Are there substantial differences in equipment and procedures between a commercial or rental plant and an institution-based laundry? If so, what are they, and why do such differences exist?
Richard Warren, General Manager, Institutional Services Corp., Conway, Ark.:
Commercial plants rely on customers to supply their income. Generally, the linen that is washed is customer-owned goods, or COG. Rental plants operate in much the same manner financially, except the laundry company owns the goods.
In-house or on-premise laundries (OPL) are institutional laundries. The term “institutional laundry” is commonly stereotyped as one that caters to hospitals, but an institutional laundry may be a prison laundry or a laundry facility associated with a transitional care unit as well. The term is more of an economic one, rather than a description of the type of work that is processed.
Laundry equipment is pretty universal. A washer will wash whatever is put into it. An ironer doesn’t care where the work came from. But the categories of work, and the workload mix, can make the equipment mix quite different.
For instance, a rental plant may have larger-capacity machines, since they can process all work in a specific category together. As a commercial plant must keep each customer’s goods separate, smaller pockets may be needed. Likewise, OPLs may not have sufficient volume of specific categories to warrant the larger equipment.
Rental plants tend to specialize in certain items, and have a disproportionate amount of those items. They gear their production operation to that specialty.
Record keeping is also different. In-house operations are allowed to estimate many things. Usually such an operation has one customer, and that customer is in charge of the laundry.
For example, the institution may supply steam; there is no way to tell if the laundry operation is having a positive or negative effect on the cost of gas for the institution. If the laundry runs an hour more or an hour less, the chief financial officer isn’t able to determine the impact.
Furthermore, the impact may be considered insignificant. Therefore, the cost of gas is estimated. This allows for estimating the size of loads that are being washed, and so on, including the pounds per year. In the absence of specific and verifiable numbers, the cost per pound is just an estimate. It follows logically that the production numbers are estimates, too.
Generally, the actual costs related to an in-house operation are considerably higher than a commercial operation. That doesn’t make one better or worse. They are just different.
OPLs have some latitude regarding rejects, the size of packaging, and the shape of folds. If your operation is in-house, you may have a great deal of input regarding the size, weight and quality of items purchased. You have a great deal to say about delivery schedules, and whether you will provide five-, six- or seven-day service.
If your laundry is commercial in nature, you take what you are sent, you fold, package, deliver, count and weigh according to what the customer wants, and you make deliveries generally at the convenience of the customer.
Many times, we in the laundry industry get defensive about the different types of laundries. There is no reason for us to be that way. But there are plenty of reasons for each type of laundry to be as efficient as possible, and to measure efficiency and be able to explain expenses.
An unfortunate fact is that many institutions keep their managers in the dark regarding expenses. No one is benefited by that lack of knowledge.
HEALTHCARE LINEN SERVICES
Rick Massey, Manager of Linen Services, Lakeland (Fla.) Regional Medical Center:
A laundry’s purpose is to process textiles and provide safe, clean linen to customers or patients. To that end, there is little difference between large, small, on-premise, shared-service or commercial plants. There is an amount of personal satisfaction to be derived from supervising and managing these processes and experiencing favorable results in all of these facilities.
I see the major differences between plants in two areas.
The first is the degree of automation within the plant. Small on-premise laundries will typically do much of their work with small-capacity equipment and be fairly labor-intensive in finishing and folding. Medium to large OPLs will generally have more automated finishing and folding equipment, making a conscious effort to reduce labor-intensive tasks.
Large shared-service laundries and commercial plants tend to be highly automated with batch washers, shuttle conveyors and pass-through dryers greatly reducing manual labor requirements.
Second is philosophy of operation. An OPL, while having financial and operating guidelines, tends to focus more on providing what is needed in abundant quantity and good quality while also gearing delivery and service schedules so as to provide other staff with what they have determined is needed for quality service or care.
Shared-service laundries tend to focus on delivering good-quality linen to all participating institutions on a schedule that is the best fit and lowest cost for all.
Commercial plants will process goods, meet requirements – both regulatory and customer-based – and deliver goods in a manner that best guarantees a positive net operating margin. This is rightly so, as they are in business to make profits.
There are subtle differences in laundry operations, with each having a different emphasis on operational procedure. None should be considered less desirable than another – only distinct, based on their requirements and outcomes.