Post on 20-Aug-2021
UK Facilities Management Market
1
Baskar Sundaram
2
Who is Baachu?
Industry
Defence
Healthcare
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Transport
Aviation
Justice & Immigration
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Waste Management
Service
Customer Relationship Management
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Operations & Maintenance
Business Process Management
Procurement
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Introduction
3
Contents
UK Outsourced FM Market (Summary Breakdown)
FM Service Providers Landscape
Market Definitions
4
Outsourced FM Market in UK
▪ Outsourced FM market in the UK was c.£117 Bn in total
contract value (TCV) in 2020
▪ Both public and private sectors contributed almost
equally to the total FM Market in UK
58.4 58.6
Outsourced FM Market (in £Bn)
Public Private
Source:
1. Rain FM Database
2. Baachu Analysis
Outsourced FM Market in UK – Public and Private, 2020
5
▪ In Public sector, Central Government contributed 34.5%
to the public FM market; followed by Local Government
(23.1%)
▪ Whereas in private sector, Office sector contributed
42.3% to the private sector market; followed by
Manufacturing & Industrial (15.1%)
Outsourced FM Market – By Sector (2020)
Outsourced FM Market in UK – By Sector
21.4%
17.2%
11.7%7.6%
6.6%
5.6%
5.4%
5.2%
5.1%
4.7%
3.9%3.6%
1.0%1.0%
Office
Central Government
Local Government
Manufacturing & Industrial
Energy and Utilities
Defence
Residential and Housing
Health Care
Leisure
Transport
Retail
Education
Property Management
Others
Source:
1. Rain FM Database
2. Baachu Analysis
Total FM Market = £117.0 Bn
6
Outsourced FM Market – Public Sector
34.5%
23.1%
11.2%
10.4%
6.3%
5.7%
4.4%
1.3%1.0% 2.2%
Central Government
Local Government
Defence
Health Care
Education
Residential and Housing
Transport
Leisure
Energy and Utilities
Others
Source:
1. Baachu Rain FM
2. Baachu Analysis
Total Public FM Market = £58.4 Bn ▪ The central government is the biggest outsourcer of
public FM services, followed by the local government
▪ The central and local government together offer the
biggest opportunity to private FM providers as they
account for more than half the market (c.58%) of the
outsourced public FM market
Outsourced Public Sector FM Market in UK – By Sector (2020)
Note:
A. Transport includes govt. transport authorities such Department for Transport (DfT); Transport for London; Bristol Airport; Highways England etc.
B. Leisure includes govt. bodies operating public facilities such as British Library; Imperial War Museums; Blair Castle etc.
A
B
7
Outsourced FM Market – Private Sector
Source:
1. Baachu Rain FM
2. Baachu Analysis
42.3%
15.1%
12.2%
8.8%
7.9%
5.0%
4.9%
2.0%0.9% 0.9%
Office
Manufacturing & Industrial
Energy and Utilities
Leisure
Retail
Residential and Housing
Transport
Property Management
Education
Others
Notes:
A. Leisure includes private facilities such as Aberdeen Football Club; ACC Liverpool; Ace Hotel London Shoreditch etc.
B. Transport includes private transport players such as Air Mauritius; Airbus UK; Arriva Trains; BAA; BAE Systems etc..
C. Local Govt., Central Govt., healthcare and media sector have been included in Others as part of the analysis
Total Private FM Market = £58.6 Bn ▪ The Office sector contributed the highest to the
outsourced private FM market – accounting for c.42% of
the total c.£59 Bn of outsourced private FM
Outsourced Private FM Market in UK – By Sector (2020)
C
A
B
8
Outsourced FM Market in UK – Market Share (by TCV)
10%
6%
5%
4%
4%
2%
2%
2%
2%2%
1%
1%
1%1%1%1%1%1%1%
1% 1%
52%
Mitie
Interserve
Carillion
Sodexo
Compass
ISS
ENGIE
Babcock International Group Plc
Serco
Capita Business Services Limited
Integral + JLL
G4S
Amey
EMCOR
City FM
CBRE
OCS
Skanska
Kier
Vinci Facilities
Atalian Servest
Others
Source:
1. Baachu Rain FM
2. Baachu Analysis
Total Outsourced FM Market = £91.4 Bn
Note:
A. Carillion was liquidated in January 2018; however, its contracts were considered to calculate the market size in 2020 since Carillion contracts were awarded to other providers
B. Others also includes contracts that were awarded to multiple vendors
Outsourced FM Market in UK – Top FM Players
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Definitions
Hard FM Soft FM
▪ Building services control and management systems
▪ Building fabric
▪ Appliance testing
▪ Fire protection systems
▪ Fire alarm and detection systems
▪ Asset management
▪ Mechanical services
▪ Electrical services
▪ Heating, ventilation, and air conditioning (HVAC)
▪ Plumbing
▪ Environmental management
▪ Energy management
▪ Escalator maintenance
▪ Flooring
▪ Roofing
▪ Boiler control/ maintenance
▪ Cleaning
▪ Catering/ food services
▪ Housekeeping
▪ Janitorial
▪ Laundry
▪ Linen
▪ Patient Transport
▪ Portering
▪ Parking
▪ Vending
▪ Waste management
▪ Courier services
▪ Laundry services
▪ Post room staffing and management
▪ Reception staffing/ Front-of-house
▪ Security and safety
▪ Landscaping
▪ Pest control
Inte
grat
ed F
M (
incl
ud
es b
oth
Har
d a
nd
So
ft F
M)
Sources:1. Web Search
10
Definitions
▪ Propertyservices includes:
• Space planning and design
• Landscaping
• Property acquisitions and disposals
• Relocation management
▪ Energymanagement includes:
• Energy managementservices
• Carbon management
▪ Environmentalmanagement includes:
• Wastemanagement
• Recycling services
▪ IT and telecommunications includes:
• Establishment of IT systems (Intranet services, company databases)
• Maintenance of IT hardware and software
• Data centre
• Introduction of newsoftware packages
Additional Services
▪ Workplace services includes:
Work Place Strategy
• Make your work spaces deliver your business goals
Work Place Analytics
• Data-driven monitoring to assess how spaces and experiences are working
Work Place Design
• Creating spaces and experiences to connect and empower your teams, however they work
Work Life Services
• The delightful details that support life for people at work, helping them to thrive
Work Place Management
• Providing safe, comfortable and compliant environments - everything you need to make a workplace ‘just work’
Sources:1. Web Search
11
Market Definitions (1/4)
GeographicCoverage UK
Study Period 2020–2023
Base Year 2020
ForecastPeriod 2021–2023
MonetaryUnit UK Pounds
▪ Revenues quotedfor the FM market in this study are
counted by end-user contract only and cover the
outsourced FM market (excluding in-house FM services).
▪ Revenue figures referencing the total FM market describe
the ‘addressablemarket,’that is, the market targeted by
servicesolutionproviders.
Definition ofRegions
This study identifies opportunities across the spectrumof FM servicemarkets and focusesin detail on
certainkey markets.Thestudy solely focuses on the UK.
Definition of Customer Sectors
Whenanalysingthe market by customersector, the followingsegmentationis used:
Public Sector: Healthcare, government, education, and ‘other public sector’ (including military,
transport, libraries, public buildings, heritage and culture).
Private Sector: Commercial offices, financial services, manufacturing, and ‘other private sector’
(including retail, hospitality & leisure, and logistics).
Sources:1. Web Search
12
Market Definitions (2/4)
The market for outsourced FM services can be split into 3 main types of service by delivery model: Single services, bundled services, or integrated FM (IFM).
The different types of FM can be defined as follows:
▪ Single Service: Provision of services within one
service sphere only.
▪ Bundled Services: Provision of two or more services within one contract within a defined service sphere by the same provider.
▪ IFM or Integrated Facilities Management: Provision of services from more than 1 distinct service sphere by the same provider. Services are delivered within the framework of an
integrated contract.
FM Market: Service and Delivery ModelDefinitions
Sources:1. Web Search
13
Market Definitions (3/4)
Term Definition
Facilities Management ▪ Facility Management (FM) is a encompasses multiple disciplines to ensure functionality, comfort, safety and efficiency of the built environment by integrating people, place, process and technology
▪ FM includes Operations and Maintenance, Communications Management, Emergency Management and Business Continuity, Environmental Stewardship and Sustainability, Hospitality, Human factors and ergonomics, Project management and Real estate and Property Management
▪ It can be provided in-house or it can be outsourced
Hard Facilities Management Hard FM services are the ones that cannot be removed from the premises and directly related to the fabric of the building. These services ensure the health, safety and welfare of employees are adhered to and most are required by law. Hard FM includes Lighting, Plumbing, Heating, Air Conditioning, Building Maintenance and Fire Safety systems
Soft Facilities Management Soft FM can be categorised as services and facilities that make the workplace a better place to be in – either by making it more secure, pleasant working environment or more efficient. Soft FM services include but are not limited to Landscaping, Window Cleaning, Cleaning, Security, Post Management, Waste management, Catering, and Car parking
Integrated Facilities Management
A method of consolidating all the business’s facility services and functions under one team of experts. This includes contracts, vendor partnerships, space management, and real estate planning
Planned Maintenance Refers to any maintenance activity that is planned, documented, and scheduled. The aim of planned maintenance is to reduce downtime by having all necessary resources on hand, such as labour and parts, and a strategy to use these resources
Reactive Maintenance Refers to repairs that are done when equipment has already broken down, in order to restore the equipment to its normal operating condition
Refrigeration Refrigeration is a process which cools a closed space by removing heat from it. It involves the boiling and condensation of a refrigerant to cool a surface or volume.
Mechanical & Electrical (M&E) Refers to the Mechanical and Electrical systems that are installed and maintained by a Facilities Management company. Mechanical Systems can include elements of infrastructure, plant and machinery, tool and components and heating and ventilation. Electrical systems might include, power supply and distribution, telecommunications, computing instrumentation and control systems
Operations & Maintenance (O&M)
Refers to the functions, duties and labor associated with the daily operations and normal repairs, replacement of parts and structural components, and other activities needed to preserve an asset so that it continues to provide acceptable services and achieves its expected life
Vetting The process of thoroughly investigating an individual, company, or other entity before deciding to go forward with a joint project
OutsourcingThe business practice of hiring a party outside a company to perform services and create goods that traditionally were performed in-house by the company's own employees and staff
Sources:1. Web Search
14
Market Definitions (4/4)
Term Definition
Asset Management The process of developing, operating, maintaining, and selling assets in a cost-effective manner. The term is used in reference to individuals or firms that manage assets on behalf of individuals or other entities
Building Management System (BMS)
A control system that can be used to monitor and manage the mechanical, electrical and electromechanical services in a facility. Such services can include power, heating, ventilation, air-conditioning, physical access control, pumping stations, elevators and lights
Engineering The art or science of making practical application of the knowledge of pure sciences, as physics or chemistry, as in the construction of engines, bridges, buildings, mines, ships, and chemical plants
Computer Aided Facilities Management (CAFM)
Refers to the use of information technology to effectively manage physical facilities in various ways. This can include long-range facilities management reporting, as well as more direct systems that actively manage aspects of facilities, such as lighting or heating and air conditioning equipment
Waste Management Refers to the activities and actions required to manage waste from its inception to its final disposal. This includes the collection, transport, treatment and disposal of waste, together with monitoring and regulation of the waste management process
Project Management It involves the planning and organization of a company's resources to move a specific task, event, or duty towards completion. It can involve a one-time project or an ongoing activity, and resources managed include personnel, finances, technology, and intellectual property
Computer Aided Design (CAD) CAD involves creating computer models defined by geometrical parameters. It is a three-dimensional representation of a part or a system of parts, which can be readily altered by changing relevant parameters. CAD systems enable designers to view objects under a wide variety of representations and to test these objects by simulating real-world conditions
Life Cycle Costing The process of compiling all costs that the owner or producer of an asset will incur over its lifespan. These costs include the initial investment, future additional investments, and annually recurring costs, minus any salvage value
Fabric Maintenance The maintenance of the fabric and infrastructure of a production asset. Fabric Maintenance is central to extending an asset’s operating life. Fabric Maintenance service include coatings and surface preparation, insulation, passive fire protection and special access systems
Landscaping The process of making a garden or other piece of land more attractive by altering the existing design, adding ornamental features, and planting trees and shrubs
Sources:1. Web Search
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▪ The study includes growth forecasts, comprehensive market size (Hard FM, Soft FM, TFM, IFM, specialist services and by 11 Public Vs Private sector), government policies, 20+ leading FM providers, competitive analysis, buyer trends and a mapping of the most attractive opportunities for growth to 2023.
▪ Most comprehensive UK FM Market BOTTOM UP study covering – 11+ Sectors, 20+ FM suppliers, 6+ services, Trends and Challenges, Market Drivers and Restraints, Profitability Vs Turnover Quadrant for top 20 FM companies.
https://baachurain.com/product/uk-facilities-management-market-2021-2023-report/
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How Baachu Team Supported Leading Service Providers?
1. Market knowledge and assessment
2. Goto Market strategies – entry and expansion
3. C-suite advisory and Investor analysis
4. Acquisition due diligence support
5. Supply chain analysis, Cost benchmarking
6. Pre Sales, CRM and Tracker support - review, implement, reporting, dashboards and metrics benchmarking
1. Pipeline development and opportunity tracking
2. Pipeline Assessments
3. Profile of prospective clients and key executives
4. Diagnosing pain points of prospects and suggest solutions based on existing capability
1. Design & restructuring of BD function using BD –CMM
2. Partner identification & assessment for bids
3. Develop, review and amend governance process and reporting
4. Capture management (win strategy)
5. Competitive intelligence
1. Estimating/ Financial/ Cost – Model Build and Audit
2. Transition and mobilisation plan and PMO support
3. Post bid financial budgeting
4. Bidding Tools and Templates, Execution Plans
5. Proposal and People assessments
6. APMP certification training & Proposal Apprenticeships
Business Growth
Strategy Pre-sales
Business Development
Business Winning
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▪ Growth assessment: Market entry/ expansion, gap analysis (capability, financial, operations), organic and acquisition
▪ Corporate planning: Portfolio analysis, performance analysis, business & financial planning and budgeting
▪ Assessment: Market, strategy, capability, customer, supplier and current pipeline
▪ Operations: Business analysis, contract review, transformation, optimisation and industry best practices
▪ Competitor & customer analysis: Landscape, profiling, capability & strategy analysis and benchmarking
▪ M&A support: Target identification & assessment, due diligence, valuation, synergy and PMI
▪ Partner identification: JV partner/ sub contractors identification and assessment
▪ Intelligence: Market, competitor, customer, government and partners
Which organisational functions do we serve?
▪ Business development design and restructure capability: Response generation, leadership integration, solution collaboration, CRM system implementation & reporting, quantitative performance management, knowledge tools and win/ loss analysis
▪ Team design, competency assessment and skills development: Bid management, commercial, solution, bid production, knowledge function, sales operations, mobilisation and account teams
▪ Bid process: Review and amend governance procedures, project gates-reviews and bid metrics
▪ Pipeline generation: Identify, qualify and track open, rebid and Greenfield opportunities; and identify additional opportunities with existing clients
▪ Capture management: Opportunity assessment, SWOT analysis, customer analysis, competitive benchmarking, incumbent performance analysis, sub-contractor assessment and bid win strategy
▪ Bid modelling: Develop & review cost, pricing models, transformation pricing. risk modelling, scenario building and sensitivity analysis
▪ Operational modelling: Contract benchmarking, cost optimisation, align operational data with bid financials, process mapping, capacity & resource planning and asset renewal pricing
▪ Solution: Story boarding and building target operating model
▪ Bid management: Bid document design, bid writing and governance
▪ Project support: Program mobilisation, transformation, business restructure at divisional, business unit and contract level
▪ Contractual models: Design & implement joint ventures, straight outsourcing deals, frameworks, partnerships and PFIs
Business Development
Business Winning
Strategy
Supported by subject matter experts (Market, Operations, Transformation, Design etc.)
Capability
22
Baachu Strategic Sales and Marketing - Selected projects O
ngo
ing
sup
po
rt Pre-sales Support (Pipeline development, analysis and tracking of open, competitive & framework opportunities)
Market Intelligence Reports (Tracking of industry, bids, policies, prospects, customers and competition)
Bid/ Financial Modelling (Building and auditing models, financial analysis and dashboards)
Be
spo
ke S
up
po
rt
Market Assessment (Market size, Segments, Value chain, Drivers, Trends, Forecast, Players)
Identification and Benchmarking of Competitors, Suppliers, Partners and Sub-contractors
Bid Intelligence/ Analysis of bid (capture management), Company, Customer, Partner, Sub-contractor and Competitor
Strategy Support (Growth, Corporate Planning, Market Entry, Operational, Diversification and MI Reporting)
Bes
po
keSe
lect
ed
Pro
ject
s
▪ Identified and analysed top 20 opportunities in UK defence sector
▪ Identified and assessed JV partner for>£500 Mn bid
▪ Opportunity and competitive assessment of upcoming glider O&M bid in UK
▪ Bid analysis and partner assessment forProject Hestia
▪ Identification and assessment of acquisition target
▪ Identify, analyse and qualify BPOopportunities in Justice market
▪ Detailed assessment of prison management market
▪ Assessment of global immigration market
▪ Assessment of electronic monitoring market in Americas
▪ Analysis of justice and corrections market in ANZ
▪ Bid modelling of prison management bid
▪ Developed pipeline of FM & BPO opportunities in healthcare sector
▪ Assessment of outsourcing of services by NHS Trusts
▪ Occupational health market analysis
▪ Due diligence of potential partners for healthcare FM bid
▪ Bid modelling of hospital FM bids in UK, Hong Kong and UAE
▪ Developed pipeline of FM opportunities in higher education sector
▪ Assessment of outsourcing BPO and FM market in local government
▪ FM opportunity identification in nuclear sector in UK
▪ Assessment of UK Welfare to Work Market
▪ Analysis of Crown Commercial Service (CCS) Frameworks focuson FM and energy
▪ Bid modelling of airport FM services
Defence Justice & Immigration Healthcare Others (e.g. Local Govt., Central Govt., Education)
Bid and Mobilisation Support (Leading and managing bids)
Capability – by sector
At Baachu, We design and implement simple, sustainable and data driven solutions every day to achieve breakthrough results for deserving businesses who address society’s most important challenges and opportunities
Our Vision is to be the world’s premier research driven, technology enabled outsourcing capability partner achieving sustainable results for our customers, building fulfilling careers for our people and earning a fair return on the value we deliver
We have organized our team into:
▪ Growth and Strategy
▪ Project Delivery and Business Winning
▪ Technology and Data Analytics
Our culture is based on five values – capability, creativity, credibility, connections and confidence. We call our values “multipliers” the combination of 5Cs that enables us to grow and serve as a powerful integrated business. These values are the essence of how we behave, what we believe, what we expect, who we are, what we deliver, and what we exist for.
Why Baachu? Baachu’s solutions aimed to integrate growth consulting, bespoke research, data analytics, subscription products, bid and capture support to enable our clients achieve their goals.