissals, and maternity or paternity pay.
Comply with the Reporting of Injuries, Diseases and Dangerous Occurrences Regulations (RIDDOR) 2013
RIDDOR states that you must report all injuries, diseases and dangerous events that occur in your business. Reports must be made to the Health and Safety Executive (HSE) using an appropriate recording document. These regulations apply to any incidents that involve you, your staff or your customers.
Appoint a first-aider
All workplaces in the UK must have an appointed first-aider. In the event of an accident or injury, you will then be able to administer the necessary first aid. Although a first aid qualification or certificate is not legally required, it is the easiest way to demonstrate your first aid training.
Apply for a music licence
If you play any music on your premises, you will need to apply for a licence with the Phonographic Performance Limited (PPL) and/or a Performing Right Society (PRS) Licence. You can apply for both a PPL and a PRS online.
Register your business
You must register your business with HMRC before you begin operating. You can register as a sole trader or as a limited company. You will need to register your business name and any other relevant information.
Register for self-assessment tax
This allows you to calculate and pay your own taxes each year. You will need to track your finances every month and submit any expenses as part of your tax assessment.
Positives of Owning a Laundry Business
Starting up a laundry business can be rewarding in many ways. Some of the main benefits of owning this type of business are:
Easy to operate
This type of business is simple to set up and run, particularly compared to other businesses. You don’t need any specific skills or training and can set up your business with only a basic knowledge of how the machinery runs. A laundry business is also easier to operate than many other businesses (particularly if you run a self-service laundry business) as you potentially won’t have to hire staff, you won’t have excessive inventory requirements and you could have a relatively low workload.
A laundry business is not dependent on weather and business doesn’t usually fluctuate throughout the year. People always need to do laundry, meaning your business will always be in demand. This makes your profits more predictable and makes it easier to plan your staffing and stock requirements.
Potentially no staffing requirements
Many laundry businesses operate with no or minimal staff. If you open a self-service laundromat, your business can operate without staff for the majority of the time. This can reduce the cost of running your business and can reduce your managerial responsibilities, for example, you won’t have to worry about creating a rota, managing your staff or handling payroll.
As the business owner, you can choose your own workload and the number of hours you work. You can run your business around your personal life, for example, by only operating during the week. You can temporarily refuse new customers if you want to take time off, and if your workload becomes too much, you can hire additional staff to reduce your working hours.
Potential for expansion
There are several opportunities for expansion, for example, you could begin offering additional laundry services, expand your premises or open another location. Because a laundry business is flexible and requires low time investment compared to other businesses, expanding your business is a feasible option that can help to increase your profits.
Customer retention and recommendations
People often use the same laundromat or dry cleaner for years, particularly if it is conveniently located and provides good service. People often also recommend their favourite laundry business to their family, friends or colleagues which can help you to grow your customer base and your business. This can help to maximise your profits and ensure the success of your business.
Unlimited income potential
As your business and your reputation grow, you are likely to see increased orders and higher profits. You may then begin to charge higher prices. You could also expand by opening other laundry businesses in other locations. A laundry business has potentially high profit margins and unlimited income potential.
Be your own boss
You can make all key decisions yourself and steer your business in whichever direction you choose. You can choose how involved you want to be, the type of laundry business you want to set up, the service you offer and whether you hire employees. You can make the best decisions for you and your business.
You can work alone or as part of a team
You can choose whether you want to operate alone or as part of a team. You can make the decision based on what is best for you and your business. Your laundry business can be run by you alone, or you can hire other staff to help you complete more orders.
Design your dream business
As the business owner, you can create your dream business, from the type of services you want to offer, the materials you want to work with, your business’s brand and aesthetic and your staff requirements. Creating your dream business can be very rewarding.
Be involved with the local community
You will likely operate your business in areas close to your home. This allows you to connect with people from your local area and become more involved in your local community. A laundry business has traditionally been a staple of local communities and you can continue this long-standing tradition with your business. You can also build personal and professional relationships in your community.
Negatives of Owning a Laundry Business
Although a laundry business can be rewarding in many ways, there are some negative aspects to this type of business that you should be aware of:
High investment requirements
Setting up a laundry business requires a large initial investment. Renting your business location and purchasing equipment and machinery can be expensive. Not only does this mean you might need to source outside investment, but it also makes your business high risk. It will also take you longer to begin turning a profit.
High operating costs
A laundry business can be expensive to run, particularly with rising utility costs. Washing machines and tumble dryers are expensive to run and even if you purchase energy-efficient machines, your bills are still likely to be high. You will also need to account for water costs, rent, staffing costs and the cost of your stock (such as cleaning products). You will need to ensure consistently good business to offset your running costs. Unfortunately, high running costs may force you to raise your prices, which can negatively affect business.
Some of your clients may be demanding in their requirements and expectations and may request additional work or expect you to remove impossible stains. They may expect you to complete their order in an unreasonable timeframe, with no understanding that you may have other customers to consider. To avoid complaints or negative reviews, you may feel like you have to cater to these customers, even if their demands are unreasonable. This can be stressful and time-consuming.
Long operating hours
Laundry businesses are often open for long or unsociable hours because they tend to be most popular at the weekend and in the evening. If your laundry services require you to be present, this can mean you are working long hours and this can have a detrimental effect on your personal life. If your hire staff, long operating hours will increase your staffing costs and negatively affect your profits.
It can be physically demanding
If you operate a laundromat, you will likely be carrying heavy loads and bending down or reaching high to put the laundry into the machines. If you operate a dry cleaner, you could be using repetitive movements that cause pain or strain. A laundry business often involves manual handling, which can result in strain and injuries. Additionally, you will also be working with harsh chemicals regularly. Running a laundry business can have a negative effect on your physical health.
Potential damage to garments
No matter how careful you are, mistakes or damage to your customer’s garments is possible, particularly if you work with delicate or expensive materials. Mistakes can be costly, as you may be required to pay for the value of the garment. They can also be detrimental to your business’s reputation.
It can be stressful
As the business owner, you will have a lot of important responsibilities, such as dealing with customers, handling your day-to-day responsibilities and ensuring health and safety. You will also face the additional pressure of being responsible for the success of your business. Running your own business can be stressful.
Your business could fail
Starting up your own business can be risky. Many new businesses fail which could result in you losing money or getting into debt. Your business could fail for several reasons, such as high local competition, an ineffective business plan or if the UK encounters another recession or a period of financial difficulty. Because a laundry business usually requires a high initial investment, the failure of your business could have a detrimental effect on your finances.
As you are self-employed, you won’t receive benefits such as pension contributions. You will also be responsible for doing your own taxes and organising your National Insurance contributions. You will also have a lack of job security.
Although the majority of customers leave honest reviews, some customers are difficult to please and will leave a negative review because of the smallest complaint (even if it is something outside of your control). Sometimes a fake customer also leaves a fake review, which can be extremely difficult to disprove and remove. Negative reviews can be extremely damaging to your business, particularly if your business is new or you’ve had relatively few orders.
Stringent health and safety requirements
Because you are working with electrical equipment and chemicals, there are strict legal guidelines and health and safety laws you must ensure you comply with. Failure to comply (even if it is not intentional) could result in an injury or a serious incident (such as a fire) and could result in you being fined or prosecuted. Complying with all requirements can be time-consuming and expensive and can result in additional stress.
If there’s a problem, you need to fix it
If there is an issue, no matter what time of the day it is, you will be responsible for fixing it. If there is a water leak, the electricity stops working or your equipment stops working, you will be responsible for fixing it – even if you run a self-service laundry business. It can be difficult to manage stressful situations and solve major issues yourself and you may feel like you are always on call and can never completely disconnect from work.
Planning Your Laundry Business
An effective and well-designed business plan is essential to the success of your laundry business. A business plan can help you to focus on the specific steps that will help your business succeed, plan your short-term and long-term goals, determine your financial needs and help your business to grow.
When creating your business plan, ensure it contains information such as:
- Your company information.
- Your company description.
- The services you will provide.
- Your branding, marketing and advertising plan.
- The structure of your business.
- The operational plan for your business.
- The financial plan for your business.
Some of the factors you will need to consider when creating your business plan are:
What type of laundry business will you set up?
You may choose to set up a laundry business that specialises in a specific service (such as dry cleaning) or that offers a variety of laundry services. Consider your skills and experience, the cost of the equipment and materials, the services offered by your local competition and the most in-demand laundry services when considering what you will offer. If you plan to set up a laundrette business, consider whether your business will be staffed or self-service.
What is your business summary?
Your business plan should include a detailed overview of your business, including your location, the size of your business (e.g. how many machines you will have) and your business goals. You should also consider who your target customers are.
Will you specialise in a particular type of garment?
Some laundry businesses choose to specialise in a specific type of garment. You may also offer other laundry services alongside your speciality service, but may use this as your main advertising strategy or to attract your target customer base. For example, you may specialise in dry cleaning suits and dresses.
What local competition do you have?
Analysing your local competition allows you to look at what they do well and what you think can be improved upon. Being aware of your competition is an important step to ensuring the success of your laundry business. You should also look at the types of services and products they offer, their pricing and their typical customer base.
Will you hire any staff?
You may choose to run your laundry business alone or have a self-service laundrette. Alternatively, you may choose to operate a fully-staffed laundry business. You may opt to hire staff to handle the laundry services or for other tasks such as cleaning. Calculate the costs of hiring employees and consider how this will affect your profits.
What are your equipment requirements?
Consult the list above to determine your equipment requirements. The equipment you require will depend on the type of laundry business you set up and how big your premises is. Once you have determined your equipment requirements, you can then calculate the initial costs of purchasing the equipment and the monthly replenishment costs (e.g. for cleaning products).
What is your brand?
Creating your brand is a key way to ensure you stand out from your local competition. Branding can help you to focus on your target customers, attract clients and concentrate your marketing and advertising strategies. Some ways you can create your brand are by focusing on your business’s visual identity and creating a brand story. Your business name and logo are also part of your branding so ensure you consider these when creating your business plan.
What will your advertising and marketing strategy be?
There are many ways you can choose to advertise your business. This can include partnering with other businesses in your area, advertising in your local community, advertising on social media and using paid online ads. Your marketing and advertising plan should detail what your brand is and how you plan to promote your business. As part of your marketing strategy, consider the most effective way to reach your target audience and attract potential customers. Create an advertising plan that is specific to the type of business you are going to run and how you plan to operate.
What will your start-up costs be and how will you finance your business?
Consult the list above to help you calculate the approximate costs of setting up and running your business. Determine what equipment you need and the amount of equipment, as well as the cost of your premises, to help you determine your start-up costs and what your initial investment requirements will be. You can then calculate whether you can finance your business yourself or whether you need to source outside investment, for example, from a bank or an independent investor. Determining your start-up costs and running costs can also help you to create a budget and predict when you will begin to turn a profit.
What is your pricing policy?
Consider the type of laundry service you will offer when creating your pricing policy. For example, you may charge by weight or load if you are running a laundrette business and by individual item if you are offering a dry cleaning service. You should also consider the pricing strategies of your local competition. You may opt to offer discounts to returning customers or for a certain number of garments.
What are your sales forecasts?
You will need to determine how many laundry services you can feasibly handle each day and what your weekly, monthly and annual sales forecasts will be. As your business grows, your sales forecast may change.
What are your business objectives?
Your business objectives are crucial for creating a successful business plan. Your business objectives highlight the targets and goals of your laundry business and help you to create a one-year, three-year and five-year business plan to help you grow your business.
Your business objectives should be SMART:
- S = Specific
- M = Measurable
- A = Achievable
- R = Realistic
- T = Time-bound
Have you complied with all legal requirements?
Consult the list of legal requirements above to check you have complied with all requirements and regulations and that all your paperwork is accurate. Failure to comply with legal requirements could have a detrimental effect on your business or could result in a fine, the forced closure of your business or, in serious cases, prosecution.