Outsourced laundry costs set to rise due to wage and utility inflation
Updated: Nov 18, 2021
The Textile Services Association recently carried out a wage survey of the commercial laundry sector and found that labour costs have surged by a massive 14.25% in the last twelve months. Over 86% of the trade body's membership participated in the research, and the results are a stark reminder of the pressing challenges that the industry is currently experiencing.
TSA CEO David Stevens warns that without significant price increases the industry is simply not viable. "Wages are the tip of the iceberg," he says. "We have reports of energy prices going up 300%, insurance up 100%, textile costs up 50%. It's not sustainable. The industry was already reeling from the aftermath of the lockdowns and lack of government support, but these increases are unprecedented. We've jumped out of the frying pan and into the fire."
This perfect storm of cost pressures has a knock-on effect for accommodation providers within the hospitality and care sectors. For example, customers have reported difficulties getting rooms ready for guests because they don't have enough clean bedclothes. In addition, they have been forced to look at paper solutions to replace their typical table linen, such as the Airlaid Swansoft napkins by Swantex (sold at Bunzl) or Alliance’s own brand.
Adam Hickingbotham, Beacon Head of GNFR and Services, advises, 'In these difficult circumstances, some companies will have little choice other than prioritising their customers based on their commercial value to the business. Therefore, smaller companies, or those with higher costs to serve, may start seeing their service levels drop.”
If you usually have an excellent relationship with your linen supplier, the TSA has provided advice on temporary actions you can take to support your laundry provider:
Talk to your laundry provider to consider how to manage the situation and temporarily reduce your linen requirements, for example, by encouraging multi-night stays, reviewing bed change policy, and reducing linen required for your dining room and/or restaurant
Send back any unused stock.
Keep the laundry informed of upstream occupancy levels.
Give plenty of notice for events and F&B requirements, such as weddings.
Understand that some laundries may have cash flow issues, so prompt payment of bills may help.
If you have tried all the above and are still consistently experiencing poor service levels, get in touch with Beacon now. Although these issues are sector-wide, there may be a more appropriate solution that we can identify.
Even if you are still in contract, it still may be worth speaking to us, as we have seen evidence that firms are being far more flexible in allowing customers to exit their agreement if they are having difficulties servicing the account due to geography or non-standard requirements. However, it’s paramount that these discussions begin immediately to ensure that you have a greater chance of securing a more reliable level of service before the Easter peak season. Furthermore, although rising costs in this sector appear inevitable - please be assured that Beacon are working hard on your behalf to ensure that any requested price adjustments are justified and that wherever possible the percentage increase for our customers is below that of the general market.