Robert J. Renteria is a national consultant based in Chicago. He has more than 21 years of industry experience, and has helped develop more than 750 laundries nationally and abroad. He was named the 2010 Chicago Latino Professional of the Year and is the sole recipient of the 2011 International Outstanding Humanitarian Award. He has also written two biographical books, From the Barrio to the Board Room and Mi Barrio. He can be reached at 312-933-5619 or email@example.com.
CHICAGO — The cost of iron for new products is going up dramatically. Meanwhile, increasing utilities cost and escalating rent are eating up laundry profits.
I have been researching the best way for you to maintain your existence in this industry. When purchasing machines, you must seriously look at refurbished washers and dryers as an option.
The cost to purchase refurbished equipment is well under 50% versus buying new. The average “life cycle” for most owners to stay in this industry is three to five years. What’s the point of digging yourself into a hole you may never be able to dig yourself out of?
Now, the newer machines are more energy-efficient and offer warranties, which is important. But if the refurbished or rebuilt machines are purchased from a reputable company that stands behind the quality of its work, you will come out ahead, bottom line.
Recently, I did some consulting for an investor who decided to go 100% refurbished for his remodel. He saved about 58% of the total cost of going new, or more than $165,000.
Now, if you do the math and calculate what your monthly payment would be on the additional expense of buying new equipment, you are looking at eating right into your bank account big time.
Many laundries are closing across the United States, mainly due to high rents that need to be adjusted. If you’re just getting into the game, you’d better plan on doing some good negotiating to get your rent reduced to a level that will help keep your business going.
If you’re looking to stay in the game long term, and this is going to be your new life, then I recommend that you look at new products, especially if you’re planning on building a new Laundromat.
CHICAGO — During the past year, numerous people have asked me the same question: Should I buy new or used equipment? That’s not a hard question, given the economy, but your answer needs to be based on your long-term goals and objectives.