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Contact cleaning sector receives boost ahead of Brexit

A new report on the commercial cleaning equipment market has found that sales showed above inflation growth in 2018, though manufacturers and distributors face several challenges and shifting product trends.

The 270 page report from MTW Research suggests the cleaning equipment market has increased by 15%, boosted by product development – particularly in the powered cleaning machine market.

Whilst Brexit represents a key threat to the cleaning equipment market in 2018, forecasts are positive with above inflation growth likely to 2022.

MTW suggest the Brexit transition phase should offer stability for the cleaning equipment market, though highlights varying product trends and growth across the market.

Powered cleaning machine sales will outperform the cleaning equipment market in 2018, representing the fastest paced sector of the commercial cleaning market equipment.

The hard floor cleaning machine market is exhibiting healthy growth, with volume demand in the vacuum cleaner market and pressure washer market positive in 2018.

The market for these products will exceed £300 million for the first time in 2018, exhibiting growth of more than 50% since 2012.

The report reveals a number of positive product trends within the powered cleaning market.

MTW Director Mark Waddy said: “Whilst price deflation remains apparent in the cleaning equipment market, manufacturers are successfully differentiating themselves and their products. Demand for high quality, user friendly cleaning equipment which enhances efficiency continues to underpin growth for the cleaning equipment market, offsetting the threat of lower priced imports.”

The report also reviews the cleaning chemicals market, finding that whilst demand is strong for ‘antibacterial’ chemicals and ‘deep cleaning’, opportunities for growth in the environmentally friendly chemicals sector are significant in 2018. Often perceived as being ‘safer’ for the cleaning contractor and the end user, ‘green’ chemicals and more environmentally friendly cleaning processes are likely to continue to grow share of the cleaning chemicals market in the longer term.

A focus on hygiene across the spectrum of end use sectors continues to underpin the cleaning chemicals sector, with manufacturers of cleaning equipment working more closely with chemical suppliers to offer enhanced cleaning solutions. MTW report a 30% increase in cleaning chemicals over the review period, with growth set to outstrip inflation to 2022.

European commercial outsourcing grew 5% to €3bn in 4Q18

The sourcing market in Europe, Middle East and Africa (EMEA) grew in the final quarter of 2018 despite unsettling macro-economic and political events across the region.

The EMEA ISG Index from the Information Services Group, which measures commercial outsourcing contracts with annual contract value (ACV) of €4 million or more, shows the EMEA market posted combined fourth-quarter ACV of €3 billion, an increase of 5 percent from the prior year.

This rise was bolstered by a 44 percent year-on-year increase in as-a-service ACV, to €1.3 billion, as strong demand for digital transformation remained an enterprise imperative.

Infrastructure-as-a-Service (IaaS) and Software-as-a-Service (SaaS) in EMEA both performed strongly, posting ACV of €960 million and €331 million, respectively. Traditional sourcing, meanwhile, contracted by 12 percent year-on-year to €1.7 billion.

For the full year, EMEA reached €12.9 billion in ACV, up 9 percent against 2017. Traditional sourcing ACV of €8 billion was down 6 percent year-on-year, but as-a-service grew 48 percent to reach €4.9 billion.

The rise in as-a-service sourcing – which now accounts for 38 percent of total ACV for EMEA – continued to be driven by demand for SaaS and IaaS, both of which increased by more than 40 percent in 2018.

Steve Hall, partner and president of ISG, said: “Despite ongoing political and economic uncertainty in Europe and resulting business caution, companies are making significant investment in digital technologies to improve their ability to compete and to engage with their customers. This is a clear testament that the tailwinds of digital transformation are stronger than the headwinds of political and economic issues.”

Globally, fourth-quarter ACV for the combined global market grew 18 percent, to €9.8 billion. As-a-service ACV pushed to new highs in the fourth quarter, up 43 percent year-on-year, while traditional sourcing inched up 2 percent.

Declines in the UK, DACH and France pulled down the traditional sourcing market in 2018.

Full-year ACV in the UK fell by 27 percent, to €2.5 billion, despite a 5 percent increase in the number of contracts. The traditional sourcing market in the UK has slumped since the Brexit vote in June 2016. Prior to the vote, the UK averaged three €800-million quarters for traditional sourcing per year. Since the vote, only one quarter – the first quarter of 2017, which included the signing of some exceptionally large mega-deals – reached that mark.

Traditional sourcing ACV in DACH was down 4 percent in 2018, with a 19 percent drop in contract signings. The economy in DACH slowed in 2018 and fears of a recession have slowed decision-making. The UK Government defeat over the Brexit vote presents a further substantial economic risk to Germany, as well as the UK.

While UK and DACH companies are exercising caution in traditional sourcing decisions, both are increasing their investments in new technologies and as-a-service contracting to improve efficiency and meet consumer demand for new services and channels.

The results of unsettling economic and political factors also are evident in France, where traditional sourcing ACV edged down 3 percent, to €640 million, despite a steeper drop of 13 percent in contract volume. French consumers have turned to online shopping in recent weeks as the Gilet Jaune demonstrations spread, benefiting Amazon and other online retailers and potentially affecting the Retail sector in 2019.

In the Nordics, traditional sourcing was up 20 percent, to €1.1 billion, with the number of contracts growing by 14 percent. The smaller EMEA markets also showed strength with gains in Southern Europe, Africa/Middle East and Russia/Eastern Europe.

IFMA releases benchmark report for facility management

The International Facility Management Association (IFMA) its latest Operations and Maintenance: Qualitative Analysis Benchmarking Report.

The report, produced by IFMA’s FM Research and Benchmarking Institute (RBI), is a comprehensive analysis of the most recent operations and maintenance benchmarking survey of more than 2,000 individual responses representing 98,000 buildings in 35 industries

The industry body is particularly keen to focus on a section exploring FM strategies for organisational agility and change management.

The 2017 report focused primarily on financial metrics, while the Operations and Maintenance: Qualitative Analysis Benchmarking Report provides data from the United States and Canada on practices and tools being used by industry professionals in managing facility services quality.

For example, the report describes outsourcing of in-house maintenance needs and preventive maintenance plans.

The report includes data-based insights that can translate into operational guidelines for:

  • Solid waste diversion
  • Legislative mandates
  • Energy management
  • Green janitorial training and programs
  • Maintenance management
  • Planning
  • Work requests and device usage
  • Satisfaction with and perception of information technology services
  • Benchmarking plans
  • Customer satisfaction survey use and frequency
  • Organizational agility

“Like the businesses they serve, FM professionals are themselves operating in a perpetual state of change,” said Nickalos A. Rocha, RBI’s director of ​research and operations. “Benchmarks have always captured a cross section of time to help inform strategic decisions, provide external validation or reveal operational shortcomings. For that reason alone, this report comes through in a big way, covering tools and tactics that define modern FM. On top of that, we’ve taken an extra step to ask FM professionals about their strategies for organizational agility. This analysis offers insights for how FM is thriving in a dynamic environment of change.”

The report is available for purchase and immediate download at: bit.ly/ombenchmarks18

FM sector increases hourly pay for skills-short roles as Brexit looms

Facilities management firms are turning to financial incentives to lure top contract talent as the Brexit vote drives EU citizens out of the UK, according to new data.

Engage Technology Partners says its pay data has revealed that since the vote to leave the Bloc in 2016, hourly pay for skills-short roles has increased, with maintenance positions in particular noting an uptick in money.

Handymen and mechanical maintenance professionals reported the greatest increase in the three years since the vote at 13% and 10% respectively, while electricians saw a 5% rise in hourly rates.

This data has been revealed amid news from the CIPD that talent shortages are already being felt ahead of the UK’s exit from the EU next year. According to its latest Labour Market Outlook report, a third of employers of EU citizens have reported that the Brexit decision has led to an exodus of these professionals from their UK base.

Drey Francis, Director at Engage, said: “For Facilities management firms, maintaining reliable access to a team of maintenance professionals was already an issue before the Brexit vote. Since the decision was made to exit the EU, this issue has deteriorated further, with many of the FM firms we have a relationship with reporting that availability of these professionals is one of their biggest concerns going in to 2019.

“Given how sparse some of the talent for these roles is in general, it’s perhaps no wonder that employers are turning to financial incentives to attract staff. However, this isn’t a sustainable approach. Of course, we still need to wait and see what happens in terms of the agreement on the Freedom of Movement for the UK, but action can be taken now to improve staffing efficiencies in order to better cope with the expected upheaval in Spring 2019. For example, where FM businesses have widespread operations, there are often resources that can be utilised in other locations, but a lack of visibility of this information is preventing hiring managers from tapping into these staffing pools.”

Global corporates ‘want flexible office space’

Two thirds of global corporates plan to increase their use of flexible co-working and collaborative space over the next three years, according to new research.

Knight Frank’s ‘Your Space’ report polled senior executives at 120 global companies which collectively employ in excess of 3.5 million people worldwide and occupy an estimated 233 million sq ft of office space, equivalent to the total amount of office space in Central London.

The reports shows global corporates intend to operate increasingly from flexible, serviced and co-working spaces, which, they says, create a more collaborative working environment and offer the freedom to expand and contract quickly according to market conditions.

The reports says that despite the proliferation of co-working and serviced office operators the majority of global corporates still occupy office space on a traditional lease model. Two thirds of companies surveyed reported that co-working, serviced and flexible office space comprise 5 per cent or less of their current office space. A small minority, less than 7 per cent, said that flexible workspace exceeds a fifth of their total workspace.

However, Knight Frank’s research reveals that the proportion of flexible space within companies’ portfolios is set to increase dramatically. Over two thirds, 69 per cent, of global corporates plan to increase their utilisation of co-working spaces, and 80 per cent expect to grow the amount of collaborative space they use over the next three years.

Furthermore, almost half (44 per cent), stated that flexible space will constitute up to a fifth of all office space in the next three years. An additional 16 per cent estimated that as much as half of their workspace globally would be flexible space within the same time period.

Over half of companies (55 per cent) identified increased flexibility as the main driver of this change, with a significant proportion (11 per cent) stating that the sense of community fostered among workers was the key benefit. A further 11 per cent stated that the greater speed to becoming operational was the primary reason for selecting co-working or serviced office space ahead of more conventional office space.

75 per cent of respondents stated that personal productivity linked to wellbeing and happiness, would increase as they shift towards a new flexible and collaborative model of occupancy that is more in keeping with today’s business structures and working styles.

Dr Lee Elliott, Global Head of Occupier Research at Knight Frank, said: “This research underlines that a decade of global economic uncertainty has reshaped how many of the world’s largest companies view workspace. Shorter business planning horizons, together with the emergence of new, more agile corporate structures has driven demand for flexible space which enables companies to react to change quickly.”

“While co-working and serviced office operators have grown rapidly over the past five years, driven largely by start-ups and the freelance economy, this is only the tip of the iceberg with latent demand from global companies set to emerge over the next three years.”

William Beardmore-Gray, Global Head of Occupier Services and Commercial Agency at Knight Frank, added: “The demand for flexibility is the single biggest threat – and opportunity – to owners of office space. The recent boom in co-working is indicative of a structural change within commercial real estate whereby companies desire space that is flexible, highly serviced and aligned within the realities of doing business in an age of disruption. Some co-working operators have capitalised on this already, but it is imperative that owners and developers react to the new reality where customer is king.”

CCTV & Surveillance: 2018 buying trends revealed

Cameras, Surveillance & Monitoring Systems and CCTV Maintenance top the list of CCTV & Surveillance services the UK’s leading security professionals are sourcing in 2018.

The findings have been revealed following the Total Security Summit, which took place in March.

Delegates registering to attend the event were asked which CCTV & Surveillance services they needed to invest in during 2018 and beyond.

A significant 54% are looking to invest in Cameras, with 44.6% sourcing Surveillance & Monitoring solutions and expertise.

Just behind were CCTV Maintenance (38.5%), Video Analytics (30.8%) and ANPR (29.2%).

% of delegates at the Total Security Summit sourcing CCTV & Surveillance services (Top 10):

Cameras – 53.8%
Surveillance & Monitoring – 44.6%
CCTV Maintenance – 38.5%
Video Analytics – 30.8%
ANPR – 29.2%
IP & Infrared Cameras – 27.7%
Remote Video Monitoring -27.7%
DVR / NVR – 23.1%
Technical surveillance Counter measurements – 13.8%
Digital Multiplexers – 6.2%

To find out more about the Total Security Summit, visit www.totalsecuritysummit.co.uk.

2018 Access Control & Biometrics buying trends revealed

Locks & Locking Systems, Smartcards & ID Cards and Alarm Systems top the list of Access Control & Biometrics services the UK’s leading security professionals are sourcing in 2018.

The findings have been revealed following the Total Security Summit, which took place last month.

Delegates registering to attend the event were asked which Access Control & Biometrics services they needed to invest in during 2018 and beyond.

A significant 50% are looking to invest in Locks & Locking Systems, with 47.7% sourcing Smartcards & ID Card solutions and expertise.

Just behind were Alarm Systems (46.2%), Wireless Access Control (44.6%) and Card Readers (38.5%).

Interestingly, Facial Recognition solutions were being sought by more than 30% of delegates.

% of delegates at the Total Security Summit sourcing Access Control & Biometrics services (Top 10):

Locks & Locking Systems – 47.7%
Smartcards / ID Cards – 47.7%
Alarms Systems – 46.2%
Wireless Access Control – 44.6%
Card Readers – 38.5%
Visitor registration software – 38.5%
Facial Recognition – 32.3%
Key Holding – 32.3%
Security Doors and Windows – 29.2%
Alarm Management (Global Security Operation Centres) – 26.2%

To find out more about the Total Security Summit, visit www.totalsecuritysummit.co.uk.

Global FM market to be worth $1,887bn by 2024

The worldwide market for facilities management is anticipated to witness a robust CAGR of 13.6% between 2016 and 2024, according to a new report.

Transparency Market Research says the global market, which was valued at $606bn in 2015, is expected to be worth $1,887bn by the end of 2024.

The corporate domain is a major contributor to the global revenue in the facilities management market and is expected to rise at a maximum pace of 15.1% CAGR from 2016 to 2024.

This segment represented a 21.3% share in the facilities management market in 2015, fueled by the needs of the flourishing IT and BFSI (banking, financial services, and insurance) sectors.

Europe leads the total market value by a wide margin and estimated to be worth $624.9bn by the end of 2024, equivalent to a 12.5% CAGR attributable to increasing demand for maintenance and support by manufacturing enterprises in the region, along with the rising demand for various types of specialised services, i.e. fabrication, plant maintenance and HVAC.

While the UK is the biggest generator of revenue in the European facilities management market, Germany is expected to post the most astounding development over the coming years.

Moreover, Asia Pacific is another key market which is expected to rise speedily by registering a 15.5% CAGR over the course of the forecast period. Its facilities management market is predicted to achieve a value of $437.1 n by the end of 2024, owing to the fast advancement in educational and private sectors.

Sports FM Buying Trends

Sports Facilities Management: 2018 buying trends revealed

Fitness & Gym Equipment, Changing Rooms and Fitness Testing top the list of solutions the UK’s leading sports and leisure industry professionals are sourcing in 2018.

The findings have been revealed in the lead up to the Sports & Leisure Forum which takes place June 18th & 19th.

Delegates registering to attend the event have been asked which areas they needed to invest in during 2018 and beyond.

A significant 70% are looking to invest in Fitness & Gym Equipment, with 56% sourcing Changing Rooms/Showers solutions.

Just behind were Fitness Testing & Wireless Fitness Monitoring (49%), Clothing Kit & Uniform (47%), Sports Flooring (44%) and Artificial Surfaces & Sports Surfaces (42%).

“It’s probably no surprise that Fitness & Gym Equipment top the list of areas our delegates were most interested in,” said Sports & Leisure Forum Event Manager Luke Webster. “But the full table provides a valuable insight into trends within the sports FM sector.”

% of delegates at the Sports & Leisure Forum sourcing certain products & solutions (Top 10):

Fitness & Gym Equipment – 70%

Changing Rooms/Showers – 56%

Fitness Testing & Wireless Fitness Monitoring – 49%

Clothing Kit & Uniform – 47%

Sports Flooring – 44%

Artificial Surfaces & Sports Surfaces – 42%

Facilities Management – 42%

Lockers – 42%

Design & Build – 37%

Interior Fit Out – 37%

To find out more about the Sports & Leisure Forum, visit  www.sportsandleisureforum.co.uk.

Europe FM

European FM market ‘moving toward service integration’

Integrated facilities management (IFM) continues to represent the fastest-growing segment of the European FM industry, according to a new report from Frost & Sullivan.

It says the industry will continue to move toward service integration and sophisticated advisory services focussed on business productivity.

While European clients are demanding added value and innovative solutions, with areas such as workplace management, sustainability, data analytics, and energy management all growing in popularity, multinational companies are likely to be challenged by national FM vendors moving into IFM and heightened merger and acquisition activities.

“The European IFM market is yet to see full consolidation. However, this will change in the next few years as firms add to their service capabilities by building hard FM skills and moving towards more integrated offerings,” said John Raspin, Partner at Frost & Sullivan.

To survive and thrive in this highly competitive market, Frost & Sullivan says IFM companies need to embrace key market trends, including:

  • Cloud-hosted analytics to drive remote management for technical services and preventative maintenance;
  • New business models such as anything-as-a-Service (XaaS) models to utilise technology to shift from CAPEX to OPEX;
  • Social and demographics changes such as technology, labour force, and workforce change management to increase value creation;
  • Industry Mega Trends such as industrial internet of things, artificial intelligence, augmented reality, and intelligent robots to transform IFM services across Europe in terms of service delivery options and customer behaviour.

“Commercial multinationals have long taken the lead in reaping the benefits of IFM,” added Raspin. “With lessons learnt from the commercial market, industrial multinationals are expected to increase their presence in this market whilst also bringing new, challenging demands for vendors.”