Robert W. Baird & Co. and TRSA recently released the results of their Third-Quarter 2023 Uniform & Linen Rental Survey. In the latest survey, uniform rental operators remained cautious about growth prospects compared to the second-quarter survey, while linen rental operators remained in line with recent survey data.
Survey participants include senior executives at linen, uniform and facility services companies across the United States, with some operations in Canada and other international locations. The total response pool includes nearly 500 independent firms.
Key uniform rental survey findings include:
- Rental Revenue Trends: 32% of respondents beat their internal revenue expectations for the quarter versus 23% falling short (45% as expected). The 9% spread is the smallest since early 2021 and is the one data point showing continued moderation.
- Add/Stops: Employment-driven expansion at existing accounts (i.e., Add/Stop Diffusion Index) returned to positive territory at 56.8 (from 50.0 last quarter). This, despite recent downward employment revisions.
- No-Programmers: The no-programmer (new customers without an existing uniform program) diffusion index also returned to positive territory at 56.8, the first positive reading this year. Previously, this index was consistently positive aside from early lows following the COVID-19 pandemic .
- Growth Outlook: Respondents now expect +4.5% organic revenue growth over the next 12 months, improving from last quarter’s +4.3%, but still below (record) +6-7% at an earlier peak.
Key linen rental survey findings include:
- Rental Revenue Trends: 52% of respondents cited rental revenue trends above expectations with 44% in-line and just 4% falling short. A 48% relative spread continues trends of revenue at/above expectations, versus uniform rental.
- No-Programmers: No-programmer interest remained solidly positive at 66.0, little changed from 66.7 last quarter and remaining near-record levels. The index has been in expansionary territory since dipping negative in 2020.
- Growth Outlook: Forecasted 12-month revenue outlook moderated to 5.5% (from 6.5%) but remains near post-COVID average forecasts of nearly 6.0%.
Click here to view the full report. If you have any questions or comments, or would like to participate in the survey going forward, contact Baird Senior Analyst Andrew Wittmann at awittmann@rwbaird.com or Senior Research Associate Justin Hauke at jhauke@rwbaird.com.
Publish Date
September 22, 2023
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