Episode 7 – Equipment Innovations, Plant Design and Renovations

Welcome to the TRSA podcast. Providing interviews and insights from the linen, uniform, and facility services industry. Most Americans might not realize it, but they benefit at least once per week from the cleanliness and safety of laundered, reusable linens, uniforms, towels, mats, and other products provided by various businesses and organizations. TRSA represents the companies that supply, launder, and maintain linens and uniforms. And in this podcast, we will bring the thought leaders of the industry to you.

 

Hello again, and welcome to the Linen Uniform and Facility Services podcast by TRSA. I’m your host, Jason Risley. TRSA has had a busy schedule recently with the Canadian Production Summit and Plant Tours in Montreal, the Production Summit and Plant Tours in Philadelphia, the Maintenance Management Institute, and the Annual Conference which was held last week in Napa, California. TRSA has had some great content at these events, including a panel presentation at the Production Summit and Plant Tours in Philadelphia on plant design and renovations. The panel featured Bob Corfield, CEO of Laundry Design Group, Ed Kwasnick, director of business development at Arco Murray, Chip Malboeuf, president at Turnkey Industrial Engineering Services, and Gerard O’Neil, president and CEO at American Laundry Systems.

 

The discussion was moderated by Dan Farnsworth, vice president of sales and marketing at Leonard Automatics. Let’s listen in. Alright. Well, good afternoon. My name is Dan Farnsworth.

 

I’m vice president of sales and marketing for Leonard Automatics And I’m the moderator of this group of guys right here. Hey, you’ve got a great group of guys up here. They’ve got over a century of, experience between the 4 of them. So, to introduce our panel, I’ll start with Ed. Ed Kwasnick.

 

Ed’s the Director of Business Development for Arco Murray, which is a construction firm. They’ve completed over 4,000 projects across North America. Ed has 25 years of hands on experience designing, constructing, operating laundry facilities. Previously, Ed was president and founding principal in a engineering laundry consulting firm and prior to that he was a division engineer for National Uniform Company. Ed Zalene’s 6 Sigma Black Belt and he has his Bachelor’s degree in Mechanical Engineering from Virginia Tech.

 

Next to him is Gerard O’Neil. Gerard’s President and CEO of American Laundry Systems, a division of E&0 Mechanical. If you’ve been around long enough, you know the old E and 0 days. Gerard’s experience includes process engineering of marine and land based industrial platforms. Gerard’s a mechanical engineer by degree and he held, management positions in the shipyards of Ireland.

 

As founder of American Laundry Systems, Girard recognized a need in the commercial laundry, industry in the United States and Canada for a practical and common sense approach to the short and long term planning and implementation of design and engineering upgrades. Gerard has over 30 years of experience in the laundry industry. Next, we’ve got Bob Corfield. Bob is President and CEO of Laundry Design Group. He’s a veteran in the laundry and textile industry.

 

Bob has served in consulting, sales and project management positions for over 28 years. He’s visited and evaluated laundry operations in over 20 countries and he brings a very broad understanding of what’s possible in your laundry. Bob’s a frequent contributor with, all of the different publications and in cooperation with TRSA, Bob assisted in developing the inspection protocol for both the Green Clean and Hygienically Clean Plant Certification Programs. And then we’ve got Chip Malboeuf. Chip is president and principal of, for key, Turnkey Industrial Engineering Services.

 

He’s an industrial engineer. The engineering firm that, he is the principal of specializes in providing facility planning and process improvement services for companies in textile rental industry. Chip has 24 years of experience. He’s LEAN 6 Sigma certified. In in way of, there’s a couple of us in here that that have similar experience but Chip’s other career experience includes design modification of power distribution systems for nuclear aircraft carriers out at the Newport News Shipyard.

 

Chip holds a master’s in Business Administration and a bachelor’s of science in electrical engineering. So you know the ground rules. We’re just gonna get into the nitty gritty of it and we’re gonna start with Ed. Each person’s gonna have about 10 minutes but but Ed’s gonna gonna give us a 30,000 foot overview of of what the advantages and disadvantages are to 3 different disciplines when looking at a laundry. From a new plant design perspective, from a build out perspective, and when we say build out we mean buying an existing facility and converting it to a laundry and then renovation or expansion of your expansion of your existing laundry.

 

So Ed? Alright. So, show of hands, how many people have been through a laundry renovation in their career? And I’m up there. Proud, right, renovation.

 

What about a new build where maybe you took an existing building and turned it into a laundry? Have you been through that before? What about a brand new build from scratch? So I don’t know if you can see by show of hands looking around the room, a lot more hands went up for the renovation portion of it. When we talked about a build out, there were fewer hands and with brand new builds, there were even fewer hands.

 

And I wanna talk a little bit before we get into the nitty gritty and the other folks here talk about equipment and they talk about efficiencies and they talk about options that you have when you’re looking at a renovation or a new build, I wanna kinda define for the rest of this discussion what we mean specifically when we talk about renovation, build out and brand new construction, and talk specifically about, you know, the advantages and disadvantages. And I’m an engineer, and engineers can’t talk without drawing. So I’m gonna go to that little board right there, and I’m gonna draw a graph real quick that I think is gonna demonstrate to everybody specifically the advantages and disadvantages for the rest of this discussion. So can you all over there see? Basically, I’m gonna draw a really easy graph.

 

We’re gonna put money right here. By the way, that’s the only language that engineers, accountants, general managers, owners, and construction companies that we all talk simultaneously, we all know what we’re talking about is when we talk dollars. The dollar’s over here, and we’re gonna talk efficiency down at the bottom. We’re gonna draw a line that looks kinda like this. So when we’re looking at and by the way, this is increasing dollars increasing efficiency going in that direction.

 

So when we’re looking at a renovation, this is taking an existing building. It’s an existing laundry that you already have in place, right, and you want to either renovate it, meaning that you wanna replace equipment inside of that, increase productivity, or even an expansion of that existing facility, that is typically going to be a relatively low low dollar cost for that. So it’s gonna be somewhere right in here. So there’s gonna be a cost associated with that. It could be half a $1,000,000.

 

It might be $3,000,000. But basically, you’ve already got the infrastructure in place, and now you’re just adding on to that infrastructure. So you already have all of your piping and your electrical and and a lot of equipment, and maybe you’re upgrading some of that equipment, maybe you’re adding 10,000 square feet on, but you have a functioning laundry. And so there’s a cost associated with that, and by and then by actually doing the renovation, you’re going to increase your efficiency and your capacity. So we’re gonna call that r for renovation.

 

K? So let me ask a question. So now we’re we’re gonna look at the next step up from that. Instead of renovating the existing plant, the existing plant’s too small. It’s already it’s in Philadelphia.

 

It’s downtown. It has no lot line I mean, it’s right up against the lot line anyway, and I can’t expand it. I can’t renovate it. So I have to build a new facility, but I’m not gonna build a new facility from scratch. I’m actually gonna go find an existing building, which happens quite often.

 

For Arco Murray specifically, for every one plant that we build brand new, we’re doing 3 or 4 where we’re taking an existing warehouse, and we’re converting it into a laundry. It’s a very cost effective solution, and that’s what we call a build out. So from that standpoint, there’s more cost associated with the build out, and then you’re gonna gain some additional efficiency. So often with a with a physical build out, there’s an existing 60 let’s call it 60,000 square foot facility, you’re gonna move into that facility. There are some constraints.

 

The building already exists, there’s a ceiling height, there’s certain utility requirements, there’s already, you know, certain level of utilities that are there, there are some constraints, but it does give us the ability to be able to work within those constraints, maybe improve some of the efficiencies of the equipment, put in more automation. There’s a little more customization you can do in that environment that you couldn’t do when you were just trying to renovate an existing facility. The third option is going to be a brand new build or what we call a build to suit, so I’m gonna call that BTS. And you can see on here again, significant more cost because you’re building a building from scratch, you’re buying a piece of property, etcetera, but also an increase in efficiency. So I wanna set the ground rules for this discussion that there’s really 3 options.

 

When you’re talking about renovating your facility, you’re talking about taking what you already have within the footprint that you have and then upgrading equipment, potentially, and systems, or even adding on to that building. That’s number 1. The advantage of that is cost. It’s not it it’s there’s a significant cost to that, but it’s not gonna break the bank. Right?

 

It’s not you can spend half a $1,000,000 in upgrade equipment. You can spend a 1,000,000 and a half dollars in add a building addition, and you’re gonna gain some efficiency. The next step up is gonna be the the build out option where I’m gonna buy a building that’s existing and convert it into a laundry. Again, there’s some constraints there. There’s additional cost because I’m putting a lot more work into converting that space.

 

However, at the same time, you’re gonna gain more efficiency. So you’re gonna get higher productivity, lower costs. And then the creme de la creme of all those options is to say, I’m gonna find 10 acres, 5 acres of grass, and I’m gonna build it exactly the way I want it. It’s gonna be customized for my specific needs, and I’m gonna upgrade the productivity and the efficiencies and the automation in that facility. So there’s significantly more cost, but as you can see, there’s also a big bump in efficiency and effectiveness of the facility.

 

So when we talk for the rest of the discussion as we’re talking about renovations, I want you to kinda keep that in mind as we move forward. Does that kinda match up with your experience, those who in the room who’ve done renovations versus doing a a build out versus a build to suit? Yeah. I think it depends on what kind of plan you’re building. Okay.

 

If I’m building a clean room, then that works. If I’m building one of our mixed laundries, that the the new the new build isn’t more expensive. Uh-huh. Down the rail systems. I gotta put in a lot of rail systems, then the new build, I can design smartly, and I can get the structure in the building.

 

Mhmm. When I go in and retrofit, like you guys have done for me a couple of times, I spend so much money on structural steel on the inside supporting rail systems. So so from your standpoint, you’ve got you’ve already got a structure there in this building. You’re you’re gonna take a warehouse, and you’re gonna convert it into a laundry. You’ve got a structure there, but it will not support the rail systems.

 

You’re putting in quite a bit of clean side and soil side rail. The cost to install that is pretty significant where you could have rolled that into the cost of the building if you’re building brand new. So you’re you’re finding that the cost between a build out and a build to suit are are much closer, like right on top of each other. And so by the time you buy the land or buy the building then convert the building, you could have bought the land and built something brand new is what you’re saying. There’s a whole longer time buying Yeah.

 

So much. In fact, if I had to if I had to go, I could almost build it cheaper if I start new. If it’s running for sure. That running facility, very expensive collection. Part of what we’re seeing too, and this is just a market trend, we’re not seeing a lot of warehouse inventory in the market anymore.

 

During the downturn, there was a glut of of buildings that you could look at and purchase at pennies on the dollar that you can then turn into a laundry. Those buildings are in a they’re out there, but they’re harder to find and they’re a lot more costly. And so to your point, we’re finding that the cost of building a brand new building is starting to approach the cost of buying one of these existing buildings because the inventory is not there. And so people are putting a premium on building cost. Yeah.

 

How do you able to save a lot of money in our rail systems by design? Like, you were talking about the efficiencies being up. If I own a warehouse, I’m in a I’m connecting the stat to the stat to this conveyor and I can eliminate that conveyor entirely by design. Again, it goes back to what longer you’re building. If you’re building a healthcare laundry, it’s not as much rail system as, you know, a mixed industrial light.

 

So it it changes depending on exactly what the Anybody else? So we’ll go to Gerard and and Scott, thanks for your insight there. That’s Scott Voss from Aramark Uniform if you don’t know him. But but it’s a good segue into where we’re going because what we want to focus is focus on is is balancing and upgrading of equipment and technology and how do we integrate new technologies into our our renovations. And and so Gerard’s gonna talk about renovations specifically.

 

He’s got a lot of experience with those. Gerard? Thanks, guys. So Ed’s line’s here. For the most part, I would agree with him except under renovation issue.

 

What I see a lot of people running into is it can be a major can be a major undertaking for sure. The plants gotta stay running. And if you’re upgrading equipment, if you’re adding a new washroom, that’s pretty easy to do. If it’s a complete renovation, that’s difficult. So now not only do you have to stay running, you gotta keep on servicing your customers.

 

You don’t want any interruption to that, for sure. But a lot of the new equipment, specifically the larger tunnels, larger, water systems, recycling, etcetera, are gonna put more of a strain on the utilities in the plant than you thought. Your existing plant is built for x, let’s say, x amps or x gallons per minute, and now you’re putting in more equipment, you gotta test that equipment. One of the pitfalls is you bring in the new equipment, you set it up, you still gotta keep the old equipment running, but know you have twice as much equipment under one roof. You gotta get proven walking before you can disconnect and remove the older equipment.

 

Plus you gotta find the space. So you gotta find the hole in the facility. Sometimes you can’t. Sometimes you’re landlocked if you can’t. Sometimes you can’t get more, water if you need more water if you’re expanding, if you’re going up in poundage.

 

Sometimes you can’t get more electricity. One of the benefits I do is though you have an existing trained workforce. Going off and finding an industrial park with the land for a new building, sometimes can be a problem. You got a ship in your, FTEs. It’s a headache.

 

They’re not always readily available, and who wants to work in the laundry? Those are the biggest things. Turnover is the biggest problem I see in most facilities today when I walk into them. How do you retain your employees? Well, when they can go to McDonald’s and get the same money, it’s tough to do it.

 

Back to renovations. Pitfalls of it, what I can tell you is plan, plan, plan. And when you’re done planning, plan some more. And when you’re done with that, plan it plan again. Plan for Murphy’s Law.

 

Murphy will show up every weekend when you’re doing a transfer over of equipment. The crane won’t show up, or the crane will drop the press off the back of the truck. I’ve seen that happen plenty of times. You gotta you gotta have a plan in place for when Murphy calls because he will call. Is it cheaper than the other render, options?

 

I would disagree. I think it’s more expensive than the build out. Probably not as expensive as new construction, but it would be more expensive than the build out. You have to keep your plant running. You’re gonna be paying overtime.

 

You got people who are gonna be there weekends. They’ll be there midnight. Whatever you have to do to keep the customer satisfied is what you gotta do. Keep the plant running, And you gotta find hours to get the new equipment in and install, operational, tested. Where those always come from?

 

If you’re a 2 shift plant, you’re running out of hours quick. If you’re a 7 day a week plant, you’re running out of days too. Renovations can be very, very tricky. If you can find a hole in the plant, you’re lucky. You can’t, you have to expand a little bit, build an exterior, like I’d say, 10,000 square feet, 20,000 square feet, 20,000 square feet, whatever you need.

 

There’s your hole. That’s where you start. And you’d start in a logical process from there on in. That becomes the new soil area, or becomes the new washroom. Now you can move equipment around.

 

You can play that chess game. If you don’t have the room and you need to add some customers or some, you know, large health care organization comes to you and says, hey. Here’s £6,000,000 a year. Great. Take the take the contract, but you may not be able to renovate the plan to do it.

 

You might have to go off-site, either by finding the build out, our our new construction. But utilities, pitfall. Hours of operation, pitfall. How long it takes? Always takes longer than you think.

 

You allocate 3 months of overtime for your plants, it’ll take you 6. It always does. Code enforcement. You take on you undertake a major undertaking in your facility that’s been grandfathered for, I don’t know, 20 years. It may not be anymore.

 

You’ll have to bring it up to 88 compliance for a start. Code enforcement officials love to get an opportunity to come through an existing facility. You’re gonna bring them in to look at all the new work, but while they’re there, they’ll poke around they’ll poke around and look at what was existing, and they may make you change that too. So be prepared for it. So again, plan, be prepared.

 

It’s not going to be cheap, never are. They always cost more than you think it does, and the headaches. Be prepared for pain. Stop pain free. It’ll be painful.

 

It will. Reducing it is the trick. Spend 6 months in advance getting ready for it. Longer if you can, but it will be painful. Always is.

 

Questions on that? You know that. On a happy on a happy note, you get a new plant at the end of it, but it’s painful. I I’m a realist. I’ve done this too many times.

 

If you think it’s gonna be a walk in the park, it is not. It’s gonna be painful. Would I do it? Sure. One of the benefits is is you can’t stress enough is you have an employee base already trained in the in the plant, finding new employees to bring to a new plant is a struggle.

 

These guys will say the same thing. Nobody wants to walk in the laundry anymore. We good? Yep. Alright.

 

Alrighty. Here we go, sir. Alright. So we’re gonna move on to Bob Corfield. Bob, tell us about build outs.

 

Well, really kind of commenting, on, what my esteemed colleagues here have actually already shared with you is that, now you decide on either new build or possibly retrofit an existing facility. What are your challenges? What kind of technology can you employ? I can tell you that, to to comment on what Scott indicated here, it’s with over 2 dozen investigations that we’ve done on-site locations and, and investigating new build versus retrofit, we find almost every retrofit of the existing buildings to actually be more expensive. You have to undo before you can do.

 

And then the good news and the bad news is this, with an existing envelope, you are now limited on what you can actually choose to do. Think about that. You have existing 22 foot ceilings versus 28 foot ceilings or whatever you might have. You have existing walls or buildings or docks or other things or existing doors that are not exactly where you want them to be. So you have existing structures, but now you just have to add those in and you get to move forward.

 

The difference is really time. So now let’s talk about the actual build out itself. That’s your infrastructure. That’s your piping, your your venting. Now the one thing that we actually generally find that people under budget for significantly, and that is your infrastructure related to environmental engineering, that is your your, air movements, your lighting, all of your bathroom, your employee fixtures, all the rest of that.

 

Your sub infrastructure related to your wastewater, discharge, pits, trenches, all of those kind of things, and the limitations you may or may not have depending on the municipality you’re building in. So when you start talking about build out, you’re talking about all the infrastructure to run your laundry, but that’s both structural, mechanical, electrical, HVAC, possible structural to the building itself, related to any things you might have to with air discharge, noise, abatement, as well as what you have to do with all your truck docks and any immediate remediation you may have related to your transportation systems and environmental systems to be able to get waste and other management issues related to your building? Okay. So Ed asked the question. He had you raise your hand.

 

So how many of you have actually been through, and I think he he said it again, existing building retrofit? Okay. So within the context of that, you also, run into, and I think Gerard touched on it as well, is what you’re gonna have to do with code enforcement and management, as it relates to anything you have to do with your employee access as well as your equipment. With all due respect, when we start talking about equipment innovations, there’s a lot of things that we get to take advantage of these days and make sure that you can actually, employ. So yes, we have larger tunnel systems.

 

We have more, more thought provoking monorail systems that actually can give you better, material handling and management. You have, some choices you have to make when you’re given either a space or a budget consideration within the context of of this curve here And you start to think in terms of, do I need more productivity per person or more productivity per square foot of plant? And they’re not the same thing. They are not the same thing. So when you start thinking about your budget versus your efficiency and then you start talking about the one important thing that we get involved in here, and that is phased development for the future.

 

I do not start a design on any plant based on the fact of what you need today. I have to crystal ball this thing, and I have to look at 5, 10, 15 years, maybe even 20 years out what your build out could be. Am I leaving space and room in your in your functional design within the framework of where you’re trying to what you’re trying to accomplish long term at a so many garments per week or so many £1,000,000 per week or whatever your your your net goal is gonna be, how many garments, how many mats, what kind of mixed plants you’re gonna be running, if you’re health care, if you’re certification compliance, all of those things. Are we leaving enough time and and and and room for innovation and technology to be able to take you all the way through a 20 year plan. So within the context of your designs, you have to really be thinking in terms of both your water and infrastructure.

 

You gotta get those right. Are you sizing for enough electrical? Are you sizing for enough natural gas? Are you sizing for enough water, water management, water recycling, and planning? And then all the waste management and employee management issues that you have to circle around within the context of your design.

 

I’m phasing you today to be able to accomplish your current goal. £15,000,000. I don’t know. Let’s say 80,000 to 200,000 garments a week. Whatever your design is gonna be, I’m gonna size for that today.

 

Okay? But I have to project that you’re gonna be expanding on a 5 year capital re reinvestment cycle. Where are you gonna take it? So I have to size the infrastructure in such a way that you can add those components and pieces as you move forward without having to rip them out and redo them. Okay?

 

Which means that I may have to imagine in the original build out that I leave enough space for you to add more rails for garments, add another level, possibly going 2 levels or 3 levels up. I have to leave enough room for you to add more dryers or more conveyance so that you can move material around your plant as you add more ironers, as you add more pack out, whatever you’re going to be doing. When I have to think about in terms of compliance and certification planning, cart cleaning, pack out, weighing management, all the things that you have to do around the certification standpoint for functional separation versus cross contamination management, all the things you have to do for your food safety and asset program. So when we’re talking about design, we’re talking about build out. We have to anticipate not only today, a near future, and a far future.

 

And that’s the tough, tough part of the job. I don’t know what technologies are coming out 10 years from now. Some of the things that we’re employing today on a regular basis, 10 years ago, were either at the very back of the clean show in that little booth that nobody thought of, and now major manufacturers are employing them as major components that they’re putting forward for you. We see technologies coming from Europe, in garment folding, RFID management, sorting systems that have been far far more mature in other markets. They’re finally coming here.

 

If you’re not going to take it today, do I need to plan for it in the near future, and how do I give you an infrastructure to support that? The structural steel that Scott talks about, in some cases, we almost see a1000000 to a1000000 and a half to $2,000,000 in structural steel to hold all the automation that we’re talking about. The cheapest time to put that in is at the very first. If we’re all gonna agree, it’s always easier to do it now than to do it later. I’ve built enough houses.

 

I’ve built over 26 homes. I used to flip homes as a as a hobby. I still kind of do it really like I’ve got time for that now. But still, at the end of the day, you always have to think in terms of what do I need to do now to make sure I can do it in the future? And that’s where build out and infrastructure becomes so critical.

 

Now, we can talk all day about steel. We can talk about a lot of things, but we have 2 principal things that are generally missed. 1 is process air, which runs a lot of the automation in our plants, which runs a lot of the things we’re talking about. And I would say your air air management systems need to be a little more intelligently designed and the IT infrastructure. Some of the things we talked about this morning, with it relates to information management, everything from RFID or barcode or employee, accountability issues and as well as your safety systems.

 

One of the things that we see in healthcare, for example, is the HVAC, the air management, the blow down systems, but is also pressurization between soil and clean is absolutely critical for what we need to accomplish related to, compliance with certification as well as what we need to be able to plan for for any changes we make in the in in the plant as we move forward. So your build out has to have a really solid foundation, a lot of thought put put into it. To Gerard’s point, you need to plan at almost 70% execute 30%. If you’re not putting 70% of your time into planning, you’re gonna overspend on your budget and and and your execution on your on your build out or your first retrofit, you’re going to costly fail. Your retrofit’s gonna cost you more money because you’re gonna have to undo before you can do.

 

So those are my advice. That’s that’s the big picture from our standpoint from a a retrofit planning and and kinda looking towards the future in technology is that you have to plan for the future today and make sure that infrastructure’s in place. Any questions? Both. I was talking about HVAC as well as compressed air.

 

Both of those are 2 major failures that we see in almost every long term plan. Compressed air is is really it’s just really poor design. And and as we look at more and more automation, especially monorail systems, we look at folding systems, we’re not seeing really good solid air design related to, both, you know, placement of of air infrastructure within, within plants, where it needs to be, how it needs to be, maintained. And also as we look at more and more automation, we’re using more compressed air, low low voltage electronics, and that kind of thing to actually drive that automation. It needs to be super, super clean.

 

Yeah. Clean and dry. Well, almost every plan that we put into when we talk about building infrastructure, I mentioned it and I glossed over it a little too fast, is we have we plan for recycling in every plant that we’re we’re we’re we’re designing for today with a retrofit or new build. And, you have to absolutely employ, some kind of not reuse, which we’ve been using for years, but actual recycle and recycle within the context of compliance management. Now here’s the problem with compliance management is that it is different from one city to another to a city.

 

Every POTW is entirely different. And so that is not a global, statement that what I what I do in in in Wilkes Barre is not gonna work in Jessup, for example. Where’s my friends from from, yeah, Dempsey? But, I mean, we were involved in that project. And what was true in in in in, in one location, literally, you crossed the freeway, and you’re an entirely different sewer district.

 

So what was true in one place became untrue in the next and all of a sudden you had a compliance problem. So that is very, very location specific, which goes into when you’re choosing a location, you really have to do a deep dive investigation and code management, for water and sewer permitting and all the rest. So it is absolutely critical. I don’t think we can look at any new plant today where we do not plan on energy recovery, water recovery in every way possible, all energy reduction possibilities related to natural gas consumption devices, everything we’re doing with youire going to be out of compliance tomorrow. Itis itis we just have to continue to you’re gonna be out of compliance tomorrow.

 

It’s it’s we just have to continue to find ways to be smarter about all that. Now for a brief message from TRSA. TRSA has another great panel discussion coming up at its marketing and sales summit scheduled for December 12th through 13th at Caesars Palace in Las Vegas. The panel will feature Jim Divers, the director of sales and marketing at ALSCO, Ryan Flaherty, the vice president of sales, marketing, and business development at Aramark Uniform Services and AmeriPride Services, Dave Katz, the senior vice president of sales and marketing at UniFirst, and Bob Mitchell, the senior vice president and chief marketing officer at Cintas. The panel will discuss identifying and expanding markets and converting non programmers to new customers.

 

For more information, visit www.trsa.org/marketingsummit. Now back to the episode. Chip, talk to us about new construction. It it it sounds to me like new construction is a little bit easier, but I’ve been through a new construction plant and it was far from easy. So so help us out on that one.

 

Fine. Easy. To reiterate what Bob and Gerard talked about, even a new construction planning is a key. We advise folks when you’re looking at any type of project you want to plan. Where are your bottlenecks?

 

Where’s your inefficiency in your plant? And so when you’re looking at a new construction versus a retrofit versus a renovation, there are some constraints as they’ve talked about in the retrofits and the refurbishments. Or if you’re doing new construction think of it as a blank slate, a blank canvas. For you folks it’s football season so think of it you can open up the playbook. Now you get to go out and find the best quarterback, the best offensive line, the best receivers, and the best running back, but at what cost?

 

So we advise you to plan. Everyone says plan, plan, plan. What do I need production wise? What do I need for washing technology? What do I need for storage?

 

You have to plan the process first. We look at it in almost 3 buckets of the design phase, the building phase and the land acquisition phase when you do a new construction. They’re not they’re correlated and they run together but you can look at them in 3 distinct buckets. You have to plan, model your facility. Bob said you’re not designing this new facility to last what you’re doing now, you have to start looking out 5, 10 years, what is your capacity goal for that particular market?

 

Am I going to be a £100,000,000? What is my goal going to be? And design to that goal and develop a master plan. Make it the most efficient plan you can make it. Again, then you look at the idea of what kind of plant do I build?

 

Do I build a good plant? Do I build the best plant? So we advise you to take a look at 2 different scenarios. Again, return on investment, you don’t build these things to lose cash, cash flow is king. You wanna make sure you make money, so you wanna make sure it’s efficient.

 

So as as you’re designing your team, picking your quarterback, picking your line, picking your wide receivers, does it get me a return on investment? So I look at 2 different scenarios, a good scenario and a best scenario. So when, you know, Ed drew his graph here and you’re looking to build to suit, I may be slightly down here on a good plan, and I may be up here when I start designing best plan. When I start talking best plan, I’m talking high efficiency, highly automated. We also advise folks when you’re out there looking for new build to suit you have to do your homework.

 

Visit other plants, you have to go out and visit other plants domestically and in foreign. Oh look over in Europe, look at what they do. Look at the technology employed somewhere else. Look at Amazon, look at FedEx, Look at the way they do material handling. Can I apply some of those material handling techniques to what I do?

 

So do your research. Do your homework. Because again, you’re talking greenfield. So, you know, there is a budget. Obviously, cash flow, you have to make some money at this.

 

But look at the technologies that are out there. Look at the good versus best. And is there a return on investment? That delta between good or best, does the ROI pan out? If it does, then then go for it.

 

It. And what you also wanna look for too is we’re talking about labor. You know, it’s been touched on here that labor is difficult to get. How many folks are having trouble filling positions in their facilities right now? It’s very difficult.

 

So when you’re looking at technology and looking at new plants, maybe you design the plant so maybe I don’t reduce employees at start up, but the relationship between increases in volume and my number of employees, that correlation falls apart where my volume increases at a quicker rate, I don’t have to add as many employees. Automation can help you get there. So again, look at those aspects when you’re looking at designing the facility. So design the process first. You want to design the process and we always joke with our clients you could put a tent over it for all I care as long as it’s efficient.

 

That’s what makes you the money to be able to service your clients efficiently and well and on time. So you look at that part and design the facility, do your research, go out, tour plants, ask your fellow co operative ask your fellow operators what’s their experience. Look at technology and ask their experience. Vendors are more than happy to share with you what’s coming down the road, showing you different technologies that may be coming down the road that you need to consider and plan for. It may not be ready now, but you need to plan for it.

 

Again, plan, design and then design the envelope. We talked about there’s a greenfield, now I’ve got the envelope. So now I can design the envelope around the process that I’ve designed. I’ve designed the process to meet my master plan which may be 10 years out, 15 years out. Now I put the envelope around it.

 

There’s certain construction techniques you want to look at. As Scott mentioned, one of the great advantages to a greenfield construction is I can design my column structure, 40 foot by 40 foot base, 50 foot by 50 foot base, I can design them how they want, how I want. I can put the structural steel into places so my monorail system, material handling systems can handle the growth and be able to grow with me. So again, the greenfield gives you that opportunity. So do the research on the building envelope.

 

As you’re looking at locations, most of you may pick out a site location or have a relative geographic area you’re looking at. As Joe brought up and Bob talked about is, do I have the infrastructure capable to support my facility not only today, but 5 years from now, 10 years from now, 15 years from now? Do I have the water infrastructure? Do I have the sewer infrastructure there? Is natural gas in the area?

 

What does it look like in that area? And do I have land capable of meeting my needs for my facility? As you lay out your facility it’s great to sit on a on a plot of land, but you have to look at truck movement. So as you’re looking at designing your building, can I move my truck safely around the plant? Can I move my truck’s tractor trailers?

 

Can they come in without taking out 10 of my employees’ cars when they turn around in the lot? So design with those things in mind. Again, you have a blank slate, you have an open canvas, but you have to plan for these things. You don’t plan just for now, you have to plan for 10, 15 years out. When you build new construction we don’t recommend you build the building to meet your 15 to 20 year plan.

 

You start to develop the master plan, scale the building back to what you need to meet your 3 to 5 year window. Then you become one of the retrofits and the refurb guys. But if you’ve designed your infrastructure properly that becomes less costly. I can design the walls to knock out the walls, I can design the way it sits on the lot so that I can meet those growth demands without absorbing, you know, some exorbitant costs when I do that. So again it’s very much a planning process.

 

So when you’re looking at, look at safety techniques too. When you’re building a building too you can meet a lot of different codes as far as passive fault protection versus active fault protection. When you’re selecting technology and automation, do I design the safety features? When you’re looking at clear heights, I can design clear heights. We recommend 28 foot clear to 32 foot clear if you can get it.

 

Where this way because gravity always works and the material handy guys will tell you here gravity always works and it’s much easier to work with a gravity system than a system where I’m constantly re elevating, de elevating, eliminating single points of failure in the process. So gravity works. When you have a high clear height I can also route HVAC systems, air systems, I can run the piping systems in the same square foot area as I have my monorail system because I have enough clear height to work with that. So there’s some advantages to being able to do the greenfield design but again you have to plan for these things. And don’t skimp on the infrastructure.

 

As Bob mentioned, when you start to look at the infrastructure eventually you’re going to be one of those renovation guys. As you get to that 10 year plan, you’re going to have to renovate when you hit certain volumes. Make sure your water systems are designed to meet that. It’s much less expensive to put that in in the beginning than it is to go back and try and retrofit water systems, air systems, natural gas piping, especially while you’re trying to operate. When you’re looking at land selection, so you design the building and now you can actually go select plots of land that meet your needs.

 

Is my building square? Is it relatively rectangular? What does my site look like to grow my building? Does I want to add walls, knock out walls? What does that site look like?

 

So again there’s much more opportunity for you when you do greenfield, when you do a build to suit. The cost is there because I have to build a wall, put the floor in, I can do all that. Scott mentioned there’s some savings opportunities if I can design the infrastructure, the actual structure of the building so my monorail systems I don’t have the floor support. So there’s some opportunities there, it’s just it’s a cost but it has to make money. There’s gotta be a return on investment regardless of what you do.

 

I have a question. When when we built our moderator gets to ask a question too every now and again. But, when we built our new manufacturing facility, one of the things that that really came up, and and this happens in a lot of cities, a lot of laundries are moving from in town to out into the burbs and into business parks. And and that’s basically what we did. And we did a demographic study of our employee base, where they all live, how far they have to drive.

 

We we did a survey on how far would you drive before you went to look for another position somewhere. And I just I just wonder if you run into that is that a consideration if you guys ran into the same thing? You bring up a great point. When you’re looking, most times you have an idea of where you want to locate this facility because you know where your customer base is, you want access to major thoroughfares, but the other key factors I want access my employees to have access to. We’d always tell you, look for public transportation, is that available where I’m moving to?

 

As you move further away from the city that becomes harder and harder to get. So yes, demographic, location so that you can continue to have your workforce is great. Public transportation is something we always look for. People in the city don’t necessarily have cars, so it’s hard to get those type of employees to actually go 15, 20 miles out to a plant. They just may not get there as reliably as they do with public transportation.

 

So we’re as you’re searching for land, we advise definitely look at public transportation and how do my employees are they gonna get there? I’m gonna make one comment too. It’s a little bit of a double edged sword too. Right? Because if you’re in the city, you’re closer maybe potentially to your customer base.

 

So double edged sword because if you’re if you’re gonna build in the city, that may be closer to your customer base. It may be closer to your employee base. It may be where you wanna be. Cost to build in New York City or Boston or Atlanta or so on and so forth is gonna be significantly higher. The actual cost of construction in that environment is higher.

 

And also going back to what Joe Garrity said earlier or asked earlier, impact fees are typically gonna be higher. So your water impact fee, your sewer impact fees, etcetera, could be potentially higher in downtown Miami than, you know, outside in in the sticks. So on one hand, you need to look at making sure that you’ve got the right customer base, but understand or excuse me, the right, employee base and make sure that you have access. At the same time though, remember costs are gonna be higher, cost of construction, cost of impact fees, etcetera, as you’re moving typically closer to the city. They’re gonna be lower as you move away and finding that sweet spot is what’s important, right?

 

Finding a spot where you can get the right employees, but also you’re not paying, a premium for that location or for the construction in that location. And to that point, the stats still is accurate. And I think there was maybe a a breakout session about the Surler. 1 in 6 plants still have a fire reported fire in the laundry industry. So that’s definitely a concern.

 

Happens all the time. Thanks, Ed. Back to the cities. Most of the cities can’t support the new plants. Utilities are not there.

 

They’re taxed as it is. So, even if you’re willing to pay the impact fees, which can be absorbed but as we all know they’re not there. Water is not available readily available in downtown Boston to build a laundry or New York City. It’s just not there anymore. So, touching on some of the new technology, yep, you recycle for sure, The cost of water is going to go one direction, electricity the same way, natural gas is the same way.

 

Efficiencies, planning, recycle, reuse, reclaim, all of the above. All of the above has to happen in a new facility, or renovated, or build out. But trying to find utilities in the first place, you may you may find a great location, employees, wonderful excuse me, interstate network to get your your, customers, and they don’t have any water. I think it’s really important You’re sorry. You gotta really do your research when you’re looking for a new facility or a build up.

 

Really do your research. I think it’s also important too, and this that needs to be stated, and that is that you need to choose what you’re going to build. In other words, are you going to build a uniform plant, a mixed use plant, a linen plant, a health care plant? Right now, the the days of of building a plant that can do anything and everything is a luxury that most of you cannot afford. Most of you really have to be thinking about purpose built facilities that execute really well on a range of business that you can execute extremely well on with both labor efficiency and plant design.

 

Trying to build a plant that will meet all comers means that it don’t won’t do any one thing well. I I can tell you that those plants that try to accomplish everything, I wanna do a little bit of food and beverage. I wanna do a little bit of uniform. I wanna do some medical retail. I wanna do some linen.

 

Then I wanna do some casino work, and I wanna do some COG, god forbid, rather than rental. You know? So, I mean, you really need to make sure that you pick pick a partner and dance with that partner. If you need to do something else because the marketplace leverages itself to more work, then build another plant that does that really, really well. Keep your costs low, your execution high.

 

Make sure you keep your focus. The most frustrating thing that we have seen with clients and trying to help them understand and navigate that decision alone is really hard because you just want to take it all. Your sales department says, well, God, boss, there’s this casino over here. I know we’re a uniform plant. Or, hey, you know, there’s this restaurant work over here.

 

I know we do health care. You know? No. No. No.

 

Pick up, partner, and play, and dance. I think it’s really important that you stay focused and you can keep your cost and your outcomes really tight. You’re ready for a you’re ready for a 3 hour discussion about 3 days. So so there Just a rule of thumb. Yeah.

 

No. No. I I hear what you’re saying. And let me let me speak into this. I hear what you’re saying about rules of thumb, and there was a time when when the when the industry was a simpler place and those rules of thumb, rules of thumb, were accurate.

 

Now, it’s not. I’ll give you an example. If there are folks that will buy 50,000 square foot building in the build out situation, so they’re going to buy an existing building and they’re going to retrofit it and they’re gonna put 2 tunnels and 4 ironers and and and the other company equipment in there, and that infrastructure cost is what it is. It just costs what it costs for the infrastructure for that regardless of the size of the building. So if if there’s something related to the building square footage, like for instance, you’re going to diamond polish the floor, well that’s $2.37 per square foot.

 

I’m going to redo the roof. There’s a cost of that per square foot, but the infrastructure you’re putting in for the laundry really doesn’t depend on the square footage as much as it depends on the equipment that you’re putting in. Right? So to that point, if I put that infrastructure in 50,000 square feet, that’s a very different cost per square foot than if I put that same infrastructure for the 2 tunnels, the 4 ironers, and the folders and everything else. If I put that in 40,000 square feet, suddenly my cost per square foot goes up, although my cost is the same.

 

If if both of those were, I’m making a number up, $4,000,000, your cost on one is is much higher than the other because the infrastructure costs are kind of set based upon the equipment package you’re putting in there. Now, where it does where there are some there’s some deviation from that is, you know, you’ve got office work that needs to be done in one facility, you already have an office in the other facility, you don’t need to do any work. You have to add docks in this facility. You don’t have to add docks in that facility. Or going back to infrastructure, you know, all the utilities are already there.

 

You’ve got a 4 inch water line and you’ve got a, an 8 inch sewer line. In another facility, none of that is there and all has to be brought from the street. So I’m answering your question by saying there’s really not a good rule of thumb specifically. Now that being said, let me share a rule of thumb with you. What we’re finding right now in the market is we’re seeing that a typical build out and I say typical build out, call it 30 to a 100000 square feet, is costing between $65.80 per square foot to build that out and turn it into a laundry.

 

So that’s on top of buying the building. Now you’ve got these costs. Brand new construction, again, 30,000 let’s call it 50,000 to a 100,000 square feet. Brand new construction where you’re just buying the land, and then you’re building everything on top of that, that’s gonna be typically a 120 to a $140 a square foot. But it will vary depending upon your specific circumstances.

 

So I’m putting an asterisk after both of those numbers. Does that is that help does that answer your question? Is that helpful? Okay. The old rule was 50, 50, 50.

 

Now it’s more like a 100, a 100, a 100. Yeah. It’s $50 square foot, $50 for equipment, $50 for interest. That was a long time ago. Now you’re probably close to 300 a square foot.

 

When you said 50, 50, 50, I think meant 50% equipment, 50% building, and 50%. 50 bucks is worth. So it’s gonna cost you a 150%. There you go. This you gotta be close to 300 more.

 

Yeah. I mean, I’ll be close to $300 a square foot now. Any other questions? Talking about recycling work. Is the technology good right now?

 

I mean, recycling You know, what’s Very good. Yeah. What’s interesting is the technology that’s actually been in our industry now for over 25 years. It’s the filter technologies are getting better. There’s more providers that actually operate, there’s actually a broader market both inside and outside of our industry, so that’s available.

 

The good news is that the technology is maturing and costs are coming a bit more in range than what they used to be in 10, 15 years ago. So the technologies are better, the applications are good. Chemical guys now need to know what to do. We recycle water versus, say, new fresh water, which understand recycling gives you 2 benefits that you really want, alkalinity and temperature. We love those things and and process water.

 

So we get to grab those things. We just wanna filter out enough of the bad stuff so we can reuse that, and we can do a 70 30 or 60 40 or or 80 20 split on fresh or reused to to freshwater input. So and that management there that we’re managing, what we’re what we’re doing. Use between a 100%. No.

 

It’s always gonna be about listen. Some of the guys will tell you 80, 20. I’m I’m more of a 60, 40, 7, 30 kind of guy, you know, because that’s more practical. There’s always gonna be certain water you can’t really recover. You shouldn’t recover.

 

Mat water, for example, is burned with sand and stuff. We can’t handle very well, you know, so let’s get rid of that. So we’re not gonna capture that, but we can also that matte water could also be recyclable. You you have you’re gonna have to you’re gonna have filter that up. There’s different filter technologies to be able to do that, but you’re you’re definitely gonna have to go down that road because the cost of water per gallon, energy, and all the rest of it just moved by the instance.

 

And you have to work with your chemical provider because some of these systems put out some high total dissolved solids numbers which would drive these guys insane because you’ll and you’ll have some very unclean linens. So total dissolved solids and pH levels are really some of these systems, these things fluctuate greatly which causes some really big anxiety attacks for your chemical provider So, I would definitely get them involved if you’re looking at water recycling systems that they understand, they can give you parameters that they will operate well with and provide you quality linens when you’re done. We’ve seen some systems involved that the smell coming off the linen is pretty future when it comes out because the total dissolved solids are 750. Are your whites are gray now from redep? There’s high foaming because your all utilities just I mean, the chemicals are attacking what’s in the water rather than what’s in the lemon.

 

I mean, there’s we’ve got a mature market now. We’ve got more technical knowledge right today than we did 20 years ago or 25 years ago. So I think it’s not a bad time to look at those technologies. It’s it’s we’ve got a plan for it. Let’s give them a round of applause.

 

They did a great job. If you’re considering expanding, renovating, or building a new laundry plant, hopefully, you learned something from today’s episode that will help as you navigate the process. After all, that’s what this podcast is designed for, to give you knowledge to improve your operations. So let us know how we’re doing. Send your feedback to podcasts at trsa.org.

 

Again, that’s podcasts attrsa.org. And don’t forget to subscribe, rate, and review us on iTunes. You can also listen to the podcast on Google Play and Stitcher.