Owned a Laundromat for a Year (Does it Make Any Money?) Pt. 2
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- čas přidán 23. 07. 2024
- If you opened a laundry business last December would it have made money this year? If you think “No way!”, then I’m happy to prove you wrong. Meet Justin Pike of Ferndale Laundry-whose laundromat business has grown during the pandemic.
Over the past year, business partners Justin Pike and Mike Cox turned their focus away from making money as fast as possible to serving their community. And it has helped their business thrive!
For part two of our interview, Alex is exploring the coin laundry business even further. Justin will answer questions about the costs and ongoing expenses of starting a laundromat and explain which organizations are willing to work with a laundromat as a startup business.
We’ll also talk to Justin about his business structure and how his community focus helped Ferndale get through the pandemic. He’ll also explain what they plan to do when the market shifts back to normal.
Justin is going to tell us about his vision for the future of Ferndale and how he intends to implement a home delivery service and open a second location. He’ll give us insights on the various services offered by a laundromat like pick-up and delivery.
Running a laundromat during a year when there’s a pandemic and a factory closed in the area may seem like a tough business. Justin will explain how they delt with those issues and overcame them.
If you love a story about a small business succeeding against adversity, tune in!
And don’t forget to watch Part 1 if you missed it ►
• Owned a Laundromat for...
Watch another one of our interviews with laundromat owner:
How Much Cash Can a Laundromat Business Really Make? ►
• How Much Cash Can a La...
Resources:
www.upflip.com/academy - Start, Build, or Grow Your Business
ferndalelaundry.com - Find Out More About Justin's Laundromat Business
Timestamps:
0:00 Intro
0:37 Tips and tricks
1:56 Monthly marketing expenses
3:27 Vending machines
5:24 Starting on home delivery service
7:02 Blitz questions for Justine
8:42 Cash change machine
10:46 Water drainage system
12:11 Most profitable service
15:31 Outro
#laundromat #laundromatbusiness #laundrybusiness - Jak na to + styl
If you haven't seen Part 1, watch it here: czcams.com/video/HVCJ-_VpGrY/video.html
What did you think about Ferndale’s community focused model? Should more businesses operate this way? Tell us what you think!
You have a first class laundromat; the best I've ever seen.👍
Your video looks good. Also small suggestion you can post the expenses on the side of video
why do most laundromats have a bills to coins machine, but the machine does not also do coins to bills? i can develop a machine to handle this for you. in fact. it may be beneficial to remove the system of putting coins into machines altogether. it now scans a paper code, at the machine, and credits you for the time. or you can go paperless, and control the washing machine with an app. with this system, it removes coins altogether, and eliminates the need for going to banks etc. or use a dual machine that despenses coins for bills, but also dispenses bills for coins. that way your not worrying about "loss of coins" etc.
Interesting stuff! I randomly saw part one in my feed.
I'd love to see a follow up on this. Wondering how business is now and how much he's involved in the business today.
I'm still watching, but I'm curious if he has gaming machines. I've always heard they did pretty well, but I don't know if that holds true today and could see the space might be used otherwise.
You can buy vending machines all day in marketplace
he seem genuine about the helping people part, he's a good partner.
Yes, me too totally agree with your view. The owner is generously sharing all the truth about this business. Let us bless him well.
Jay, Singapore
As a fellow business owner, I like this channel :). He's a good case study, although, secretive about the things your audience really wants to know which is simply, "How much damn money are you making AFTER costs and expenses?" It's like pulling teeth with these people lol.
thank you! Yeah some owners dont want to share that info.
For a business like this, it's actually wise not to disclose that.
At any one time, laundromats has a lot of money - cash money - relatively speaking to retail brick and mortar and tend to be overlooked as potential targets (probably because most subconciously equate laundromat with coins?).
If customers learn that a laundromat (which does not have security, generally no staff in store) has become a target, then they'll stay away.
Then there's advertising to potential competition if they know exactly how much an outlet is making.
Anyway, this was a great coverage, kudos to UpFlip.
_P/s: I'm an existing laundromat owner of 5 years._
When all's said and done, extrapolated over a 10 year cycle (allowing his machines to depreciate and break down), he's making about the equivalent of $70k/year, no more.
@@drott150 I would’ve said 71k but I guess 70k is near enough, well done.
@@mrbachittarsingh9243 Yeah, but if he does roll the profits into other laundromats it can grow from there. But his time allotment will grow as well. He will work for the money he earns, but if taking orders from a boss ain't your thing, then working as a laundromat manager can be your escape.
Best looking laundromat I've ever seen
It definitely is nice!
Beautiful laundromat
The breakeven on that capex is going to be a LONG time from now.
never seen a laundromat so nice and clean
Having watched quite a few hours of how to own a laundry mat. It makes the most sense to retool an old location with new equipment. Wash and fold is the sweet spot to making money because the self serve highest demand is Friday-Sunday. The rest of the time the machines aren't in use.
Did you end up starting a location PJT?
All businesses including working for an employer has risk. Do not be afraid of risk if you have the bravery to face it. Because the regret of not executing an idea and feeling what could have been will hurt more than just the fear of losing. One life to live, live it to the fullest and take risks. I do all my life. Regrets hurt more..... Also, I had a laundromat 23 years and lost boat load of money due to bad advise from, what I thought, was a friend at the time but I still plowed through life taking risk and being persistent. Now I am a multi millionaire.
It is amazing how people who never owned a business don't understand what goes into making it successful. This gentleman is focused on the success of his business. Entrepreneurs have a different mind set.
I've always noticed that if a military veteran owns a business the inside part of the establishment is immaculately clean because of the cleaning habits we built during basic training lol. It looks brand new at that laundromat facility because in the bunk bed area we were told to make the unshinable shine, polish each and every piece of chrome, and not a speck of hair will float by during inspections by the drill sergeant :D.
Very interesting insight.
The best location for laundromat is near colleges or universities dorm cites or lots of apartments in the neighborhood.
I just discovered your channel tonight and I’m obsessed already. I’m always looking for new business ideas and to get an inside look at the logistics is priceless.
Wow, an inside look into how businesses work day to day! Incredibly valuable!
Glad you enjoyed the video!
There's a few issues I'm having after having watched both videos. I still don't know how much they make or what their profit really is. I understand how much it cost for he and his partner to open a brand new laundry business with all brand new machines = 3/4 of a million dollars....uh yikes! Title should read "Brand New laundromat and the cost owning and running it".
Exactly I kept waiting to hear him say what his profit is but he never did.
Agreed! I think his profits are slim.
I like watching investment joy channel better because he tell you exactly what he makes per month
Yup. Don't mention anything about how much you can make with a laundromat in your video title just to get people to watch your video if that's the ONE thing you aren't going to share. He didn't even have to say specifics, just ballpark figures what kind of profit a laundromat similar to his can make after expenses. Very misleading...
yeah, and didn't see any customers
Thanks to both of you. This has been very informative for me and my wife.
Fantastic videos I am so glad that I saw them I have always had a fascination with the laundry business and almost got into it back in Ohio.. I would love to see you do one on car washes both coinoperated and fully automatic.
Thank you keep it going
This is by far the best business related channel I have expereinced on CZcams! Great Job!
Thanks for watching and supporting our channel! ☺️
Here is a tip for that business owner. He should hook up with his Dad and open a bar right next to the laundromat with a direct entrance connection between the two. People will magically love doing their laundry and instead of waiting, pop over for a pint, some food and social interaction. You will be surprised at the increase in your business, very profitable.
This is very true...
We literally have a small laundromat that is also a cafe/restaurant itself. It does attract the customer to order some drink or food while waiting.
Austin, TX has/had..."Suds and Duds". Don't know if it is still a business.
Long ago - 1970s - I went to school at Syracuse U. On Burnett Ave. (I believe) there was a laundromat next door to a bar. Can't tell you how many times we did laundry, hooked up with girls or started winning at the pool table and our laundry was dried to a crisp. We invented what we called "the wrinkled look." Good times and I bet both the laundromat and bar made plenty of dough.
why not just make it a Laundromat & Bar........
"Hey, what you doing tonight?"
"I'm heading to 'The Mat', got some nasty skid marks on my undies and I think it will be about 14 wash cycles and 13 pints to get the job done"
What a great channel. Thank you for this valuable information!
Thank you for the two-part videos. It didn't catch my eye on your channel, but I would be interested in seeing you interview an owner of self-storage facilities and boat/RV storage facilities. This has always been interesting to me and would love to see some content. Thanks!
Glad we can help! And we'll add those to our list! Thanks.
I would have loved for you to ask him "what happens if a machine breaks down, or the projections of wear and tear? How often do you potentially have to replace a machine? How much does this cost?"
Thanks for watching Google User. Typically, a machine last 14 years or 5000 cycles depending on use. The cost would depend on rather the machine can be fixed or has to be replace. Would you ever consider opening a Laundromat?
You have asked about cost, which is fixed at retooling, operating costs, which are fixed, and parallels # of laods, tax considerations, again a fixed program, and maintenance, which is a sliding scale. Did your last new car cost the same to maintain the 9th year as the 1st? Did ANY new car in your city? Why should any business heavy equipment? Bu conversely, the 2nd monthly payment was the same as the 55th.
Your algorithm will be most efficient at 7 years, pursuant to the tax cycle. If the retool cannot be funded over a 70-80 month note, don't do it. The heavy weights in that finding are tax schedule, and maintenance schedule. Utility volume should remain appx. the same, so many gallons, so many feet of gas, so much electric, but the maintenance will CLIMB, as the tax write off ceases. When the tax schedule closes, you will need to start that schedule again, and that means new machines, which means no to low maintenance for the year, once again.
The doorstep delivery reminds me when I was a kid.... Everyone had a metal milk box on their front porch, and Fichett milk man would drop off glass qts of milk in the box and when you were done with the milk, you rinse the bottle and put it in the box.
Reminiscing childhood memories... 😀
Its all about ROI. Operating profit is great - but what about the the original principal....very hard to build wealth this way.
Private businesses sell for 7-9 times owners earnings.
@@manfredadams3252 Private businesses sell for 2-3 times the total sales of the company in a given year.
Then you would be referring to ROE and ROA. Nevertheless balance sheet is as important as ROI (Profit and loss). They key to that business is high debt to equity ratios.
Great video. The place looks pretty clean. Owner seems honest. God bless him & the business
Thanks a lot Zizou! He’s definitely a great guy 👌
Wonderful video with really great information. On a technical point, the constant floating camera tends to cause headaches and motion sickness in many people. I found that I had to scroll the screen out of visual range so I didn't barf and still ended up with a raging headache. Fortunately, the audio was great and thanks to info cues in the dialogue I was able to scroll back up to see the examples described. It's usually a good idea to keep the floating camera trick to only about 10% or so of screen time (see: Blair Witch Project). BUT! Again, great information. Thank you.
Watched both of these videos based on this laundry mat business what a beautiful, clean and well maintained laundrymat. The equipment he has is not cheap so you know they are making money and he said the profits they make goes back into the laundry mat. I'm always amazed how businesses get started and inspiring to hear. What nice, humble, caring and genuine guy all the best prayers for him and loved ones, keep up the good work I am sure his clients are well pleased and taken care of.
Thank you for watching our content! The laundromat is definitely out of the ordinary!
Where I live, there are a lot of people with bedbugs. I had considered buying an existing laundromat, but the thought of infestation really played on my thoughts. I mean, I’m sure that the machines would get hot enough to kill the bugs, but what about the ones that fall out on the way in?
This confirmed for me that in some types of businesses, I like being an investor more than I like being an owner.
Awesome thank you for posting this. Very informative!
What a nice story. Wish you guys lots of luck with your laundromat business. It was very informative. Thank you
We're glad you enjoyed the video!
When those machines aren't new they will be randomly breaking. People who let their clothes pile up in the basement covered in feces of their cats/dogs/selves probably will use 10 machines and leave poop in them and on the floor (seen it.) Crazy ladies will run a bunch of machines to see which one is hottest and demand refunds on the rest (seen it) crazy people will wash plastic bags and trash (seen it too). You better know how to fix equipment and keep a place clean. They aren't easy money. Say goodbye to ever going anywhere unless you have a trustworthy person to be there to put out fires (literally and figuratively) seen it. They aren't easy. Need to own the building and know how to fix everything yourself!
Laundromat experiences and business ownership will certainly vary widely by location, business set up and demographic. Thanks for sharing your own experiences Paul.
His laundromat is in a good neighborhood. The TV is not behind bars.
7:55 was a truly awesome answer that I was not expecting! I hope his dad saw it!
Would like to know how maintenance is handled. Provided on contract from the machine vendor? How much do they charge? What are the options there?
that was an incredible deep dive 👍🏾. Extremely helpful for potential new laundry mat owner.
Great series. Well done.
Great videos on Laundromat segment - How about demographic decisions criteria, drilling down, due diligence for market, competitor analysis segment.
Thanks again.
I’ve always wanted to own a laundromat. Great stuff. Thanks.
Hope the video helped you make the right choice.
My favorite channel, I can watch this all day.
You Rock Las Vegas!😀👍
Very thorough good interview another business would be self storage would definitely watch
this is giving me goosebumps im so exited thank you!!!!
So much behind the scenes you just don't know about and !@#@# the cost ! Just never knew.. Great interview !
Thanks for the video. I am here in the Philippines and starting the initial work on a laundromat/coffee shop.
Hey I know Justin. I served in Iraq with him. I knew him as CPL Pike. Fellow Blue Dragoon.
Thank you for your service Jacob!
The one question I was waiting for you to ask was: What is your yearly profit? I heard Justin say 50% was their profit. But what does that equate to ($50k, $100K, $150K)? I'm sure everyone watching would have liked to hear numbers vs percentages.
15% not 50%.
@@madhavyu he said fifty.
Exactly! I watched both videos and never got my answer.
Based on info provided its over 59,000. How much more over I can't say.
That means that how much it costs in utilities and how much it costs to pay employees he only makes 50% of what it costs each month to run the business. That does not cover the $1,000,000 it cost him to open the laundromat. To put it bluntly he is $1,000,000 well $500,000 for him and $500,000 for his partner and then they are loosing half of what it costs to pay the utilities and employees each month. To put this bluntly it is not a money maker.
@Upflip, just curious, Do you have an expense for interviewing these business owners? Basically, whats in it for them? Compensation or simply just a way to promote their business?
I ask because I thought most people don't like to openly provide their revenue numbers. Good video.
I was thinking the same thing. I don’t think he even mentioned the name of their business one time. So they didn’t really get much out of telling people their entire business which in turn just creates more competition..
@@mikewilliams2106 Haha, yea I'm a bit sad the creator didn't respond. He used to read and respond to every comment.
New subbie, great info!!!
Thanks for subbing!
I want this guy to sit down with that Investment Joy guy on youtube that owns a small laundry mat in Ohio. It's like night and day the differences between these laundry mats.
Yeah agree, also sounds like investment joy makes more from his vending
Investment Joy owns them though. This owner overexaggerate the price of vending machines. He could literally buy used machine and make more money than he is doing right now. But it is very understandable that he does not want to take care of them.
@@william-christophermiehe4845 this guy has over paid for everything
@@Smartriide Yeah, its a completely different business model than InvestmentJoy. Different way of doing it by going to a very high-tech way, however, if it works, it has potential to bring in good return. Very risky, but could definitely work. Good on him for trying, but wouldnt have gone that way personally
Its my first time watching your video, and it's really interesting. It's cool business model, thank you.
Thanks for watching!
Another well done video! 🙂 Are you guys on Facebook? I saw the Instagram shout-out, but I'm not a picture book type of guy, lol. Gonna checkout your blog next. Let me know how else I can support you guys, love your channel(no homo). 😘
Really appreciate the kind words! Just keep sharing our videos :)
How do you cover your service costs, I didn’t see any of that covered?
Justin is a pro. Great attitude, he is clear, very informative, and articulate.
He could make a side gig of being Will Ferrell's body double. The resemblance is very close.
Thank you kindly for the part 2!
So true! Did you learn a lot from this video? What are your takeaways? ☺️
Will Ferrell is a very large man tho. He is no lookalike.
@@UpFlip I didn't get a notice about your question - good old youtube. I have an MBA and looked at the video from a case study perspective - it was very informative. You did a great job.
Like most people in college, we used laundromats because apts we rented had no W&D and I always thought "this seems like it could be a good business"
The tricky part might be the reliability of the location. When the wife and I were living in Berkeley (I attended UC Berkeley), she attended UC San Francisco across the Bay Bridge. SF is a perfect laundromat zone - lots of old rentals with no W&D.
I mean it WAS. In the early 1990s SF had won the "cleanest big city in the U.S." award four years in a row. I know that's hard to believe now, but it's true.
We left the SF Bay Area and California in 2017 - the decline there was astonishing. We moved to a state where we could predict the trajectory of 'defund the police' and so on not happening.
So you have to choose the right mid-to-large population region. Because there are tons of rentals out there with no W&D. Huge need.
.
td for misleading title. since you never actually got into profit margins you should have titled the video differently
They discussed profit margins in part 1😀
Agreed
@@teamturner3933 He vaguely said something about 20 to 30 % then said 50 it was confusing. is that gross or net? Then when he continued he speaks of the folding service isn't making a profit. Then he says the change machine misleads the tax collector by saying he got 50k from change but only 20k was put into the machines? Next he switched it to 5k and 3k? He says he purchased two hot water heaters instead of one so they don't have to be inspected? Everything in a business is inspected? I appreciated the location advice on retooling. The rest was just Lint trap laundry fluff.
Taking businesses from the Asian community
Why don't you have a machine issue custom tokens that can only be used in your machine? I feel like that would help with the coin shortage
In bay automatic and self serve carwash. Would love to see you interview someone. Great channel
Thank you! We have that on our list.
They have new machines do they depreciate them for taxes? What brand are they? Do you set aside funds for future repairs?
Looks like they are speed queen washers and dryers
Wonderful interview and well presented. How can I get in touch with him is I want to set up the same thing but in another country?
Good interview. Thank you.
Thanks for the lesson about the coin machine (No coin shortages)
Would love to see an episode on a multi-site bakery/cafe
We got a video on a Bakery!
I like the idea of part one and two
Thank you!
Smart business owner. He`ll be a success for sure.
pickup and free delivery will the clothes be nicely folded and ironed .If theres inclusive of ironing how is the process done which type of machines
Hi Hellen, cloths getting nicely washed and folded is a great feature and could free up a lot of time. Industrial dryers are sometimes used to knock wrinkles out. Would you ever utilize this service?
Amended question, service cost to repair your equipment when it breaks down
Pretty cool...I lived in Bellingham and to see this type of success is awesome💯
It really is!
What brand are the washer/ dryer/ app?
How much of the $400k went to washer / dryers / equipment vs building?
I have to make one important comment. By far, bare none, you have the nicest laudry I've ever seen!
How do we find old laundry mat locations on sale?
How do we value the buy?
GREAT!!! video. You asked the questions as I would have and Justin was very gracious to give answers in detail. I always wanted to own a laundry. How does one search for those for sale? Also can you do a video on those who buy foreclosed homes/businesses as a business.
Maybe I missed it but I wonder how he will handle machine repairs when that comes up.
What brand were those machines?
Excellent overview of an interesting business. The tech they're putting into it these days is pretty cool. It would have been nice if you had touched on machine maintenance and repair costs. Even new machines need to be serviced. How long does the average machine last before needing to be replaced? Also, he mentioned that he had a rather high gas bill for heating water, but the electrical seemed quite low. How is that possible with so many dryers? Then there's also location rent and license tax fees etc. A simple, but complicated business.
Thank you for these wonderful questions! We'll keep these in mind.
Taking the whole total of income and then subtract what ever bills you need to pay will leave you whit a profit and that what people really want to knw..we need to know how much can we take home..did my homework so far and it seems most of the money goes to rent water and electricity..on this particularly lowndrymat it seem he spent a fortune..how long it will take him to recover..those are the important things to cover...beatifull laundromat by the way..it looks really really nice
What company will be used to pick up the clothes and deliver?
Great info. New subscriber.
Great video!!! Thank you.
He's incorrect on the costs of those machines. He doubled the price.
I think a macerator pump would be a great investment for your drain system. Have you been able to prevent vandalism in your establishment? Every laundromat that I've been to has some type of vandalism or cleanliness issues.
Vandalism is a sign of a cancerous society, do you live in the third world?
How much was the build out for the space? How much would the build increase if space was not previously used for coin laundry?
The costs can easily exceed half a million. Change of use for commercial space can get expensive quick.
The clock says 3:30. The sign says "last load @ 8:30". It's dark outside and no customers. Is this at 3:30 am or, Alaska in winter?
How often do they need to handle repairs/maintenance and how much does it cost per month? Do they handle it themselves, hire a person each time something needs to be repaired, or have an employee who handles repairs/maintenance?
If you find a family and sub lease the spot behind the counter for 1 dollar per month and give them all the profits from all other services including a drop off laundry service. You will have peeps there during all working hours and have a clean place.
Great videos! How about one about a laser engraving business?
We'll put that on the list!
This man gives all the sauce 🙌
How can we reach out to Justin for further information? I’m leaving the service and looking to start a laundry service as well. Thank you loved part 1 and 2.
The pick up delivery service is…interesting. Typically laundry mat is associated with apartment living or low income so it’s interesting to see what kind of use their concierge service will get.
I think it depends on where you live. In Europe laundromats services normally are associated with dry cleaners and do a lot of concierge work for high income business people that do not have the time to wash their own clothes. Catering to low income people who don't have their own washer at home is more of a side business, especially if you go into city centers. When I lived in London most laundromats had full service offers where you dropped you laundry off and then picked it up clean. The apartments there are so small that it is more economical to not have your own washer and instead pay someone to do your laundry, so it was not just for low-income people.
I can see a laundry service work well as it can be a huge time saver for busy singles or couples. Once you add small children the amount of laundry might make it less attractive.
Your mind is too small . I see the big picture of this
That way he is expanding his customer base!
really cool concept
that's the cleanest laundromat i've seen in my entire life.
Can you guys interview a junk removal business please, like 1800 got junk or lugaway junk removal. I am looking to get into the business and I would love to see you do a interview in the area, thank you.
We'll see what we can do! :)
Thx for the info.
So, how much does this kind of laundromat make?
Could they use a token system instead of quarters?
Thats a good idea!
My idea is instead of putting quarters in at a time they should have a cup holder like dump quarters in counts it starts laundry
Did anyone ever hear in either video if they purchased the machines or is it a lease situation?
Lonely days. Spending time at the laundromat
I wish CZcams had a way to search comments for specific question or information that is already addressed. Did he say how much in dollar amount is he making net profit a year? I saw the section where the owner said he has %50 margin. He is selling service so is %50 margin on cost of all expenses (utilities + labor)? Can someone break it down for me?
Great episode
Glad you enjoyed the episode, Pedro!
Theres no laundry mats that nice in my area. It would make the chore a better experience. Owner is great and easy to support.
This is some great info. I plan to buy a laundromat soon, would it be better to have Gas or Electric dryers?
That's exciting! And a great question. I would direct it to Justin and see what he recommends.
Cost efficiency will depend on your service area/plan. Reach out to your local utility company for a cost plan estimate based on the machines you're planning to bring in (the manufacturer usually provides a "per cycle" number you can extrapolate out from to estimate cost scaling based on number of machines running X cycles day/week/month/year)
Either way, best of luck on the business!
Any views on self storage outlets?
50-60% return is great. I have had an idea for years to create a solar laundramat. Utilize solar water heating and lots of panels for electricity. Give it a very catchy name with some great signage and that should better the bottom line as well as be a solutiion to do our poart for the envirnment. After all we can't let Tesla and EVs do all the work LOL
Natural gas is the only sensible way for hot water
Battery costs would be prohibitive and inverters are not efficient. Perhaps use them to reduce your electric bill to run things like the lights. An even better idea is to use solar to heat the water to reduce the amount of electricity or gas needed to do the same thing.
Did I miss the part of servicing the machines? Are they contracted out or do the owners repair them?
Great question! Servicing is usually done by mechanics, but regular maintenance is something they do every day. Hope this helps! ☺️