Hello!

[TotoMongo]

I just recently found this site and would like to thank everyone for the great advice they have taken the time to write. It is
invaluable and much appreciated!

I am considering buying a laundromat in the NYC area. Would you please help evaluate some fundamentals and maybe
comment on my goals? I purposely looked for a lower revenue mat because my goal is to expand the business by pick up and
delivery. At the moment the mat is staffed by a full time attendee who doesnt speak english (yes, I know that will be a problem). She keeps the little drop-off the store currently has. My plan is to pick up and deliver in mid-to-upper income areas and charge 85-95 cents/lb. I have never owned a business and am very excited about my opportunity. I have searched and researched laundromats for six months and feel I am ready (are you ever really ready?).



Some stats (all I have at the moment):

1600 square feet
1600 coin/week
4145 expenses/month
2788 net/month
33456 net/years
$200-300 drop off to attendant/week
1500 payroll/month
IPSO equip is 1 yrs old
2x 50# 1 YEAR OLD IPSO
8X 18 1 YEAR OLD IPSO
6X35 1 YEAR OLD UNIMAT (sp)
16 dryers (unsure of brand - double stack)
8x12 room in back for storage (has A/C, microwave, and table for dropoff storage)
Rent:1500/mo 10yrs lease

LATEST UTILITIES (what other utilities are there and how many years should I ask copies of?):

Keyspan Gas $1049/ 2 months
Water $1011.00/3 months
Con Ed $251/month


Other details and questions:

1. I plan on allowing the attendant to keep the drop off. Three peopel told me I was crazy for doing so - especially as she doesnt speak english and I will definitely need someone for the phones. The alternative is to retain a reliable answering
service ( which I think is a very good idea). They are cheaper than help and can be very courteous and professional. The
downside is as tehy are detached from the business, they may run into questions they cant answer or may just not care
enough to be the best they can be.

2. I have been to the apartment buildings in wealthier neighborhoods. I am considering giving the doormen 10% of each sale. My reasoning: I wouldnt have to go door-to- door and waste time. Customers would drop off bags at his station. It would also give me a centralized area to advertise in each building: buttons, postcards on his desk and flyers. I have had good feedback from doormen about this.

3. The apartments without doormen: My plan is to give the super a bit ($10, 20?)to allow me to sit in his lobby on a saturday
morning and sell my business. Again, a chance to distribute flyers, have the customers attach a nice face behind to the
service, and allow potential customers to hear why I can service them better than the guy down the street. I plan on getting a
logo to identify myself and the business.

4. Should I get a van? I think the opportunity to advertise in BIG BOLD LETTERS while driving through the target areas
would be invaluable. Then again, it would mean getting a commercial licence, plates and insurance. I am not against the cost of the commercial aspect of the van. In this city though, commercial vehicles can only drive on expressways. If I dont get a van, I wiil buy a large station wagon. Anyone have one in mind that can accomodate my needs?

5. I visited the laudromat 3 blocks from me and was told that they also grossed 1600 week. That gives me a bit of comfort as
this is consistent with the one i am looking at.

6. I would like to retain the services of Gary Ruff. He is a(n) attorney/consultant who specializes in mats. I read about him
here and visited his website. I was impressed. http://www.laundromatadvisor.com/
Tell him you saw his link on Coinwash.com

Although I have so many more questions, I think I have rambled on enough for one post. Your advice and thoughts are much
appreciated!

Toto

[MSKLAUNDRY.]

First of all, your thought of charging 85 cent or higher is not going to go all that well unless your store is located in midtown Manhattan or if you are doing pickup/delivery there. The current price is about 50 cents a pound in the congested low to middle income areas with a lot of competition and the highest I have seen is about 85 cents, in the upscale areas.

Hate to tell you this but English in this city is a second language. Maybe we need to learn Spanish, LOL

What about insurance, garbage, supplies, licenses (consumer affairs), sprinkler, fire extinguisher inspections, equipment repairs. Just to name a few. I normally wouldn't list these petty stuff but in a low income location these little things do add up and become an issue.

$1500 a month for labor? It is obvious they are paid off the books. It amazes me how the seller prices in the so called savings of paying the people off the books into the selling price. You need to figure the actually net based on what you would pay people legally not what is commonly done (off books). I am not saying how to pay your employee but don't pay a premium on something that is not legit. My 2 cents.

[TotoMongo]

Too high, huh? I am worried about covering my costs. I guess I have to find out what the specific costs are associated with pick up and delivery. Thanks for responding!

Fire extinguisher inspections? I would have never thought of asking that.

[Jim]

Your going at about 110 mph .......slow down...6 months is not along time to be studying this business.

Here's some questions for you....

1st... why is the owner selling ?? They have all new equipment, (you state 1 year old)...I have never heard of someone buying all new equipment to sell a biz, unless they just started the biz last year and it's losing money.

2) Don't believe that if another mat is making 1600 per wk. that this one is....

3) You listed expenses of $4145. per month...What does that include? You have payroll and rent listed seperatly..are they included..your numbers don't seem to jive here??

4) What is the mat grossing ?..Looking at the utility bills I get a gross of approx. 60K

5) What are they asking for the mat ?

6) I have heard of Gary Ruff...he is a self proclaimed expert...in other words he knows a little bit more about mats than newbies...Remember..he is in business to make money just like the rest of us...I would not trust anyone elses opinion but my own, when it comes to spending my money.

7) Don't be in a hurry...do your due diligence... don't believe what the numbers are until you see it yourself.

Sidebar: I just turned down buying a mat from a couple that want to retire... They where lying about everything...they even peppered the boxes and wanted me to come in and check to see all the money they where making....

[TotoMongo]

Hi Jim. Thanks very much for your thoughts. As it is easiest, I will answer point by point.

1. The broker told me the owner is selling because he is retiring and no longer wants to operate laundromats. Hmmm, I never related the fact that he selling a store with practically brand new equipment.

2. As for my comment about the other mats' income, rest assured that I dont place much confidence that it carries much weight with respect to the one I want to purchase. But it does lend credence to the fact that being the same size and area, if they are doing the same type of service, one should be doing relatively the same as far as expense and income. No?

3. Yes, the $4145 includes all expenses, i.e. payroll, rent, utilities, etc.

4. The mat grosses 1600 coin/week, plus and avg of 250/week wdf. Hmm, you are on to something here. If utilities are 1/4 of gross (as a rule, right?) then the gross s/b near what you said: $57876. Using the numbers he gave me, the store grosses approximately: $96,000. In other words, wildly off. If true total expenses are 4145/month and revised gross is less than $5000 - I get the point now.

5. They are asking 75k for the store. Based on the above realization, this number is much too high.

6. Believe me, in the end Gary Ruff's opinion will only serve to buttress mine.

7. God, this is a long and frustrating process!

Jim, thanks for making my mind work a bit better!

[Jim]

I'm glad I could help....Thats what we are here for.....

The expenses still do not add up at $4145.00

Utilities (gas,water,elec) = 1112.5 per
Payroll = 1500.
Rent =1500.
Total 4112.5

now what about all the other expenses as in:
Telephone, Cable, Taxes, and everything MSK said.

With the numbers he gave you the expenses are too low and the gross is too high........

Plus you now have to add in the price of the mat over x amount of years....Now it's starting to look like this mat is losing money to me.

aka.... don't walk from this deal....RUN !!

[Kitty]

What is the equipment mix and vend prices?

[TotoMongo]

Not sure yet Kitty. Owner gets back from vacation next week so I will let you know.

[pete f]

how many gallons of water used? not knowing the price per gallon makes any guess hard. Using gas comsumption it is possible for around 6k mo in coin, but w/d/f is mixed in, so is harder to figure.
Is the mat near your place of residence? Is it near apartments? Does it have good parking? I would not worry why the sellers are selling, I never have asked. Study and see what it is worth to you. Do not pay for "potential" but always buy it. New machines are worth something.

See if you can get water usage from last year or the year before. More used? Less? see if it is steady.

[MarkE]

6) I have heard of Gary Ruff...he is a self proclaimed expert...in other words he knows a little bit more about mats than newbies...Remember..he is in business to make money just like the rest of us...I would not trust anyone elses opinion but my own, when it comes to spending my money.
On a similar note: I have contacted both Gary Ruff and Brian Brunckhorst with what I thought were very easy straight forward questions and have never heard back. I have been looking for a second opinion myself and the pickings are slim if you know what you want.