Can this laundromat support its costs and financing?

Build sales from paid wash cycles and dryer minutes

Wash sales equal machines by size × paid turns per machine per day × actual calendar days × vend price. The assumed mature unseasonal wash receipts are $608.80 per day before refunds. There is no income from merely owning unused machines. The first six active-month ramp factors run from 45.0% to 95.0% of mature demand, then reach the full modeled level. Mild month-of-year demand factors repeat; these are assumptions rather than measured local seasonality.

Dryer attachment applies to washed dry-weight pounds, not one dryer sale per washer sale. Average load fill, dryer-pocket fill and 30 paid minutes determine billable minutes. Larger washers can split their output across multiple pockets. Net revenue deducts the 0.5% refund allowance from all vend receipts. Prices rise 2.0% at each forecast-year boundary; paid demand has no assumed long-run growth after ramp. The comparison price page explains an observed price ladder elsewhere but provides no local demand forecast.

Read profit, debt and cash as different measures

Contribution deducts usage-related water, gas, electricity, payment fees, cleaning supplies and routine maintenance from net vend revenue. EBITDA then deducts fixed rent, paid roster, fixed utility charge and other operating budgets. Owner compensation is included before EBITDA. Depreciation and debt interest reduce net income; loan principal and capital improvements reduce cash without being current operating expenses. Borrowing proceeds at opening are funding, not sales.

Utilities are computed from gallons, heated-water share and temperature lift, paid dryer minutes, full-fire input × assumed duty, and electric consumption. Nameplate ratings support equipment design inputs; modeled duty and metered tariffs remain assumptions. Water/sewer costs escalate 11.0% annually as a risk proxy informed by the OCU notice, while energy escalates 5.0% and wages/rent/fixed budgets 3.0%. The annualized January escalation is not a literal utility billing schedule.

Negative net income persists in this base case because depreciation of a large installed fleet and financing interest exceed EBITDA, even when later cash changes become positive. Cash and profit can therefore point in different directions without an arithmetic error. The model carries losses against a simplified entity-level tax proxy; it is not a tax return or an estimate of the owner’s personal after-tax income.

What changes—and which case needs more funding

Downside assumes demand at 70.0% of base, all vend prices at 95.0%, variable utility tariffs at 120.0% of base, installed CAPEX at 110.0% and a two-month opening delay. Debt rate rises by two percentage points. Payroll, rent, baseline electricity and debt start in forecast month one, including the delay. It is a coherent stress case rather than the sum of unrelated low estimates.

Upside assumes paid demand at 125.0% of base and prices at 105.0% of base, with the same equipment, staffed hours and base utility rates. Physical and peak-window constraints are checked before recognizing sales. No claim is made that more demand requires no change in actual security, cleaning or service workload; validate that workload before adopting the upside.

Define recovery without counting opening cash twice

Equity recovery compares cumulative after-tax cash changes after principal, working-capital changes and capital improvements with opening owner equity of $210,630. It excludes the reserve itself, wages already expensed, new borrowing, terminal sale proceeds and deposit refunds from the recovery stream. Base and downside do not recover equity within 60 months. Upside first recovers it in 41.0 months. This is a modeled cash-accumulation diagnostic; there are no assumed distributions to the owner.

Unlevered project recovery uses cumulative EBITDA less modeled income tax, working-capital movements and later CAPEX against opening uses excluding cash reserve. This separate measure reaches its basis only in the upside at 54.0 months. It is not interchangeable with accounting break-even, Year 1 debt coverage or the day the bank balance first stops falling.

The base minimum bank balance is $38,586. It ties to an opening $60,000 reserve and explicit card/utility timing, not a generic runway formula. A larger reserve improves liquidity, never EBITDA. The independent check reruns that perturbation and the collection-delay test.

Owner wages are compensation; retained cash is still company cash

The owner is paid for 20 hours each week at $30.00 per hour: $2,600 gross wages in a forecast month, plus assumed employer-equivalent burden. Together with 35 attendant hours/week at $18.00, loaded monthly payroll is $5,970. The current Florida non-tipped minimum is $15.00; the case rates are chosen budgets, not verified hiring offers.

The 55 combined paid hours do not staff all 98 weekly opening hours. The format assumes a partly attended operation, with paid owner response/admin time, monitoring and clear customer help arrangements. If the premises, insurer or operating policy needs fuller attendance, cost that coverage. Cutting owner pay to show profit would conceal replacement labor rather than improve the underlying operation.

No discretionary owner distributions or personal taxes are modeled. A cash balance above the reserve is not automatically withdrawable while utility payables, maintenance, lender restrictions and future capital work remain. The completed monthly income, cash-flow and balance-sheet CSVs should travel together into the owner’s later plan generation.

Compare the monthly cash path

Download all scenario cash values (CSV). This educational case export is separate from the planned personalized Excel model.