BUSINESS PLAN

<Insert logo>

Business Address
<insert address>

Company
<insert trading information>

Trading as
<Insert location> Laundromat

Owner/Director
<insert name>

Executive Summary
<Insert location> Laundromat is a start-up, coin operated laundry service dedicated
to providing high customer satisfaction by offering a variety of reliable machines, a
clean premises and competitive pricing.

The mission is to provide a convenient, safe and clean laundry. Demand for a
laundry in this location has largely been overlooked and now stands as an
overwhelming opportunity to service the area and surrounding suburbs.
This particular location has been selected by following a precise algorithm to
determine its feasibility:
• Appropriate demographics
• Low rental costs
• Machinery reliability and reputation
• Proximity to competitors
• Across the road from Welfare services
• Visibility form main road
• Walking distance to major shopping complex
• Industry expert advice and mentorship

In order to set up the <Insert location> Laundromat, the venture requires $165,000 in
loan financing. The loan will be paid back from the cash flow generated by the
Laundromat and shall be collateralized by the assets of the business – which will be
backed by the character, knowledge and personal guarantees of the owner.

Yearly Profit Potential

It is important to note that the minimum monthly repayments should decrease as
principal decreases. The profit in the table below is after all monthly expenses and
loan repayments have been subtracted. All net profit will then be contributed toward
the loan to reduce the lifespan of the loan.

To keep profit potential high, the <Insert location> Laundromat business model
requires no employees in order to do business.
The below graph is the projected 3 year profit potential based on how many times a
machine is used per day; 2.5, 4 and 6 respectively:

$300,000.00

$250,000.00

$200,000.00
Sales
$150,000.00 Gross Margin
Profit
$100,000.00

$50,000.00

$0.00

Key to Success
The keys to success in the laundry business are:

Location

The shop space is situated amongst a cluster of small retail outlets including a Bank,
Dry Cleaners, Pet grooming, a Tobacconist, Community Housing Office and Finance
(small loans).

This location has very high visibility from the most major road that runs through
<Insert location> and is directly opposite a Welfare services (perfect demographic)
and <Insert location> Shopping Centre, which is biggest shopping complex in a
25km radius. <this shopping centre> is currently undergoing a $50 million renovation
to promote business in the area.

Additionally, this Laundromat will be the only one that services <insert number of
suburbs and their names>
Convenience

This location offers ample parking, long opening hours from 5am – 11pm, seven
days a week, 365 days per year, and a full service washing machine and drying
service, plus a coin changing machine on site. All the while being closely situated to
the biggest shopping complex and other shop outlets.

Cleanliness
Providing a sparkling clean presentation is an environment everyone wants when
doing his or her washing. Giving a sense of cleanliness by using lots of white colours
and ensuring the premises is cleaned daily and thoroughly is crucial to keeping
return customers.

Reputation

<Insert location> Laundromat will provide a well-lit Laundromat, including the car
park with surveillance, allowing clients to feel safe during open hours. Along with
safety, the reliability of the Dexter machines and the quality of wash they provide is
essential for harbouring a good reputation amongst the community.

Company Summary
<Insert location> Laundromat will supply a full washing and drying self-service with
plenty of table space for folding. We will also provide quality detergents to ensure
clean washing of clothes as well as other household products.

The unique selling proposition of <Insert location> Laundromat will be its clean
premises, convenient location and long opening hours.

Owner Summary & Start-up Motive

The owner of <Insert location> Laundromat is <Insert name>, an experienced
Marketing Manager with an entrepreneurial outlook. His focus on data driven
decision-making will ensure that this business shall become a success.

The concept for a Laundromat came to fruition following discussions with investment
experts and mentors after evaluating low involvement, low risk, steady and reliable
income generating opportunities.

Start-up Costs
The biggest cost associated with the start up of the <Insert location> Laundromat is
the equipment – totalling $134,429.30 inclusive of GST. In addition to this amount,
the venture will require $30,000 for shop fit out costs and other associated costs.

Proposed Loan Structure

Loan Amount Structure How it will be spent

$134,429.30 Rent-to-buy Accquire equipment
Secured or Unsecured Business Pay Trades; Electrician,
$30,000 Loan or Home Mortgage flooring, plumber, carpenter,
Refinance signage.

Total Funding - $164,429.30

Company Location and Demographics

<Insert location> Laundromat is located in <Insert location>. It will utilize 60 square

metres of floor space for all seating, equipment, folding benches, storage and foot
traffic area.

It sits amongst a number of other shops, suitable to the demographic for this
Laundromat.

Demographic

The perfect demographic for a Laundromat (as advised by industry experts and
industry analysis) is a low income, high rental area with a high saturation of families,
close to areas of interest (Welfare services, <insert shopping centre>).

<Insert location> has an average weekly household income of $746 and 37% of
homes are rented. In addition, the largest industry people in this area work in are the
Health Industries – meaning shift work, which is ideal for late night or early morning
washing.

Services

<Insert location> Laundromat is a self-serve coin operated laundry. There will be a

total of 8 washing machines (of multiple capacities), 4 dryers, dual soap dispensers
and a coin change machine.

Future revenue generating opportunities may include:

• Vending Machine
• Wi-fi
• Ironing
• Folding
• Pick up and drop off

Competitive Comparison
The closest competitors are listed in order of distance from <Insert location>
Laundromat:

Laundry Distance
<insert competitor> 3.3km
<insert competitor> 3.6km
<insert competitor> 4km
<insert competitor> 5.4km
 <insert competitor> 5.5km
<insert competitor> 9.7km

The closest Laundromat to <Insert location> Laundromat is open 3 hours less per
day, has no on site parking and is not well lit. It’s in a more remote part of town,
making the experience less convenient with no shops in walking distance.

In addition, anyone who travels to this Laundromat from <these suburbs> and
surrounding areas, will have to drive past the <Insert location> Laundromat – adding
3.3km to their journey (for a poorer washing experience).

This is a great opportunity to provide a service that is in high demand in the right
location.

Marketing Strategy
There is no questioning the power of word-of-mouth in the laundry industry. In a bid
to create word of mouth, the core strategy will be to amplify the social media footprint
by using a ‘check-in’ or hash tag campaign.

The Campaign

Every time a person ‘checks-in’ or uses a designated ‘hash-tag’ – they go into a

monthly draw to win a $50 grocery voucher. This promotion will be displayed on the
wall inside the store, in effect, influencing people to share with their family and
friends where they are - encouraging online word of mouth for <Insert location>
Laundromat.

In addition, the following marketing activities are to be implemented:

- Facebook page to publish washing related content, community news and
monthly ‘grocery winner’ announcements
- Facebook outgoing engagement – engaging with other local businesses
and community current affairs as “<Insert location> Laundromat” to
increase online exposure to local market.
- Facebook advertisements – targeting people in target market.
- Set up on Google Maps for easy locate
- Yellow Pages
- Website, optimized for search engines (including Google maps)
- Google ads, to get immediate traction until website starts performing
organically in Google
- School Newsletters
- Letter box drop to key suburbs
- PR in local paper to promote monthly grocery competition
- Signage – big writing, easily readable and highly noticeable from afar.

Target Market
<Insert location> Laundromat has a broad set of segmentation across the local area.
At a top-down level, the target market for <Insert location> Laundromat is people in
the local area who either
a) Do not own a washing machine/dryer
b) Do not have a washing machine with big enough capacity to cope with larger
loads i.e. large families, doonas etc.
c) Cannot afford to replace a broken washing machine/dryer

Industry Research and Trends

There are no companies with a dominant market share in the Laundromat industry,
which makes barriers to entry relatively low.

While growth in the industry isn’t rapidly expanding at just 0.3% over the past 5
years, fluctuations are almost non-existent. With the exception of sales spikes during
periods of high rainfall, the laundry industry is proven to perform either unaffected, or
better during a financial crisis.
 Cash Flow Proforma
The below cash flow projections provide 5 different scenarios based on the
frequency the machines are used per day. This Cash flow projection works from a
hypothetical $165,000 loan at a rate of 6%.

PROJECTED MONTHLY INCOME

VEND 2.5 3 4 5 6
MODEL QUANTITY PRICE TURNS/DAY TURNS/DAY TURNS/DAY TURNS/DAY TURNS/DAY
Dexter T300 / T350 20lb Washers 3 $6.00 $45.00 $54.00 $72.00 $90.00 $108.00
Dexter T400 / T450 30lb Washers 3 $9.00 $67.50 $81.00 $108.00 $135.00 $162.00
Dexter T600 40lb Washers 1 $14.00 $35.00 $42.00 $56.00 $70.00 $84.00
Dexter T900 / T950 60lb Washers 1 $18.00 $45.00 $54.00 $72.00 $90.00 $108.00

BASE MONTHLY WASHER INCOME $5,852.00 $7,022.40 $9,363.20 $11,704.00 $14,044.80

MONTHLY DRYER INCOME @50% $2,926.00 $3,511.20 $4,681.60 $5,852.00 $7,022.40

Plus Cycle Revenue $15.20 $18.24 $24.32 $30.40 $36.48

MONTHLY WASHER & DRYER SUB TOTAL $8,793.20 $10,551.84 $14,069.12 $17,586.40 $21,103.68

TOTAL MONTHLY INCOME $8,793.20 $10,551.84 $14,069.12 $17,586.40 $21,103.68

MONTHLY EXPENSES:
Rent $1,620.00 $1,620.00 $1,620.00 $1,620.00 $1,620.00
Utilities 22.0% $1,934.50 $2,321.40 $3,095.21 $3,869.01 $4,642.81
Marketing 2.0% $175.86 $211.04 $281.38 $351.73 $422.07
Telephone $30.00 $30.00 $30.00 $30.00 $30.00
Insurance $100.00 $100.00 $100.00 $100.00 $100.00
Professional Services ( Accounting) $100.00 $100.00 $100.00 $100.00 $100.00
Security $140.00 $140.00 $140.00 $140.00 $140.00
Repairs & Maintenance $43.97 $63.31 $112.55 $175.86 $253.24

TOTAL MONTHLY EXPENSES $4,144.33 $4,585.75 $5,479.14 $6,386.60 $7,308.13

MONTHLY CASH FLOW BEFORE LOAN REPAYMENT $4,648.87 $5,966.09 $8,589.98 $11,199.80 $13,795.55

MONTHLY LOAN REPAYMENT (from below) $2,410.41 $2,410.41 $2,410.41 $2,410.41 $2,410.41

MONTHLY INCOME
CASH FLOW AFTER LOAN TAKEN OUT $2,238.45 $3,555.68 $6,179.57 $8,789.39 $11,385.14

ANNUAL INCOME
CASH FLOW AFTER LOAN TAKEN OUT $26,861.45 $42,668.11 $74,154.80 $105,472.66 $136,621.69
 Return on Investment Analysis
Return on the investment in a worst-case scenario is 33.8% in one year.

TOTAL INVESTMENT $165,000

2.5 3 4 5 6
TURNS/DAY TURNS/DAY TURNS/DAY TURNS/DAY TURNS/DAY
ANNUAL CASH RETURN $55,786 $71,593 $103,080 $134,398 $165,547

RETURN ON INVESTMENT 33.8% 43.4% 62.5% 81.5% 100.3%

2.5 3 4 5 6
TURNS/DAY TURNS/DAY TURNS/DAY TURNS/DAY TURNS/DAY

MONTHLY NET INCOME (Before loan payment ) $4,648.87 $5,966.09 $8,589.98 $11,199.80 $13,795.55

MONTHLY NOTE PAYMENT @ 6.00% $2,410.41 $2,410.41 $2,410.41 $2,410.41 $2,410.41

MONTHLY CASH FLOW (after loan repayment) $2,238.45 $3,555.68 $6,179.57 $8,789.39 $11,385.14

ANNUAL CASH RETURN $26,861.45 $42,668.11 $74,154.80 $105,472.66 $136,621.69

YEARLY CASH RETURN (YEARS 1-7) $26,861 $42,668 $74,155 $105,473 $136,622

YEARLY CASH RETURN - (AFTER YEAR 7) $55,786 $71,593 $103,080 $134,398 $165,547

TOTAL CASH RETURN (YEARS 1-7) $188,030 $298,677 $519,084 $738,309 $956,352

TOTAL CASH RETURN - (YEARS 1-15) $634,321 $871,421 $1,343,722 $1,813,489 $2,280,725
Handling of Money
The owner, <Insert name> will collect money from the machines twice a week. It will
be counted by hand and deposited directly into the bank account. Collection time
may vary to maximize security of monies.

Financial Plan
Due to the demographic of the location, revenue is forecasted to not fluctuate
beyond concern, unlike Laundromat’s in high tourism areas. Weather patterns may
influence how often the machines are used, such as high winds, natural disasters,
heavy rainfall, extended periods of rain fall, power outages etc.

Payback Plan over 5 year period

As already stipulated, all remaining profit will be paid towards the loan as additional
payback.

Total amount of loan $165,000

Monthly loan repayment including $2410
interest
Additional payback amount from monthly $2238.45
net profit
Total Monthly Loan Repayments $4648.45

For monthly repayments of at least $4648.45, the 5 year loan term will be reduced to
approximately 2.5 years. The objective is to pay off the loan as soon as possible to
reduce cost of interest paid on the loan.

Based on the cash flow statement and the accelerated payment intention, this loan
could be paid off by FY2018/19.

Factors Minimising Risk of Loan Default

• Owner is keeping job as <insert role>

• Owner has x 2 mortgages with equity in both
• Proven business model
• Accountant handling money in and out
• Access to variety of Laundromat owners
• Agreed low rental % price increases
• 3 months rent free at start of lease
• Non–depreciation market value of business
• No Local competitor
 • Central location for shopping and in a low socio-economic area

Break-even point
Based on the each machine being used at approx. 1.8 times per day, over the
course of 1 year, <Insert location> Laundromat will need approx. 745 customers to
break even.