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Spotlight on TRSA Support for Local Independents

TRSA’s exhibit, presentation and conversations with participants at the Oct. 30-Nov. 2 Universal Unilink annual conference highlighted the association’s value to linen, uniform and facility services businesses that fit the purchasing cooperative’s laundry membership profile: local service providers operating from a single facility.

Visiting the TRSA tabletop exhibit at the conference trade show, participants were introduced to Laundry Operations and Management, the new 200-page book that explains procedures, technologies and transactions of production, sales and service as they apply to plant workflow. The book is meant for all professionals in the industry, new and seasoned, regardless of job title, to improve their understanding of operations. It’s the only resource that explains how every manager and employee affects every stage in the laundry process.

While this primer applies to industry companies of all sizes (from international chains to local independent operators), it’s especially beneficial to operators with only a few routes by increasing employees’ understanding of discrete functions that are separate jobs in larger facilities but likely combined into single positions in their operations.

Universal Unilink is the largest group of independent uniform, linen and dust control providers and uniform distributors in North America. Since 2016, TRSA and this group-purchasing organization have jointly promoted services to improve the safety and performance of their member laundry companies. Combined, the organizations reach nearly 400 national, regional and independent operators in North America and worldwide, conducting professional development, reporting on industry news, trends and best practices, and providing networking opportunities and access to the industry’s most innovative suppliers.

TRSA’s presentation at the conference explained the association’s Industry Performance Report, an annual publication based on a survey of industry operators that generates industrywide financial and operating profiles for benchmarking. Survey participants’ balance-sheet and income-statement data is aggregated and segmented (by customer markets served, number of company plants, annual company revenue) to enable readers to compare their performance with industrywide norms for operations most like their own in these respects.

TRSA session attendees viewed 15-year trend data from the survey/report on financial ratios (including profit margin, asset turnover, return on assets, leverage, return on net worth) and income-statement expenses (plant, merchandise, delivery, sales, office/administrative), distinguishing how these metrics have varied between all survey respondents and just those with the highest margins.

The typical survey respondent (median) had about $6 million in annual sales in 2001; this median was almost $10 million in 2016. Sales for a high-margin company (top 25% of respondents by profit) were lower than the typical respondent’s in 2001 ($5 million) but higher in 2016 ($14 million). In the most recent survey, median profitability for the high-margin segment exceeded 11%; it was closer to 7% for the typical respondent.

Why did performance vary so much between the two segments? Clues were revealed as differences in everyday spending priorities were portrayed in the discussion of income-statement items. Similarly, attendees recognized variation in investment strategies as balance sheets for each segment were displayed. While the amounts in line items on the two balance sheets varied dramatically, their bottom lines were identical, as each group’s median total assets were $6.46 million.

Universal Unilink members not in TRSA were invited to participate in the upcoming 2018 survey at the same benefit level as TRSA members. Such participants receive a free customized report printed with their figures to easily compare their corporate performance with industrywide benchmarks and those of companies of comparable plant operations, annual revenue and customer markets. TRSA members who don’t participate pay a discounted price for the report; non-TRSA members who participate pay that same price; nonmembers who don’t participate pay $1995.

In 2017, about one-fourth of survey respondents had annual sales under $8 million and two-thirds were single-plant operations.

For more details on the Industry Performance Report and other TRSA studies, contact Tom Newell at 877.770.9274 or 703.519.0029, ext. 104. Company data is submitted confidentially to Mackay Research Group; contact John Mackay or Taylor Mackay at 720.890.4255.