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GCC FM procurement contracts take long-term view

Products are now being procured with longer-term contracts, thus changing supplier firms' operations as well, Spark Electrical's MD told ConstructionWeekOnline

Procurement cycles are changing in the GCC's FM sector. [Representational image]
Procurement cycles are changing in the GCC's FM sector. [Representational image]

The time cycles of procurement contracts in the GCC's facilities management (FM) market are changing, an industry expert told ConstructionWeekOnline.

Amit Sharma, managing director of Spark Electrical, said "continuous efforts" by FM companies are improving procurement strategies in the region. 

He continued: "Due to the continuous efforts of FM companies to reduce operating costs and increased emphasis on time management, we have noticed more and more FM companies choosing to place their procurement orders on a rate contract basis. 

"This means they come into a contract with the supplier to procure goods on yearly basis at an agreed price, thus ensuring best rates and services, and reducing the financial constraints placed by managing stocks." 

The procurement trend coincides with a growing awareness of standardisation in the industry, Sharma – part of fmME's Top Suppliers 2016 list – added. 

READ: What do ISO's new FM standards mean for the GCC market?

"As the FM industry matures, the emphasis on professionalism is increasing like never before.

"We’re finding that FM companies are now more systematic with their operator training and certification processes as well." 

Reduced requirements for minimum levels of stock are altering how product suppliers manage their businesses, Sharma explained. 

"Most small and large facility stores now choose to operate on a back-to-back stock procurement system. 

"This method ensures that the amount of capital invested in maintaining stock is reduced.

"Overall, the demand for experienced FM suppliers has increased in the market, and this is a need Spark Electrical is well-poised to fulfill."



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Construction Week - Issue 759
Feb 22, 2020