EP 82: How to Sell a Laundromat with Chuck Post, Author of THE LAUNDROMAT An American Dream Business & An Entrepreneur's Playground

Ed Mysogland  
One of the reasons I love this podcast and have been doing it, I think we're on we're in our mid 80s Now, and it never ceases to amaze me about different businesses. And this one, this one's about laundromats and you would think that it's a it's a laundromat, how exciting can that be. And I've I was I was just talking to chuck post Chuck post is the author of the book, the laundromat and an American dream business and entrepreneurs playground. And so I, I have to admit that I came into this interview thinking that, you know, this is just gonna be about, you know, how how investors shelter income, how, how to, you know, keep your equipment in good condition, but it was anything but that, I mean, this is about, you know, this is more it, it's an investment, a substantial investment at that, and communities and, and social media and different ways to attract people that are a saving people time, this isn't just, you know, in the middle of the dilapidated dilapidated area, you know, and you're fighting over a quarter this is this is a destination location and, and that's the kind of of laundromats that this guy's talking about. Not in a million years did I think that, that our conversation was gonna go this way, but I asked at the end, I totally understood and bought into the direction and why laundromats make so much sense. As you know, as an entrepreneurs, you know, as part of an entrepreneurs portfolio, this is a this is a heck of a business, and I'm certain any seller, any business owner that that owns a laundromat will be sitting there, you know, just in awe of what can be done, and how to do it in order to make your business saleable, and what to do in order to, to command a premium value. So I hope you enjoy and I shouldn't say I hope I'm certain you'll enjoy my conversation with Chuck post. He is the author again, of the laundromat and American dream business and the entrepreneurs playground. Well, welcome to the show, Chuck.

Chuck Post  
Well, hi. Nice to meet you.

Ed Mysogland  
Nice to meet you. Before he came on, I had kind of given everybody a high level overview of you and and your practice, but I'm probably didn't do it justice. So can you talk? Can you talk a little bit about what your practice and how you're serving the laundry community?

Chuck Post  
Well, yeah, basically, we are consultants to laundry investors, whether they are laundry or our new buyers. The majority of our work is probably towards the new buyer bringing them in because while the laundromat is a very simple business to operate, the investment model is extremely complex. And that's where people fail. In fact, that turnover rate on laundries is is like four years, maybe five Yeah. Well, yeah, because people don't feel what they're buying. They when they get into it, they're not well heard.

Ed Mysogland  
Yeah, well, yeah. And it's funny we we have historically we talk more people out of business than into business because they just don't understand what they're getting themselves into. And I think that's just across the board. But well, what firstly thing let's let's talk about your book. So you literally wrote the book about the laundromat. It's called the laundromat the American dream business and an entrepreneurs playground. So So can you talk a little bit about it first, and then we'll dive into some of the questions.

Chuck Post  
No, twist my arm? Yeah, I'll tell you. The book is a is a deeply inspired from my, through my career. I've been wanting to do it for many years. And actually it was when COVID hit that I put my mind to it. I've been writing at it, you know, for a year or two ahead of time, but COVID came I put my mind at it and got it done. And I brought up the first edition a year ago but it was orally edited, I did everything I could spend way more money than I should have tried to get somebody to edit it. But they just people weren't working very efficiently at that time. And so I published it, and started to do the revisions on it. And we've just completed that revised book, it's now coming online, probably within a week or so this time, and it will be available at our web page, as well as the book, the book goes into in depth of what people need to know about this business that tells all the secrets. You know, we spend a lot of our time helping people out of problems, when they're when they own a laundromat, you know, because the simple reason that this is the most important thing I can tell your listeners is that a laundromat is developed at a huge cost of infrastructure, and so on and so forth. And the leases are typically 25 to 30 years long, with this broken into a 10 year period, possibly, and a series of five year options in this sort of thing. But the equipment only lasts 12 years. And the equipment runs about $6,000 per machine. I'm sorry. Okay. There's a little pause. So

Ed Mysogland  
I Yeah, no, no, I, I, I wanted to ask, you said 25 year leases. So I know, I'm probably getting a little ahead of ourselves. But that seems like a lot of time to have a personal light, you know, you know, likely there's a personal guarantee, likely, I mean, the ones that we've seen, I'm sitting here going Well, geez, that's a 25 year with a with a personal guarantee, and then I go to sell it. I've got my personal guarantee sitting there. And my landlord has no motivation. Let me off the hook.

Chuck Post  
The right. Okay, so let me let me take a minute. And kind of run it down for you. Because I think I'll bring some light to this. First of all, the cost of developing a laundry, you know, in California right now is $150, the foot plus a, that doesn't count bringing the transformer and if it needs and that sort of thing, okay, so there's more costs than that. But that's about the construction costs to create a laundry mat, then you have all the equipment to buy, the average piece of machinery that we put in a laundry now is over $6,000. And we're putting in maybe 30 to 40 washers, and maybe, you know spending about half that amount again, and the dryers and then you've got maybe 100,000 $150,000 in pay system, change machines, and so on. And so hot water systems, you know, we'd like to put things like sanitizers in the laundry, which brings more homeowners into the stores and things like this. So the cost, you know, for a small 2000, square foot store six 700,000 New, okay, so the fact is, is that, if that's not done, right, the first guy is gonna have a hard problem, maybe making it, you know, unless he's got a real plan, but you know, so it kind of depends on how he buys it. But that's a different subject. So going from there, yeah, going on from there, he needs to operate it for a period of time, it will take him six months or so to bring it up to where he needs to pay everything and maybe only a couple three months of carry costs, but about six months to bring it up to a base level model, which is we build models in a particular way in our business, and maybe we'll have time to explain that a little bit. But once we once we build that model and restore everything, you know, then we know what what its value is. Okay, once it hits a certain level, we basically the most common multiplier of of profits, or cashflow, I should say, is 60 times monthly, or for about a 20% Buy in return on investment. Okay. That's a lousy return on investment, in my opinion, because I know what these stores can do and what kind of returns they really can make. All right. But for most people that's about the buy in level and they may find after making some corrections is down closer to 17. But if they're unfortunate enough to purchase a store that doesn't have a sustainable path, and this is the problem is that people buy laundry thinking that the equipment will last and last and last. They just have to keep fixing on it. Nobody that selling the store will tell him any different. You know, the brokers don't go out of their way to say Yeah, but you know, you got because you're gonna have to invest another $300,000 into this business. And here's the other thing. Nobody's gonna sell it until this the equipment's about eight or nine years old. If it's doing well unless a life situation reps, which is, you know, not as common as as, as you hear about the reason for selling to be, you know. But the fact is, is that when it's time to sell it, you know, they have to have something to sell. And if it has no sustainable path for that buyer, so when you buy the store, you have to set it up for success. And as you said, you do you are signing personal guarantees and on the hook, and the landlord may or may not be willing to let you off the hook upon assignment. That's something that we do negotiate laundry leases have specific requirements. But we do negotiate that in laundry leasing, if somebody has the common sense to use a laundry expert to help them negotiate the lease. But the the fact is, is that when somebody buys it, you're only on the hook for that initial 10 years unless you pick up an option. But even at that point, every time the laundry transfers, we need to renegotiate the lease to extend those, you know, when we when we go into what sellers need to do to prepare, or buyers need to do to prepare we can we can cover these in more depth too.

Ed Mysogland  
Yeah, well, one of the things that you brought up, had to do with the equipment. Last couple weeks back, I had an equipment appraiser on it, and it goes right to the same thing that you're saying that, that, you know, they go to they get ready to sell. They're not reinvesting in the equipment. You know, for me, I don't look at depreciation and in a laundromat, I mean, I just that's deterioration. I mean, I think adding that back is probably I don't say misleading, but I that's a that's that's a real number, rather than just accounting, you know. And so I guess where I was heading with it is, when you when you're looking at profit, how are you defining it? I mean, is it true net profit? Because you're talking 60 times monthly profit? What does that define? Like? True net? Yeah, true net profit.

Chuck Post  
There's no depreciation or taxes there. You know, we were very interesting business, because those of us who are have an expertise or are well and understand the science of the laundry, I have no problems with that. Because we know the advantages when we replace the equipment right now we go we are going in and replacing equipment in stores that are still you know, barely breaking even, maybe their profits are down a couple $3,000 Is All You know, but they're still breaking even paying the IRS unless something big happens to them. But they've got old equipment, and they have the leases is wound down. Maybe they have 15 years left or less. Okay. So they have no exit strategy. All right. So somebody comes in and buys this like that. And unless they know what they're doing, this is happening all the time. And that's why people are selling the stores, they get in and then discover that the woman's done. Yeah, let me explain something. laundry equipment is not not a fixture, like people may think it is. It's it's while it's bolted to the floor, and even we even excavate down into the floor to put it in a trap to hold these high extracting monster machineries. You know, even all that right? What it is, it's a consumer use product. And if it don't look good, if it don't work good, you know, if it stalls out in the middle of a cycle, you know, if then then all of a sudden, it's a bad review, and you're branding yourself negatively. On the other hand, if you look at it like I do, you know, when we're replacing equipment, we make major improvements, as one example, and I can give you many others that are comparable, as an example of a store that we actually transferred initially about two and a half years ago. And it was a new store opened up on the same parking lot. Just down the road, you know, a big brand new laundromat, right. There was a bank building I bought it wasn't part of the center but it still shared the parking lot. And it clobbered the owners that were there people that I dealt with for several years and stuff and they ended up closing the store and they sold another guy took it over theirs it was a funny story, but he ended up taking it over and reopened it and cleaned it up and he replaced a bunch of equipment with better used equipment and things like this. So at any rate, but it had a big nut, you know the the rent was eight grand or so going up from there, and And here he is doing 17 half of his money's going to the ramp. So anyway, that's it so he reopened it and then listening Laundry came in after that. And he had gotten up to about 20 to 23,000 fell down to 17 when the new Islander and he said Uncle, and I was able to pick it up for one of my clients, because we that's how we work. We work through our clients on these issues. And we had one that was had had the, the faith in us and the faith in himself to pull this off. So we bought that store very cheap. And there were things that we discovered that were very beneficial to the buyer through that course, as far as the way the store was set up and, and costs were going out, things like that, that made immediate improvements. And then we changed them operations of the store, the equipment was still working. But we knew it was done and and we're going to need to replace it. So we replaced right away, replaced it and added a couple of big machines. And he went back up to about 23 grand right away back to where that other store was in his heyday before the new stories when opened up. So we knew we were okay, so we went and retooled it and put in new equipment, and he bought, the dryers are still okay, so we put in about $200,000. So he's into the same for about 350. Now. So we went ahead, and we told him, we built the numbers up to 40 and up above $40,000, over a year and a half of different types of things that we do when we move a store forward. There's a lot of strategies in place, because we're competing against people who are charging very little for the wash and stuff. And things that what we do is create that community environment that people want makes more people come in, can we use strategic marketing and address for the issues and diverse communities in our intelligence about our Marketing. And today, that door is well past 50 We just shortly, not too long ago, we added a 135 pound washer, which are 15 loads of watch. And it's turning more than any other machine in that store. And we're going to add another one. Okay, so I mean, this is huge. So this guy, this guy by the store, and was fully expecting to make 20% hoping to do better. Okay. Well, I mean, where is he now? You know, I mean, not to mention with the stores worse. But here's the issue that goes back to that lease issue. If you don't have a long term lease, he has nothing to sell. The landlord owns that store. Right? You can't you know, if you don't, you can't sell something with 15 years and under in this business, and offer a sustainable path that allows you to sell the store.

Ed Mysogland  
Let's that's good point. Well, the funny the funny thing that we keep on hearing, as well, let me ask you, you had mentioned about the community tell me what you mean by that. I mean, I look at a laundry around, like, what kind of community is a lot? You know, do you go to laundromat for community?

Chuck Post  
Oh, you know, I'll tell you what, if you if you have handy a cell phone, you can go on Google Maps and look it up a corner wash San Diego, California. And take a look at that thing. And I have pictures i The story is in my book I could even send it to yet. Because I have it as a separate sheet. When we create stores that look like that, and have a sanitizer system, and it is fully staffed, things move flow, there's entertainment, they're full of their TV and music, there's a nice lobby, people can get over a one section, there's a there's a Wi Fi table, they can sit there and work, or they can eat a snack or they can even fold clothes that they're there we have places where people can go and get away from others to be by themselves. We have places where people can commune you know, a community laundromat reaches out and it's involved in the community of sponsors, sports teams, and organizations and has programs to support and, and and, and move out the homeless situation from the store and face graffiti and operates it like a real business. You know, we are looking for entrepreneurial investors that want to go that next level. And when we do that, see, here's the thing, only 10% of the general population are there about us a coin laundry. You know, I that may surprise you. That's really it should be much higher.

Ed Mysogland  
It's okay. It does.

Chuck Post  
But when your feet stick to the floor and it sticks in there. Yeah. Yeah. When will your feet stick to the organization or you don't know that's it?

Ed Mysogland  
Well, the funny thing is, when you when we start talking about that, you know, I I think there's a pre pre condition or you know that a lot of laundromats are just that it's it's in the low income communities and it's it's serving that purpose and, and I'm not certain that, that that's what we're talking about here. I mean, I'm assuming there's different law levels of laundromat yes or no?

Chuck Post  
Oh, I mean, it would take us three hours to discuss them all it really was there are so many different, there are different communities that you're in and different problems, their destination stores, their stores that are in shopping centers are rolling out a lot, each of them have different challenges and different opportunities to capitalize on. The problem is we don't have and we are gaining these people and your listeners are probably selling them because they're interested enough to learn things. But but the fact is, people buy a laundry, then they find out that it's not all that they've got to reinvest in it. So they're struggling to keep it running, they're not looking at the big picture, they're focusing on getting by from day to day, you go in there and talking to them, say you look, what you need to do is invest $300,000, in new equipment, they just chase you away. So they stay there and they try, you know, fixing it, putting band aids on things that are drastically broken on, maybe they'll paint it up nicely. But to get it nice looking in there, they might even throw some staff at it. But staff by itself won't increase your income right away. And there's a lot of carry costs and changing the model. If they don't start with a strategy during the acquisition, then typically they lose out on going forward. In fact, I tell people, I hear all the time Chuck, I listened to all your good ideas, we're going to implement them, we'll get in touch with you, after about six months of operating store, see how we're doing. I know I'll never hear from them again to us, I call out to see if you're ready to sell it. You know, I mean, that's just the facts of the thing. So if you don't, if you don't complete the the acquisition, which includes revamping the store, because you're never, almost never going to buy a store, that sustainably run in good condition. Okay, for any kind of a price it's ever gonna carry you out forward without them awfully good ideas to do it with. So we do, we're always looking for that done store, we can buy them cheap, and put three or $400,000 on and they're doing 10 or $15,000. Now, I mean, we're buying the stores as low as 60,050 60,000. And then putting in this kind of money and turning him into stores that are netting eight and 10 and $12,000 a month. Okay, that's where the money's at, in this business and smart people. And then you can stack those, you know, when you get one you can, you can leverage it for the down payment on the next one. So people who are gold minded, have that capability in this. Our business focuses on the entrepreneurial investor who wants to take on this business and really maximize it. We're not We're not supportive of the franchise, we're supportive of the individual community business. You know, franchises are great, and there are some dabbling in our business they have I've worked with some in the past. But they all forget one thing is that each market area is so different. And the laundry is such a part of the community that needs it. The idea is to to gain. That's where our base model comes from, is that necessity of life business. Altogether. We are necessity of life community service business, that is our real place in the world. Okay.

Ed Mysogland  
Yeah, yeah. And that's really interesting. Because, yeah, I think there's, we see so many of these buyers that just believe that, hey, this is a cash type business that I can shelter, shelter income, and it's not the it's not the sexy entrepreneurship, business that people you know, like a manufacturing company, I produce widgets. So I guess, to two things there one, I mean, it seems as though the business has has has evolved, and the whole cash, the, you know, the hiding of income is gone has gone away, because so many people are using using cards now. That's my first question. And the second is, is why why do you think the businesses is so sexy for, you know, for for people? I mean, what what's the what's the attraction, because this is a such a huge investment, and a lot in it. And it takes a while to recover that investment, you know?

Chuck Post  
Well, I'll tell you what your first your first topic was, what your first question was, what again, the

Ed Mysogland  
first question had to do had to do with with, with how revenue is recognized, whether it's cash, or I guess, there's always people that are that are, you know, sheltering cash, you know, and it's hard to buy a business When, when it's when you, when you don't have that, that type of accounting that you can rely on, you know that somebody's ripping, you know, stealing from the business, and I'm certain you see it all the time, we don't

Chuck Post  
worry about it, quite honestly, we know how to figure out how much they're making do any use analysis, and which, which, by the way, a lot of brokers and sellers and stuff to add over works, it can be tricked anyway, you know, it's not true, it can be tricked. But if it's not, right, there's a reason for it, water doesn't just evaporate in the line, you know, so we're able to figure out the income based on an analysis that includes collections and a process that we have, we actually have a, an acquisition kit that includes the due diligence, and we, we help them go through it, you know, the offer that online to anybody, and then we work closely with people who go on with our service programs, but basically, so you can determine now about that, you know, it's true, a lot of people always felt that they didn't need to report it, you have so many write offs and stuff, you know, you report your income. You know, I mean, seriously, you have depreciation, I know of so many cases, back in the old days, when I was doing like, this bad find the guy who, who accelerated all this depreciation and everything like that, and then sold his business and had a ton of recapture tax. You know, I mean, it's just, you know, there's a logic to the way you do things. But that's, that's up to the individual. And you're right, it is getting more difficult. But that's not the advantage, I mean, the advantages, to make it easy. So we do we have several different tape paste systems on a single machine today, we have the coin is a hybrid system, which we highly recommend keeping, still probably will for the next decade, we also have in the newer machines, or the companies have put into their programming, a pay system, the Touch system, okay? Because you sign up, you're on an app, and then you can utilize it right from that. And if you can use your credit card or ATM, that sort of thing from there. Then we also have a third party system, that's an attachment that people can slide your cards in which we find people prefer rather than that computerized application system where they have to bring up their phone. So but so we make it very easy to use the machines. It's like Ray Kroc did the hamburger, you know, and that's been a big issue with us for a long, long time. Is that Is it the pace systems were crummy? And now we're talking about putting 30 and 40 quarters in a machine? It's even a burden, right? So yeah, and now. So. So in an inner result, you know, it is a little bit easier to get accurate readings, although not entirely, we still do the water analysis anyway, because it tells us a lot of different things about the terrain levels and other things that we, we like to know. And a lot of that is in the programming, and a lot of it is is just allowing you to be hands on discovering things. You know, it's one thing to look at a program sheet and say, oh, okay, everything's fine. It's another thing to walk through the machines, seeing what's out of order at the time and all that. So we, we are big on due diligence, because it's critical. And we expect the machines to be at a very late stage, and most cases, which we can, we can easily discover the age of the machine. And when they're older, they also are less efficient, which means that a lot of the benefit will be in lower utility costs. And sometimes we can drop the price, the cost of utilities by 3040, all the way up to 50%. And even more, depending on the circumstances and the equipment being used, which is huge, because overall, that's about 10% of the gross, you know, the water and sewer costs. So all these things matter. So we're analyzing the store not so much for what it's doing. We want to verify that the guy was doing that much because he should challenge the price if he didn't, right. That's easy for us to do. That's so easy. I can't even tell you what we're looking for. It's a path forward. What do we have? What kind of a lease is it? What do we have to get out of it? All those things, and then we create them we established the framework for a new laundry investment for the new investor. We do it every time without fail. If the store was three years old, we would do it, it doesn't matter. Okay, we have to prepare it because very few laundries are set up for true success by the investor. They're set up for success by the developer and the landlord.

Ed Mysogland  
Okay, so but if I'm a buyer and and this is my, this is my first one, and I'm trying to figure out what is the best way to go about buying it. And and if I'm the seller, this is what I should anticipate from any normal buyer. So what's my process? Take me through how how I how as a seller, I should be working with the buyer. And you know from this, these To the these are the areas of value you I think you've already talked about the equipment, you've talked about the community, are there any other value drivers as a seller that I should be amplifying, in talking with the buyer? And as the buyer, if I'm, as I'm looking at this, you've already talked about the lease, you've already talked about the quality and condition of the equipment. How am I How am I marrying those two together? Does that make sense?

Chuck Post  
Well, we we provide service to sellers who want to be owners who at some point time want to sell sometimes right away, you know, very frequently, sometimes they are willing to prepare themselves for a good transaction, you know, and if they are, then we would do is encourage them to get that lease negotiated. So that some incentivise broker, or the buyer doesn't go in there and piss off your landlord and everything else and make it more even more difficult for the next guy. So the most important thing is to pair the store so that you have a saleable product to sell with with an exit strategy for that buyer. If you can do that, you're going to be able to sell it easier, faster, with a lot less people falling off, you know. And so the other thing, we have, what we call model basis report that identifies all of the challenges of the store itself, the equipment condition and stuff like that, when we work for a seller, we, we bring out that report, create it for him just as we would for a buyer to fill out if he's if he's challenging a sale. So by the seller doing that, we're looking at the deficiencies, and then he has a choice to either correct them, or acknowledge them. So there are no questions. You know, the worst thing is these deals fall apart, brokers selling stores 234 times sometimes to get a sale of a stick, you know, because it's not ready. Is that is that the job of a broker, it shouldn't be to restore that the broker should sell something that's ready to sell. Okay, we are our first we, our services do that, that restoration for people, if they're prepared to sell it, and then they put it on the market, you know, they should be able to list it at pretty much full value, and expect the buyer to come back with some discovery issues, maybe related to the age of the equipment and things like that, to further down the price. But the fact is, is in our business, a store with old equipment can still sell at high, high value, honestly, if it's sustainable for a farm for a few years, at least. And and the benefits of retooling are greater as a for instance, if the buying is 20%. The return on the added work is more like 35%. So we're now we're looking at a 26 to 30% valuation, or return on the total project. That's what we're looking for. And then of course, once you get all the work done and put into your brand, and you've got your policies and procedures and staff in place, you've got to go to person you can count on, you know, my son in law, Chris, for 12 years has been going to his laundry wants to twice a week period to collect his money. And now he put it in a different pay system. So it only has to go once a week. So he always stops him twice when he has to go to San Diego for our work. How easy is it? All right, you've got cameras, you've got employees you have. Okay, that's the attraction. But if you make it sexy, if you if you, you know, you don't want that 10% That's base level, any wonder you clean and open and machines are running should do that. And that's the way we feel that we screw it all the time. But we want is that 30% That 25 and 30% that we're entitled to we do that by offering fluff and full service attendance on duty, really the right atmosphere when they're their programs that cater to the individual types of people, if you're in a shopping center, having a drop in shop system where people can put their clothes in the washer, leave, come back and you move them over to the dryer while they're gone. So they keep their products going right you free up your machines. You know, you put some programs like this in you find what people appreciate and emphasize it. The fluff and fold is wonderful. And pickup and delivery is getting huge now. And we're seeing stores that were only doing 10,000 $12,000 A month in self service now doing $20,000 Also, with pickup and delivery and fluff and fold. Huge is huge opportunity and and it's how sexy you make it that's gonna make you win. And how well you cater to the specific community.

Ed Mysogland  
So yeah, and which begs the question, so how are the people you're working with are how prepared are they? I mean, are you saying like, this is like deer in the headlights? Oh my gosh, this is what I've got to do to make this thing sale ready? Or are they like yeah, like I could see that

Chuck Post  
consultant in my business as has been through an entire generation, a store where he's built a ritual with new equipment and watched it go from that original owner. about seven or eight years, he sold somebody else who wasn't maybe as prepared and discovers that in a couple years that the equipment had it and decides to sell it now. Okay, so now your average you're not fake keeping it eight years anymore, right? You're now you're keeping it a total of 12. Cut in half. Now it's a six year lifespan, right? So now you're looking for somebody that doesn't know otherwise, you're never gonna get what you're you've got into it back. So you're waiting for that person come along, that believes the equipment lasts forever, and then a 15 year lease is okay. And you sell it to him for that 60 multiplier. And it doesn't take him long to find out, he made a mistake. Now he's now at this stage, the equipment starting to fall apart. And he's hurt. He's probably looking for another buyer right now. Okay. So at some point in time, when I enter that, that store again, you know, it's usually not with my original buyer, because I'm not going to be able to get him the price that he's looking for. I'm too real. Okay, so. So they usually go through a couple of experiences. At some point in time when I reenter it, I usually reenter it with a buyer who I know, because I know the condition of the store and the problems that the seller is having. And I have a buyer that's ready to take it on do it right. You know, I mean, I've set everybody up with a path whether or not they take it as always their choice. But but the so in this situation, this story is actually in my book, it was real nice firemen, and his wife who were retiring. And they lived on a boat near the Marina that was close to this lottery, so everything was perfect for them. And I told him that, you know, the problem was, he said, he had all small machines in there, and there was a ton of apartments and they all had small, cheap machines that were cheaper, you know, you're not going to bring people in with that they need big machines to put their comforters in their blankets and do a whole bunch of loads. So he said, okay, and that was one of the guys, okay, I will get back to you, we're gonna, we're gonna paint it, we're gonna do this, we're gonna do that didn't need paint, but he put a nice mirror on the wall. And so that didn't help the business. And he raised his prices a quarter, you know. So in the end, after doing all that work, his gross sales came out about level to where they were before. But of course, he was saving a little utility money, but he lost customers in the process to balance that. And that's not the idea. You know, when we go in, we make moves. And we, we actually increase prices and increase participation by consumers together. Okay, we grow see together all the time. So but without any planning. So now, of course, he's mad at me, you know, I mean, I sold him to stand laundry, and it's no good. And so I listed it for him. And another guy comes along. And he loved the laundry. And he thought it would just be fine. He was comfortable with the revenue. And he wasn't, he wasn't gonna do anything to it. He just bought a cash flow. He has relatives at all, when his wife told him he has to get one. So doesn't take him long after the next renting grace and a loss of business because he didn't take care of it as good as the firemen did. Then, then he's he he's ready to go out to and then finally, we bring in one of our clients, who's another laundry owner not that far away. Who comes in and buys it does everything right. And he won't sell that thing here. I'll try here right now. That's a winner all the way through. It always was it was just a winner waiting to happen. And that's so true with so many laundries, but if you don't know how to identify him, if you don't know how to restructure everything, you know, you might just bite off more than you ever wanted to. And that happens. So what I'm trying to say is that, at some point, I have had what makes consultant is in the end, you have a couple, really having struggles amongst themselves. It's affected their family, the wife is crying on your shoulder, if not, maybe the husband is too. And there's just one out, you know, they just made a mistake, and they just want one out. And when you do that, and when you get them out of that hole the best you can and when you sell it to somebody else that makes it right, you deserve to be a consultant. That no sooner, amen.

Ed Mysogland  
So what are the structures that you're seeing?

Chuck Post  
We find that that is, oh, well, you know, yeah, we have good industry financing. We have to, because, quite frankly, the books look lousy. In most cases, banks don't want to touch this, we're just there's too many variables for them to get involved in they, they got burned back in late 2000s. You know, so that's, that's so our industry financing requires 35 to 40% down and they'll finance the retooling and the equipment. Most of our fees they're not the deal making costs but the the all the model designs and everything it takes to create that new model and and they work of a wishing the laundry owner community very well because we know the needs so you're not paying doesn't you're operating for a full month before you have Loan service costs, and do a fact and a lot of other things. They're very good. And then, of course, we also have we have, we have a couple of independents, one that we work very closely with have for 30 years now. And then the factories also have lending opportunities if you're buying their equipment, so, but we usually start getting people approved by the independent lender, and then and then we kind of through discussion, find out what the what their needs are. Because if you don't marry the owner to the laundry, if he's driving 50 miles to get there, and he's only met netting five grand, he's not going to like it very long. You know, I mean, you've got to, you've got to kind of look at the parameters, he's not willing to operate with staff, then you need to know that with it stores that are sustainable without it or with minimal staff. So we have to know him first. Or her?

Ed Mysogland  
Yeah. Well, so as relates to the financing, I mean, is it competitive? I mean, where's, you know, we're at prime at 8%. Right now, we're Where does financing land for you guys?

Chuck Post  
Well, right now, we're running pretty close to 10, nine, three quarters in town. Historically, 9% was normal, you know, it's just been, you know, since the collapse and stuff, everything changed and how we all expect lower interest. You know, the fact is, is that, you know, it's really a crapshoot to rely on that, because it changes things so much from one level to the other. But, you know, the loans are refinance, double, you know, with with simple terms, pretty much, they offer a lot of different kinds of incentives, things, sometimes we can marry in some seller financing. But, you know, since lenders started loaning on lotteries, seller financing has become, you know, rare, actually even rare, because they don't need to and, and it used to be, you know, and of course, you know, back in the old days, everything was so simple. The machines were simple. The transactions were simple. Landlords, I'd have ESCO send him the assignment papers with an extension. You know, sometimes I remember back in the old days, escrow even close to sales before we got the actual signed documents back from the landlord, because it was they were so confident from it from their discussion. Let me tell you something, negotiating leases is a whole different world right now. I'm sure you know that. Oh,

Ed Mysogland  
yes, I do it. And it's, and it's a it's, it's an interesting time to be doing deals. But But again, I these types of businesses, I think you're this isn't going anywhere, ever. It's gone through the roof, you know,

Chuck Post  
it fits into the lifestyle people today so much. Yeah, that people want. Yeah, see, they don't go out as much as they used to. Okay, which also helps promote the pickup and delivery services, and this was a thing, but at the same time, you know, they have the money people can afford laundry today pretty easily, you know, to do a week's worth of laundry, for an individual is running around 11 $12 a week, it's not much more than it is at home, really, if you if you were paying your utilities and everything else and having to buy a machine. So it's not that you know, what drives me and there's also a fact that people do want to get out and, and be around other people, but they want to do it in a safe environment. So which leads to the whole theme of laundry today, when we cater to the people on the population, we bring in new customers. So that's why that little store that came in on the same property, did not lose a lot of business, they probably took a 10 15% hit at worst when we first started going after the market. But we were bringing customers from everywhere and a lot of them out of the homes. And that's what we need to do in this business. Bring them out of the home. Make them smell good.

Ed Mysogland  
Yeah. Well, I'd say I do think that this industry, this is about saving time, and anytime you're sick, you're able to save time, it's gonna be a winner. Yeah, you know. So we're bumping up on time. And I, I always ask, you know, of all of our guests, you know, what's the one piece of advice that you would give to, to laundry mat owners that would have the most immediate impact on their business if they go to sell?

Chuck Post  
I, we, we stayed in the book on our web. We do webinars every week, by the way, on Wednesdays at noon, Pacific Standard Time. And, and they we aren't nationwide, by the way. So we we always tell people don't go out and start searching for a laundry. Go look at laundries, you know, see what you like about them and don't like and then go to the next laundry that they're competing with and see what's better about that. Get to know this business, attend some webinars, you know, buy the book, by all means it's going to tell you exactly what you need to know. My clients that sign up for us which we do have a lot of clients working with us They use that book and they refer to it at different stages when we're talking to do dealing with different issues. This is This is no game business. This is not the investment of laundries is serious stuff in a serious money, and we make people rich. Okay? My objective is not to make people rich as it is to make the community a dang good laundry and a real happy investor at whatever level he chooses to be. But there's no question. We're teaching people how to be wealthy and our stacking systems and things like this. You know, people, it's very common for people to own their second third laundry in just a couple of years. Just we have a young lady that started with almost no money, we got her into a laundry, she really did everything right, that we told her to do. And, and she got the funding for the new equipment and stuff. And she ran it so well and address that community. So well, she drove the prices up, and another laundry came on the market. That was all rundown, we took that over for her and she was able to leverage her store with only a year in, okay to buy that other store. And he's just got finished being retold. And it's beautiful. It's called the magic Swan in Pasadena, California, if anybody wants to look at the online, no Google, map pictures and stuff, the beautiful store and boys, it's gonna cook, it's just getting started now. And it's already at and above where the base level was. So that's what we do is we we build the base, and then we build beyond the base thing. So

Ed Mysogland  
I get it. Well, the book is called the laundromat, the American dream business and an entrepreneurs playground. So Chuck, what I know we're going to have all of this in the show notes as far as connecting with you. Your your domain, or your website is PBI laundry.com. Right? Webinars are on Wednesday, and you'll get

Chuck Post  
good. I'm sorry, I think that's

Ed Mysogland  
No, no, no, it was a, it was a cut out on me. So the I just want to make sure that we know where to find you.

Chuck Post  
Well, yes, P bi. Like it stands for post business investments, which was my name when I first got into brokerage. But it's PDI laundry.com. And our webinars are on Wednesdays at noon Pacific Standard Time. And, and it's free, you can register at our website for that. And while you're there, I've got some videos to look at, we've got a lot of articles and stuff you can surf through. And just just a whole and we also have a menu of services that you can look at that explains what we do. It's a little you know, there aren't a lot of people doing things the way we do I have 38 years in this business. And I'm doing the things the way I believe they should be done for the benefit of the the industry and the investors in it. And I'm making it out. You know, and we do a good work because I'm, we're dealing with leases, we bring the industry to the landlord, not incentivize broker, we talked to that landlord is listen, we're the laundry industry. And these are the requirements to have a laundry that's going to prosper. And if he doesn't go along with it, he's gonna end up with something that's gonna drive home was there, you know, so we make sure that they so it's just everything that we do is different than what you're gonna find in most places. I don't know of anybody else that operates in the same manner, quite frankly. But I think you'll enjoy the experience many do. We leave good projects behind and teach you good information. And we look forward to working with each and every one of you.

Ed Mysogland  
Well, Chuck, thank you so much for your time. It truly it I did not. I didn't I bet I didn't know 60% of what you just said. I mean, I had I had a pre pre preconceived notion on how these things work it just what I've seen in the area, but I can totally see the what you're trying to build and those businesses that those laundromats that thrive aren't necessarily the ones that people assume you know, so thanks so much for for being on and helping

Chuck Post  
and remember, everybody washes their clothes or pay somebody else to do it.