How to Start a Laundromat Business in 6 Steps
Learn how to start a laundromat business in 6 steps — from choosing your business model and writing a plan to getting permits, buying equipment, and forming your LLC.
Bizee Editorial Staff
Editorial Team
Introduction
Starting a laundromat business means choosing a business model, finding the right location, securing permits, buying commercial equipment, and forming a legal entity. The laundromat industry has been around for decades and remains in steady demand — making it one of the more resilient small businesses you can open.
Step 1: Choose your laundromat business model
The first decision is whether to run a self-service laundromat, an attended laundromat, or a hybrid that combines both. Each model has different labor requirements, startup costs, and revenue potential — and the right choice depends on your location, budget, and how involved you want to be day to day.
Self-service laundromat
Customers use coin-operated or card-operated machines on their own. This model works well in high-traffic areas near apartment buildings. Labor costs are low, but you're responsible for maintenance and keeping machines running. Most self-service laundromats are largely passive once they're up and running.
Attended laundromat
Staff are on-site to assist customers, handle drop-off laundry, and offer value-added services like dry cleaning pickup or vending. Attended models suit commercial districts and can generate more revenue per customer. The trade-off is higher labor costs — federal minimum wage is $7.25 per hour, though many states set a higher rate.
Hybrid model
Many laundromats combine self-service machines with drop-off laundry services to build multiple revenue streams. This is a common approach for owners who want the volume of self-service with the higher margins that come from wash-and-fold or drop-off work.
Step 2: Research the laundromat industry
Before you sign a lease or buy a single machine, spend time understanding the market in your target area. Laundromats are location-dependent businesses — a site that works well in one neighborhood can struggle two miles away. The SBA's market research resources are a good starting point for sizing up local demand.
Look at the density of rental housing nearby, the number of existing laundromats, and whether the area is underserved. Census data can help you figure out household income levels and renter-to-owner ratios — both strong indicators of self-service laundry demand.
The laundromat industry has a reputation for stability that most retail businesses don't enjoy — people need clean clothes regardless of the economy.
Step 3: Plan your laundromat business
Planning a laundromat means working through location, buildout requirements, equipment costs, and utilities before you commit to a space. These decisions are interconnected — the wrong building can make your buildout costs prohibitive.
Location and buildout
Commercial laundry equipment is heavy — machines can exceed 500 pounds each, so the floor needs to handle that load. You'll also need water supply lines large enough to support multiple machines running at once, typically 1 to 2 inches in diameter with flow rates of 20 to 30 gallons per minute per machine. Buildout plans require permits for plumbing, electrical, and structural work, which vary by local jurisdiction.
Equipment
High-efficiency commercial washers use less water and energy than older machines, and many qualify for utility rebates and incentives through ENERGY STAR. That can meaningfully reduce your operating costs over time. Your HVAC system also needs to handle the humidity that dryers produce — commercial dehumidification and ventilation are typically required to meet building codes.
Step 4: Write a business plan
A business plan forces you to put numbers behind your assumptions — and for a laundromat, the numbers matter more than the narrative. Lenders and investors want to see projected revenue, startup costs, and how long it will take to break even. The SBA offers a free business plan template that covers all the standard sections.
Your plan should cover your business model, target location, equipment costs, buildout estimates, projected revenue per machine, and ongoing expenses like rent, utilities, insurance, and maintenance. If you're planning to hire staff, include labor costs. Most laundromats have an average return on investment of 20 to 35%, but that range is wide — your specific numbers depend on location, machine count, and how you manage overhead.
Step 5: Set up your laundromat business
Setting up your laundromat as a legal business entity protects your personal assets and makes it easier to open a business bank account, apply for financing, and hire employees. Most laundromat owners form an LLC because it separates personal and business liability without the complexity of a corporation.
Beyond forming your entity, you'll need to get an Employer Identification Number (EIN) from the IRS — you can apply at irs.gov and get your EIN the same day if you apply online. You'll also need to check your local and state requirements for business licenses and permits. Laundromats typically need a general business license, a sales tax permit if you sell products, and any local permits tied to your buildout.
Getting the permits right before you open is much easier than correcting problems after the fact — local building and zoning offices can tell you exactly what's required for your address.
Step 6: Hire employees
Not every laundromat needs employees from day one. Self-service models can run with minimal staff, while attended models and drop-off services require people on-site. If you do hire, you'll need to register for payroll taxes, set up workers' compensation insurance, and follow federal and state wage laws.
The Bureau of Labor Statistics publishes wage data by occupation that can help you budget realistic labor costs for your area before you commit to an attended model.
Online resources for laundromat owners
These sources are worth bookmarking as you plan and build your laundromat business.
- SBA business plan guide — free templates and guidance for writing a laundromat business plan
- SBA licenses and permits — a starting point for figuring out what permits your laundromat needs
- ENERGY STAR commercial washers — information on high-efficiency equipment and utility rebate eligibility
- EPA WaterSense at Work — water use benchmarks and efficiency guidance for commercial laundry equipment
- DOL minimum wage — current federal minimum wage rates and state-by-state comparisons
Frequently asked questions
Start by choosing your business model — self-service, attended, or hybrid. Then research your target location, write a business plan with projected costs and revenue, secure permits and licenses, buy or lease commercial equipment, and form a legal entity like an LLC. Most owners also apply for an EIN from the IRS before opening.
Opening a laundromat requires finding a suitable commercial space, completing buildout work (plumbing, electrical, flooring), getting local permits, installing commercial washers and dryers, and setting up your payment systems. You'll also need to form your business entity and get any required business licenses before you open to the public.
You need a commercial space with adequate plumbing and electrical capacity, commercial washers and dryers, a payment system (coin, card, or both), local business licenses and buildout permits, and a legal business entity. If you plan to hire staff, you'll also need to register for payroll taxes and set up workers' compensation insurance.
It depends on your location. Most laundromats need a general business license, plumbing and electrical permits for buildout work, and a certificate of occupancy from your local building department. If you sell products like detergent or snacks, you may also need a sales tax permit. Check with your city or county business office for the full list.
Startup costs vary widely based on location, building condition, and equipment choices. A new laundromat buildout with new commercial equipment can run from $200,000 to over $500,000. Buying an existing laundromat is often less expensive and comes with an established customer base. Your business plan should include detailed cost estimates before you commit to a space.
Yes, laundromats can be profitable — most have an average return on investment of 20 to 35%. A coin-operated laundry facility can generate anywhere from $15,000 to $300,000 per year in revenue, depending on location, machine count, and services offered. Profitability depends on keeping overhead — rent, utilities, maintenance, and labor — in check relative to revenue.
The main ongoing costs are rent, utilities (water and electricity are the biggest), insurance, and machine maintenance. If you hire employees, wages are a significant ongoing expense. Laundromats that sell products also carry inventory costs. Utilities tend to be the most variable cost — high-efficiency equipment can reduce water and energy bills over time.
Yes. At minimum, you'll need a general business license from your city or county. Depending on your location and buildout scope, you may also need plumbing, electrical, and building permits, plus a certificate of occupancy. Some states have additional requirements for commercial laundry operations. Check with your local business licensing office before you sign a lease.
