LAUNDRY work for border accommodation houses and hospitals will no longer be done on an industrial scale in North Albury.
Around 40 people are expected to lose their jobs with South Pacific Laundry ceasing the washing and drying of linen at its plant in Ramsden Drive.
The company will turn the site into a depot and laundering now occurring on the Border will be shifted to its much larger base in Melbourne.
South Pacific Laundry general manager marketing and people Sarah Rowley said the coronavirus had reduced the level of motel and hotel linen processing as fewer people were travelling.
"It was a difficult decision to make to no longer process laundry in Albury, but we're transforming that place into the largest redistribution site in Australia," Ms Rowley said.
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"This will ensure we can maintain our commitment to regional customers and to the region itself with ongoing service capability and continued employment for 25 of our team members.
"We've been acutely aware of the responsibility we have to the community and customers, but we also have a responsibility to shareholders as well."
The switchover from processing to depot will occur over the next two months and is expected to be complete by Christmas.
Laundry for Wagga and Canberra clients had been done in Albury and it will also shift to Melbourne.
Lavington's Siesta resort owner Stephen Jones was disappointed to learn his laundry would no longer get cleaned in Albury.
"To see any jobs lost in the local economy is dreadful," Mr Jones said.
"We spend a lot of money there and would like to think it's employing people in the town and the money is staying here.
"I'd rather keep it local and I'm really surprised because there's a lot of investment in the machinery, there's heaps of big washers and dryers.
"It's a shame for the town, a real shame."
In addition to processing dirty linen for hospitality providers, South Pacific also has a contract to wash bedding and other items for Albury Wodonga Health.
Under its previous name C&M Linen Service it began providing a joint service for Albury and Wodonga hospitals in 2011 after having previously only working for the Victorian health hub.
The result saw a Wagga provider replaced and C&M manager director Ray Hayes said at that time the extra volume would allow him to invest $1.6 million in new washing, finishing and sterilising technology.
Then hospital chief executive officer Dr Stuart Spring said the deal was "a win-win for Albury Wodonga Health and local business".