Our industry is back on the track for recovery. 55% of American adults have finished vaccination and 65% have received at least one jab. Delta virus became a new threat but mainly to those who haven’t been vaccinated. There are lines to get into restaurants and shopping malls, wedding halls are busy taking reservations. Department stores really do not have fashion apparel inventory left to put on sale. Most of dry cleaners are back up to 70% and in rural and low-income areas, sales are often up to 90%. What concerns us the most is not the pandemic any more but our readiness to get back on the recovery trail.
Supply prices up due to pandemic
Pandemic shut down the factories of the world and it reduced the supply of raw materials. Hanger and poly prices have already gone up and so are the chemical prices.
Mr. Jay Hong from CleanAir Supply points out “a container that used to cost $3,000 to ship is now $15,000” and worries that “we have a double whammy of diminished supply and shipping cost increase.”
Mr. Fred Schwartzman fro A. L. Wilson Chemical said “Fire at a chemical factory has reduced supply of raw materials. Even though we managed to maintain prices, chemical prices have gone up as a result.”
Since almost all the hangers used in US is being imported, hanger shortage is likely to worsen during the summer with business picking up.
We are currently experiencing labor shortage. After letting go most of the staff during the pandemic, people are realizing finding new workers are a lot harder than before. This labor shortage is affecting the restaurants, general labor, beauty, house cleaning etc. and we now have to compete with other industries to find help. Wage increase is inevitable.
Nothing would be more frustrating than not being able to handle returning customers. Some cleaners are resorting to automation. A dry cleaner said “no equipment is more expensive than labor. If a new equipment allows me to work with one less person, it’s worth it.” He added “I had to choose automation since the labor shortage isn’t likely to go away anytime soon.”
Enforcement of perc machines
The only place where you can have a perc machine is self-standing building. Perc has been banned from a co-located building last December. Luckily (?) the pandemic held up the enforcement but it’s bound to start soon.
An industry insider noted “conversations with NY DEP often mentioned July. Even with the backlog, enforcement is likely to begin in September.”
One thing for sure in post-pandemic world is that delivery service is here to stay. We need to get a smartphone app, build up online presence and start pick-up and delivery service before business picks up too much.
Price increase is overdue
All these factors tell us a price increase is inevitable. The cost for labor, gas, supplies and online service platform has all gone up. Our cost will go up in the post-pandemic world.
The pandemic has put over 6,000 cleaners out of business. Those who are reading this article have survived the customer drought. Now customers are coming back and you don’t want to fall behind because of unrealistic prices. It’s time you asked if you are ready for the next boom.