Fm market competitive landscape

1. Copyright © 2020 by Baachu
FM Market Competitive
Landscape (UK)
Market Report

2. Copyright © 2020 by Baachu
UK FM Market – Profitability vs Turnover (2019)
UK FM Market by Stream: Cleaning Services, M&E and
Integrated FM
AI based bottom up analysis of the UK Facilities Services
Market
“Recession” mindset of FM CEO, FM Strategy/Marketing
Director and FM Sales & Business Development Director
Table of Content
Top 15 FM Players in UK FM Market
Top 15 FM Players in UK FM Public Sector Market
Top 15 FM Players in UK FM Private Sector Market

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3
UK FM Market – Profitability vs Turnover (2019)
Source:
1. Company Website, Annual Report, News Articles
[CELLRANGE]
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0
10,000
20,000
30,000
40,000
50,000
60,000
-6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0%
Revenue
(£
Mn)
Operating Margin (%)
UK FM Market - Top 16 PlayersA
Profitability vs Turnover 2019
Vinci had a high operating
margin of 11.8% in 2019
Interserve witnessed an
operating margin (loss) of
(0.2)% in 2018 and was
overtaken by its lenders in
2019
Most of the top FM Providers in
the UK had a profitability range
between 2% to 7% during the
period
Note:
A. As per TCV of all the contracts of each FM Provider
B. Interserve’s Revenue and Operating Margin are for the year ending 31st
December 2018

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UK FM Market Competitive Landscape
UK FM Market is a matured one with copious opportunities in both the public and private domain. Both COVID-19 pandemic and
Brexit have led to a potential loss in market growth in near term, however, the sector is expected to bounce back with more
outsourcing opportunities created in FM outsourcing market.
Type of FM Services
 Hard FM: Building services control & management systems, Fire protection systems, Fire alarm & detection systems, asset
management, mechanical services, electrical services, plumbing energy management, escalator maintenance, flooring, etc.
 Soft FM: Cleaning, catering/ food services, janitorial, laundry, patient transport, portering, parking, vending, waste
management, courier services, laundry services, reception staffing, security and safety, landscaping, pest control, etc.
 Integrated FM: includes both Hard and Soft FM.
Key FM Players in UK FM Market
 UK FM Market is highly fragmented with top 15 players holding ~40% share of overall FM market and remaining held by
other players.
 Mitie leads the FM services market with TCV of ~£17 Bn, followed by Interserve (~£6.8 Bn) and Engie (~£4.6 Bn).
− Mitie Group is the largest provider of Soft FM, Hard FM, and Integrated services in the UK FM market, with share of
~14.2%, 6.6% and ~22.0% respectively.
− In the Private Sector, Mitie Group has secured the highest number of contracts from Offices (51.9%) and in Public Sector,
the company caters mainly to Central Government (33.1%).
Top 15 FM Players
14.5%
5.8%
3.9%
3.3%
3.2%
2.7%
1.5%
1.4%
1.2%
1.0%
1.0%
1.0%
0.9%
0.8%
0.8%
57.1%
Mitie Interserve ENGIE Compass Sodexo ISS Serco CBRE
EMCOR G4S OCS Vinci Facilities Integral Skanska Kier Others
Total UK FM Market Share
(TCV) = ~£117.0 Bn
Source:
1. Baachu RAIN Database dated 16 Dec 2020
Note:
A. The liquidation of Carillion in Jan 2018 impacted the UK FM Market, however,
most of the contracts were awarded to other FM Providers. Hence, its contracts
were considered to calculate the market size
B. Others also includes contracts that were awarded to multiple vendors
C. Mitie has acquired Interserve’s FM division in Dec. 2020; the impact has not
been included in current analysis

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Top FM Players in UK FM Public Sector Market
 Interserve leads the UK FM Public Sector Market with TCV of ~£3.3 Bn, followed by Mitie (~£1.8 Bn) and Engie (~£1.7 Bn).
− Interserve is the 2nd largest integrated FM providers in the UK with a market share of 11.4%.
− In the Public Sector, the company caters mainly to Central Government (50.1%), Energy and Utilities (18.2%) and
Education (13.1%).
Top FM Players in UK FM Public Sector
Source:
1. Baachu RAIN Database dated 16 Dec 2020
5.9%
3.1% 3.2%
2.7%
2.2%
1.8%
1.6%
1.3%
1.0% 0.9%
0.9%
0.9%
0.7%
0.4%
0.4%
73.1%
Interserve Mitie ENGIE Sodexo Serco Compass Skanska ISS
G4S OCS CBRE Mears Group Atalian Servest Morgan Sindall Kier Others
Total UK FM Market Share
(TCV) = ~£58.4 Bn

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Top FM Players in UK FM Private Sector Market
 Mitie leads the UK FM Private Sector Market with TCV of ~£14.9 Bn, followed by Interserve (~£3.3 Bn) and ISS (~£2.3 Bn).
− In the Private Sector, Mitie Group has secured the highest number of contracts from Offices (51.9%), followed by
Manufacturing & Industrial (11.8%) and Energy and Utilities (10.9%) sectors.
Source:
1. Baachu RAIN Database dated 16 Dec 2020
25.9%
5.7%
4.7%
4.6%
4.0%
3.7%
2.2%
2.0%
1.7%
1.7%
1.2%
1.1%
1.1%
0.9%
0.9%
38.6%
Mitie Interserve Compass ENGIE ISS Sodexo EMCOR CBRE Vinci Facilities Integral OCS Kier G4S Serco JLL Others
Total UK FM Market Share
(TCV) = ~£58.6 Bn
Top FM Players in UK FM Private Sector

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UK FM Market by Stream – Cleaning Services
Source:
1. Rain FM Database
2. Baachu Analysis
44.8%
9.2%
8.8%
6.6%
6.0%
5.4%
19.1%
Market Sectors - Cleaning
Office Health Care
Manufacturing & Industrial Retail
Central Government Transport
Others
Total Cleaning Services
FM Market = £21.3 Bn
32.4%
11.0%
6.0%
4.6%
3.8%
3.8%
38.3%
Top FM Players: Cleaning
Mitie Interserve ISS Serco
EMCOR Sodexo Others
UK FM Market by Stream – Cleaning Services (2020)
Total Cleaning Services
FM Market = £21.3 Bn
 In the Public Sector, the Health Care is the
largest procurer of cleaning services, with
total contracts worth ~£2.0 Bn
(accounting for ~33.2% of the market),
followed by the Central Government
(21.5%) and the Local Government
(15.1%) sectors
 In the Private Sector, Office is the largest
sector opting for cleaning services with
total contracts worth ~£9.6 Bn
(accounting for ~61.9% of the market)
rolled out to the service providers,
followed by Manufacturing & Industrial
(12.2%) and Retail (9.1%) sectors
 Mitie is the largest cleaning services
provider in the UK FM Market accounting
for ~32.4% of the market share, followed
by Interserve (11.0%) and ISS (6.0%).
Others includes Defence, Education, Energy and Utilities, Local Government, Residential and Housing, Property Management and
Leisure
Note:
A. The liquidation of Carillion in Jan 2018 impacted the UK FM Market, however,
most of the contracts were awarded to other FM Providers. Hence, its contracts
were considered to calculate the market size
B. Others also includes contracts that were awarded to multiple vendors
C. Mitie has acquired Interserve’s FM division in Dec. 2020; the impact has not
been included in current analysis
Source: Baachu RAIN Database dated 20 Dec
2020
Source: Baachu RAIN Database dated 20 Dec
2020

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8
UK FM Market by Stream – M&E Services
Source:
1. Rain FM Database
2. Baachu Analysis
 In the Public Sector, the Central
Government is the largest procurer of
M&E services, with total contracts worth
~£1.5 Bn (accounting for 46.4% of the
market), followed by Residential and
Housing (20.8%) and Local Government
(13.0%)
 In the Private Sector, Office is the largest
sector opting for M&E services with total
contracts worth ~£8.9 Bn (accounting for
~68.2% of the market) rolled out to the
service providers, followed by Energy and
Utilities (10.1%) and Manufacturing &
Industrial (10.1%) sectors
 Mitie is the largest M&E services provider
in the UK FM Market accounting for
~37.4 % of the market share, followed by
Interserve (5.9%) and EMCOR (5.2%)
54.7%
10.0%
9.1%
8.1%
5.2%
3.1%
9.8%
Market Sectors - M&E
Office Energy and Utilities
Central Government Manufacturing & Industrial
Residential and Housing Transport
Others
37.4%
5.9%
5.2%
2.7%
2.3%
3.0%
43.5%
Top FM Players: M&E
Mitie Interserve EMCOR Sodexo
Integral CBRE Others
Total M&E FM Market
= £16.3 Bn
Total M&E FM Market
= £16.3 Bn
UK FM Market by Stream – M&E Services (2020)
Note:
A. The liquidation of Carillion in Jan 2018 impacted the UK FM Market, however,
most of the contracts were awarded to other FM Providers. Hence, its contracts
were considered to calculate the market size
B. Others also includes contracts that were awarded to multiple vendors
C. Mitie has acquired Interserve’s FM division in Dec. 2020; the impact has not
been included in current analysis
Others includes Defence, Education, Local Government, Property Management, Retail and Leisure
Source: Baachu RAIN Database dated 20 Dec
2020
Source: Baachu RAIN Database dated 20 Dec
2020

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42.2%
12.5%
7.8%
7.3%
5.1%
5.1%
19.9%
IFM Market Sectors
Office Central Government
Manufacturing & Industrial Energy and Utilities
Local Government Defence
Others
9
UK FM Market by Stream – Integrated FM
Source:
1. Rain FM Database
2. Baachu Analysis
 The total IFM market in the UK is
estimated at ~£41.8 Bn in terms of TCV,
accounting for 35.7% of the total UK FM
Market
 In the Public Sector, the Central
Government is the largest procurer of IFM
services, with total contracts worth ~£5.2
Bn (accounting for ~34.1% of the
market), followed by Defence (14.0%)
and Health Care (13.7%)
 In the Private Sector, Office is the largest
sector opting for IFM services with total
contracts worth ~£17.4 Bn (accounting
for 65.8% of the market) rolled out to the
service providers, followed by
Manufacturing & Industrial (12.4%) and
Energy and Utilities (10.9%)
 Mitie is the largest IFM player in the UK
FM Market accounting for ~21.9% of the
market share, followed by Interserve
(11.8%) and Engie (5.1%)
Total IFM Market
= £41.8 Bn
21.9%
11.8%
5.1%
4.1% 3.4%2.9%
50.9%
Top IFM Players
Mitie Interserve Engie ISS
Total IFM Market
= £41.8 Bn
UK FM Market by Stream – Integrated FM (2020)
Note:
A. The liquidation of Carillion in Jan 2018 impacted the UK FM Market, however,
most of the contracts were awarded to other FM Providers. Hence, its contracts
were considered to calculate the market size
B. Others also includes contracts that were awarded to multiple vendors
C. Mitie has acquired Interserve’s FM division in Dec. 2020; the impact has not
been included in current analysis
Source: Baachu RAIN Database dated 20 Dec
2020
Source: Baachu RAIN Database dated 20 Dec
2020
Others includes Defence, Education, Residential and Housing, Transport, Retail, Property Management and Leisure

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AI based bottom up analysis of the UK Facilities Services Market
 Market intelligence activities are critical for executives to understand the total and
addressable markets. The exercises are typically commissioned/ undertaken by executive
leaders in multiple business functions for various objectives – Sales and marketing;
business development; corporate and operational strategy etc.
 For the UK FM Market, Baachu has preferred the Bottom-up analysis approach in a bid to
present the most comprehensive outlook of the market
 Unlike most other sources with similar offerings, Baachu’s market sizing is based on the
most comprehensive list of actual FM contracts awarded in the UK market public and
private
 Our advanced Web crawling technology searches that recognize inputs, display relevant
searches, predict results on relevance and return a ranked output.
 We also track social media to know what people are saying about your
brand/business/services and competitors
Bottom-up approach
 The bottom-up approach necessitates scanning and listing down the contracts/ deals signed in a
particular sector/ industry
 Depending on the geography/ sector, the contracts are typically scanned from multiple sources including:
− Government databases (TED Europa, Contracts Finder etc.)
− Company websites and social media
− Industry bodies (i-FM, FM Journal)
− News aggregators
− News agencies
− Company blogs
 The contracts data could be sporadic and non-linear in nature and has to be subjected to data building
techniques for effective analysis
 Data analysis techniques are applied to the contracts database to reach the market size values
Methodology

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Inside the “recession” mindset of FM CEO
Market
 How to get an independent view of the market?
 What are the adjacent markets?
 Is my competitors edging past at the marketplace?
 How to gain and manage investments?
Growth
 How am I going to maintain margins?
 How can my company grow profitably?
 Should we grow organically or through acquisition?
 Is my company (esp. support functions) ready for growth?
Growth
 Does my company has resources to plan and execute growth
strategy?
 What can I do to reduce costs?
 How can I restructure my operations?
 How to plug revenue leakage?
Pain
Points
Support Provided
 Size of target & adjacent markets (bottom-
up approach)
 Insight board room sessions
 Regular bitesize updates on competitors
(weekly/ monthly)
 Acquisition target identification and
assessment
 Strategy, bid, commercial and change
management experts to fill resource gaps
 Benchmark market position
Tools
Many
more…

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Inside the “recession” mindset of FM Strategy or Marketing
Director
Market
 What is the size of my target & potential markets?
 Is the competitive landscape changing?
Customer
 How to identify the target customer and generate
demand?
 How to reach my customer (digital or traditional mode) to
build brand awareness?
Capability
 Identify the gap in existing offerings?
 How to strengthen and market my company’s existing
capabilities?
 How to measure brand loyalty ?
Pain
Points
Support Provided
 Assessment of target and potential markets
 Formulate market entry strategy
 Competitive landscape & benchmarking
 Identify target customers
 Draft and implement “Reach” strategy
(Digital/ Traditional)
 Capability assessment & benchmarking
 Thought leadership
 Monitor your brand
Tools
Many
more…

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Inside the “recession mindset” of the FM Sales & Business
Development Director
Sales Target
 How to achieve my in-year revenue target?
 How to reach and have conversation with my
prospects ?
Sales Development
 Will opportunities in existing pipeline able to meet year’s
target?
 How to strengthen my existing pipeline?
Win Rate
 How to improve win rate?
 Do I have the right capacity in my bid team able to focus on
both rebids and new opportunities?
Pain
Points
Support Provided
 Bid Intelligence & qualification
 Pipeline Booster
 Capture Strategy
 Independent Reviews (proposal, people,
pipeline & commercial model)
 Bid, capture, commercial and change
management experts to fill resource gaps
 APMP Certification Training
Tools
Many
more…

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In times of uncertainty leaders need data to make decisions. We
unlocked our vault FREE…
 Covid19 specific FM market insights
https://baachurain.com/covid-19/
 Market Awareness
Webinars
− By Market Sectors
(Public and Private)
− By Market Services
(Hard, Soft, Support)
https://baachurain.com/even
ts/

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Showcasing human leadership stories with Baachu Talk
 I dedicate Baachu Talk to these leaders who are collectively making a difference to our society. Listen in
and get to know them personally.
 https://www.baachu.com/baachutalk-podcast/

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At Baachu, we design and implement simple, sustainable and data driven outsourcing
solutions every day.
We have organized our team into:
 Growth and Strategy
 Learning and Development
Our culture is based on five values – capability, creativity, credibility, connections and
confidence. These values are the essence of how we behave, what we believe, what we expect,
who we are, what we deliver, and what we exist for.
Baskar Sundaram
Trusted Advisor to Facilities Service Providers
Website: www.baachurain.com and www.baachuscribble.com
Phone: 0203 574 8855
Mobile : 0771 819 3599
Email: baskar@baachu.com

17. Copyright © 2020 by Baachu
At Baachu, we design and implement simple, sustainable and data driven outsourcing solutions every
day.
Our vision is to be the world’s premier research driven, technology enabled outsourcing capability
partner achieving sustainable results for our customers, building fulfilling careers for our people and
earning a fair return on the value we deliver.
Our culture is based on five values – capability, creativity, credibility, connections and confidence. We
call our values “multipliers” - the combination of 5Cs that enables us to grow and serve as a powerful
integrated business. These values are the essence of how we behave, what we believe, what we expect,
who we are, what we deliver, and what we exist for.
Why Baachu?
Baachu’s solutions aim to integrate growth consulting, bespoke research, data analytics, subscription
products, bid and capture support to enable our clients achieve their goals.
Contact:
Baskar S Sundaram
Director, Baachu
11th Floor, Sussex Innovation, No.1
Croydon, 12-16 Addiscombe Rd,
Croydon CR0 0XT
0771 819 3599
020 818 13602
baskar@baachu.com