The coin-operated laundromat industry has declined in recent years as more apartment buildings provide in-unit laundry machines. However, for entrepreneurs interested in launching a laundry business, the coinless or cardless model is gaining popularity by enhancing convenience. This comprehensive guide covers how to start a profitable unattended laundromat business in today’s market.
Table of Contents
Overview of the Coinless Laundry Model
In the traditional self-service laundromat model, customers insert coins or tokens to activate washers and dryers. However, this process can be inconvenient as customers may not have enough change available.
The coinless or cardless laundry concept eliminates this pain point by allowing customers to pay with credit/debit cards or reloadable laundry cards. With virtual wallets connected to payment methods, customers enjoy a simplified experience.
Most coinless laundries feature an on-site attendant at least during peak hours for customer service, maintenance and supervision. But the machines operate unattended outside these staffed windows.
For entrepreneurs, the coinless model provides advantages such as:
- Enhanced customer convenience and satisfaction
- Reduced collection and accounting of coins/tokens
- Ability to leverage loyalty programs and mobile payments
- Lower machine downtime from coin jams and failures
- Higher per-load revenue from card fees and built-in buffers
The automated nature of coinless laundries allows for attractive margins for owners.
Key Demographics to Target
Certain customer segments are especially suited to unattended laundromat options:
- Apartment renters without in-unit laundry
- Families needing bulk laundry capabilities
- University students living off campus
- Customers requiring large machines like for comforters
- People without laundry access during travels
- Households between home sales with no appliances
- Individuals needing quicker dryer times for items like sleeping bags
- Clients of cleaning/linen rental businesses needing laundry services
Both residential and business customers appreciate the flexibility and benefits of coinless laundries.
Equipment Selection Considerations
Optimizing your laundry equipment mix is crucial for maximizing customer satisfaction and revenue. Assess factors like:
Top loaders allow easier loading but hard on clothes over time. Front loaders use less water and detergent but cost more. Offer both.
Provide a range of sizes – 30lb, 50lb, 80lb – to accommodate both households and businesses.
Timers, temperature controls, and cycles tailored to fabric type improve customer experiences. Upgrade models have sensors.
Provide stacked, single and commercial dryers. Large capacity efficient commercial dryers encourage customers washing large loads to get everything dry quickly.
Card readers must be reliable and allow contactless payments like Apple Pay. Ensure stable internet and cellular connections.
High-resolution recording deters theft and monitors for maintenance needs. Signage should alert to cameras.
A coin changer still proves useful for customers who forget laundry cards and provides convenience for coin-only customers during the transition.
Solicit proposals from leading vendors like Speed Queen, Dexter, Maytag, and Alliance Laundry Systems when selecting optimal durable equipment.
Designing Your Laundromat
Consumers expect more upscale laundromats today. Some design elements to include:
Thoughtful Layout – Organize machines logically with enough space for carts to pass. Have seating facing TVs.
Attractive Finishes – Use quality floors, decorative tile, lighting and wall colors to convey upscale ambiance.
Ergonomics – Locate dispensers and counters at convenient heights. Make machines easy to operate.
Cleanliness – Maintain meticulous cleaning protocols. Install hand sanitizer dispensers.
Entertainment – Mount flat screen TVs visible throughout. Provide WiFi and charging ports for customers.
Safety – Ensure waterproof electrical, emergency lighting, fire suppression, first aid kits and safety cameras.
Capacity – Size appropriately for your market. Leave open space for possible future expansion.
Signage – Use branded signage for wayfinding and promoting services/programs.
Efficiency – Arrange machines to minimize utility runs. Select water-saving equipment.
Thoughtful design attracts customers and enhances satisfaction. Visit successful laundromats for inspiration.
Site Selection Criteria
Ideal locations for coinless laundries feature:
- Dense surrounding residential population within 1-3 miles
- High foot and vehicle traffic for visibility
- Abundant parking for customers transporting laundry
- Proximity to colleges and universities
- Limited nearby competition offering unattended laundries
- Retail centers with complementary businesses like dry cleaners
- Neighborhoods with older housing stock likely without laundry in-unit
- Vacant retail spaces permitting laundromat use, with planned residential growth
- Meets zoning requirements and achieves proper permits
- Allows 24 hour customer access for flexible laundry timing
Select sites with sufficient customer demographics and traffic to support your business.
Building Your Business Plan
Every new laundromat needs a detailed business plan covering:
- Proposed location, competition analysis, target customers
- All equipment to be purchased and total equipment budget
- Floor plan sketches and counts of washers/dryers planned
- Staffing needs like number of attendants and their responsibilities
- Key operational processes from cleaning to maintenance
- Marketing tactics to build awareness – promotions, advertising, partnerships
- Capital stack detailing sources of funding and financing
- 3-5 year financial projections including expenses, revenues, profit
- Owner bios showcasing experience and skills
- Assumptions on customer volumes, revenue per machine, repeat business
Thorough planning makes launching considerably smoother and provides an executable roadmap.
Financing Your New Laundromat
Like most small businesses, laundromats require financing:
Savings & Personal Funds
Many entrepreneurs bootstrap starting laundromats using personal savings to fund a substantial portion of costs.
Small business loans and SBA loans allow borrowing capital with reasonable terms. Lenders focus on your credentials and projections.
Specialized lenders offer loans for purchasing laundry equipment often with lower rates and payments.
Business Credit Cards
Cards with 0% promotional periods allow deferring some purchases over time interest-free.
Websites like Kickstarter let entrepreneurs raise smaller pieces of capital from backers.
Partners & Investors
Consider bringing on partners or angel investors to fund your laundromat in exchange for equity stakes.
State/local programs sometimes provide grants supporting business opening and job creation.
A diversified capitalization strategy combining sources lets entrepreneurs fund their venture while optimizing costs.
Payment Processing Considerations
Accepting card payments automatically requires opening merchant accounts:
- Work with credit card processors familiar with unattended laundries like ESP, Laundrylux, AccessLaundry or Intuit.
- Choose processors offering EMV chip compliance for secure transactions.
- Select equipment that integrates seamlessly with your payment processor.
- Negotiate discounted payment processing rates given your transaction volumes.
- Ensure internet is stable and offers redundancy to avoid service disruptions.
- Have protocols for orderly closeout/settlement at end of each day.
- Leverage integration providers to centralize data and optimize accounting.
- Use laundromat management software providing real-time sales transparency.
- Consider offering contactless payments like Apple Pay and Google Pay.
Seamless payment acceptance keeps machines functioning and improves customer satisfaction. Choose a proven laundry payment processing partner.
Creating a Brand Identity
Developing a strong brand includes:
Convey your laundromat’s unique attributes and value proposition like quality, service, innovation.
Work with a designer to create an appealing logo evoking a professional, trustworthy image.
Select branding colors complementing your logo and location décor – cool blues and greens portray cleanliness.
Carefully Chosen Name
Pick an intuitive, memorable name aligned with your brand identity. Check name availability.
A memorable slogan like “The Best Laundry Experience!” reinforces positioning.
Branded items like laundry bags, pens or caps extend visibility.
Invest in interior/exterior signage using fonts, colors and styles on brand.
Consistent branding boosts recognition. Design all aspects to reinforce the desired image.
Creating a Website
An informative website helps attract and retain customers:
- Showcase location hours, amenities, equipment and unique offerings
- Highlight promotions and specials to drive visits
- Share FAQs addressing common customer questions
- Offer program enrollment like loyalty cards
- Enable site-wide online laundry card reloading
- Feature webcams showing real-time laundromat availability
- Allow booking certain machines like extra large dryers
- Provide easy contact options for questions
- Link to social media accounts like Facebook and Instagram
- Optimize site for local SEO with schema markup
Make your website a valuable resource for maximizing customer convenience.
Sales and Marketing Strategies
Marketing boosts exposure among potential customers:
- Promote grand opening with giveaways, contests and special deals
- Offer loyalty programs giving rewards for frequency like free washes
- Run monthly promotions like discounts on slow weekdays
- Leverage social media platforms like Instagram and TikTok to give business personality
- Claim online profiles on platforms like Google, Yelp, YellowPages
- Distribute flyers and door hangers in nearby neighborhoods
- Advertise in local publications and community calendars
- Sponsor summer community events to demonstrate investment
- Partner with apartment complexes to be recommended laundry facility
- Provide referral rewards to customers who recommend you
- Send direct mail postcards when nearby households move in
Multichannel marketing provides continual visibility among local residents and businesses needing laundry services.
Hiring and Training Personnel
Staffing unattended laundries involves:
- Hiring an on-site manager to handle daily operations, maintenance, customer service
- Employing part-time weekend attendants to provide supervision and service
- Bringing on floated staff during peak evenings and weekends for oversight
- Using a residency program where your manager lives on-site for security
- Running background checks on all hires interacting with customers
- Creating training programs on machinery, safety, cleaning, customer service
- Maintaining staff communication lines like apps for updates between shifts
- Providing bonuses and perks tied to shop performance metrics
- Reviewing monitoring footage periodically to coach service enhancements
Hire for attitude and train for skill. The right staff keeps operations running smoothly.
Pricing Strategies and Profits
Pricing for profitability while staying competitive includes:
- Setting per load prices slightly above competing laundromats
- Offering discounts like 5-10% lower for loyalty program members
- Incentivizing larger loads with tiered pricing – $x for 1-20lbs, $y for 20-40lbs etc.
- Making dryer time affordable enough for full drying without wet loads removed
- Building in profit padding on programmable reloadable cards beyond actual costs
- Instituting small fees for programs like SMS laundry reminders
- Providing monthly unlimited wash plans to apartment complexes
- Ensuring weekend or overnight pricing remains profitable with reduced staffing
- Adjusting prices modestly each year to account for increasing expenses
- Monitoring daily sales and machine usage metrics to identify pricing optimization opportunities
Savvy pricing tactics can significantly boost laundromat profitability long-term when executed thoughtfully.
Maintaining a Welcoming Environment
Operational practices keeping your laundromat inviting:
- Promptly wipe spills, empty trash, spot mop, and replenish soap/fabric softener
- Schedule thorough daily closing cleanings when customer traffic is low
- Perform deep monthly maintenance cleaning days
- Establish preventative maintenance routines to minimize downtime
- Quickly wipe machines if notices during business hours
- Keep restrooms meticulously sanitized and well-stocked
- Maintain pleasant ambient temperatures – cool in summer, warm in winter
- Play popular radio stations and set TVs to family friendly channels
- Maintain well-lit interior and exterior lighting for safety
- Offer free WIFI and device charging ports for customer convenience
- Provide small play area for kids with books and toys
Daily focus on cleanliness, maintenance and hospitality keeps customers coming back.
Legal and Insurance Considerations
Important aspects like business formation, insurance, licensing, and compliance include:
- Forming a legal business entity like an LLC
- Obtaining necessary local and state licenses for laundromat operation
- Carrying adequate commercial property insurance on assets
- Maintaining proper commercial general liability coverage
- Complying with ADA accessibility requirements
- Passing fire and safety inspections regularly
- Installing security systems, fire suppression, emergency lighting
- Checking for local regulatory limits on hours of operation
- Understanding washers warranty coverage, replacement parts availability
- Clearly marking required legal notices like video surveillance
Consult qualified insurance agents, attorneys and contractors to ensure full legal and safety compliance.
Optimizing Profitability Over Time
As your laundromat matures, refine operations to maximize profit:
- Track machine usage and individual machine revenue to determine ideal replacements
- Renegotiate credit card processing rates based on higher volumes
- Explore installing bill changers and coin laundry to retain some coin business
- Add related profit centers like self-service lockers, vending machines, drop-off wash/fold
- Engage customers through loyalty programs, contests, giveaways
- Launch an app for reloadable cards, notifications, real-time occupancy views
- Adjust attendant shifts as data reveals peak traffic patterns
- Upgrade equipment progressively to latest efficient models
Continuous improvement over time optimizes profitability and service quality.
How much does it cost to start a laundromat?
Plan on $250,000 – $500,000 to cover leasing, equipment purchases, permitting, professional fees, inventory, marketing, staffing, insurance, working capital.
What is the ideal size for a coinless laundromat?
Aim for 10-20 washers and 10-15 dryers initially. Leave room to add 5-10 machines over 1-2 years as demand grows.
What are the best locations for laundromats?
High visibility areas along commercial corridors near multifamily housing or colleges offer the most customer density.
What are the busiest hours?
Peak times are typically weekends and evenings when busy families and professionals tackle laundry. Staff attendants accordingly.
How do you choose washers and dryers?
Evaluate commercial brands on longevity, reliability, efficiency, programming capabilities, warranty terms, and service support.
What are the main challenges?
Challenges include securing financing, picking equipment, hiring/training staff, minimizing downtime, establishing processes, controlling costs, and responding to changing markets over time.
The growing popularity of cardless coinless laundries provides encouraging opportunities for entrepreneurs. By combining strategic site selection, great design, reliable equipment, technology integration, solid hiring, and customer-centric policies, coinless laundries can generate attractive risk-adjusted returns. Significant effort is required, but the essential and flexible nature of laundromats creates a continually in-demand service. With dedication and business acumen, aspiring owners can clean up with the coinless laundromat model.
Disclaimer: This article is intended for informational purposes only and does not constitute professional legal or financial advice. Perform thorough due diligence before starting any business.