Why managed maintenance is becoming the new norm in retail

SMS Assist Blog Post
SMS Assist

Many national retailers started small and grew their store’s footprint over time. However, as portfolios grow and locations age, the need for maintenance becomes exponential. Over time, this growth and aging exceeds a retailer’s ability to keep up, so they add a head count and consolidate vendors. In this situation, we see that the growth pace outruns the ability to hire, which creates new problems.

As these problems arise, facilities’ teams transform into reactive fire stomping crews while sacrificing strategy, data analysis and service quality. Thus, maintenance expenses go up, oversight deteriorates and store appearance along with functionality suffers.

Fortunately, facility management solutions and technology has emerged to offer a comprehensive and integrated process that protects retail clients from uncontrolled maintenance spending while maximizing the clients’ internal resources. In the last few years, we have seen the trend of retailers adopting these technology solutions.

Here are some reasons for this trend:

1. Economies of Scale

Third-party facility management companies leverage a network of service technicians or providers across not only one client, but also all nationwide clients. This creates opportunities to buy down labor or material costs, as well as travel and other charges.

2. Visibility

Facility management companies have invested heavily in work order platform technology that provides great insight into a client’s facility maintenance operation, which allows the client to have the right-size maintenance and allocate capital budgets in a more informed manner.

3. Accountability

Facility management providers typically focus on providing value to their clients, through service enhancement, savings potential, or resources to better manage a client’s store footprint. By doing so, the provider takes on more risk and is held accountable for a cost-effective and high-quality outcome.

4. Standardized Consistent Service Quality

By managing the client’s entire real estate portfolio with a consistent approach, all the locations will encounter a similar service experience from the provider, which facilitates benchmarking, program management, and capital investment plans.

5. Cost Savings

Besides the value derived from economies of scale, data can be used to better forecast future spend, identify anomalies and predict failure for preventive maintenance and many other benefits. Even on the invoicing and payment side, valuable back-office costs and resources can be reduced with a third-party administrator while the provider’s technology yields timesaving benefits to field personnel.

Retailers benefit from relationships with solution providers that align with the objectives of reducing the overall work order cost, not merely the lowest labor rate. Besides cost reduction, FM technology will provide retailers with complete visibility and control into their maintenance program overall. This type of visibility is something that in-house technicians, facility managers, and even some work order platforms, alone, cannot effectively address.

Industry trends indicate the days of input-based maintenance are ending. Facility maintenance has evolved significantly over the past ten years. More and more retailers are moving to outcome-based delivery that align their objectives with the broader financial and operational goals of their organization.

To learn more about meeting your budget and operational goals, read my blog, 5 Ways a Reactive HVAC Replacement Plan is Hurting Your Budget.