Opening A Laundry Shop In Pattaya, Preferably In Jomtien

[yongli]

Hi Everybody,

I want to invest in a Laundry Shop in Pattaya, preferably in Jomtien.

Why?

I have a Thai friend, who likes to do it and has done it before. For personal reasons (failed love), she had to stop.

We want to rent a shop house, where she can live and have the laundry business on the ground floor. (business and living quarters could also be seperate, if that helps to cut the costs) She would run the business, I

would not get involved too much. I will run the numbers, before we start, and follow them up, when the business is running. I would consider my investment successful, if the shop is sustainable, can support her and her children and brings in a modest return (At least enough, to grow the business). I don't plan on living of the proceeds :-)

1. How much rent would I pay in a decent, but definitely not A- location for a shop house?

Is 10 K Baht a month doable?

2. How about Key Money? How much would I have to pay? Can I avoid it altogether for this kind of business? Ideas on how to minimize it?

3. How to best structure the lease and the lease duration, as to avoid sudden surprises in terms of rental hikes, or the owner booting us out, when we are successful?

4. I personally like Jomtien, but am also open to other locations in Pattaya, or even in a completely different place. Any ideas?

Also, if you have other advice, especially related to the laundry business, I would be very grateful to hear it.

As far as I am concerned, yes, I am prepared to lose my investment (and will limit it), but I would like to give it as big of a chance as possible.

Therefore, I would much rather leave as much survival cash for the business as possible, than give it upfront to the land lord.

It certainly will take time to get established and build customer loyalty, but the lady has a few good ideas and a very friendly personality. She has done it before and I have quite a bit of trust in her willingness to work hard to make it work. Now is low season (and a bad one), so it might be a good time to get favorable conditions.

Thank you very much for taking the time.

Edited August 2, 2009 by yongli

[yongli]

Hi,

It seems, the idea of a laundry business is getting everybody running for the exits ;-)

Anybody that has done a lease for a commercial property, and has some advices on this key money thing?

Any other help or input?

As far as lease duration goes, I am thinking of a 3 years lease, with a 3 years option on extending the lease and a limit on a possible rental increase. Any other ideas, i.e., how to get the land lord to agree?

Thanks in advance,

yongli

Edited August 3, 2009 by yongli

[rolypie]

Forget it!!!!

Money after bad, there are shops that have been running for years closing there are far too many doing it and worse still sleeping on the shop floor with no living quaters above etc and still canot pay the rent never mind make a small profit,

[yongli]

Forget it!!!!

Money after bad, there are shops that have been running for years closing there are far too many doing it and worse still sleeping on the shop floor with no living quaters above etc and still canot pay the rent never mind make a small profit,

Thank you rolypie for taking the time.

Serious question: May I know, how do you know, the reason for them closing was lack of customers (Could it be their lease expired?)? And if, could it be they weren't doing such a good job, so they depended too much on new business (versus return customers)?

I hope, by doing a good job and having prices in line, customer loyalty can be build in this kind of business (unlike an internet shop). I myself keep using the same shop, as long as the service is good and the clothes are clean.

I would also hop, a location where you can get residents as well as tourists can protect a bit against a downturn.

[Thongkorn]

heres an address of alady who may sell you hers ,

[email protected]

its in Pattaya clang. I think she is marrying her boyfriend and going to live in Swizerland

[charlie1968]

HI

I OPENED A LAUNDRY SHOP WITH MY THEN GIRLFRIEND IN BANGKOK

SHE NOW LIVES WITH ME IN THE UK

SHE FOUND A SHOP FOR 6000 BAHT A MONTH

NEAR A HOSPITAL WHICH SHE GOT QUIET A LOT OF CUSTOMERS

THERE WAS HER AND HER TWO SISTERS

SHE PAID THEM 4000 BAHT EACH

AND THEY ALL SLEPT IN THE SHOP AT NIGHT WHICH WAS HARSH BUT COULD NOT AFFORD RENT FOR A CONDO OR ROOM

MY WIFE USED TO START WORK AT 630 IN THE MORNING AND CLOSE AT 1000 AT NIGHT

SOME PEOPLE WOULD STILL KNOCK ON THE DOOR AND DROP THING OF AFTER IT WAS CLOSED

WHAT I MEAN IS SHE WORKED VERY HARD AND LONG HOURS FOR JUST ENOUGH TO PAY THE RENT AND TO EAT

AS THERE ARE LAUNDRY SHOPS EVERYWERE SO YOU HAVE TO PRICE VERY GOOD

[yongli]

Thanks for the tip Thongkorn.

Any idea about how much rent she pays?

yongli

[yongli]

HI

I OPENED A LAUNDRY SHOP WITH MY THEN GIRLFRIEND IN BANGKOK

SHE NOW LIVES WITH ME IN THE UK

SHE FOUND A SHOP FOR 6000 BAHT A MONTH

NEAR A HOSPITAL WHICH SHE GOT QUIET A LOT OF CUSTOMERS

THERE WAS HER AND HER TWO SISTERS

SHE PAID THEM 4000 BAHT EACH

AND THEY ALL SLEPT IN THE SHOP AT NIGHT WHICH WAS HARSH BUT COULD NOT AFFORD RENT FOR A CONDO OR ROOM

MY WIFE USED TO START WORK AT 630 IN THE MORNING AND CLOSE AT 1000 AT NIGHT

SOME PEOPLE WOULD STILL KNOCK ON THE DOOR AND DROP THING OF AFTER IT WAS CLOSED

WHAT I MEAN IS SHE WORKED VERY HARD AND LONG HOURS FOR JUST ENOUGH TO PAY THE RENT AND TO EAT

AS THERE ARE LAUNDRY SHOPS EVERYWERE SO YOU HAVE TO PRICE VERY GOOD

Thanks for your report Charlie. May I know about your pricing (i.e. 60 pieces 500 Baht, or per piece?) and who your target customers were?

[charlie1968]

YEAH HER CUSTOMERS WERE MAINLY FROM THE HOSPITAL

SO MAINLY THAIS

60 FOR 500 WAS ABOUT RIGHT

BUT THEY DONT JUST BRING 60 OF ANYTHING

MOST WOULD BRING ALL SHIRTS OR THINGS THAT TAKE A LONG TIME TO IRON

SO THEM 60 THINGS COULD TAKE ALL DAY WHICH IS NO GOOD BECAUSE THERE IS NO PROFIT

ALL I SAY IS ITS VERY HARD WORK FOR LITTLE MONEY

BUT THE THIAS DO NOT SEEM TO MIND AS LONG AS THEY GET SOMETHING

WE CLOSED IT DOWN WHEN SHE COME TO LIVE IN ENGLAND

AND WE SENT THE WASHING MACHINES AND STUFF TO HER PARENTS UP NORTH

SO THEY CAN USE THEM

[Frosty]

The reason that these laundries and many other businesses are closing is simple Mai mee Falong, mai mee satong! No tourists, No money! This is the 5th yr of slow tourism caused by tsunami, SARS, bird/swine flu, bad economy and all the bad publicity this country gets. This compiled with new visa laws,many full timers and long timers are leaving, and new tourists are not coming. If you count on just Thais for business then your price has to be low, and you have to survive the way Thais do. You need a good local clientele just to get by during low season, the tourist on season is where you make your net. After the way this country chases away Falong ,short time tourists and long time expats ,there is no Falong customers base only Thai and they have no money, because they can't make any without foreigners here spending it! A viscous cycle! A difficult time to keep a business going let alone start a new business! Save your money ,you're gonna' need it!

[BWPattaya]

The reason that these laundries and many other businesses are closing is simple Mai mee Falong, mai mee satong! No tourists, No money! This is the 5th yr of slow tourism caused by tsunami, SARS, bird/swine flu, bad economy and all the bad publicity this country gets. This compiled with new visa laws,many full timers and long timers are leaving, and new tourists are not coming. If you count on just Thais for business then your price has to be low, and you have to survive the way Thais do. You need a good local clientele just to get by during low season, the tourist on season is where you make your net. After the way this country chases away Falong ,short time tourists and long time expats ,there is no Falong customers base only Thai and they have no money, because they can't make any without foreigners here spending it! A viscous cycle! A difficult time to keep a business going let alone start a new business! Save your money ,you're gonna' need it!

Spot on! I have had mates here who went down the same road of opening a laundry. They were the ones who were cleaned out, not the clothes. No tourists means no customers for anyone. Save your money, find something original, especially if Thais haven't done it.

[sibeymai]

Do you get to keep the odd pair of panties ? Could be a lucrative business opportunity if you can export to Japan.

[raro]

YEAH HER CUSTOMERS WERE MAINLY FROM THE HOSPITAL

SO MAINLY THAIS

60 FOR 500 WAS ABOUT RIGHT

BUT THEY DONT JUST BRING 60 OF ANYTHING

MOST WOULD BRING ALL SHIRTS OR THINGS THAT TAKE A LONG TIME TO IRON

SO THEM 60 THINGS COULD TAKE ALL DAY WHICH IS NO GOOD BECAUSE THERE IS NO PROFIT

ALL I SAY IS ITS VERY HARD WORK FOR LITTLE MONEY

BUT THE THIAS DO NOT SEEM TO MIND AS LONG AS THEY GET SOMETHING

WE CLOSED IT DOWN WHEN SHE COME TO LIVE IN ENGLAND

AND WE SENT THE WASHING MACHINES AND STUFF TO HER PARENTS UP NORTH

SO THEY CAN USE THEM

is your caps lock jammed?

[charlie1968]

YEAH HER CUSTOMERS WERE MAINLY FROM THE HOSPITAL

SO MAINLY THAIS

60 FOR 500 WAS ABOUT RIGHT

BUT THEY DONT JUST BRING 60 OF ANYTHING

MOST WOULD BRING ALL SHIRTS OR THINGS THAT TAKE A LONG TIME TO IRON

SO THEM 60 THINGS COULD TAKE ALL DAY WHICH IS NO GOOD BECAUSE THERE IS NO PROFIT

ALL I SAY IS ITS VERY HARD WORK FOR LITTLE MONEY

BUT THE THIAS DO NOT SEEM TO MIND AS LONG AS THEY GET SOMETHING

WE CLOSED IT DOWN WHEN SHE COME TO LIVE IN ENGLAND

AND WE SENT THE WASHING MACHINES AND STUFF TO HER PARENTS UP NORTH

SO THEY CAN USE THEM

is your caps lock jammed?

yeah they were

[Nio]

Amigo read the whole post, there is no way a laundry can afford 30,000 a month in rent

Edited September 12, 2010 by sbk
deleted quoted post removed

[Nio]

Hi Everybody,

I want to invest in a Laundry Shop in Pattaya, preferably in Jomtien.

Why?

I have a Thai friend, who likes to do it and has done it before. For personal reasons (failed love), she had to stop.

We want to rent a shop house, where she can live and have the laundry business on the ground floor. (business and living quarters could also be seperate, if that helps to cut the costs) She would run the business, I

would not get involved too much. I will run the numbers, before we start, and follow them up, when the business is running. I would consider my investment successful, if the shop is sustainable, can support her and her children and brings in a modest return (At least enough, to grow the business). I don't plan on living of the proceeds :-)

1. How much rent would I pay in a decent, but definitely not A- location for a shop house?

Is 10 K Baht a month doable?

2. How about Key Money? How much would I have to pay? Can I avoid it altogether for this kind of business? Ideas on how to minimize it?

3. How to best structure the lease and the lease duration, as to avoid sudden surprises in terms of rental hikes, or the owner booting us out, when we are successful?

4. I personally like Jomtien, but am also open to other locations in Pattaya, or even in a completely different place. Any ideas?

Also, if you have other advice, especially related to the laundry business, I would be very grateful to hear it.

As far as I am concerned, yes, I am prepared to lose my investment (and will limit it), but I would like to give it as big of a chance as possible.

Therefore, I would much rather leave as much survival cash for the business as possible, than give it upfront to the land lord.

It certainly will take time to get established and build customer loyalty, but the lady has a few good ideas and a very friendly personality. She has done it before and I have quite a bit of trust in her willingness to work hard to make it work. Now is low season (and a bad one), so it might be a good time to get favorable conditions.

Thank you very much for taking the time.

Many Thais still wash their clothes by hand and continue to do this when the economy is bad

In your favor, you are probably paying rent for her already?

So renting a shop house that she can live in and double as a business is probably not a bad idea if the total monthly out lay for rent is close to what you are paying now.

Shop houses can be used for laundry, restaurants, beauty salon, nails, and a host of other small businesses depending on what is needed in that particular area

First you have to find a location, second you have to survey and see what is needed in that location. Thais with no transportation tend to stay very close to where they live and use business close to their residence

[JohnC]

In your home country you would first do your market research, i.e. location, potential customers = income, competitors, previous failed businesses in that location, overheads etc, these would then be incorporated in a business plan which would show you have done the research, have a budget including potential income, target audience etc etc so whilst you may think a laundry is only a small family business ALL of the above still apply and if done properly will answer many of your questions posed here.

[lioness]

If someone had 30 Mil, I doubt they would be looking at opening a laundry.

Edited September 12, 2010 by sbk
deleted quoted post removed

[torrenova]

Late to this but here's my take on it.

When I lived in View Talay 2, there ended up being 4 laundry places downstairs. Now the blocks had 17 floors and there were about 30 units per floor and the average condo was probably 2 units so there were about (17-1)*(30/2)=240 condos in the block.

Prices were no better than 60/70 pieces for Bt500 whereas in town you could get 100 pieces for Bt500. Sheets were 4 pieces I think and bed covers (duvets) were the standard Bt100 each. One laundry stood out and they went out at 60 pieces. Far more than I would have thought were paying on the per item menu but I guessed they did not know. They opened fairly early but they were closing too early for my liking, sometimes at 6/7pm. Turn around was usually 1 1/2 to 2 days. I used them.

I looked at the model fairly closely and played around with some of the numbers. One problem that came up in every scenario was the cost of the unit, be it rent or a return on the investment if bought. The longer time went on, the more the price of the units went up and they tried to follow the prices of the condos on the upper floors, yet they were unsuitable for living in really due to the location and noise. Eventually, if renting, the rent required was getting too expensive for the basic model and the purchase way too much. If you had bought cheaper, then you were ok but if you revalued the unit, then the ROI went into reverse.

Labour was also a problem. Competing out of hours meant two shifts and that did not work. It had to be one shift, though some would start late and finish late and others start early and finish early. You could not run say 16 hours with 2 x 8 hour shifts.

You are reliant on the weather and outside space more than you think. Drying is the problem. Restrictions on noise in the lease meant that you could not run 24/7 even if you wanted to. Again, you were paying rent for 24/7 but only being able to use about 12 hours a day.

Competing on price would just drive you under or cause "other" problems. Customer loyalty was high and incentives to move could easily be copied. Added value was hard to achieve I perceived and yet the idea, being so simple on the outside, attracted me.

Looking to other ideas, perhaps a better smell or conditioner came up. The relative extra cost was small. Using customer's own or specified detergents and conditioners is a problem as you wash more than one customer's laundry together. It can be done, but it requires either a premium price or the customer to manage the laundry themselves and bring you only a near washing machine full at a time.

Fixed price monthly servicing is another idea but people want more for less. Incorporating the duvet washing and towels and sheets was an area which could work as it was the cost of laundering these items which sometimes put people off doing it as often as they otherwise might. Pricing it up was a headache. The bonus was that your really large machine/s which I saw often underutilised could be put into action and thus, deliver a better return. Another service was a speedy return but late night put in and early delivery could only be done on an early morning start and even that may not be early enough to get them dry again.

Marketing to the individual condos was frowned upon and word would get back to the other laundries in no time, causing friction.

In the end I moved and so dropped the idea but I was never at a position where I could guarantee a return and then hope to grow it into greater profitability. I think it could be done but you have to really know the market and if you were the 3rd of 3 laundry units as you walk from the lift, you stand little chance of the average customer getting past the other two.