September 11, 2006
Stories
Report Shows TRSA Members’ Sales, Profitability
Increasing Sharply
2005 was a good year for TRSA members.
Revenue grew significantly in 2005, with members’ sales
increasing by 7.9%, according to TRSA’s latest Industry
Performance Report. This is the second year in a row the
annual study of TRSA members showed a 7%-plus growth
in business. But unlike 2004, when profitability was similar
to the prior year, the 2005 report indicates that the pre-tax
profit margin went up 2.6%.
Healthcare textile services particularly fueled growth, with
operators in this sector reporting sales increases of 15.7%,
more than double any other segment. But the challenge in
healthcare remains increasing profitability, which stood at
3.8% as compared with an industry-wide members’
average of 6.8% according to the 2006 Industry
Performance Report. Typical industrial textile service
companies in the TRSA member study reported the best
profitability, 10.9%, however sales were down .4%. Typical
linen suppliers saw a 7.5% boost in revenue with a pre-tax
profit margin of 3.5%.
The Industry Performance Report, sponsored by TRSA’s
Strategic Management Committee, surveys members on
their finances and provides benchmarking data for
operators on both balance sheet and income statement
items. The survey is conducted by a third party, The
Mackay Research Group, and TRSA never sees a
company’s individual data. In the new report of 2005 data,
more than 25% of TRSA’s member companies participated
in the study.
Plant operations remains the most dominant cost center in
terms of percent of sales revenue, 37% in 2005, though
that is a decrease from 38.4% in 2004. Reduction in the
cost of labor expense – down 1.2% from a year ago – was
the primary reason, indicating a continued trend of
automation in member facilities.
As expected, increases in energy costs were evident. Fuel
oil and natural gas expenses rose to 3.6% of sales, up .3%,
as compared with 2004. Electricity costs were stable.
Delivery costs were up .6% of sales, mostly driven by the
increase in gasoline and diesel; members reported
spending on average 1.9% of sales on vehicle fuel.
2006 Industry Performance Report Now Available for
Purchase
The new benchmarking study is now available for sale in
digital format. The cost of the report is $300 for members
and $1,200 for nonmembers. To order, e-mail George
Ferencz at gferencz@trsa.org; mention that you read about
Right Column
TRSA Calendar
October 8-11, 2006
Managing Maintenance Institute
Lansdowne, VA
Contact: Bill Mann
Registration: View/Download
October 25, 2006
Webinar: Restroom Products
TRSA Online
Contact: George Ferencz
Registration: $25 – E-mail: gferencz@trsa.org
November 9-10, 2006
Healthcare Seminar
Las Vegas, NV
Web site: View
Contact: Bill Mann
Registration: View/Download
April 20-26, 2007
Production Management Institute
Denton, TX
Contact: Bill Mann
June 11-14, 2007
Clean ‘07
Las Vegas, NV
Web site: View (www.cleanshow.com)
Contact: George Ferencz
Fed Business Opportunities
This Month’s Textile Rental
September Issue Picture
the Industry Performance Report in Textile Rental Weekly
and receive a 10% discount. You can also order by phone
by calling 877/770-9274 or via TRSA Online.
One-Week Special: Save $50 on Healthcare Seminar
and Get the Information You Need to Succeed
The demand for knowledge about the healthcare sector in
our industry is strong and is evidenced by the high number
of operators signing up for TRSA’s Healthcare Seminar in
Las Vegas, Nov. 9-10. Nearly 100 attendees already are
taking advantage of this event, which is designed for those
who are experienced in the sector and those trying to make
their way into it.
TRSA recognizes that education and training is crucial in
this market segment and the association wants to see all
textile service companies doing or looking at processing
healthcare to be at the Healthcare Seminar. To that end,
TRSA is offering a one-week special, reducing the
registration cost $50. If registered by Sept. 15, the first
registration fee for a member company is just $349 and
additional company registrants can attend for just $299.
Guests of operator members can also attend for $299.
Nonmembers pay $424 for this limited time special.
The seminar features a comprehensive educational
program on the marketing and processing of healthcare
textiles for hospitals, medical professional office clients and
surgicenters. Topics will explore micro-fiber products, OR
packs, pack room operations, textile service industry
benchmarking, how hospitals don’t fully quantify energy
costs, and much more. Attendees will benefit from both the
general and breakout sessions – allowing them to select
the issues that will best help their company.
In today's rapidly expanding healthcare market, operators
can't afford to miss a comprehensive opportunity to learn,
expand and improve their bottom line.
For more information including hotel discounts, visit TRSA
Online, or contact Bill Mann at bmann@trsa.org or
877/770-9274.
TRSA Urges Congress to Support Fair Competition
A vote on H.R. 2965, The Federal Prison Industries
Competition in Contracting Act, is expected on the House
floor this week. H.R. 2965 seeks to address the Department
of Justice’s (DOJ) self-generated authority by making
explicit the clear intent of Congress to protect non-inmate
workers from unfair competition provided by the sale of
inmate-furnished services (including industrial laundry
services) in the commercial market.
In letters to member of the House of Representatives
delivered today, TRSA President and CEO Roger Cocivera
urges Congress to pass H.R. 2965 that carefully limits the
circumstances under which prison services may be sold
into the private sector economy. TRSA encourages you to
send a letter or call to your member of Congress. Click
here for a sample letter.
TRSA also wants to provide Members of Congress and
their staffs with examples of our members' loss of
business to state and/or federal prisons. If you have
examples of contracts being lost to state or federal prison
industries, please e-mail a paragraph describing that
situation to Michael Wilson at mwilson@trsa.org or fax it to
703/519-0026.
Congress Returns to Face Packed Legislative Agenda
Last week the House and Senate returned from the August
Congressional recess with plenty left on their plate. With
only a dozen or so legislative days left before members of
Congress head home to campaign for the Nov. 7 elections,
top unfinished items include: immigration reform,
permanent estate tax repeal, minimum wage increase
along with small business health plans.
Political analysts believe tackling comprehensive
immigration reform in the remaining days of this Congress
is unrealistic. Therefore, they believe that Republican
leaders will attempt to address this issue before the
elections by beefing up funding for border security and
work-site enforcement in scheduled votes on national
security. As far as permanent estate tax repeal, Sen. Jon
Kyl (R-AZ) the lead GOP negotiator on the estate tax,
cautioned last week against reviving an identical bill that
failed by two votes in July. He said changes should be
made, although not necessarily to the estate tax portion
because that did not appear to be the key to passage.
Despite Kyl’s reservations, Senate Majority Leader Bill Frist
is reportedly still working to fine acceptable language to
pass before adjournment.
Minimum wage is another hot issue on the Hill. Many
Republicans in vulnerable districts are pushing the
leadership to bring a minimum wage increase measure up
and pass an increase. Republicans from the Northeast
such as Reps. Peter King (NY) and Nancy Johnson (CT)
believe Republican leaders have to be careful to avoid the
perception that they did not make a good-faith effort to
raise the wage.
Rep. Deborah Pryce (R-OH), who chairs the GOP
Conference faces a tough election fight herself, has
indicated that she believes the leadership should hold a
separate vote on legislation combining the minimum wage
increase with small-business healthcare plans.
ICE Raid on Laundry Nets 26 Arrests
A U.S. commercial laundry, not a TRSA member, recently
was raided by Immigration and Customs Enforcement (ICE)
officials who forced a two-hour plant shutdown before
arresting 26 employees of Mexican origin on immigration
charges.
The plant owner told a local media outlet that all of his 90
employees had completed I-9 forms as required for all
workers in the United States. He added that an agent
investigating the company had said he would provide a list
of employees with suspect immigration papers within 60
days.
Instead, agents clad in bulletproof vests descended on the
plant with a search warrant and immediately began
interviewing and later arresting employees suspected of
immigration-law violations.
A spokeswoman for ICE declined to comment on the raid,
citing an ongoing investigation of the company. However,
she said the owner could face fines if he is found to have
knowingly hired illegal immigrants. The arrests followed an
audit of the company’s I-9 forms, according to news
reports.
Judgment Favors Cintas Workers in Invasion of
Privacy Case
A federal judge ruled in favor of nine Cintas employees
Aug. 30 in their case against Unite Here for violations of
federal privacy laws.
U.S. District Judge Stewart Dalzell said that by using an
employee’s license plate number to get home addresses in
order to solicit employees was illegal. The federal Driver’s
Privacy Protection Act forbids the release of personal
information from driving records except in certain
circumstances, which Dalzell rules was not union
organizing.
Each plaintiff was awarded $2,500 plus attorneys’ fees and
expenses.
Unite Here President Bruce Raynor, however, was
excluded from the case by Judge Dalzell. The employees
had tried to tie Raynor to the “tagging,” but Dalzell ruled
there was insufficient evidence to prove that connection.
Cintas President and CEO Scott Farmer said the decision
was “a tremendous victory for our employee-partners as
well as all workers across the country.”
Garment Corporation of American Names New CEO,
Management Team
Joseph I. Shulevitz, Chairman of the Board of Garment
Corporation of America, has announced the appointment of
Randall G. Kominsky as the new chief executive officer and
president of the uniform manufacturing company.
During the past several years, Kominsky, 51, has served as
a consultant to several companies in the textile industry and
was a member of the Board of Directors of Cone Mills. A
former partner in the accounting firm of Coopers & Lybrand,
Kominsky will oversee all aspects of the company. He was
also employed by Ryder System, Inc. for nearly 15 years as
their assistant general counsel primarily responsible for the
operations of Ryder Truck Rental, a multi-billion dollar
division.
"Randy comes to us with over 25 years of expertise in
helping companies grow,” says Shulevitz. "We have
tremendous confidence that he will bring a fresh outlook to
GCA which should help our customers become more
profitable and benefit our suppliers and employees.”
Shulevitz also announced the hiring of Frank Wells as chief
operating officer. Wells, 42, will be responsible for the
company’s overall production and manufacturing. Wells has
managed a staff of more than 2,000 people in the Olympic
Village for the 1996 Atlanta Olympic Games and has
provided strategic management consulting to numerous
companies while employed by Coopers and Lybrand.
Edmund Rumowicz, who first joined GCA in 1994, has
been named director of marketing and sales. A founding
partner and executive vice president of Galey & Lord until
his retirement in 1993, Rumowicz has more than 35 years
of industry experience. He is an adjunct associate professor
of textile marketing at the University of Rhode Island. He
has worked for DuPont and Burlington. Rumowicz will be
responsible for implementing a new sales program
designed to benefit GCA customers.
Marketing Vice President Lloyd Bennett has announced his
retirement from the company.
Former GCA President David J. Shulevitz, who has been
with the family-owned company for more than 25 years, has
stepped down from his position in order to pursue new
business ventures. However, he will remain on the Board of
Directors and will serve as a consultant to the new
management team.
Dryer Maintenance Important to Efficiency; Learn More
at MMI
Dryer preventive maintenance is keeping dryers as efficient
and productive as the day they were installed, and at the
Managing Maintenance Institute (MMI), maintenance
supervisors, engineers, support employees and plant
managers can learn how to do PM right.
PM for dryers begins by following the manufacturer’s
maintenance guide. Daily PM should include keeping the
basket perforations clean, cleaning the lint collectors and
cleaning of all photo eyes and switches. Students will also
learn at what time in the life of the dryer to perform other
PM functions. This includes at 200 hours, checking all drive
belt tensions, lube bearings and support wheels; cleaning
blower and blower motor grill clean the temperature probe;
adjusting burner flame (blue flame); and, most importantly,
check all safety devices.
David Bernstein from Consolidated Laundry Machinery will
give an in-depth presentation on dryers at MMI 2006. MMI
gives maintenance personnel a better understanding of
their role in improving plant operations and company
profitability.
MMI will be held at the National Conference Center (NCC)
in Lansdowne, VA, which is near Dulles International
Airport. NCC provides hotel accommodations, classrooms
and dining areas all in one location. Registration begins
Sunday, Oct. 8, at 5 p.m., followed by orientation and
presentations starting promptly at 7 p.m. The official
program ends at approximately 9 p.m., Tuesday, Oct. 10,
following the graduation reception and dinner. Registration
fee is $1,895 for TRSA members. Nonmember registrants
will pay an additional $300. Fees cover accommodations,
meals, class materials and classroom fees.
Can You Afford Not to Provide Complete Restroom
Services? Cost-Effective Webinar Shows How
Restroom products remains a mostly untapped market for
many member companies, but TRSA is providing a way for
textile service companies to offer this value-added service
while also staving off competitors from getting a foot-hold
with their existing customers.
TRSA will hold a Webinar Oct. 25 will offer an overview of
the restroom products market, including cloth towels,
automatic urinal and toilet cleaning and deodorizing
systems, urinal and toilet floor mats, urinal screens,
feminine hygiene vend systems, toilet seat covers, toilet
tissue and paper towel systems, toilet seat cleaners and
more. Apart from adding sales and being of greater value to
your customers, remember that most of the restroom
services provide over 60% gross margin after paying for the
products used.
The Webinar will offer many tips on expanding existing
restroom service programs.
Attendees can log onto this seminar right from their facility
or on any computer with a high-speed Internet connection.
The cost is just $25, a bargain when considering the nearly
two hours of industry specific information attendees will get
without the cost of travel.
To register, simply e-mail George Ferencz at
gferencz@trsa.org. Registration is limited to just TRSA
members. Hurry, seats are limited.
State Watch
VA Repeals Estate Tax
On Aug. 28, the Virginia General Assembly approved
legislation endorsed by Gov. Tim Kaine (D) to repeal the
estate or “death” tax in the state. The law (HB 5019, SB
5019) will eliminate Virginia’s tax on estates of individuals
who die on or after July 1, 2007.
Study Says Proposed Minimum Wage Increase will cost
MO businesses $44.4 Million
According to a study conducted by the Employment
Policies Institute (EPI), proposed legislation in the state of
Missouri to increase the minimum wage would place lowskilled workers out of jobs while simultaneously costing
$44.4 million to Missouri businesses. To read a summary
of the findings of the report and/or download it in its
entirety, please click here.