Do hotel and restaurant linen accounts at a dry cleaner stay after a sale?
They may, but those accounts usually depend on service, price and relationships rather than the ownership. Ask for each account’s history, pickup schedule, any written terms and the contact who makes decisions. Then ask whether the customer can leave on short notice. Meet the biggest ones before you commit.
Commercial linen work is different from walk-in trade. Volumes are steady, schedules are tight and a missed delivery can disrupt a kitchen or a hotel floor. Ask how each account is served, how reliably, and what happens when the plant is behind. A good record of on-time delivery is a stronger sign than a friendly owner.
Request any written agreements and read them with your lawyer, paying attention to termination and assignment. Some accounts run on habit alone. In both cases, ask the seller who at the customer makes the decision and how long they have worked together. Personal friendships between owners and buyers of service can fade after a sale.
Look at the money too. Check how quickly each account pays, whether any balances are overdue and what share of income comes from the largest few. A plant dependent on two or three customers carries a different risk than one with many. If the seller agrees, introduce yourself to the main contacts before closing, and plan a visit soon after. Keep pricing and schedules steady while they get to know you. Ask what would cause a hotel to move its linen elsewhere, because the seller usually knows the answer well.
Key takeaways
- Review each account’s service record, schedule, terms and who decides at the customer.
- Have your lawyer read any agreement for termination and transfer wording.
- Check payment speed and how concentrated the income is.
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Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
- 02Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 03Business Development Bank of CanadaGovernmentAfter buying a business, what is the next step?
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