Are Laundromats Profitable?
Laundromats are profitable at the operating line: the Coin Laundry Association's 2024 survey reported a 27% median operating net profit for 2023. But that figure sits before income tax, before debt service, before owner compensation, and before any equipment replacement reserve. What an owner keeps after all four is a much smaller number.
Key takeaways
- 27% median operating net profit before tax, debt service, and owner compensation, with a 26% mean (Source: CLA 2024 Laundry Industry Survey).
- Utilities 20%, rent 18%, payroll 20% of gross revenue at the median — and utilities were the most-cited operator problem at 53%.
- The 27% figure is not a return. Subtract owner labor, debt service, tax, and a replacement reserve to get one.
- Demand is non-discretionary, which supports volume, but it does not protect a thin-margin store from utility and wage increases.
- Fixed costs dominate, so laundromat profit is highly sensitive to revenue changes in both directions.
The Short Answer
Yes at the operating line, at a 27% median margin. Whether it is profitable to you depends on what you paid, how you financed it, and how many hours you work in it.
The Cost Structure
| Line | Median share of gross revenue | Mean |
|---|---|---|
| Rent | 18% | 24% |
| Utilities | 20% | 21% |
| Payroll (stores with payroll only) | 20% | 22% |
| Operating net profit before tax, debt, owner comp | 27% | 26% |
Source: CLA 2024 Laundry Industry Survey, 377 owner respondents, 2023 operations. The association notes extreme responses pulled the mean rent figure upward, and the payroll calculation excludes stores with no payroll.
Those three lines account for most of the cost base, and two of them — rent and much of the utility base — are fixed regardless of how many machines run. That is what makes laundromat profit unusually sensitive to revenue in both directions: incremental revenue drops through at a high rate, and so does incremental revenue loss.
From 27% to What You Keep
Take a store at the surveyed median revenue of $335,000.
| Line | Amount |
|---|---|
| Gross revenue | $335,000 |
| Operating net profit at 27% | $90,450 |
| Less: market-rate value of the owner's own labor | ($48,000) |
| Less: debt service on an acquisition loan | ($38,000) |
| Less: replacement reserve | ($12,000) |
| Pre-tax remainder | ($7,550) |
Illustrative, and deliberately uncomfortable. Change any assumption — a smaller loan, fewer owner hours, a store above the median, a lower occupancy cost — and the answer turns positive. But the exercise shows why "27% profit margin" cannot be quoted as a return, and why a buyer who does gets a surprise in year two.
What Separates a Profitable Store From a Marginal One
Occupancy cost. A store at 18% of revenue in rent and one at 28% are different businesses, and the difference is permanent unless the lease changes.
Utility efficiency. Utilities were the most-cited operator problem in the survey at 53%. A leak, an inefficient water heater, or a top-loader-heavy machine mix can put a store five points above the median, which on $335,000 is roughly $17,000 a year. ENERGY STAR reports that certified commercial washers are on average 9% more energy efficient and use about 45% less water than standard models — a real effect, applicable only to qualifying models, not to every retool.
Turns and pricing. Machine utilization and vend price relative to the local market. A store priced well below its competitors may have headroom, or may be defending its volume — find out which before assuming.
Labor model. Attended stores carry payroll at a median 20% of revenue and can sell wash-dry-fold; unattended stores carry none and cannot. Both work; they are different businesses with different margins.
Service mix carrying its true cost. Wash-dry-fold revenue looks high-margin until labor minutes per pound are measured honestly.
Profitability at Sale
Profit and value are related but not the same. The market paid a median 3.50x owner earnings across 855 reported sales for 2021-2025, on median earnings of $76,560 and a $250,000 median price. A store's profitability is the input; its evidence quality, lease term, and equipment condition decide the multiple applied to it.
What to Do Next
If you own one, compare your rent, utility, and payroll shares against the surveyed medians and find the explanation for any gap. If you are buying, ignore the 27% figure entirely and build the store's own bridge from revenue to what you would keep, with your labor and your debt in it.
The Next Step
Frequently Asked Questions
What is a laundromat's profit margin?
The CLA's 2024 survey reported a 27% median and 26% mean operating net profit before tax, debt service, and owner compensation, for 2023 operations across 377 owner respondents. That is an operating margin, not a return to an owner, and the difference is large enough to change a purchase decision.
What are the biggest costs?
Utilities at a median 20% of gross revenue, rent at a median 18%, and payroll at a median 20% among stores that have payroll. Utilities were also the most-cited operator problem, selected by 53% of respondents, ahead of labor availability at 42% and labor cost at 37% (Source: CLA 2024 Laundry Industry Survey).
Do laundromats stay profitable in a downturn?
Demand for clean clothes is non-discretionary, which supports volume better than many retail categories. That is not immunity: customers shift to larger machines and fewer trips, wash-dry-fold volume can soften, and utility and wage increases do not pause. Stores with thin margins and no pricing headroom feel it fastest.
What makes one laundromat more profitable than another?
Occupancy cost, utility efficiency, machine mix and turns, vend pricing relative to the local market, labor model, and whether service revenue carries its real labor cost. Two stores with identical revenue routinely differ by tens of thousands in operating profit for those reasons.
Sources
- Coin Laundry Association, 2024 Laundry Industry Survey (377 owner respondents, 2023 operations) — https://member.laundryassociation.org/hubfs/IndustrySurvey24.pdf
- Coin Laundry Association, Industry Overview — https://laundryassociation.org/for-investors/industry-overview/
- BizBuySell, Laundromat and Coin Laundry Valuation Benchmarks, 2021-2025 closed sales — https://www.bizbuysell.com/learning-center/valuation-benchmarks/laundromats-coin-laundry/
- ENERGY STAR, Commercial Clothes Washers — https://www.energystar.gov/products/commercial_clothes_washers
This page is general information about laundromat transactions, not legal, tax, or investment advice, and not a guarantee of sale price, timing, or financing approval. Verify current rules with your own CPA, attorney, lender, and the relevant state or municipal agency before acting.