Why Value Not Cost Should Be Leading The FM Procurement Agenda

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• Why Value Not Cost Should Be Leading The FM Procurement Agenda

14 July 2026

Adam Atkins, Co-Founder and Group Chief Executive at Coat Facilities, summarises the recent debate at the Under the Coat event which discussed procurement in the Facilities Management (FM) industry.

At its most basic level, FM providers and their clients trade money for a set of services. But in reality, what’s provided is about much more than simply cleaning, repairing or maintaining estate assets; it’s about adding value to clients’ businesses – and it’s this which must be the focus for procurement teams.

Boiling everything down to a list of services overlooks how FM directly links into long-term business strategies, and simplifies an industry which in reality is much more complex and nuanced.

Cost-driven Procurement

Whilst the proposed cost of a project or ongoing partnership has to be a key consideration – especially at a time of global financial uncertainty – this figure simply cannot and does not reflect the social, environmental and wider economic benefits that a high-quality FM service provides.

Opting for the lowest bid in a tender progress may well seem like a prudent choice, but this could see clients receiving only reactive (not predictive or even preventative) maintenance support, whilst a wealth of problems around mobilisation, compliance and quality could well come to the fore once a contract has been signed. Even when provision is cheap but adequate, a significantly lower bid is unlikely to include all of that added value which comes with the use of innovative technology, the availability of round-the-clock helpdesks, or the provision of local, quickly-available engineers, for example. We see many times very cheap PPM/servicing costs but then very expensive remedial works, we also see many companies claiming direct labour but then predominantly using subcontract labour, squeezing subcontract margins which ultimately impacts service and value.

The Government’s Facilities Management Strategy, which focuses on FM provision across the public sector, highlights that ‘effective, efficient and safe buildings are critical to enable successful operational delivery’, listing damaged productivity, sustainability, and health and safety among the risks of low-quality FM services.

It goes on to note that well-managed facilities services are a ‘vital foundation for excellent public services and productive workplaces’ – a fact that the private sector would do well to remember. Of course, these services are just as fundamental in the corporate world, so FM providers must highlight this fact, loudly and repeatedly, and procurement teams must begin taking notice.

Upholding Industry Standards

Expectations have undoubtedly risen around FM provision – with clients relying on their providers to implement the latest technology, meet stringent sustainability targets, and collate and share an ever-increasing amount of data. Yet, this is at odds with a preference for accepting bids at the lower end during tender processes. It is simply untenable to ask for higher standards whilst not regarding that this comes at an increased cost to the provider, one which they must pass on to the client at least in part so that they remain financially viable. Continuing to push for lower cost rather than high value simply discourages progression, innovation and a drive for bigger and better things – stalling an industry which, in the most part, wants to aim higher and provide more for clients.

Ideally, we would see procurement teams working with their operational colleagues to determine their exact requirements, assess tenders, and establish the value of their partnerships. It is only with this front-line insight that clients can truly understand how their FM service is impacting their business, and it’s this cross-department working which enables better choices. At the same time, providers must advocate for themselves – being willing to showcase their retention, first-time fix and carbon reduction rates; lifecycle savings; and compliance outcomes to evidence their value.

Prevention is Better Than Cure

For clients to truly shift their perceptions around cost versus value, conversations must move away from a simple description of all of the services offered. Instead, FM providers must also showcase what does not happen as a result of their intervention: complaints, safety incidents, employee disruption, equipment downtime, and asset degradation.

Because it is only by highlighting all of the challenges being avoided, as well as the benefits being achieved, that clients can begin to appreciate the true value of gold-standard FM service. And perhaps once long-term strategic value becomes the focus of conversations from the earliest point of the procurement process, it will start to become less about who is cheapest and more about who is best.

Picture: A headshot of Adam Atkins, Co-Founder and Group Chief Executive at Coat Facilities Group.

Article written by Adam Atkins | Published 14 July 2026

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