by Shane Henson — November 23, 2011—AMA Research, a provider of market research to the U.K. building and construction industries, has released a new report that details trends and developments in facilities management outsourcing in the U.K industrial sector.
According to information provided in Facilities Management Outsourcing-Industrial Sector Report-UK 2011-2015 Analysis, after significant growth between 2005 and 2007, measured by contract value, the FM market for manufacturing and warehousing slowed through to 2009. It is estimated that the market continued to decline over the period 2010 and 2011. Positive but modest growth is forecast in 2013 and 2014. Slightly more positive conditions are expected in 2015, although still constrained by continuing sluggish growth in the economy.
Manufacturing represents by far the largest end user within this market, notes the report, although there has been more recent expansion in use of FM services within warehousing. However, it is estimated that the U.K. warehousing FM market still only accounts for about 2% of the combining manufacturing and warehousing FM market in 2010, measured by contract value.
Food and drink manufacturing represents the largest end-use sub sector, with an estimated 23% of the market by value, followed by automotive, aerospace and other transport equipment with 15% of market share.
The recession has been a major driver for change in the U.K. FM market for manufacturing and warehousing end users, as companies restructure and look to reduce costs, according to the report. Both the manufacturing and warehousing sectors face extreme pressures on margins, which has impacted on capital investment programs, both for new build facilities and maintenance spend. Given this, there is an increasing focus on maximizing the value of built assets and production systems. This has manifested itself in relation to a number of different aspects of FM contracts, including:
- Maintenance, repair and overhaul (MRO): It is becoming more common among industrial companies to include the installation and maintenance of production equipment within FM service contracts.
- Energy management: Energy costs are and will remain one of the highest production costs for every industrial operation. Increasingly, industrial companies have turned to FM providers to help minimize these costs. Increasingly stringent regulations on carbon emissions are also driving changes in practices in relation to energy management, and this is becoming an increasingly important area of FM contract growth.
- Regulatory compliance: Managing the process safety management lifecycle and compliance environment within industrial settings is becoming increasingly complicated as the regulatory framework impacting on manufacturing and warehousing becomes more stringent. This is also the case with respect to the need to comply with more complex and demanding waste disposal and management regulations.
- Monitoring of production and facilities: In order to ensure product quality there is an increasing need to effectively monitor and regulate air, water and temperature quality at production and storage facilities.
- Energy management: Energy costs are and will remain one of the highest production costs for every industrial operation. Increasingly, industrial companies have turned to FM providers to help minimize these costs. Increasingly stringent regulations on carbon emissions are also driving changes in practices in relation to energy management, and this is becoming an increasingly important area of FM contract growth.
