By: Lisa Eclesworth
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Are you an investor looking for an investment opportunity that will grow your wealth and generate consistent cashflows over time? If yes, a laundromat business might be the right choice for you. Below are ten compelling reasons you need to start a laundromat business.
1. High return on investment
Laundromat ventures post better returns on investment when compared to other popular investments like real estate and mutual funds. For example, with real estate, you can expect an ROI of between six to 12 percent, whereas laundromats deliver a much higher ROI of up to 30 percent under good management. Laundromats are an excellent cash cow and a worthy investment, especially in major cities.
2. Laundromat can offer you tax incentives
According to laundromat resource, laundromat ventures can offer business owners savings on tax through multiple channels. Laundromat equipment such as washing machines and dryers are subject to depreciation over their useful life. As a laundromat owner, you can gain a tax advantage by reducing your tax by the amount you depreciate these assets. The second element of tax-saving arises due to the nature of laundromat business operations. Unlike an employee who pays employment tax on their salary, laundromat operators have the flexibility of settling their expenses before paying taxes.
3. Laundromat operate on a cash basis
Laundromats are one of the few businesses that operate on a cash-on-delivery business model. Laundromat proprietors rarely chase clients for payments or deal with bounced checks for services offered. Clients must pay upfront before beginning any washing, drying, or deep cleaning assignment.
4. self-service work arrangement
Laundromats operate as a self-service business where clients pay before cleaning their laundry. As a business owner, your job is to provide the necessary equipment and tools to enable clients to perform their cleaning tasks. However, you can choose to offer additional services like cloth folding at an extra fee.
5. Earn through multiple income streams
Though the primary income of a laundromat business comes from the self-service washing and drying assignments, there are other ways in which proprietors can earn money. There’s always an opportunity to wash, dry, and fold clothes for clients who are too busy to clean their items. Secondly, you can install beverage, ATM, and snack vending machines for your clients and earn extra bucks.
6. A variety of financing options
Starting a laundromat business requires a significant capital outlay. The good news is that you don’t have to raise all the funds by yourself. There are many ways you can raise funds, from bank financing to private financing. You can even approach washing machine distributors for assistance in setting up your laundromat venture. Some vendors can provide up to 100% financing if you have prior experience in the industry.
7. High barriers of entry
Starting and operating a laundromat business requires a significant amount of money. Washing machines, dryers, and folding equipment do not come cheap. High upfront costs are a barrier to entry, meaning those who choose to engage in this business face less competition than other industries.
8. Laundromats generate passive income
The self-service business model in laundromats means that proprietors have very little involvement in the day-to-day running of the business. A typical day at work will involve opening, cleaning up, and closing the premises, tasks you can delegate to a staff member. Maintenance and repair happen occasionally or when machines break down. Such a business model can free up your time, allowing you to spend more time with family or running other errands.
9. Consistent business all year round
Most industries deal with seasonal cycles comprising peak and low-demand seasons. Laundromats are rarely affected by seasonal changes because clients require laundry services throughout the year.
10. Little to no experience is required
Many proprietors who start laundry businesses do so with minimal prior experience. You only need a general idea of running and managing a business.
The laundry industry is an attractive sector due to the ever-growing number of clients who need laundry services. Laundromats have great income potential and can provide you with an excellent way to earn passive income as a secondary business. Visit the site below for more reasons to invest in a laundromat business.