The current state of FM: is TFM the right strategy?

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Despite the fragile state of the British economy, the Facilities Management (FM) category, as a whole, remains resilient.A study carried out by MTW Research, highlighted the sector’s long term contractual nature and FM market suppliers maintaining good credit ratings, as key reasons for the category’s buoyancy. The report, which examined the state of the UK FM market, found that despite the sector’s resilience, difficult market conditions are affecting smaller single service suppliers. On the other hand, suppliers offering Total Facilities Management (TFM) solutions are increasing their market share.The Benefits of TFM strategyThe report shows that value within the FM industry is driven through longer term, sustainable strategic partnerships which continue to deliver thorough phased approaches over the contract lifecycle. In this context, TFM provides clients with reduced margins across multiple service streams and is particularly important in terms of managing the demand and level of services. These are the areas which 4C has focused on over the past year in order to successfully deliver savings.For these reasons suppliers are continuing to grow their portfolio of services, to deliver a broader and more innovative offer. However, this diversification must be carefully managed to ensure it meets the clients’ requirements. Sustainability is a critical factor within supply chain and if not evaluated effectively, could lead to disintegrating relationships on both sides.TFM and Economies of ScaleThe report concludes that economies of scale, in terms of procurement and operations, will become increasingly sought after, leading to an upsurge in M&A activity. In the same vein there will be an increase in cross-border integration and market development as FM providers look to capitalise on international economies of scale.

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