Avoiding Third-party Cleaning Contracts

BSCs like Don Zerivitz have decided that unless they’ve got a unique and valuable relationship with a third-party organization, they’re not going to bid on contracts with facility management companies.

“I can’t imagine you’d find too many contractors who would say that third-party work is their favorite piece of business,” says Zerivitz, president of Pro Clean Facility Maintenance in Altamonte Springs, Fla. “We’ve decided that we’re going to make it a very small part of our business — to the point that it’s almost none of our business.”

Looking back over the years since the economic downturn began, Zerivitz counts himself fortunate that the level of pricing pressure in renegotiations was significantly different between owner-occupied and third-party customers. He attributes his company’s success partially to his choice to be picky about the types of contracts it has pursued.

“What we have found is it’s very difficult to build relationships in that world, mainly because cleaning is one of the few variable costs that they have on their profit and loss statements, so we’re not considered an important vendor but rather, one to be squeezed to a certain extent, and I don’t think that’s a great place for me to build a relationship,” Zerivitz says.

It’s more important than ever to build and maintain relationships with customer contacts. No BSC can take a customer for granted — as many have learned when a third-party facility management company has taken over, invoking contract cancellation notices.

Common BSC concerns about dealing with facility management companies include instructions to cut off communications with owners in lieu of more rigid lines of communication that can only go through the third-party companies, and the extraction of additional money through various means.

“They may encourage you to join a preferred vendor club, which comes with some very steep dues, or they may ask for a rebate, or they may charge you a fee for bidding,” Knight says. “Often, this is done without the knowledge of the end user, or even at the expense of the end customer, to put more money on their bottom line. It’s very immoral, it’s shady, and I encourage contractors not to play.”