Enter the yearly revenue ($) and the yearly costs ($) into the Calculator. The calculator will evaluate the Laundromat Value.

## Laundromat Value Formula

LV = (YR - YC)*2.5

Variables:

- LV is the Laundromat Value ($)
- YR is the yearly revenue ($)
- YC is the yearly costs ($)

To calculate Laundromat Value, subtract the yearly costs from the yearly revenue, then multiply by 2.5, which is the typical multiple for a laundromat.

## How to Calculate Laundromat Value?

The following steps outline how to calculate the Laundromat Value.

- First, determine the yearly revenue ($).
- Next, determine the yearly costs ($).
- Next, gather the formula from above = LV = (YR – YC)*2.5.
- Finally, calculate the Laundromat Value.
- After inserting the variables and calculating the result, check your answer with the calculator above.

**Example Problem : **

Use the following variables as an example problem to test your knowledge.

yearly revenue ($) = 50000

yearly costs ($) = 20000

## FAQs

**What factors can affect the yearly revenue of a laundromat?**

Several factors can impact the yearly revenue of a laundromat, including its location, the number and type of machines available, pricing strategy, operating hours, and additional services offered such as dry cleaning or folding services.

**How can a laundromat owner reduce yearly costs?**

Laundromat owners can reduce yearly costs by investing in energy-efficient machines, implementing a preventive maintenance program to avoid costly repairs, negotiating better rates with utility providers, and using technology to manage operations more efficiently.

**Why is the multiple used in the Laundromat Value formula 2.5?**

The multiple of 2.5 is typically used in the laundromat industry as a standard valuation metric based on average industry profitability and risk. It reflects the expected return on investment for a laundromat based on its earnings before interest, taxes, depreciation, and amortization (EBITDA).

**Can the Laundromat Value formula be used for other types of businesses?**

While the Laundromat Value formula is specifically designed for evaluating laundromats, the basic principle of subtracting yearly costs from yearly revenue and applying a multiple can be adapted for other types of businesses. However, the specific multiple used may vary significantly depending on the industry, market conditions, and the business’s profitability.