How profitable are cleaning services?

18 replies
I was considering selling corporate cleaning services, by generating leads, turning as many of those leads into sales as possible and then outsourcing the work to workers who are in need of additional income.

I'm sure finding cheap labour will be straightforward, but I was wondering how much corporate clients would be willing to pay and so forth? For example (in the UK), my math doesn't make it sound very appealing:

2 hours of office cleaning at £100
Outsource between 3 workers x £7/hour = £42
Profit = £58
15 clients a month; profit of £58 x 15 = £870
Annual profit of £870 x 12 = £10,440

Even if I doubled the price to £200 and found 30 clients per month, that's £56,880 which is decent, but I'd rather enter a business where the earning potential is well into the six-figures, or I'm sort of limiting my future.
#cleaning #profitable #services
  • Profile picture of the author ewenmack
    Originally Posted by MegaHold View Post

    I was considering selling corporate cleaning services, by generating leads, turning as many of those leads into sales as possible and then outsourcing the work to workers who are in need of additional income.

    I'm sure finding cheap labour will be straightforward, but I was wondering how much corporate clients would be willing to pay and so forth? For example (in the UK), my math doesn't make it sound very appealing:

    2 hours of office cleaning at £100
    Outsource between 3 workers x £7/hour = £42
    Profit = £58
    15 clients a month; profit of £58 x 15 = £870
    Annual profit of £870 x 12 = £10,440

    Even if I doubled the price to £200 and found 30 clients per month, that's £56,880 which is decent, but I'd rather enter a business where the earning potential is well into the six-figures, or I'm sort of limiting my future.
    You've got 3 big hurdles...

    1 Have you had any experience generating leads and closing them?

    2 Long gone are the days of a mop, bucket and cleaning fluids
    to get the job done...do you know that?

    3 Low skilled workers who take cleaning jobs
    have real challenges keeping to commitments...
    have you previously been in charge of them, recruited them and
    fired them?

    Is this the type of business, that will always have those problems,
    what you want to deal with on a daily basis?

    Take some serious thinking around it.

    Best,
    Ewen
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    • Profile picture of the author Cali16
      [DELETED]
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      • Profile picture of the author mojo1
        Another major point to be considered is whether you're willing to do the job,
        when and not if one of your workers doesn't show up for work.
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        • Profile picture of the author DWolfe
          Another thing to consider is you or your crew will be working at nights and on weekends.

          During the day the offices are in use and the company's will not want a crew interrupting the days normal flow of business.

          You will also want to screen your workers, if one turns to criminal activity you have a serious legal issue to worry about.

          On the other hand if you choose to work a few hours after the normal day you can create a side business. Their are two brothers in town that clean store front windows and they seem to be doing ok.
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          • Profile picture of the author DABK
            My first job ever was cleaning a golf club house together with 3 other people. Took a couple of hours, 4 people. We got paid $600 a month. In today's dollars (buying power) that would be like getting $2,400. Back then, rent on a super large, super nice 3-bedroom unit in a nice neighborhood was $600 a month.

            That said, we showed up 6 days a week, at 10 PM, except Fridays and Sundays, when it had to be 11:30 PM.

            A few months into the job, having made friends with the club manager, we found out that he was paying the guy who hired us $1,500 a month. We arranged to be paid directly by him, $1,250. He was happy, we were happy.

            The way to make money in this business, is to get places that need cleaning daily or get a lot of placed that need cleaning once a month.

            And to charge 2.5 times what you pay your workers.

            Well, based on my experience.

            So

            2 hours of office cleaning at £100
            Outsource between 3 workers x £7/hour = £42

            might have to look like
            2 hours of office cleaning at 100
            Outsource between 2 workers x7/hour=72

            PS There was no insurance, we had not been screened for anything (which, in retrospect is really interesting, because before cleaning the club, we worked for the same guy cleaning a bank).

            PPS What Russ said about commitments is true, which means that you should have backup workers, ready to go, or you do a lot of cleaning by yourself.

            Maybe you do something like the merry and molly maids do:
            themaids92.calls.net/92/
            mollymaid.com/

            Or bring them leads (less money per lead, but you also have a lot fewer headaches).
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  • Profile picture of the author bizgrower
    If you Google it, you can find a guy in the States who
    writes about how to make six figures a year cleaning
    windows.
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  • Profile picture of the author MegaHold
    Thanks for the replies. The more I think about it the less appealing it seems. Perhaps this isn't as easy as I thought... I was just looking for a service that is easy to outsource so I can focus my efforts on making sales.
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    • Profile picture of the author sweetcrabhoney18
      Nothing is "easy" in business it all takes work . Even outsourcing elements of the job takes work. Its a time investment.
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      keep moving forward

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  • Profile picture of the author umc
    Originally Posted by MegaHold View Post

    I was considering selling corporate cleaning services, by generating leads, turning as many of those leads into sales as possible and then outsourcing the work to workers who are in need of additional income.

    I'm sure finding cheap labour will be straightforward, but I was wondering how much corporate clients would be willing to pay and so forth? For example (in the UK), my math doesn't make it sound very appealing:

    2 hours of office cleaning at £100
    Outsource between 3 workers x £7/hour = £42
    Profit = £58
    15 clients a month; profit of £58 x 15 = £870
    Annual profit of £870 x 12 = £10,440

    Even if I doubled the price to £200 and found 30 clients per month, that's £56,880 which is decent, but I'd rather enter a business where the earning potential is well into the six-figures, or I'm sort of limiting my future.
    I've been cleaning for 14 years, so I have some perspective on this.

    1. Finding cheap labor is the most difficult thing that you will encounter. There's a reason that cheap labor is cheap. Good luck finding cheap labor that shows up and does a good job.

    2. Speaking of doing a good job, do you know what your customer's expectations will be? Do YOU know how to clean? How will you maintain any quality standards? If you don't, you will lose those jobs as quickly as you get them.

    3. Do you know the accuracy of your figures? For instance, is 2 hours of office cleaning in your area really going to fetch 50/hour? I'm a member of some cleaning associations and from what I've seen, at least in the residential side of things, it can be difficult to get anywhere near that kind of money for cleaning. Maybe commercial is different, but do your due diligence to find out what kind of money is really available for that kind of work.

    4. What services will you offer? Just basic office cleaning, or what if your corporate clients also need carpet cleaning, or floor stripping/waxing, or window cleaning, etc. Do you know how to price the various services, how to perform them, and what supplies/equipment you will need?

    True, you don't need to know everything, but we always found office cleaning to be very cutthroat. Someone comes in and underbids you and boom, you're gone. It is very much a commodity because they often don't have much of a relationship with you. We much prefer residential cleaning, but that's just us, and my wife and I don't hire out either. We do it all ourselves and build relationships and enjoy what we do, which is difficult to do in a commercial setting. Then again, residential cleaning is much more varied and difficult, so there are always pros and cons to any such situation.

    Best of luck with it, but you need to realize that there is far more involved than simply sitting back, generating leads, and finding people to fulfill them. Someone has to sell and be the point man for everything that goes on, someone has to do some quality checks particularly if you're hiring cheap labor, someone has to fill in when they don't show up, someone has to do the books and set the quality standards, etc. I know people that have successful cleaning businesses, but in my view most of them have just swapped out doing the cleaning for managing the employees that are usually a pain in the rear, and they don't seem to make a great deal of profit over if they had done the work themselves.
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    • Profile picture of the author rhinocl
      Look at this differently. You don't want to be handling hiring training, insurance (liablitity and workers comp) and supervision yourself. Find small cleaning companies that are not franchisees and offer to find them leads for a percentage of the profits. The further you take each potential client in the closing process the more they should pay you.
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  • Profile picture of the author swilliams09
    Check out this sub reddit where several guys started their own cleaning companies.

    Entrepreneur Ride Along
    DAY 26: From Zero to Website Launch-A recap of everything that got us here! : EntrepreneurRideAlong
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  • Profile picture of the author zimbizee
    Profitable???
    Well my mates parents just sold their cleaning biz last year here in the UK and retired to Oz
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  • Profile picture of the author garry6767
    Your biggest challenge is going to be finding great workers and keeping them. Make sure you check the references for everyone.
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  • Profile picture of the author ErinWalsh
    Cleaning business's is a great investment, but takes a lot of work just getting started.
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  • Profile picture of the author ryansjacket
    I love the cleaning business.... Super easy to get started, low investment needed & some of your most effective advertising methods are practically FREE... Yes man power can be a little tricky, but you shouldn't take too long to find stable help !
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    • Profile picture of the author StarkContrast
      I love the cleaning business.... Super easy to get started, low investment needed & some of your most effective advertising methods are practically FREE

      So, Ryansjacket, how long have you been in the cleaning business and what kind is it: residential/commercial? How soon before you started making a stable income? Are you talking Youtube, classifieds and similar for the FREE advertising?
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      • Profile picture of the author OnlineStoreHelp
        Here in the states there are a few other things to consider...

        Liability Insurance - No commercial property in their right mind is going to let you in without some kind of liability policy and including them as additional insured.

        Outsourcing - States are cracking down on "outsourcing". If you are telling them what to clean, how to clean and when to clean, even if you pay them 1099, many states will tell you, they are employees. You need have workers comp and pay into the Unemployment Insurance. Add in the Affordable Care act, you now have insurance to pay for as well.

        Environmental/Disposal - Many places won't let you dispose of cleaning supplies in their dumpsters many times. You now have to cover the cost of disposal.

        The cleaners I know that do well, have full time employees, lots of commercial accounts. One I know is actually a water remediation company that does cleaning between the big remediation jobs...
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        • Profile picture of the author Rus Sells
          This is going to be your biggest hurdle but one thing that was left out was that you'll most likely need to be bonded to protect against any theft from employees.

          Originally Posted by OnlineStoreHelp View Post

          Here in the states there are a few other things to consider...

          Liability Insurance - No commercial property in their right mind is going to let you in without some kind of liability policy and including them as additional insured.

          Outsourcing - States are cracking down on "outsourcing". If you are telling them what to clean, how to clean and when to clean, even if you pay them 1099, many states will tell you, they are employees. You need have workers comp and pay into the Unemployment Insurance. Add in the Affordable Care act, you now have insurance to pay for as well.

          Environmental/Disposal - Many places won't let you dispose of cleaning supplies in their dumpsters many times. You now have to cover the cost of disposal.

          The cleaners I know that do well, have full time employees, lots of commercial accounts. One I know is actually a water remediation company that does cleaning between the big remediation jobs...
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  • Profile picture of the author isaacsmithjones
    Originally Posted by MegaHold View Post

    I was considering selling corporate cleaning services, by generating leads, turning as many of those leads into sales as possible and then outsourcing the work to workers who are in need of additional income.

    I'm sure finding cheap labour will be straightforward, but I was wondering how much corporate clients would be willing to pay and so forth? For example (in the UK), my math doesn't make it sound very appealing:

    2 hours of office cleaning at £100
    Outsource between 3 workers x £7/hour = £42
    Profit = £58
    15 clients a month; profit of £58 x 15 = £870
    Annual profit of £870 x 12 = £10,440

    Even if I doubled the price to £200 and found 30 clients per month, that's £56,880 which is decent, but I'd rather enter a business where the earning potential is well into the six-figures, or I'm sort of limiting my future.
    I work with a steam cleaning company, and it is one of my favourite clients to work with, because it is so easy to generate leads and customers. And trust me, it's completely realistic to earn well into 6 figures profit with cleaning. But we'll get into that in a second.

    However, as others have said, GOOD labour is one of the hardest things to find. One of the biggest limiting factors for my client is the fact that she offers a FANTASTIC service. So it's hard for her to find employees who will match that standard.

    Anyway, looking at the maths, it's pretty SIMPLE (but necessarily not easy) to earn over 6 figures. You just need to tweak how you look at things. Now, you're gonna have a lot of jobs on your plate if you do build things to this level, so again, the labour is the issue.

    The trick is REPEAT customers. But to have customers come back to YOU in such a competitive industry isn't so easy, especially when you're trying to do things on the cheap. But here's the maths.

    Using your numbers, you said that 1x 2 hour job would be worth £58 profit.

    How often are people likely to want that sort of cleaning? Every day? Every week? Every month?

    Let's say just once every two weeks.

    * This means that 1 client is worth 26 weeks times £58, which is £1,508 per year.
    * If you're gaining 15 clients each month, let's say that only 6 of these clients choose to stay for a full year. This means that by the end of the year, you'll have 72 repeat clients, each worth around £1,500.
    * That's £108,000 worth of business.

    Now, since this is residual income, you're not gonna have the full £108,000 by the end of the first year. But you'll have about half of it.

    On top of that... Look at all the stuff I haven't accounted for.

    I've IGNORED 9 jobs each month.

    I've UNDERESTIMATED how often people return - Only 1ce every 2 week. Image if that once once a week. Or multiple times each week?

    I've assumed that only 6 out of 15 people will become repeat customers. What if that number could be 8 or 10?

    The simple fact is: You could make over £100,000 profit, with just 6 new loyal customers each month.

    But if you build a REAL business from the start, with a clear USP and niche, and you don't get into that mentality of:

    "What's the cheapest way to X"...

    Then your job will be much more fun, and much more rewarding.

    But as you're in the UK, I'd love to have a chat about how you're looking to go about things, and maybe we could share some ideas.
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