In this episode: Ian and Brian reveal how they turned a $100 initial deposit into a $10M laundromat portfolio including Wash-Dry-Fold POS and Liberty Laundry.

They discuss the "Cowboy Customer" that led Brian to computerize his laundromat, why an employee’s $350 mistake helped build a national tech company, and why having "too much capital" is one of the biggest pitfalls in creating a profitable business. 

Takeaways

• Starting a business with minimal capital
• The importance of niche focus 
• Creating value creates space for profits
• Finding financial freedom
• Scaling a business with employees

• 0:00 - The $100 Startup: Potential vs. Self-Actualization
• 4:52 - Hobby vs. Business
• 7:29 - The Liberty Laundry Origins: 2005 to 2010
• 11:08 - How the Cowboy Customer inspired Wash-Dry-Fold POS
• 13:05 - How Sue’s $350 Typo Inspired Credit Card Integration
• 16:02 - The 2015 Clean Show: High-Tech Laundromat Demand
• 19:11 - Limitations of Dry Cleaning Software for Laundromats
• 21:22 - Customer #1: Selling the First POS System
• 27:37 - From $20k Goals to $5M in Profit
• 33:13 - The Dave Ramsey Influence & Cutting the Credit Cards
• 39:42 - Building a Team that Runs Without You

Companies mentioned in this episode:
https://www.washdryfoldpos.com/
https://www.libertylaundryok.com/

The conversation delves into the valuation metrics for laundromats, covering topics such as Seller Discretionary Earnings (SDE), EBITDA, Free Cash Flow (FCF), and Net Income. It provides a comprehensive understanding of how these metrics are used in the valuation and assessment of laundromat businesses.

Takeaways

• Understanding laundromat valuation metrics
• Understanding seller discretionary earnings
• What metrics are best for laundromat valuations and why?
• Should I include assets in the valuation metrics when buying or selling a laundromat? 

  
  Link to graphic
  https://www.washdryfoldpos.com/laundromat-valuation-metrics/
  

00:00 Introduction to Laundromat Ownership

01:02 Public companies typically trade at a multiple of their earnings

02:50 Start with valuing the assets separately

04:49 Intangible Assets

05:56 Concentric Circle Chart of Earnings

07:48 Seller discretionary earnings

10:21 What is SDE and what does it include?

13:54 EBITDA vs. SDE: What to Use?

15:57 Free Cash Flow: A Banking Perspective

18:37 Net Income: The Final Metric

23:33 Conclusion: Mastering Valuation Metrics

24:59 Outro

In this episode, Ian Gollahon discusses the addition of wash-dry-fold services to a laundromat.

This episode emphasizes:

• The financial rationale of wash-dry-fold services.
• The necessary space and supplies for wash-dry-fold.
• The importance of having a well-trained staff for wash-dry-fold services.

Other takeaways:

• Space for operations is a critical factor in success.
• Wash-dry-fold services can significantly boost profitability.
• A well-trained attendant is crucial for customer satisfaction.
• Investing in larger machines can lead to better revenue.
• A structured process is essential for efficient operations.
• Customer service scripts can enhance the customer experience.
• Regular training for employees is necessary for consistency.
• B2B services can be a major revenue source in rural areas.
• Creating a clean and safe environment is vital for customer retention.

Chapters

00:00 Introduction to Laundromat Ownership

00:48 The Benefits of Wash Dry Fold Services

01:28 Rate of Return on Wash-Dry-Fold Services

02:35 Starting a Wash Dry Fold Service

02:57 Drop Off at Counter

04:29 Sorting

05:21 Wash

06:06 Dry

06:17 Fold

07:04 Done (Ready for Pickup)

08:08 Customer Pickup

08:36 What you can't do without

09:24 Wash-Dry-Fold considerations when building a launndromat

09:52 Distributors will try to sell you too many machines!

10:41 When can you not add wash-dry-fold to your laundromat?

11:51 Hire vs. DIY

12:27 Labor and Process in Wash Dry Fold Operations

13:11 Outro

Links referenced in this episode:

Wash-Dry-Fold POS blog post: https://www.washdryfoldpos.com/how-to-add-wash-dry-fold-service-to-your-coin-laundromat/

Liberty Laundry Website:
https://www.libertylaundryok.com/