Retirement and assessing the value of your laundry business

One day the time will come for every laundromat or dry cleaner owner to say goodbye to business. The entrepreneur may have been in the laundry business for more than 30 years, and will at some point be ready to retire. If all goes well, the business will be sold at a good price. The question is how to establish a selling price. When owning the building and the business, how to value each?

The first step will be to get a bank appraisal on the property. This will help to determine the value of that property. Besides, with this appraisal, it will be much easier for a potential buyer to receive a loan. To determine the value of the laundry business, a factor of two to five times the net income is generally used. That seems to be a wide margin, but laundromats vary greatly. As a general rule, if a store is in excellent condition – with newer equipment, great parking availability, etc. – it will be worth more money because the buyer will not have to invest a lot of money into the business for several years.

The overall best thing to do will be to hire a broker or intermediary with expert knowledge in this field. It may cost, but in the end a good broker will get more money at the sale with no doubt much less worry.