So You Want to Start a Laundry Business? Here’s How to Find the Funding You Need!
Are you starting your own laundromat business? Finding the funding to start your laundromat might seem like an impossible task, especially when so many people in the world have trouble coming up with small amounts of money for everyday things. Luckily, there are plenty of different ways to find the money for your laundry business, if you know where to look! In this article, we’ll go over some of the most popular ways to get the funding you need and discuss some reasons why they might or might not be right for you.
When you start your business, you want to be able to predict how much cash it will take for you to launch your new venture. The easiest way is by creating a pro forma income statement. In essence, it’s an actual income statement that looks at what your business’s revenues and expenses will look like in year one of operations. This allows you to understand how much money you need upfront before opening up a shop.
Write up your business plan. Before you can begin approaching potential lenders, you’ll want to write up your business plan and make it as comprehensive as possible. Even if you do decide against using your plan for seeking out loans, later on, having one will help you keep track of your business’s growth in more formal terms than just jotting things down on sticky notes all over your office walls.
Get an idea of what kind of loan you need. If you’re planning on purchasing an already-existing laundromat, it could be an SBA loan or private loan, depending on if there is equity involved. If you are opening up a new business from scratch, you may want a construction loan, which will cover the costs of building or renovating property or buying equipment. Construction loans can take longer to get approved than other types of loans and require more documentation, but they also have lower interest rates than other types of loans. In addition, some banks offer bridge loans that allow you to secure funds while waiting for your permanent financing to come through. It is important to find a bank that works with businesses like yours?lenders tend not to specialize in specific industries as small businesses do.
Know your credit score. Bad credit can be a significant problem if you want to get funding for your business idea. If you’re planning on using loans or other financing options, it is critical that you know your credit score in advance. Get familiar with what goes into your score and do whatever it takes to keep it as high as possible?it can make all of the difference in how much money you end up raising for your business. It may even mean choosing between different types of funding, like equity versus debt. If you don’t know where to start, talk to a lender about your options or visit a free service for more information.
Ask family, friends, and colleagues for help. Not every laundromat owner takes out a loan, but those who do often find it easier?and cheaper?to get funding from family and friends than from traditional banks. If you’re looking for cash, getting recommendations is key: Talk to your laundromat operator contacts; ask them where they got their money and how much interest they had to pay.