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Encouraging news - but not for everyone

Published 11th May, 2010 by Neil Nixon

Encouraging news - but not for everyone

In encouraging news for the UK cleaning services industry, 388 of the top 1000 companies in the market are growing at more than 10% per annum and making healthy profits. However, according to industry analyst Plimsoll, while many of these companies are breaking new ground and leading a sustainable recovery in the market, there are 84 other companies whose headline grabbing sales growth masks something much more sinister.

David Pattison, senior analyst and author of the new Plimsoll Analysis, explained: “Firstly, it makes a nice change to have some positive news to report. 388 growing, increasingly profitable companies have either tapped into a new, fast growing revenue stream or are just the best performers in the old ones. Anyone struggling to make the most of the recovery should look at these companies and ask themselves ‘what do these guys sell, make or do differently to me?’”

However, Pattison warns that there are 84 companies achieving this eye catching sales growth but their profitability tells a very different story: “Essentially there are two types of growth in the market – good v bad. 84 companies have achieved over the 10% sales growth but in doing so have seen their profit margin collapse. They are simply overtrading. The accolades of growth are all well and good but the bills need paying too. More worrying, seven of these companies have been loss making for two years – even with double digit sales growth I doubt they will make it to a third.”

On the subject of companies getting it wrong at both ends of the scale, Pattison offers this warning: “While the market continues to recover and the 388 top performers show the way, there are 121 companies facing a very bleak future indeed. Losing sales, profits and probably most of their remaining options, these companies have been rated as ‘danger’ in our report. Time is running out and only a takeover or a rapid turnaround is likely to redeem their situation.”

The new Plimsoll Industry Analysis – Cleaning Services will tell you instantly which companies are prospering in the post recession market place, those taking a big gamble and those heading for trouble. It gives an instant performance rating on the top 1000 companies in the market and an overview of which companies are ripe for acquisition and who is set to be buying. Each company is assessed using the Plimsoll Model - a graphical and written analysis that lays bare the facts and gives you instant opinion.

Readers of Cleaning and Maintenance are entitled to a £50 discount on this new special edition of the Plimsoll Industry Analysis – Cleaning Services. Call 01642 626400 for further details and quote reference PR/ SV20.

www.plimsoll.co.uk

Article links

http://www.plimsoll.co.uk