[Cost Guide] Understanding The True Cost of a Uniform Rental Program
Comparing prices for a uniform rental program?
Much like used car sales, the world of uniform rental programs can be confusing and full of misinformation.
A uniform rental program is typically a 3-5 year commitment, so make sure you do your homework, call references, and ask the right questions before signing on the dotted line.
This guide will help get you started.
How uniform rental pricing works
There are two ways a uniform rental company will typically quote you on their program.
- BILLING METHOD 1: Unit price + Ancillary Fees
The first method is the most common in the uniform rental industry. It involves a low unit price per garment, plus a series of ancillary fees like damage fees, repair fees, prep fees, and emblem application fees. These fees can represent over 25% of your total cost. In addition, managing and budgeting for your program can be difficult when a significant portion of your cost is unpredictable and difficult to track.
- BILLING METHOD 2: Total Annual Cost
The second way a uniform rental company will quote you is a total annual cost that includes all of the ancillary fees.
Both methods are usually invoiced “per service,” which means you receive an invoice each time clean uniforms are delivered to your facility. The most common billing frequency is every week.
Imagine You Are Buying Tires
To explain the difference between the two billing types, imagine you are buying new tires for your car.
Store A advertises a brand and size of tires for $80 each and Store B has the same tires for $100 each. You choose store “A” and plan to save $20 per tire. What a deal!
You sign the paperwork and wait in the lobby. When you get the bill, you are expecting $80 X 4 = $320 plus tax. As you review the bill, you see:
$4.00 per tire for valve stems ($16 total)
$5.50 per tire to mount them ($22 total)
$9.50 per tire to computer balance them ( $38 total)
$6. 00 per tire road hazard warranty ($24 total)
$5.00 tire disposal fee ($20 total)
$10 shop supply fee (compressed air, mounting lubricant, computer balance machine maintenance, etc.)
Total bill is now $320 for tires plus $130 extra charges = $450
Happy with your new tires, but disappointed with the final total cost, you call Store B and tell them you would like to get the total installed cost of the exact same tires for your car. The representative on the phone says the tires are $100 each and there is a $5.00 per tire disposal charge. “Total $420.”
You ask, “What about mounting, balancing, road hazard warranty, etc.?”
The representative says, “It is included in the price of the tire. After all, the tires would not do you any good if they weren’t put on the car.”
ITU AbsorbTech is like Store B. We call it StraightUp!™ Billing.
8 Secrets about Uniform Rental Programs
It’s important to ask the right questions when shopping around for a uniform rental program.
The billing tactics explained below are not used by every uniform provider. However, being aware of these tactics will help make you an informed consumer.
Loss & Damage
Loss fees are fees charged for uniforms that disappear from the inventory after a certain period of time (oftentimes taken home by a wearer). Damage fees are fees charge for garments that are turned in with a rip, tear, or other damage to the garment.
Some uniform companies use loss and damage as a means of offsetting low unit rates. Don’t agree to a low garment unit rate without understanding exactly how loss and damage fees will be assessed.
As employees lose, destroy, or change sizes, garments are sometimes pulled from a used inventory. If that used garment suffers the same fate, a charge for replacement may be assessed. Don’t accept being charged full replacement value for a garment if it was never new in the first place. It’s like paying a new car price for a used vehicle; it doesn’t make sense for the customer.
Don’t get assessed for damaged garments that aren’t actually damaged. Ask to verify and visually inspect any damaged garments before a fee is assessed.
Be wary of an extremely low unit price negotiated with a vendor. The price concession may be offset by fewer garment upgrades and replacements. For example, a garment that is supposed to be proactively upgraded will stay in rotation for 4 to 5 years. This is long past its useful life, resulting in a poor image for your organization.
Adding a Wearer
Uniform rental programs are extremely beneficial in areas of high turnover, allowing you to easily add and remove wearers from the program. Get a quote in writing on what the cost will be for adding a wearer to the program – prep fees, emblem fees, etc.
The cost to add and set-up a wearer in the garment program is typically waived when you start a new program. However, any garment wearers added after the initial install can come with a hefty price tag.
Clarify the vendor’s policy on fee changes, and get it in writing. If there is no limit on fee or unit rate changes, you could be subject to a price increase in as little as thirty days after signing the service agreement. This includes the ancillary rate charges.
Inspect a sample invoice and make sure it is formatted so that charges and fees can be easily audited. For example, damage and loss charges are easier to audit if they are listed in one location instead of by wearer.
Be observant when evaluating sample garments to ensure they truly represent what you will receive. They may be treated with fabric softeners or other additives that are not truly representative of how the garment will be processed.