Is your Credit Score >750?
- Get low interest loans & Lifetime FREE credit cards
- Get customized Credit Health Report
- Improve your creditworthiness
Introduction
Laundry business has changed a lot in our country from the traditional manner of the business. Earlier, the majority of people used to send their clothes to the laundry mainly for ironing them and not the entire process of washing, cleaning and drying. However, due to the lack of time and energy to perform basic household chores, people prefer to delegate them to professionals at a decent price that does not hurt their pocket too much. The urban population would rather spend some money on delegating or getting menial jobs like laundry done professionally than do it themselves. This has been the recent trend and it has created an increased market for laundry business.
Laundry businesses are especially handy or important for many industries like the hotels, restaurants, resorts, hospitals, and other such mega units that have huge loads of laundry that is impossible to be done on a small scale or using personal washing machines.
About Laundry Business Plan
Basics of Laundry Business Plan
Like any other business, the laundry business also requires a detailed business plan right from detailing the objectives to the road map to achieve them. This plan will include the details of the operational plans, staff requirements, scale of operations, financial plan that will determine the viability of the business, completion analysis, industry analysis, customer analysis and more. A well executed business plan will help the entrepreneurs acquire investments as well as loans for sustenance, growth and expansion.
Some of the highlights of a laundry business plan are discussed below.
Industry Analysis
Any business should have a general idea of the industry it is in. The entrepreneur has to understand the market and the place it can carve for his/her business in the existing industry. Entering into the laundry business does not require any educational qualification or professional background, however, it is better to gain a perspective of the business and the general operations by having a job experience with some other laundry business (preferably popular). The entrepreneur can undertake a thorough research of the market and the possibilities before starting his/her own business. This research will also provide good input in choosing the location of the business. The premises of the business will play an important role in the success of the business. The location has to be easily accessible and visible as well as customer friendly i.e., easily accessible even for elderly and physically challenged persons.
Financial Plan
Financial plan will highlight the cost benefit analysis of starting the business as well as the future revenue projections that will help the entrepreneur break even and eventually turn it into a profit making business. The financial analysis will require an in depth analysis of the financial statements i.e., the income statement, cash flow statement and balance sheet. Another aspect of financial planning is estimating the capital investment requirement, equipment and other assets needed like washers, cleaners, dryers, detergents, fabric softeners, irons, hangers, etc. The quantity needed for these equipment and products will depend on the scale of operations of the business as well as the size of the premises of the business.
Operation plan
The operation plan is basically outlining the scale of operations and the requirements of staff. If the business is being opened on a small scale then the support staff requirement will be considerably less as is the case with any small business venture. It is only after the business gains some momentum that the entrepreneur can think about increasing the level of operations and hiring more staff.
Customer analysis
The customer analysis is very crucial in the laundry business. The demographic structure of the location of the business is very important in determining its clientele. The usual customers of any laundry business are mostly the younger population or elderly population that have to depend on others to take care of their laundry. If the business is opened in an area where the demand for a laundry business is very low, the entrepreneur will not gain much in such a place of business. Also, most customers prefer a laundry business that provides additional services like pick and drop of clothes, dry cleaning services, etc.
Competition analysis
Analyzing its competition is of utmost importance for any business especially for a new venture. The entrepreneur has to ensure that the services provided by his/her business are better and more efficient than the existing competition. This will ensure an easy creation of demand for the entrepreneur’s business. Also, the pricing policy of the business will greatly depend on its competition analysis among other factors. If the pricing of the new venture is quite high as compared to an existing business, the customers are sure to give it a miss. Hence, the entrepreneur has to undertake competition analysis from more than one aspect of the business.
Marketing and promotion
A laundry business does not usually have the funds to spend huge on publicity and advertising. The business usually relies on word of mouth publicity and the quality of services provided. There can be various other options that the entrepreneur can avail like promotional offers, loyalty cards, discount offers like family discount or bulk discount, anytime pickup and drop facility of the laundry, etc.
These are some of the pointers that can be included in a successful business plan for a laundry business. Laundry businesses are often considered to be micro or small businesses. But when the business has adequate resources, enough customer base and a good brand name, it can also be turned into a bigger business or even a franchise.
FAQs – Laundry Business Plan
1. Is there a demand for laundry business?
Yes. The demand for laundry business is on the rise especially in the urban areas.
2. Can a laundry business be started with minimal funds?
Yes. A laundry business does not require heavy initial investment to set up and start operations. Thus a laundry business can be started with minimal funds and smaller premises as well.
3. Does the laundry business require registration and licensing?
The laundry business does not require registration as such; however, registration under the Shops and establishment Act or MSMED Act will help the business get help via government schemes or easier and affordable loans from banks, NBFCs and MFIs.
4. What is the most profitable operation under a laundry business?
Dry cleaning is the most profitable operation under the laundry business. The profit margin for these operations can go as high as 150% of the cost.
5. Is location an important aspect for success or failure of laundry business?
Yes. Location of the laundry is very important to determine the success or failure of the business. If the location is not easily accessible or if the drop off or pick up of clothes at the laundry is a cumbersome process, the customers would not be keen to visit the place which will eventually result in the downfall of the business.