How to Start a Laundry and Dry Cleaning Business

Part 1 - How to start a Laundry and Dry Cleaning business - Background

Starting a laundry and dry cleaning business can be a rewarding venture, especially in urban areas where demand for convenient and efficient garment care services remains consistently high.

Having said that, launching a successful operation involves more than simply setting up washers and dryers — it requires a strong understanding of fabric care, effective workflow management, and ensuring that each customer receives high-quality, reliable results.

In this comprehensive guide, we’ll walk you through all the essential steps you’ll need to take to start your own laundry and dry cleaning business, from conducting market research and securing funding to choosing the right equipment, setting up operations, and attracting customers.

Our guide is in 3 parts:

• Part 1 - How to start a Dry Cleaning business - Background
• Part 2 - Our planner tool to see if this idea is the right fit for you
• Part 3 - Action plan to get started

Industry Overview

The US laundry and dry cleaning industry — which was valued at $11.9 billion in 2023 — is experiencing steady growth, with the latest figures showing a 3.8% year-over-year increase in overall market revenue.

This upward trend is expected to continue, with the market reaching $12.3 billion in 2024 and being projected to grow to $19.7 billion by 2034, driven by shifting consumer lifestyles, rapid urbanization, and increasing demand for convenient garment care services.

The industry’s primary customer base is largely made up of busy professionals and urban residents — a demographic that is growing rapidly, which means demand for laundry and dry cleaning services is expected to increase significantly in the coming years.

Another major trend, which has come as a response to broader shifting consumer preferences, is the industry’s adoption of eco-friendly practices, using energy-efficient machines and sustainable cleaning methods to attract environmentally conscious customers.

Moreover, the rise of digital platforms has streamlined service delivery, making it easier for customers to schedule pickups and track orders online, which is expected to drive demand even further as consumers increasingly prioritize convenience.

This trend, in particular, is expected to significantly boost demand, making online integration a key driver of growth over the next decade.

Startup Costs

If you’re considering whether a laundry and dry cleaning business is right for you, the first thing you’ll need to know is whether it’s a) affordable, and b) worth the investment. I mean, how much can you actually make running your own laundry and dry cleaning business?

Well, it depends. The initial investment for a laundry and dry cleaning business varies widely based on several factors, such as:

• Commercial Equipment: You will need to invest in high-quality washers, dryers, and pressing machines, with the total cost ranging from $50,000 to $150,000, depending on the overall capacity and functionality needed for your business.

• Lease or Property Costs: You should budget for renting a storefront in a high-traffic area, which can cost anywhere between $1,000 and $8,000 per month. If you are purchasing property instead, you should expect to spend anywhere from $100,000 to over $500,000.

• Renovation and Setup: You will have to allocate $8,000 to $50,000 for preparing the space, installing plumbing and ventilation, and ensuring compliance with health and safety codes.

• Permits and Licenses: You will need to budget between $500 and $5,000 for the necessary business licenses and local permits, such as health department approvals and fire safety permits, to legally operate your laundry and dry cleaning business.

• Initial Inventory: You should set aside at least $2,000 to $10,000 for detergents, cleaning agents, solvents, and packaging supplies, depending on the scale of your operation.

• Staffing: For a standard-sized laundry and dry cleaning business, you’ll likely need to start with 3 to 5 employees, depending on your service hours and whether you offer delivery. The costs will depend on local wage rates and the specific roles needed, but you can generally expect to spend between $2,000 and $5,000 per employee each month.

Keep in mind that a laundry and dry cleaning business, just like any other business, may face unexpected costs in the beginning, such as sudden equipment malfunctions, last-minute compliance upgrades, or unexpected increases in utility rates.

This is why it’s generally recommended to have at least three to six months of working capital on hand, which for a laundry and dry cleaning business usually means setting aside anywhere from $30,000 to $100,000, depending on the size and scale of your operations.

Earning Potential

The earning potential for a laundry and dry cleaning business is generally strong, with most operations benefiting from consistent revenue and healthy profit margins.

For laundry services, typical profit margins range from 20% to 35%, while dry cleaning services usually see net margins between 10% and 25% — both of which are considered quite high when compared to other small businesses.

This is why nearly 95% of laundromats successfully survive the first five years of operation, making it one of the most reliable business models in terms of longevity and profitability.

Simply put, you benefit from high turnover, low overhead costs, and steady demand — factors that create a solid foundation for sustainable financial growth. One thing to never overlook is the importance of customer service, especially in a business where you’re handling people’s personal belongings.

This doesn’t mean that customer service alone is enough to make your laundry and dry cleaning business successful, but without it, failure is almost guaranteed — especially when it comes to dealing with sensitive issues like misplaced or damaged items.

Remember that you don’t want to be in the “one-time wash” business — you want to be in the “repeat customer” business, as nothing is more tied to your profitability than excellent customer service.

How to Start a Laundry and Dry Cleaning Business FAQs

How to set up a dry cleaning service?

To set up a dry cleaning service, you’ll need to research your local market, secure a suitable location, and invest in specialized equipment like dry cleaning machines and steam presses.

You’ll also need to obtain the necessary licenses and permits and implement proper chemical handling and safety procedures.

Is it a good idea to start a laundry and dry cleaning business?

Generally, yes, it’s a good idea to start a laundry and dry cleaning business, as it offers strong profit margins and consistent demand.

Having said that, the success of your venture will always depend on your location, target market, and ability to manage operational costs effectively.

What is the downside of owning a laundry and dry cleaning business?

One downside of owning a laundry and dry cleaning business is how dependent you are on maintaining a spotless reputation.

Your business relies heavily on customer trust, and just one mistake — such as damaging or losing a customer’s item — can really strain relationships and lead to negative reviews, impacting your bottom line.

How to start a laundry and dry cleaning business with no money?

Starting a laundry and dry cleaning business with no money is difficult but possible by exploring options like finding investors, applying for small business loans, or seeking out grants.

You could also consider partnering with someone who has the capital or starting small with a mobile laundry service to build up funds.

Part 2 - Is a Laundry and Dry Cleaning business the right fit for you?

Part 3 - Action plan to launch your Laundry and Dry Cleaning business in 90 days