The corporate FM sector will continue to grow over the next few years, according to a new report released this week. AMA Research released ‘Facilities Management Outsourcing –Corporate Sector Report – UK 2015-2019’ which analysed market activity within the corporate sector from 2009 to 2015, including forecasts to 2019.
The overall outlook seems good, despite the industry feeling the effect of slow construction and development during the recession. Today, contracts are increasing, business confidence levels are growing and with a more stable economy underpinning it, the outlook is positive. The report notes a particular spike in interest in outsourcing FM services, a trend which is also showing no signs of slowing down in the current climate.
Commercial offices are the largest users of outsourced facilities services, accounting for half of the total market by value. The second-largest contributor is retail, with entertainment and leisure sectors also contributing significantly. It therefore stands to reason that the development and expansion of these sectors in the wider climate will directly affect the room for growth for the corporate FM sector. Around 75 per cent of services within the corporate market (by value) are now thought to be outsourced in some way, and the commercial office and retail sectors are approaching saturation point.
But it also clear that margins were still under pressure, which reflected consolidation in the market. The number of large FM providers has grown, with these bigger players focused on winning enough business to fill their capacity.
The report also interestingly highlights some areas for concern – saturation in the marketplace means margins are tight and competition in this sector is fierce. The arrival of the living wage coming into effect in 2016 may further add to the pressure on contractors to deliver within tougher parameters. Read the report details in full by clicking here.
