Members Sing Upbeat Tune of Sales, Customer and Employee Retention

Maintaining profitable customers and increasing revenue from these accounts marked the 2022 performance of TRSA linen, uniform and facility services members. Their growth prospects looking forward in 2023 are brighter in the long run than the near term, following a first quarter when a solid majority of TRSA Business Pulse survey respondents’ revenue exceeded expectations.

Nearly two thirds of respondents to this survey, taken in February and March, indicated their revenues were well or slightly above expectations since November 1, 2022. Asked for their customer retention rate for 2022 (subtracting accounts they voluntarily shed), 96% reported 90%+ retention, with the largest segment of those (60% of all respondents) reporting 96%-99% retention.

To gauge the impact of upselling/cross-selling, unit sales growth and price increases (“wallet retention”), Business Pulse asked respondents to assess the sum of revenues from all accounts held for full year 2021 and retained in full year 2022. Some 85% said this sum was greater in 2022 than 2021. Of those who indicated it was greater, more than half said it was 10%+ more and about one quarter said it was between 5% and 10%.

Regarding accounts added in 2022 (not served in 2021), about 40% of respondents said this business accounted for 1% to 5% of all revenue; the same number of respondents, 5% to 10%: and almost 20%, 10%+.

Looking ahead 15 days in 2023, just under half of respondents forecast revenue projections well or slightly above prior expectations. The figure exceeds 50% over the next 30 days, eclipses 60% for the next 60 days and drops slightly (59%) for the next 90 days.

Nearly half expect customer spending on linen, uniform and facility services in the geographic areas they serve to be about the same this year as 2022. Almost 40% think it will be stronger. More than 60% of those who foresee an increase think it will be between 6% and 10%; about one third, less; the remainder, more.

Business Pulse results indicate recovery in the industry’s workforce, but not enough to serve 100% of labor needs. More than two thirds of respondents report production staffing levels at 90%+ with the remaining third, less. Route driver levels are about the same as production. Engineering/maintenance is closer to 50/50; with 15% of respondents reporting less than 80% staffing in this function. No other function had such a deficit. Customer service and management are closest to full staffing, with 91% and 96% of respondents, respectively, reporting 90%+ staffing.

Employee retention since August has been higher or substantially higher for production employees according to more than half of respondents. None said route driver retention is substantially higher, although more than a third said it’s higher. Almost half said it’s about the same and almost 20% said it’s lower. More than three quarters said engineering/maintenance retention is about the same as it was in August.