The market for reception and concierge services - Italy

1.2 The world market

The market for reception and concierge services is divided into:

Residential concierge: involves the presence of a concierge who has the functions of security, cleaning, and receiving mail and packages. The latter function is gaining in importance in recent years with the great growth of online shopping. Office reception services: are often outsourced to specialized companies; they have security and representation functions. Hotel front desk services: form part of the service offered by hotels and have, in addition to a security function, the function of assisting customers with various needs.

The concierge services market was valued at $***.* million in ****, and is expected to grow steadily until ****, with a CARG of *.*%.

Concierge services market World, ****-****, millions of dollars Spherical Insights

Concierge and front desk activities are premium services, and their growth is driven by growth in disposable income, and demand for personalized and luxury services.

1.3 The Italian market

In Italy, the condominium concierge is a condominium employee whose main duty is to guard the building's entrance. In addition to this service, over the years this figure has been entrusted with other duties such as:

The cleaning of the common areas of the building The sorting of corrspondence The receipt of postal packages The verification of compliance with the condominium regulations Supervising the use of common services

Often, the concierge also has a representative function. In some condominiums, his or her appearance and attire helps to give the property a sense of exclusivity and luxury.

The appointment of this figure is made by the condominium administrator, subject to a resolution of the condominium meeting. Often, there is also provision for the concierge to have accommodation within the building, usually on the ground floor.

This market is studied within that of integrated management services to buildings; in recent years, it had experienced slight growth in Italy, which became more pronounced in ****. However, the covid has brought a setback that has brought total industry revenues back below **** levels.

Integrated building management services market (***) Italy, ****-****, € billion Istat

1.4 The impact of covid

The building management services sector suffered a setback due to the pandemic, with an **.* percent reduction in turnover [***].

Regarding particularly concierge and front desk services, the greatest difficulties were experienced due to the shutdown of the Ho.Re.Ca. sector as a result of restrictions imposed on travel and tourism. How services are provided has also changed, in addition to the use of face masks, interpersonal interactions have been kept to a minimum. Some hotels opted for contactless check-in services, which replaced receptionists with computers.

As the pandemic passed, the industry returned to growth, driven mainly by the recovery of tourism, especially luxury tourism, which grew by * percent between **** and **** [***].

The post-pandemic recovery has also brought a growth in demand for personalized experiences, captured especially by the retail sector [***]. Concierge and front desk services are particularly well suited to meet these kinds of needs:

In the hotel industry, through the unique assistance that receptionists offer customers, providing advice on places to visit and assistance toward any guest problems or needs. In the real estate sector, by providing a human figure with whom residents deal daily, and with whom they often also develop relationships of friendship and trust.

Finally, the growth in ...

2.1 Demand analysis

Demand for concierges and receptionists has truncated in recent years, particularly in large cities such as Milan, where even in the under-** bracket, having a condo concierge is among the positive features to look for in a home whether for rent or sale [***].

The concierge is appointed through a condominium assembly, which must pass a resolution with a majority representing at least half the value of the building. The salary of this figure is based on the pay scales established by the national labor contract according to the duties he or she will have to perform. Once the assembly resolves on the adoption of a concierge, no condominium owner can escape the expense of his or her salary, which is divided according to millessimals and is part of the condominium expenses.

Italian condominium expenses have decreased in recent years whereas there was a global inflation. In ****, the decrease was -*.*% compared to **** and -*.*% compared to ****.

Evolution of condominium expenses Italy, ****-****, (***) Istat

This trend signals an increased focus of condominiums on common expenses.

2.2 Demand drivers

Residential market

There are two main drivers of demand for concierges in residential buildings [***]:

Safety: concierges ensure that access to the building is granted only to residents and their guests, and they often perform a surveillance service to the building's outdoor spaces as well. In Italy, crimes and particularly predatory crimes increased by * percent in ****. Those include crimes aimed at attacking other people's movable property and they increased by **.* percent to ***,***, while robberies increased by **.* percent [***]. This leads to an increased demand for security that front desk services are meeting. Parcel pickup: In Italy, eCommerce has grown significantly in recent years, registering +**% in **** and +*% in **** [***]. In apartment buildings, parcel pickup is made easier and more effective by the presence of porters, who can guard the products even if the recipients are absent, thus preventing the courier from taking them back and having to schedule a new delivery. This is why their presence is increasingly appreciated by apartment buildings.

2.3 Geographical distribution of demand

The average condominium expenses, which also include expenses for concierge services, vary greatly by geographic area. The northwest is the area in Italy that records the highest spending, with an average of €**.** per month, so this area likely has the highest propensity to invest in concierge services, which is a premium product, as seen previously. On the other hand, the south and the islands record significantly lower levels of spending, at €**.** per month and €**.** per month, respectively.

An extremely interesting high figure that could guide the choice of which territories to focus on to offer concierge and reception services is the difference between average condominium spending in urban territories and that in suburbs and large and small municipalities.

Average condominium expenses Italy, ****-****, €/month Istat

The central areas are precisely the ones recording the highest expenditure. This difference could be largely explained by the lower use of concierge services in the suburbs and small towns.

In addition, the central areas are the only ones where the figure is rising sharply, thus following the trend of crimes committed, which, as we saw in the previous point, are on the rise.

3.1 Market structure

The number of firms active in the sector of providing integrated building management services - which includes concierge and surveillance services - has increased significantly in recent years, registering +*.* percent in ****.

Number of enterprises in the sector of providing integrated management services to buildings (***) Italy, ****-****, in numbers. Istat

The number of people employed in the sector has also steadily increased, registering its only decline in ****, because of the pandemic (***).

Evolution of  the number of people employed in the sector: provision of integrated management services to buildings (***) Italy, ****-****, in numbers. Istat In terms of legal form, there is a prevalence of sole proprietors, freelancers and self-employed, and Limited Liability Companies. The legal form of enterprises active in the provision of integrated management services to buildings (***) Italy, ****, in numbers. Istat

3.2 The value chain

3.3 The main players

Italian companies operating in the reception and concierge services market are mainly large armed surveillance or facility management companies, which are adding to their portfolio of services offered with concierge, reception, and concierge activities. The most important ones are:

Sicuritalia, Mondialpol Facility S.c.a.r.l., Cosmopol S.p.a, Italpol Vigilanza S.r.l., Servizi Integrati S.r.l., Centrogest S.p.a., CMF Consortium, FSI S.r.l.

4.1 The type of supply

The concierge and concierge service offerings are divided into:

4.2 The prices

The average monthly salary of a residential building concierge is €****.** [***]. To this must be added several allowances:

*.**€ for every ** cadastral rooms, *.**€ for each elevator or freight elevator, *.**€ for cleaning the stairs of any floor, *.**€ for cleaning yards and green spaces, *.**€ to *.**€ for collecting registered mail, *.**€ for opening and closing the front door.

The costs of concierge and concierge services are thus broken down as follows:

Prices vary depending on the type of service required, as well as the location, period, and duration of the service.

5.1 The regulation

The Civil Code does not deal with disciplining the concierge service. Therefore, the legislature has not addressed important issues such as the establishment and termination of the concierge's employment relationship and the related allocation of expenses. To resolve these issues, therefore, reference must first be made to the condominium bylaws. In the absence of this document or the relevant regulation, the reference rule is the first paragraph of Article **** of the Civil Code, which indicates that each condominium owner shall share the expenses inherent in the concierge service in proportion to the millesimal value of his or her real estate unit.

The activity of the concierge falls in any case within the broader category of unarmed surveillance, regulated by Ministerial Decree ***/**** and Title IV of the Consolidated Law on Public Security.

6.1 Segmentation

The segmentation of this market distinguishes companies in the armed security sector and companies operating in the facility management market. Many companies supplement their portfolio with security, concierge, and reception services. The few companies that specialize in these services are, in contrast, very small, so much so that they are insignificant in size compared to those that are part of the first two meated groups.

Concierge firms:

Facility Management Companies:

• SicurItalia IVRI S.p.a.
• Mondialpol S.p.a.
• Cosmopol S.p.a.
• Italpol S.r.l.
• Servizi Integrati S.r.l.
• Centrogest S.p.a.
• Consorzio Stabile CMF
• Reclean Società Cooperativa