Facilities Management

It takes a lot of work to make an office building, warehouse or factory and its surrounding environment look good and function properly! IBISWorld has research focused on multiple sub-categories of facilities management services and related categories to help you understand the dynamics of this critical sector.

This graphic shows next year’s average forecast price change for the facilities management category as a whole, along with a selection of specific sub - categories of facilities management services. Click into each sub - category to see a buying guide that will get you up to speed quickly on the service.

Facilities Management
  Facilities Management Services
General Contractor Services
Janitorial Services
Security Guard Services
Solid Waste Collection & Disposal Services

KEY   <0.1% 0.1% - 1% 1.1% - 2% 2.1% - 3% >3%
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Most firms have seen the recent spike in demand for services under the Facilities Management umbrella as an opportunity to grow their operations. However, despite the surge in demand during the past three years, service providers’ ability to expand has been hindered by minimal barriers to entry and a low level of service specialization. These factors have further enhanced the level of competition in the sector, thus working against operators’ expansion efforts. Amid intense competition, operators within the Facilities Management sector have attempted to separate themselves from the pack by expanding their scope of service offerings.

Significant Competition

Barriers to Entry

  • Barriers to entry in the Facilities Management sector have been low, leading to intense competition
  • Negligible start-up costs are the main contributor to significantly low barriers
  • There is a low level of training required for facility maintenance employees, thus labor has not been a significant barrier to entry. Typical wages for industry employees average close to the national minimum
  • There are no licenses or regulations exclusive to this sector, apart from meeting all general state occupational health and safety regulations

    Key Takeaway: The ease with which service providers can enter the downstream markets has encouraged the rapid infiltration of non-employers. While non-employer firms only have the capacity to service smaller buyers, their willingness to take early losses in order to establish a client base has placed intense pressure on larger firms to compete on the basis of price.

Mergers & Acquisitions

Operators within the Facilities Management sector have attempted to stand out by expanding their scopes of service offerings (via mergers or acquisitions).

  • M&A activity has been done in an efficient manner as larger firms have absorbed smaller operators in related facilities management markets, rather than creating an entirely new market segment
  • Several firms with available assets expanded their reach to stand out from the competition. ServiceMaster, already a large facilities management operator, acquired TruGreen (a landscaping service firm) and Terminix (a pest control service firm) to achieve dominance in the sector. Brickman Group merged with ValleyCrest Landscape Cos. to form a new company, BrightView, which controls 3% of the landscaping services market

    Key Takeaway: M&A practices provide acquiring firms with an established client base and the ability to build strong relationships by offering added value (via expanded service offerings). Buyers could leverage the threat of procuring a range of facilities management services from multi-discipline firms to secure contracts that are more favorable from smaller specialty operators.


During the next three years, operators are expected to face the threat of rising minimum wage requirements in many states. No firm will be exempt from incurring higher wage costs, as this shift comes by way of government mandate. For example, the minimum wage in California is expected to increase from $10.25 per hour in 2017 to  $15.00 per hour by 2020. This trend is expected to place downward pressure on operators profit margins, forcing firms unable to shift this cost onto buyers out of the sector. Consequently, this trend means less room for buyers to negotiate service prices or pit suppliers against one another to achieve costs savings. As a result, IBISWorld expects increased demand for firms offering a wide range of facilities management services, leading to even more M&A activity.


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