Published: Apr, 2017
The competitive landscape of the global market for facilities management is fragmented, finds Transparency Market Research (TMR) in a new study. The four leading companies, Broadspectrum Pty Limited, ISS World Services, Bilfinger HSG Facility Management GmbH, and Sodexo, Inc. jointly accounted for a share of 28% in the global market for facilities management during 2015. “As acquisitions and mergers are conducted on a cross-border level, vast opportunities will enable several market players to expand their customer networks and regional coverage”, says a TMR analyst.
A number of players are opting for partnerships, mergers, and acquisitions to establish a strong presence in the global market for facilities management. For instance, in 2015, Bellrock Property & Facilities Management Limited signed two different contracts, one with HUGO BOSS UK in July and another with, EAT, in July. Similarly, in April 2016, Bilfinger HSG Facility Management GmbH entered an agreement with AbbVie, Inc., in order to supply infrastructural and technical facility management services.
The global market for facilities management was pegged at US$606.4 bn during 2015 by the TMR report. By the end of the forecast period in 2024, the market is expected to attain US$1,887 bn, expanding rapidly at a stout CAGR of 13.6%.
Growing Demand from Residential, Educational Sectors in Asia Pacific to Promote Growth
Asia Pacific is slated to exhibit fast growth over the forthcoming period, thanks to the rapid advancement of residential and educational sectors. These domains are displaying increasing demand for soft services such as cleaning, catering, pest control, mailroom, security, and waste management. The facilities management market in the region is likely to achieve a revenue worth US$437.1 bn by the end of 2024. Europe emerged as the leading segment of the global market for facilities management.
By end user, the corporate industry was the dominant segment, holding a share of 21.2% in the global facilities management market during 2015. A range of support solutions offered to the corporate sector such as cafeteria operations, supplies management, bill payments, helpdesk services, and mailroom management at affordable rates has been a key driver of the market.
Concerns Regarding Energy Consumption to Generate More Demand
Reduction of costs is a key area of concern for residential, educational, manufacturing, and corporate sectors. High quality services such as maintenance, cleaning, and security are offered by facilities management services at reasonable costs. Therefore, the economic burden that has to be borne by several companies can be significantly reduced, thereby boosting the overall performance of the companies at the same time. The reduced amount of capital expenditure can be directed in more productive activities. As a result, a number of enterprises are opting for long-term, short-term, and medium-term facilities management services.
However, facility management services often results in high consumption of energy, which is a key obstacle limiting their scope of application across various industries. Furthermore, high consumption of energy can result in high operating costs. If an integrated design is developed for business operations, facilities management can be instrumental in bringing down the overall power usage of the business, improving the productivity of the firms.
On the other hand, as several small facilities management providers are offering services at lower costs, larger companies are compelled to lower their operating standards. This might inhibit the growth of the market. Other major restraints faced by the market are the inadequacy of skilled manpower and rising costs of labor. However, the establishment of cross-border mergers and acquisitions is likely to create major growth opportunities across multiple regions.
The information presented in this review is based on a Transparency Market Research report, titled, “Facilities Management Market (Service Type - Hard Services, Soft Services; Industry -Corporate, Government and Public Sector, Healthcare, Manufacturing, Residential and Education Institutions, Retail and Commercial) - Global Industry Analysis, Size, Share, Growth, Trends and Forecast 2016 - 2024”.
Key segments of the Global Facilities Management Market
Facilities Management Market, By Service Type
- Hard Services
- Soft Services
Facilities Management Market, By Industry
- Government and Public Sector
- Residential and Education Institutions
- Retail and Commercial
- Others (Food, Sport, etc.)
Global Facilities Management Market, by Geography
- North America
- The U.S.
- Rest of Europe
- Asia Pacific (APAC)
- Rest of APAC
- Middle East and Africa (MEA)
- Saudi Arabia
- South Africa
- Rest of MEA
- Latin America
- Rest of Latin America
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