When a hotel compares running its own laundry against outsourcing, the comparison is almost always unfair to the outsourced option — because the in-house side gets counted as "just detergent and a bit of electricity", while the vendor side is a single visible invoice. Once you build both stacks properly, the picture usually changes.

The full in-house cost stack

An honest in-house cost per kilogram has to absorb everything below. Most properties we speak to have never totalled more than the first two lines.

  • Labour — laundry staff salaries, PF/ESI, uniforms, supervision time, and cover for leave and attrition. This is usually the single largest line and the one most often left out.
  • Utilities — water, effluent handling, electricity for washers and dryers, and steam or gas for the boiler. Boiler fuel in particular is easy to under-attribute because it is shared with the kitchen.
  • Chemicals — detergent, alkali, bleach, sour and softener. The visible line, and typically the smallest.
  • Equipment — depreciation on washer-extractors, dryers, flatwork ironers and the boiler, plus the annual maintenance contract and the cost of downtime when a machine fails mid-season.
  • Linen replacement — the quiet killer. Aggressive in-house wash formulas and over-drying shorten linen life dramatically, and replacement is charged to a different budget line so nobody connects the two.
  • Space — the floor area the laundry occupies, valued at what that space could otherwise earn. In a city-centre property this is rarely trivial.
  • Management overhead — the hours your housekeeping head spends on rosters, breakdowns and chemical vendors instead of on rooms.

Where the crossover usually sits

There is no universal break-even, but the shape is consistent. Very large properties with steady year-round occupancy and existing plant can often justify in-house. Small and mid-size properties, seasonal properties, and anyone facing a boiler or ironer replacement decision almost always come out ahead outsourcing — because that replacement capex is the moment the true cost of in-house becomes visible.

The variables people forget

Occupancy swings

In-house laundry is a fixed cost against variable demand. You pay for the staff and the plant whether you are at 40% or 95% occupancy. An outsourced per-kg contract converts that fixed cost into a variable one — which is precisely what you want if your occupancy moves seasonally or your property runs on events.

Peak capacity

In-house capacity is sized somewhere between average and peak, which means it is wrong most of the time. Sized for average, you fail during a full house or a wedding weekend. Sized for peak, you carry idle plant for most of the year.

Linen life

Linen is a capital asset that a laundry either preserves or destroys. Correct chemistry, controlled wash temperatures, proper pH sour at the end of the cycle and — critically — not over-drying will extend usable life substantially. Over-drying is the most common in-house error: it feels like good practice and it steadily cooks the fibre.

How to run the comparison properly

  1. Total twelve months of actual in-house spend across every line above, including a fair share of boiler fuel and the space cost.
  2. Divide by twelve months of actual kilograms processed — weigh for a fortnight if you do not already track this. Most properties are surprised by the real figure.
  3. Add your annual linen replacement spend and ask how much of it is wear rather than loss or guest damage.
  4. Compare against a quoted per-kg rate that includes collection and delivery, and check what the vendor commits to on turnaround and shortages.
  5. Then add the one-off question: what capex is due in the next 24 months, and what happens to the comparison when you include it?

If you would like help building this comparison for your property, send us your room count, average occupancy and current linen spend and we will put the numbers side by side with you — including the lines that make outsourcing look worse, where they apply.