As we’ve noted before, the time you spend managing a uniform provider is often too much time for too little change. Not only is it indirect spend, but it’s out on the tail of your indirect spend. More often than not, it’s a category that isn’t even under management. It’s one of those expenses that you have to deal with, and you do what you can to keep it under control. The service design of the industry generally accepts this status quo, and you – the customer – are left with very few options. In this post, we want to shed light on a slippery aspect of uniform rental services that reveals black swan activity – random billing events.
First, let’s establish: while there are answers to this problem, they are difficult to reach. We’re interested in starting a conversation that gives customers a framework for leverage – a way to reach those answers. If you’re trying to control indirect tail spend, you need all the leverage you can get. As you know, uniform program invoicing tends to be volatile – the spikes in cost are hardly ever foreseeable. They seem completely random. True, some of it is random. But some of it is structured randomness. What do we mean by this?
HINDSIGHT IS ALWAYS 20/20
As volatile billing events occur, it’s difficult to understand whether or not they are justified. If they are too difficult to explain away or you don’t have the resources to rationalize them, you tend to defer to your provider. Have you ever known a provider to try and explain away an unexpected charge? There is ALWAYS some kind of reason. More often than not, that reason is subjective. It can’t be backed by real data. Here’s where that structured randomness comes in: you ever notice that your driver or uniform service manager uses the same rationale for everything? “Well, our fuel prices went up.” “We’re just passing on the cost we’re incurring from rising insurance rates.” “Your guys just sometimes lose things in bunches.” “You’re paying about the same damage now as you were last year.” Sound familiar?
Let’s use a concrete, clear example of this. Let’s say you decide to switch providers. You give notice, the quit process begins, your new provider starts sizing your employees for their new garments, etc.. You go through the transition, you get a final invoice from your previous provider and, HUH?! The invoice indicates loss charges for 32 shirts and 19 pants. What!? How’s that possible? Didn’t see that coming? That’s part of the service design of the industry. It’s not random, it’s design.
DATA = LEVERAGE
Continuing the example above, it’s highly unlikely you’ve kept track of every single wearer’s garment inventory over four years. And it’s really, really unlikely you’ve kept track of replacements, damaged quantities, provider audits, etc.. Now consider the alternative. If you had hard data showing that, over four years, your employees had only lost 9 shirts and 8 pants, you’d be in a much stronger position to push back on the final invoice. You’d have leverage. You’d have power. How can your provider justify lost quantities that are statistically nearly impossible? Moreover, how could your provider justify those losses when as recently as three months ago THEIR very own audit showed nothing was missing from inventory? See? Do you see it?
Random billing events do occur, but there is a way to validate them when they do. We want customers to know that there IS a way to manage your provider. There is a way to create transparency. There is a way to make things better. If you feel like your uniform provider is the black swan in your spend management portfolio, it doesn’t have to be that way.