BINGHAMTON —– Mother Nature has a way of getting our attention. In 2006 and again in 2011, the Southern Tier was inundated by two, 500-year floods. In 2011, 20,000 residents were ordered to evacuate the Binghamton area when the Susquehanna River crested at more than 25 feet — 11 feet above flood stage. The […]
BINGHAMTON —– Mother Nature has a way of getting our attention. In 2006 and again in 2011, the Southern Tier was inundated by two, 500-year floods.
In 2011, 20,000 residents were ordered to evacuate the Binghamton area when the Susquehanna River crested at more than 25 feet — 11 feet above flood stage.
The 2006 floodwaters forced Lourdes Hospital to shut down and evacuate its patients.
“The flood of 2011 really got our attention,” says Brian Kradjian, president and CEO of Bates Troy Healthcare Linen Services, located on Binghamton’s near west side. “Our company provides critical services to area hospitals, nursing homes, and clinics by transporting soiled health-care textiles to our plant and delivering clean linens on a timely basis. These health-care facilities generally operate 24/7, so we need to ensure an adequate supply. We felt an obligation not just to our customers but also to other area facilities faced by an emergency.”
After the 2011 floodwaters receded, the Bates Troy staff began discussing options to guarantee that its plant would always be operational.
“In July 2012, we filed a New York State Consolidated Funding Application, which was supported by a partnership of the New York State Energy and Development Authority (NYSERDA) and Empire State Development (ESD). Our application met the standards set by Gov. Andrew Cuomo’s initiative calling for the next-generation energy system that is clean, resilient, and affordable for all New Yorkers.
Distributed power
Bates Troy opted to purchase a combined heat-and-power system, also known by the names “cogeneration” or “co-gen.” The system is capable of producing enough power for the company to operate its plant completely off the electric grid, even during sustained power outages,” Kradjian told CNYBJ at the unveiling of the co-gen system on May 27.
“The system is comprised of four, 100-kilowatt Tecogen Inverde units capable of producing a total output of 400 kilowatts. That’s enough capacity to support 80 homes. The Tecogen units generate electricity and simultaneously capture the waste heat to help produce hot water. We’re very proud that it’s the first micro-grid in the region,” he says.
A micro-grid is a small-scale power grid that can operate independent of or in conjunction with the main electrical grid. David Garrison, CFO of Tecogen, notes that the four units installed at Bates Troy are inverters, which take DC energy and convert it to AC power of any voltage or frequency. Each unit is powered by a 454-cubic-inch Chevy engine.
“The micro-grid concept is the best way for us to keep Bates Troy running 24/7 and guarantee the support our customers demand. That’s job-one. Secondly, the concept of distributed power offers us a substantial cost-savings,” Kradjian says. “We’re a small player in this industry, and we need to be competitive. It takes a lot of energy to heat enough hot water to clean 30 tons of laundry daily. And finally, this company has a long record of protecting the environment. This investment reduces pollution from electric generation by more than 50 percent.”
Ron Kamen, CEO of Earthkind Energy, who also spoke at the unveiling of the Tecogen system, noted that Bates Troy will generate about 90 percent of its daily electricity off the grid. In effect, the utility becomes the back-up to the Bates Troy co-gen system.
To finance the purchase and installation of the co-gen system, ESD provided Bates Troy a $380,000 grant payable over three to five years, and NYSERDA offered a $594,000 grant. Bates Troy invested approximately $700,000, supported by a loan from Tioga State Bank. The $1.67 million total does not include taxes, certain fees, interest, or miscellaneous peripheral costs. This investment follows a $4.5 million capital investment in 2008 that included an expansion of the building and the purchase of equipment.
“The co-gen investment has allowed us to extend our geographical reach from 90 to 120 miles,” asserts Kradjian, “and to hire an additional 25 employees. The company’s goal is to add a total of 55 new jobs. We now service Central New York, the Southern Tier, and Northeast Pennsylvania as far as Wilkes–Barre.”
The business and its origins
Bates Troy has two business lines: Bates Troy Healthcare Linen and Bates Troy Quality Dry Cleaning, a dry-cleaning, tailoring, and fire- and water-restoration business. The company dates back to the 19th century when Otis Bates opened Bates Steam Laundry downtown on Court Street. In the early 1900s, Bates merged with the Troy Laundry and relocated to Laurel Street. In the late-1940s, two Armenian immigrants, Kenneth and Arthur Kradjian, who started in the dry-cleaning business as the owners of Ballard and Ballard, bought Bates Troy. In 2007, the company was one of the first laundries nationwide to be accredited by the Healthcare Laundry Accreditation Council. Brian Kradjian is the third generation to lead the family business.
Today, Bates Troy operates from a 63,000-square-foot plant at 151 Laurel St. and maintains three retail Binghamton outlets for its dry-cleaning business. The company employs 104 and maintains a fleet of 11 trucks. The property on Laurel Street is owned by the company. The stock is held by the Kradjian family. The Business Journalestimates that Bates Troy generates $10 million a year in revenue.
The commercial laundry industry is a $19 billion national market. According to Kradjian, “New York state consists of 7-10 laundries, of which Bates Troy has a dominant market share in the Southern Tier and in Central New York.”
Being creative
Against this background, Kradjian observes, “[w]e are a small business compared to our competitors. To compete, we must be both creative and innovative and be flexible and responsive to the needs of the 30 institutions [3,000 patient-beds per day] we serve locally. The investment in the co-gen system is primarily a response to our customers’ concern for back-up to guarantee our service 24/7. Second, our strategy has always been to control our costs and to pass the savings on to our customers. Third, Bates Troy is a leader in protecting the environment, for example, through water-saving measures and by recycling rather than generating waste which needs to be disposed. Finally, our growth has been measured and is the result of long-term relationships. Bates Troy sees itself as a strategic partner with its customers: their success is our success.
“The plan for growth is to reinvest in technologies that are both green and cost-efficient and to focus on organic growth by offering more services to our existing customers and by reaching out to new customers. One avenue to acquire new accounts is to convince nursing-home OPLs (on-premise laundries) to outsource their linen service to avoid the growing capital investment required of OPLs and to focus on their core business — providing health care to their patients. I am optimistic that Bates Troy will grow 10 percent this year as well as next year.”
Kradjian credits Bates Troy’s success to its employees, many of whom have been with the company for decades. He also cites the leadership team which, in addition to himself, includes Ara Kradjian, vice president and COO; Thomas J. Singe, general manager; Randy J. Widrick, sales and marketing manager; and James M. Rheinheimer, plant manager. Kradjian also recognizes support from Bates Troy’s professional service-companies: Tioga State Bank for financial services, legal counsel from Hinman Howard & Kattell, LLP, and architectural/engineering support from Keystone Associates, LLC.
Going green
Bates Troy prides itself on going green. “We are the only dry-cleaning company to receive the 4 Eco Leaf distinction awarded by the Green Cleaners Council,” exclaims Kradjian. “That’s not just for Broome County; it includes Upstate. On the laundry side, we received the “Clean Green” accreditation from the Textile Rental Service Association for our efforts to voluntarily reduce the company’s environmental footprint. We are also a two-time recipient of the Broome County Legislature’s Green Business Initiative Award. Since 2011, Bates Troy has partnered with BAE to test the fuel economy of a delivery truck powered by a new propulsion system. We have cut our consumption nearly in half since installing our new tunnel washer and our efficient driers save both natural gas and electricity. We even introduced “Green Cleaning” garment tote-bags in our dry-cleaning stores to reduce the use of plastic bags. I’m very proud of the company’s environmental record.”
Bates Troy also takes pride in its long-term relationship with ACHIEVE, a not-for-profit organization formed in 1952 to enhance the quality of life for residents of Broome and Tioga counties who have intellectual or developmental disabilities. “Since 2001, we have partnered with ACHIEVE through Country Valley Industries (CVI) located in Johnson City,” Kradjian points out. “Bates Troy supports 100 individuals at CVI to help us inspect and fold 2 million pounds of clean linen annually.” Achieve and CVI named Bates Troy the 2009 Company of the Year.
CEO’s background
Kradjian grew up in Vestal and graduated from Boston University in 1993 with a dual major in economics and philosophy. Before joining the family business in the mid-1990s, he worked in Houston and Boston. Kradjian currently serves on the business-development board at Tioga State Bank and served on the Broome County Industrial Development board. In addition to his role at Bates Troy as president and CEO, he is active in real-estate development in the Binghamton area. His avocations include fishing, travel, jazz, and architecture/design. He recently married his wife Anahit, and they reside in Vestal.