Queens Dry Cleaner - $500K SDE Garment Care

$1.0M

Revenue

$500K

SDE

1.7x

Multiple

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Full Editorial Writeup

This is a Queens, NY dry cleaner doing about $1M in annual gross sales with roughly $500K in seller's discretionary earnings, a 50 percent SDE margin that is exceptional for the category. The business runs a full menu of garment care services including dry cleaning, tailoring, alterations, wash and fold, and related work. It leans on a loyal repeat customer base in a dense, high-income metro market, and the listing emphasizes the location is prime within Queens.

The economics here are the headline. A 1.7x multiple on $500K SDE is cheap on its face, and the 50 percent margin on $1M revenue signals either a tightly run plant, a high-mix of high-margin alterations and tailoring, or some owner add-backs worth scrutinizing. Rent is disclosed at $9,500 per month, which is roughly $114K per year, a material fixed cost in any garment care model and the single most important lease term to validate.

The seller cites "other business interests" as the reason for sale rather than distress or retirement, and the business is described as fully staffed with growth paths through expanded marketing, pickup and delivery, and commercial accounts. For an operator who can manage a small staffed plant in a dense borough, this is a boring, cash-generative service business at an attractive entry multiple.

Why we like it

Earnings quality is the standout. A 50 percent SDE margin on $1M revenue is roughly double the typical dry cleaner benchmark, which means either operational discipline or favorable service mix toward high-margin tailoring and alterations. That margin must be stress-tested but if real, it throws off $500K against an $850K ask.
The 1.7x SDE multiple is well below the 2.5x to 3.5x typical for staffed service businesses with this cash flow. Even after a normal working capital and capex reserve, the payback period on equity is short, and there is real downside protection if revenue softens because the entry price is already conservative.
Garment care is genuinely recession-resilient. People still need work clothes cleaned, suits altered, and uniforms maintained through downturns, and a loyal repeat base in a dense Queens market provides predictable recurring volume that does not evaporate when discretionary spending tightens.
The growth levers are real and unexploited. Pickup and delivery plus commercial accounts (restaurants, medical offices, hotels) are the highest-margin expansion paths in this category, and the listing explicitly notes they have not been pushed. An operator with basic route logistics and B2B sales can layer revenue onto an already-staffed plant.

How to improve it

Launch a pickup and delivery service within 90 days using existing staff and a single route vehicle. This converts a fixed-location business into one that can capture customers across a wider radius without adding a second plant, and it raises average ticket because convenience buyers are less price-sensitive.
Pursue commercial garment accounts aggressively. Target nearby restaurants, salons, medical and dental offices, and small hotels for recurring uniform and linen contracts, which smooth revenue and reduce dependence on walk-in retail traffic.
Audit and optimize the service mix toward tailoring and alterations. These are the highest-margin lines in any cleaner, and a small price and capacity reallocation toward custom work can lift the blended margin while using the same labor base.
Build a simple loyalty and reactivation program. Most cleaners run zero CRM, so even basic text reminders, prepaid cleaning credits, and lapsed-customer win-back offers can lift repeat frequency and lifetime value with near-zero incremental cost.
Negotiate or extend the lease before close. At $9,500 a month, the lease is the largest controllable cost and the biggest valuation risk; lock in a long-term, assignable lease with capped escalators to protect the SDE base and make the business financeable.
Implement modern POS and online ordering. Card-on-file billing, scheduled pickups, and digital receipts reduce friction, capture data for marketing, and professionalize the customer experience in a category where most competitors still run on paper tickets.
Document standard operating procedures and cross-train staff. Reducing key-person risk on the plant floor protects continuity and makes a future second-location roll-up or a clean exit far more achievable.

Diligence notes

Verify the $500K SDE with three years of tax returns and a full add-back schedule. A 50 percent margin is far above category norms, so confirm what is being added back to the owner, whether the owner currently works in the business, and whether replacement labor or management cost has been accounted for.
Scrutinize the lease in detail. With rent at $9,500 per month and real estate not included, confirm the remaining term, renewal options, escalation clauses, assignability, and whether the location is genuinely prime; a short or non-transferable lease materially undermines the valuation.
Inspect the plant equipment and environmental exposure. Dry cleaning machines, boilers, and the historical use of perc or hydrocarbon solvents carry replacement capex and potential environmental liability; get an equipment age and condition report and confirm compliance with NY environmental regulations.
Validate the customer base and revenue mix. Quantify the split between walk-in retail, alterations, wash and fold, and any commercial accounts, and confirm concentration; understand how much revenue depends on the current location's foot traffic versus genuinely loyal repeat customers.
Confirm the real reason for sale and staffing stability. The seller cites "other business interests," so verify there is no looming competition, lease problem, or staff departure, and confirm the fully-staffed claim with payroll records and tenure of key plant employees.

Source

Originally listed on BizBuySell. View original listing →