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Contracting Profits



Cover Story

Customer Feedback: Facility Managers Weigh In

By Lisa Ridgely, Deputy Editor of Contracting Profits
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Building service contractors don’t have to be told that the recession changed the contract cleaning industry — in some cases, permanently. There may be no going back to the daily cleaning and vacuuming specs of five years ago. Instead, greater labor efficiencies through chemicals, products and technology will increasingly be an ingredient to success. Green cleaning may never incite the same kind of excitement it did when it first bowled onto the industry scene.

Yet the evolutionary theory that it is those most responsive to change, not the strongest nor the most intelligent, who will survive, is, in many ways, proven true during tough times — and some may argue that it takes all three of those traits to truly succeed in this industry.

A recent survey of facility and property managers by Contracting Profits magazine shows that the recession’s effects are still being felt by purchasing departments, and that the emphasis on green cleaning has taken a back seat to clean and sanitary environments and appearances.

The silver lining, however, is that relationship-building seems to have grown more important during the lean times. Even though profit margins have dipped for many building service contractors, loyalty to customers and dedication to providing quality services as well as education about sustainable processes are paying off.

Working with facility managers on bidding and accounts also demands a level of proactivity from BSCs as far as communication, education and service. Facility managers want partners who understand the roles of everyone involved and what is being asked of them.

“We manage buildings and we do it very well,” says James Vetter, vice president and national account executive at Santa Ana, Calif.-based Grubb & Ellis, a commercial real estate advisory firm. “A lot of cleaning companies are trying to become everything to everybody, so it’s a challenge to find that right company.”

Vetter is based in Southfield, Mich., where he oversees a 2-million-square-foot auto manufacturing plant. The auto company has been outsourcing facility services there for more than a decade, and Vetter faces the same responsibilities and pressures that BSCs do: to provide superior cleaning services for less money.

 

A balancing act

The clients of property management firms are no different than customers BSCs deal with directly. They are bottom-line driven, which requires a great deal of business diplomacy, and facility managers have to meet purchasing department heads and other client decision-makers in the middle.

Any relationship a BSC has with a customer or facility manager is based on the needs of clients and the parties’ mutual desires to receive services at a certain price point. Whereas some facility managers, like Vetter, have found success working with national building service contractors that have been able to provide service on a level appropriate for their client, others prefer to hire contractors that are smaller and local.

Paul Wagner, corporate facilities manager for Church Mutual Insurance Co. in rural Merrill, Wis., says his company appreciates working with a local contractor.

“The owner of the company will stop by if there’s a problem — not a sales rep,” Wagner says. Also, new specs and procedures can be created in an instant.

Not only are top execs more accessible, but there are community ties that happen in smaller, tight-knit regions. For instance, many of Church Mutual’s employees know or are even related to janitorial staff who clean its headquarters building.

“Church Mutual has been a local company for over 115 years, and we are the largest employer in the city,” Wagner says, with about 700 employees working at the headquarters.

The “buy local” movement that has become popularized in relation to food sustainability applies for Church Mutual. Whereas with larger contractors, it may be harder to know where a client’s money is going, hiring a local BSC is sure to help the local economy.

“It is important to keep money local for the health of the local economy,” Wagner says.

No matter whether a facility manager is dealing with a small, local BSC or a branch of a huge national contractor, responsiveness and communication are the most important ingredients of a loyal relationship. According to the survey, the majority of facility managers want to meet with their cleaning provider one to four times a month. Knowing that a BSC is a part of the team that is working together for the greater good of the facility is what the best partnerships are made of.

“My feeling is, that’s an extension of the service I’m providing to my tenants, and I have to be confident of my vendor who is present in every tenant space every night,” says Laura Crosby, property manager for Phoenix-based Gaedeke Group LLC.

Crosby is in daily contact with her BSC’s managers and supervisors, and expects a high level of responsiveness when it comes to common issues or problems that pop up. But there are some services that aren’t written into contracts, and some circumstances that can’t be anticipated, and how a contractor responds during trying times can make the difference when it comes to contract renewals.

“I had a huge microburst affecting my building in 2009 — it happened to be Labor Day weekend, so most of my staff was out of town, I was here at 3 a.m., it looked like a warzone,” Crosby says. “I look up, and there’s the president of my janitorial staff, coming in saying, ‘Do you need help?’”

Vendors who care about the facility, and about helping out property managers, are more likely to care about their own employees as well, which speaks to the team mentality that Crosby has created.

A vast majority, 86 percent, of respondents say it is important or very important that janitors who work in their buildings are paid a living wage. Knowing that janitors are well-compensated contributes to the overall social health of the building, because appreciated employees are happy ones.

“Compensation for them is very important to us,” Crosby says. “There are certain vendors who aren’t really worried about the people they’re placing in the building, but that will actually backfire on them. If you’re not getting the service you need or you can trust the people in your building, then you’re not going to use that vendor.”

The happier a BSC’s employees are, the less likely they are to leave — and turnover costs affect the bottom line for the entire account, Vetter points out.

“Low turnover is what makes us all money, because every time you have to train a new employee it just takes more money out-of-pocket,” Vetter says.

The most common contract length, according to survey respondents, is a one-year contract, though almost one-third of respondents said their standard contracts are three years. Ninety-six percent said they include a 30-day cancellation policy that allows them to opt out.

Some facility managers adjust the contract length to their own facility management contracts. In Vetter’s case, he started last year with a five-year contract, and had to replace his cleaning contractor a year into it. That new contractor chose to sign on for the remainder of Grubb & Ellis’s contract with the client.  

And BSCs shouldn’t forget how important a good reputation is, particularly to property managers. That four-year contract was secured thanks to the BSC’s record of working with others in Vetter’s company.

“This is my first venture with them,” he says. “It’s always nice to hear from someone else that a contract was successful.”

And now, Vetter is more likely to recommend his provider for other jobs. Crosby, who oversees one building in Phoenix, has used her BSC in other buildings she has managed in the Phoenix area as well.

“They’ve been at the building as long as I’ve been here, which is going on five years,” she says. “They are always on the cutting edge.”

Forty-one percent of respondents said they’ve been with their cleaning vendor for between two and five years, which speaks to the loyalty to be found with facility managers.

 

Cleaning priorities

When asked to rank cleaning priorities, clean and stocked restrooms topped the list for 56 percent of facility managers, followed by clean entrances and lobby areas, emptied waste receptacles, cleaning of touch points and vacuuming.

In a facility like Church Mutual’s, in which about 600 employees are women, restrooms are definitely the priority, Wagner says. The company invests in higher-end paper products, for the comfort of those employees, he adds.

Twelve percent of respondents refused to choose just one priority, though.

“It’s all one big package to me, this whole building,” Crosby says.

Many property management firms contract with multiple contractors to provide services, but as BSCs diversify and provide services additional to janitorial, it makes it easier for facility managers to partner for multiple contracts and/or services. As extra incentive to diversify: 55 percent of survey respondents said they would pay a higher price for cleaning if additional services were offered.

Carpet care was the most popular additional service, with 79 percent, followed by green cleaning (77 percent), day cleaning (59 percent), cleaning for health/infection control (56 percent) and window cleaning (50 percent).

Day cleaning — systematically moving janitors from night shift to day shift in order to help save energy costs — is an anticipated cleaning trend, though many facilities hire day porters through their building service contractors to supplement the bulk of the work being done at night by janitorial staff.

A majority of facility managers — 86 percent — expect their contractors to be educating them about cleaning trends. But for those with green and sustainable objectives in mind, having a knowledgeable BSC with experts on staff is crucial. For Crosby, that loyalty was cemented by working with a contractor on green initiatives related to the facility’s pursuit of the U.S. Green Building Council’s LEED-EB status.

Facilities and janitorial companies need to be on the same page when partnering to achieve a building certification such as LEED.

“The janitorial company that we have had a contract with for several years, have actually guided us a lot in our direction going toward LEED certification,” Crosby says. “They’ve educated themselves, they have a LEED [Accredited Professional] on staff. We don’t have a LEED AP on staff at our company so we rely on our vendors to educate us.”

Not all facility managers work for buildings in which green is a priority. In fact, survey respondents generally echoed what BSCs have been saying for years: that customers aren’t prioritizing green cleaning like they used to. Cleaning has become much more bottom-line driven.

While 77 percent of respondents want their BSC to provide green cleaning, when asked to rank priorities, green cleaning programs came in last after a healthy and sanitary environment, clean appearance and low price.

Though green has taken a back seat, sustainability has not; 86 percent of facility managers want to partner with contractors who practice sustainable initiatives.

There is hope to be found in that respondents didn’t rank low price as the most important. In fact, 55 percent of facility managers aren’t likely to pick their BSC based on price, even during a difficult economy. Of course, as the price of almost everything — fuel and supplies and labor — is rising, it becomes less and less realistic to not raise prices. This is where those good relationships with facility managers comes in handy for BSCs.

“If I presented three bids to my company and didn’t say anything to them, they’d obviously go with the lower of the three,” Crosby says. “But I think they rely on my knowledge and my experiences to explain to them that while this may be the low bid, it may not be the right company for us.”

posted on: 3/26/2012




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