To outsource or not to outsource?
02 May 2014
Should hotels outsource their housekeeping? Lee Moody, operations director at Emprise Services, looks at what businesses need to consider and the advantages
When it comes to the hospitality sector, first impressions really do count. Housekeeping standards and cleanliness have a huge impact on the guest experience, which in turn adds value and revenue in terms of repeat business, referrals and positive reviews.
When deciding on the strategy for your housekeeping function and particularly if outsourcing is right for you, a key consideration is a full understanding of current costs and understanding the value of the proposition.
In-house housekeeping costs
Often the current budget is calculated as the wage bill plus employers’ NIC, and sometimes, but not always, other elements such as uniforms, materials, equipment provision both electrical and non-electrical, equipment maintenance, and training. This approach will provide a basic cost analysis but often fails to capture and evaluate the genuine other costs associated with operating an in-house team.
The housekeeping function is often the largest single budget line and carries the highest proportion of wage administration, which in turn requires trained payroll personnel and systems and has a transactional cost each time a bank payment is made. Records need to be retained and, with the new RTI requirements and pension provision, a robust ‘right to work’ and auto enrolment scheme implemented, which may require external advisors and fees. Advertising and interviewing for staff also requires both management time and cash.
Housekeeping budgets are usually made up of 85% labour costs. There is also a requirement on all employers to provide a safe place of work, undertake and maintain risk assessments and methodology for all tasks and to manage the process and operation to these standards. Any failings in health and safety can have major implications both personally for the responsible manager and for the hotel brand.
What to expect from outsourcing
When looking at the value that outsourcing can bring, a misconception that often occurs is the difference between the use of agency staffing and full outsourcing to a specialist contract cleaner. Employment agencies can supply staff on a short or long-term basis but won’t provide training, equipment and materials for example, but they are a good source of labour for short-term gaps. In the medium or longer term they will not provide value for money as all responsibility for service delivery remains with the hotel management.
In a fully outsourced contract, the full responsibility for providing the housekeeping service falls to the contractor, freeing up hotel management time to concentrate on driving profitability. If it is managed effectively, the housekeeping team will function fully in line with the values, culture and ethos of the hotel and its brand.
The contract needs to be set up carefully with agreed room timings for both staying and departing cleans and effective coverage for public area cleaning and supervision. Contracts that drive these values down too far are doomed to fail as the contractor will be forced to cut corners to make a margin and standards will inevitably fall. By working with a trusted supplier, insisting on an open book pricing model and working in partnership, standards can be improved and costs controlled.
Once a contract for service is in place, it is not the case that all responsibility for housekeeping is transferred and the contract is fixed. There should be a change in emphasis to managing the contract relationship such that the contractor can work to agreed standards and outputs. Often we see a change in operational requirements such as an increase in functions, conferences or evening activities, which can bring much needed revenue for the hotel but little thought is given to amending the contracted hours to support this increased workload, resulting in the operation becoming stretched and standards affected.
The main advantage of using a specialist cleaning contractor is that they should bring up-to-date cleaning methodology to the tasks required in maintaining a clean hotel environment. They will be able to give advice regarding any difficult to clean areas and provide deep cleaning and specialist teams to support the daily cleaning activities.
For outsourcing to be effective there needs to be a partnership between the hotel and the contractor using the strength and expertise of both to deliver an excellent experience for the hotel guest.