Distributors Say Janitorial Strikes Cause for Concern
Unions efforts to secure health care for Boston janitorial workers make for a difficult sales environment
More than 10,000 Boston janitorial workers, members of the Service Employees International Union (SEIU), recently went on strike in an attempt to gain full-time jobs with health coverage. According to SEIU, janitors who work in the Boston area earn significantly less money than workers in other big cities around the nation. Regardless of whether or not the strike is justified, it has proven one thing labor issues can definitely impact a distributors bottom line.
Obviously, were trying to sell new products, and right now the cleaning industry is so busy with trying to resolve the labor situation, they dont have time to think much about buying new products, said Steven Kolodny, sales manager for Boston-based Premier Supply Co.
The strike has been a thorn in the side of most distributors and wholesalers in the Boston area, said Kolodny. Its a concern for everyone. We do a lot of business with contractors, and when a strike is going on, thats all theyre thinking about. My sense is that most of them are just laying low as far as buying supplies goes.
Many distributors empathize with the janitorial workers situation. However, they are striving to keep their own businesses running.
I feel that anyone who does a good job deserves to be respected with decent pay, said Leslie Weinfeld of Edison Chemical Co., another distributor in Boston. We work more with purchasing agents than with cleaning contractors, so it didnt affect us as much at first. I hope it gets resolved soon.
The Union originally protested against Boston cleaning contractors, but then took a stance against Bostons building owners as well. According to SEIU, real estate companies, such as Equity Office Properties, Bostons biggest landlord, employ janitors who receive health care and other benefits in Chicago, Philadelphia, San Francisco and New York City.
I dont know if its all just propaganda, but the Union started running a big advertising campaign on television, telling citizens that other cities take care of their janitorial workers and provide health care, said Weinfeld.
Cleaning contractors, such as UNICCO, were a target of SEIU from the beginning. Victor Munger, vice president of UNICCO, responded to criticism by saying that fliers distributed at one SEIU rally were recycled from campaigns in other cities. Whether they work in-house or for a BSC, health care remains the biggest sticking point in negotiations.
Health care costs an arm and a leg. Theres no way we can afford it on the salaries our companies are offering, said Antonia Corbada, a part-time janitor.
Since late August, SEIU made a concerted effort to rally support for janitors in the Boston area. After organizing strikes in other major cities, Union officials said that public awareness was critical to keeping the attention of those companies that hire janitors.
Distributors who sell in a strike-torn city face not only abstract barriers in capturing the attention of buyers, but also physical barriers.
Anyone who is a teamster guy is going to be hesitant to cross picket lines, says Kolodny. A lot of truck drivers who make deliveries for distributors are teamster guys, so they most likely wont want to make a delivery, even if a sale is made. As everyone knows, theres a lot of pressure when it comes to picket lines.
Most Boston distributors are optimistic that building owners and BSCs will be able to reach an agreement with janitorial workers soon.
You cant just stop cleaning buildings, said Weinfeld. I just dont think people will put up with it if their buildings arent being cleaned regularly and professionally.
Stora Enso to Cut 500 Jobs
The Finland-based paper giant, Stora Enso, recently announced plans to increase production at some facilities in Wisconsin and Canada, while closing others and eventually eliminating 500 jobs.
The company said the move would increase profitability for its North American operations, which have had disappointing results since Stora Enso bought Consolidated Papers Inc., Wisconsin Rapids, Wis., for $4.4 billion.
The company said that job cuts would be phased in over the next three years and would result in a total of 2,000 eliminated positions, a decrease of more than 25 percent of the companys overall employment.
Stora Ensos CEO, Jukka Harmala, cited the prolonged downturn in the North American paper markets as the reason for the loss of jobs.
Letter to the Editor
As a distributor, Im still waiting for an honest, unbiased discussion about end users and the ISSA show. I certainly didnt get it in SMs August issue.
Distributors have been told not asked what their opinions should be on the issue. If we even question the matter, we are dismissed as fearful, old dinosaurs that see the glass as half empty (inferred in Allen Ratheys Fair Game? article). Im tired of being told from ISSA and their mouthpieces that this is really a good thing for us so we need to stop whining and get with the program.
As I said, Im still waiting for an honest discussion. Your editorial states that the Fair Game? article talks to some positive distributors and a couple who arent. In fact, only one distributor against end-user attendance is talked to (Bunzl), and they are given much less ink than those in favor. Why dont you poll distributors and print the results? I guarantee you the majority of distributors are unhappy to some degree.
ISSA can pretend that there is no problem if they want to, but come mid-October, my employees and I will be sleeping in our beds at home, not Caesars Palace.
United Solutions Group, Inc.
Georgia-Pacific Corp., Atlanta, recently announced that it has delayed the planned spinoff of its consumer products and packaging division, citing weakness in the financial markets and its building products segment.
Orange Glo, Greenwood Village, Colo., recently announced it will launch a professional products division dedicated to the industrial and institutional markets.
Advantage Marketing Associates (AMA), Chicago, has announced the election of its new officers: Hal Wolken (A.W. Mendenhall) has been elected president; Chuck Wuttke (CSB Industries SW) is vice president; Charles King (Garland C. Norris Co.) is treasurer; and Paul Roberts (Vernon Sanitation Supply Co.) is secretary.
The Freedonia Group, Cleveland, predicts that the demand for enzymes in the United States will increase 6.7 percent annually to $1.6 billion in 2006, according to a recent report. The increase is expected to be fueled by the commercialization of high-valued, enzyme-based products.
Intuit Eclipse, Shelton, Conn., has announced that it has become a Texas A&M University ERP/Distribution Benchmarking Process participant, as part of a newly developed initiative to help standardize a number of key business processes in warehouse distribution.
The National Association of Wholesaler-Distributors (NAW) distribution Research and Education Foundation (DREF) and Pembroke Consulting, Philadelphia, recently announced the release of Facing the Forces of Change OUTLOOK 2003. The book features a collection of insights from 11 of the wholesale distribution industrys leading strategists.
The International Sanitary Supply Association (ISSA), and the Cleaning and Hygiene Suppliers Association (CHSA) have formed an international partnership designed to encourage trade between the United States and the United Kingdom and to deliver enhanced services, benefits and educational products to members of both associations.
The Environmental Protection Agency (EPA) announced a new campaign to help boost recycling from 30 percent to 35 percent nationwide by 2005. The campaign includes 68 projects selected by the EPA and includes special focus on metal and plastic containers used in commercial industries.
The Occupational Safety and Health Administration (OSHA) recently announced restructuring and realignment of its internal organization. The reorganization features the creation of a new Office of Small Business, which will be part of an overall change in OSHAs structure to better address the specific needs of varying businesses.
The Department of Transportation (DOT), has issued a final rule which amends the federal commercial drivers license program. The amendment, issued by the DOTs Federal Motor Carrier Safety Administration (FMSCA) attempts to ensure that only safe drivers operate commercial motor vehicles.
President Bush recently signed Executive Order 13272, which requires federal agencies, when writing new laws and regulations, to protect the interests of small businesses. The Order also requires that they submit within 90 days their plans on how small businesses have been taken into account in the process of creating regulations.
Mergers and Acquisitions
Ecolab, St. Paul, Minn., recently announced that it has acquired Terminix Ltd., London, from ServiceMaster, Downers Grove, Ill. Terminix is a commercial pest elimination/property service company serving the U.K. and Ireland. The company grosses $65 million annually.
SCA, Stockholm, Sweden, has acquired companies in Spain and the United States. In Spain, the company has acquired packaging company Bertako for EUR 17.5 million. In the United States, SCA has acquired Packaging Resources, Denver, for $6 million. Packaging Resources manufactures customized packaging, primarily for the electronics industry.
Mercury Floor Machines, Englewood, N.J., has been acquired by Bill Allen, owner of Hawaii Care & Cleaning Inc., a building service contractor in Kukui Grove, Hawaii. Mercury was formerly owned and operated by three generations of the Karp family. Most recently, Peter and Annie Karp served as upper management for the company.
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