How to Start a Laundromat Business: A Step-by-Step Guide

Nate Jones, CPCU, ARM, CLCS, AU
Nov 3
3 min read

Starting a laundromat business can be a profitable and recession-resistant venture. With the right planning, equipment, and insurance, you can build a semi-passive income stream that serves a vital community need.

At Wexford Insurance, we specialize in helping laundromat owners protect their investments with tailored insurance solutions. Whether you're opening your first location or expanding your operations, this guide will walk you through the essential steps to get started.

Step 1: Research the Market

Begin by analyzing your local market. Look for areas with:

High renter populations
Limited access to in-unit laundry
Proximity to apartment complexes, colleges, or urban centers

Use tools like the U.S. Census Bureau’s Data Portal to explore population density, income levels, and housing types in your target area.

Step 2: Choose a Business Model

Laundromats typically fall into three categories:

Self-Service (Coin or Card Operated): Minimal staffing, lower overhead
Full-Service: Offers wash-and-fold, dry cleaning, or pickup/delivery
Franchise: Operate under a known brand with built-in support

Each model has different startup costs and operational needs. Choose the one that aligns with your goals and resources.

Step 3: Create a Business Plan

A comprehensive business plan should include:

Market analysis
Startup and operating costs
Revenue projections
Marketing strategy
Insurance and risk management plan

This document is essential for securing financing and guiding your business decisions.

Step 4: Estimate Startup Costs

According to NerdWallet, opening a laundromat typically costs between $200,000 and $500,000, depending on location, size, and equipment. Key expenses include:

Leasing or purchasing property
Renovations and utility upgrades
Commercial washers and dryers
Licensing and permits
Marketing and signage
Insurance coverage

Step 5: Secure Financing

Explore funding options such as:

SBA loans
Equipment financing
Business lines of credit
Private investors

Having a detailed business plan and financial projections will improve your chances of approval.

Step 6: Choose the Right Location

Location is critical. Look for:

High foot traffic
Easy parking and accessibility
Visibility from main roads
Adequate plumbing and electrical infrastructure

Step 7: Purchase Commercial Laundry Equipment

Invest in reliable, energy-efficient machines. According to The Laundry Boss, top commercial brands include:

Speed Queen
Maytag
Electrolux
Dexter
Huebsch

These machines offer durability, smart features, and lower utility costs—key for long-term profitability.

Step 8: Get the Right Insurance Coverage

Protecting your investment is essential. At Wexford Insurance, we offer specialized coverage for laundromats, including:

General Liability Insurance – Covers injuries or property damage on your premises
Commercial Property Insurance – Protects your building, washers, dryers, and other assets
Workers’ Compensation Insurance – Required if you have employees
Commercial Auto Insurance – For pickup and delivery services
Equipment Breakdown Insurance – Covers repair or replacement of machines due to mechanical failure

Step 9: Market Your Laundromat

Use a mix of online and offline strategies:

Create a Google Business Profile
Launch a website with SEO-optimized content
Offer grand opening promotions
Partner with local apartment complexes
Use social media and local advertising

Market Your Business with Contractor Back Office

Struggling to get your business noticed? Contractor Back Office helps businesses build a strong brand, attract more customers, and run more efficiently with smart digital tools and expert support.

Our Services Include:

Step 10: Launch and Optimize

Once open, focus on:

Cleanliness and maintenance
Customer service
Adding services like vending machines, Wi-Fi, or loyalty programs
Monitoring utility usage and machine performance

Final Thoughts

Starting a laundromat business is a significant investment, but with the right planning and protection, it can be a highly profitable and stable venture. At Wexford Insurance, we’re here to help you navigate the risks and secure the right coverage for your laundromat.

Contact us today.