Charges for lost and damaged garments are not typically factored into initial budget estimates for uniform rental (“rental”) programs but in reality are almost always the most significant source of unexpected program cost. In fact, rental customers report paying as much as 20-30% in added charges for loss/damage – which can add up to $150 extra per person per year above and beyond their weekly rental costs.
As Chad Barker, Tyndale’s Regional Sales Director with over 15 years of past experience in uniform rental and laundry explains in the video (link below), loss/damage charges amount to both the purchase of a new garment at full retail price plus associated setup, name tag, logo fees, and sometimes replacement charges.
These charges are not only expensive, but can feel unfair because charges are not prorated based on how long the lost/damaged garment was in service or if it was originally issued used or new. This is problematic because:
- If the original garment was used for a long time, it is worth only a portion of its original value. PLUS, the weekly rental fees your company has paid through time have already paid for the garment in full – often several times over.
- Workers are typically issued brand new items at the outset of the rental contract. However, rental suppliers are motivated to keep garments in the system as long as possible to maximize profit. Accordingly, through time, garments returned by workers who left the company or changed sizes are retained by the rental provider and reissued – that is, issued in used condition – to subsequent wearers. Unfortunately, even if the lost/damaged garment was not issued in new condition in the first place, rental customers are charged full price for replacement due to loss or damage.
Let’s take a closer look at other common complaints around loss & damage charges:
Charges for Lost Garments
Lost garments are often the #1 complaint from workers in rental programs – negatively impacting customer satisfaction while driving up your company’s bottom line:
- Your company is invoiced to replace missing items, regardless of why an item can’t be located, who had possession of the garment when it was lost, and even if the missing garment is later relocated.
- As many as 50% of employees in rental programs opt not to use the industrial laundry service, and fail to return garments left at home for cleaning when they leave the company. This not only means your company paid all along for a service not rendered, but incurs significant loss/replacement charges for unreturned garments upon employees’ departure.
Charges for Damaged Garments
- Rental providers’ criteria for what constitutes “damages” is unclear.
- When items are returned after a worker leaves, changes sizes, etc., they are assessed for damage prior to laundering – while soiled. This can be problematic because an item that is simply dirty can be inadvertently identified as stained/damaged.
- Rental contracts typically state that customers aren’t charged for normal wear and tear, but in the absence of specific criteria for “damage,” wear and tear is often charged as damage.
- Damage charges are typically assessed by route drivers, who are not only rushed and busy but compensated based on the total revenue they generate – including revenue for loss and damage. This leaves little to no incentive to assess garments thoroughly or to invest effort in differentiating between damage and wear and tear.
View the video for a recap. Scott Margolin, Vice President of Technical, and Chad Barker, Tyndale’s Regional Sales Director with extensive experience in uniform rental, take a deep dive on rental program loss and damage charges:
What about Damage Insurance?
As an alternative, some rental providers offer an “insurance” or “protection” program. However, these programs have been reported to be as expensive, or even more expensive, than loss/damage charges assessed without such coverage.
- The program covers only damage (not abuse or loss), so protection is limited and assumes issues are correctly categorized by the provider – again, in the absence of clearly articulated criteria differentiating damage, abuse, or wear and tear, and customers are still charged for lost garments.
- Though pitched as a small charge, the insurance program often costs as much as $4-5 per person per week and therefore has significant impact on annual spend.
- If the rental provider feels damage is outpacing the customer’s “insurance” premium charge, they’ll adjust the charge to customer accordingly.
As a result of these challenges, there unfortunately are really no ways around charges for loss and damage in a rental program.
This is one more example why it’s critical to understand the details before signing a rental contract. Follow along with our series to understand other factors to consider before you sign on the dotted line.
Looking for a cost-effective alternative to rental for arc-rated and flame resistant clothing? Whether you need arc-rated or flame resistant clothing for yourself, a handful of employees, or an entire workforce, Tyndale has a next-generation solution for you that offers budget certainty and a host of other benefits. Contact us today to learn more.