How to Open & Operate a Financially Successful Cleaning Service With Companion CD-ROM
By Beth Morrow
()
About this ebook
A lot of people believe that they can set up and operate a cleaning business that will reap big profits with a few dollars and some cleaning supplies. The reality is most of these startups fail in a couple of months. However, armed with the detailed information in this book, you can have your recession-proof cleaning business up and running quickly.
You will learn how to build your client list, bid on jobs, organize your schedule, and maximize your time and profits. You will learn everything you need to know BEFORE starting your cleaning business. A cleaning service can be run part- or full-time and can easily be started in your own home. As such, these businesses are one of the fastest growing segments in the service economy.
While providing detailed instructions and examples, the author leads you through finding a location that will bring success, buying (and selling) a cleaning service, pricing formulas, sales planning, tracking competitors, bookkeeping, media planning, pricing, managing and training employees, successful budgeting, and profit planning development, as well as thousands of great tips and useful guidelines.
By reading this book, you will become knowledgeable about basic cost control systems, Web site plans and diagrams, software and equipment layout and planning, sales and marketing techniques, legal concerns, IRS reporting requirements, customer service, monthly profit and loss statements, tax preparation, public relations, general management skills, low and no cost ways to satisfy customers and build sales, and auditing. In addition, you will learn how to draw up a winning business plan, how to set up computer systems to save time and money, how to hire and keep a qualified professional staff, how to generate high profile public relations, and how to keep bringing clients back.
Learn new ways to make your operation run smoother and increase performance. Shut down waste, reduce costs, and increase profits. In addition owners will appreciate this valuable resource and use it as a reference in their daily activities and as a source for ready-to-use forms, Web sites, operating and cost cutting ideas, and mathematical formulas that can be easily applied.
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How to Open & Operate a Financially Successful Cleaning Service With Companion CD-ROM - Beth Morrow
How to Open & Operate
a Financially Successful
Cleaning
Service
With Companion CD-ROM
By Beth Marrow
How to Open & Operate a Financially Successful Cleaning Service —
With Companion CD-ROM
Copyright © 2008 by Atlantic Publishing Group, Inc.
1405 SW 6th Ave. • Ocala, Florida 34471 • 800-814-1132 • 352-622-1875–Fax Web site: www.atlantic-pub.com • E-mail: sales@atlantic-pub.com SAN Number: 268-1250
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without the prior written permission of the Publisher. Requests to the Publisher for permission should be sent to Atlantic Publishing Group, Inc., 1405 SW 6th Ave., Ocala, Florida 34471.
ISBN-13: 978-1-60138-144-6
ISBN-10:1-60138-144-1
Library of Congress Cataloging-in-Publication Data
Morrow, Beth (Nancy Elizabeth), 1971-
How to open & operate a financially successful cleaning service : with companion CD-ROM /
Beth Morrow.
p. cm.
Includes bibliographical references and index.
ISBN-13: 978-1-60138-144-6 (alk. paper)
ISBN-10: 1-60138-144-1 (alk. paper)
1. Buildings--Cleaning. I. Title. II. Title: How to open and operate a financially successful cleaning service.
TX958.M67 2008
648--dc22
2008024786
LIMIT OF LIABILITY/DISCLAIMER OF WARRANTY: The publisher and the author make no representations or warranties with respect to the accuracy or completeness of the contents of this work and specifically disclaim all warranties, including without limitation warranties of fitness for a particular purpose. No warranty may be created or extended by sales or promotional materials. The advice and strategies contained herein may not be suitable for every situation. This work is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional services. If professional assistance is required, the services of a competent professional should be sought. Neither the publisher nor the author shall be liable for damages arising herefrom. The fact that an organization or Web site is referred to in this work as a citation and/or a potential source of further information does not mean that the author or the publisher endorses the information the organization or Web site may provide or recommendations it may make. Further, readers should be aware that Internet Web sites listed in this work may have changed or disappeared between when this work was written and when it is read.
Printed on Recycled Paper
INTERIOR LAYOUT DESIGN: Vickie Taylor • vtaylor@atlantic-pub.com Printed in the United States
Dedication
A book is the result of many people coming together. To that end, I would like to thank:
9 My editor, Angela Adams, for your help and patience. Working with you was a terrific experience.
9 My parents, Dick and Pat Frazee … for everything. You’re the best.
9 Paul, Jason and Omar for not complaining about pizza and takeout.
9 The serious writers: Rosemary, Donna, Stephanie, Molly, and Katie for keeping me on track with my goals.
9 All the generous cleaning industry professionals who shared their time, talent and insights with me. Without you, there would be no book.
We recently lost our beloved pet Bear,
who was not only our best and dearest friend but also the Vice President of Sunshine
here at Atlantic Publishing. He did not receive a salary but worked tirelessly 24 hours a day to please his parents. Bear was a rescue dog that turned around and showered myself, my wife Sherri, his grandparents Jean, Bob and Nancy and every person and animal he met (maybe not rabbits) with friendship and love. He made a lot of people smile every day.
We wanted you to know that a portion of the profits of this book will be donated to The Humane Society of
the United States.
–Douglas & Sherri Brown
The human-animal bond is as old as human history. We cherish our animal companions for their unconditional affection and acceptance. We feel a thrill when we glimpse wild creatures in their natural habitat or in our own backyard.
Unfortunately, the human-animal bond has at times been weakened. Humans have exploited some animal species to the point of extinction.
The Humane Society of the United States makes a difference in the lives of animals here at home and worldwide. The HSUS is dedicated to creating a world where our relationship with animals is guided by compassion. We seek a truly humane society in which animals are respected for their intrinsic value, and where the human-animal bond is strong.
Want to help animals? We have plenty of suggestions. Adopt a pet from a local shelter, join The Humane Society and be a part of our work to help companion animals and wildlife. You will be funding our educational, legislative, investigative and outreach projects in the U.S. and across the globe.
Or perhaps you'd like to make a memorial donation in honor of a pet, friend or relative? You can through our Kindred Spirits program. And if you'd like to contribute in a more structured way, our Planned Giving Office has suggestions about estate planning, annuities, and even gifts of stock that avoid capital gains taxes.
Maybe you have land that you would like to preserve as a lasting habitat for wildlife. Our Wildlife Land Trust can help you. Perhaps the land you want to share is a backyard—that's enough. Our Urban Wildlife Sanctuary Program will show you how to create a habitat for your wild neighbors.
So you see, it's easy to help animals. And The HSUS is here to help.
The Humane Society of the United States
2100 L Street NW
Washington, DC 20037
202-452-1100
www.hsus.org
Table of Contents
Dedication..........................................3
Foreword ...........................................11
Introduction ....................................15
Chapter 1: Before You Begin ...........19
What Can You Expect? ........................................................................................... 21
Is the Cleaning Business Right For Me? ............................................................. 23
Traits of Successful Cleaning Business Owners ............................................... 27
Chapter 2: Types of Cleaning
Businesses .......................................33
Consumer/Residential ........................................................................................... 33
Commercial .............................................................................................................. 36
Independent ............................................................................................................. 39
Franchise .................................................................................................................. 44
Chapter 3: Types of Cleaning
Services .............................................49
Residential Cleaning Services .............................................................................. 49
Commercial Cleaning Services ............................................................................ 65
Chapter 4: Getting Off
the Ground .......................................73
Which Cleaning Business Is For You? ................................................................. 73
Legal Structure of Your Cleaning Business ........................................................ 78
Lawyer/Legal Advisor............................................................................................. 82
Accountant............................................................................................................... 84
Choosing and Registering Your Business Name ............................................... 86
Applying for a Business License .......................................................................... 89
Developing Your Business Plan ............................................................................ 93
Components of Your Business Plan ..................................................................... 95
Chapter 5: Developing Your
Financial Plan ....................................107
Evaluating Costs for Startup & Operations ......................................................... 107
Record Keeping for Success ................................................................................ 111
Accounting Methods .............................................................................................. 112
Billing, Income, and Expense Records ................................................................ 113
Financial Considerations ....................................................................................... 116
Taxes ......................................................................................................................... 118
Chapter 6: Organizing Your
Business ...........................................121
Choosing a Location ............................................................................................... 121
Organizing Your Office Space ............................................................................... 127
Office Equipment ..................................................................................................... 128
Vehicle Considerations .......................................................................................... 136
Supplies and Suppliers .......................................................................................... 138
Chapter 7: Human Resources ......141
How Many Employees Do You Need? ................................................................. 141
What Kind of Employee Do You Need?................................................................ 144
Where to Search For the Right Employees ........................................................ 145
Advertising for Employees..................................................................................... 146
The Interview Process ........................................................................................... 148
Post Interview Considerations ............................................................................. 153
Keeping Employees Happy and Productive ....................................................... 158
When Trouble Strikes ............................................................................................. 160
Training ..................................................................................................................... 163
Handbook of Company Policies and Procedures for Employees ................... 167
Chapter 8: Growing Your
Business through Marketing .........171
Target Your Market ................................................................................................. 171
Create Your Image .................................................................................................. 171
Advertising Strategy and Plan .............................................................................. 172
Advertisements of All Kinds .................................................................................. 175
Three Types of Advertisements ............................................................................ 176
Designing Your Marketing Pieces ........................................................................ 192
Ongoing Advertising Efforts .................................................................................. 192
Chapter 9: Clients: The Heart
of Your Business ............................195
First Impressions: Meeting Prospective Clients ................................................ 197
The Value of a Walkthrough .................................................................................. 201
Client Expectations: Developing a Service Manual .......................................... 209
Chapter 10: Setting Fees ................217
Considerations Before Setting Your Fees ........................................................... 217
How to Set Your Fees ............................................................................................. 219
Three Major Factors in Setting Fees ................................................................... 221
Pricing Your Services ............................................................................................. 223
Chapter 11: Roll Up Your
Sleeves & Clean ................................227
Fundamental Cleaning Strategies ........................................................................ 229
Residential and Home Cleaning ........................................................................... 230
Commercial & Janitorial Cleaning ....................................................................... 233
Carpet Cleaning ....................................................................................................... 235
Other Cleaning Services ........................................................................................ 236
Establishing Chemical and Product Inventory ................................................... 237
Chemical Storage.................................................................................................... 238
Conclusion .......................................241
Appendix A:Resources ...................243
Appendix B: Worksheets
& Checklists ....................................247
Bibliography .......................................281
Author Biography ............................283
Index .................................................285
Foreword
By Perry D. Phillips, Jr.
There are countless books and Web sites on the market that tout home cleaning and maid service businesses as one of the 100 best small home businesses
or best business to start for under $100
and most usually make claims of easy and big profits from the start. Do your homework; do not be fooled by these claims of a quick road to riches. Starting a home cleaning business is one of the easiest businesses to open. However, running, growing, and maintaining a sustainable, successful company in this industry can be quite a challenge.
Yes, it is true that you can start a legitimate home cleaning service for a very smal upfront investment, especial y if you intend to rol up your selves and
12
How to Open & Operate a Financially Successful Cleaning Service do the work yourself, and do not mind doing it the hard way for quite a while.
Building and growing a company, with al of the complex relationships, can be a daunting task even for the most seasoned of managers.
The Association of Residential Cleaning Services International (ARCSI) is pleased to see a resource like How to Open & Operate a Financially Successful Cleaning Service because it provides comprehensive information about not only how to get started, but what you can expect from the industry. I encourage you to take advantage of all learning opportunities available to you. Use these tools as you set goals for you and your new company.
Too often in this industry, individuals jump in, get started, and realize the reality of managing a financially successful business. This book along with the networking and educational opportunities ARCSI can offer will help you enjoy success in this challenging, but rewarding industry.
Along with the complex relationships and chal enges you wil face in this industry, the profit margin can be very rewarding financial y, but you must run a tight ship. The residential cleaning industry as a whole is stil very young compared to other industries. Professional, wel -run residential cleaning companies have only been around for about 25 to 30 years. Demand from consumers continues to grow even in slow economic times. This growth is expected to continue to an all-time high for many years to come.
Good luck and much success in your new endeavor!
Perry D Phillips, Jr.
Founder and Executive Director
Association of Residential Cleaning Services International www.arcsi.org
866.880.5914
Foreword
13
ARCSI, the Association of Residential Cleaning Services International is the only non-profit organization that is dedicated to advancing the residential cleaning industry as a whole. Members are provided with incredible learning and networking opportunities. ARCSI’s vision statement, To Unify, Develop, and Promote the World’s Most Successful Residential Cleaning Companies.
14
How to Open & Operate a Financially Successful Cleaning Service
Introduction
There are two types of people who want to start a cleaning business: those who are driven by profits and those who are driven by passion.
While there is nothing inherently wrong with wanting to make a profit on your business, hundreds of people each year make the decision to venture into the cleaning industry based on the assumption that if they know how to clean, they should open a cleaning business to make quick, easy money.
Upstart businesses like these rarely succeed due to one simple fact: a good cleaner does not necessarily make a good cleaning business owner.
Folks who are passionate about cleaning are willing to put in the long hours and do the hard work required to make owning a new business an exciting venture. They see that planning to reach their goals, taking action through research, learning about ownership, and building positive client relationships will serve their business for years to come. While it is true that anyone can clean, it takes a focused entrepreneur to start and grow a financially successful business.
Whether residential, commercial, carpet/upholstery, or a specialty/niche area, owning a profitable cleaning business comes with its own struggles and rewards. While you will spend a fair deal of time detailing the what,
16
How to Open & Operate a Financially Successful Cleaning Service when, how, and why of what you want your business to accomplish, you will have the satisfaction of seeing your clients homes — and possibly lives
— changed for the better as a result of your services. Starting a cleaning business from scratch is a bit intimidating if you have minimal background knowledge, but nothing is more gratifying than a referral call from a new client who heard about your services from a friend of theirs who was thrilled with your work.
If you are new to the cleaning industry, have done a bit of reading, or have just started a cleaning business and are looking to expand your knowledge
— this book holds a wealth of information for building, enhancing, and strengthening your company:
9
Traits of successful cleaning business owners
9
Types of cleaning businesses
9
Types of cleaning services
9
Getting your business started
9
Creating your business plan
9
Creating your financial plan
9
Startup capital, taxes, insurance
9
Location strategies
9
Organizing your office
9
Recruiting, interviewing, hiring, and training employees 9
Marketing, advertising, and customer-building
Introduction
17
9
Setting your fees to grow your company
9
Cleaning techniques
9
Interviews and insight from successful cleaning business owners 9
Worksheets and samples to guide you through
From start to finish, all the details, insight, and business knowledge you need to get your company off the ground and build it into a success is packed in these pages. Beginning your venture with a foundation of knowledge, a desire to provide high quality service for a fair and reasonable price, and well-thought plans for growth are the first steps in creating a cleaning business that will stand the test of time.
18
How to Open & Operate a Financially Successful Cleaning Service
1
Before You Begin
Maybe you first dreamed of owning your own business after a bad experience with an inconsiderate boss during your teenage years. Perhaps you enjoy managing others and the satisfaction of a job well done. Or maybe you find the challenge of creating a new business to meet customer needs an exciting prospect.
Whatever route you took through your life’s journey to arrive here with an interest in establishing your own cleaning business, you have come to the right place. Full of opportunity, possibility, and potential, the cleaning industry is a profitable and exciting place to be.
From monthly house cleaning to daily office cleaning, the demand for quality, detail-oriented service providers outpaces availability. The range of reasons that bring new clients to the cleaning industry is consistently growing, and with it, the need for solid, reliable service at a reasonable and fair price. Consider the possible clients in these situations: 9 A working couple with two young children who want to spend more time with their growing family than vacuuming and making sure the floors are spotless
9 Baby boomers
20
How to Open & Operate a Financially Successful Cleaning Service 9
Aging people with reduced time, energy, or strength
9
Free-time seekers
9
Empty nesters interested in downsizing to smaller or single-level homes
9
Janitorial staff that needs a helping hand
9
Customers who want a thorough spring cleaning following the winter months
9
A single person seeking a way to spend more time on a hobby or volunteer work
These potential customers provide a tiny representation of the variety of people in today’s society who consider cleaning services an important part of their lives. Gone are the days of people viewing cleaning services from the traditional standpoint of being a luxury available only to the affluent.
Whether a simple straightening and dusting or thorough office cleaning, modern cleaning services are becoming a way of life for more people.
Common considerations steering new customers in the direction of hiring a cleaning service for their daily tasks include:
9
Time saved
9
Attention to detail
9
Dislike of the tasks
9
Affordability
9
More leisure time
Chapter 1: Before You Begin
21
9
Lifestyle changes (becoming sole caregivers of parents, late work hours)
9
Dissatisfaction with current situation/help
These are the types of potential customers and the reasons they are hoping to find someone willing to give them the personalized, custom cleaning service they seek. You could be the person who can bring these customers what they are looking for in a cleaning service.
What Can You Expect?
Being your own boss, setting your own hours, being one of the major recipients of the profits of your business, and the prestige of being an entrepreneur and successful business owner are good reasons that may be driving you toward beginning your own business. Before we get too carried away with the fantasies, however, let us ground ourselves in something more specific: the daily reality of owning a cleaning business.
Setting the foundation for a cleaning business begins with weeks or months of hard work to solidify your business plan, establish service policies and offerings, research financing options, create and refine marketing strategies, develop hiring procedures, and familiarize yourself with all the legal aspects an entrepreneur needs to consider before opening for business. When faced with the reality of so many tasks to complete before you can even consider signing your first client, it is easy to become discouraged and overwhelmed.
You might even consider giving up your dream at this point, but do not throw in the towel just yet. The good news is that despite the enormous list of things to do, these tasks may only have to be completed one time.
You would not take a vacation in an unfamiliar city without having a map to guide you on your adventure, and creating a business plan