Small Business Loans for Laundromats
Shield Funding has been working with business owners for over a decade to help them run and expand their businesses. We understand what you need to succeed in the laundromat business, and we can help.
Laundromats are often seen as safe money-making ventures. Everyone needs to do laundry, and not everyone wants to do it at home. It’s a safe bet, right? In most cases, yes. But there are some difficulties that you’ll run into along the way—difficulties that require some extra cash.
If you get the business funding you need to provide great service, there’s the opportunity for great profit. But you’ll need to invest in the right things to make it happen. Not everyone can afford to make that kind of investment—which is why we provide private business loans for laundromat owners. The process is fast and flexible, and you can receive funding even if you have bad credit. Get started on expanding your business with an immediate business loan. Below is a list of the requirements to get approved for business funding with our most basic program. There may be additional factors that are considered, meeting these three requirements though gives you a very high chance of having your application approved.
What Do I Need to Qualify?
Below is a list of the requirements to get approved for business funding with our most basic program. There may be additional factors that are considered, meeting these three requirements though gives you a very high chance of having your application approved.
Here are some business funding options we offer for laundromats.
Small business term loans are the “standard” loans you’re familiar with. You get a lump sum of money to use for anything related to your laundromat. Then you pay it back in monthly installments with interest.
You can use these for adding new machines, expanding your services, keeping supplies in stock, or even buying a new building. If it’s a business expense, our small business loans can help with it. And with up to $1,000,000 in funding, you can aim high.
All you need to qualify is a credit score of 500 or higher, two months in business, and $8,000 in monthly revenue. Depending on your qualifications, you could get interest rates as low as 5%.
Laundromat owners come from all walks of life—and they have a wide range of credit scores. Just because you don’t have great credit doesn’t mean you shouldn’t be able to buy new washers and dryers or expand your service offerings.
Which is why we work with borrowers who have bad credit. As long as your credit score is 500 or higher, you can qualify for a loan from Shield Funding. Traditional lenders require borrowers to have great credit—but as an alternative lender, we can be more flexible.
And you can still get up to $1,000,000 to run or expand your laundromat. You only need two months in business and $8,000 in monthly revenue. Even with bad credit, you can qualify for rates as low as 12%, making borrowing affordable.
Successful laundromats can have high profit margins; sometimes in the range of 30–35%. And when gross revenue can exceed $500,000, that’s a lot of money coming in. If your business is this successful, there’s a good chance that you have cash on hand to grow your business.
Because of that, if you decide to get some help with a loan, you’ll probably be able to pay your loan back quickly. In these cases, short-term business loans are a smart choice.
These are loans with terms from 6–24 months. You can still get up to $1,000,000 at interest rates as low as 9%. As long as you’ve been in business for a year, bring in $10,000 of monthly revenue, and have a credit score of 650, you can qualify.
Your customers depend on your equipment. If it breaks or needs to be serviced, you’re going to lose business. Unfortunately, most traditional lenders take weeks to get you an approval and even longer to deposit your money.
A business line of credit is like a credit card; you can use it when you want, and you only pay installments and interest on what you borrow. That means you have access to cash when you need it, but you don’t have to pay interest if you haven’t used it. Which is perfect for when something goes wrong.
Our business lines of credit give you access to up to $250,000 at interest rate from 5–10% (much lower than a credit card). You’ll need to have been in business for six months and bring in $10,000 in monthly revenue. If you satisfy those conditions and have a credit score of 650 or higher, you can qualify for a business line of credit.
Not sure where you would put this money to use? Here are some ways to invest money in your laundromat business.
Create a Great Customer Experience
Running a successful laundromat has changed. No longer can you rent a dingy building, fill it with washers and dryers, and occasionally have an attendant on duty. Modern laundromats often include amenities that improve the customer experience.
It’s not hard to find laundromats with coffee for purchase, multiple attendants, and even a kids’ area where parents can let their little ones play while they get their laundry done. Some even have snack bars or small shops for added convenience.
Unless you’re the only laundromat in town—which is increasingly unlikely—you have to compete with other businesses offering these amenities. The laundromat business is a saturated market, and competition is fierce.
Adding these services might include expanding your building, purchasing more land, hiring more staff, and doing major renovations. None of those are cheap, but a great customer experience is the absolute best thing you can invest in as a business owner.
Expand Service Offerings
Self-serve laundry is your main business. But busy professionals and urban dwellers are willing to pay top dollar for additional services. Laundry can be time-consuming, so why not allow your customers to drop off their laundry and pick it up after it’s been washed and folded?
You could even go a step further with pickup and dropoff. Or add dry cleaning to your offerings. The more convenience you can offer, the better.
Of course, none of this is cheap. Pickup and dropoff require business vehicles and more employees. Dry cleaning supplies will add to your monthly expenses. You may need more equipment, too.
But these investments will absolutely pay off. They’ll let you capture new markets and better serve the ones you’re already in. Taking a business loan to buy new equipment or pay new employees will help you much more in the long term than it will cause inconvenience in the short term.
Add and Maintain Equipment
Commercial washing machines are expensive; you can pay up to $20,000 for a single unit. Adding more machines to your facility or outfitting a new one can run to hundreds of thousands of dollars.
But having the right equipment is non-negotiable. If your machines are outdated, often broken, or overused, you’re going to lose business. Even a single machine going down can increase wait times during busy periods.
Having an adequate number of machines is crucial. But so is maintaining those machines. There’s nothing worse than going to a laundromat and seeing that half the machines are out of order. If this happens, you can expect to lose business.
That’s why having quick access to credit is so important. When a machine goes down, you need to be able to get it repaired as quickly as possible. Business lines of credit help immensely in keeping cash available.
Offering Additional Supplies
Visitors expect that you’ll have laundry detergent, fabric softener, and dryer sheets available. But you can go above and beyond to provide better service by offering a wider selection of laundry supplies.
For example, adding a line of additive-free detergent will appeal to people with sensitive skin. Eco-friendly supplies will help you attract and keep business from eco-conscious consumers. Presoak products, different scents of fabric softeners, and other options help you stand out to people who need more than just one type of detergent.
You’ll have to keep these supplies in stock, which is one expense. But you’ll also need a way to sell them, which adds another factor. Will you purchase several thousands of dollars’ worth of dispensing machines? Install full vending machines for a wider variety of products? Or open a small store?
Whatever you decide, offering more options is almost always a good idea. Unless you serve a very specific crowd, you can appeal to a wider audience with additional types of laundry supplies.
If you need financial help running or growing your laundromat business, we can help. Get in touch today and we’ll chat about which funding options best suit your business.