Business Spotlight: Wash, Rinse, Repeat

Dirty duds means big business.

Some 1,100 U.S. companies generate roughly $11 billion annually washing and servicing uniforms and linens, according to a Research and Markets report released in March.

A chunk of that pie belongs to Wilmington, Mass.-based UniFirst Corp. (NYSE: UNF), which since 1936 has been cleaning clothes primarily for industrial workers. Last year, UniFirst earned $1.6 billion in revenues across its 204 locations.

“I never thought I’d go to college and deal with dirty clothes. That’s what I do,” says UniFirst General Manager Charlie Combs, sitting in the conference room of a 65,000-square-foot plant tucked into a residential neighborhood southeast of Kearney Street and Kansas Expressway.

UniFirst entered the Springfield market through a 2002 acquisition of Rental Uniform Service. Roughly 70 workers serve 1,800 customers within 100 miles of Springfield, mostly blue-collar companies such as City Utilities of Springfield, Ozarks Coca-Cola/Dr Pepper Bottling Co. and Hometown Disposal. Renting UniFirst’s restaurant aprons and bar towels locally are Ocean Zen and Lambert’s Cafe.

Weekly routes
Each week, a UniFirst route sales representative picks up roughly 100 dirty garments and rugs at Trux Trailer and Tractor Repair Inc. and drops off the next week’s clean batch, including bundles of shop towels.

Wes Thurston, vice president of service and parts at the west Springfield trailer sales and repair shop, says Trux bids out the service every two years. He says the UniFirst shirts and pants hold up well considering the hefty wear and tear by the repairmen.

“If they start getting really bad looking, they go ahead and replace them. They’ll change them out before contract time,” Thurston says. “They usually hold up until the next renewal.”

The working relationship with UniFirst goes back about five years, he says, and involves some trade work for repairs on UniFirst trucks.

Springfield Production Manager Terry Osborne says rental and cleaning of company uniforms comprise 60 percent of business, and shop towels, aprons and bar towels represent the remainder.

“Our business is in renting uniforms. That’s where we make money,” he says, noting the garments UniFirst owns and rents are usually paid off after 24-36 months in the market.

Garments that come in the plant daily are sorted by material types – cotton in one bin and 65/35 blends in another. “Just like you do at home, but on a 100-time scale,” Osborne says over the sound of industrial washers and dryers humming on the plant floor. “We’re processing more than 10,000 pieces a day through here.”

The “washisle” is lined with $120,000 Braun washing machines that stand eight feet tall and mix chemicals and water based on computerized formulas. The washers are made with the same type of steel used to build U.S. battleships, Combs says.

“We sell service. Anybody can go out and sell a uniform,” Osborne says.

UniFirst also sells floor mats, mops, aprons and restroom products, such as toilet paper, hand towels and soaps, under its facilities services division, and first aid and safety supplies through a sister company called Green Guard.

Founding family
Though publicly traded, UniFirst remains under leadership by the founding Croatti family. President and CEO Ron Croatti has followed in the footsteps of his father, Aldo Croatti, and Cynthia Croatti – Aldo’s daughter – is an executive vice president and treasurer. UniFirst shares are trading in the $95 range, near a 52-week high.

Combs says he meets with Ron Croatti annually to review financial budgets and production, and Cynthia Croatti visited the plant staff in August. “It’s always someone in the family who gets to every location every few years,” Combs says. “They’re not just sitting behind the desk.”

The Springfield plant is in its third year of a companywide initiative to achieve quality management certification by the International Organization for Standardization. The local crew also earned a corporate safety award recognizing four years without a lost-time accident. The plant is now closing in on its next full year without a stoppage.

“I’ve got a lot of the veteran people here who care about what they’re doing,” Osborne says as shirts glide through the overhead conveyor from the steam tunnel to the shipping area. “That’s half the battle. If you don’t care, customer service is not for you.”

Following a 20-point inspection, Combs says 11 workers touch each garment through the plant, checking for ink pens left in pockets to missing buttons.

“We have a lot of push and pull here. It’s labor intensive,” Combs adds, declining to disclose plant revenues.

The Springfield plant serves as a hub to branches in St. Louis and Joplin, which opened just months before the 2011 tornado and went unscathed. Combs says 2012 sales are up locally more than 10 percent, including revenues from the two branches.

The plant was recognized recently for meeting the Missouri Water Environment Association’s water purity discharge standards, its 10th environmental award from the group. In addition to environmental concerns, plant operators also emphasize recycling, namely in the 15,000 hangers that come in and out of the door each week. The expense line item adds up to thousands of dollars per month.

“Hangers cost me about 6 cents apiece,” Osborne says, noting staff members sort through the batches of hangers to extend their roughly six-month lifespan. “When you’re doing 50,000 pieces a week through the plant, it adds up pretty quick.”