Service Contracts

Service Contract Benefits

Outsourcing maintenance to a third party is a difficult decision for most companies. Many facility managers feel they will lose some level of control if employing a contracted maintenance service. However, a well-structured contract, requiring specific results, can be highly cost-effective. In addition, employing maintenance contract services provides company management with more flexibility than employing their own company maintenance staff.

Managed Cost

Contracted maintenance services are more flexible where costs are concerned. Downsizing company maintenance staff during slow business is costly. However, maintenance contract services can be released, or their staff reduced, with just a specified amount of prior notification. Moreover, depending on contract language, maintenance contracts may prescribe a fixed rate per day, regardless of labour hours worked. This type of contract, while lucrative for the contractor, improves the contracting company's ability to forecast budget costs.

Improved Reliability

A maintenance contract written to include incentives for equipment uptime and performance motivates the contract service's management and technicians to meet established goals. A greater increase in equipment reliability is possible with such a maintenance contract than possible with company staff maintenance alone.

Skilled Labor

Skilled technical labour is never easy to find. The screening and training process alone costs a business much more than employing a qualified contract technician. A maintenance contract benefits the contracting company through the ability to obtain a skilled workforce through a maintenance service. Additionally, the contractor is responsible for pensions, insurance, taxes and unemployment costs, rather than the employing company.