In 2006 the cleaning market has slowed down its growth. According to International Building Care Institute, the number of companies, which do the cleaning services, has grown on 20-30 %, at the same time about 10-15% of companies left the market. The boom of 2005, when the number of companies almost doubled, didn’t repeat itself. Right now the leaders of the market are Actual Service, Den, Griffin, Clean Star, Ukrchymcleaning, Shaden Group. The list has formed 2-3 years ago, and the changes are not essential. However the leading market operators are worried because of foreign companies coming to Ukrainian market and keep their positions at the native market.

One of the reasons of constant market growing is increasing of demand on cleaning services, which are popular amongst retailers – the various clients of cleaning companies. After learning the effective visualization for client, the operators of retail trade pay more attention to the look of trade object. The western researchers state that you may increase the goods turnover on 7% by means of improving the look of the floor. Knowing that, the sophisticated retailers consider cleaning as merchandising or advertising right now.

However the cleaning isn’t considered as outsourced service in small cities. Sergej Dmitrenko, the manager of Ukrchymcleaning told:

— The most part of cleaning market is in Kiev. The development of cleaning in small cities mostly depends on the commercial estate market: the cleaning companies appear only when the serious construction is planned.

The representatives of Griffin Group work also in the regions. They say that three years ago the main worry of the company was creating of cleaning demand in regions. These markets are very prospective ones, even though they are left a tad behind at the moment.

Vitalij Opanasiuk, the manager partner of Griffin Group tells:

— Even today the regions are considerably behind the capital. The tenth part of departments of Griffin Group in the regions does the same volume of works as one Kiev department. Even though the provincial departments are developing very rapidly, that’s why three years ago the main investments were public relations and searching of reliable suppliers. That’s why we created a chain of offices in Donetsk, Dnepropetrovsk, Lugansk, Odessa, Kherson, Sevastopol, Simferopol, Lvov and Kharkov. In the nearest future the chain will double.

The operators notice, that the retailers’ requirements don’t differ from the requirements of the other companies: the best quality for the smallest money. To get a big order and a guaranteed monthly inflow of turnover money, lots of companies are ready to reduce the price of services, which leads to reducing their profitability from 6-10% to 1-2%. They aren’t even stopped by the specificity of work in the trade objects. According to Mr. Opanasiuk, the cleaning of the retail objects means the longer working day, the higher level of salaries and amortization of technique, increased demands to the staff conditions. That’s why the cleaning companies divide the retailers on the number of customers, trade direction and image positioning.

The serious competitors of cleaning companies are still the separate cleaners and non-registered teams. It’s not even possible to estimate their part of market. Mr. Dmitrenko thinks that they operate about 95% of market. The others name another number – 5-7%. This difference in estimation is caused because there’s also a half-legal market of cleaning services. Mr. Opanasiuk thinks that there’s no sense to consider the illegal companies as market operators.

He says:

— They are paid from the illegal funds, which is a characteristic of “grey” economics, which has its place in any country of the world. The sector of “white” economics covers just 70% of cleaning demands. This is a fact. I suppose that the companies will get their 50% soon.

The estimations of volumes and structure of market differ because it’s not easy to check the appearance of new companies. Each year more than 100 cleaning organization appear in Kiev.
One by one the “pocket” companies appeared at the cleaning market. For example, the cleaning department was created in the shopping mall “Karavan”. The independent cleaners admit the effectiveness of these enterprises. At first these companies served just their own objects. As soon as they became stronger, they started to take orders from different companies. The problem of these companies, according to the specialists’ opinion, is in the low mobility and absence of aggressiveness.

Mr. Opanasiuk says:

— Any company, which can’t go through the millstones of market competition (if it’s not a governmental monopoly), is doomed to staying within its holding. Its technologies are getting older each year, it’s not able to buy a new equipment and tools, technologies and chemicals. It doesn’t have the direct deliveries from the western partners. The expenses on amortization of equipment and chemicals are so high that any cleaning company may replace it by intensification and optimization of expenses.

Whatever happens, the majority of native experts think that potential of cleaning market development in retail sphere is pretty high. The foreign operators are already considering about working at this market segment.

Source: “Novaya Torgovlya”