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

Published: 28/10/2011 / Number of Pages: 66 / Price: £795.00 £495.00

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Introduction and Overview

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.

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.

Report Summary

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.


List of Report Contents

  1. Contents Listing
  2. 1. INTRODUCTION 5
  3. 1.1 BACKGROUND 5
  4. 1.2 SOURCES OF INFORMATION 5
  5. 2. SUMMARY & FUTURE PROSPECTS 7
  6. 3. ECONOMIC ENVIRONMENT 9
  7. 3.1 GDP 9
  8. 3.2 INFLATION & INTEREST RATES 10
  9. 3.3 UNEMPLOYMENT 11
  10. 3.4 HOUSEHOLD CONSUMPTION 12
  11. 3.5 HOUSING & CONSTRUCTION 13
  12. 3.6 STERLING 14
  13. 3.7 POPULATION PROFILE 14
  14. 3.8 CONCLUSIONS 15
  15. 4. FM IN THE MANUFACTURING AND WAREHOUSING SECTORS 17
  16. 4.1 FACILITIES MANAGEMENT OUTSOURCING MARKET 17
  17. 4.1.1 Definition 17
  18. 4.1.2 FM Market Size and Trends 17
  19. 4.2 INDUSTRIAL FACILITIES MANAGEMENT OUTSOURCING MARKET 20
  20. 4.2.1 Definition 20
  21. 4.2.2 Industrial FM Market Size and Trends 20
  22. 4.2.3 Future Prospects 25
  23. 4.2.4 Industrial FM Market Mix 26
  24. 4.2.5 Industrial FM Services 26
  25. 4.3 KEY MARKET INFLUENCES 31
  26. 4.3.1 Manufacturing and Warehousing Construction Output 31
  27. 4.3.2 Performance of the Manufacturing Sector 33
  28. 4.3.3 Performance of the Warehousing Sector 35
  29. 4.3.4 Legislation 37
  30. 5. KEY INDUSTRIAL END USER SECTORS 40
  31. 5.1 END USER MIX 40
  32. 5.2 MANUFACTURING FM 41
  33. 5.2.1 Market Size and Trends 41
  34. 5.2.2 Services and Service Provision 43
  35. 5.3 WAREHOUSING FM 46
  36. 5.3.1 Market Size and Trends 46
  37. 5.3.2 Future Prospects 47
  38. 5.3.3 Services and Service Provision 47
  39. 6. CONTRACTORS REVIEW 49
  40. 6.1 ORIGINS AND SUPPLY STRUCTURE 49
  41. 6.2 MARKET SHARES 51
  42. 6.3 LEADING FM CONTRACTORS IN MANUFACTURING AND WAREHOUSING 52
  1. Tables & Charts
  2. CHART 1 UK FM OUTSOURCING MARKET WITHIN THE MANUFACTURING AND WAREHOUSING SECTORS AT CURRENT PRICES 2005 - 2015 7
  3. CHART 2 INTEREST RATES AND INFLATION (CPI) FROM 1992-2015 11
  4. CHART 3 PDI & SAVINGS RATIO AT CURRENT PRICES 1992-2015 12
  5. TABLE 4 EXCHANGE RATE FLUCTUATIONS 2006-2011 - STERLING TO THE DOLLAR, AND THE EURO, SPOT RATES 14
  6. CHART 5 AGE DISTRIBUTION OF THE RESIDENT UK POPULATION MID-2008 ('000) 15
  7. CHART 6 UK BUNDLED FM OUTSOURCING MARKET AT CURRENT PRICES 2005-2015 (£ BILLION) 18
  8. TABLE 7 UK MANUFACTURING AND WAREHOUSING BUNDLED FM OUTSOURCING MARKET 2005-2015 (AT CURRENT PRICES) 21
  9. CHART 8 MANUFACTURING AND WAREHOUSING FM MARKET MIX BY VALUE 2010 (%) 26
  10. TABLE 9 LEADING 10 HEATING, VENTILATING, AIR CONDITIONING, AND REFRIGERATION CONTRACTORS BY TURNOVER 2010 30
  11. TABLE 10 INDUSTRIAL CONSTRUCTION NEW WORK OUTPUT 2005 - 2015 (£M) AT CURRENT PRICES 32
  12. TABLE 11 CONSTRUCTION NEW ORDERS 2005 - 2010 (£M) AT CURRENT PRICES - MANUFACTURING AND WAREHOUSING SECTORS 33
  13. CHART 12 PERFORMANCE OF THE MANUFACTURING SECTOR - TURNOVER 2005-2009 33
  14. TABLE 13 THE MANUFACTURING INDUSTRY (£M) 2005-2009 34
  15. TABLE 14 THE MANUFACTURING INDUSTRY BY SECTOR (£M) 2009 35
  16. CHART 15 PERFORMANCE OF THE WAREHOUSING SECTOR - TURNOVER £M 2005-2009 36
  17. TABLE 16 THE WAREHOUSING AND STORAGE INDUSTRY (£M) 2005-2009 37
  18. CHART 17 UK MANUFACTURING AND WAREHOUSING FM - MIX BY END USE APPLICATION BY VALUE - 2010 (AUTOMOTIVE, CLOTHING, FOOD/DRINK, WOOD, CHEMICALS, METAL, ELECTRICAL, WAREHOUSING ETC) 40
  19. TABLE 18 UK MANUFACTURING MARKET FOR BUNDLED FM OUTSOURCING 2005-2015 (CURRENT PRICES) 41
  20. TABLE 19 ESTIMATED SERVICE MIX IN OUTSOURCED FM IN THE MANUFACTURING SECTOR (CLEANING, BLDG & ENG, CATERING ETC) 2009/10 43
  21. TABLE 20 UK WAREHOUSING MARKET FOR BUNDLED FM OUTSOURCING 2005-2015 (CURRENT PRICES) 46
  22. TABLE 21 ESTIMATED SERVICE MIX IN OUTSOURCED FM IN THE WAREHOUSING SECTOR (SECURITY, CLEANING, CONSULTANCY, CATERING ETC) 2009/10 47
  23. TABLE 22 TOP 20 FM SUPPORT SERVICES COMPANIES IN THE UK 51

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