Linen and Uniform Supply Services
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Industry Overview
The US linen and uniform supply services industry includes about 2,500 companies with combined annual revenue of about $9 billion. Major companies include Alsco, ARAMARK, Cintas, and G&K Services. The industry is concentrated: the 50 largest companies account for about 75 percent of revenue.
The industry’s two main services are industrial laundry and linen supply. Industrial laundry services clean and supply heavy work garments, such as overalls, bib trousers, and protective gear; and laundered and unlaundered mats. Linen supply companies handle easier-to-clean, ironed items, such as aprons; hospital scrubs and gowns; and bedding, tableware, and cloth napkins ("flatware"). Because the two cleaning processes use different washing techniques and machinery, less than 15 percent of companies offer both services.
Competitive Landscape
Demand is driven by employment trends, as swings in labor and service hiring impact uniform and garment needs. The profitability of individual companies depends on efficient operations and maintaining low labor costs. Large companies have advantages in centralized laundry plant operations. Small companies can compete effectively through excellent service and custom solutions. The industry is highly labor-intensive: average annual revenue per worker is $70,000.
Linen and uniform supply companies compete with makers of disposable supplies. Competition also comes from large institutions with on-premises laundries (OPL).
Products, Operations & Technology
Major services include cleaning and renting industrial garments (33 percent of the market); flatware (20 percent); linens (15 percent); and industrial mats (10 percent). Other services include supplying wiping cloths, mops, cleaning products, and lint-free “clean room” garments. Linens and uniforms may be sold; rented (includes cleaning); or leased (without cleaning) to customers. Large companies typically process about 10 million pounds of laundry annually.
A typical contract begins with an onsite visit from a service manager, who assesses client needs and measures each employee for appropriate fit. Employees typically receive one change of uniform per day. A route representative picks up garments weekly and delivers them to a central laundry facility. Route representatives typically manage around 100 customers.
At the laundering facility, items are sorted by type and soil level, placed in carts or slings (bags), and weighed for billing purposes. Sorted items are placed on conveyor belts and enter either a washer-extractor or a tunnel washer, a computerized laundry machine where workers continually add batches of soiled laundry. Garments requiring pressing enter large flatwork ironers. Items that don't need ironing are moved by sling to large tumblers that can dry up to 400 pounds in a batch. Garments are sorted according to size and inspected for tears and excessive wear. Workers repair items as needed before route representatives return clean items to customers.
Major linen and uniform supply industry costs include cleaning and drying equipment, water, electricity, and detergents. Other major inputs include delivery vehicles, gas, and textiles such as cotton and synthetic fibers. Most companies own the equipment they use. A complete industrial laundering system can cost upward of $2 million; used and refurbished systems can lower the cost considerably. Workers need only basic technical skills as most computerized equipment is user-friendly.
Companies invest in technical innovations that can recycle water and lower the time it takes to clean garments. Radio frequency identification (RFID) tracking technology can help lower sorting and packaging mistakes to improve inventory management and delivery service. Some companies now outfit fleet vehicles with GPS to monitor route efficiency.
