March 3, 2008—The world Contract Cleaning Services market is forecast to reach $155.3 billion by 2010, according to a new report by Global Industry Analysts, Inc.
In terms of growth, however, residential dwellings are expected to surpass all other end-use sectors for contract cleaning services, with a projected compound annual growth rate (CAGR) of 4.36 percent from 2001-2010, the report predicts.
The market is forecast to maintain a CAGR of 3.9 percent over the 2001-2010 period to reach $155.3 billion by 2010. CAGR is the rate of an investment growing with compound interest.
In the long run, cleaning is considered a stable and growing market, while in the short run, there is very little effect of economic upheavals on this industry as cleaning is the last thing to be impacted in the economic cycle, the report says.
Also, health and safety legislations restrict the companies and other sectors to cut back on cleaning activities and the cost savings from removing cleaning activities from the basic job is very small.
Long-term drastic measures against cleaning activities are only taken when there are large-scale business failures. One of the possible reasons for long-term slowdown in the office-cleaning sector is that more and more office workers start working at home when there are business failures. These negatives are generally offset by growing trends in facilities such as airports, major shopping centers, gyms, and other public and private places.
The contract cleaning industry is labor intensive, so wages are the main cost borne by the service providers. Duration of cleaning contracts may vary from one year to several years.
The report also notes that contract cleaning service providers are exposed to growing competition, escalating insurance costs, volatile costs of supplies, and varying availability of economical labor. A primary concern for the industry is the high rate of employee burnout.
Poor profit margins and intense competition from big, established companies drives out new entrants from the market.
Major companies covered in the report include ABM Industries Inc., Chem-Dry, Coverall Cleaning Concepts, Dublcheck, Ecolab, Inc., Horizon National Contract Services, LLC, Interserve plc, ISS (Integrated Service Solutions) A/S, JAN-PRO International, Jani-King International, Inc., JohnsonDiversey Inc., Medirest, Merry Maids, MITIE Group Plc, Pall Mall, OCS Group Ltd., OneSource, Quick Cleaning, Rentokil Initial Plc and The ServiceMaster Company.
For more details about this research report, visit the Global Industry Analysts Web site.
