Commercial Laundry Services Company Serving Healthcare and Hospitality

This article presents a strategic acquisition framework for a niche commercial laundry and linen services business specializing in B2B clients such as surgical centers, urgent care clinics, dental offices, boutique hotels, short-term rentals, and luxury spas. The company operates as a centralized wash-and-fold and delivery service, offering bundled cleaning, sanitization, pickup/drop-off, and linen rental. With growing regulatory emphasis on hygiene and sterilization, the company’s healthcare segment has experienced steady growth, bolstered by multi-year contracts and infection control protocols.

The business generates $4.7 million in annual revenue and $975,000 in adjusted EBITDA. Approximately 78% of revenue is recurring under weekly or bi-weekly contracts, while the remainder is one-off linen rental or emergency/overflow wash services. The company owns and operates a 12,000 sq ft facility with industrial-grade washers, dryers, ironers, and packaging stations, and runs four daily delivery routes across a 75-mile radius.

This business is a strong SBA 7(a) acquisition candidate due to its recurring revenue, route-based model, physical asset value, and defendable service infrastructure. A buyer can scale operations through route densification, regional expansion, vertical specialization (e.g., expanding into vet clinics or wellness centers), and acquiring mom-and-pop laundry operators with outdated facilities.

Proposed SBA 7(a) Deal Structure

The company’s cash flow, asset base, and contractual revenue base make it ideal for a standard SBA 7(a) structure:

• Purchase Price: $3.9 million (4.0x EBITDA)

• SBA Loan: $2.925 million (75%)

• Buyer Equity Injection: $390,000 (10%)

• Seller Financing (Subordinated): $585,000 (15%) amortized over 6 years with 12-month interest-only

Protective deal terms:

1. 20% clawback on seller note if recurring contract revenue falls >10% in 6 months

2. Seller earns $50K performance bonus if buyer adds $400K in new recurring accounts within 12 months

3. Seller to remain as operations advisor and route optimization consultant for 6 months post-close

Customer Segmentation and Revenue Composition

Client mix:

• Surgical centers and outpatient clinics: 28%

• Dental practices: 17%

• Boutique hotels and STR operators: 16%

• Day spas and wellness centers: 14%

• Medical labs and pathology centers: 12%

• Physical therapy and sports medicine clinics: 9%

• Assisted living homes: 4%

Revenue breakdown:

• Recurring wash/dry/fold pickup & delivery: $3.65M

• Emergency/overflow washing services: $420K

• Linen rental and replacement: $370K

• Infection control and certification logs: $180K

• On-site facility backup (temporary): $80K

Contracts span 12 to 36 months, auto-renewable, with performance SLAs for turnaround time, packaging, delivery windows, and infection control standards. Services include tagged linen tracking, sealed packaging, and certified antimicrobial treatment for healthcare clients.

Top 40 clients account for 71% of revenue. No single customer exceeds 7.2%.

Facility, Equipment, and CapEx Readiness

Facility:

• 12,000 sq ft owned facility zoned for light industrial use

  • Wash room with 6 commercial front-load washers (60–100 lb capacity)

  • Dry room with 6 matching commercial dryers

  • Ironing and folding station

  • Packaging and tagging station

  • Climate-controlled storage for linen rentals

  • Maintenance bay and parts storage

Current capacity utilization: ~68% (room for 30–35% growth before new equipment needed)

Fleet:

• 4 delivery vans with route management tablets and GPS tracking

• FMV: ~$210,000

• All maintained in-house, inspected quarterly

CapEx needs:

• Add 1 high-speed ironing and folding line for labor reduction: $58K

• Upgrade route dispatch software: $9K

• Replace one 2016 van within 12 months: $35K

Labor, Training, and Operational Model

Staffing:

• 7 plant staff (washers, folders, pressers)

• 4 full-time drivers

• 2 route schedulers and customer service reps

• 1 facility manager (non-owner)

• 1 part-time infection control officer (RN certification)

All staff trained in OSHA and EPA linen protocols. Healthcare client linens processed in color-coded isolation batches with sterilization logs retained for 3 years. Drivers are cross-trained for customer service, pickups, and field issue escalation.

Post-close talent strategy:

1. Create retention bonuses for plant staff tied to SLA and margin performance

2. Offer CDL upgrade path to senior drivers

3. Recruit a healthcare sales specialist to grow clinic vertical

Sales and Growth Channels

Sales sources:

• Referrals from healthcare consultants and medical device reps

• Google Ads and SEO for “clinic linen service + [city]”

• Trade shows and local business events for hospitality

• Cold calling and field sales in medical business parks

Annual marketing spend: ~$35,000

Growth strategies:

1. Acquire competitors with low-tech plants and outdated sterilization capacity

2. Launch a luxury STR laundry concierge service with premium pricing

3. Add linen leasing packages to increase contract stickiness

4. Expand into veterinary and grooming clinics with separate processing

5. Push infection control compliance certification as a bundled upsell

Financial Summary

• Revenue: $4.7M

• COGS (labor, utilities, detergent, vehicle): $2.2M

• Gross Profit: $2.5M

• SG&A: $1.525M

• Adjusted EBITDA: $975K (20.7%)

Margins by line:

• Recurring clinic laundry: 55–60%

• Linen rental: 65–70%

• Emergency/overflow jobs: 70%

• Compliance certifications: 80%+

Receivables are healthy, with 80% on monthly billing cycles and 15% on prepaid contracts. Emergency jobs are paid net-7. Clinics often use practice management systems with billing integrations.

Licensing, Insurance, and Risk Mitigation

• Licensed commercial laundry operator under state code

• EPA and OSHA compliance logs available for each quarter

• Fully insured: $2M GL, $1M auto, $1M workers comp, $1M umbrella

• Infection control procedures validated by RN with logs for clients

No open insurance claims or safety violations. All delivery staff trained in safe handling, PPE, and linen segregation.

Working Capital and Transition Budget

• Payroll float: $95K–$110K

• CapEx and equipment upgrade: $100K

• Seller consulting and licensing continuity: $35K

• Healthcare rep hiring and onboarding: $20K

• Marketing blitz for vet clinics and luxury STRs: $15K

Ideal Buyer Profiles

• Route-based operators (shredding, janitorial, waste)

• Facility services aggregators seeking recurring healthcare exposure

• SBA-qualified individuals with process or operations background

• PE-backed laundry consolidation platforms

Post-Close Execution Plan

1. Meet with top 30 clients and deliver continuity packets

2. Audit linen inventory and re-price underperforming accounts

3. Launch outreach to surgical centers and long-term care facilities

4. Identify two acquisition targets under $1.5M revenue in adjacent counties

5. Deploy new dispatch system and track per-route profitability

Conclusion

This commercial laundry and linen service business offers recurring, compliance driven revenue in a niche market with strong barriers to entry. Its healthcare orientation, skilled workforce, and facility infrastructure make it attractive for SBA 7(a) financing and scalable growth. With minimal churn, untapped capacity, and multiple adjacent verticals to penetrate, the business presents a stable yet flexible platform for an acquirer looking to grow in the B2B services ecosystem. Whether the buyer focuses on healthcare, hospitality, or acquisition roll-ups, the company provides a clean and consistent pathway to scale.