Jani-King (GB) Reports a System Wide Turnover Growth of 49% in 2008
As a whole, the commercial cleaning sector is weathering the recession well. However, it has become apparent that changes in the industry are also helping to strengthen the position of national networks, such as franchise organisations like Jani-King.
As national companies look to focus on their core skill or service in the current market, they are increasingly starting to outsource areas that are non-core. As a result of this, commercial cleaning is seeing increasing growth in business from the top end ‘blue chip’ national segment of the market. The commercial benefit to these clients is a reduced direct headcount and potential cost savings, by using an external supplier who can provide a service more efficient and more cost effectively. Jani-King specialises in this and their approach is recognised by national Procurement/Buying departments of companies employing central purchasing. The overall impact of this trend, coupled with legislation drivers, has been an acceleration of growth in the contract cleaning market, which is predicted to be worth £6 Billion by 2010.
In summary, you have a rapidly growing and consolidating industry that is underpinned by the key drivers of outsourcing to focus on core competencies coupled with legislation drivers.
This has been great news for Jani-King, whose system wide turnover in the UK grew by 49 per cent in 2008. Its success is simply driven by contract wins amongst ‘blue chip’ companies in a competitive tendering environment, with an extension of contracts with more sites where Jani-King is already a preferred supplier. Examples of this are: Odeon Cinemas, where Jani-King now services 85 locations of the total of 112; and H&M Hennes, where Jani-King successfully restructured the service level agreement with the customer to offer it cost savings at no margin erosion to Jani-King and its franchise owners. This type of win/win negotiation requiring flexibility from both the supplier and customer is key to the future of the industry and the continued success of Jani-King franchise owners.