IFI's Bill Fisher: Drycleaning Industry Shakeout

An industry shake-out has begun, said IFI CEO Bill Fisher. For some cleaners it will spell doom. For others, it means better days ahead.

Fisher offered that forecast for the industry during a talk at the Southwest Drycleaners Association Big 2002 Show and Convention in San Antonio, TX, last month.

The coming shake-out will not be as dramatic as the one experienced by the industry in the 1970s, he said. That one saw the number of drycleaning plants decline from 31,000 down to about 19,000 by the mid-1970s. Since then, the number of plants has grown and is back into the 30,000-plus range. But that growth trend is reversing.

There is less work coming into drycleaning plants now as casual wear, and to a lesser extent, home drycleaning, have taken a toll, he said. It’s not unusual for cleaners to report that their volume is off 10 to 15 percent in the last year, Fisher reported.

“Poorly managed marginal operators will be going under and the work will end up going to other plants,” he said.

The survivors who will be around to pick up that work will be those who have well-run plants, provide consistent quality, pursue diversifications and keep garments coming, Fisher said.

To that last point, Fisher said that drycleaners need to “aggressively pursue the market for casual wear.”

So far, the casual wear market has gotten away from cleaners. Fisher cited a survey by the Rowenta Company, a maker of high-end home ironing equipment, that shows consumers believe “you don’t take khakis and casual wear to the drycleaner.” As a result, iron sales are up and home ironing is up nine percent. Furthermore, only 12 percent of the people surveyed work for companies that require traditional business attire.

“These are people who can afford these expensive irons and they are ironing more at home due to casual wear,” Fisher said. They should be drycleaning customers and drycleaners need to aim for that market.

Adapting to a changing market is not the only factor that cleaners need to consider to ensure their future. Regulatory and technical issues also require attention in order to make good decisions.

Fisher noted several areas on the regulatory front that need to be watched, particularly by cleaners using perc. The U.S. EPA Air Office is considering additional emission standards that could affect cleaning plants that are co-located in buildings with residences or schools. Fisher said that EPA has met with IFI, the Neighborhood Cleaners Association and the Halogenated Solvents Industry Alliance on the issue.

When the Clean Air Act was passed in 1990, IFI saw to it that language was inserted into the congressional committee report saying that this type of additional regulation would be unnecessary. Now that EPA has been reminded of that, Fisher said he does not believe it will pose a big problem.

A problem could develop for perc cleaners in Southern California if the South Coast Air Quality Management District goes through with a plan to phase out perc. The regional air district held a hearing last fall on a proposal to phase out perc by 2011. Hundreds of cleaners attended to protest the action.

Subsequently the SCAQMD has indicated that it might extend the phase out schedule through 2018. Further discussion of the proposal by the air board has been delayed several times since the first of the year, but the proposal is on the table.

Drycleaners in Los Angeles, Orange, Riverside and San Bernardino counties would be affected if the rule change goes through and those with older equipment might need to buy new within two years if the plan passes. Also, cleaners looking to buy new cleaning equipment could be required to go with a non-perc alternative.

Even if the perc phase-out is adopted in Southern California, Fisher said he does not see “a widespread movement in the rest of the country” to follow the California example.

Meanwhile, there has been a positive development on the government regulatory front in the form of a report issued in February by the North Carolina Department of Environmental and Natural Resources.

The DENRC report, which surveyed the industry’s cleaning solvent options, concluded that perc, as it is currently used in drycleaning, does not post a significant health hazard and that further regulation is not necessary.

“The North Carolina report is the best we have seen on perc,” Fisher said.

Regardless of what government regulators decide to do — or not do — concerning perc, Fisher said he expects that the industry’s most widely used solvent will continue to take a beating in the media.

If for that reason — or any other — a drycleaner decides to move away from using perc, alternatives are available and developments are continuing. Fisher provided an overview of the current perc alternatives.

In a case of “back to the future,” some cleaners have been shifting from perc to petroleum solvent, he noted. It was petroleum solvent that came to the rescue of the industry in early years of the last century when it replaced highly flammable gasoline.

After World War II, the conversions from petroleum to perc began, but even at its lowest ebb, petroleum remained the solvent of choice of many cleaners.

Now the tide is rising again, driven not only by increasing regulatory pressure on perc but also on improvements in petroleum solvents, which are now safer to use because of higher flash points. EPA dropped plans for further regulation of petroleum drycleaning solvents two years ago and there is nothing on the regulatory horizon at this time.

Fisher cautioned that cleaners switching from perc to petroleum need to be aware that solvent maintenance is important and that the potential for environmental contamination is reduced but it is not eliminated.

“Don’t get sloppy,” he warned.

Also making a comeback in cleaning plants is wetcleaning. Fisher said that modern wetcleaning technology makes it possible to a plant to handle 25 to 40 percent of its volume in water. With the addition of tensioning equipment in the finishing department, that could go as high as 80 percent. Ninety percent is possible, he said, but he sees no future for 100-percent wetcleaning.

Several totally new drycleaning solvents have appeared over the past few years. Rynex, which debuted at the 1995 Clean Show, has attained limited use in the industry so far, Fisher said, and he doesn’t know what its future will be.

Also making its industry debut that year was liquid carbon dioxide. Several companies are making carbon dioxide cleaning machines now, but Fisher said its success hinges on the development of detergents and additives.” There is also some problem of wrinkling of linings,” he said. “But I believe these problems can be overcome.”

More recently introduced to the industry was GreenEarth, a silicone-based solvent. It has almost no toxicity and can be used in current petroleum machines if the water separator is adequate. GreenEarth, too, needs further development of detergents, “We are seeing promising results with new detergents,” Fisher noted.

As for the most recently introduced solvent, PureDry, Fisher said there is not enough information to make an evaluation.

Overall, Fisher said he foresees a slight decrease in plants using perc, a continuing increase for petroleum solvents and wetcleaning, moderate to large growth for GreenEarth, and moderate growth for carbon dioxide. The future for Rynex and PureDry is uncertain.