A detailed RFP process drives the highly competitive janitorial industry. Consequently, evaluators often miss important criteria considerations that can tremendously impact the business outcomes they are hoping for.
Would a public or private organization better meet your unique company needs?
Below are three critical elements that can be affected by the ownership structure of a service provider. Read below and decide which one would better suit your needs.
Of course, the key difference between a public and private company is that the former must report to shareholders. What does this mean for the janitorial service users? Typically, this indicates that any budget reductions from a client may affect the service provider’s ability to maintain the relationship when a target profit margin is likely a primary decision driver. Private companies have the luxury of accommodating clients’ requirements and meeting their requests as needed without external influence.
Many public companies refrain from investing in innovative solutions that do not promise immediate ROI. On the contrary, private companies can often explore new cutting-edge technologies that promise long-term value. Many public janitorial companies must base their decisions on the financial expectations of their shareholders. They usually cannot spend time and money testing new ground-breaking technologies such as Aqueous Ozone Water or Onvation. For the facility maintenance teams, it may lead to missing out on technological advances that can help reduce maintenance costs and provide a better experience for the tenants.
Adaptability is another benefit many small to medium-sized private companies pride themselves on. This refers to the company’s ability to read and act on signals of change quickly. This may include adapting a new technology that ensures that an employee clocks in/clocks out at the right locations or promptly complies with the latest law requirements (AB 1978). Being adaptive can be difficult for large public companies with set hierarchical structures and permanent routines that fail to strive for better. For the facility maintenance teams, this often means settling for outdated processes such as paper clock-ins and paying monetary penalties for non-compliance.
Bonus: Along with the three critical points mentioned above, we want to address a common misconception that national public service providers can offer better pricing. This is not entirely true, as many large janitorial companies treat regional accounts as discrete performance units even if they are united under the umbrella of a national contract. What does this mean for facility teams? Treating each region as a separate account requires a specific level of profitability in every district. This leaves little room for subdivision performance variance. Viewing an account with multiple regions as one single effort has significant benefits. This enables the service provider to allocate resources based on the client’s needs at each facility.
Contact Stacey Wong to discuss your current facility maintenance challenges and learn about Servicon’s approach to similar issues.