Displaying the fibre percentages of textiles on garments is a mandatory requirement in the UK. This is specified in the 2012 edition of the Guidance on Textile Products (Labelling and Fibre Composition) Regulations.
These regulations state that information about the main fibre content of a garment must be displayed in percentages, e.g. 100% Cotton etc.,
Nightwear, babies, toddler, and small children’s clothing are required by The Guide to the Nightwear (Safety) Regulations 1985 to carry a permanent label indicating whether they meet the flammability standard BS-5722.
In this standard, the label requires KEEP AWAY FROM FIRE to be clearly displayed on the label and in red.
There isn’t a compulsory regulation within garment construction to require the display of the country of origin within the EU, but trading regulations insist that it is necessary to state this. However, there is no regulation for advice on the after care of the garment to be displayed and the inclusion of washing/dry cleaning instructions is not mandatory in the UK. If after care labels are attached it is recommended that the use of GINETEX symbols are the standard – the system used throughout Europe.
ISO 3758:2012 established a system of graphic symbols, intended for use in the marking of textile articles, and for providing information on the most severe treatment that does not cause irreversible damage to the article during the textile care process, and specifies the use of these symbols in care labelling. The following domestic treatments are covered: washing, bleaching, drying and ironing. Professional textile care treatments in dry and wet cleaning, but excluding industrial laundering, are also covered. However, it is recognised that information imparted by the domestic symbols will also be of assistance to the professional cleaner and launderer.
BS EN ISO 3175 is the standard for Identification of fabric and garment properties, which can change in cleaning and finishing. This standard is the expectations of dimensional and col-our change in any cleaning, drying, and finishing cycles that can be used by manufacturers as a measure of clean ability and therefore the selection of a suitable care label.
BS EN ISO 3175-4 is the standard for professional wet cleaning. The cleaner should be able to expect garments, that carry a care label, to have been manufactured and tested to the ISO Standard 3175 and that the garment care label is suitable for the garment it is attached to. Dimensional change is some-times progressive and a single process may give little indication of the extent of the change after repeated treatments, but with so many textile items, which includes garments, being made off shore there is a risk that testing is not perhaps as rigorous has it should be and this is why we see many that have care labels attached that are unsuitable and also the problem with many care labels is that they do not cover the entire garment including embellishments and adornments which may have been attached after the basic testing.
Loose colour, and colour bleeding, is another problem that gives cleaners concern and is on the increase because cloth dyers save money by reducing on rinsing out after colour dying.
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Digital is already today the weapon of the future. Enabled by digitalized processes we will see less stocks, more individualization and quicker response to market demand – also in corporate wear and linen services. The supply chain will be able to react much faster and much more differentiated on demand. The technology is partially already available. Since a few years digitalization has become a major topic in garment and textile production. Various conferences and summits have highlighted bits and pieces of hard- and software. Meanwhile solutions are consolidating and densifying to a degree, which will incubate new business models in garments and textiles.
Texprocess 2019 presented a couple of digitally controlled solutions like stitching with simultaneous yarn dying, 3D-design tools, virtual showrooms, raster image processing (RIP), automatic sorting and automatic transportation to assembly etc. The micro factories at Texprocess 2019, which followed the Texprocess microfactory 2017, displayed (a) a fashion line, (b) a technical textile line, (c) a smart textile line and (d) a knitting line. These production lines demonstrated live how their elements form a continous, digitalized process, which needed less than 45 minutes to produce from design to the ready-made product. The variety of production and product types hinted to an even broader range of applications in the future.
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ELIS is since some years – at least since 2016/2017, when they started the takeover of Berendsen – the most discussed textile service company in Europe and also in Latin America. The textile service community witnessed an aggressive growth plan, which has been totally out of the scope of medium sized laundries and family run textile service companies. The strategic super merger with Berendsen appeared as a bang, which changed the competitive environment in some markets drastically. and which is embedding the traditional business model of textile service companies into the larger framework of asset management and asset development.
We should not think that the ELIS challenge is now over, and all efforts are only focussed to integrate Berendsen and the other approx. 50 takeovers since 2016. In contrast to the textile service community, ELIS has strong financial genes, which are a permanent driving force for the development of the company. This financial driving force has been and will be exploited for a profitable ELIS development as service company for some time ahead. The potential is bright (a) in raising profitability of ELIS as a conglomerate of textile service companies, and (b) in improving the value of ELIS or parts of ELIS for private or institutional investors and (c) for share holders.
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There are 3 weeks until the 8th edition of JET EXPO Paris, the leading French fair for professional textile care, that will take place at the Porte de Versailles Hall 7.1, being organized by Messe Frankfurt France.
During JET EXPO, CINET will host a full program. Among the highlights of the program, The WOPCOM Experts Meetings will play an important part:
Sunday, May, 19th (14:00 CET) – Retail Textile Cleaning (RTC)
Monday, May, 20th (13:00 CET) – Industrial Textile Services (ITS)
WOPCOM – the World of PTC Community is an online platform of experts with a knowledge database on PTC, with a vast number of articles on best practices from numerous experts worldwide. CINET members are offered a free user account on the WOPCOM platform. Find out more about WOPCOM on this link. More about the registered WOPCOM Experts Meetings Agenda – here!
Apply now for the CINET Activities Program during JET Expo, on the Event Page (here) or via the CINET Secretariat, Postbus 10, NL-4060 GA Ophemert (e-mail: email@example.com, tel: +31 344 650 430)!
Sustainability is gaining momentum in Europe. Supported and often initiated by governments and non governmental organizations institutions and companies are establishing policies and parameters of sustainability for their economic activities. Thus sustainability is integrated in the parameters of economic success.
The importance of ecological and social values is increasing, although companies use them very differently. Sustainable efforts range from legitimation decor, possibly urged by supervisors, to fundamental missions of entrepreneurs and companies. Europe has all of that and many companies in between. However, social and ecological values are increasingly reflected and pursued in the society, which means at consumers, in political institutions and non governmental initiatives.
Increasing responsibility of textile services
Textile services are growing in health & care, tourism and also workwear. Hence the exploitation of natural resources is increasing, more waste produced, and also human resources are in higher demand. Thus the responsibility of textile services to use environmental resources, with preserving caution, and to enable acceptable working conditions mounts up along the value chain.
Textile services are in itself sustainable, because washing and repair enables multiple use of textiles. However, this is nowadays only a base, which can be improved in many respects, and which should be improved to increase sustainability. In a holistic concept, we see the following dimensions to act more sustainable
(1) energy consumption
(2) water consumption
(3) usage of chemicals
(5) sustainability of textiles rented out
(6) responsible conditions for labor.
Very many initiatives, projects and investments are done and on their way in these areas. Here we want to describe only in very broad terms where the efforts to act more sustainable in textile services are standing, and where they will thrive for.
Currently we see broadly two approaches in sustainability policies:
(1) increasing efficiency in using resources
(2) ban and substitution of harmful materials.
More efficient use of resources
Initially the companies were heading to reduce environmental burden by reducing the consumption or increase the efficiency of resources. Target is the reduction of environmental burden in a linear perspective according to the motive: „Less harm“. This was very successful in some areas. For example relative to the water consumption in the washing process, Dr. Stafan Vautrin, product manager at Christeyns, said: „Water consumption is in many applications extremely low so that we have reached a system barrier“.
Ban and substitution of harmful substances
The second line of sustainability policies is aiming at the integration of production materials and used textiles in a recycle process. This means: do not use materials and processes, which are harmful for environment or health. Motto: „No harm“. Target is to develop processes and use materials, which can be used again and again. Aim is a perfect, endless recycling of material. Textile services enable in this line of thinking an endless loop of use and reuse.
Future: total recycling
If you understand that urban resources are not indefinite, but finite, it seems logical that recycling ideally should be developed to a closed loop of materials. Thus the well known „Cradle to Cradle“ approach looks at waste and trash as material for the next loop in materials. To enable this next loop, the waste in production and at the end of the textile life cycle should provide high value material. Cradle to Cradle has defined for the recycling a biological cycle and a technical cycling process.
Most important insight of the Cradle to Cradle concept is that the design of the product and the production processes has to keep up front in mind to use only material and production processes, which allow for a high value recycling. Thus the whole textile value chain from fiber production to textile care and sorting for recycling at the end of the textile life cycle need to be controlled. For biological recycling attention is focused on regaining biochemichal matters and composting. The technical recycling process concentrates on maintenance, repair and reuse. Overall the target is to minimize loss of material, ideally to minimize the loss to zero.
Transparent value chain necessary
Fundamental base of this approach – as well as of other sustainability – concepts – is (1) that it covers the whole value chain from fiber generation to the end of the textile life cycle, and (2) the transparency of the value chain. Important questions are among others
– which fiber is biodegradable
– which chemicals have been used in the production, especially in dying and finishing
– are also the accessories of confection harmless for recycling
– are detergents and other textile care chemicals harmless for health and environment.
Albin Kälin, CEO, EPEA Switzerland and Cradle-to-Cradle Expert from Switzerland says relative to industrial laundry processes: „Typical washing procedures of laundries should have good chances for optimization towards high value recycling.“ However, the textile service companies and most of the textile production companies are only in early stages relative to the target of total recycling and circular economy.
But there are also pioneers on various stages of the textile value chain like:
– Lenzing with Tencel in it`s various applications on the fiber level
– Lauffenmühle with infinito and reworx as fabric supplier
– Dieckhoff with it`s production line „Denken.Fühlen.Handeln“ (Think.Feel.Act) as garment supplier. The respective supply along the value chain is growing slowly.
Circular economy: support from NGO`s and Politics
In general neither the whole economy nor textile services as an industry are really prepared to go via a circular economy. This holds even more in an international perspective, and that international perspective is essential, because the textile value chain is international. But some political institutions and non governmental organizations have realized the importance of a circular economy in the face of rising exploitation of natural resources.
Already in December 2015 the EU enacted an action plan for a circular economy. Aim was to develop the currently prevailing transformation economy to a circular economy like described above.This action plan is kind of basic, and includes among others decrees about packaging waste, electronic waste and a general European regulation. The EU has started a process with this action plan, and gave also concrete targets like:
till 2030 65 % of urban trash shall be recycled
70 % of packaging garbage shall be recycled
All plastc packaging should be enabled for recycling
Textile waste shall be collected separately form 2025 onwards etc.
Avoidance of micro-plastic
An important topic of the EU in the fight for high quality recycling is since 2018 the strategy for plastics in the circular economy. The increasing pollution of oceans and seas and the large amount of micro-plastic particles in the food chain of fish and mankind made the topic prominent. Plastic is only in the very long run degradeable and contaminates nature, animals and humans.
Textile services and micro-plastic
One of the important sources of microplastic particles are textiles made from artificial fibres like polyester. As polyester is one of the most often used materials for workwear and flat linen in textile services, textile services have a plastic problem. Even more as every laundry process yields not only cleaned linen, but also some abrasion as microparticles from polyester or other hardly degradable substances. The avoidance and substitution of polyester and other hardly degradable substances from an ecological perspective will be an important target also for textile services.
That will be a challenge to many textile service companies, because cotton/polyester-blends form a very important part of textile ranges in workwear and flat linen. Some companies like Dibella have startet to substitute polyester with recycled polyester, however that has limits.
REACH and BPR A large number of Initiatives and regulations aim at the reduction of harmful substances in the value chain. That is in harmony with the target of a circular economy without explicitly mentioning that. Among those are:
– REACH (Registration, Evaluation and Authorization of Chemicals) aims to improve the protection of human health and the environment through the better and earlier identification of the intrinsic properties of chemical substances. If substances involve harming hazards, their use can be restricted or totally banned. Introducing companies have to provide the relevant data.
– The BPR (Biocidal Products Regulation) regulates the market for chemical devices against harmful organisms like pests or bacteria. Those devices need approval and obey to handling regulations like compulsory labelling.
Science and practical application often lead to updated knowledge relative to the hazards of chemicals. If they are put on the list of hazardous substances at REACH like it happened for example with PFOA (perfluorooctanoic acid), this substance has to be substituted in many applications. Thus REACH and BPR are strong means to reduce harmful substances.
Non governmental initiatives
Out of the numerous non governmental initiatives we want to highlight here:
– the Zero Discharge of Hazardious Chemicals Foundation (ZDHC), which resembles more than 80 important companies and brands like Adidas, Inditex, C&A, Gap etc. Their target is a production without harmful substances up from 2020;
– the Sustainable Apparal Coalition (SAC), which has nearly all important brands as members. SAC ist currently with roughly 200 members the largest industry organization, thriving for an ecological and socially acceptable production.Many oft he members use the Higg-Index, which has been developed with the support of SAC, to evaluate their ecologic and social sustainability along the value chain.
These initiatives are setting milestones, which will reach out after some time also to textile services. ZDHC for example has developed a list of substances, which should not be used in production. Their Manufacturing Restricted Substance List (MRSL) has become an important reference in the textile chain, which has been also adopted by governmental actions like the German „Bündnis für nachhaltige Textilien“ (alliance for sustainable textiles), organized by the German government. Similarly the „Bündnis“ is in talks with the SAC to use their instruments and tools to document and develop sustainable actions of alliance members.
In general all levels of the textile value chain show various opportunities and necessities to improve sustainability towards a circular economy. We pick here some areas and examples to illustrate how comprehensive and differentiated the road to sustainability and to a circular economy is.
Fibreproduction as starting point
Crucial for the ecological quality of a textile is already the fibre production deployed, because that sets already some standards of ecological quality. And you might go here even for advanced differentiations in organic cotton. Dibella for example has developed a set of standards for cotton growing and harvesting, which leads them in their buying process.
In the perspective of the circular economy concept, the biodegradeability of the fibre is of utmost importance. Natural fibres and synthetic fibres based on cellulose as well as biopolymers are here advantegeous. The development of biopolymers like Polyactid for different categories of textiles is seen as a promising option. Also Reworx from Lauffenmühle can be rotted in a controlled process and is developed for workwear and other textile product categories.
Textile chemistry as challenge
Chemical substances are used more or less at all stages of the textile production. Especially important are they among others as seize for the weaving process, in dyeing and in many processes to functionalize the fabric.
For colours the textile dyers face since years the challenge, that dyeing substances are no longer offered, often because of their risk for human health or fort he environment.
Relative to functionlization the toughest challenge currently is to find a substitute for PFOA, which is only permitted up to 2020. PFOA bears risks for the liver and for reproduction. The substance is important for medical products, outdoor textiles, and weather protective textiles, because it protects against liquids, blood, and oil. Especially for oil protection is no solution at the horizon.
Finishing and washing
In the finishing area we see currently many approaches and projects, to improve sustainability. Important ones are ecofriendly, new dyeing techniques, digital priniting, laser technologie, plasma technology and spraying.
The laundry processes are characterized by a permanent process of resource saving: less water, less energy, less detergents, low temperature washing procedures, UV-C Technology, to name a few. Overall the washing processes has been heavily improved from an ecologica perspective. Albin Kälin, cradle-to-cradle advisor, sees good chances to optimize the industrial washing systems in the direction of a circular economy. However, currently there are no projects at textile service level known, which try optimize laundry processes with the vision to fit into an endless circular economy. „First we need to solve the problems in the textile chain“, said Kälin, „laundry technology comes next.“
In this article the business model of Laundry on Demand is analyzed through the perspective of B2B customer segments that professional textile care companies service. The key take-away of this article is focused on the opportunities of increasing market share for PTC by upselling to existing B2B segments and capturing new B2B segments that currently aren’t being serviced by professional laundries.
Laundry on demand defined
As described in the article ‘Modern Retail textile cleaning concepts…’ laundry on demand (LOD) is the label used to refer to an online laundry service where customers use an app on their smartphone to place orders and get their laundry done. The advanced laundry on demand platforms are much more than a simple app that enables customers to place an order (static process). They can cope with dynamic ordering (maximum flexibility) and focus on optimized, automated logistics and operations management. The system constantly calculates the best routes are based on real-time information (such as traffic) and available drivers. The focus of LOD is currently on B2Cmarkets but the first successful examples are observed in b2b markets as well. For instance, in some B2B segments the flexibility is of huge value, this will be elaborated below. Besides this flexibility the interesting part about the technology behind this platform is that the order process can be initiated by the actual wearer / end-user of the service in an automated manner. Lastly, every interaction on the platform is analyzed by using analytics so the user experience and marketing campaigns can be optimized. In this article the opportunities that are identified by players in the market will be described.
Laundry on demand in B2B
Market demand in B2B sectors of industrial laundry moves in the direction of mass customized services, delivering services to the needs of individuals in a fully automated way. For B2B it means meeting the needs not in particular of the company but of the individual end-users (the wearer or the person that uses the linen). Within the technology it is possible to organize logistics based upon GPS locations and automatically include personal preferences based on account settings (like wash temperature or folding/hanger delivery). Within these B2B segments there are numerous opportunities to grow the market and the technology of laundry on demand can provide solutions to capture that market share. The main challenges are:
Figure 1. main challenges for LOD in B2B market segments
The main challenge for industrial laundry is to develop added value for customers so pricing can go up. This is done by offering added value for instance with textile management services, distribution of textiles up to a complete in-closet service, offering additional functionalities to the wearer (bacteria repellant for instance) or extra comfort upon request. In line with offering new services laundries can use modern technologies which enable companies to service existing customers in a better way and service new market segments that used to be impossible to cater to. A good example are construction workers which need mobile textile services as they move around a lot. Another example is the market of elderly people that live longer at home or in small care wings with joint living formulas. These are currently not (really) being serviced by textile service providers but there are examples of experiments to develop and capture these kind of fragmented markets as well. In some segments this brings the larger industrial laundries closer to the small laundries and at times in direct competition. The suppliers in the textile care sector are continuously working on development of new technologies to enable mass customized services in the laundry. In a combination of data usage, individual batch tracking, machine learning, robotics and automation the smart laundry will increasingly be able to process according to exact customer specifications.
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What your exact cost price for each product (jacket, pants, etc.) is?
what the influence of an investment in new machinery on your cost price will be?
What the impact of hiring another employee will mean for your profitability?
The Cleaning Cost Model developed by the Dutch professional textile care association NETEX in collaboration with CINET will give you the answers to the above questions! This cost calculation tool for the textile cleaning companies provides insight into the cost of your company and the cost price for each product (total 6 products can be selected). As a user you can fill out the basic cost and production information about your business, subsequently the tool will calculate over the past period what your exact cost price and margin have been.
The Cleaning Cost Model includes 4 standard products: jackets, pants, shirts and coats but there is also room to add two articles of your choice such as sweaters, wash & fold or dresses for instance. The model consists of a number of input fields and behind the scenes the system will calculate the flow for each product. The input sheets are intended for the end user to fill in the required data and to make a selection per article from the cleaning and finishing processes. Calculations are then made on the spreadsheets to determine the cost price per item. The calculated cost price is then indicated on the export sheet in euros per item.
The tool is meant to provide insight into what a certain process does with the cost price of a product. Also you can determine the cost and impact of automation and calculate how many more products you need to receive to justify the cost of automation.
One of the major learnings from the tool so far is the insight of investment in new machinery vs. time spent on each product. When you buy more expensive machinery, the cost price will increase but much less significant compared to spending more time on the process (for instance the time spent on finishing or the amount of re-wash). This is important to notice as business owners often seem to value ‘time’ as less important than the ‘out of pocket cost’ for machinery.
The tool is free to use for CINET-members or you can acquire a separate license to use the tool.
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Textile cleaning services, especially dry cleaning, have justified their role from a major technical argument: many clothes cannot be technically laundered at home, but only in dry cleaning. Clothing with a so-called “P” logo was hence the realm of the dry cleaning. This technical imperative has lost in importance, mainly since people buy and wear less formal apparel. Another argument in favour of textile cleaning services has been convenience. This argument is merely sociological since convenience is closely related to the division of tasks within the household, the presence of house staff, the size of the house and the budget. While textile care was cumbersome till 1970, the dramatic improvement till this day of home laundry machines has made it highly attractive.
The technical imperative for textile cleaning services is not enhanced. Recent social trends have made the “convenience argument” more relevant. These social trends are related to changing ageing, composition of households, emancipation of women, costs of housing and attitudes to products and services and ownership of durable consumer goods. The potential market size in Europe for textile care service based on the trends above will be estimated on the basis of aggregate data on clothing sales in 2012. The convenience approach needs to activate new frames of thinking by consumers. This frame shall have to be reinforced by the development of a new service proposition.
The ambition of this document is not to provide a conclusive, highly documented and calculated market analysis. It is rather a document with some evidence that needs to inspire and to invite to explore an approach to the consumer, based on the understanding of major societal shifts.
2. Demo-economic trends in Europe
The convenience argument for professional laundry is fuelled by three trends: 1) an ageing population, 2) crisis and the impact on disposable incomes and 3) the housing/mortgage crisis. These three factors may lead to a rearrangement of household economics, which in turn creates opportunities for convenience services.
Ageing is an important trend in Europe. It is however composed of several components. In the first place because of improved living styles and health care, people live longer. And more importantly they live longer in good health. The average in Europe is around 80 years with men having a live expectation around 78 years and women around 83 years. Western and Southern European countries have slightly higher life expectations and a smaller gender gap than Eastern Europe. But the gender gap is declining, mainly because of better working conditions and less smoking and drinking. The other major trend is that the period of life in illness is declining.
In the second place, in many countries the number of children is declining. The so-called fertility rate (number of living births per women) does stand in Europe at 1.6 children per family. Only in France and Ireland this rate is above replacement. Besides these countries only Scandinavia, Benelux and UK have fertility above average and close to replacement rate. Hence in all other countries the population is likely to shrink. As often studied, the fertility rate is highest in countries with adequate child care facilities and a fair gender balance. In countries with traditional family patterns, fertility is lower.
A third dimension of ageing is in the financial consequences. A smaller share of the population has to support financially a larger group. This has three consequences. In the first place people shall have to work longer. This means a postponement of retirement age, a sobering of early retirement schemes. The consequence of this trend is that grandparents are less disposed to take care for the grandkids. The second is that the age group between 25 – 65 years has to cover the costs of retirement. Fewer adults have to pay for retirement for more elders. Finally, care schemes for elders are sobered. While medical assistance remains covered by public services, home services have increasingly to be supplied by family or by commercial services.
2.2 Crisis and Consumption
The crisis has a major impact in Europe. Only few countries, such as Poland, have hardly felt the crisis that started in 2008. For some countries, most notably Spain and Greece the impact will be long felt. Many countries, for example Germany, have reacted swiftly to the crisis have reformed and are back on the path of growth. However the largest part of Europe has hardly reacted to the crisis. There are not yet back on the growth track.
For retail and services the most striking element of the crisis is the depressing level of consumer spending. This is not particular to a specific consumption category, most are affected. Spending on clothing has declined in most European countries with levels in 2014 20% to 30% lower than in 2008. This decline is stronger in value than in volume, hence consumer do not buy less items, but they buy cheaper items (shirts instead of suits) and at a lower cost. The decline is even stronger in home textiles, replacement of curtains and of bed-linen is slowed down.
The decline in consumption is only a symptom of a deeper crisis that is visible in three phenomena. Only the elders have experienced a decline in spending power as retirement schemes have been sobered and pension funds make lower returns. Rising unemployment is the major reason for declining incomes. In some countries unemployment has equally affected both young and old. But in Southern Europe youth unemployment is at very high levels. This has also forced many youngsters to live longer with their parents.
The real cause of the crisis is a too high level of debts of households. These debts where often linked to the acquisition of houses, and the value of houses is now often lower than the nominal value of loans engaged. When possible households save or use disposable income to reduce their debt level. The need to reschedule loans is even higher when one of the partners loses their jobs or when a relationship ends in divorce.
Most economists agree that the crisis is not over. Even in those countries with an economic recovery, the growth rates are likely to be between 1% and 2% a year. This is much lower than the growth rates between 1992 and 2008. We have to adjust to a new economy and a structurally lower growth rate.
2.3 Housing and Debt Crisis
The housing crisis demands a specific paragraph, as it has consequences on the composition and activities of households. Since 99% of textile care is performed in laundry machines at home, this is a relevant dimension. The housing market is in crisis in the majority of European countries. This crisis is characterised by a number of dimensions:
Over indebtedness and negative equity of many house owners
Inadequacy of offer and demand for young and old
Rigidity of the house market (both rental and owned)
It is important to understand the consequences for several population groups. For young professionals there is no affordable housing offer both in rental and ownership markets in the form of small cheap apartments. In addition with youth employment above 25% in most European countries those with or without income have no access to housing nor to mortgages. The consequence is that young professionals stay with their parents until far in their thirties.
The second group affected by the housing crisis is the vast group of working adults in the age of 30 – 60 year. Often they have bought expensive homes in the period from 1990 to 2008 based on the expectation of rising incomes. They have relied on mortgages to acquire homes and are often in a situation of negative equity since the value of homes having dropped below the sum borrowed. They can only sustain if the two partners stay together and do both work. This brings about stress, and both a lack of money and of time.
The elders are in a relatively comfortable position, but they have to accept to get lees value for their houses than they expected and even need to complement declining pension revenues. Hence they postpone moving to smaller houses, better adjusted to a senior life style. On the other hand, in Southern European countries it is often the case that their children live at home far after having completed education and even having formed their own family.
The consequence for laundering is that many households do not have access to home laundry, do not have time for home laundry or do not want to launder any longer (for themselves or for their kids). An interesting dimension is that having a washing machine causes indirect costs in the form of house surface and hence mortgage payment. This amounts to some 2m2 which at an average price of 5000 Euro/M2 and an interesting rate of 4% amounts to 400 Euro interest payments a year.
It should also be noticed that alternative housing forms emerge. In general is the demand in Western Europe shifting from large family houses to smaller housing forms for singles or couples. This is very noticeable in larger cities where smaller households prevail. However both younger and older home seekers are looking for housing forms where they can share facilities. This is both for cost reasons, in order to reduce the amount of square meters and for the quality of facilities. These facilities may be physical such as energy provision, storage, and indeed a laundry room, or it may be care functions from a housekeeper till in house medical support.
Table of contents
The Challenge: introduction
Demo-economic trends in Europe
Crisis and consumption
Housing and debt crisis
Modern home economies
Price and value consciousness
Limitation of statistics
Scenario based forecast
Activate the consumer
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Ray Lambert: “Since leaving Jeeves a few years ago, I have kept an active interest in the business and whilst it is under different owners now I am delighted it continues to flourish especial globally through Jeeves International. The passion of Jeeves employees delivering service and quality consistently to its clients remains the same as it has done for many years.
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“Respect for customers & quality, because WE CARE”
The ambition of OXXO is crystal clear. Within 5 years OXXO should grow into the Starbucks of the drycleaning industry. Focal points in the concept are customer care and quality. In 2000 the European boutique style open air cleaning concept was brought to the US market by OXXO by opening the first store in 2002. Right from the start the business concept has a clear focus on environmental responsibility, convenience and automation, consistently implemented throughout its growth. Meanwhile OXXO has 60 franchises in the US and 10 abroad. The US operation is spread through the North-East part of the US, going from Texas all the way to New Jersey and Connecticut. We spoke to Mr. Salomon Mishaan, President and owner of International Cleaners Corporation (owner of the global OXXO Care Cleaners concept), about market position, trends, the OXXO business model and strategy.
‘WE CARE’ philosophy
As the name already explains OXXO Care Cleaners is an environmental conscious brand. Salomon is very passionate about this part, a franchisee really has to believe in the branding of OXXO, including the biodegradable solvent (Greenearth) and bags, recyclable hangers and best practices applied. Luckily, motivating franchisees to embrace this message worked out quite well for OXXO and proved to be one of the key success factors of the franchise system. OXXO is recognized repeatedly among the top US franchises in Entrepreneur magazine’s Franchise 500.
USP: store space
One of the interesting USP’s of OXXO is store space needed. ’An OXXO store needs less space because of the 24/7 distribution system of the garments. OXXO customers know this and hence come at any time’, says Salomon. A typical store size in the US is 250m2, an OXXO store is just 150m2, ensuring lower operational cost. The process is automated as much as possible using the latest technologies. After finishing there is no manual action needed anymore. A simple one-click on the button will bring the garment(s) to the counter or the 24/7 system.
Through automation OXXO stores just need a 150 m2 operating space
USP: embracing digitization & millennials
Another important unique selling point in the dry cleaning industry is OXXO’s position towards digitization and millennials. ‘We offer a convenient app for customers that facilitates communication with the customer and online orders. The UBER model and Airbnb are happening but the dry cleaning industry is not embracing these developments’ says Salomon. OXXO follows new tech and market developments (especially on millennials) and subsequently creates new concepts that meet the market demand of millennials. The result was the store model with 24/7 system with strict requirements for franchisees on environmental and social aspects. OXXO offers at home pick-up and delivery as well but it’s getting harder because customers seem to be less at home and leaving garments on the doorstep is increasingly not safe. Besides this, it is harder to provide a good quality service in the route model. As quality is one of OXXO’s major drivers as stated above, jeopardizing its brand image in this way is not the obvious choice. Therefore online orders with the routes model are being explored at OXXO. However this is not the pre-dominant channel. The same accounts for the locker model in apartments and offices.
Quality keeps customer coming back
In 2017 OXXO signed a partnership with NexoFranquicia for growth in Latin America. Salomon doesn’t see competitors so much in other franchisees. Convenience and reliability (the ‘we care’ philosophy) is the part which is important to drive these markets and this fits better in the model of OXXO. Quality keeps customers coming back, for instance with hand ironing that results in the best quality instead of using machines that have a lower standard. Furthermore OXXO expanded most successfully to Indonesia after a very specific inquiry of a likeminded entrepreneur in Surabaya, Indonesia. Other countries which are currently explored are Chile, Ecuador and the Middle-East. In the US OXXO is doing well, achieving growth where others are having hard times. The professional branding efforts of OXXO are one of the major contributors besides the USP’s described above.
‘We care’ philosophy for customers and quality
The future of dry cleaning industry will be changing. Salomon doesn’t foresee too much growth in the total US industry but the number of mom&pop shops will go down. Most of the Asian dry cleaners in the US have trouble to get their children to follow up in the business. New people that take over that want a franchise like OXXO because of its social and environmental profile, highly automated operations and modern service levels with consistent high quality. Acting upon these opportunities is a focal point for growth of the OXXO family.
The innovation pace in the industry is closely followed by OXXO and their model is on the front end of implementing new technologies. When visiting trade shows on professional textile care Salomon sees examples of innovations which they already have. Increasing the level of automation in the current situation would be difficult but OXXO keeps following the market closely.
For further growth more market share from the domestic washing machine will have to be taken, focusing on new textiles and changing dressing habits. The know-how on new type of textiles will need to be improved to make this happen successfully. It is important to notice in this respect that the US cleaners on average get some 700 garments per day (compared to European stores where 100 garments per day is quite normal). Salomon notes that the development of wet cleaning as an alternative to dry cleaning endangers this development as he believes it will result in more complaints and less trust in the professional industry. In terms of trends in textiles and fashion OXXO sees fast fashion is still around but slowly more high quality garments are coming back on the market. That for sure will bring the industry on track again.
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