Consolidating Facilities Management Spend Across a Multi-Entity Group

THE CHALLENGE: A group of five companies operating under a shared corporate umbrella had historically managed facilities services independently. Each entity had its own contracts for cleaning, security, HVAC maintenance, and landscaping, often with different suppliers, different terms, and different service levels. Total annual spend across the group exceeded USD 18 million, but no single entity had visibility into the aggregate picture.

The group’s procurement function was tasked with identifying consolidation opportunities while respecting each entity’s operational autonomy and local service requirements.

THE APPROACH: The team began with a comprehensive spend analysis, mapping all facilities-related expenditure across the five entities to a common taxonomy. This exercise alone revealed that the group was using 47 different suppliers for services that could be categorized into just six core service lines.

Rather than pursuing a single mega-contract, the team designed a tiered sourcing strategy. For high-spend, standardizable services like security and cleaning, they ran a group-wide RFP that leveraged aggregate volume while allowing entity-level service specifications. For specialized services like laboratory HVAC maintenance, they maintained entity-level contracts but negotiated improved terms using group-wide benchmarking data.

A critical success factor was stakeholder engagement. The procurement team established a facilities management council with representatives from each entity, meeting monthly during the sourcing phase to align on requirements, evaluate proposals, and resolve concerns about service continuity.

THE OUTCOME: The consolidated sourcing approach delivered a 22% reduction in total facilities management spend, equivalent to approximately USD 4 million in annual savings. Beyond cost, the group achieved standardized service level agreements across entities, a single governance framework for supplier performance management, and improved compliance with health and safety standards.

KEY LESSONS: Consolidation does not require uniformity. The most effective group procurement strategies create leverage through aggregation while preserving the flexibility that operating entities need. Invest heavily in stakeholder engagement before launching the sourcing process. Resistance to consolidation is almost always rooted in legitimate concerns about service quality and local responsiveness, and those concerns deserve thoughtful solutions.