The Trade-off

Why property managers use NSP

NSPs say national commercial and property management companies seek their help for a variety of reasons ranging from saving money, to developing a better and more consistent image at each site, to improved resource management.

"Our sales staff is out there looking for companies with multiple locations in multiple states who are struggling with the pain of trying to manage independent properties and hundreds of contractors," Dent says. "Those are the companies where we can offer value."

NSPs can save customers money by reducing fees for each sweep, by streamlining the customer's operation, and by centralizing decision-making.

"Through centralizing and consolidating services there is a massive reduction in the soft costs such as invoicing and payables," Dent says.

Steinhagen says a national approach to sweeping helps control costs, and that standardized rates across the country allow for better corporate budgeting.

"The truth is that if a national company is handling its sweeping locally it's usually going great in some places and going terrible in other places," Steinhagen says. "If it's going great all over the country the property managers are probably paying too much."

NSPs also promise their customers they will monitor each location regularly to make sure the work is getting done and to make sure the facility meets whatever appearance guidelines the client wants.

"We feel we're the eyes and ears of our customers who don't have the resources to manage the exterior of every property," Dent says. "Our people are on the site at least once a month. We take digital pictures, and we're able through those pictures to assure management in Philadelphia that properties in California are looking like they are supposed to."

How does an NSP work?

Each NSP operates on its own business model, with goals of providing service and savings for the customer, work and growth opportunities for the contractor, and profit for the NSP.

Some NSPs have developed their own formula that enables them to bid work based almost entirely on measurements and other numbers, without visiting the job site. Other NSPs rely on their sweeping contractors to bid the job for them. Some NSPs do both. The NSPs make their bottom line through management fees for each account and by charging its customers more than it's paying its sweeping contractors on each job. In some cases that does mean contractors end up sweeping for less than they had the account for on their own.

U.S. Maintenance, for example, relies on a formula that includes parking lot size, the services provided, what the market will require to get the job done, plus overhead, intangibles, and profit. Clients provide the sales people with a site plan and measurements, which allows the staff to establish its national pricing. In markets or in situations new to U.S. Maintenance, the NSP asks approved contractors to assess and bid on a percentage of the sites to make sure its assumptions are correct.

"If we have a significant amount of experience in a market we might only ask a few contractors to bid a few jobs," Steinhagen says. "If we have little experience we will likely ask them to bid more. Truthfully, at this point we have a pretty good idea of what's required in most situations, so we have the experience that supports the bidding assumptions we make."

Dentco has its Quality Assurance Managers conduct an "exterior assets inspection" of each property, then builds the bid based on the inspection and its formula, only going to the contractor after it has secured the business. Genesis generally does its own estimating and bidding for each job.

"We'll bid it at what we think the market will demand and then increase it to make our margins," says Bryan Wynen, president of Genesis. "That enables the sweeping contractor in the market to do the job for what the market will bear."

Symbiot, on the other hand, relies on its contractor partners to visit each property, assess and measure the job, then present a bid for the work to Symbiot.