Laundry Shop Business: How to Start in the Philippines

The urban population in the Philippines is growing at a rapid pace. The busy lifestyles of professionals, students, and even young parents force them to turn to laundry services. Even though there are many such businesses in different localities, the need for them is only growing. In 2024, the revenue in the laundry services market in the Philippines will already surpass $88 million and will develop further, according to experts at Statista (1),  an analytics company. Let us tell you how to start a laundry business in the Philippines so that it starts to bring in revenue quickly.

Why Laundry Business Is a Good Business in the Philippines

The laundry business represents an excellent opportunity for entrepreneurs in the Philippines. And here’s why:

• High demand. Filipinos have a strong culture of cleanliness and personal hygiene. This creates a high demand for laundry services, especially in urban areas.
• Low start-up costs. Starting a laundromat in the Philippines requires a relatively small investment compared to other businesses. You can start with small premises and essential equipment and gradually scale up as your business grows.
• Flexible working hours. Laundromats can work flexible hours, making them a good option for people with other commitments or wanting to be their boss.
• Recurring income. Laundry services are a recurring need, so you can expect permanent income from regular customers.
• There is an ever-increasing number of customers. The country’s growing middle class is fuelling the demand for convenient services such as laundry services.
• Favorable government policies. The Philippine government supports small and medium-sized enterprises, including laundries, through various programs and incentives.

What are the Pitfalls of Laundry Shop Business in the Philippines?

The laundry business in the Philippines, while profitable, has its pitfalls that entrepreneurs must be aware of to ensure long-term success. Here are the common challenges:

1. The initial setup cost for equipment, shop renovation, and permits can be high.
2. Frequent use of washing machines and dryers leads to wear and tear. Repairs and maintenance can be costly and disrupt operations if not managed proactively.
3. Electricity and water bills are significant expenses, especially in areas with high utility rates. Inefficient machines or excessive water use can quickly eat into profits.
4. Don’t forget about seasonal demand fluctuations. Rainy seasons may bring in more customers, but competition increases, and dry seasons might reduce demand, especially for drying services.
5. Lastly, many areas are oversaturated with laundromats, especially in urban centres.

Cost of Starting a Laundry Shop Business

The amount of financial investment in the laundry will depend on your chosen business option — to create an enterprise from scratch, buy an existing business or work on a franchise. The first option will most likely be the most expensive, as you will have to buy all the equipment, hire staff, and repair, if necessary, the premises for the laundry.

The exact amount of money you’ll spend on all of this can also vary significantly on a case-by-case basis: it all depends on the scale of the business, the cost of the equipment, the amount of rent and overheads (water charges, consumables, staff salaries, etc.).

Considering 2025 prices, the cost of opening a laundromat in the Philippines can range from 250,000 to 1 million Php or even more.

How Profitable is the Laundry Business in the Philippines

The profitability of a laundry business in the Philippines depends on factors like location, scale, and services offered, but it is considered a lucrative venture due to consistent demand. On average, a small to medium-sized laundry shop can earn between Php 30,000 to Php 100,000 per month in gross revenue, depending on the number of customers and pricing per kilogram of laundry. Costs typically include an initial investment of Php 300,000 to Php 600,000 for equipment, shop renovation, and permits.

Operating costs, which cover electricity, water, detergent, and labor, can range from Php 20,000 to Php 50,000 monthly. If managed efficiently, a laundromat can achieve a net profit margin of 20% to 40%. For example, with gross monthly revenue of Php 50,000 and operating expenses of Php 30,000, the business could generate a net income of Php 20,000.

Offering additional services like pickup and delivery or express laundry can increase income, while strategic locations in urban areas with high foot traffic ensure a steady customer base. Entrepreneurs often recover their initial investment within 12 to 18 months of operation, making it an appealing option for small business owners.

How to Start a Successful Laundry Business in the Philippines

If you want to start your own laundry business, use our guide to write a business plan and launch your idea. Follow the plan below.

Identify the Type of Laundry Business You Want to Open

Different types of laundries are popular in the Philippines: dry cleaners, coin-operated laundry, home-based laundry, and laundry shops. Research each of these businesses and decide which suits your needs and finances best.

Remember that you don’t always have to create a business from scratch. You can buy an existing launderette with equipment, employees and even regular customers. You only need to improve the existing infrastructure and marketing to suit your needs.

You can open a launderette under a recognizable brand. This is called buying a franchise. This is a good option for those who are afraid of making a mistake at the start of a business. Franchise sellers sell not only their name but also a proven system of operation. They also provide assistance in running the laundromat.

Learn more:
Best Small Business Franchises in the Philippines

Prepare a Laundry Business Plan

A properly written business plan is the key to any successful venture. It helps to structure your activities so that you don’t miss anything important when starting a business. Although the content of a business plan depends entirely on the goals of its creator, there are essential points that should not be overlooked:

1. A brief overview in which you should state the purpose of the business, describe the services, and clarify financial capabilities and prospects.
2. Description. Here, you need to describe the key characteristics of the business, focusing on market needs.
3. Market situation analysis. Write here everything that relates to the industry’s state, competitors’ work, the prospects for the coming years, and possible risks you may face. This is a voluminous point, but it should not be omitted. Study economic data and read economists’ forecasts.
4. Management. In this paragraph, disclose the structure of your business and write who will manage it and what responsibilities the team members will have.
5. Services. List what services your enterprise will provide. Check how much they are in demand in the market.
6. Sales and marketing. Write the price of your laundry services and how much you plan to spend on advertising and customer retention.
7. Plan of operation. Here, you should describe how the laundromat will work and what equipment and technology will be used.
8. Finances. This part includes data on how much you plan to invest in the business, a forecast of future revenue figures, an analysis of the business’s profitability, and an estimate of its payoff time.

Of course, such a business plan looks quite impressive and may frighten a novice businessman. However, if there are difficulties in compiling it, you can turn to professionals to help you calculate the benefits of running a laundry. Another helper can be an entrepreneur with experience in running such a business. Do not be afraid to ask and learn; your future success depends on it.

Find Money for Your Startup

Financing a startup is one of the biggest challenges for any entrepreneur. But even if you don’t have the capital to start a laundromat or your savings are insufficient, you can go to a bank and get a business loan. All major banks in the Philippines provide them. Contact any of the financial institutions and apply.

If you are denied a business loan, you can apply for a regular consumer loan, but it has higher interest rates than a business loan.

Fast Online Loans from Digido for Your Business Needs

Another way to get money quickly to start a laundromat is to contact Digido. We provide fast loans for any purposes, including business needs.

The advantages of this method are:

• Online loan application — you don’t have to visit our office offline;
• Only one government-issued ID is required;
• First loan with 0% interest rate — no need to overpay for a loan;
• No need to look for guarantors;
• Fast application review — around 5 minutes in most cases;
• High approval rate — 95%;
• Money is credited to your bank account all at once.

Need money that you can get quickly? Apply now with just 1 government valid ID! Calculate your pre-approved loan amount:

Learn How to Get;
Startup Business Loans Without Collateral in the Philippines: Personal Loan Options

Select a Good Location

One of the keys to a successful business is a suitable location. Your launderette should be easily accessible to those who need its services. That’s why the best option is to locate the business on the ground floor of a residential building, near a dormitory or a university campus. That’s where your potential customers live, so keep that in mind.

Find out which areas of your community have few laundromats and consider whether that location might be a good fit for your business. Look at smaller towns where service businesses are not yet well developed, so you won’t have much competition.

Here’s what else you should consider when choosing a location for your laundromat:

• Water supply. Laundries consume tonnes of water every day, so if there are water supply problems in your chosen area, your business will not be able to grow and make a profit.
• Electricity. Electricity outages will have a negative impact on the profitability of the business, washing machines will be idle, not making a profit.
• Cost of rent. Too high a rent will have a big impact on your profits. Choose only those laundromat locations that you can realistically afford.
• Safety. Neighborhoods where crime is frequent are not the best choice. Such places are dangerous for customers who are unlikely to risk doing laundry, and for you.

Purchase Reliable Equipment

You must purchase washers, dryers, steamers, irons, ironing boards, and other necessary equipment for your laundry room. All of this equipment should be of good quality to cope with high loads and possible power and water cuts.

It is better to favor trusted brands that are well-established in the laundry market. Among proven models of washers and dryers, choose those that are energy efficient and designed for commercial use. Machines that work at home are likely to last only a short time in the laundry room.

When choosing a washing machine, note that they come in two types:

• With vertical loading. Such models are more affordable and have a shorter washing mode, which is vital in laundry conditions.
• With front loading. These washing machines use less water and are more energy efficient. In addition, they treat things more gently due to the built-in additional functions.

Remember that you will need cash registers and payment terminals in addition to washing and ironing equipment. Make sure to take advantage of these. To keep all transactions moving quickly, invest in a point of sale (POS) system that is compatible with your business. A POS system allows you to track inventory, get reports, and manage invoices anytime, anywhere. It also offers barcode scanning, cheque printing, and sales tax calculations.

Register Your Business

To carry out legitimate activities and protect your business from potential fines and penalties, you must obtain the appropriate permits and licenses. In the Philippines, you must register your business with the Department of Trade and Industry (DTI) for sole proprietorships or with the Securities and Exchange Commission (SEC) for partnerships and corporations.

You must also obtain a permit from the municipality and authorisation from the Mayor of the local authorities, as well as a Taxpayer Identification Number (TIN) from the Bureau of Internal Revenue (BIR). Depending on the location and the nature of the services provided, additional authorisations such as an environmental certificate or a sanitary authorisation may be required.

Hire Employees

For laundries, it is best to hire employees who have already worked in the laundry industry and have the necessary experience. This way, they do not have to be trained and can start working immediately after being hired. However, it is only sometimes possible to find such employees, especially if a start-up entrepreneur still needs to be able to attract qualified employees with high salaries and benefits. Newcomers to the laundry industry will have to be trained from scratch. However, this usually takes little time.

You can find employees by posting job vacancies on social media or placing adverts near the launderette.

Finalize Your Price List

Create a price list for your laundry services. It should attract potential customers and be competitive. To begin with, study the prices in other laundries and calculate your costs. Remember that the price list determines whether and how many customers will come to you. However, too low prices will make your business unprofitable.

Execute Effective Marketing and Branding

If you are starting a business from scratch, you need to make yourself known and build a good reputation for the brand. One of the easiest and cheapest ways to promote yourself is through personal connections. Tell your acquaintances and relatives about your launderette, what services you provide and at what price. Ask them to share this information with their neighbors, colleagues, and friends.

Another effective marketing move is to place adverts on social media. Remember to create a laundry account there, which you will maintain regularly to inform your audience about new promotions and discounts, post customer reviews, and receive orders.

Don’t forget about printed ads; this method of advertising still works well for customers who live in the neighborhood or in small villages where few people use the internet. Put up ads in shops and on special boards in the streets. Print flyers and distribute them through student organizations and homeowners’ associations.

Learn more:
How to Open a Bakery in the Philippines and Why it is a Good Business

How to Take Over Your Local Market

To attract and retain new customers, entrepreneurs must make their businesses unique. Ask yourself the following questions:

• What makes your business stand out from your competitors?
• Why should people come to you?
• How do I attract more clients and retain them?

The following sections of our article will help you answer these questions.

Draw in Customers with Consistency and Quality

Remember that a beautiful interior and many services at an attractive price are not all components of a successful business. One key factor is the quality of service. If your services do not meet the customer’s expectations, they will not come back to your launderette and you will lose money.

To prevent this from happening, try to be better than the competition, constantly monitor the quality of services provided, and hire only courteous employees. Ask customers to leave feedback about the laundry. This feedback will help you fix problems and get better.

Create a loyalty program for regular customers. Discounts and various promotions are great for attracting new customers.

Understand Your Customer Base

Your customers bring you profit, so you need to understand exactly what they need. Study the people who use your laundry service, see which services they order more often and which ones they don’t and find out why this is the case. Maybe the service isn’t popular because it costs too much. Solve this problem, for example, by offering a discount.

Highlight Your Key Selling Features

Your enterprise must be unique. This is not just words; it is something without which success is impossible. Work on improving your business, see what your competitors are doing well, and learn from their experience.

To offer customers extra comfort, set up extra tables and chairs in the room. Offer free Wi-Fi and drinks, as well as air-conditioning so customers can escape the heat.

How Much Sales Should I Expect?

If you’ve chosen the right location for your laundromat, customers will appear quickly, which means you’ll start to recoup your investment by getting paid for your services. But it’s hard to say exactly how many sales you’ll get. It all depends on a lot of factors: competition, the efficiency of your operation, associated costs, and more.

However, knowing all of these components, you can calculate your return on investment.

How Long Will It Take to Get My Investment Back (ROI)?

On average, investments in a launderette can pay off in 1–3 years. However, everything is individual.

Try to calculate how quickly your business will pay for itself using the following formula:

• Return on Investment (ROI) = (Net Profit / Total Investment) x 100%

To find out the net profit, you need to take away the annual expenses (spending on employee salaries, utilities, rent, etc.) from the annual income (how much you earned for the year). Total investment is how much you have invested in the launderette at the time of its opening (repairs, rent, equipment, documents, etc.).

Learn more:
What to Sell Online in the Philippines: Online Selling Ideas and Market Insights

Conclusion

The laundry business in the Philippines can become very profitable if you consider all the nuances and carefully plan your expenses. Do not be afraid of difficulties and remember that the demand for quality services in the country is regularly growing. We also advise you to get acquainted with your competitors to find out how they started their business and get practical advice from them, or on the contrary, avoid the mistakes they made.