More Buildings Are Outsourcing Facility Operations

Just a generation or two ago, building owners performed nearly all facility services in-house, including cleaning. The popularity of outsourcing cleaning services since then, especially in the last few decades, has provided a huge financial opportunity not only for building service contractors, but also for facility management companies. 


As they continue to take charge of services contracts for building owners, the burgeoning presence of facility management companies is a reminder that nothing stays the same — a challenge for BSCs aiming to stay competitive, while also staying true to their values. 


“These facility management companies are taking over the world,” says Michael Knight, president of Better World Consulting, in Houston. “I’ve noticed over the past year or so, more and more BSCs customers have decided to outsource their entire facility operations to a third-party company.”


Those third-party companies tend to have a very different agenda than building owners, he says. At the top of their list? Deliver on promised savings by squeezing one of the largest controllable facility expenses: cleaning. 


“Most facility management companies tend to look at cleaning as the low-hanging fruit. From their perspective, anyone can do cleaning — it doesn’t take a rocket scientist to do it — and all cleaning companies are equally bad so let’s go beat on the cleaning companies and save some money,” Knight says. 


The evolving business landscape has placed BSCs in a unique predicament — and how contractors are choosing to deal with the changes largely comes down to market strategy. 


While some BSCs have chosen to embrace facility management companies as partners, others are working even harder to set themselves apart from the competition by proving the value of cleaning expertise. 


BSCs say one thing is clear: the emergence of facility management companies isn’t going anywhere anytime soon. 


“In the next 15 years or so, these facility management companies are looking for contractors that can take on larger geographic areas so they can reduce the number of contractors they work with,” says Eric Luke, president of Varsity Facility Services in Salt Lake City. “And they also want contractors that can do more than clean — and who are willing to do it for less.”