RIPON, Wis. — Some business owners and facility managers are considering outsourcing their laundry operations in hopes of reducing expenses. It is important to gather all the information up front and weigh the pros and cons carefully before making any decision.
Dilemmas such as this are becoming more prevalent every day. Many business owners and facility managers are charged with finding ways to reduce operating expenses and increase efficiency for the greater good of their business. But unless you have all the information available, your decision could wind up producing a negative impact instead of a positive.
HOW DO THE COSTS DIFFER?
If you’re considering the switch from on-premise laundry (OPL) to a linen service, it’s important to learn what makes up the laundry dollar so you know where your expenses come from.
According to OPL managers surveyed by UniMac, a manufacturer of OPL equipment, the main costs of running an on-premise laundry come from labor, which makes up 45-55% of the total cost, followed by linen replacement at 13-25% and equipment at 8-12%. The remaining costs are incurred through chemicals, utilities and maintenance.
The main costs incurred when paying for a linen service include company overhead, with functions including marketing, sales, delivery trucks and gas, administration, and management. Of those costs, 31.5% is included in your payment.
It can be difficult to imagine a comparison between the cost of operating an on-premise laundry and the monthly service fee from a linen service. However, by analyzing the cost of equipment and accounting for labor, utility costs, expected lifetime maintenance and chemical costs, it is possible to calculate the expected operational costs.
On average, to launder a pound of soiled linen on the premises costs approximately 31 cents, according to several OPL distributors and UniMac research. While it is true that a linen service can leverage economies of scale to actually process the linen for less per pound, the average linen service charges approximately 48 cents per pound to service and supply the facility’s linen, according to distributors and UniMac.
The 17-cent-per-pound savings is significant. For example, if your business launders 1,200 pounds of linen a day, the average total cost for on-site laundry for a year is $135,845, while a linen service for the same period would cost, on average, $209,664, a difference of $73,819.
When your laundry is on-site, managers have complete control over everything being laundered for guest use. As a manager, you are in control of what type of laundry chemicals are used, how loads are sorted, and which washing and drying cycles will be used.
Additionally, you are in control of the type of linens that are being used at your facility, meaning you pick the brand, thread count and color. Luxury linens are becoming increasing popular, and because of the high-end material used, specific washing and drying instructions will need to be followed.
On-premise laundering allows managers to have that type of quality control over processing.
Linen services typically work out of a pool of linens that their customers rent. When your business returns linens, those items are put in the wash with other businesses’ linens in order to achieve the maximum efficiency. You can choose to separate the linen your business uses from others’ linen, but your costs will go up from the previously mentioned figures.
If your laundry is on-site, it’s critical to take a look at how you can continue to improve the costs associated with the operation. Equipment can positively impact the largest expense of the laundry dollar—labor.
When selecting washer-extractors for your operation, it’s important to look for machines that conserve utility costs and cut down on the time spent cleaning linen.
Washer-extractors with high G-force extraction speeds remove more water from linens, which leads to decreased drying times. For example, a machine spinning at 100 G-force extracts less water during the final spin than a washer extracting at 300 G. Higher extraction reduces the amount of moisture left in the linens by up to 47% and also decreases drying times and gas usage by as much as 35%.
Another feature to look for is spray rinse, which uses less water than a traditional bath wash. It also cleans linen more quickly and efficiently than a standard machine.
The last feature to look for in washer-extractors is the number of fill valves a machine uses. A washer-extractor that has four fill valves helps maximize efficiency. It can trim up to four minutes off the fill time.
A timesaving feature available on dryers is Over-dry Prevention Technology. This technology shuts a dryer off when the load has reached a precise level of dryness.
In a survey of commercial laundry distributors and laundry managers, 79% believe on-premise laundries over-dry by more than eight minutes per cycle. If this practice were eliminated, annual savings could be as much as $883 in utilities and nearly $5,000 in labor. Also, the linens experience 31% less fiber loss when over-drying is eliminated, which extends linen life and reduces replacement costs.
Advanced equipment controls are available to help managers regulate their staff. They help to keep the laundry running efficiently, while reducing the costs associated with keeping linens on-site.
Newer controls offer quality reports that give managers access to date-and-time stamps for machine activities, including each cycle’s start and end times. Too much time between cycles indicates staff inefficiency. With this type of information, management can take necessary steps to improve employee productivity.
To further improve efficiency, control options such as “head start” can help cut several hours of labor expenses per week. Machines can be preloaded and programmed to start ahead of employees’ start time so when the employees arrive for work, the first wash load is complete and ready to move into the dryer. This allows for an extra load of laundry to be processed each day.
Workers should be performing at full capacity, as should your machines, but employees sometimes under-load the machines, leading to wasted utilities and chemicals. Advanced controls provide information when this happens. These reports help managers determine whether better training or smaller machines is needed.
When considering a change in how your business processes its laundry, you must look at the long-term savings. By contacting your local laundry distributor, you can gain insight into the benefits of maintaining an on-site laundry and get all the facts about what additional options are available. A distributor will be able to provide an actual assessment of your operation and pinpoint where improvements in efficiencies may need to be made.