Hah, same here!! My business is in a rural area. If I give a quote to an old white farmer type dude I will inflate my estimate a bit, because I expect him to waggle his eyebrows and ask me “what if a pay ca$h?” Then I can come down a bit. He thinks I’m pocketing the cash without paying taxes, in reality I’m not bright enough to do that and get away with it. It’s easier (for me) to just do things honestly.
It’s also a lot easier to get financing from the bank for expansions and things.
The convenience store in my office building only started allowing credit cards to be used a few months ago because of Covid. No one was carrying cash anymore (dirty, dirty bills).
I surmised they were cash only for so long to avoid paying the cut to credit card companies and to avoid taxes.
A front business could operate as cash only. I’ve been to restaurants that only took cash. They have an ATM machine customers could use if they didn’t have cash on them. I don’t think they were fronts because the food was usually good and the places were packed, but a criminal could do the same thing with a scam restaurant. That way 100% of their receipts are cash and there would be no comparison between cash/CC payment ratios to compare with similar businesses.
My favorite brunch place in Chicago is cash only. The owner is almost always there. I think she does cash in this case to avoid credit card fees although I would not be surprised if she was less than honest about the income on her taxes too (just a guess). Unfortunately, the nearest ATM is a block away and it is one of those third party kind that charge an outrageous fee so best to plan ahead and get cash at your bank ATM.
Also, the famous Chicago bar, The Green Mill, is cash only (or was…been a while since I have been there). If any place is a front for crime it is that place. Used to be a speakeasy. (It may be totally legit…I don’t know.) Love that place.
The median price per square foot is about $250, up about $20 from just a few months ago.
Strip Clubs always have an ATM on site. If so I am told. 
And yet my property value never seems to budge. Not going down but not up either. Somehow these massive property bubbles totally avoid me.
We frequent a small Italian restaurant run by the owner, an older Italian woman with jet black hair and a foul mouth. Her place is cash only. Probably 95% of her business is from regulars who know how she runs things. I’ve been there twice when someone joked about the cash only thing, asking her if she paid taxes. Each time her reply was a loud rant, “I’m a good USA American, so FUCK YOU and your accusations, get out of here you MOTHERFUCKER!!!”
She’s a sweet lady until she gets angry.
I’d be willing to bet she is cheating on her taxes. 
Her sauce is so good, she gets a pass on not paying if she isn’t. 
I feel a duty to pay my share of taxes.
I feel no such obligation towards credit card companies.
Tons of restaurants and food trucks in LA are cash-only. I doubt any of the ones I frequent are money-laundering schemes, because they’re too damn good at their “front” business. As @k9bfriender pointed out upthread, your room to play is in the difference between how much your business could earn if running at full capacity, and how much it really does earn. You can’t launder much money through a burrito truck that already has customers lined up every day from open to close.
Food trucks seem like a great possibility for a front business. There’s no fixed location for the feds to investigate. It seems like you wouldn’t even really have to operate the trucks. You might have to get the appropriate permits to allow roadside vending, but then after that it seems like you could just park them in the garage. Order the supplies but just throw them away. The same with the street food carts. Get permits for 10 carts but only actually operate 4. No one is going to notice that the 6 carts with the highest profit aren’t actually on the street selling to customers.
Is there any reason why it can’t be both things? An actual successful business would be an even better vehicle for laundering money than than the always empty store front.
You want a happy medium. A totally empty business that somehow continues operating is suspicious. But if you have a booming legitimate business, why risk it with illicit activity? Either just run your legit business, or atheist split it off so it isn’t at-risk due to your crimes.
There are a lot of businesses which are just barely profitable. Restaurants and bars are often like that. A successful restaurant has to carefully ensure that their prices and costs are within certain ranges. Price too low and you won’t make a profit. Price too high and your customers will leave. There is a small sweet spot where you will be profitable. A few unexpected expenses may be the difference between success and failure. So in that environment, throwing in a few thousand dollars here and there may be the key to ensuring the business is profitable. With the addition of sketchy cash, the restaurant no longer has to be run perfectly to stay in business. It just needs the prices and quality to be such that it has the veneer of a legitimate business to cover for the infusion of drug money.
In one of the videos posted above they noted that Pablo Escobar (drug kingpin) ran the most profitable taxi company in the world. There were only three actual taxis but they reported income in the millions of dollars.
If someone bothered to check the scheme would be busted but, of course, he paid off government agents so they never checked.
Hey, that’s three more taxis than are owned by the current most profitable taxi company in the world.
Back in the 80’s a guy we knew was nabbed in a drug trafficking scheme. He drove a fast boat smuggling pot and was caught and along with a dozen others of his conspirators put in prison. Their payout for the scheme was estimated at 30 million USD, which they stashed in the UK and then “cleaned it” by purchasing various properties in Florida and elsewhere.
He served his time, no more than 3 years iirc.
Today he is fabulously wealthy, rumors abound about the money that was never recovered in the sting.