[spex x]

From personal experience, here is what I can tell you about the coin-op laundry business. First, your biggest expense by far is utilities. Gas and electric can eat up about 35% of gross or more depending on your equipment. The second biggest expense is maintanence, although on new machines, it will be negigible. For the sake of argument, let's call it 10% of gross per year.

You should buy more expensive machines. In the long run, they'll last longer, run more efficiently, and break less. Good Sqeed Queen machines cost about $1000 each plus installation. Sure, you could get the Whirlpool machines for $750 each. But they're crappy. Its not worth it in terms of time a headaches. Good Sqeed Queen machines can easily last 15 or 20 years. If you need 12 machines, I'd plan on spending about $14,000 total.

You vastly overestimated how much laundry people do. You're not going to get 2 loads per person per week. More like two loads per household per week. And I'd guess that only 70% of the households will use your service.

On the bright side, you can easily raise your price to $1.50 for washing, maybe even $1.75. Make them pay for the convenience. I doubt you'll lose many customers if you raise your price. Also, you overestimated the number of peoople that'll wash but not dry. I'd say about 93% will both wash and dry.

On the other hand, you didn't consider insurance expenses or utilities. So that is a bummer.

Alright, so lets do some financial analysis. We'll assume that the terms on your financing are $2000 down, $12000 note for 5 years at 10%. if you raise your price, your average sale is 2.98 and you'll get 2 loads per household per week, and you've got 56 households. We'll also assume that your rent will be, say, 20% of gross. I definitely wouldn't pay any more than this. This is a monthly analysis.

Gross profit = $1335
Rent = ($267)
Utilities ($467)
Maintenance = (133)
Insurance = ($70) guessing, prob less
NET PROFIT = $398 per month

Now, considering that you live in the complex, i'd guess that you'll spend maybe 2 hours per week dealing with the business. When you move out, add 2 more hours per week. So you'll be making maybe $50 per hour while you live there and $25 per hour after that. But in 5 years you'll own the machines outright, so you'll have fewer expenses at that time. Also, your net will be a bit higher b/c of tax advantages. For instance, you can write off depreciation and you can write off your commute home (travel from a first to a second job is deductible), plus all your normal expenses too.

Overall, I think that it looks like a decent way to own your first business with very little risk. There is a decent upside for someone who wants to devote the time.

Looks like a good deal, even if not as good a deal as you originally thought.