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How To Start A Laundry Business Philippines 2022

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    Setting up a laundry business in the Philippines can sometimes be challenging.

    But fear not!

    We have exclusively put together a full guide to starting a laundry business in the Philippines.

    This guide will cover the best location for setting up a laundry business, costs, and extra tips…

    Oh yes, and a few special hacks.  

    The most important thing at the very beginning is to have a laundry business plan.

    A plan will help you estimate your laundry business profit in the Philippines.

    And the costs involved, the risks, and so much more.

    If you want to set up a home-based laundry business in the Philippines, we will also explore this option.

    Starting A Laundry Business In The Philippines

    1. Your Laundry Business Plan

    Writing a business plan is the key to any business.

    Listing the services you wish to offer, including additional services such as pick-up, delivery, and wash-and-fold, should all ideally be completed in the initial business plan. 

    Laundry shop owners usually target customers such as; busy professionals, residents of apartments, students living in dormitories, etc.

    Laundry shop design Philippines

    Whichever type of customer-owners choose to target, it is important to research if the laundry service demand is met for their intended market.

    In setting up a laundry business in the Philippines…

    You will need to know ways how to make your business different from the competition. (unique selling point/emotional selling points)

    A few techniques used to stand out in business are to offer something different.

    Such as; special services, a comfortable waiting area for customers, customer promotions/loyalty programs, delivery, etc.

    One question you may have in the planning stage is…

    How much does it cost to start a laundry business in the Philippines?

    Considering all the costs given, an overall budget of more or less 900,000 PHP would be needed to start a laundry business in the Philippines (including equipment, marketing costs, staff costs, rent, survival budget, etc.

    Nevertheless, as mentioned, there are many factors to consider for the actual prices given.

    For example, if you are looking at how to start a home based laundry business in the Philippines, then your costs will be considerably lower compared to those looking to start a laundry business in a store on the high street.

    Below is a list of the most common areas of a business plan you will need to focus on when looking at how to start a laundry business in the Philippines.

    • Exclusive Summary
    • Competition
    • Target Market
    • USP/ESP
    • Financial Summary (Costs And Profits: Including Equipment Costs, Building Costs, Survival Budget, Etc.)
    • Growth Analysis (Opportunities For Cross-Selling/Upselling, Etc)
    • Staffing (If Applicable)
    • Marketing Plan
    • Operations
    • Market Research

    Filipino wealth has put together an exclusive free business template targeted at businesses in the Philippines! This plan can be downloaded easily below.

    2. Your Laundry Business Location

    Finding an ideal location is next.

    Finally, you could consider a location that is easily accessible to your target market.

    For example, a space near apartment complexes would be a great area to start a laundry business in the Philippines.

    how to start a laundry business Philippines

    This is because some people in certain types of accommodation do not have their own washing machines. 

    It is likely a wise decision to avoid choosing a location near competition.

    If the rental of the chosen location is too expensive, you could open a pick-up station instead.

    (This is often the best option for those looking to start a home based laundry business in the Philippines).

    If you are considering this, a floor area of at least 25 sq meters would be needed.

    Owners also need to check that there is sufficient water supply and that the water does not have many minerals.

    These could affect the laundry process. 

    You could save start-up capital if your laundry business in the Philippines were set up at your home.

    (As mentioned in the planning stage).

    Rental costs are normally covered as home based laundry businesses are, of course, working from home.

    Therefore you could save anywhere between 20,000-80,000 PHP Per month from rental costs.

    3. Renovation And Equipment 

    As mentioned, having a sufficient water supply is vital in a laundry business.

    To do this, owners need to ensure that the right plumbing system is installed.

    It should systematically produce and flush out water.

    For safety, the installation of proper ventilation is also a must.

    For self-service laundry shops, owners should have a comfortable waiting area for customers.

    franchising laundry business Philippines

    (you may also be able to sell items in a waiting area – a vending machine business could do very well here).

    If the systems needed are not in place in the location…

    The renovation expenses could be up to 200,000 PHP.

    This fee could also include electrical wiring and unique plumbing systems.

    It is crucial to equip with high-quality and professional laundry equipment when you set up your laundry business in the Philippines.

    These may be more expensive, but you could save more time and electricity, which could save more in the long term.

    In choosing a washing machine, you could opt to get washing machines that have a big capacity and a drum of a decent size.

    Also, it should be able to complete a washing cycle fairly fast.

    The washing machine of your choice could or could not have a dryer installed.

    Laundry shop design Philippines

    If you opt to get the one without a dryer, you could buy a separate dryer with a built-in sensor to help with its maintenance, such as detecting moisture and overheating prevention. 

    Also, it is recommended to have a machine that can operate for at least 5+ hours each day. 

    The price range for each washing machine used in laundry shops can range from 20,000 PHP to 50,000 PHP (depending on the size & brand).

    If you plan to have a self-service laundry shop, machines with a card or coin insert or modern machines cab cost around 25,000 PHP to 50,000 PHP.

    This is estimated on the latest data.

    On research, you may be able to save many thousands if ordering in bulk, but this will depend on the size of your operations.

    For equipment packages, you may need to shell out 500,000 + PHP.

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    These packages often include three sets of easily stacked washers and dryers.

    These are a wonderful choice for some when looking at how to start a laundry business in the Philippines.

    You could also check out Laundry Setup PH for laundry business packages.

    Some retailers across the Philippines also provide setting-up and renovating services. 

    For steamers – branded ones usually cost around 3,500 PHP to 7,000 PHP and 1,500 PHP to 6,000 PHP for irons.

    Since steaming and ironing are additional services, the rate per load does not include these.

    Nevertheless, many customers prefer to pay more to save time. 

    If you still have a budget left, considering getting a dry cleaning machine could be a great investment.

    Not many laundry businesses in the Philippines offer dry cleaning services, which could be a unique sell point (USP) for your business.

    In addition, some services can be seasonal.

    For example, dry cleaning may be at its peak during prom and wedding months.

    4. Business Permits And Licenses For A Laundry Business

    Entrepreneurs need to deal with legal and government fees in connection with setting up a laundry business in the Philippines.

    First, owners should register their laundry business with the Department of Trade and Industry for a sole proprietorship.

    Otherwise, business owners will need to go to the Securities and Exchange Commission for joint ventures or corporations. 

    Next, they would need to head to the municipal hall to secure a business permit.

    40,000 PHP might be needed since the Mayor’s Permit may cost more than 10,000 PHP.

    You may need to submit the Mayor’s Permit together with the business transaction form. 

    A Certificate of Registration and Tax Identification Number needs to be obtained from the Bureau of Internal Revenue.

    In addition, if there will be five or more employees in the laundry shop, owners need to register with PhilHealth and Social Security System

    For laundry business franchises, they are responsible for registering the business and permitting owners to use its name. 

    5. Find Employees For A Laundry Business In The Philippines

    For home-based laundry businesses in the Philippines, owners would not likely need to hire staff.

    However, for laundry shop owners, hiring employees could be needed since owners would want to have people around in case a lot of customers came in. 

    If you are thinking of getting people, you could start with a cashier, a staff responsible for assisting customers and delivery, and a driver.

    For self-service laundry shops, 1 to 2 employees are often enough to operate for the first 3 to 6 months. 

    If you had more customers, you could hire more people based on demand in the long run.

    For example, in Metro Manila, the minimum and the average salary of a laundry shop staff is 12,000 PHP with benefits for 25 working days.

    6. Bills And Taxes For A Business In The Philippines

    For businesses with gross yearly sales of under 1,5000,000 million PHP, laundry shop owners in the Philippines must pay a percentage tax.

    This could be equal to around 3% to 5% of the monthly income, depending on what bracket the business falls in. 

    cost to start laundry business Philippines

    For those who have or will set up a corporation…In the Philippines, the corporation tax currently stands at a standard of 30%.

    As for the monthly bills, these vary since it depends on the amount of energy the laundry shop uses and how energy-saving the machines are (if the shop has 5 to 10 machines with an air-conditioner, the monthly electric bill could reach 20,000 PHP and 15,000 PHP for the water bill).

    7. Making Your Laundry Business Successful

    In the above steps on how to set up a laundry business in the Philippines, we can see that there are many steps to be successful in this business.

    However, some steps have not been included but are just as important, for example, the marketing of your business.

    Marketing is one of the most important things in a business.

    Of course, people need to know where your laundry business is and what you provide, but where a lot of business owners go wrong is believing that this is all they need to do.

    It’s not enough to tell people about your business.

    You will need to convince them to use your service and become a regular customer of yours.

    That is the true power of marketing.

    Once you have reached this stage, you will most likely be ready to open your laundry business or have opened.

    Next, it’s time to move on to the start, stop, and continue stages.

    Start:

    This is the point where a business owner needs to analyze their current situation and decide the most appropriate and profitable course of action.

    In other words, what things do they need to start doing for the business to be successful.

    Stop:

    At this part of your journey on starting a laundry business in the Philippines, you will most likely not have many tasks you need to stop.

    But if your business is losing money, perhaps you are marketing to the wrong kind of people or opening up your business too late, then this is the time to stop any business-draining actions.

    Continue:

    The last part of starting a laundry business in the Philippines is to continue the operations making progress.

    For example, perhaps you offer a delivery service that brings in more customers and makes more profits.

    It’s very common for business owners to strengthen what is weak, but unfortunately, some continually forget to strengthen what is strong.

    Home Based Laundry Business In The Philippines Tips

    Some home-based laundry businesses offer valuable services such as delivery and other essential services.

    Therefore, setting up a laundry business in the Philippines at home would need fewer start-up expenses.

    Here are a few simple tips for starting a home based laundry business in the Philippines.

    Tip 1: Choosing Where To Work

    Performing the laundry at the client’s house could save you many pesos on operating expenses, such as water and electricity. 

    Altanativlty if you are working from home, you will often need an area of at least 25 square meters.

    Tip 2: Price List

    Extra services such as ironing and dry cleaning could boost your home-based laundry business profit in the Philippines.

    It would help to refer to other local competitions for the prices.

    When determining the price, you could take into consideration product, utility, and commuting expenses. 

    Try to mix and match certain services to offer your clients a better service for a lower rate while still making a good profit margin.

    There are also many options to cross-sell & upsell in this business.  

    Tip 3: Record Keeping

    Some of the things owners need to track are the clients, the payments received, and the expenses.

    Again, you would not need to buy a financial-management program.

    Instead, using Google or Excel spreadsheets could effectively keep track of these transactions for free.

    This is also very important for areas such as tax or when customers have not paid.  

    Tip 4: Buying In Bulk

    Unlike a commercial laundry shop, you could start a home-based laundry business in the Philippines for under 200,000 PHP.

    But how can you save even more?

    The answer is bulk.  

    Buying items in bulk will almost always save many thousands of pesos.

    Before purchasing detergents, powders, and fabric softeners in bulk, it is a good idea to try them and check if you are satisfied with the quality.

    Alibaba.com is a great way to save many thousands of pesos by buying items from china directly to the Philippines.

    There is often an import tax to be made aware of,  especially if you purchase many units…

    But you could still save many pesos through this method.

    The tax and delivery may be taken care of, depending on the selling business.

    Is A Laundry Business Profitable In The Philippines

    If you start a laundry business in the Philippines with 50 kg to 55 kg average laundry services each day, then there is little room for profit in the early days.

    This is because the cost of business takes up the majority of profits.

    However, for an average of 75 kg per day, you could earn around 10,000 PHP per month.

    When looking at a laundry business profit in the Philippines, it’s a common question to ask if the profit is different if you own a laundry shop.

    The costs are different, so it is often harder to reach a profit

    BUT…

    A store has many benefits above financial matters.

    But as a financial example, let’s say the average laundry service could service anywhere between 100 kg to 120 kg every day.

    With this amount, an earning of 30,000 PHP + each month could be possible.

    A laundry shop that hit 150 kg a day could earn 50,000 PHP+ every month.

    What Is A Daily Day Like In A Laundry Business

    To better understand if a laundry business is for you, let us see what it is like to operate it.

    It does not matter whether one works independently or has employees since there will be similar tasks needed to be completed every day.

    Every day, owners of home-based laundry businesses in the Philippines need to promptly open and close the shop, clean, secure money, and check the machines for maintenance.

    For owners who hire employees, they have other responsibilities.

    For example, after hiring, a business owner may need to supervise their employees and check how well extra services are given, such as ironing or washing, and folding clothes. 

    Usually, laundry shops operate from 7 am to 6 pm every day.

    However, weekends are the days when there are many customers, so it is recommended to open on either a Saturday or Sunday.

    Business owners could also consider alternate operating hours depending on the market they serve.

    The most important thing is to open on time since customers allot a specific time of their day to do laundry. 

    Is Starting A Laundry Business A Good Idea

    After carefully considering how to start a laundry business in the Philippines, I feel that starting a laundry business is a great business opportunity.

    Still, there are certain risks that an entrepreneur will need to be mindful of.

    Many of these risks are financial risks.

    The location and service are the most important factors when determining if a laundry business is a good idea in the Philippines.

    Therefore, this could be an excellent business opportunity to promote the right service to the right client in the right location.

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