Some uniform rental providers charge you extra for “non-standard” size garments. Did you know that? Do you know what those non-standard sizes are? Don’t worry, it’s too much detail for you to have to manage effectively. But it does matter. And while you can’t control the sizes your employees wear, you can control WHEN and HOW those sizes impact your bottom line. The point of this post is really simple – don’t believe any provider when they try to justify substantial rate markup because of the size of a garment.
Let’s start with an easy but useful example. Go to the website of a clothing store you like. Gap. H&M. Nordstrom. It doesn’t really matter. Look at the prices of items and switch the size selector from the smallest to the largest. No matter the naming convention – from XXS to 3XL, from size 1 to 15 or from 26×26 to 46×36 – try to find different price points in the spread. Do you see any difference? If so, how big is the difference?
QUESTION THE PRICING MODEL
It’s likely you’ll have a tough time finding a price difference amongst the different sizes. And if you’re thinking, “well, of course not, that pricing model isn’t necessary for such inconsequential cost difference, and it’s too complex to manage,” then you’d be thinking logically. Now look at your uniform rental agreement. If you happen to have a provider that publishes the non-standard sizes, you’ll notice that they probably didn’t print the rates. They just indicate, “there will be an extra charge.” It’s likely your agreement is missing both the sizes effected and the applicable rates. There are two problems here.
First, why are they even charging extra for smaller or larger sizes? Do you see anyone else that sells garments doing that? Or just providers who rent uniforms? While it’s generally the case that smaller and larger size SKUs represent low volume, this shouldn’t be used to justify the substantial rate differences customers pay on those items. Those differences? Anywhere from 30-100% higher over the standard rate. Yeah – 100% in some cases!
THE RATE ON A NON-STANDARD SIZE COULD BE MARKED UP 100%???!!!
Would you pay 30-100% more on a website for a shirt that was 3XL? No. You wouldn’t. But it’s likely that you are paying your uniform provider extreme markups for such low velocity SKUs. So what can you do about it? Unfortunately, you can’t do much if your contract currently allows it. However, you can start to give yourself leverage by maintaining the data and understanding how these costs compound over time. When it comes time for renewal, you want to use the data to create negotiation leverage. There is a way to significantly reduce cost on non-standard sizes, but it requires sophisticated knowledge of how a uniform rental invoice works. Why pay extra for something when it adds no value?