Essentials Of A Laundry Business Plan
Laundry service has almost become an essential need in today’s world, especially now, in the times of a pandemic, where there is a greater emphasis on wearing clean and laundered clothes. As long as people require clean clothes, the demand for the dry cleaning and laundry business will remain. This is because everyone does not own dryers and washers at home and even if they do the same level of cleaning and appearance of professionally laundered clothes cannot be attained at home. Also, doing one’s own laundry is found to be the least favoured chore by several, thereby increasing the popularity of the laundry business.
Advantages Of Starting A Laundry Business
Presently the laundry business is approximated to be a $40 billion dollar industry globally. And further this dry-cleaning and laundry services market is poised to grow by $ 1.28 bn from 2020 to 2024 progressing at a CAGR of 1% in that time frame. These figures indicate that starting a laundry business is a lucrative business plan for aspiring entrepreneurs.
Apart from the growing demand and the expected growth of the laundry industry, the other reasons why entrepreneurs must consider starting a laundry business include-
- Easy to operate- a laundry business is easy to operate and can be started without requiring any special skills or qualifications.
- Scalable- the laundry business is scalable and can be expanded into branches or even franchises.
- Low labour costs- the cost of labour for a laundry business is low and manageable, especially by new business owners.
- Steady income- a laundry business is recession proof and ensures a steady income throughout the year, irrespective of the season or market upheavals.
These are some of the advantages of starting a laundry business, thus making it a favourable choice for aspiring entrepreneurs.
Essentials Of A Laundry Business Plan
In order to start a laundry business successfully, it is recommended that entrepreneurs carry out thorough research to understand what are the essential details they need to focus on to start the laundry business.
- Create A Business Plan
Creating a business plan is a highly recommended first step while starting any business. The laundry business plan will help entrepreneurs visualise the business in detail and note down all the important factors and criteria essential for the laundry business which might otherwise skip the mind. A business plan further helps validate the feasibility of the idea. Aspiring entrepreneurs can avail the Business Planning and idea validation service to help them ascertain that they have a rewarding business idea and can use the service to get help with the creation of the business plan too.
The laundry business plan must include an executive summary and information regarding the exact type of the business along with its structure, number of employees needed, their roles, and other operational details. The business plan must also include a market research study conducted by the entrepreneur highlighting the area where the laundry will be situated, what is the competition in the area, is there a demand for the laundry, etc.
The business plan must also include a financial summary mentioning in detail where the capital for starting the laundry business will come from, what will the capital be needed for and an estimated projection as to when will the business start making a profit.
- Select An Appropriate Location
Selecting a prime location to start the laundry business is vital to the success of the business and an essential detail that must be considered by aspiring entrepreneurs. The location must be appropriate, such that it can be easily accessed by potential customers and be located in an area where there aren’t any (or are few) laundries but there are several residents (potential customers) residing in the area. A shop with parking space will further add to the convenience of the customers and make them prefer this laundry as against others with no parking.
The location must also be spacious enough to accommodate the equipment needed for the laundry business as well as to store the dry cleaned garments. Additionally, if renting out a place, the rent must be affordable and in case of purchasing a shop space, the price of the shop must not eat into the entire capital required for starting and running the laundry business.
- Acquire Essential Equipment
The pieces of equipment are essential components of the laundry business and absolutely necessary in order to start the business. The list of commonly required equipment for a laundry business include-
- Washers or washing machines
- Detergent vending machines or detergent storage devices
- Dry cleaning solutions
- Steam vending machines
- Iron and ironing board
Additionally, a cart is required to take all the clothes from the counter of the shop to the cleaning area. Also, if the laundry provides home delivery or pick up and drop service then a van or transportation vehicle is needed to pick and drop the clothes.
While purchasing washers, entrepreneurs need to even compare the efficacy of a front loader machine with a top loader along with the price difference between the two types of washers.
These equipment require a sizeable investment and must be considered and included in the laundry business plan too.
- Procure Legal Registrations
The laundry business needs to be compliant with existing laws and regulations and must therefore obtain the necessary registration and licences before setting up the shop. The registrations required for the laundry business include-
- Shop Act- the laundry operates from a shop or premises located within the municipal corporation limits of the city and must therefore obtain Shop Act registration which regulates the working conditions of the employees.
- GST registration- the laundry business will have to pay taxes and to do that will need GST registration to make it compliant with the existing uniform taxation structure of the country.
- Business entity registration- the laundry business needs to be incorporated either as a sole proprietorship, partnership firm, company, etc and thus registered as per the selected business entity.
These are the registrations necessary for a laundry business.
- Ensure An Accounting System
Often while enlisting the essentials for a laundry business plan, some of the basic details are overlooked, but which are necessary for the smooth functioning of the business. For a laundry this entails an accounting system. The laundry business involves handling of cash as customers make payments and collect the laundered clothes. In order to keep track of all the accounts, and maintain a record, entrepreneurs can download accounting services checklist to ensure that the financial transactions are recorded, reported and analysed, thereby helping reveal the business performance in terms of profit or loss for a given period, the value and nature of business’s assets, liabilities and owners’ equity. Therefore activating an accounting system is a must for the laundry business.
- Secure Necessary Capital
Capital investment is required to start the laundry business- to purchase or rent the shop space, to purchase all the equipment, to obtain all the necessary registrations, to pay the salaries to the employees, to pay for resources such as electricity and water, for the fuel expenses and several other miscellaneous expenses.
This capital can be obtained via bank loans or loans via NBFCs (non banking financial companies) or even through personal savings or borrowings. Entrepreneurs need to prepare a proposal if applying for a loan and keep all the necessary documents ready. Securing the necessary capital for the laundry business is an essential detail to consider before starting the laundry.
- Draw A Marketing Plan
The marketing plan for the laundry business is important to help distinguish the business from the competitors and to lure the targeted customers. Marketing is crucial for the business and can be achieved by advertising in local newspapers, nearby apartments and residential societies as well through flyers offering coupons and discount codes to customers.
As a growing number of people search for laundry services online, entrepreneurs must ensure that their business has an online presence via a website, listing all the basic information about the business such as it’s location, working hours, contact information etc. Also the laundry business must be easily found online via search engine optimisation. Additionally, entrepreneurs can create a strong reputation for the business by responding to all the reviews and enquiries online, thereby boosting the business and increasing its visibility.
These all pointers are the essentials that entrepreneurs need to consider while making a laundry business plan. These details will help them make a smooth start of the laundry business and for any other business related queries or support they can always contact deAsra Foundation for assistance.