September 20, 2002—The European integrated facilities management market already has revenues of over $10bn per year according to new research, which also detects weaknesses in solution provider and customer relationships.
A new survey of European integrated facilities management by Frost & Sullivan, shows that the European FM market is still evolving with geographical expansion and new services posing challenges for the players.
However it claims a major failing of todays FM service providers is the poor service satisfaction levels. Customer ignorance over who offers integrated FM services also exists according to the findings as well as a lack of understanding of the benefits of outsourcing, such as improved efficiencies and cost reduction.
The research, based on 200 interviews with key FM decision-makers in the UK, Germany, France, Italy, Scandinavia and Benelux, also highlighted the difficulties which arise from over-ambitious contracts being signed, and the subsequent problems concerning reliability, reactivity, communication and geographic coverage. Another factor is that many FM providers claim to be pan-European in their service offering while they each have particular strength in just one region.
Frost & Sullivan said: “Integrated FM offers successful suppliers a chance to grow revenues through the provision of long term-contracts, often at high margins. Moreover, the penetration of integrated FM services is low (the great majority of outsourced work takes the form of single-service contracts) which provides plenty of room for further growth. By bridging the gap between supplier and customer, the market can accelerate its progression.”
Dalkia scored top marks amongst end-users in terms of overall market presence, with 12.9% of respondents identifying the company as a prominent force in the integrated FM market.
In France, external expertise is apparently the most crucial motivation to outsource, although price performance is not well regarded by French end-users. In the survey Elyo was followed by Dalkia as the leading player in France receiving 37.5% and 35% of the votes respectively. Johnson Controls came third in terms of market penetration, scoring 8.2% in Europe, and 21.2% in the UK.
“Geographical expansion of service offerings is one of the most obvious ways for an integrated facilities management provider to improve their turnover,” concluded the survey. “However, there are difficulties that need to be overcome first, primarily finding a suitable route to market and also the adoption of existing service provision techniques to new cultural methodologies.”
—Jessica Jarlvi
Reprinted with permission; copyright 2002 i-FM
