The global market for integrated facilities management (IFM) is expected to grow at a CAGR of 7 per cent until 2020, according to a new report.
The forecast from Beroe, a procurement intelligence firm, says demand for FM outsourcing and the adoption of an IFM strategy signals an increasing buyer maturity and willingness to partner with suppliers.
APAC remains the fastest growing market for outsourced FM services and the progressive growth of major economies in the region such as China and India are expected to keep the demand high.
Moreover, the increasing levels of commercial property creation and construction are accelerating the market for outsourced FM services.
The Beroe report says one major driver of the IFM market is the improvement in economic conditions across developing countries and large scale industrial development such as construction and real estate.
Alternatively, the low level of awareness among buyers in developing markets about the opportunities offered by outsourcing FM services is a constraint in the industry.
However, Beroe cautions that the IFM industry is facing impediments globally and the situation seems to be critical with several top Tier-2 suppliers such as Serco, G4S, MITIE, Interserve and Carillion struggling to upgrade their services.
Tier 2 companies, meanwhile, are developing skills to provide a wide range of services to various sectors such as housing corporation, oil & gas, retail, hotels, and manufacturing.
Key Report Findings:
- The major cost factors involving a global IFM model are labor and materials costs, which account for nearly 80 – 90 percent of the total cost.
- IFM is the commonly used model in the food and soft drinks industry as integrating the services to one principal supplier will contribute to reducing costs, driving greater consistency, and alignment.
- Programmed FM companies have launched an innovative service in the IFM industry called sustainable solutions, which caters to the conservation of energy, water, and emission.
- Large buyers such as Unilever and Heinz have adopted and integrated their FM services with a single service provider, which has resulted in 10-20 percent in cost savings.
- IFM and TFM sourcing models provide the best savings opportunity for consumers with minimal involvement in the process.
From robotics and wearable technology to IoT, the IFM industry is becoming more interconnected, and the suppliers are looking forward to utilising technology to drive productivity and achieve cost savings for the client.
Additionally, outsourcing to a single FM player would enable buyers to regulate the level of services across various locations, and the productivity and efficiency could be improved through the initiation of various KPIs and compliance clauses.