The Trade-off

"This approach actually helps protect the contractor," Bright says.

Here's how: A contractor already sweeping the local Wal-Mart, for example, is vulnerable to low-ball bidding from another local contractor.

"If someone comes in and underbids to the local property manager, the sweeper has the choice of losing the work or matching the low bid," Bright says. "But working that account through Symbiot protects him from losing the job to another local independent contractor who might not have his overhead, his equipment, or even his insurance."

She says working through a national service provider also helps contractors extend their reach because suddenly they are part of a national organization.

"Symbiot has contacts with contractors throughout the country, so if a current customer wants a contractor to bid outside their local area, they can say 'Yes' where in the past they would have said 'No.'"

Bright says belonging to an NSP that offers a broad range of services also offers more work from other industries.

"There's a good deal of cross-industry growth where a landscaper who doesn't handle sweeping, for example, can get the work for another Symbiot partner," Bright says.

Areas of Concern

NSP representatives know there is concern among sweeping contractors about getting involved with NSPs, but they say contract sweepers shouldn't be concerned as the NSPs rely on the contractors.

Contractor Profit. Because NSPs make at least some of their profit by reducing sweeping costs for customers, contract sweepers often wonder how that affects their own profit margin. NSPs say contractors need to recognize that their customers are already trying to reduce their sweeping costs. One approach property managers are using to reduce costs is a "reverse auction bid," in which the customer sets a ceiling for the scope and amount of work to be done, whether on 50 or 500 sites, and solicits contractors to bid the jobs — often live via the Internet.

"All you can see as a bidding contractor is what the current low bid is and you have to make a determination of whether you want to stay in at that rate or lose the job," Dent says. "We see this approach as a threat to us and to the contractor and it's also not a good way to get quality work done. This affects everything all the way down the supply chain."

But the NSPs point out that they try to let the market pricing dictate their bids. Wynen says that for most sweeping jobs Genesis has been able to find a sweeping contractor to perform the service for less then the bid to the customer.

"In most sweeping jobs we have to be able to get a contractor to do it for less than that and our margins are made on the difference," Wynen says. "Overall it works pretty well."

Steinhagen says the system isn't perfect and sometimes an NSP will run into situations where specific issues cause a job to be underbid, where something requires the contractor to be more expensive.

"Sometimes in those instances we do pay the contractor more than we bill the client. It doesn't happen often because it can't, but it does happen," Steinhagen says. "We might do it for the benefit of the overall account but it can't be an issue with every location, otherwise the account doesn't work for us.

"The relationship needs to work for the contractor as well as work for us," he says. "It's got to be profitable for both of us and trust me, neither of us is getting fat and fuzzy on a single parking lot sweeping contract."

And while it might seem the key to NSPs is in the bidding process and shaving enough margin on each job to ensure a profit, NSPs want to assure sweeping contractors that is not the case.

Steinhagen adds that the bottom line is that all parties involved have to be successful for any national service provider to be successful.

"We're not successful if the contractor isn't making money," Steinhagen says. "A happy contractor for U.S. Maintenance is one that will strive to perform and not cut corners and will work to keep our customer happy."