How Oman Facility Management Market is
positioned?
Facility
Management (FM) market in Oman
has witnessed robust growth during the review period; however, the market is
still in its growth stage. The market is highly fragmented with large number of
players operating within the FM industry. The contracts are majorly awarded to
the inside based contractors.
The
FM market in the past was highly dominated by soft services but technological
advancement has led to the increasing demand for hard services during the
review period. The share of hard services has been increasing over the years in
the country on the basis of revenue.
Outsourced
Personnel services has been the major contributor to revenues of the industry
as majority of FM companies in the country outsource these services.
The
major growth drivers for the industry include the booming real estate market,
growing construction industry, increasing number of shopping malls and
supermarkets and expanding hospitality sector. The focus on Green Buildings
aligned to Vision 2030 has also created opportunities for FM services in the
country through the development of large scale projects.
The
primary challenge faced by the industry is the lack of awareness of FM
services, resulting in low penetration. In addition, under-developed
outsourcing, regulatory issues, low level of investment, low availability of
skilled labor and dependency on foreign expats are some of the other major
challenges for the facility management market.
Oman Facility Management Market
Segmentation
By Soft and Hard Services
Soft
services dominated the market of facility management in Oman with ~ revenue
share in 2017. The revenue share of soft services accounted for ~ of industry
revenue during 2011. The decline in revenue share during 2011-2017 can be
advocated to the fact that various firms hire manpower for soft services such
as housekeeping and manned security instead of giving contract to the FM
companies for the same. Hard services accounted for ~ of facility management
market revenue in Oman during 2017, inclining from ~ in 2011 owing to rising
awareness about the benefits of FM and increase in the number of buildings
requiring hard services.
By Single, Bundled and Integrated
services
Single
services have contributed highest share of ~ to the revenues of the industry
during 2017 with a CAGR of ~ during the period 2011-2017. These services hold
the highest share in revenue generation of FM market as clients prefer in
giving contracts for a particular service to the FM Company owing to parameters
such as quality, price and other factors.
By Outsourcing and In House
Outsourcing
services segment has dominated the overall market, accounting for ~% of overall
FM industry revenue during 2017. The companies outsource the services in cases
when service is not available with the company or a company does not want to
involve the manpower in a small project. The reasons for FM companies
outsourcing these services and entering into contracts with other companies
include cost-efficiency, high competition and high quality. In-House services
have added a share of ~% in the industry in 2017 and increased at a six year
CAGR of ~%. Many companies in the facility management market have their
in-house teams for FM services, especially soft services. The profit margins in
case of in-house are high as compared to outsourcing of services.
By Sectors
Industry
and other sectors which majorly include public Infrastructure such as Airport,
labor camps, oil & gas plants, energy plants, logistic parks, industrial
plants and education institutes, schools, universities collectively contributed
~% to the overall facility management market revenues in the Oman in 2017. Most
of the development in this sector is being witnessed in three regions Salalah,
Sohar and Duqm. Therefore the demand for facility management service is from
these regions. The retail sector has grown which has provided FM companies with
the opportunity to provide services demanded by these complexes. The increase
in the number of tourists in the country has led the hospitality sector to grow
over the years and this can be advocated to the fact that the number of tourist
visas issued has increased by ~% from 2015-2017. Residential sector has added a
share of ~% in the FM market in terms of revenue generation in 2017. The
residential sector prefers not to give facility management contract to the
companies as it incurs additional cost.
Trends and Developments in Oman
Facility Management Market
The
commercial sector in Oman has been growing in recent years and is expected to
augment further given the 9th Five Year Development plan and Vision 2020 of the
country. The hospitality industry in Oman has been growing during the review
with the rise in hotels and hospitals in the country due to increasing inflow
of expats. The supreme council for planning has formed a committee in Oman to
develop comprehensive a green design code for the country in adherence to GCC
building code. The construction of such buildings has increased the demand for
facility management in the country. The facility management market in Oman is
fragmented with rising competition from new companies entering the market.
The
market dynamics has changed in terms of number of players as domestic and
international players have been entering the FM industry. With major MNCs
entering this market, competition has further streamlined in recent years.
Oman
FM industry is fragmented with around ~ companies operating in the market. The
facility management market in Oman has high potential due to lack of awareness,
low availability of specialized and integrated service providers and low
penetration rate, which provides an opportunity to FM players to enter this
market.
Oman Facility Management Market Future
Outlook and Projections
The
facility management market in Oman is fragmented and positions at growth stage.
This provides immense opportunity to global and local players to tap the market
with technology advancements in the FM industry. This will further lead to
various acquisitions and mergers in this industry making a positive impact on
the market in terms of revenue generation. The cost of doing business in Oman
is anticipated to increase in 2017 and the FM industry will be impacted by ~%
increment for Omani employees, change in visa fees for expats and the increase
in corporate tax from ~% to ~%. Growing
hospitality and healthcare industries in the country is expected to trigger the
demand for HVAC services, electromechanical services, operational and
maintenance services and other services. More IT-based FM companies are
expected to grow in future and the focus on green building initiative will
further increase the scope for the FM industry. Additionally, the rise in
various industries due to initiatives taken under the 9th Year Development
plan, 2016-2020 will trigger the demand of FM services which will lead the
market to rise. Oman facility management market will be largely dominated by
soft services during the forecast period. The soft services market is expected
to grow at a CAGR of ~% during 2017-2022 owing to the increasing number of
hotels, hospitals and other buildings in the country which will lead to high
demand for housekeeping, landscape access and security. Hard services market is
also expected to witness a robust growth in absolute terms by achieving a CAGR
of ~ % due to increase in demand for HVAC services, electromechanical services,
operational and maintenance, fire safety and security system.
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