Janitorial Services in the US Industry Market Research Report Now Available from IBISWorld

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After losing revenue due to weak demand from households and businesses during the recession, the industry is set to continue improving over the next five years. The economic recovery will boost demand for cleaning services, and the rate of non-residential construction will also experience an uptick, further driving demand. Last, the aging US population will be a growth source as third-party elderly care institutions and households owned by the elderly expand. For these reasons, industry research firm IBISWorld has added a report on the Janitorial Services industry to its growing industry report collection.

IBISWorld Market Research

IBISWorld Market Research

To regain revenue, the industry will forge new partnerships and expand internationally

Over the past five years, the Janitorial Services industry has experienced moderate growth. Commercial, industrial and government entities that contract operators to clean facilities are the primary markets for the Janitorial Services industry, but demand from these clients fell during the recession. According to IBISWorld industry analyst Caitlin Moldvay, low business profit and increased pressure to restructure caused many business clients to cut expenses, consolidate or close. Furthermore, the rate of non-residential construction fell, decreasing future business demand for cleaning facilities. Consequently, demand for janitorial services suffered and the industry shrank during the height of the Great Recession, with a 6.4% dip during 2009. As a result, over the past five years, the industry has recorded only slow average annual growth of 0.9%. The industry began to recover from the recession in 2010 and has continued to grow steadily. IBISWorld expects revenue to rise another 3.1% to $47.2 billion in 2012. This is primarily due to an expansion in the number of businesses and lower office vacancy rates. Over the five years to 2017, revenue is projected to increase. In the five-year period, the economic recovery will boost demand for cleaning services from businesses and households, says Moldvay. The rate of non-residential construction will also experience an uptick, further driving demand. Lastly, the aging US population will be a growth source as third-party elderly care institutions and households owned by the elderly expand.
The Janitorial Services industry has a low level of concentration. ABM Industries Inc. is the industry’s major player. The majority of industry operators are small firms that specialize in specific regions or industries. Market share concentration has risen due to increased merger and acquisition activity, primarily on the part of ABM. For example, in December 2010 ABM acquired the Linc Group LLC for $301 million. Market share was also favorably affected by the acquisition of OneSource Services in 2007. The industry is expected to continue to have a low level of concentration in the five years to 2017. More firms are expected to enter the market as the construction sector improves, but the majority of these operators will be smaller firms that left the industry during the Great Recession. This trend is similar to other sectors dominated by small operators: these entities often enter and exit an industry depending on changes in demand. Overall, the industry tends to be small-business oriented and fragmented. However, franchised operations are a growing industry segment and may increase the average size of firms during the next five years.

As the number of firms increases over the five years to 2017, the industry will enter a period of consolidation as large clients increasingly look to purchase cleaning services as part of a bundled service offering that includes security, catering and other building-related activities. To meet these needs, many players will acquire other companies or forge partnerships with companies that offer these services. International expansion is also imminent as operators try to gain footholds in growing economies, such as China. For more information, visit IBISWorld’s Janitorial Services in the US industry report page.

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IBISWorld industry Report Key Topics

Establishments in this industry clean building interiors, the interiors of transportation equipment (e.g. aircraft, railcars and ships) and windows. Industry activities include contract cleaning services for factories, retail outlets, shopping centers and malls, business and government offices, trains and airlines and house-cleaning services.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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