Facilities Management Outsourcing: Manufacturing and Warehousing Sector Report – UK 2011-2015 Analysis

AMA Research are pleased to announce the publication of the 1st edition of AMA Research’s market report: ‘Facilities Management Outsourcing: Manufacturing and Warehousing Sector Report - UK 2011-2015 Analysis’. The report offers a unique review of this sector valued at around £1.03bn, focusing on the outsourced management and delivery of non-core services within industrial end-use sectors including industries such as engineering, food processing, chemicals, pharmaceuticals and warehousing services. Key areas covered by the report include: Specific Analysis of FM Outsourcing market within the Industrial sector - sector sizes & trends, key market influences, penetration of FM outsourcing, end user mix by sector, forecasts and potential opportunities as the market sector recovers. Review of Key Industrial Application Areas - sector sizes, key market influences and trends, implications for FM providers, future prospects and areas of opportunity for FM provision. Review of Market Structure and Leading Providers - changing supply structure, diversification of service provision and company profiles for the leading contractors within the manufacturing and warehousing sector. The Industrial FM Outsourcing Market has followed the patterns of many industries with strong performance in the middle of the decade followed by weaker performance as the impact of the financial crisis and economic stagnation set in. The report contains a detailed assessment of these and other market trends and influences, with analysis of future prospects and potential areas of opportunity, identifying those within certain industrial end-sectors. Areas of particular interest: Market activity within the Industrial FM sector from 2005 to 2010, with forecasts through to 2015. Impact of economic downturn on contract sizes and nature of service provision in the industrial sector. Identification of a number of niche sector application areas expected to provide opportunities for FM providers over the next few years.  Some of the companies included: Atkins Facilities Management, Balfour Beatty Workplace, Carillion Facilities Management, CH2M Hill, Cofeley, Dalkia, EC Harris Solutions, Emcor Facilities Services, Eric Wright Plc, Faceo FM UK, Fluor, Gardiner & Theobald Facilities Management, Incentive FM, Initial Facilities Management, Integral UK, Interserve Facilities Management, Invensys Operations Management, Inviron, Johnson Controls, Keir Facilities Services, MITIE Plc, OCS Group, Reliance Facilities Management, Rockwell Automation, SDI Group Ltd, Sodexo Facilities Management, URS Corporation, Veolia Environmental Services UK, Vinci Facilities. Key areas covered in the report include: FM OUTSOURCING WITHIN THE INDUSTRIAL SECTOR Review of Industrial FM Outsourcing market - estimates of market size from 2005-2010, with forecasts for the period from 2011 to 2015. Key market influences - macroeconomic factors, construction output, performance of the manufacturing sector, impact of the recession and legislation. Growing influence of energy costs and environmental legislation and increasing awareness of FM services in particular end use sectors. Future opportunities and threats. Market mix among Industrial End Use Application Areas - Including Food and Drink, Automotive and Aerospace, Chemicals, Electrical, Pharmaceuticals and Warehousing. Penetration of Outsourcing in the Industrial sector. KEY INDUSTRIAL END USE SECTORS Manufacturing - sector performance, key influences, future prospects and opportunities. Services and key service providers together with FM service demands within key manufacturing sub sectors. Warehousing - sector performance, key influences, future prospects and opportunities. Services and key service providers together with FM service demands within key manufacturing sub sectors. CONTRACTORS REVIEW Review of origins of FM companies and Supply Structure. Market shares of leading FM providers. Market profiles for leading FM providers to Industrial Application areas, covering over 25 major providers and niche specialists - outline includes company size, growth trends, areas of specialisation, sector strengths and major contracts. THE OVERALL FM OUTSOURCING MARKET Overview of the overall FM Market - estimates of total market size from 2005-2010, with forecasts for the period from 2011 to 2015. Key market influences and future prospects - macroeconomic factors, diversification in service provision, increasing maturity in a number of end use sectors, trend towards TFM and ‘bundling’, public sector spending and legislative influences.

Additional Information

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. This has contributed to a market value for outsourced ‘bundled’ services and TFM within the manufacturing and warehousing market of about £1.03bn in 2010. 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, although there has been more recent expansion in use of FM services within warehousing. However, it is estimated that the UK warehousing FM market still only account 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 FM market for manufacturing and warehousing end users, as companies restructure and look to reduce costs. Both the manufacturing and warehousing sectors face extreme pressures on margins, which has impacted on capital investment programmes, both for new build facilities and maintenance spend. Given this, there is an increasing focus on maximising 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 amongst 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 minimise 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.

A range of other services are also provided including portering, reprographics, reception, helpdesk, pest control, design, build and costing support, project management, heating, ventilation and air conditioning (HVAC), labour recruitment, emergency management and non production related electrical and mechanical maintenance.