Are you wondering how much it cost to start a dry cleaning business? If YES, here is an estimated cost of opening a drycleaning business.
The dry cleaners industry provides dry cleaning and laundering services and they cater to household consumers and commercial clients such as hotels and restaurants. Operators may also provide drop-off and pick-up sites for customers.
In addition, establishments may also offer specialty cleaning services for garments and textiles such as fur, leather, suede, wedding gowns, draperies, and pillows. Please note that the dry cleaners industry does not include coin-operated laundromats, nor does it include companies that generate most of their revenue from linen and uniform rentals.
The market for dry cleaning services is driven by urbanization and the increase in consumer spending – in essence as the general economy of a country grows, more people will become busier hence the need to patronize dry cleaning services on a regular basis.
So, if you are interested in starting your own dry cleaning business in the United States, it will be a wise decision to first take out time to conduct detailed cost analysis on the business.
The truth is that some businesses fail simply because proper feasibility studies, market survey and cost analysis were not carried out prior to starting the business. In this article, we will help you with the estimated cost of opening a dry cleaning business in your city.
Estimated Cost to Starting a Dry Cleaning Business
When it comes to starting a standard dry cleaning business, one is expected to spend the bulk of the start-up capital on leasing a facility in an ideal location and of course purchasing and dry cleaning equipment and machines. Please note that the exact cost of opening a dry cleaning business depends on the size and where it will be located.
You are also expected to purchase cleaning supplies, packaging materials, and of course pay of your employees and utility bills. These are the key areas where you are expected to spend your start–up capital on;
- The total fee for registering the business in the United States of America – $750.
- Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines, and other software) – $3,300.
- Marketing promotion expenses for the grand launching of the dry cleaning business in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of – $3,580.
- The cost for hiring a Business Consultant (it includes writing of business plans) – $2,500.
- Insurance (general liability, workers’ compensation, and property casualty, and other related insurance policy) coverage at a total premium – $2,400.
- The cost for payment of rent for a facility for 12 months at $1.76 per square foot in the total amount of – 25,500.
- The cost of remodeling the facility and constructing a standard dry cleaning facility (including installing the needed machines and gadgets) – $10,000.
- Other start-up expenses including stationery ($500) and phone and utility deposits ($2,500) – $3,000
- Operational cost for the first 3 months (salaries of employees, fueling and maintenance of the distribution trucks, and payments of bills et al) – $15,000
- The cost for start-up inventory (cleaning chemical supplies, starch, detergents, and soaps) – ($3,500)
- The cost for storage hardware (bins, rack, shelves, creates) – $3,500
- The cost for the purchase of laundry machines and equipment (Industrial Washing Machine, Industrial blower or dryer, Hand dryer, industrial pressing iron, pressing table, Cloth racks and hangers, Laundry sterilizing machine, Water heater, Laundry basket, store room, and large containers) – $25,000
- The cost for store equipment (cash register, security, ventilation, signage) – $750
- The cost of purchase of distribution van – $15,000
- The cost of launching a website – $600
- The cost for our opening party – $3,000
- Miscellaneous – $2,000
From the rough estimate as listed above, you would need a minimum of one hundred and nineteen thousand three hundred and eighty USD ($119,380) to establish a medium–scale but standard dry cleaning business in any city in the United States of America. Please note that this amount includes the salaries of all the staff for the first three months of operation.
Please note that this is a rough estimate and we usually advise our readers to go to the market or directly contact wholesalers and suppliers of the type of cleaning chemicals, machines and equipment et al, they need in order to get the real time prices of these items.
The truth is that, if you are a good bargainer, you can get a better deal that will help you beat down the estimated price as listed above. Having said that, here are some of the factors that will influence the cost of opening a dry cleaning business in the United States of America.
Factors That Will Influence the Cost of Opening A Dry Cleaning Business
The Choice of Location
One of the major factors that will determine the cost of opening a dry cleaning business in the United States of America is the location. In business, location is a key part of what determines the success of the business.
As a matter of fact, there are business consultants and realtors who are specialized in helping people choose an ideal location for their business; a location that will guarantee them to profitability and to break even within the shortest time frame. So, you will agree that location can influence the cost of starting a business.
Renting or leasing a facility in a location that is off the city center or off a major road will be less expensive when compared to renting or leasing a facility in a highbrow area; a location along a major road with high vehicular and human traffic.
The Required Licenses and Permits
In the United States of America, you cannot open a dry cleaning business without first applying for the mandatory licenses and permits. Of course, you would need an operational license, building license, zonal permits, signage permits, chemical handlers license amongst others.
These license and permits cost money and it will influence the overall cost of opening a dry cleaning business in the United States of America. Please note that there may be several inspections you must pass before you can be issued your license and this will also cost money.
In order to get the overall cost of licensing and permits associated with opening a new dry cleaning business in the United States, we will advise that you reach out to your city government. You also need to consider state and federal requirements.
The Type of Facility
The type of facility you want to operate your dry cleaning business from is also a major factor that will determine the overall cost of opening a dry cleaning business in the United States of America. As regards the facility, you have the options of renting, leasing a store facility in a shopping mall or constructing your own from the scratch.
With renting and leasing a store facility, you may need to modify the store facility to fit into what you have in mind, but there is a limit to how far you can go and it will be dependent on what the landlord of the facility wants. Let us assume that you want to construct your production and store facility from the scratch.
It means that you will buy the land or a property, construct and equip the dry cleaning facility. With that, you will agree that you are going to spend way more when compared to people that rent or lease a dry cleaning facility in a shopping mall.
Your Service Offerings
Another key factor that will determine the cost of opening and operating a dry cleaning business in the United States of America is the service offering of the dry cleaning business.
The fact that there are different types of dry cleaning businesses such as commercial full-service laundry, retail dry cleaning and laundry services, commercial dry cleaning services, and drop off and pick up dry cleaning services, means that you are expected to spend different amounts.
For example, the cost for opening a dry cleaning business that will engage in drop off and pick up services will be far more when compared to the cost of opening a strictly on-site dry cleaning business. With drop off and pick up services, you will be required to purchase a delivery van, and trust me that will greatly influence your startup cost.
The Size of the Dry Cleaning Business
Another very important factor that determines the cost of opening a dry cleaning business in the United States of America is the size of the dry cleaning business.
Of course, the larger the dry cleaning store, the larger the budget to get it up and running especially as it relates to equipping the facility. Aside from the cost of equipping the dry cleaning facility, it will also cost you more to position employees to man different job positions in the store and this will translate to spending money to open the business.
For example, less than a handful of employees can man a dry cleaning business that is in a 12 by 12 facility while it will take about a dozen employees to man a dry cleaning business that is in a 24 by 24 facility.
The Cost of Hiring and Paying a Business Consultant and Attorney
If you want to get your business started on the right foundation, it will be a wise decision to hire the services of a competent business consultant and perhaps an attorney. For example, a business consultant will help with drafting a workable business plan document for the dry cleaning business, a marketing plan and strategy, a comprehensive SWOT analysis for the business, and other advisory services.
So also, an attorney will help you with registering the business, drafting contract documents (especially for your suppliers and creditors), and offer all the legal expertise that will help you start the business on the right foundation. Of course, you will agree that these services will cost you money and it will indeed influence the overall cost of opening a dry cleaning business in the United States of America.
The Cost for Branding, Promotion, and Marketing the Business
The cost for branding, promoting, and marketing the dry cleaning business is yet another key factor that will determine the overall cost of opening a dry cleaning business in the United States of America. Trust me, if you need massive results as it relates to competing and winning a fair share of the available market in your city, then you must be willing to pay for effective branding, promotion, and marketing.
As a matter of fact, it is not cheap to come by an expert in branding, promotion, and marketing that will help you compete with brands that are already determining the market direction of the industry in your city. So, if you add the cost of paying a branding and marketing expert, it will surely increase the cost of opening your dry cleaning business.
The Cost for Furnishing and Equipping the Dry Cleaning Business
Another factor that will determine the cost of opening a dry cleaning business is the cost of furnishing and equipping the dry cleaning facility.
Before you can open a dry cleaning business, you should budget for items like storage hardware (bins, rack, shelves, case), industrial washing machine, industrial pressing iron, pressing table, cloth racks and hangers, laundry sterilizing machine, water heater, laundry basket, and large containers and trolleys, counter area equipment,
Flat Screen TVs, sound system, Satellite dish and decoder, furniture (table, and stools), telephones, filing cabinets, store equipment (cash register, POS machines, security, CCTV, ventilation, signage), and security and fire alarms and prevention gadgets amongst others.
All these will cost money and it will influence the overall cost of opening a dry cleaning business store in the United States of America.
The Cost for Insurance
The cost of paying for insurance policy cover is yet another important factor that will determine the overall cost of opening a dry cleaning business in the United States of America. Interestingly, in the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from.
Thus, it is imperative to create a budget for insurance policy cover and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your business.
The Cost for Registering the Business
The cost of registering the dry cleaning business is yet another cost that will influence the overall cost of opening a dry cleaning business in the United States of America. Although the cost of registering a business is affordable, but it will no doubt add to the overall cost of opening a dry cleaning business in the United States of America.
Source of Your Supplies
Another major factor that will determine the cost of opening a dry cleaning business in the United States of America is the source of your supplies.
For example, if you don’t produce your cleaning supplies and you have to rely on supplies from manufacturers or wholesalers, if you are able to build a robust business relationship with some of the leading cleaning and washing chemicals production companies, you would have succeeded in cutting down the cost of your supplies. As a matter of fact, you can even get your supplies on credit.
Cost of Recruiting and Training Your Staff
The fact that you are opening your dry cleaning business as a new business means that you are expected to recruit and train your staff to conform to the kind of dry cleaning business you want to operate. The training will help you sell the corporate culture of your organization to the new employees.
As expected, it will cost you money to hire expert trainers that will help you train your new hires, and that will add to the overall cost of opening a dry cleaning business.
The Cost for the Purchase and Customizing of Uniforms
Another factor that will determine the overall cost of opening a dry cleaning business in the United States is the cost of the purchase and customizing of uniforms. As expected, your drop off and pick up team, dry cleaners, front desk/payment attendants and security personnel all have different uniforms and they are expected to put on these uniforms when they are on duty.
All these uniforms will cost you money which is why it must be part of your budget if you are looking towards opening a dry cleaning business in the United States of America.
The Cost for Grand Opening of the Dry Cleaning Business
You will agree that in recent times, no dry cleaning business opens its door for business without first organizing an opening party to officially launch the business. This means that the cost of the grand opening of a dry cleaning business is part of the factor that will determine the overall cost of opening your dry cleaning business in the United States of America.
You can choose to do a soft opening if you are operating on a low budget or you can choose to go for a grand opening party. The bottom line is that it is a cost that must be part of your budget and this cost will influence the overall cost of opening the dry cleaning business in the United States of America.
Please note that there are other factors not listed above that will surely influence the overall cost of opening your dry cleaning business which is why we will advise that you work with a result driven business consultant in your city to give you the needed guide and info as it relates to the unique factors in your location.