Asia Pacific cleaning sector thrives

8th of November 2019
Asia Pacific cleaning sector thrives
Asia Pacific cleaning sector thrives

According to a study that focuses on the global professional cleaning market, most regions in the world are still growing. The largest growth figures can be found in the Asia Pacific region, where several factors contribute to a thriving professional cleaning industry. Bobbie van der List reports for ECJ.

As we pointed out in earlier features about the Asian cleaning industry, things look good for the near future: the professional cleaning industry is growing in terms of output, but is also maturing when it comes to the status of the profession. This is clearly reflected by estimations made by an Allied Market Research report called Cleaning Services Market-Global Opportunity Analysis and Industry Forecasts. The cleaning market, the report reads, will reach roughly $74 million by the year 2022.

According to this study, Asia Pacific is the second largest market in terms cleaning services and market size, which can be partially attributed to increased disposable income and urbanisation, but also to a steep increase of construction activities in a country like China. When we think of the very ambitious one belt one road infrastructure project of China, it is likely that construction will explode across the region, which could have positive trickle-down effect on the professional cleaning industry.

The biggest market in the region is China, yet countries like Australia, Singapore and India are also expected to show even higher growth rates until the year 2022. Changes in family structures across the Asia Pacific region have a strong impact on the industry, especially with women entering the workforce, which disrupts traditional family structures wherein the wife is expected to care of the house.

In the Cleaning Services Market-Global Opportunity Analysis and Industry Forecasts it is stated that there is a “consistent demand for various commercial cleaning services (…) among commercial consumers such as retails sectors, public institutions, hospitals, and events and stadiums”.

Furthermore there are sectors such as construction and mining, which cause a huge amount of debris – this means that in these sectors professional cleaning companies are very active.

The report goes on by stating that “according to the estimations by Chinese central government, 60 per cent of the Chinese population is to reside in cities by 2020, driving the demand for construction activities”. The latter is also a positive development for the professional cleaning sector as it further drives demand for professional cleaners.

Sticking with China, the report also expects that a disposable income increase is expected to fuel demand for the domestic cleaning market. According to a National Bureau of Statistics of China source the disposable income reached $3,349 in 2015, an increase of $200 compared to the year before. What does this say? Well, people simply have more money at their disposal, and are more than happy to spend it on cleaning. We can see similar disposable income increases in a country like India.

More exhibitions

All in all, there is much excitement in the professional cleaning industry in Asia, which is also reflected by the increase of cleaning exhibitions held across the continent. But to get a better understanding of some of the trends summed up in the previous paragraphs ECJ correspondent Bobbie van der List spoke to Abhinav Rautela, strategic client partner at Allied Market Research, responsible for publishing the forecasts.

Asia Pacific is expected to achieve the fastest growth rate from 2016 to 2022. To what factors can we contribute this relative growth vis-à-vis other regions in the world?

“Growing disposable income, growing working women population, rising demand from commercial consumers are some of the major factors which are contributing to the fastest growth of cleaning services market in Asia Pacific.”

How important is the factor of women increasingly being involved in the labour market?

“In Asia Pacific region, millions of women who were dependent on men have taken control of their own economic outcomes. The expansion of higher education enhanced job prospects for women. It has improved their value in the job market and shifted their role models from housewife to successful professional women. For instance, women now account for 43 per cent of the labour force, up from 36 per cent 30 years ago in Japan.”

The number of Japanese women working is steadily increasing, which could be a great contributor to the growth of the cleaning industry. How important is this factor in Japan?

“The growing number of working women plays an important role in the growth of the cleaning services industry in Japan. There, the number of female workers has grown from 15.48 million in 1985 to 24.36 million in 2014. With this growth, new avenues have opened for the cleaning industry in the country. Furthermore, growing demand from commercial customers play significant role in the growth of cleaning services in Japan.”

What sort of companies will profit especially from this development? “Companies involved in providing cleaning services to households and commercial facilities will certainly benefit from the growing number of working women in the labour market.”

Adoption of AI

How important is the fact that China, and perhaps to a lesser extent Japan, is leading in terms of developing AI? Does that play any role in the growth of the cleaning industry?

“China has the highest adoption rate of AI and automated equipment in various household and industrial applications. This is likely to offer significant opportunities for cleaning equipment manufacturers to adopt the automated/AI powered/robotic cleaning technology in the cleaning equipment. Robotic cleaning products are a relatively new concept, however they have the potential to disrupt the cleaning services market in Asia Pacific.”

The growth is primarily driven by the upsurge in demand from China, Japan and India. What are the main factors contributing to growth in India? And what can other cleaning regions learn from the Indian case in terms of growth and expansion? In other words, what is the cleaning industry doing right?

“India is the potential market for the growth of cleaning services market due to high population base, growth in disposable income, and rise in consumers’ awareness. In the past, the cleaning industry in India was not so vibrant. The flexibility in the laws has made it easier to start a successful cleaning company in India. And the relatively low capital investment, low level of market share and the extreme demand for the cleaning services in the country has given a new life to the cleaning industry in India.”

Usually when a certain industry grows rapidly, a problem could be that of shortage of labour. Is this a problem for a regional economic power like China?

“Thanks to the boom in China’s economy, the country is facing labour shortages, mainly in the coastal province of the country. But this shortage is compensated by the migrant workers from other provinces in the country.”

Until 2022 what will be the most important trends in Asia Pacific, based on your estimations for the region’s growth until that year?

“Trends which are likely to be the most important until 2022 are the increase of automation and use of AI powered robots in cleaning; increased demand for construction and post-construction cleaning services; increased demand from commercial customers; and transformation of cleaning services from luxury to necessity.”

You also mention in the report that the “escalation in construction of commercial and non commercial buildings” is one of the major growth factors. For what cleaning tasks has this especially been a major factor for growth?

“Increase in the construction of railways and roadways across the different geographies increased the demand for various cleaning services such as stone cleaning, debris cleaning, and others. Growth in post-construction cleaning, which includes debris cleaning and waste disposal. These are the services that are in demand at construction and renovation sites. Emerging economies such as China and India hold great opportunity for these services in coming years.”

Key challenges

What are the possible downsides of all this growth? What are the challenges for the professional cleaning industry of Asia Pacific?

“The main challenge faced by the professional cleaning industry is intense competition in the market. The cleaning services market in Asia Pacific is characterised by high competition predominantly in developing regions.

Few large companies have a significant presence in the market by serving customers with multiple locations, whereas large number of small companies compete efficiently in local markets,
especially for small businesses and residential customers.”

Could you perhaps break down per country what are the most relevant growth numbers when it comes to the professional cleaning industry?

“The market for cleaning services in Asia Pacific is likely to grow at a CAGR of seven per cent from 2016 to 2022. Furthermore, the professional cleaning industries in China, Japan and India are likely to grow at CAGRs of 6.7 per cent, seven per cent and 7.4 per cent respectively during the forecast period.”

 

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