How FM can help to solve trading issues

A long time ago, I remember sitting in an induction meeting with a regional manager who was a contractor for major high street names. He was quite proud, telling me they made their money on the work they didn’t do as opposed to the work they did. Essentially, it seemed that suppliers were either trying to deliver a semi-reasonable service to fit the contract or case revenue, or they weren’t doing work to ensure they met a margin.

I couldn’t believe what I was hearing. This type of behaviour was so rife in the industry. Sadly, getting the best rates is still the default position when it comes to FM. In this sense, little progress has been made.

Yet, with the current challenges facing the world of business, I believe we’re at a tipping point. Businesses’ approach to FM needs to shift. Rather than focussing on getting the cheapest deal, greater emphasis needs to be placed on the value that FM can bring to operations and trade – particularly whilst we navigate this uncertain period.

There’s no denying that businesses (and the people within them), are currently facing immense pressure. The combination of a struggling high street, fears over the impact of Brexit on Britain’s future trade deals and the threat of Coronavirus is creating uncertainty. As a result, it’s never been more important for businesses to strengthen their operations, support their people and protect their financial stability.

Managing budgets and controlling costs in challenging markets, whilst ensuring operational sites are safe and meet legal compliance standards, are real issues for businesses up and down the country. Ultimately, these can be a barrier to trading effectively.

Not having effective FM in place can also lead to serious trading issues, yet it is this area which many businesses are reluctant to focus on or invest in.

I totally sympathise with the pressures clients and FM professionals face. Everyone is under pressure, whether it is from poor trading conditions, demands to control budgets or shareholder returns. The pressure to deliver a service at a cheaper price than the last time they tendered that service is real. This can also have a knock-on effect on the wellbeing and mental health of those within the business. Nevertheless, it is a false economy to opt for the cheapest or least disruptive option.

Poorly maintained estates that are underinvested or have no preventative maintenance will ultimately be impacted through loss of revenue. This could be due to critical equipment failure or because the environment may be unattractive or unbearable to colleagues or clients. The result? Clients go elsewhere. Or, in a worst case scenario, the site may close whilst repairs or maintenance services take place.

The amount of assets or equipment to be maintained will understandably differ between companies in the same sector. I’m not saying you can compare different sectors like for like, but ultimately the impact of not having the right FM solution in place is the same - potential loss of trade, damage to brand reputation and the loss of long-term customer loyalty. It will also cost more in the long run - there is certainly truth to the old adage, speculate to accumulate!

There isn’t a one size fits all approach or solution. However, for those open to new ideas, there are options.

At Cloudfm we want to succeed but we know that to do so, we must encourage a shift when it comes to FM management. Those who are not open minded and simply live according to the mantra “It's not broke, why fix it?" or "We have always done it that way." will be left behind. For them, it will be extremely difficult to catch up.

Our approach is therefore different and unashamedly so. We try to understand the most pertinent issues facing a client’s operations teams. We’re then able to deliver a personal but preventative approach.

The benefits of regularly scheduled preventative maintenance can be seen in less disruption to trade, fewer breakdowns and extended equipment life. Regular inspections will identify early warning signs.

We also take an active partnership approach with our clients, ensuring any problems are resolved immediately - we have designated Account Managers, Key Account Supervisors and a 24/7 helpdesk.

Not only that, we have a team that responds to major incidents such as fires or floods which helps to get sites back trading as quickly as possible.

One of the biggest issues we see is that of statutory compliance. Without auditing, compliance levels can be reported unrealistically leading to unsafe levels of actual compliance, sometimes below 50%. Cloudfm’s 100% estate-wide compliance auditing allows our clients to know their exact compliance levels at all times.

Effective FM will also save money in the long term. Preventative maintenance rather than reactive maintenance has an extremely positive impact on capital budgets, facilitating a better understanding of lifecycles of equipment and assets when you are working with the right FM partner.

At Cloudfm we capture huge amounts of data from our asset tagging. We can see all of the work carried out on individual assets to determine which equipment performs better.

Don’t just take my word for it. We see the benefits of effective FM time and time again with our clients.

One example is fast food giant KFC. In 2014, the world-famous brand was at the start of an ambitious five-year UK growth strategy. However, for KFC its priorities for FM delivery extended beyond simply cost and efficiency.

With over 230 restaurants across the country, it was integral that KFC’s strategy delivered consistent results and incorporated high quality, innovative solutions. Not only this, the brand places the managers of every single one of its restaurants at the heart of its business strategy. Ultimately, this means that all decisions flow directly from the needs of the customer – something which is pretty unusual in the world of fast food.

As a result, KFC needed to find a partner which could deliver across all the strategy’s objectives. With a focus on loyalty, KFC takes pride in building long-term, trusted relationships with its suppliers. It was vital that these were protected. It was therefore a bold step for the brand to review the market, exploring any competitive alternatives, because any change in FM supplier could have a knock on effect on the supply chain.

KFC embarked on a rigorous procurement process. It was important that their FM partner understood their business inside out and would become a valued resource for restaurant managers moving forward. KFC was thinking of the future and sought an innovative FM partner who could join them on their journey.

Our approach to managing data and our ability to provide unique insights was a key factor in KFC appointing Cloudfm as their FM partner.

As soon as the contract was awarded, we took steps to fully engage with KFC’s perfectly aligned culture whilst delivering the level of visibility that KFC required. This included Cloudfm hosting a Supplier Engagement Conference early in the mobilisation stage. The event gave us the opportunity to ensure valued suppliers were involved in the transition process – ultimately meaning all key suppliers were successfully transitioned to Cloudfm before the contract had even launched.

The results were impressive and speak for themselves. An ￡800,000 annual saving was achieved through delivering actual maintenance spend to budget each year, and a ￡220,000 annual saving on reactive spend. Plus, an 88% first time fix rate was achieved across all tasks whilst there was a 42% reduction in the total hours closed per period.

What we are promoting is not rocket science – it’s just a basic common sense approach which has a proven ability to work.