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Should Hoteliers Rent Or Own Hotel Linens?

Should Hoteliers Rent Or Own Hotel Linens?

Outsourcing laundry may be a better choice for a hotel’s profitability and sustainability, but questions arise over whether it’s the right move for branding and maintaining sufficient linen inventory. Linen services can be at least as effective as on-premises laundries (OPLs) in providing both of these key benefits if the hotel is matched with the proper outsourced service alternative—whether renting linens through laundering services, or laundering only, which the linen service industry calls “customer-owned goods” (COG) service.

Because both rental and COG service can accommodate high thread-count sheets, heavy-plush towels, duvet covers and inserts, and pillow shams, either is a viable option for hotel operators who see high-end quality linens and towels as an important part of the guest experience. One difference is that renting enables hoteliers to avoid the challenges of owning linen, and eliminates the risk of linen shortages or shipment delays from textile product manufacturers or distributors. The same combination of products purchased from such suppliers is typically available from laundries in several “linen collections” that meet guests’ expectations and the hotel’s budget.

Below are some other considerations for hoteliers comparing rental or COG linen services.

Par Levels
COG service may be the better choice for hoteliers with unique product needs whose team is equiped to handle inventory management. A hotel must own several par levels to ensure the proper supply in the hotel is sufficient while some inventory is at the laundry. Outsourced laundries can assist in tracking and informing hotels when it’s time to replenish.

“There is a direct correlation between the hotel’s occupancy level and the poundage that the laundry will have to process daily. Volume from each account may vary every day due to annual seasonality (summer versus winter), type of guests staying at the hotel (transient, business groups or families), special events happening in the city and even weather. Understanding the demand pattern from each customer is central to the management of a laundry plant’s capacity and to the efficient allocation of resources,” notes Pablo Lucchesi, Managing Partner, Crown Linen LLC, Miami.

This service is especially valuable when items are lost or misused. “Usually hotels have to budget for washcloths and hand towels to ‘walk out,’” says Harry Kertenian, vice president, Magic Laundry Services Inc., Montebello, CA. “We really don’t get much of a linen loss on the bedding. But it’s important to budget for high-loss items correctly to account for times when you run out of these items faster than you normally would.” Otherwise more deliveries are needed and existing inventory will be used more, wearing out sooner.

Service Levels
The strongest COG providers excel in separating individual customers’ inventory for laundry processing and delivery. Avoiding such mixing is a key factor in achieving efficiencies that make outsourcing an economic win-win for hotels and laundries.

Another consideration is the service providers’ delivery time periods, as some may be able to provide special deliveries on weekends. “That is absolutely paramount. They have to work seven days a week,” says Jack Morgan, senior editor, Textile Services Magazine. When you’re in an inventory pinch after a busy end of the workweek, you should be able to get a Saturday morning pickup of your textiles for laundry processing and redelivery on Sunday morning.”

Whether a hotel chooses COG or rental, both outsourced laundries should be well positioned to provide other textile products and services needed to serve guests and employees, including front-of-the-house uniforms, dry-cleaned uniforms, high-end napery, and chef coats.

Demand Is Booming
Despite today’s economic challenges, luxury textiles are here to stay. Demand for these products and services is booming. The market in the hospitality sector is larger than ever and it’s evolving quickly. Whether COG or rental, this is a premium offering. More expensive textiles cost more to purchase and process than less expensive counterparts but still not as much as operating an OPL. This fits the classic formula for hotel profitability—delivering powerful amenities at a low cost that improve customer service and help hotels achieve a higher average daily rate.

 

About the Author
Joseph Ricci is the president and CEO of TRSA.

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