Seeking advice

[bargug]

I am looking to buy a mat and I came accross one that has 11 18lb loaders, 2 35 lb. loaders and 10 dryers made by Laundercenter. The current owner has let the business slide for heath reasons. I have been able to verify the monthly operating expenses to be 3,650 per month but the current revenue is only 2,100 per month. She is asking only 35K for the mat. Do you think it wise for a first timer to buy something that has gone by the wayside for a low price or pay a higher price for something that is not loosing money. As I am a newbie I am seeking advice.

[Ken]

Laundercenter washer was made by IPSO,not bad machines.
Don't know who made their dryers but only 3 companys still in coin op dryer business anyway.
Check the rent and the lease.

[Winston]

If the business is losing $1550 a month, the "seller" should almost be willing to give the business to you if you will take over the lease.

Remember, in buying an existing laundromat you are buying cash flow. The equipment is only worth
1) its salvage value or
2) the income it can generate.

[pete f]

If the business is losing $1550 a month, the "seller" should almost be willing to give the business to you if you will take over the lease.

Remember, in buying an existing laundromat you are buying cash flow. The equipment is only worth
1) its salvage value or
2) the income it can generate.

I agree, ...
but I will tell a short story. Not long ago my wife wanted to buy a bar for her daughter, we found one nearby, only asking 25k. It did not make any money, had about the same prospects as the mat you mentioned. We passed on the deal. 3 months later, he is gone, the building is for lease, still no takers, even for "free"

Mat are a little different, some ragged ones can be re done with new stuff and become winners. You have to determine if the market is there. If the machines are very old, and a high density renter base, then MAYBE 35k is ok becuase of the high cost of infustructure, ie, plumbing, electric, impact fees, etc, to build a mat. Still she should be willing to sign it over just to get out of the red ink...and plan on spending bucks to get the place back in business.

[smellysocks]

you have to do your research on how much can you improve the business, compition, demo, if your in new york you should have MSKlaundry take a look at the equipment. It might be worth 35k to little info to help on that. i bought existing mat and double business in 6 months, sold and made a ton of money, same thing but it was making money but absentee owner. 35k is nothing when you talk about laundromats, my water bill is almost that. Have in in the lease to be able to get out fast if you have too. The laundrocenter machines are work horses. good luck keep us posted

[MichaelCa]

Take a look at the 2 very closest Lmats - find out how much they're doing (from their water bill), then ask to see her books from say 3 years ago (i.e. when her health was good) AND get her water bills (From back then)for confirmation.
This will tell you what share of the market "Pie" she USED to have....AND THEN add up the total current Revenues from:
1.) Mat 1
2.) Mat 2
3.) Her Mat
= Total "X"
Subtract what she used to do from "X", then compare that amount with what the neighbor Mats are currently doing: The difference is a very good measure of the Pie that would come back to you if you clean up the place. Those people didn't vanish.


Other things:
-You didn't mention anything about the lease - if she's on month to month, then its worth NOTHING except purely about how much the machines are worth.
If she's got a long lease at a good price, then there's high value in that.

-(Laundercenter) IPSO dryers *were* made by Cissell.