The Cost of Facility Management: Hiring In-House vs. Outsourcing

Posted on March 7th, 2019 by Mariel Nowack

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A strategic decision is made when corporations are deciding between hiring an in house facility manager or outsourcing to a facility services expert. After conducting a thorough facility program assessment and developing a strategic plan, the decision often becomes a financial one.

The management of the program is typically done one of two ways:

  1. Hire In-House – A single person responsible for the management and oversight of the facility management program.
  2. Outsource – A outside company with a core competency in facility management.

It’s common is for companies to outsource the facility management responsibilities because it is centralized, data-driven, and cost effective. Have you evaluated the administrative cost savings potential of outsourcing the facility management responsibilities?

Let’s look at the numbers:

Average Salary for a Facility Manager according to Salary.com as of February 14, 2019.

National Average Facility Manager Salary: $94,971

Connecticut Facility Manager Salary: $103,667

New York Facility Manager Salary: $99,030

Massachusetts Facility Manager Salary: $102,019

New Jersey Facility Manager Salary: $107,031

If you include 25% fringe benefits across these average salaries, you’re looking at a minimum annual cost of $118,713.75, a maximum annual cost of $133,788.75, and an average annual cost of $126,679.50.

Alternatively, you could hire an outsourced facility management company such as ONE SOURCE for less than what it would cost to hire in house. You’ll have access to greater resources, professional expertise and the flexibility to meet your unique needs.

For example, a portfolio of 32 commercial properties that average 5,500 sq. ft. each requires the oversight of a full time facility manager at an average annual salary of $94,971. In an outsourced strategy, ONE SOURCE could manage this portfolio for 15 – 34% less in administrative costs and offer a suite of services and the facility expertise that would exceed that of a full time facility manager.

Read our case study on the 38% administrative cost savings we achieved at our client Cornell Scott Hill Health Center – a community health care center with 25 + locations across New Haven county.

New to the outsourced facility management concept? Watch our video below to understand how we work with companies just like yours to build a custom facility management program to meet all your facility goals and expectations.

Is your portfolio in need of a strategic facility management program? Call us today for a FREE Facilities Program Assessment. 203-741-8770

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This entry was posted on Thursday, March 7th, 2019 and is filed under Facility Management Pro Tip, FM Resources, News, Standard Operating Procedures. You can follow any responses to this entry through the RSS 2.0 feed.

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