CHICAGO — After the past two years, it would be easy for the laundry industry to have a negative attitude about business.
The pandemic, inflation, labor issues and more have made staying in business, let alone growing, challenging.
However, respondents to the most recent American Laundry News Your Views survey have upbeat attitudes about the current state of their business and the future, for the most part.
When asked “How was your laundry business in revenue in 2021 compared to 2020?” 35.5% indicate “Way up in revenue.” More than 32% are “somewhat up in revenue,” and 12.9% are “the same.”
Just over 16% are “somewhat down in revenue” while just 3.2% are “way down in revenue.”
Of those respondents who took the survey, the top two factors for improved sales were an increase in customer base and increased prices (both selected by 20% of survey takers).
These were followed by offering more services or profit centers (15%), decreased competition and increased marketing (both 12.5%), and decreased costs/expenses (2.5%).
Other reasons for improved sales were:
- Demand for product increased.
- Increase in volumes from existing customers.
- Less COVID concerns.
- Loosening of COVID restrictions on indoor dining and event gatherings.
- Restaurants were allowed to open,
- Revenue is up from 2020, but still down from 2019. We’ve still yet to hit volume like 2018, and into 2019.
- We were forced to hold customers to the charges for what they had on inventory, plus all additional items previously allowed.
When asked “If your sales haven’t improved since this time last year, what do you blame it on?” answers include:
- Public panic, government restrictions, labor crisis, inflated minimum wage …
- Our decision to focus more on retention and profit than growth and new revenue.
- Both Federal and State leadership choking business and growth with needless mandates.
- Less occupancy.
- Businesses not reopening back again.
- Flat on health linens.
- Access restrictions to locations and supply issues.
- Inflation.
- We have a healthcare facility laundry. We don’t have sales but we do view our users as customers. Unfortunately, our customers have increased, not good news for the community. Harder for the facility to keep up with the demand when labor shortages seem to be the norm.
When asked what has affected laundry businesses the most over the past two years, labor issues were the top vote-getter from 34.4% of respondents followed by pandemic health policies (28.1%). Supply-chain issues came in third with 18.8%
Only 9.4% of survey takers indicate that inflation has affected their business
Survey takers provided the following answers when asked about the best thing that happened to their business in 2021:
- Businesses started opening back up and began doubling orders in efforts to keep customers safe.
- New leadership.
- We stayed open for the whole year and none of my employees were sick.
- We were able to take on new business before the labor crisis hit. Hope we can maintain it.
- Employee Retention Tax Credit.
- Forced us to focus our business activities in the areas which were most profitable. Also re-evaluated the many SKUs (colors and sizes) of event linens and reduced them dramatically based on performance over the past five years.
- We invited priced-based and/or unprofitable business to find another service.
- Continuous growth.
- Most of the employees caught covid at some point so now a good portion of our workforce has immunity.
- Increase in group business.
- Competition closing.
- The training we were able to do in 2020 aided us in growing our business in 2021. We did not lay anyone off in 2019 or 2020 we intensified our training efforts to prepare for when the economy and sanity came back to our governments.
- Unexpected increased revenues.
- Utilizing all the offered help between the ERTC, EIDL and state grants.
- Learned quickly to adapt to new scenarios and accommodate customers.
- Government stopped paying people to stay home. Our recruitment is finally showing some slight improvement.
- Had two huge mills team up with me.
- Streamlined operations/improved labor efficiencies.
For 2022, almost 65% of respondents are confident that their business will keep improving. Just over 25.8% think it will remain the same, and just under 10% are worried about decline.
When asked why the survey takers responded as they when asked about 2022, a manager worried about decline wrote, “Inflated consumables, minimum wages and being competitive. Might not be able to afford to stay open.”
Comments from those who expect their business to stay the same include:
- Wages are increasing for my customers, so it should be good.
- We’ve offset some of the costs with much higher prices, and expect new business to offset customers closing due to economic climate.
- The training and work we did with our sales force and personnel is showing the dividends we expected ... and we expect that to continue.
- I don’t see COVID-19 or its variants going away. I think we are going to have to learn to adjust and live with it.
Finally, the reasons for respondents to be optimistic include:
- Businesses are open and operating at mass scale due to changes in the way they operate due to the pandemic.
- New leadership and owners.
- Additional services being offered to customers means more work for us. Labor shortages starting to normalize.
- I firmly believe that there will be a much closer return to “normal” than the small taste the authorities gave us in 2021.
- Renewed focus on true KPIs in all departments. Awareness and accountability factor has increased; management team is committed and driving the improvements. Bonuses engineered on improvements more than growth.
- Tons of opportunity, and labor availability is improving.
- We have a fantastic sales team that consistently outperforms itself every year.
- We did a total rebuild on a location that was closed for a few years. We provide the best service in the area and our customer base keeps growing.
- We are continuing to see increased numbers every month. Our projections show we will be more profitable by EOY. Between marketing efforts and continued changes in societal needs, we expect to see continued growth.
- Looking like virus starting to slow down and more customers open to visiting locations and traveling.
- Doing more marketing.
- We get daily calls for new business and are focusing our sales efforts in particular areas where we know there are growth opportunities.
“I think expanding services and being more open about what is offered so customers know is helpful,” a respondent writes. “I think being confident in staying on track with the changing times is important!”
While the Your Views survey presents a snapshot of readers’ viewpoints at a particular moment, it should not be considered scientific. Due to rounding, percentages may not add up to 100%.
Subscribers to American Laundry News e-mails are invited to take the industry survey anonymously online each quarter. All managers and administrators of institutional/OPL, cooperative, commercial and industrial laundries are encouraged to participate, as a greater number of responses will help to better define operator opinions and identify industry trends.
Have a question or comment? E-mail our editor Matt Poe at [email protected].