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Indian Cleaning Industry:Towards Collective Action

Over 20 leaders of the Indian Cleaning Industry conceded to the fact that it was time to take concrete steps to move ahead and resolve issues plaguing the industry by arriving at a consensus. The industry, comprising of equipment/chemical suppliers and FM/housekeeping wants to do away with the existing unhealthy practices, set parameters and build workable and reliable client-vendor equations.

Client Education

One of the root causes identified by the industry during the debate was lack of awareness among clients, both in relation to cleaning equipment/ chemicals pr oviders and service providers. Often, this could even result in wrong sized machines getting sold to clients or unrealistic demands made by them.

“It’s a catch-22 situation for us,” said Anil Sethi, MD, Manmachine India Pvt. Ltd. “An equipment vendor could always sell a 20-litre scrubber-drier to a client requiring equipment for a factory of 100,000 sq. mt! Even if another vendor approaches the same client explaining the impractical option of running a 20-lt machine on 100,000sq. mt, the client would not be able to comprehend or accept. The client does not know what is best for cleaning his factory. Or for that matter, what exactly is cleaning?

“Yes, if the standards are set as to the nature of our business and once that is stipulated, then the prices will commensurate with the kind of e xpectations one has,” adds Bikram S. Chada, MD, Impressions Services Pvt. Ltd.

Agreeing to Anil, Vivek Mata, MD, Charnock Equipments Pvt. Ltd, said that often a client’s requirement could be that of a ride-on scrubber-drier and he would end up with a small walk-behind scrubber-drier. “There are two issues to this – either his budget is low and he opts for a walk-behind or the salesman does not have a ride-on and hence convinces the customer that a walk-behind is perfect for his needs.”

“Normally,” says Arun Thapar, MD, Inventa Cleantech Pvt. Ltd, “it is the service provider who procures machi nes for his clients. And in order to minimise on capital investment, the service provider would choose a smaller machine. The client, not being much aware, would ultimately land up with manpower intensive jobs being provided. The other issues leading to such practices could be the period of the contract (either the period is very short for investing in expensive equipment or budget getting cut in that period), expensive larger machines not being available on hire, no old machines being circulated on resale basis and non-availability of funds from bankers as they are not aware of this industry.”

On a tougher note Sam Cherian, MD, Scheveran Laboratories, added, “A service provider can pay what he wants to pay the workers, but who pays the service provider? The client doesn’t want to pay the vendors and doesn’t want to pay the FM companies. Where are we going actually? They make you wait in the reception for over three hours to sign a contract. You want to negotiate a price, they say L1. You want to pay minimum wages, give uniforms… how do you pay? It is not the machine supplier or the chemical supplier that needs to be addressed today but the client’s attitude.”

Sanjeev Mantri, Country Head, Arch Chemicals Products Pvt. Ltd, felt that competition should improve the quality and performance for the end user. In case of L1, the customer has to be educated about what is essential for him, educated about safe chemicals and safer handling of equipment. Then the question of L1 will not exist.

Added Prashant Sule, CEO, PCI Environmental Services Pvt. Ltd, “In this time of recession, we should not let the clients take advantage of the situation. The client goes for a change of vendor and at times the outgoing vendor is not paid a quarter of the year’s money. Like in the case of Chartered Accountants where a certificate of No Objection or No Dues is issued by the outgoing CA, a system can be brought in here too.”

Spare Parts

A direct inference to the act of selling wrong machine to clients could be drawn to expensive spare parts. “Buying equipment is probably a one time capital investment but it is the recurring cost that is bothering the service provider, because the standards diminish thereafter,” commented Bikram Chada.

“Every service provider genuinely strives to provide exemplary services but somewhere in the middle of the contract he loses his way because the pricing tends to move up and the costing goes haywire. Somewhere there has to be rationalisation of prices of spares and as service providers we should not feel that we have been taken for a ride,” he added.

Finance Facilities

Even if the service provider or the client wants to make an investment “finance companies are reluctant to give funds as we are not talking in terms of loan of 100,000 or 200,000 but to the tune of 50 lakhs or 1 crore,” Arun Thapar pointed out. Disagreeing to Arun’s point, Bikram Chada said, “there is no dearth of finance. There are funds that can be obtained from the market.”

“But the service providers,” countered M.K. Vijayasankar, MD, Roots Multiclean Ltd, “have expressed problems of obtaining finance and requested equipment manufacturers to start leasing on hire purchase facilities. But that is not our business. I have personally spoken to many banks but they are reluctant.”

While, many present at the Meet expressed difficulty in obtaining loan from financial institutions, Sam Cherian affirmed that there were banks like the State Bank of India that were ready to give funds for cleaning equipment.

“If fact, if one has the balance sheet in place, no bank would hesitate to give loan,” added Sumeet Khurana, MD, Dulevo India.

“Whether you set 8% or 40%, every individual company is going to decide on their own rules. What I feel we need at present is one voice. The standards will be set automatically. What we need first is a common Forum with a corporate structure. The leading peers from the industry sitting here must take the lead.”-Vinay Ruparel

The ensuing discussion reiterated that banks do not disburse loan on the basis of the industry being organised or unorganised or for that matter the type of procurement. Banks look at the credentials of the customer and if taxes are being paid and a strong representation is made, no bank would refuse loan. The gathering has requested CIJ to include bankers in its next meet to enable service providers to understand how to obtain a loan.

“We need to collectively spread more awareness among financial institutions,” suggested Arun Thapar.

Or as Vijayasankar recommended, “FM should be taken as a service industry and get the same privileges as small and medium scale enterprises in getting priority lending. The cleaning industry could take up this point with the Government.”

Standards and Parameters

All issues before the cleaning industry, felt Anil Sethi, were squarely related to lack of standards. “Cleaning needs to be defined and should be made known to the customer. If you look at the cleaning industry there are no standards of maintenance or cleaning, there are no parameters defined and today it is still a customer driven market. There is basically a lack of initiative on both parts of the people associated with the cleaning business – the equipment provider and the service provider – in order to take a stand. There is always a first time and I think time has come for some reputed service providing and equipment manufacturing companies to start from somewhere. Probably put hands together, go to some key customers and talk about some quality service. That is going to define the standards in this industry.

“While defining standards, we have to talk about preventive maintenance standard for the customer. It is for us to demonstrate to the customers whether a carpet should be cleaned with a broom or with a vacuum. This has to be related to certain parameters. For e.g., hotels, whether carpets or no carpets, they vacuum their rooms daily and it is a standard accepted by the industry. But we are yet to see a hospital where all rooms are vacuumed. Hospital is a place which requires vacuuming all the more. It is more about creating awareness and creating parameters for customers for standards to be obtained.”

“Further, while laying standards,” Sameer Jagmag, Director-Sales & Marketing, Nilfisk Advance India Ltd, pointed out that “one has to take into consideration the needs of various industries, because the standards required for a hospital will not be the same as that for the industry. We need to first identify industry specific requirements.”

On an optimistic note, Sumeet Khurana added that the industry was still very young and was evolving like any other industry. “I see a great change in the last 10 years. The prices of equipment & spares have come down and quality of services has become better. This is because there is competition and our customer (service provider) insists that we, the equipment providers, become better. The process is on. Even in the case of service provider, the standards have improved, though there are no set norms. I agree with Anil that we need to have a voice but we need to appreciate at the same time that we are evolving, we have all become better and competition between equipment providers and between service providers will ensure that we upgrade ourselves.”

“25 years back, the question was whether to buy the equipment or not and today the question is what to buy and whom to buy it from. But still cleaning is not considered a necessity. Some legislation should come by.”-Hemanth Ogale

Two issues that need to be looked at while setting standards, according to Archana Bhatnagar, Proprietor, Haylide Chemicals, are lack of training for chemical usage and awareness of green cleaning products. “I would link the former with the attrition rate. Each company has to perform to sustain business. It’s not that companies are not providing training but with high attrition, there is always a new worker not knowing the correct usage and mixing of chemicals.

“Besides, what are these green cleaning products? We need to document these standards of green products/chemicals get them approved and circulated among FM/service providers and corporates as Green Cleaning Guidelines. India has no standards/certification system where green cleaning products/chemicals are concerned. Besides, the Green Seal Certification system available in the US does not certify products from India, so then where do we get the certification? Hence, it is essential we draw out our document towards this.”

“We should set standards for equipment and chemicals whereby we can force the client to chose the vendors certified by a common body,” suggested Sameer Nair, Manager-Corporate Material, ISS Integrated Facility Services Pvt. Ltd.

“In fact it is not a bad idea to have our own certification system. An independent body could be created to certify the standards of the chemicals, added Sam Cherian.

Talking about standards, Vinay Deshmukh, CEO, Forbes Facility Services Pvt. Ltd, said, the industry and the customers do not speak the same language. There is no uniformity, the levels and understandings are different. There is a need to educate the customer and the cleaning industry can work towards bringing in clarity. This will stop unethical practices and reduce the burden of delivering the customer’s unrealistic demands beyond the prescribed scope. It is necessary to define this scope to the customer.

But why are we bothered only about emission of gases. Why are we not concerned about emission of liquids and what is hazardous. Why are we not concerned about the amount of hydrochloric acid that goes down the drain from over 700 hotels?-Archana Bhatnagar

“The size of this industry is so vast. If we decide to convert it from the unorganised to the organised, the size is going to be still bigger that each of our companies would grow 10-fold and yet we would not have captured even 50% of the market. If we, as a powerhouse decide to change the face of FM companies and change the way the client interacts with us, there would be a lot of change.

“Further, we should insist upon being paid for the services; avoid giving a break up of the services offered. This will come about only when the clients agree to the scope of the services offered. For this to happen, we have to interact with the top officials of the customer organisation, because at this level there will be better understanding of expectations, costs, deliverables and quality.”

Even with the chemicals, generally used for cleaning, Bikram Chada suggested that standardisation and colour coding would help. “We must accept that the people we employ come from the lower strata of the society – semi-literate or illiterate.”

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