Linen Supply Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 530 linen supply services companies in the US provide laundered items, such as table and bed linens; towels; diapers; and uniforms, gowns, or coats, on a rental or contract basis. Companies provide linen products and deliver cleaned and processed linens as replacements for soiled linens. Large firms may offer related products and services, such as washroom supplies or janitorial services. Firms may also process customer-owned linens. Large firms may manage on-premise laundries for customers or free-standing laundry cooperatives.
Capital-Intensive Operations
Industrial laundries are capital intensive, and the ongoing maintenance of machinery can be significant.
Government Regulation and Certifications
Linen supply service providers and industrial laundries are especially vulnerable to regulations that conserve water and protect the environment.
Industry size & Structure
The average linen supply service provider employs about 100 workers and generates $7-8 million annually.
- The linen supply service industry consists of about 530 firms that employ 51,000 workers and generate $4 billion annually.
- The industry is concentrated; the top 50 companies account for about 72% of industry revenue.
- Large firms typically offer both uniform and linen supply and include Cintas, Aramark, and Alsco.
- Large firms with a focus on healthcare linen supply include Crothall Laundry, Ecotex Healthcare, and Mission Linen Supply. Several large firms in this sector are family-owned.
- Small firms typically operate within a limited geographical market.
Industry Forecast
Linen Supply Services Industry Growth
Recent Developments
Mar 25, 2024 - Employment Up, Wages Flat
- Employment by linen supply services rose in late 2023 while wages were flat, according to Bureau of Labor Statistics (BLS) data. While employment increased by 4.4% in December 2023 compared to a year ago, employment has yet to return to pre-pandemic levels. Wages at linen and uniform supply services were unchanged in December 2023 compared to a year ago. Industry wages have grown by 33% from December 2019 to December 2023. Consumer spending levels rose in the last half of 2023, with a 3.1% increase in the third quarter and a 2.8% increase in the fourth quarter, according to Reuters.
- Consumer confidence levels fell in February 2024 after increasing for three consecutive months, according to data from The Conference Board. The Conference Board’s consumer confidence index fell to 106.7 in February 2024 from 110.9 in January 2024. According to Dana Peterson, Chief Economist at The Conference Board, “The decline in consumer confidence in February interrupted a three-month rise, reflecting persistent uncertainty about the US economy. The drop in confidence was broad-based, affecting all income groups except households earning less than $15,000 and those earning more than $125,000.” Peterson added that the decline in consumer confidence was largest in householders over 55 and those under 35. Plans to purchase homes, autos, and large appliances decreased slightly on a six-month basis.
- As measured by the US Bureau of Labor Statistics' Consumer Price Index (CPI), laundry and dry cleaning services prices grew slightly month over month in December 2023 and about 5% year over year. Overall inflation increased 0.3% month over month in December 2023, seasonally adjusted, and 3.4% year over year before seasonal adjustment. The CPI measures the monthly change in prices paid by US consumers for goods and services. The year-over-year increase remains well above the Federal Reserve's 2% target for a healthy inflation level. The core CPI, which excludes volatile energy and food prices, increased 0.3% month over month and 3.9% year over year. The energy index rose 0.4% month over month and fell 2% year over year. Food prices grew slightly month over month and were up 2.7% from a year earlier.
- Linen supply companies will have to monitor minimum wage changes, as 22 states increased their minimum wages in January 2024, according to USA Today. About half of the increases are automatic adjustments linked to inflation. States that raised their minimum wages in January 2024 include Hawaii ($14), Maryland ($15), Nebraska ($12), and Washington ($16.28). Several states are set to boost their minimum wage levels later this year, including Florida (up to $13 in September) and Nevada (up to $12 in July). According to the Economic Policy Institute, nearly 40 US cities and counties will increase their minimum wage rates above state levels at the start of the new year. The federal minimum wage is $7.25 an hour, and more than 20 states, primarily located in the South and the Midwest, use the federal minimum as their wage floor.
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