Planet Laundry Nov 2020

LAUNDRY 101

chances are it can refer you to someone who does. Another way to find brokers is to search local ads and see who are selling laundromats. “With brokerage, I believe word of mouth often can be best,” Frankian said. “Talk to other store owners or former owners in your area who have already undergone buying or selling a store through a broker.” Of course, be sure to meet with a few brokers before making your final decision. “The most important question to ask is what experience the broker has in representing laundromats,”Dang explained. “There are excellent brokers out there who sell millions of homes and various businesses, but unfortunately, they’re not familiar with the unique qualities of the laundromat business. You should be asking themwhat they are going to do for you, either as a seller or a potential investor. What are the fees?Who pays the fees? How long have they been in the laundry business, and do they currently own or operate any stores?” Working with a Broker When working with a broker, sellers need to be able to provide a

breakdown of their income as it pertains to their various washers and dryers, a copy of their lease, and access to all utility and other monthly bills. “The owner can help the broker by having all of their financial and equipment information available,”Morgan said. “We send out a checklist to all sellers, giving them a clear idea of what we need to see to give them an accurate picture of what their laundry should be listed at and what it will probably sell for.” “If you’re looking to sell the store, now is the time to make it shine,”Dang added. “All lights should be on and working. The store should be clean. And, if needed, a fresh coat of paint should be added. All equipment should be in working order. How does the store look from the outside? Are the windows clean and clear of any clutter? Is the sidewalk clean?” Also, if the lease has little time remaining, it would be helpful if the seller reached out to the landlord to make sure that obtaining a longer termwill be available and learned what the terms would be for a new buyer. As a potential investor, be honest with the broker about your goals. Is this going to be a hands-on business, or do you plan on continuing to work at your current job?What is your most recent credit score, and what does your financial statement look like? “You should have your financial information handy for the landlord or lender when asked,”Dang said. “Also, make yourself available during the due diligence period. Remember, the seller has his or her own obligations as well, so you both need to be flexible.” Don’t Bypass the Broker Even experienced laundry owners should utilize the services of a broker when buying an additional store or selling their business, according to Dang. “It’s always good to have an extra pair of eyes to look over the transaction and paperwork, as well as having someone as a go- between with the buyer or seller,” she said. What’s more, experienced laundromat brokers can bring in a wealth of knowledge to the table. “Brokers are important even for veteran operators,”Frankian explained. “For one thing, store owners are busy running a business, and their time is valuable. On your own, you are going to have to screen every potential buyer yourself, and could end up wasting a lot of your time dealingwith tire-kickers or simply buyers who are not financially strong enough to make a deal happen.” “Brokers are experienced at looking not only at the obvious, but also the hidden factors that even savvy owners could miss,” Morgan pointed out. “It’s just good insurance to have an experienced broker working for you. In my more than 32 years in the industry, I’ve rarely seen a buyer – excluding some veteran operators – receive a good deal after bypassing a broker and purchasing directly from the seller.”

PLANETLAUNDRY PODCAST

Listentoyourfavoritelaundry-industrymagazine on the go, .-,+*)(,'*&%$,*(,#","'%,*!,, % , '%,-% , #-%" #)- (+, * # ", (.- , *&%,* ,"'%, "*(.% ,#- , * )&- ,"*, . % , %#(, (*&, % * , "*(%,* -%( $, ) .-% ,% %(" $,#- , *&%,* ,*)(, * ) #(, * )&-. " ,.- ) .- , % , '%, #)- (+, * "*( , #( -%(,#- , "% '%-, %#- , *), #-, "(%#&,"'% %,'. ' )# ."+,#) .*, , % , (*&,"'%, -"%(-%"$, *(, +*), #-, * - *# , "'%&, #- , # , "*, +*)(, % . % , * # ", #+ . "

BETTER YOUR LAUNDRY BUSINESS. LISTEN & SUBSCRIBE TODAY.

LISTEN NOW AT PLANETLAUNDRY.COM/PODCASTS

16

PlanetLaundry Magazine

planetlaundry.com

Magazine of the Coin Laundry Association