Industry growth is based on the demographics of population density, population mix, and population income. The more concentrated the population, the greater the need for quality coin laundry facilities. National and regional demographics indicate renters, the primary users of coin laundries, are the fastest-growing segment in the nation. As of the 1990 U.S. Census, 35.8% of the nation’s 94.6 million households were renter occupied, up from 34% in 1980.

 

The number of coin laundry stores built over the past 40 years has grown steadily as the population has increased and shifted to more concentrated areas. The end result has been a mature, stabilized industry with predictable rates of turnover and values of existing coin laundries; development of new “turn-key” facilities; and, equipment expansion and replacement.

 

Marketing Environment

Coin laundries normally sell for a multiple of their net earnings. The multiple may vary between three and seven times the net cash flow, depending on several valuation factors. The following primary factors establish market value:

 

The net earnings before debt service, after adjustments for depreciation, and any other non-standard items # including owner salary, or payroll costs in services.

The terms and conditions of the real estate interest (lease), particularly length; frequency and amount of increases; expense provisions; and overall ratio of rent to gross income.

The age, condition, and utilization of the equipment, and leasehold improvements; the physical attributes of the real property in which the coin laundry is located, particularly entrances/exits, street visibility, and parking. More about Uber for laundry tucson click here.

 

Existing conditions, including vend price structure in the local marketplace.

The demographic profile in the general area or region.

Replacement cost and land usage issues.

This resale market standard assumes an owner/operator scenario, with no allocation for outside management fees. Marketing time for store sales averages 60 to 90 days, depending on price, financing terms, and stores available at the time of sale. Coin laundry listings are generally offered by business brokers who charge a sales commission of 8% to 10%. Most coin laundry distributors also act as brokers.

 

The accepted standard of “useful life” for commercial coin laundry equipment is as follows:

 

Top load Washers (12 lbs. To 14 lbs.) 5 – 8 years

Frontload Washers (18 lbs. to 50 lbs.) 10 – 15 years

Dryers (30 lbs. to 60 lbs.) 15 – 20 years

Heating Systems 10 -15 years

Coin Changers 10 – 15 years

This schedule will vary upon usage, sales volume, and maintenance. “Useful life” may differ for accounting or tax purposes.…

Read More