Laundromat Deal Simulator: How to Underwrite Any Store in 2026 (Free)

Every laundromat I've watched a first-time buyer torch in the last sixteen years died from the same wound: a broker pro forma that lied, and a buyer who didn't have the tools to catch it. The numbers were "industry standard." The store was "absentee-run." The seller had "tax returns." And six months in, the new owner was personally guaranteeing payroll out of a HELOC because the actual economics never matched the deck.

This guide is the antidote. It walks through the five ways a broker package will mislead you, the seventeen numbers every laundromat deal actually hinges on, and how to use the free WashBizHub Deal Simulator to stress-test any store in about ten seconds — before you wire earnest money, not after.

It is long because the topic deserves it. Bookmark it, send it to your spouse, share it with your SBA loan officer. If you only have ten minutes, jump straight to the three live scenarios and drag the sliders.

Why broker pro formas almost always lie (and not always on purpose)

I have read several thousand laundromat listings. Maybe one in twenty contains a pro forma I would underwrite to without modification. The other nineteen aren't fraud — they're a predictable pattern of optimism that the industry has normalized. There are five sins in particular, and the Deal Simulator was built specifically to catch all five at once.

1. The seller's best month, annualized

A laundromat's revenue is seasonal in ways most other small businesses aren't. Cold-weather months drive heavier loads, dryer cycles per wash spike, and wash-dry-fold (WDF) tickets fatten because customers don't want to hang clothes outside. If the seller hands you a pro forma built off January through March utility revenue and projects it across twelve months, you are looking at a number that is structurally 12 to 18 percent too high. Always ask for trailing twenty-four months of utility bills, not gross.

2. Working-capital float on commercial AR

Any store with a meaningful WDF or commercial route account has receivables. Hotels pay net-30, restaurants net-45, gyms sometimes net-60. A pro forma that books revenue when the laundry is done, but hasn't reserved cash for the gap before the customer pays, is overstating year-one cash flow by two to four percent of gross. The Simulator computes a working-capital reserve line item for any commercial mix you specify.

3. BOD/TSS sewer surcharges on commercial wash water

Residential coin-op water doesn't get hit with BOD (biological oxygen demand) or TSS (total suspended solids) surcharges in most municipalities. Commercial linen wash absolutely does, because grease and food residues from restaurant flat goods push the effluent over the threshold. The EPA Six-Year Review framework lets municipalities tier these charges aggressively, and a 2,500 square-foot WDF-heavy store in a strict jurisdiction can pay an additional $400 to $1,800 a month in surcharges that don't appear on a typical broker pro forma.

4. Loaded labor, not stated wages

"$15 an hour, 60 hours a week" is not what labor costs. Loaded labor — wages plus the employer side of payroll tax (7.65 percent FICA), state unemployment, workers' comp (steep for laundromats because of moving machinery), and any benefits — runs 1.18 to 1.32 times stated wage depending on state. A pro forma that just multiplies hours by hourly rate is undercounting by roughly 25 percent. The Simulator builds bottom-up from loaded labor and shows the multiplier in the breakdown.

5. Regional utility tariff blindness

Two identical 60-pound washers in Phoenix and Brooklyn do not cost the same to run. Brooklyn pays roughly $0.024 per gallon all-in (water plus sewer), Phoenix about $0.011, and Atlanta closer to $0.018. Gas and electric tariffs vary just as widely. A national average pro forma is wrong everywhere — too generous in expensive markets, too punishing in cheap ones. The Simulator pulls regional tariff data into every cycle calculation.

The seventeen numbers that decide every laundromat deal

If you understand these seventeen numbers and where they come from, you understand laundromat underwriting better than most brokers do. The Simulator computes all of them and shows the formula behind each — hover any metric on the results page to see the source.

#	Number	What it tells you
1	Turns per day per washer	Demand. Healthy: 4–6 turns. <3 means the store isn't busy enough.
2	Average vend price	Pricing power. Most US stores 2026: $4.25–$6.75 for a 30 lb load.
3	Dryer-to-washer cycle ratio	Throughput. Should be 1.6–2.2 dryer cycles per wash.
4	Revenue per square foot	Density. $150–$350/sqft/yr is the healthy band.
5	Utility load (gal/cycle, kWh/cycle, therms/cycle)	The biggest variable cost. Driven by machine age and efficiency.
6	Loaded labor as % of revenue	Mode-dependent — see the labor band table.
7	Rent per square foot per year	$18–$48/sqft NNN typical. Watch escalators in year 3+.
8	CAM, taxes, insurance (NNN)	Often $4–$9/sqft on top of base rent. Frequently omitted from broker decks.
9	NOI	Net Operating Income — what's left to service debt and pay you.
10	Annual debt service	Principal + interest on the SBA 7(a) or seller note.
11	DSCR	NOI ÷ debt service. SBA wants ≥ 1.25. Below 1.0 the store can't pay its own loan.
12	Cash-on-cash return (year 1)	Cash flow ÷ cash invested. 12–25% is the healthy band.
13	Payback period	Years to recover total investment. < 6 is excellent, > 10 is a flag.
14	10-year DCF IRR	Time-value-adjusted return including terminal exit. Hurdle: 15–20%.
15	CapEx reserve as % of revenue	3–6% per year. Anything less and you'll fund the next refresh from your pocket.
16	PPOH (pounds per operator hour)	For WDF/OPL only. TRSA benchmark: 115–160 lbs/hr.
17	Working-capital reserve	60–90 days of operating expense. The most-skipped line in any broker deck.

DSCR, IRR, cash-on-cash — explained for people who don't speak banker

If you only learn three ratios, learn these three. They are the language SBA loan officers, equipment finance brokers, and serious private buyers use to talk about a deal. Every Simulator result puts these front and center.

DSCR — the one number that kills more deals than any other

Debt Service Coverage Ratio is your annual NOI divided by your annual loan payment. The SBA 7(a) program — the loan you're almost certainly using to buy a laundromat under $5 million — requires a minimum projected DSCR of 1.25. That means for every dollar the loan demands, the store must generate $1.25 of NOI. There has to be a 25-cent cushion.

If your DSCR projection comes in at 1.10, your loan officer will smile politely and pass. If it comes in at 0.95, the store literally cannot pay its own debt — you would be funding the loan personally every month. Most failed laundromat acquisitions fail this single ratio, and they fail it because the buyer was looking at a broker pro forma that didn't include loaded labor, sewer surcharges, or working capital. The Simulator rebuilds the NOI from the ground up so you see the real DSCR before you sign.

Cash-on-cash — what your money actually earns in year one

If you put $200,000 of your own cash into a deal (down payment, closing costs, working capital reserve) and the store throws off $34,000 of free cash flow in year one after debt service, your cash-on-cash is 17 percent. That is the number to compare against any other place you could have put that $200,000 — index funds, real estate, a bond ladder, your kid's college account.

A healthy laundromat acquisition delivers 12 to 25 percent cash-on-cash in year one and trends up as you raise prices, add WDF, and pay down the loan. Below 8 percent and the deal isn't paying you for the work and the risk. Below zero and you are subsidizing the seller's exit.

10-year DCF IRR — what you actually walk away with

Internal Rate of Return on a discounted-cash-flow model is the metric that matters most for the buy-hold-sell investor. It bakes in ten years of cash flow, the time value of money, and a terminal sale at the end (typically valued at 3.5–4.5× exit-year SDE for a healthy laundromat). A deal with a DCF IRR under 10 percent is rarely worth the effort. 15–20 percent is the band serious buyers underwrite to. Above 25 percent, look harder — something is probably too good.

The labor band trap: why "25 percent" is the wrong threshold for most stores

You will read in nearly every laundromat-buying article that labor over 25 percent of revenue is bloated. That single threshold has cost more buyers more money than almost any other piece of bad advice in the industry, because it is true for exactly one operating mode and badly wrong for the other three.

A self-serve coin-op store with no attendant runs labor at 5 to 8 percent of revenue. A hybrid store with a part-time attendant and a small WDF line runs 12 to 18 percent. A full-service WDF store with two attendants and a delivery driver runs 20 to 28 percent — labor is the product. An on-premise laundry plant serving hotels and restaurants runs 26 to 34 percent and that is excellent execution. Holding all four to a 25 percent ceiling means flagging healthy full-service and OPL stores as broken, and missing the genuinely bloated hybrids.

The Deal Simulator's diagnostic engine uses scaled per-mode bands. Here they are in plain numbers:

Operating mode	Healthy	Watch	Bloated
Self-serve coin-op	5–8%	≥8%	≥12%
Hybrid (attendant + light WDF)	12–18%	≥16%	≥22%
Full-service WDF	20–28%	≥25%	≥32%
On-premise laundry plant (OPL)	26–34%	≥30%	≥38%

Tell the Simulator your operating mode and the diagnosis adapts. A 27 percent labor ratio earns "right at the ceiling, watch payroll creep" for a full-service store and "bloated, restructure the labor model now" for a hybrid. That distinction is the difference between negotiating a fair price and walking away from a fine deal.

Three live scenarios you can stress-test in ten seconds

Theory only goes so far. Here are three real, fully-loaded scenarios baked into the Simulator. Each link drops you straight into the running simulation — no signup, no email gate. Drag the sliders and watch the verdict flip from PASS to RENEGOTIATE to BUY.

Sensitivity sliders: how to negotiate with a number, not a feeling

Once a scenario is running, the Simulator gives you three sliders that re-run the entire 52-week simulation in under a second: asking price (±20%), vend price (±$0.50), and rent (±25%). This is the single most useful negotiation tool I have ever put in a buyer's hands.

Take the Brooklyn scenario. The seller is asking $475,000 and the verdict pill reads RENEGOTIATE — DSCR 1.18, IRR 11%. Drag the asking price slider to −12 percent and the same store becomes BUY at DSCR 1.31 and IRR 16%. You now know exactly the number you need to walk away with: $418,000. Not "lower," not "around four hundred." A specific number, defended by 52 weeks of simulated cash flow, that you can hand to the broker.

Or try the inverse: leave the price alone and drag the vend slider up by $0.50. If the store flips to BUY on a fifty-cent vend bump, you have just discovered that the previous owner has been leaving money on the table for years and the deal is actually fine — the next operator (you) just needs to raise prices. That's a different negotiating posture entirely, and it's the kind of insight broker pro formas can't give you because they're static.

The hidden costs that turn 18% IRR into 4%

A few line items the Simulator includes that broker decks almost never do:

Sewer surcharges (BOD/TSS)