Manage Linen Misuse, Loss—Save Money (Conclusion)

Textiles: Steve Kallenbach, ADI American Dawn, Los Angeles, Calif.

When we think of inventory control, we typically picture the cage around the storeroom that prohibits entrance to unauthorized personnel. The days of simply making sure the cage is locked (and considering that to be sufficient inventory control) are long gone. Merchandise and inventory control involves so much more.

It has to be centered on quality product, efficient production management, fiscal responsibility and meeting the expectations for quality of the customer. The umbrella of proper merchandise control includes every facet—from the plant to the customer and back again. In other words, it involves choosing the right textile to buy, keeping your textiles rentable and getting your textiles back.

All too often, acquisition cost is the only consideration when purchasing textiles. There are many more factors that should be involved in this process. Make sure you include processing costs of a particular textile, as well as value of scrap/ragouts. Additionally, you should recognize your audience for proper textile decisions.

One of the most forgotten considerations when choosing a different textile is the possible difference versus current market standards. Is the packaging different? Would that slow down or decrease/improve productivity? Is the labeling different? Would that have an effect on customer requirements? Is the weight/color/fabric truly the same and how would it affect your situation? What is the value or use of the scrap/ragout? What is the life cycle, and how does that impact true “cost”?

Price: Simply put, you should consider more than acquisition costs. Price has many factors. In other words, a certain product “price” could be twice that of another. Yet, if the life cycle
is double, the true cost could actually be lower.

Placement: One of the most common negative effects on linen is using a great textile in the wrong application. It won’t take long to see that using a yellow shirt in a diesel garage will ensure that you won’t have a long-lasting, rentable uniform.

Process: We all know the negative effects that even the simplest error can cause to our textiles. Avoiding those mistakes is paramount, but being able to recognize the negative effects is just as important. Knowing how to identify issues that range from redeposition to bleach damage to excessive pilling will help you maximize your time, profits and textile life.

You should work with your chemical company and your textile provider on a troubleshooting guide that will help point you in the right direction at a moment’s notice. While the chemistry of a formula can be perfect for a textile, machine or operator malfunction can cause devastating impacts.

Proper merchandise/inventory control means somebody has to take charge and be accountable—a job that won’t be easy. Most importantly, this person needs to know that their job is not a popularity contest, as it’s based on establishing “command and control.” Internal control includes all of the following:

• Security — Keep your inventory secure. Limit access to approved personnel. Post your policy document for all to see. Take it seriously.
• Product Flow Control & Reconciliation — Create and use merchandise flow forms. Nothing leaves without the approval document, and that applies to all associates and managers.
• Internal Training — Make sure all employees know the rules of your internal control process. Create a document for orientation explaining the rules. If necessary, terminate when theft is discovered—no exceptions. Do consistent re-training at regular production meetings.
• Offer “Employee Purchase” — For example, charge employees cost plus 10%. Give people good reason to be honest.
• Plant Monitoring — Use cameras, or at least imply that they are in use.
• Injection Management — Injections should be limited to specific days/times and should be monitored and adjusted carefully.
• Inventory Your Goods — At a minimum, inventory should take place semi-annually. More often if results are poor/unfavorable. Less often if results are good/favorable. You may have a linen “black hole” that regular inventory can/will help you discover.
• Route Controls — Production works hard to get the product ready for delivery. Make sure your routes and managers are taking due care of products after they take custody, especially with regard to quality presentation. Also, make sure you are using load sheets.
• Customer Controls — Work with your customers to make sure they are treating your products as intended. Take inventories at the customer site. Massive inventory costs can be hidden in “out-of-control” delivery management.
• Route Audits — Should be unannounced, random and regularly done. Pre-audit outgoing, count incoming soil, count clean return and balance versus the initial load sheet to find any missing goods.
• Customer Audits — Same rules apply. Many quality auditors have paid for themselves from the savings created from their efforts. This isn’t about “policing” customers but rather providing intended inventories.
• Route Contests & Amnesty Programs — Give your team the opportunity to account for inventory inaccuracies. Offer full commission or other incentives to balance inventory to the invoice. In other words, simply charge for everything that is being delivered. Make it a contest. Involve the entire team in the winnings. Post the results. This can be also be one of the most profitable organic growth contests a company can have. After all, it’s really about getting the money for goods already delivered. There is no real cost in the end, because you are already paying for it.
• Sample Orders — Create and use a “no-charge” invoice policy. Samples are part of the cost of doing business—but should always be documented. This will also allow for proper follow-up on the potential sale.

Implementation may seem daunting, depending on your current level of controls already in place. We strive to be good, not necessarily perfect. And the entire merchandise control process does not necessarily need to be implemented all at once. Start with the “low-hanging fruit.” Most of these recommendations aren’t pretty much common sense, just a revisitation of what we probably know is “right.”

Uniforms/Workwear Manufacturing: Carl Rocco, Uniform Advantage, Plantation, Fla.

I am reminded of my father-in-law, who spent 42 years in our industry as a plant manager and finally VP of purchasing for National Linen Services, retiring in 1993. As you can imagine, many a Sunday dinner was dedicated to this very topic, and the question is just as pertinent today as it was 20-plus years ago. While we had many a lively discussion, he and I came to no firm conclusions at that time.

I recently read that, in the healthcare industry alone, linen loss is exceeding $840 million annually with nearly 90% of linen products not reaching its useful life. Staggering data indeed. For years, the question has been geared toward not eliminating loss, but rather making it more manageable. With these numbers, any tangible improvements would be noticeable and helpful to budgets across the country.

The contributors to all of this are incidental loss, theft and damage to the textiles, which can include everything from chemical issues to mechanical and procedural.

There are stabilizing variables that can be suitably controlled with a keen eye toward improving:

1. Having stock levels that are high enough to support the business, but not at the total expense of the budget.
2. At time of purchase, quality of piece goods and construction.
3. Regular equipment maintenance.
4. Employee and end-user training.
5. Security of goods.

One of the first thoughts that I have often discussed is to make sure that stock is solid, and par levels are enough to satisfy the critical needs of the patient or guest. First and foremost, the satisfaction level of our end-user must be met, or exceeded. By having appropriate stock, one can also assume that each piece will be processed less frequently, thus extending the overall life of the product.

Today’s fabrics have higher levels of technology, including moisture-wicking, mechanical stretch, odor-control and anti-microbial characteristics. They may also include a higher level of polyester that can assist with a faster drying time, strong color retention and user comfort. However, one must weigh the additional upfront purchase costs with the expected life cycle of the garment. Is there a cause/effect issue with more comfortable fabrics actually lending themselves to potential loss?

Laundry machinery has traditionally been in service for an extended period of time, and maintaining equipment via regular operational efficiencies is key to this long life cycle. However, it can also assist with preservation of textiles. Everything from hospital laundry chutes tearing items to ensuring the chemical balance is appropriate to maintain tensile strength help maintain textiles for a longer period of time. Remember, the higher the temperature, the more frequently items are washed, chemical harshness—all cause fabric degradation and will reduce in-service time.

To chip or not to chip? As technology surrounding RFID chips increases and simplifies, is this a good method to track goods through the system and thus reduce overall loss by providing checks and balances within the laundry as well as locations being serviced? As this technology evolves and the chips continue to last longer and provide data, I think utilization will increase.

As it was nearly 30 years ago when I began my career, I firmly believe that this topic will continue as we struggle with the critical requirements of patient satisfaction and thus client satisfaction versus the critical budgetary and profitability needs of our own business.

A strong partnership with vital suppliers, from equipment to chemicals to linens and uniforms, built from understanding your critical needs and then providing consulting solutions, will assist in the process. Each industry contains a variety of subject matter experts to draw from as you work through the balance of customer care and profitability.

Miss Part 1? Click here to read what representatives from the chemicals supply, consulting services and equipment manufacturing markets had to say.

Have a question or comment? E-mail our editor Matt Poe at [email protected].