Facilities Management Market Set for Change in 2010

The report indicates that client loyalty in the FM market is being steadily eroded by price competition in 2010, with many of the commodity sectors within the market, such as property maintenance, office support etc, becoming increasingly price sensitive. MTW found that this trend was fuelled by the recent recession and resulted in multi-service FM providers gaining further share of the market in 2009, with these companies often able to offer greater cost savings than single service FM contractors.

MTW also found that the Facilities Management market has become increasingly characterised by closer relationships between suppliers and contractors, as greater efficiencies and lower procurement costs are sought. During 2009, several FM companies established programmes specifically designed to improve supplier relationships to ensure that material and equipment suppliers were aligned with customer relationship principles and accountable for their own supply chains. According to MTW, these supplier improvement programmes vary in scope, though typically include audits in relation to CRM, sustainable procurement and may even include a ‘best practice’ policy to which suppliers are expected to adhere.

Based on sales figures from the industry, the total FM market is currently worth just under £90 billion according to MTW, with operations and maintenance services the largest sector in 2010 and integrated or ‘bundled’ FM service provision now the second largest market segment. The report states that security services provision, which includes CCTV monitoring, access control, security screening etc has grown steadily in recent years. MTW point to a greater emphasis on public safety and anti-terrorist activity supporting buoyant growth in security services demand in 2010 and beyond, with this sector anticipated to outstrip overall FM market growth in the longer term.

MTW’s report also reviews the structure and current health of the facilities management industry, with just over 65% of FM contractors viewed as having either an ‘excellent’ or ‘good’ credit rating, reflecting a core strength in the market in terms of financial standing. However, the impact of the recession is clearly evident, with the report identifying that around 11% of the companies active in the Facilities Management market are viewed as being at imminent risk of failure.

By the end of 2010, the report states that the overall FM market is expected to grow to a value of around £87.7 billion, reflecting sustained public expenditure coupled with a return to stronger growth from the private sector. MTW’s SWOT analysis identifies a number of key market influencers which are expected to further drive the market in 2011, despite increasing uncertainty regarding short and medium term public spending budgets.
The 200 page report provides a comprehensive review of the UK facilities management market in 2010 and forecasts sales to 2013, with product and end use sector shares alongside sales leads for key FM contractors. The report is available to purchase from GBP565 from MTW Research’s website www.marketresearchreports.co.uk where a free sample is available to download or by calling 08456 524324.