Becoming A Multi Store Operator: Financing Your Next Store

Making the decision to expand your laundry business to a second location is an exciting milestone! Although, there’s a wide berth between wanting to scale and successfully opening another storefront, which is why you need to go into this with a strategic plan. One of the major hurdles in this process is figuring out how to finance the venture in a way that makes sense for you and your business goals. In this blog post, we’ll give you actionable steps to choose laundromat financing strategies for your next location with minimal upfront costs, empowering you to grow your empire without taking on too much financial risk.

Ready to take control of your laundromat from anywhere? Download our guide to remote management and learn how to optimize your operations, increase efficiency, and boost profits—all without being on-site!

Knowing when it's time to buy another location

You’re a master of the day-to-day operations of your current store. But do you ever wonder how to know when it’s the right time to expand? Timing is a key when considering your next big business move. There are a few indicators to look out for to help you decide if now is the time to take the leap:

1. Performance of your existing laundromat: It may be time to open another laundromat if your current one is consistently hitting or exceeding its financial targets, and your business runs well even when you’re not on-site. If your store is profitable and there’s sustained demand in your area, these factors could signal that the market is ripe for another location.

2. Your readiness as an owner: Managing multiple stores requires a different approach. Intrinsically, it will require less hands-on management to more strategic oversight. Are you prepared to delegate more responsibilities and trust your team to handle the day-to-day without you?

3. Market conditions: Research your target area to be sure there’s enough demand to support another laundromat. Look for underserved communities or areas with growing populations that might benefit from your services. 

Financing Strategies Options for Every Business

If you’re ready to transition from a single-store to a multi-store operation, you’ll have to find the right financing strategy for your goals. The best route will be determined by your current financial position and the state of your existing business. Here are a few tried and true options to help you get to the next step in your business with minimal upfront costs.

1. SBA loan for laundromat: Small Business Administration loans are a popular choice. These are backed by the federal government and come with lower interest rates and more favorable terms than traditional bank loans. One of the most commonly used laundromat business loans for purchasing a laundromat is the SBA 7(a) loan. With down payments as low as 10%, SBA loans can make it easier to finance your next store without depleting your cash reserves.

2. Seller Financing: Seller financing is another solid strategy, especially if you're buying an existing laundromat. In this arrangement, the seller acts as the lender, allowing you to make payments over time rather than getting a traditional loan. This can be particularly attractive  if you have limited access to traditional financing or want to avoid the stringent requirements of bank loans.

3. Partnerships: Forming a partnership is a great way to pool resources and share the cost of expanding your laundromat business. You can partner with an investor, a fellow laundromat owner, or a business-savvy friend, to get ahold of the capital and expertise needed to open your new location.

4. Home Equity and Personal Loans: If you own a home or other valuable assets, you might consider tapping into your personal equity to finance your next laundromat. Home equity loans or lines of credit allow you to borrow against the value of your home, often at lower interest rates than commercial loans. 

5. Equipment Leasing: If you’re really looking to minimize upfront costs, equipment leasing could be a solution. Instead of purchasing all the necessary equipment outright, leasing allows you to spread out payments over time. This can help preserve your working capital for other important startup expenses.

Important considerations for success

There are several factors to think about if you wan to set your new venture up for success. Beyond financing, considerations will help you navigate the complexities of multi-store operations and avoid potential pitfalls.

1. Location: Select a location with favorable demographics, minimal competition, and high foot traffic. Be sure to do in-depth market research and leave no stone unturned. 

2. Operational efficiency: As you expand, consider implementing a centralized management technology so operations can be consistent across locations. This will lead to better customer satisfaction and encourages repeat business.

3. Staffing and management: To effectively manage multiple laundromats, you’ll need a reliable team that doesn’t require constant oversight. This may equate to upskilling your current staff or hiring new employees, along with strong leadership to manage your team and address issues. 

4. Financial management: Maintaining cash flow, managing ongoing expenses, and setting aside reserves is a bigger challenge when it comes to multiple stores. Make sure to scale this as needed to sustain long-term growth for your new laundromat.

5. Brand consistency: A consistent brand image at both of your laundromats is essential to foster trust and loyalty. Keeping your branding on point is the first step to ensuring your customers receive the same high-quality experience at each store.

6. Customer retention and marketing: Retaining customers is arguably more important (and more cost-effective) than acquiring new ones. When you open your second location, consider upping your game with loyalty programs, regular promotions, and strategic marketing to driving traffic.

7. Regulatory compliance: Zoning laws, health and safety regulations, and environmental compliance are tedious but important details to address in the process of opening your second location. The last thing you want is a fine or delay, so take the time to make sure you’re aligned with the relevant laws in your area. 

Scaling Your Business with Technology

As your laundromat business expands to multiple locations, the traditional methods of running a laundromat will become less adequate. This is where modern technology solutions come in. There are two leading solutions that have proven invaluable for multi-store operators, each offering distinct features that simplify everything, enhance customer experiences, and drive growth.

Cents POS: management and growth tools for modern laundromats

Cents Point of Sale (POS) is a true all-in-one toolkit for laundromat owners who are serious about expansion. With Cents POS, you can efficiently manage all aspects of customer transactions, including self-service payments, wash-and-fold, pickup and delivery services, dry cleaning, and beyond. The system supports a variety of payment options, including cash, cards, and mobile payments, providing convenience for customers and reducing the workload on your staff. Beyond transaction management, Cents POS delivers valuable data that helps you track sales trends, understand customer behavior, and easily identify growth opportunities. With a tool like this, you can make data-driven decisions that are sure to boost profitable revenue.

Cents also excels in multistore management, centralizing operations across all your locations into one platform. This system allows you to oversee every aspect of your business from a single dashboard that tracks sales,  machine usage, and staff schedules. A standout feature of Cents is its ability to standardize processes across all stores, that way customers receive consistent service no matter which location they visit. The platform’s remote management capabilities allow for real-time monitoring, making it easier to address issues promptly and maintain operational efficiency as your business grows.

Jason Worme, owner of Star Laundromats, is a prime example of how Cents can transform a laundromat business. Initially overwhelmed by the complexities of managing multiple locations, Jason adopted Cents Connect, which allowed him to streamline his daily processes and introduce a cashless system. Gone are the days of hauling heavy buckets of change! “I think my favorite feature is the fact that I can just be at home, pull reports, and know exactly what’s going on in my stores at any time,” Jason said, emphasizing the control and convenience Cents provided. With Cents Connect, Jason was able to regain control over his time, improve customer service, and focus on strategic growth. 

Laundroworks: a comprehensive solution for multi-store management

Laundroworks is another top-tier solution for forward-thinking multi-store operators. Designed to address the unique challenges of operating more than one store, Laundroworks brings a centralized system that allows you to manage all aspects of your business from a single, user-friendly interface.

One of Laundroworks’ standout benefits is its ability to standardize processes across all locations. This standardization simplifies staff training and strengthens your brand’s reputation by providing consistent service quality. Laundroworks alsovexcels in delivering real-time insights into your business, with reporting and analytics tools that help you make informed decisions to improve efficiency, reduce costs, and drive growth. As one satisfied customer put it, “There will always be problems in your laundromat that are out of your control… Laundroworks solves all my controllable problems.”

In today’s laundry market, the owners who implement the right technology will pull ahead of the competition. Both Cents and Laundroworks provide the flexibility, control, and granular data necessary to scale your business while maintaining the high standards your customers expect. As you continue to grow, choose trusted partners in that are invested in your success and have a proven track record of guiding businesses just like yours to resounding success. 

Ready to take control of your laundromat from anywhere? Download our guide to remote management and learn how to optimize your operations, increase efficiency, and boost profits—all without being on-site!