Facilities management procurement: benchmarking key trends

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facilities.jpgIn this month's SmartProcurement, Joshua Low of Purchasing Index (PI) explores some of the latest trends in facilities management.   What changes are taking place in this space?  And how are organisations, locally and internationally, adapting to incorporate these changes into their strategic plans for 2013?

Catering

A number of companies are beginning to see the staff catering facility, and quality of food on offer, as a key element in improving employee satisfaction and retention. This has lead to many of PI's clients shifting the way they describe staff catering facilities from 'canteens' to 'staff restaurants'. Some of the other trends PI has become aware of include:

  • An increasing number of caterers are investing in brand awareness exercises to increase utilisation. They are also investing in saving energy and reducing food wastage, in-line with a drive towards being more sustainable and environmentally responsible.
  • There has been an increase in outsourcing catering services to specialist catering service providers, instead of running this function internally.
  • In surveys conducted internationally, staff rate the quality of food on offer as 'essential' or 'very important', with price featuring as second or third most important.
  • Almost 70% of companies subsidise catering at their site.
  • Although 62% of companies have not received any advice about catering, 50% have carried out benchmarking to see how they compare to other companies, in terms of their pricing and how they manage their sites.
  • Caterers are increasingly investing more money into refurbishing their facilities. The key focus here has been on improving serving facilities, kitchen equipment and decor.

As per the above, it is evident that the focus has shifted away from providing cheap, fast food, to looking at ways of using catering sites and the service, ambience and quality of food as a key tool to improve employee satisfaction. This is increasingly being achieved through the use of marketing channels and a number of rebranding exercises conducted on site.

Security

Some of the key trends include:

  • Internationally there appears to be a drive to improve the 'visitor management' function - to ensure that people visiting sites have an experience in line with the image and reputation that company is trying to drive.
  • More and more companies are seeing the use of well-trained guards as fulfilling a function, or ticking a box, rather than providing a significant value-adding service. Guarding-suppliers are being pushed by corporate clients to move more to providing solutions and not just manpower. Many companies are starting to focus on integrated solutions that include making greater use of new surveillance and other security technology.
  • Forums are discussing the fact that during the day a concierge service is required over and above guarding, but at night and on weekends companies can rely more on technology than on guarding.

Cleaning

  • The new wages for cleaning staff have been announced and are effective from 1 December 2012. The rates have increased by 7 per cent to an hourly rate of R14.45. With the contract cleaning company’s additional contributions and allowances for annual leave, UIF, sick leave, etc. this calculates to a cost to company, per hour, of R18.32. Labour amounts to over 80% of the cost of cleaning so this increase will have a significant impact on cleaning costs for companies.
  • Cleaning represents 20 to 35 per cent of the total maintenance and operations budget for nearly all organisations. With contract cleaning companies constantly under pressure to do more with less, they must be prepared to justify staffing needs. This includes having accurate answers to how long it takes to complete a cleaning task and the financial and efficiency impact of changing staff frequency rosters.

There are international standards available to establish how much time it should take to clean various areas with different equipment and service providers need to get smart and assess the effectiveness of their on-site functions.

For cleaning, the key drive has been to get the service providers to be more proactive in suggesting ways they can continue to deliver an effective service, in a cost efficient manner. How does the service provider justify having the number of staff allocated on duty? How does it illustrate that the cleaning allocations and materials used are in line with the 'market'?

What is your organisation doing with regards to the above?

PI specialises in providing larger organisations across South Africa with a host of benchmarking and spend analysis services - to assist companies to better manage their facilities. If you would like more information, or would like to discuss these services in greater detail, please feel free to contact either Joshua Low on 074 703 6650 (Johannesburg) or Margie Mann on 083 650 8635 (Cape Town).

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