UK Facilities Management Market - Baachu Rain · Compass ISS ENGIE Babcock International Group Plc Serco Capita Business Services Limited Integral + JLL G4S Amey EMCOR City FM CBRE

UK Facilities Management Market

1

Baskar Sundaram

2

Who is Baachu?

Industry

Defence

Healthcare

Education

Transport

Aviation

Justice & Immigration

Energy

Many more...

Waste Management

Service

Customer Relationship Management

Facilities Management

Operations & Maintenance

Business Process Management

Procurement

Baachu is a leading UK strategy advisory focussing on frontline outsourcing services ; we specialise in growth consulting, research and transformation services

Expertise MBAs 100+ projects>250,000+ hours

Avg. Exp.8+ years

Europe, APAC & Middle East

Supporting CEOs/ CFOs/ COOs/ Business Leaders

Network of experts

Introduction

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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

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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


Transport

Leisure


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

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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


Leisure

Retail


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

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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

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Sources:1. Web Search

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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’


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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).


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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


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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


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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


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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.

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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

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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

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Pro

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▪ 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.

Documents

UK Facilities Management Market - Baachu Rain · Compass ISS ENGIE Babcock International Group Plc Serco Capita Business Services Limited Integral + JLL G4S Amey EMCOR City FM CBRE