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Wednesday, 21 February

FM Buying Process - Time Consuming, Complicated and Bureaucratic

FM providers  are missing opportunities to boost contract procurement according to the results of a survey released today.

The research behind the survey (conducted by Business Services Growth) says that 40% of customers are dissatisfied with current providers and that over 80% are put off by provider procurement methods.

The FM Buyer Behaviour Survey looks to examine how facilities managers currently buy FM services and what is important to them during the buying cycle. It found 40% of customers are dissatisfied with their current providers and looking for new ones but 70% are put off by approaches from new suppliers using sales tactics such as cold calling. On the whole, 40% of FMs agree that they are ‘frustrated’ by the FM buying process, finding the procurement of services ‘too time consuming’, ‘complicated’ and ‘bureaucratic’, as well as ‘very long-winded’.

When asked specifically about the sales process, a third (29%) of customers are disappointed by a lack of available information about suppliers during the sales process, along with a lack valuable information online. Furthermore, a strong proportion of respondents (45%) stated that 'lack of clear proposition' was the most irritating factor when looking for a new supplier. These findings suggest that suppliers are not are not putting the customer centre-stage in the sales process and thus are missing out on new business opportunities by not selling in a way that is preferred by customers.

Commenting on the results, Andrew Shaw, MD of BSG, said: “It is understandable that customers are frustrated with the current buying process. A reliance on more ‘traditional’ sales techniques such as direct mail, cold calling and advertising, is an 'interruptive' approach to securing new business and this research clearly identifies the need to place customers at the very heart of the sales process.”

“For those providers who are able to meet these demands, by adopting more attraction-based marketing options and/or by making more resources available to customers, there is real opportunity here for providers to significantly boost their sales pipelines.”

 

Contract ends

The research also reveals that suppliers are failing to retain contracts with existing clients. ‘Contract expiry’ and ‘delivering poor value for money’ are cited as the most common reasons for seeking a new provider, closely followed by ‘dissatisfaction with a current supplier’. This could be because account managers are not playing as supportive a role as customers need them to take. For instance, FMs say that colleagues and associates were the main source for keeping up to speed with trends and developments in the industry with 60% selecting this option, while only 43% selected the incumbent supplier as a source of advice. This statistic also reinforces the importance that customers place on word of mouth and referrals from like-minded professionals.

The above findings support those found in BSG’s 2013 research report, 'Client Management in the FM Sector', which identified that suppliers need to be more proactive in managing their client relationships in order to successfully renew their contracts. This report also found that the FM industry had the lowest levels of loyalty, than in any other industry sector.

Article written by Brian Shillibeer

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