Is Owning a Dry Cleaning Business Profitable?

Nate Jones, CPCU, ARM, CLCS, AU
Nov 5
2 min read

If you’re considering starting or buying a dry cleaning business, profitability is likely your biggest question. Dry cleaning can be a steady and lucrative industry because people consistently need professional garment care for suits, dresses, and specialty fabrics.

At Wexford Insurance, we work with dry cleaners, laundromats, and garment care businesses to help protect their operations from everyday risks. Understanding profitability involves looking at revenue potential, operating costs, and risk management.

What Determines Profitability in Dry Cleaning?

1. Revenue Streams

Dry cleaning businesses earn income from:

Garment Cleaning Services – Core service for everyday and specialty clothing.
Alterations and Repairs – Adds extra revenue and customer convenience.
Pickup and Delivery Services – Premium service that attracts busy clients.
Commercial Accounts – Hotels, restaurants, and offices often require bulk garment care.

2. Startup and Operating Costs

Profitability depends on managing costs effectively:

Equipment Investment – Dry cleaning machines, pressing equipment, and conveyors.
Rent and Utilities – Location impacts overhead significantly.
Labor Costs – Skilled staff for garment care and customer service.
Cleaning Supplies and Chemicals – Must meet safety and environmental standards.

You can estimate your initial investment using the SBA startup cost calculator to plan your budget effectively.

3. Pricing Strategy

Competitive pricing is key. Many dry cleaners use tiered pricing for specialty garments and offer discounts for bulk orders or loyalty programs.

4. Customer Retention

Repeat customers drive profitability. Offering loyalty programs, excellent service, and convenient options like delivery can boost retention.

According to Harvard Business Review, increasing customer retention rates by just 5% can raise profits by 25% to 95%.

Challenges That Impact Profitability

Equipment Breakdowns – Can halt operations and lead to lost revenue.
Property Damage – Fire or water damage can disrupt business.
Garment Claims – Customers may file claims for damaged or lost items.

Protect Your Business with Insurance

Insurance plays a major role in maintaining profitability by reducing financial risks. Wexford Insurance offers coverage tailored for dry cleaning businesses:

General Liability Insurance – Protects against third-party injury or property damage claims.
Commercial Property Insurance – Covers your building, equipment, and inventory.
Equipment Insurance – Protects against breakdowns of dry cleaning machines and pressing equipment.
Workers’ Compensation – Provides coverage for employee injuries on the job.
Commercial Auto Insurance – If you offer pickup and delivery services.

Final Thoughts

Owning a dry cleaning business can be profitable if you manage costs, maintain quality service, and protect your operations with the right insurance. For tailored coverage that keeps your business secure, contact Wexford Insurance today to get started.