CONTRACT MAINTENANCE

• Contract Maintenance is defined as the contract between 2 parties which creates the agreement that one party will maintain an asset owned by another party, which is common across many industries.
• Maintenance contracts can exist for equipment, a building, landscape, computers and other information technologies, and more.
• The decision to perform a particular maintenance activity in – house or through contract is usually decided by the head of the Maintenance Department.

Possible Circumstances for availing Contract Maintenance

• While contract maintenance may cover all possible types of maintenance including routine, preventive an corrective maintenance, some specific areas or circumstances might require contract maintenance as mentioned below.
• Contract Maintenance may handle special needs of a property involving special equipment’s or when such needs are infrequent in nature.
• E.g.: Fire Extinguishers, Lifts, Fire Alarm Systems, Detectors, Sensors etc.
• Contract Maintenance may be called upon for routine services such as janitorial services for all sorts of building interior cleaning.
• Ground maintenance and special maintenance needs like pest control activities (needing license from IPCA) are generally awarded to contract maintenance.
• In many properties, operation and maintenance of water treatment, sewage treatment and swimming pool maintenance are left to contract service owing to their very sophisticated nature.
• At small establishments, air – conditioning and refrigeration units are also maintained through contract service.
• Special equipment’s are often needed for cleaning kitchen ducting, grease trap, grease filters etc., and their maintenance is also often contracted out.

ADVANTAGES OF CONTRACT MAINTENANCE

• Reduction of total labor cost.
• Reduction of cost of carrying inventory and special maintenance equipment.
• Use of the latest techniques and methods of maintenance.
• Saving in administrative time on the part of the engineers when they can concentrate more on planning, etc.
• Structure and infrastructural facilities of the in-house maintenance department need not change due to the introduction of new equipment’s with sophisticated technology.
• Flexibility to meet emergencies
• Reduction of the labor problem.
• Need to recruit and train employees are eliminated.

DISADVANTAGES OF CONTRACT MAINTENANCE (Potential)

• Labor cost is not really saved unless the actual number of in-house maintenance staff is reduced.
• Revision of contract fees in subsequent years often leads to the escalation of total cost if not properly negotiated and controlled.
• Often the specialized nature of the maintenance would lead to high charges for such contracts leading to an overall increase in maintenance cost compared to if it were maintained in house.
• At the time of bidding, lack of initiative on the part of the Chief Engineer would often lead to a non-competitive price quote by a handful on contractors.
• Reduction in the number of specialized in-house maintenance crew may result in their unavailability in case of an emergency requirement for some other facility.
• The Chief Engineer does not get any information feedback regarding the status of the equipment under contract maintenance, except in case when it completely breaks down.
• Loss of control over contractor employees.