If you are an owner/manager, how much should you pay yourself for the work you produce and how much are your real profits?
As a working owner/manager, I would suggest you compensate yourself at a rate of at least 150 percent of what your average employee makes per hour for each hour you spend working in the plant
If your average employee makes $8 per hour you should pay yourself at least $12 per hour for each hour worked.
This is an earned wage and should not be considered profit. Profits begin after you have compensated yourself for the value of your labor and properly considered real depreciation.
Earned wages
When you are working, you should be at least as productive as your average employee or else you are setting a poor example for the rest of your employees to follow. You should also have superior knowledge and training over your average employee that further increases the value of your time.
Employees at a plant with a working owner/manager on the premises are easily 10 percent to 20 percent more productive than a similar plant with an absentee owner. This can add a value of $1 to $1.50 per hour per employee. Your mere presence on the premises should not only raise employee productivity, but your quality as well. This adds value to your product.
Customers also are likely to see the additional value of being able to talk to the owner when there is a problem and you will likely have fewer of those problems in the first place when you are there on a regular basis. For these reasons you must consider the value of your time and pay yourself a fair wage for the work you actually produce.
Real depreciation
The government allows us to depreciate most of our equipment over a one- to five-year period. But if properly maintained, that equipment can easily last 12 to 15 years on average.
The result is that our true profit picture is often grossly distorted by accounting methods. While we should take full advantage of accelerated depreciation schedules for tax advantage, we should also adjust our internal numbers to account for real depreciation or real loss of value in our equipment.
In the early years, our profit picture looks worse than it actually is because accelerated depreciation schedules drive profits down. After the equipment is fully depreciated we reverse the cycle and our profits are overstated.
To correct this, I would suggest that you determine the current cost of replacing all the equipment and consider about seven to eight percent of that as real depreciation.
In a plant with replacement equipment valued at $150,000, you would consider $10,000 (7 percent) to $12,000 (8 percent) as real depreciation for internal accounting purposes.
If your reported depreciation is more than this, you should consider the difference as profit; if your reported depreciation is less than $10,000 to $12,000, you should consider the difference as a reduction against reported profits.
Why is this important? Consider that a couple operating a deep discounter may often work a total of 120 to 140 hours per week combined. Suppose the equipment is fully depreciated. They can pay themselves nothing and they show a $70,000 profit for the year.
Did they really make $70,000?
These plants often have equipment valued at $300,000 or more. In this type of plant the equipment will likely only last 10 years or less due to the extreme work load and tight scheduling demands. With $300,000 worth of equipment lasting 10 years, the real depreciation will be about $30,000 per year.
What appears to be a $70,000 profit is reduced to $40,000 after we consider real depreciation. Now consider that the couple worked an average of 130 hours per week for 52 weeks, or about 6,700 hours total, to make $40,000. That works out to less than $6 per hour worked. After you factor in overtime pay, they actually made less than an employee working for minimum wage.
The tragedy here is that in many cases people have paid hundreds of thousands of dollars to buy a business that generates no real profit and requires them to work long hours for minimal wages.
As a business owner you must charge prices that allow you to pay yourself a fair wage for the value of your labor in addition to a decent return on your investment, after you have properly accounted for the real loss of value of your equipment. Those who ignore these basic business principles won't likely be business owners for long.
Bill Bohannon is the owner of Hollin Hall Cleaners in Alexandria, VA, and president of The Drycleaning Edge, a cost analysis group that focuses on productivity and profitablity. He can be reached by phone at (703) 765-5518 or by e-mail at bohannon@tidalwave.net.This article continues the series profiling the "alternative" solvents to the two "conventional" solvents, perchloroethylene (Class IV) and petroleum (Class II flash point 100°F to 139°F and Class IIIA flash point of 140°F to 199°F.) Class IV solvents have no flash point and are non-flammable.
Petroleum solvents are flammable and combustible, and the Class IIIA solvents are considered safer than Class II since Class IIIA requires much higher solvent vapor temperatures to combust and burn.
GreenEarth, with a flash point of 170°F, is a Class IIIA solvent.
This flash point is in the high range of Class IIIA, and it is relatively safer than the petroleum solvents, including the synthetic petroleum of 147°F. GreenEarth has a fire point of 190°F, which adds to its safety, and it has a boiling point of 410°F, which requires vacuum distillation (as petroleum solvents). It should be stored in its original container, covered, at a temperature below 85°F since it is combustible.
The only engineering control required is an eyewash station, and only safety glasses are required for eye and face protection. GreenEarth is a modified liquid silicone similar to the base ingredients used in underarms deodorants, cosmetics, shaving lotions, etc. Its technical name is Silicone Siloxanet: decamethylcyclopentasiloxane (SB32). It is a clear and odorless liquid, and it is environmentally safe.
GreenEarth is manufactured by General Electric (GE Silicones), which is a joint venture between GreenEarth Cleaning and GE Silicones.
GreenEarth Cleaning System owns the patent on the solvent and its use. General Electric sells the solvent through qualified distributors.
GreenEarth Cleaning System charges an annual "Affiliation Fee" of $2,500 per drycleaning machine (washer/extractor or dry-to-dry), $250 per recovery dryer and $100 per dry store. Users actually buy the solvent from General Electric, not from GreenEarth Cleaning System.
Testing data: environmental
Both California and New York have approved Green earth solvent since it is not a hazardous air pollutant (HAP).
However, New York requires the use of a dry-to-dry machine, closed loop, non-vented, and the waste water must be properly disposed of so as not to pollute rivers, lakes or streams and to "minimize any public exposure to the solvent in drinking water."
It should be noted that California does not prohibit the use of transfer equipment, and most other states also permit transfer equipment. It appears that the state of New York has stricter regulations for environmental protection than California and that New York is less familiar with the environmental advantages of GreenEarth solvent than California.
Complete testing performed in Sacramento, California, has shown that GreenEarth solvent may be classed as non-hazardous and non-VOC (not volatile organic compounds) since it degrades in the atmosphere.
EPA lists the solvent as a non-depleting ozone chemical, and it is not regulated by RCRA or CERCLA.
Some states have qualified GreenEarth as an alternative technology for special funding or tax breaks. For example: North Carolina will give a 35 percent rebate on equipment expenditures to any drycleaner who "saves the environment," and the solvent used must not be a hydrocarbon or chlorine base.
Exhaustive testing has been performed on still bottoms, filters and wastewater. Twenty-six individual tests have been performed at three separate intervals and the test protocol has been reviewed by EPA for completeness from a regulatory perspective. Testing includes safety measures for operators and other workers.
Safety factors
GreenEarth solvent is non-toxic (oral, dermal and inhalation). It is non-irritating to human skin. It is non-sensitizing, and has no immunosuppressant effects.
However, as mentioned before, glasses should be worn to protect the eyes from accidental splashes (which should be most rare), and OSHA requires an eyewash station, which is a standard requirement for all industrial applications for all types of industries.
Operation factors
GreenEarth solvent has a low KBV (ability to dissolve mineral oil and grease) of less than 20. This is less than organic petroleum, synthetic petroleum, perchloroethylene and Rynex.
However, the GreenEarth solvent has a very low surface tension rating which means that it can actually penetrate and "wet out" oil stains very quickly This feature was also seen in the ability of fluorocarbon solvent (now outlawed) to dissolve oil and grease with its low KBV.
Total cycle time in a dry-to-dry cleaning machine, using normal extraction G's, is 50 to 57 minutes.
Total cycle time in a dry-to-dry cleaning machine, which is specifically designed for GreenEarth solvent, is less time due to higher extraction G's.
Also, a separate recovery dryer can be used as (modified) where permitted by the state of residence. Vapor pressure of GreenEarth solvent is lower than petroleum solvent.
The main problem in retrofitting existing equipment is with the water separator. Since GreenEarth solvent is almost the weight of water (7.91 pounds per gallon for GreenEarth vs. 8.33 pounds per gallon for water), the water separator must be specifically designed and engineered to achieve an effective separation.
Several machine manufacturers have been working with GreenEarth Cleaning to develop cleaning equipment specifically for that solvent.
In addition to the specially-designed water separator, higher Gs extraction and increased air flow for dry/recovery speed, the equipment will be in total compliance with NFPA Class IIIA solvent requirements. The new machines are water cooled for simplicity and economy, and the base tanks are stainless steel.
Classification for drycleaning is by fabric weight only. With GreenEarth solvent there is virtually no dye bleed since silicones keep dyes fast (stable).
NOTE: This author has always taught his students that classification by weight is more critical than color in order to obtain effective and efficient drying and recovery without objectionable odor.
With regard to soil and spot removal in cleaning, several detergent manufacturers have developed detergents for GreenEarth solvent that accept moisture additions as miscible in the solvent/detergent solution charge system. This is good news for water soluble soil removal.
With the reduced number of cleaning runs and the addition of moisture safely, GreenEarth cleaning technicians say that fewer errors and more speed in assembly of orders can be accomplished due to the greatly reduced number of stragglers resulting from the few number of loads cleaned. In theory, most incoming orders are not broken up due to less classification for cleaning.
GreenEarth solvent is gentle to fancy garments, sequins, durable trim, etc. There is no shrinkage, very little wrinkling, no static and no odor -- even in shoulder pads.
Solvent mileage is claimed to be greater than 50,000 pounds per 55 gallons drum -- about 1,100 pounds per gallon.
Special benefits for Affiliates (authorized users) include on-line ordering, listing of Affiliates locations on GreenEarth's website (www.greenearthcleaning.com), ability to offer coupons to customer via the website, website bulletin board for information exchange between affiliates and use of GreenEarth logo for store displays and marketing materials.
At present, there are 28 sites in 16 states plus the District of Columbia, and upcoming installations are to be in the United Kingdom, Japan and Canada.
At present, in the United States and Canada, there are field reps to service Affiliates in territories of Toronto, Connecticut, Florida, San Francisco and Long Beach, CA.
NOTE: As with Rynex solvent, this article should not be considered an endorsement by this author. This article, and the Rynex article, were reported based on information receive by mail and personal interviews. Both the negative and positive features have been reported.
Stan Caplan has over 35 years experience in his own high-volume drycleaning, laundry, and tailoring business, over 12 years experience in the coin-op laundry/drycleaning business and more than 20 years teaching and consulting. A former chief instructor at the International Fabricare Institute, the Southwest Drycleaners Association and the Illinois State Fabricare Associaton school, he offers consulting, training and engineering service to the fabricare industry, Stan can be reached at 3601 Clark's Lanes, Suite 307, Baltimore, MD, 21215; phone or fax (410) 358-0870 or e-mail at stancap100@aol.comI will never forget those early years, starting about 1953. We had competition, but the economy was booming and new technology was all around us.
It hit about the early '60s and it started with coin-operated drycleaning. Imagine! Eight pounds of drycleaning for $2! No pressing or spotting, and pre-spotting was free. Great for the public -- if it worked!
I once described it as the worst hoax ever perpetrated on an suspecting public.
The machines were made by some of the best names in industry, and had longevity to last as long as the are last notes were paid.
Most cleaners sharpened up their act and did the best professional job they knew how. Those who chose not to, within a three-year period, went out of business.
They taught a valuable lesson: "If you do your best, you can easily remain in business and prosper."
To quote Bill Seitz at the time, "No one went out of business for too much quality!"
Our sophisticated new equipment has all the new advancements available to conform to all the government mandates. Where will the financing come from? If we stray from the use of perc, we come into prices that verge on $150,000 a unit for the cleaning machine.
The biggest threat started soon thereafter and it is with us still today: "wash 'n wear." The early '70s brought a blood bath of failures, starting with double knits and polyesters. Those marginal plants with broken down equipment were the first to close up shop.
The problem of volume, as it is coming to be with today's shops, was the main problem then, too. The exception then was that the federal and state governments were not dictating restrictive legislation as it does for today's operations.
The price cutter's were around then, but not in force, as in today's market (89-cents for shirts laundered!) We know about wetcleaning and now we can handle over 40 percent of the volume in water, which drives up the finishing costs.
The latest "endorsement" comes from the garment industry advocating labels that read "washable, do not dryclean." Our businesses still revolve around volume and we get no support when dress-down Friday becomes dress-down all week.
One solution to keep volume up is starting a "route service," which knows no bounds. The additions now include all the avenues that two-income families with limited quality time are being offered, such as evening pick-up and delivery either at the office or home.
New sources of business also include TV and studio stage shows, weddings and banquets, uniform maintenance, etc., to name a few.
Those entrepreneurial drycleaners who saw an opportunity to diversify did so with gusto. More plants took advantage of their call office space to sublet their counter space. The first choice was to offer everything fabric-related, such as re-weaving, monogramming, pillow cleaning, shoe repair, drapery re-hang service, carpet cleaning and the rental of steam cleaning equipment.
Plants that have space can consider such sources outside our industry such as a real estate office, auto rental, tax accountant, and locksmith, watch repair or jewelry sales -- or whatever might be needed in the neighborhood. Here the imagination can take over. The advantage is an additional traffic builder for the drycleaning business.
We are now in the millennium and are faced with research chemists who haven't given up on the wash 'n wear. We still must contend with the "Woolites" and the Dryels and other home-care products. I think they will collect dust eventually, but not before our industry will have learned to sharpen up our act and be as professional, and managerial as possible. Fortunately, the public wants time off and not more jobs to do. Our image should be one of service, which we somehow have forgotten. We are a service industry!
I am waiting for the day when we can announce with pride that we not only make your cherished garments soil and grime free as new, but totally free of germs and all bacteria!
Of course we already do that, but we have made it the best kept secret. Don't we moth- and mildew-proof garments now? Isn't perc killing all bacteria now? Isn't drying and steam temperature destroying any remaining germs?
Why can't we say so? All our plastic bags should say "Make drycleaning your clothes' best friend!"
Clothes are clean, plus germ and bacteria free, thanks to the friendly drycleaner!
If we really want to be the professionals we say we are, let's make ourselves known not only as the Keepers of Good Appearance but also the Guardians of Good Health!
Ray Colucci, a consultant to the fabric care industry, has three booklets available that cover key topics. The titles include: "Up Front is Where it Counts," which tells how to train people to work at the counter and contains a pre-hiring personality test; "The Route to Success," which tells how to start, hire, train and sell routes and use a convenient, free-standing drop box; and "Pressed for Perfection," which ends the dilemma of hire and fire in the finishing department and provides a quality control final inspection color coding system. The booklets are available for $20 each or all three for $50. He also has a slide presentation seminar entitled "Management and Motivation" and he is available for speaking engagements. For information, contact Ray Colucci, 410 Warren Ave., Mamaroneck, NY 10543.It is fascinating to go to the trade shows and look at the new equipment.
The shirt units always seem to gather the biggest audiences. I suppose there are good reasons for that. For one thing, there have been some interesting advances in the design of shirt units during the past several years.
Among those improvements are the vacuum buck and the air blown sleeves
Furthermore, not everyone has shirt equipment, so there may be some that are simply fascinated with cool, new equipment that they just don't see everyday.
Of the folks that hang around at these booths, I think that they can be categorized like this:
The Curious
They don't own shirt equipment. They like to watch the professional pressers using equipment that they aren't personally accustomed to using.
The Wonderers
They use a shirt wholesaler and are a bit angered to see that the trade show pressers do a perfect job while their wholesaler doesn't.
The Potential Customers
This last group is the one that we'll talk about today. They are the potential customers for the shirt press manufacturers. They look at the beautiful new equipment and marvel at the ease of use, the perfect shirts coming off the press with seemingly no effort and the equipment that works flawlessly. They can't help but think, "This would be so good to have in my plant."
When they return to their shop, their own equipment looks more decrepit than ever.
So the question that they ponder is this: Is it time to replace my shirt finishing equipment?
You can easily find your brain in a tug of war, desperate for an answer.
Part of your brain is saying; "Look, my current equipment has been around a while. It has done its time. It has served me well. It is time to upgrade." Or maybe: "I can't produce a good shirt on my equipment now. My customers expect me to do this."
The tug of war begins: "I really don't need another monthly bill. What's wrong with me? Instead of spending $40,000 on this shirt equipment, why don't I spend $5,000 on what I have now? I'll bet that would turn it into a 'rebuilt' unit."
Or maybe: "I think that I'm just fascinated by the new-fangled machinery. My shirt unit is fine. Why am I even thinking about this when I am generally hesitant to do a $500 repair?"
There are probably hundreds of shirt units out there that need to be replaced.
Also out there are hundreds of shirt units that are replaced for the wrong reasons. Your job is to determine which group you are in.
Here's what I think you should do.
Get a completely objective point of evaluation of your equipment from a non-competing peer. Invite this person over for an afternoon to see your equipment in and out of operation. Offer to return the favor.
Naturally, this person should be in the shirt business and be at least moderately familiar with shirt presses. Give him or her a pad of paper and a pencil. Ask them to makes notes about everything.
By doing this, the things that are wrong with your shirt equipment -- the things you don't see anymore -- will show up on the list. What kind of things?
What about the loose cuff clamp on the sleever that is causing the sleeve gussets to come out all wrinkled? You may have stopped seeing that a few weeks ago, and the pressers may have stopped nagging you about it, but the issue still remains. You simply do not need a new Sankosha unit to have neatly pressed gussets.
On the list, your friend may write that your triple head's covers have big holes in them. Or he or she may find that the bosom carriage rides into the pressing position very slowly. Maybe that issue lends to unsatisfactory production.
Air leaks are the most common cause of other problems. I think that about 9 out of 10 plants that I visit have an air leak somewhere on their shirt equipment. Nobody hears it after a short while. This is not a good thing.
Certain presses are sensitive to fluctuating air pressure. Others are almost useless with unstable air pressure. Most air leaks can be fixed for less than the cost of lunch.
At a recent engineering job in New York, I found a severe air leak on the carriage-in cylinder on a bosom press. It caused the buck to require a push in order to move into the pressing position. I fixed this leak in about 20 minutes with a used part that my client had in his plant.
Net cost: zero dollars.
Long term savings: astronomical. His cuff clamps were loose.
Time to fix: Minutes.
Cost: Zero.
This client, by the way, fits well into the category of potential customers for the shirt press manufacturers.
He went to a show to do some fact finding. The fact is, his equipment is better than most out there.
There is a euphemism for letting necessary repairs go. Its called deferred maintenance. It's nice way to say it, but it's not a good idea. It does send a message to your staff that you don't care, although you probably do.
Now is the time to prove that you care.
It is true that you may have equipment into which you throw good money after bad. This can, does and will continue to happen. Your job is to find out if this truly represents your particular situation.
What is the cause of big problems with anything?
Not taking care of the little problems.
Think about it. It's true.
So, to see if you're in a situation where a new equipment purchase is inevitable, take care of those little things that you just don't see and hear anymore.
If a press lever arm breaks today, you are out of business. You will call the parts warehouse or the manufacturer and have one shipped overnight. It may cost hundreds of dollars.
The end result just may be that you have gotten nowhere. The press may work again, but the pressers may still be unsatisfied with the general operation of the equipment. You may still be unhappy with the way your shirts look.
Think of every little part on any of your equipment as absolutely necessary. Think of it as: "This machine is not going to perform to specs if this is broken."
In reality, this is very often a safe assumption. Put yourself in the shoes of the manufacturer: If you could save $10 on the cost of this machine by not installing this particular part and there is no penalty, would you have it as part of the equipment?
Surely not.
That means that anything and everything on any equipment in your plant should be in working order.
Today, when the press lever arm doesn't break, take care of all the little things that are an issue on your equipment.
If the press lever arm breaks tomorrow, you will be much less likely to think that you are throwing out money in order to fix it. You will be maintaining it. Fixing the little things may cost much less than a major chassis part and will almost surely yield some sort of savings.
The savings may be any one or any combination of the following things:
Aren't those things the very things that we try to do every day? Make today count.
Donald Desrosiers, a 22-year veteran of the shirt laundering business, is a work-flow systems engineering who provides services to shirt launderers nationwide. He can be reached at (508) 965-3163 or (508) 676-3940 or via e-mail at tailwind1@mediaone.net . He also has a web site located at: www.tailwindshirts.comShow this article to your customers before processing items with coated and backed fabrics. Make copies and have them sign the release before processing.
Fabric facts
There has been a recent increase in the use of coating for fabrics. In some cases, the coating is used for water or rain proof properties, or to simulate leather, suede or velvet.
Due to low melting points, some coatings are applied to a fabric when dry. Some other coatings can be sandwiched between two fabrics and be impossible to detect. Although some coatings form a natural adhesion to fabrics, others are held to the fabric with an adhesive binder. Some manufacturers have even applied an oily substance to a fabric giving it a unique look and feel.
Coatings that are commonly used are vinyl, rubber, polyurethane, acrylic, gortex (polytetra Fluoroethylene) PTFE, tyvek.
Coated fabrics are commonly used in men's & women's raincoats, jackets and ski jackets. Coated fabrics are also used in draperies.
Fabric problems
The use of coated fabrics by manufacturers may achieve their desired qualities but rarely can it be cleaned without fabric problems.
Stiffening. Vinyl is a plastic that uses a plasticizer to keep it soft and supple. Routine drycleaning will dissolve the plasticizer causing it to stiffen.
Puckering. Polyurethane, acrylic, gortex, rubber and tyvek will separate due to poor adhesion or the use of an adhesive binder that will not withstand routine drycleaning or wet cleaning. Imitation velvet or suede fiber will peel away from the coating used.
Streaks and stains. This commonly occurs on raincoats with rubber or polyurethane backing. During drycleaning or wetcleaning, the backing prevents proper drying on the seam in areas of double thickness. Sometimes the adhesive transfers to the outer fabric, causing staining that cannot be corrected.
Oil coated fabrics. This type of coating is applied during manufacturing and there is no cleaning process available that will not remove the coating. Attempts have been made to try to obtain the oil and reapply it, but it is rare that customers are satisfied with the result.
Mislabeling. Many manufacturers mislabel their fabrics as drycleanable.
Customer's choice. It is unfortunate that the consumer is left with burden of either throwing out the garment or risking cleaning. The customer should notify the store of purchase that potential problems may occur and that a refund will be expected if the garment can't be cleaned without damaging it.
Drycleaner. In spite of "Dryclean Only" labeling, do not dryclean when the label states Poly Vinyl Chloride, or PVC. Try wetcleaning procedures instead. Inform customers of the risk before processing any coated fabric.
Drycleaning
Dryclean coated or backed fabrics for three to five minutes. Keep the solvent temperature no higher than 80°F. Tumble in a reclaimer at no higher than 140°F. Hang immediately after drycleaning.
Gortex fabrics should be given a clear rinse according to the company recommendations. This prevents a loss of the feel and ability of the fabric to breathe.
Spotting
Dryside spotting agents will affect the adhesive binder of any coated fabric. Use wetside spotting agents and a non-solvent base leveling agent. Use limited mechanical action according to outer fabric to prevent fabric separation.
Wetcleaning
Wetclean according to labeling and limitation of outer fabric. Use cool water and mild lubricants. Rinse thoroughly to prevent streaks. Avoid gas-fired dryers which can affect some heat-sensitive coatings.
Finishing
Use limited steam and pressure when pressing.
Summary
Coated fabrics are popular because they provide waterproof properties, resistance to wind and an adhesive look. Depending upon the quality controls used in manufacture, the adhesive may break down causing a peeling, separation and staining.
Vinyl coated fabrics, or PVC, should never be drycleaned. Polyurethane, acrylic, tyvek and rubber coatings are unpredictable since the durability of the adhesive or quality controls in manufacture cannot be ascertained. A customer release should always be obtained.
Dan Eisen is chief garment analyst for the Neighborhood Cleaners Association Inter-national. NCA-I's "Principles and Practices of Drycleaning" course teaches all aspects of spotting and stain removal procedures. He can be reached at NCA-I, (212) 967-3002.This is Part Four in our series on the five sources for generating sales in the drycleaning business. We have already covered package plants, drop stores and routes. This month, we're going to discuss wholesale drycleaning.
When my mother and dad married in 1923, my dad had some money saved and used it to enter the drycleaning business. One of my mother's aunts was married to a gentleman who had a store and several routes. The cleaning was done at a wholesale plant.
With my father's money, they built a state-of-the-art plant with a complete laundry and shoe repair as well as up to date cleaning equipment.
My dad didn't know anything about drycleaning, but he was a good salesman. He started selling tailor shops on doing their cleaning on a wholesale basis.
Within a year, they opened some drop stores and, by 1929, they had about 56 stores and were one of the largest in the world.
The reason I gave you that background is that I'm well aware of the life and death of chain stores and wholesale plants.
A wholesale cleaner simply does the work for other cleaners who do not have their own equipment.
In many cases, a large operation would have many stores and a plant at the main location that did all the work for their stores.
In 1952, when I started working for R.R. Street in New York, I called on some of the largest chain store operators that serviced over 200 stores of their own.
However, the concept of wholesale cleaning has changed dramatically. Today, most all the chain stores and wholesale cleaners are gone from the scene.
They have been replaced by package plants, drop stores and satellite stores and the word "wholesale" now seems to be reserved for shirt laundering.
It takes extra space and expensive equipment to set up a shirt laundry. The end result is that those who did invest in the equipment, but who don't have enough shirts to keep their crew busy, will usually solicit wholesale accounts.
They would solicit cleaners who do not have the space, funds, or desire to do their own shirts.
The standard charge is usually about 75 percent of the retail price so the plant without a shirt unit can make a small profit and also accommodate its customers.
At the same time, the plant doing the wholesale shirts has to consider its cost and the cost of servicing the account and still make a profit.
The only advantage it has is that its overhead is charged off to its own retail shirts. All the other costs are the same, plus they have the added cost of a driver and the bookkeeping.
The cleaner who sends out shirts should also consider the hidden costs, such as labor at the counter both in and out and, if they want to do a good job, they should do their own inspecting, touch ups and button replacement, if any are broken or missing.
Shirts that retail at $1.50 and up are very profitable, contrary what anyone else may tell you, and can produce a much higher profit than routine drycleaning.
I'll be glad to take questions on this point if you care to write, call, e-mail or send a fax.
We are now seeing a return to chain stores by some new entrepreneurs. However, today it takes a prime location and lower than average pricing to do enough business to make this type of operation pay.
Back in my dad's day, he had to service 56 stores, plus wholesale, plus laundry and shoe repair to make a profit.
This state of the industry changed right after World War II when perc came on the scene and small plants were opening everywhere.
The chains couldn't compete with same-day service and the other benefits that were available with having a dedicated owner or manager on the premises.
The chains failed and so did the wholesale plants, but now there are new trends developing because of the ecological problems and the EPA that may change the face of the industry.
If I were 40 years old instead of 75, knowing what I know now, I would start a new concept of package plants without a cleaning machine or a boiler that could do everything except clean.
But I'm too old to start a new venture. However, if anyone would like to know my idea about how to become very wealthy in the drycleaning business, contact me and we'll talk.
As you can see, things change. They say the only things you can be sure of are death and taxes, but I'm adding "change" to the expression.
The future is loaded with opportunities for the strong minded, entrepreneurial spirit and people with vision. It always was and always will be.
Next month, I'll talk about agency drycleaning and that will conclude this five-part series.
I welcome questions about anything you wish to discuss and, since I have this forum, I will be glad to deal with your questions in future articles, either using your name or anonymously.
Stan Golomb is president of The Golomb Group Inc., a firm that designs marketing programs for drycleaners. Contact him at The Golomb Group Inc., 7664 Plaza Ct., Willowbrook, IL 60521; phone (630) 887-7339. His e-mail address is: stangolomb@golombgroup.comThis article has a long title, but it is an important issue. In the middle of July, the federal National Labor Relations Board ruled that non-union employees have the right -- upon request -- to have a co-worker present during an interview that might result in disciplinary action directed towards the employee.
For years, unionized employees have had the right to insist on the presence of a union representative during such interviews. This right, called Weingarten after the Supreme Court case that created it, is based on the section of the National Labor Relations Act giving employees the right to act "in concert" concerning working conditions. The rights to act in concert include the right to seek union representation. Thus, the Supreme Court concluded that the right to union representation at a disciplinary interview was afforded by the law that gives employees the right to unionize.
Now, the NLRB, the federal agency charged with enforcing the National Labor Relations Act, has ruled that the Weingarten right to union representation also applies to non-union employees wishing to have a co-worker present. The Board reasoned that because the Act applies to non-union employees as well as unionized employees, Weingarten rights should be extended to non-union employees. The Board's decision, which was not unanimous, undoubtedly will be appealed to federal court. Until then, however, it is the law of the land.
The NLRB, with federal court approval, has in the past extended the protection of the National Labor Relations Act to non-union employees. There is no need for a union to be present for an employee to picket his employer for wage increases, present a petition to the employer, or otherwise act in concert with other employees to change working conditions.
If a non-union employee takes such concerted action, and he is disciplined for it, the NLRB will issue an unfair labor practice complaint seeking reinstatement and back pay.
For the time being, if an employee is to be interviewed concerning circumstances that could lead to discipline, and he requests the presence of a co-worker, the employer should either grant the request or terminate the interview. There is no requirement that the interview take place, but disciplinary action cannot be based on the request for co-worker participation. If discipline is taken, it must be based on reasons other than the request, such as independent evidence that the employee engaged in misconduct warranting discipline.
If an employee requests co-worker participation and the employer intends to continue the interview, the request should be granted and the interview should proceed. The co-worker should be permitted to "advise" the employee, but the employee may still be required personally to answer questions concerning his conduct.
Under no circumstances, however, does an employer have to tell the employee of his Weingarten right. If the employee does not independently ask for co-worker participation, there is no requirement that it be provided or suggested.
In sum, remember that employees have certain rights to act together concerning working conditions without threat of reprisal, even when they are not represented by a union. Unless the NLRB is reversed, the right to act in concert includes the Weingarten right to have a co-worker present during a disciplinary interview.
One final word: If the purpose of the interview is merely to present a disciplinary decision, there is no need to grant a request for co-worker participation.
Frank Kollman is a partner in the law firm of Kollman & Sheehan, PA, in Baltimore, MD. He can be reached at (410) 727-4391. His firm's web site at www.kollman-sheehan.com has more articles and other information on employee/employer relations. The firm also sponsors a web site for human resource professionals at www.hrlawforum.com.Up to this point, we have described the pressing of suedes and leathers in great detail. Now to sum it all up, here are some key points to remember when pressing your own customers suede and leather garments:
1. Suedes are usually blown out on the form finisher and then, if necessary, pressed on the hot-head press to remove wrinkles.
As in cloth cleaning, pressing will usually result in a higher quality finish on a suede garment. However, fur lined sheep (shearing) coats and fur coats of any kind should never be pressed or steamed.
Form finishing suede
2. Smooth leather garments should always be pressed on a hot head press or a steam press equipped with a non perforated grid plate and hardly ever steamed on the form finisher.
Pressing leather this way not only removes wrinkles but it also restores the shiny, slick, soft, supple feel that is so characteristic of Smooth Leather.
Pressing leather
3. For best results, press suede and leather on a hot head press or a steam press equipped with a hot head grid plate. The hot head press should have a temperature not in excess of 250° F (120° C). This is accomplished by regulating the incoming steam pressure to the press down to 50 psl (3.5 kg/cm2).
4. Use a medium to high head pressure setting. Hold the hot head press head down hard for 5 to 10 seconds on each lay, with the vacuum on if necessary to prevent a build up of excessive heat in the skin.
After each lay, brush the nap of Suedes back and forth with the appropriate suede block brush to raise the nap.
5. Suedes may be pressed on a drycleaning steam press with no steam or, for much better results, with steam, IF the steam pressure is regulated down to 40 psi (2.8 kg/cm2). This reduced steam pressure can be achieved by installing a by-pass steam regulator on the incoming steam line.
6. When pressing, press the collar and lapels first. This requires one lay on each side of the collar and one on each lapel. Then press the front, side, back, other side and other front, making several lays. Next press the sleeves and cuffs on each side using sleeve pads to prevent creasing. This procedure will require 2 to 4 lays per sleeve.
7. The hand iron is a miniature hot head press which can be used to press suedes and leathers, if the temperature at the shiny face of the Iron is set at the rayon setting of 250° F (120° C).
If steam is to be used, it should be regulated down to 40 psi (2.8 kg/cm2).
Hand ironing leather
8. Finally, steam and press all loose linings as you would on a cloth garment.
If the lining is attached at the bottom, hand iron the lining with minimum steam pressure of 40 psi (2.8 kg/cm2) and a low heat setting of 250° F (120° C) which is the rayon setting on a steam electric iron.
Garments with attached man made fleece or pile (borg) linings do not require pressing except on cuffs, collars and pocket flaps.
Now that you are armed with the knowledge of how to safely press suedes and leathers, you should never again have to hand your customers a poorly pressed suede or leather garment!
Just follow this series of instructions and your customers will smile instead of frown because they will now be getting the quality of pressing they have come to expect from you on their suedes and leathers!
Frank Lucenta, president of Royaltone Co. Inc., is an aerospace engineer who Invented the Royaltone process and products that make possible his method of cleaning and finishing leather and suede. He also wrote related instruction books that document the process entitled, "Handling Leather and Suede" and "Cleaning & Finishing Leather & Suede." For more information, call (800) 331-5506, (918) 622-6677, or e-mail frank@royaltone.com or visit the Royaltone web site: www.royaltone.com.Whenever an employee asks for a raise it reminds me of a joke I heard that goes like this:
The employee comes in and says, "Boss, how come every time I ask you for a day off, you tell me how important my job is and that nothing would get done without me. But, when I ask you for a raise, you always tell me how unimportant my job is."
The boss says: "That's because you have to look at both sides of the argument. First, there's my side. And then, there's outside."
As humorous as that may be, the fact is, that wage and salary administration can be a tough job to manage properly. No matter how well this tedious task is handled, not everyone will be satisfied all of the time. The hard part is distinguishing between justified complaints and plain employee grumbling.
Some employees will never be happy with their salaries. Despite a fair increase, they don't feel it's ever sufficient.
"You only gave me a $25 a week raise. That's not much."
They seldom stop to consider that $25 per week is a $1,300 per year increase!
When employees come to you with salary complaints, like:
"I'm not getting paid enough for all the work I do."
"After taxes and deductions, my pay is too low."
"My friend down the street is getting more."
It's easy to brush them off with a quick comeback, like: "Well, that's all we can afford to pay you."
Remarks like that can end the conversation, but it doesn't mean the matter is over -- at least not for the employee. Whether true or not, the employee may feel that he or she has a valid complaint. Ending a salary discussion quickly may fan the flames of discontent even more.
Salary complaints should be handled the same way as any other employee complaint. Listen to what the employee has to say. Show that you care by saying; "Well, why do you think your salary is unfair?"
It may be just an opportunity for an employee to get the matter off his chest. While giving voice to the "logic," it may occur to the employee that some of his reasoning is weak. You can ask questions to encourage the employee to doubt his reasoning and weaken his justification for a pay increase.
It's usually best to avoid making any statements one way or the other. Don't accept or dispute any elements of the complaint. Just listen. Arguing cannot help the situation. End the session by letting the employee know that you will consider the matter.
Just say: "Let me think it over."
There is a good chance the employee will cool down in a week. Additionally, the delay lets the employee know that they do not have you over a barrel and that you are the one in control.
The delaying of a response weakens the employee's hand. It keeps him wondering what kind of response he will receive. During this time, they may even grow more receptive to a negative response.
As long as there was no commitment as to when you would respond, delay your response as long as possible. The longer the delay, the less justification is needed for your response, no matter which way the response goes.
During this period of consideration, you should closely monitor the quality of work being performed by the employee who feels he deserves a pay increase.
Pointing out deficiencies will weaken the employee's justification for an increase. It's best if this is done subtly, so as to seem casual and unrelated to other considerations. Keep it on a matter-of-fact level.
Don't go out of your way to find and exploit mistakes. Just mention those that are more or less obvious. Of course, the employee may realize what is happening. But it is, after all, your job to see that only quality work is performed.
At times, a response may be unavoidable. If this is the case, and you are not prepared to give a pay increase, you can give a "yes and no" answer. This will, at least, buy you more time to consider.
A good way to phrase this "yes and no" answer might be: "I can't justify a raise right now. However, I'm going to watch your performance closely in the next six (or whatever) months. Then we will see. I think that is fair."
By saying this, you have told the employee "no," but you have also given them something to look forward to. There is no commitment that a raise will be coming. Sometimes the potential for a raise is all that an employee really wants. If the request is justified, it will be a simple matter to prove it. This will allow you to give a raise when it is warranted, without giving raises to every employee who complains.
Dennis McCrory is affiliated with the Golomb Group, 7664 Plaza Ct., Willowbrook, Il 60521. He can be reached at (504) 236-3557.Decisions and contests make winners and losers. Winners are the happy ones and losers not so happy. Today, women are the happy ones. They are happy because new products and services are made with the woman in mind.
Today's woman is involved in virtually all activities. She does not fear machines of any kind. Yesterday's requirement for strength is no longer needed. The backbreaking working days are over. Knowledge and continual learning is the driving force for today's economy.
Women have the knowledge and want to learn more. They are more knowledgeable than women of the past generations. Today the working woman is no longer called the housewife. She earns more money, buys her own car, invests in the stock market and spends more money on things that she wants. She loves clothes; she is a smart shopper and spends money wisely.
The working woman is a busy person. Time is what she needs for relaxation and to be with friends. She needs help. She wants reliable service and good drycleaning. The drycleaner who can meet her demands will have a loyal customer. Those who cannot will be avoided.
The working woman is not taken in by TV commercials. She trusts her friends for advice. She won't be patronized nor fooled. She asks questions and she wants answers. She won't accept answers that are superficial.
Aside from her personal care, she is in charge of the entire household cleaning. She decides when drapes need cleaning and when it is time for upholstery and comforters to be cleaned. When advertising for more cleaning, make sure your ad talks to the working woman. She has enough stuff around the house to keep a drycleaner busy.
The informal trend in office apparel is frowned upon by many (Washington Times, June 21, 2000). The backlash against office casual is growing, not only in professions ,but also in the fashion industry, which has been bitten by a loss in revenue.
While experts have laid blame for the casual dress trend on the technology industry, others have pointed the finger at Levi Strauss for informing the nation's chief executives that more comfortable clothing aids in productivity.
Miss Manners, a well-known social arbiter, takes a dim view of dressing down at the work place. Jeffrey Magee, who heads an executive training company, says that casual work place attire could lead to a decline in ethics, morality and productivity, as well as an increase in what he describes as "gutter language."
Garment manufacturers and colorists are helping consumers get longer wear in between drycleanings by using stain resistant fabrics. Colorists are doing it with multi-color designs on fabrics so that stains can hide in the design. Now solid colors don't allow stains or dirt a place to hide, especially in the nasty, dirty ring-around-the-white-collars.
However, there is something that a garment can't hide even though you can't see it. That something is odor. We all know about odors. Some are fragrant, but most are not. We have experienced all kinds of odors by smelling. Consumers don't like to wear yucky, smelly clothes even when they look clean. Drycleaning keeps clothes from getting yucky.
It is not unusual for a drycleaner to hear this: "Go ahead and clean it. I want it freshened up." This should be another reason why odor removal should be part of our drycleaning service.
A seminar promoting drycleaning made this announcement in a trade newsletter: "How to get more money from customers."
This quote is more like stealing than getting. The statement is an insult to the drycleaner and reprehensible to the consumer. Drycleaners are tired of hearing, "Taken to the cleaners," and the one that says, "Drycleaners clean your wallet."
Drycleaners are interested in getting more business from people who need drycleaning!
The messages on trucks benefit the drycleaner -- they open the door of awareness that drycleaners exist. Then it is up to the drycleaner to take this awareness to the consumer and persuade him or her to use drycleaning services.
The truck message is not a novel way in promoting drycleaning. No one knows for sure when and where it started, but in the Washington, DC, and Baltimore area truck messages were seen with this message: "Clean clothes last longer." Bernie Leibow and Al Rogers, operators of Stadham Supply Company, started the message program 50 years ago.
There is no need for product providers to hide behind chairs or under the table, fearful to promote this program because they are skeptical of its success. They believe the program may not work and will be a waste of time, and that naysayers may object.
The truth is, doing nothing is a waste of time. The program has one objective and nothing more and that is to sharpen our image and get more people to use our drycleaning services. What's wrong with that?
Bill Bogus is president of Textile Restoration Services Inc. in Laurel, MD. He can be reached at (301) 776-4961.To make a living in the drycleaning business takes dedication and a lot of hard work. Being successful in the drycleaning business requires the ability to delegate to others, a full understanding of your numbers and the willingness to plan.
These three elements for success -- delegating to others, understanding your numbers and planning -- are intrinsically related to each other. Understanding your numbers and developing a plan of action for your business takes time. It is this requirement of time that necessitates the willingness to delegate authority and responsibility to others.
When I conduct one of my Business Surveys for a client, one very important aspect is interviewing key people in the organization. The majority of your employees want to contribute to and be a part of a successful business.
During this survey process, I always ask the owners to evaluate all key personnel. The owners who are afraid to let go of their complete control have one thing in common. These owners are not willing to allow any of their employees to make a decision. Every employee must go to the boss, Captain Control, with the most trivial of questions.
It is no surprise that these drycleaners have to close for a week if they want to take a vacation. Is Captain Control sooooo important that the company couldn't function without him or is it that he has done such a terrible job of hiring and training people that he is surrounded by total incompetence?
The real problem here is that the owner is afraid to let go.
There is no business owner who has ever been one hundred percent right in one hundred percent of the decisions they have made and we are all still in business. Guess what... if you are gone from the business for a day or even a week your employees will make mistakes but none of their mistakes will put you out of business. That is a fact!
Anyone who wants to build a business must learn to delegate authority and responsibility to others. The first step in this process is to start telling your key employees why you do the things that you do. That's right, start by communicating with them and educating them.
The next step is to take a day off from the plant without acting like the world will come to an end because you're not there. The following week, take two days off. This time would be well spent working on your numbers.
Learning your numbers
First, determine how much more capacity you can process in your plant before you have to invest heavily (over $50,000) in additional equipment or building space. If you have room to build the piece volume of your business, estimate by how much -- 40, 50, 60 percent? Whatever your estimate, it will be close.
The next step is to take last year's numbers, total sales and total expenses. Break out all your fixed expenses, the ones that don't change with sales volume: i.e.; rent, insurance, equipment leases, your salary, interest expense, advertising, depreciation, etc.
These costs normally run between 20 and 28 percent of sales. Typically, the profit margin after your salary will average between seven and eighteen percent of sales.
The profit spread of seven to 18 percent is dictated by one or a combination of the following three items:
1. High depreciation or equipment leases for companies less than five years old or for older companies that had to acquire new equipment.
2. High rents.
3. High officers' salaries.
Whatever the cause, approximately 20 to 28 percent of sales go to expenses that will not increase when your sales volume increases.
The remaining expenses fall into two categories -- variable and semi-variable.
One of the most unique aspects of the drycleaning industry is that there are very few true variable expenses. Hangers, packaging supplies and tickets vary directly with sales volume.
All of the remaining expenses, including labor, are semi-variable. The question is, how much will these expenses increase when your sales increase?
On average, over the course of 12 months, your variable and semi-variable expenses will increase 5.5 to 6.5 percent for every 10 percent increase in sales volume.
Remember, your variable and semi-variable expenses represent 60 to 65 percent of sales and your fixed costs represent 25 percent of sales. This formula only works when your company is operating above the break-even point.
Example #1
Let's look at average monthly sales and expenses for XYZ Drycleaners:
Monthly Sales: $40,000
Variable and Semi-Variable Costs: 26,000
Fixed Costs: 10,000
Total Costs: 36,000
Profits: 4,000
Example #2
Now, let's take the same company with a 10 percent increase in sales:
Monthly Sales: $44,000
Variable and Semi-Variable Costs: 27,560
Fixed Costs: 10,000
Total Costs: 37,560
Profits: 6,440
In the second scenario, profits increased by $2,440 to $6,440 for that month on increased sales of $4,000. This example (#2) reflects seasonal increases in sales volume, not sales increases that are the result of special promotions.
Example #3
Let's take a look at the bottom line when the sales increase is the direct result of a special promotion.
Utilizing your point of sale counter computer, you mail coupons to people who are not your customers. Let's say this is a 50 percent off coupon on four or more pieces of drycleaning. In this example, your sales increase $4,000 before you deduct the fifty percent coupon.
Monthly Sales: $44,000
Discount at 50%: 2,000
Net Receipts: 42,000
Variable and Semi-Variable Costs: 27,560
Fixed Costs: 10,000
Total Costs: 37,560
Profits: 4,440
In this example (#3) you increase sales by $4,000 for the month, but you increase profits by only $440 for the month.
What this means is that in order to build your business successfully, you must have an action plan, you must know what the results of this plan "should be," and you must monitor the actual results to the anticipated results.
Then and only then will you know what works for you and what doesn't work for you.
In the words of Mary Beard, "Action without study is fatal. Study without action is futile."
Remember, in the game of business the more you know the better you can play the game.
Alan Robson is a private consultant dealing with the specialized needs of the drycleaning industry. Readers are encouraged to send him questions he can address in future columns. For more information, contact him by telephone at (508) 753-6619 or send e-mail to him at: agrobson@ma.ultranet.com Editor's Note: This article originally appeared in the August, 1997, issue of National Clothesline. Al Robson is taking the month off. He will be back in control next month.
Copyright © 2000, National Clothesline Maintained by: Hal Horning