good only in city?

[James2011]

most people including me think normally the good location for MAT is urban area, high densely populated city.
but in real world, we see at least one or two small or medium sized MATS in suburban town as well....
Because there are already too many MATS in city area, I am thinking about to open MAT in rural area....
Opening mat in rural area is not a good idea??

[pressandclean]

Hithere, my mat is in a rural area. We are one of two mats in a town that only needs one. The problem is that it is extremely hard to attract customers from nearby towns. Actually, next to impossible. That is the problem with rural areas -- there is a definite limit on potential customers. In the city, there is competition, but there is also the potential to do a lot of business. I wouldn't do it again.

For Thanksgiving day from 10-5, we are advertising "free wash" to some of the apartments that are about 7 miles north. They trade at some old laundromats in nearby towns and have been unwilling to even come check us out for some other offers. If I could just get them to come out and see the place, I'm sure they would come back and do their laundry.

[DaveLevenson]

What matters is not the population density, it is the ratio of demand to supply. If there are more people looking for laundry services, that's good, unless there are too many people offering laundry services. A big city has lots of potential customers, and also tends to have lots of laundries. A small town with fewer customers, and fewer laundromats might have a better demand/supply ratio.

I am located in a town of 15,000. The town has two laundromats. Mine averages 3.75 tpd, and makes a profit at that load. We are attended part-time.

When I was shopping for my store, I looked at mats in cities. One, in a city of 150,000, was available for about the same price. That city has about two dozen laundromats, one or two of which are 7,500 sq.ft. 'mega stores'. The city has a lower average household income than the small town. Vandalism is a problem there, so a full-time attendant is necessary. I would be uncomfortable going there after dark. Lots of other considerations.

[James2011]

Dave,

Thanks, you made good points....
now I understand the importance of ratio: demand to supply....

Then, how about size or machine#'s prospect?
IOW, in rural area, big super MAT is definately waste of money, isn't it?
then, the only choice is small mat or medium size mat...
but if population is less than 15,000 and there is already one existing MAT(small size), then I think, only small size mat can be reasonable?
or, medium size can do good ROI??

[wizard]

When looking at building a new store...where ever it is, there isn't going to be more laundry to do (supply/demand ratio Dave noted) it just get's spread around or divided differently.

If you can attract those customers and then keep them, you have something. None of us have that "crystal ball". All you can do, is use good judgement.

[Duane]

I'll be building a very small (I mean very small) mat soon. Maybe I'll start in the next couple of weeks or in the spring.

The mat I am building will only be 20x40. I bought the land earlier this year after the existing mat burnt down. I have been trying to buy this little mat for several years. When it went up for sale I put in an offer, a week later it burnt down - I guess they didn't like my offer.

Why would I want to build such a small mat? The demand is there, even though the town has less than 1600 people. By doing a water analysis it showed the mat was basically breaking even each month and the owner confirmed this (he was amazed I was able to calculate to $38 under his monthly gross).

The existing mat had 7 top loaders at $1.25 and 7 electric dryers at 50 cents for 1 hour. I plan on having 2 triple loaders and 4 double loaders along with some gas stack dryers - all priced at a premium since the nearest mat is 10 miles away.

The mat was doing 2.6 TPD, I calculate that my break even point will be .7 TPD.

Could be a little gold mine for my daughters to run to help them through college. We will be paying everything in cash and doing all of the construction ourselves.

And yes, unfortunately it will be a coin store....... or at least until I can build me a card system. Even a low cost card system costs more than my whole budget for the mat.

Duane.

[Adamski]

Duane,

That would be a great opportunity to set it up for Dollar Coin Only vend pricing. You'd be amazed how easy it is to work with dollar coins.

[Duane]

Larry,

I'll build it as a quarter store until I get me a card system up and running. I'd like to go in quarter increments when raising prices.

Duane.

[James2011]

Duane,

Even if you will take care of all installation works, it will still cost you decent amount of $$...
so, my understanding is the basic costs for building up Mat, such as Plumbing, Electric, Duct, Roof, Floor,etc, is big, even small size store...so, Building small mat in rural area, is it worth to invest?

[Duane]

Hithere,

Not will I only be doing the installs, I will also be building the building myself. The quotes I have so far for the building materials (not equipment) is less that $15,000.

I'll be building on top of the existing foundation that has been inspected and deemed to be sound. The sewer, gas and water lines are already inside the building.
Since the mat will be so small with high efficient equipment, I won't need to up size any of the utilities.

If I can build the business back to where it was before it burned down I would be extremely happy.

Duane.

[STOUT]

Duane;
You stated a .7 tpd on break even?! Wow congratulations.