FM Boom in Southeast Asia-Focus on the Vietnamese Market, Forecast to 2023

September 2019 •
51 pages •
Report ID: 5823005 •
Format: PDF

Summary
Table of contents

The Vietnamese facilities management (FM) market is expected to record a growth rate of 5.5% in 2019. By 2023, the total market is expected to record a compound annual growth rate (CAGR) of 6.0%, reaching $470.8 million. Rapid growth in Vietnam’s economy is driving building construction in various sectors, such as healthcare, financial, industrial, and residential, thereby boosting the demand for FM services. Moreover, there is growing awareness on the benefits of outsourcing building services for reducing operational cost. Major restraints to growth in the FM market in Vietnam include preference for managing certain building services in-house, cost sensitivity, and lack of knowledge on outsourcing benefits. These factors often defer engagement with third-party providers of FM services.

The market is highly fragmented, with the share of individual participants being not more than 5%. There are no apparent market leaders, as each service provider serves its own clientele. The distinctive requirements and standards sought by end users from different sectors have resulted in a growing preference for sector-focused service providers. End users prefer local service providers that are familiar with the domestic workforce and the local language and culture.

In the Vietnamese FM market, there needs to be a strong focus on key services—cleaning, repair and maintenance, and security. There is also a need for higher R&D investments for enabling greater automation in security services and cost reduction to offer competitive prices. FM companies need to keep up with anticipated trends such as provision of green cleaning and energy management services using environment-friendly chemicals, substantial R&D investment, and partnerships with energy efficiency experts. For example, green cleaning is already an upcoming trend in other countries. In Vietnam, it is still considered as a new trend and adopted in niche segments such as green buildings and private hospitals.

Going forward, the market will move toward domestic hybrid building service providers offering all kinds of services to customers. This can be done by building specialized teams, hiring skilled resources in specific areas of focus, or executing M&As with other FM companies.

The scope of the FM market for this study covers cleaning, security, and repair and maintenance. The end-use sectors covered in this study are commercial, education, healthcare, public sector, and industrial.

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