Maximising Efficiency: The Importance of Outsourcing
A report from The King’s Fund published in May 2025 has outlined that the NHS is in one of its most pressurised financial positions in its history, at a time when the UK’s healthcare system is also needing to adjust to several upcoming changes.
Take a look at our cost savings matrix to find out how much outsourcing could save a Trust or Wholly Owned Subsidiary.
Deficits across NHS systems reached £1.4bn in 2023/24, according to The King’s Fund1, which is a significant increase from the £517m in 2022/23.
One solution suggested by Sir Jim MacKey2, the transition CEO of NHS England, is that hospitals should be looking at alternative ways of delivering support services to reduce costs, such as sub-contracting. Implementing this change could help Trusts add robustness and resilience at a time when several other factors are impacting the way they work:
The Government has set out changes to the country’s immigration system3, adding further governance to overseas recruitment.
NHS England being merged with the Department of Health and Social Care4, aiming at removing duplication.
Integrated care boards (ICBs) needing to reduce running costs by 50%5.
Deliver average savings of 7.5%, according to calculations made by the Government7.
Allow leaders to avoid putting undue pressure on current staff members by meeting capacity in new ways.
Contain costs in an inflationary environment.
Free up management time, so that more focus can be put on clinical challenges.
Help to gain quicker access to capital when pressure is being placed on public funding.
Improve services by drawing on experience and innovative practices.
Even small percentage reductions can result in significant budgetary gains — especially across these core NHS EFM services
Using the Estates Returns Information Collection (ERIC) data for 2023/24, we can calculate the value of the Government's estimated 7.5% efficiency saving by outsourcing. The table below provides the average saving PA of the core Soft FM services for those NHS Trusts which still deliver these services in house.
Number of beds
Cleaning savings
Portering savings
Food service savings
Soft FM savings
Total
0-249
£176,020
£46,415
£126,156
£117,296
£465,887
250-499
£395,650
£121,701
£297,303
£224,254
£1,038,908
500-749
£408,313
£149,909
£334,175
£273,175
£1,165,572
750-999
£601,246
£218,099
£560,392
£483,153
£1,862,890
1000-1499
£937,230
£274,724
£794,796
£745,073
£2,751,823
1500+
£1,488,466
£475,604
£1,169,010
£994,310
£4,127,390
Average saving PA of the core Soft FM services for those NHS Trusts which still deliver these services in house based on a 7.5% cost saving.
Across NHS acute providers, it is estimated that approximately half outsource support services, and many of these outsource a bundled set of services. This includes patient food, staff and visitor food and retail services, along with cleaning and other soft facility services. In doing so, this allows a greater focus on patient clinical care, enabling resourcing economies of scale for the support service provider, thus driving value for the Trust.
Realising the benefits of outsourcing
1. Financial Efficiencies and Cost Reduction
Even as far back as 2008, a report for the Department of Business, Enterprise and Regulatory Reform (referred to in The Future of Outsourcing and Partnerships in UK Health and Care report) detailed that outsourcing could deliver between 10% and 30% cost savings, without compromising service quality.
More recently, Sodexo has shown how its technological and innovative approach can help drive efficiency and reduce clinical down time.
Working exclusively with Xempla, a Decision Automation System for asset performance management, Sodexo integrated operational data from several mechanical assets for Manchester University NHS Foundation Trust8. Enhancing visibility of asset performance, Sodexo was able to help avoid critical asset failure, reduce energy consumption and optimise maintenance workloads, resulting in some outcomes for the Trust:
Prevented 83 critical asset outages
Over £300k reduction in energy costs
Over 2.5k tonnes less carbon into the atmosphere
Over 1.2m kWh reduction in electrical energy consumption
Sodexo has a super resilient supply chain too, with three quarters of this comprised of small and medium-sized enterprises (SMEs) like Xempla and social enterprises. In addition to bringing new and exciting innovations, this also adds resilience as the outsourcing partner can maintain costs at times of inflation.
2. Operational Resilience and Workforce Scalability
Outsourcing enables those in both corporate and healthcare sectors to benefit from flexible staffing, rapid mobilisation and continuity during surges or crisis scenarios too.
Sodexo showcased its ability to be able to quickly mobilise a workforce in July 20219. Over 3,000 employees were transferred to the Health & Care segment10 to manage more than 110 physical test centres and mobile units within a ten-week period during the height of the COVID-19 pandemic.
In April 2025, the organisation began a five-year contract with East Suffolk and North Essex NHS Foundation Trust (ESNEFT) to deliver soft facilities management services11 to two of the Trust’s acute hospitals, Ipswich and Colchester. Community services will be provided across North Essex and East Suffolk as well.
When the partnership was announced in December 202412, Philip Leigh, CEO of Health & Care at Sodexo UK & Ireland, commented: “We are delighted to be working alongside East Suffolk and North Essex NHS Foundation Trust. We are committed to supporting the Trust’s priorities and collaborating with them to enhance environments and experiences for patients, staff and the local community.”
When the partnership was announced in December 202412, ESNEFT’s Chief Executive, Nick Hulme, commented: “Working in partnership with Sodexo will help us to ensure the high standards of care and experience which patients and local people rightly expect. This is critical to our plans to transform services for local communities.”
Outsourcing relationships such as this one are sure to mitigate the workforce pressures in the NHS, especially when the NHS Estates & Facilities Workforce report by the Hospital Caterers Forum13 found that the organisation’s vacancy rate was recorded at 6.7% as of January 2025, the combined Estates and Admin vacancy rate stands at 7.7% and 41% of the NHS EFM workforce is aged 55 and over.
3. Improved Service Delivery Through Innovation
Organisations like Sodexo are now going beyond the traditional food and FM services – offering Trusts enhanced benefits from innovation, driving greater assurance, efficiency and experience.
The introduction of new technologies, better processes and global best practices that may be out of reach for internal teams become available through global outsourcing partnerships.
Sodexo’s innovative Xempla system has already highlighted efficiencies gained through new innovation. Experiencia14, another digitised service, sees human interactions combined with real-time data, delivering better patient-centred services.
Commenting on the experience of using this unique insights platform, the Acting Group Director of Estates & Facilities and Commercial Director at the Manchester University NHS Foundation Trust said15: “We’re delighted to be seeing patient data from Experiencia.
“The Sodexo ambassadors have been excellent in engaging not only our patients but also our nursing teams at ward level, meaning they are getting a better understanding about cohorts’ issues and responding to individuals during hospital stays.”
Simon Lilley, Director of Strategy & Marketing, Sodexo Health & Care UK & Ireland, also stated16: “The Experiencia platform is unlike anything else in the UK today.
“This unique platform can help to have a positive impact on the length of stay and patient satisfaction.”
It is not just state-of-the-art technology, which outsourcing partners can bring to the table though – beneficial workplace practices can be introduced too. Take Sodexo’s food waste reduction programme, WasteWatch17, as a demonstrable example here.
Part of the organisation's commitment to half its food waste by August 2025, this measurement system allows kitchen teams to better understand what is being thrown away and why. More informed menu choices and efficiencies can then be made, all of which is backed up by real-time data.
Claire Atkins Morris, the Sustainability Director at Sodexo UK & Ireland, pointed out18:
“WasteWatch gives us the data and insights needed to understand where waste is happening and take targeted action to prevent it.
“As a global leader in delicious, sustainable, and nutritious food, we are committed to driving innovation that benefits both people and the planet.”
As outlined in this article, outsourcing not only drives greater efficiencies than in-house delivery, but other significant benefits such as innovation to hospitals and the wider health and care system. This way of working has now also become a strategic enabler of resilience, value and sustainability for the healthcare industry, allowing organisations to remain focused on delivering impact where it matters most.
