Here is how to start a cleaning business from scratch, evaluating the prospects and challenges of this venture.
Cleaning on a commercial scale has become a major business enterprise that you should consider. There are major cleaning companies today which started small. This shows a clear potential for growth.
It’s safe to assume that by reading this, you are interested in starting one.
How to Start a Commercial Cleaning Business From Scratch
However, setting up such requires the right knowledge of what’s required. Hence we’ve written this with the sole purpose of helping you with the information you need.
Owning a Cleaning Business: Pros and Cons
Before starting a commercial cleaning business, entrepreneurs need to know how viable such a business is.
There are different opportunities in the cleaning industry and each one comes with its risks. Here are some popular examples:
- House Cleaning
- Office Cleaning
- Window Cleaning
- Carpet Cleaning
- Dry Cleaning
- Foreclosure Cleaning
- General Residential Cleaning
Challenges also need to be identified. Well, there has been consistent growth in the industry over the years. As such, in setting up a cleaning business, some of the most identifiable traits of the business include;
This is an industry that has thrived in difficult times such as during periods of recession. This is because as long as buildings and offices are used, there’s a constant need for cleanup.
- Profit Potential
One of the first things to consider when starting a commercial cleaning business is to consider your earning potential. This determines the viability of such a business. Hence the more attractive the profit margin, the better your chances of success.
- No Specialized Training is Needed
In owning a cleaning business, no specialized training is needed. In addition to that, it can be started on a part-time basis. This is good news as you can keep your job until your business grows to the point where more of your attention is required. Due to this fact, anyone can open a cleaning business as long as they have a passion for it.
- Minimal Capital
Cleaning businesses require little capital depending on the niche. As such, it becomes easier for you to set up your own commercial cleaning business. The best part is despite the variation in setup cost, it is highly profitable.
This is certainly music to the ears of entrepreneurs.
- A Growing Demand
As the demand for cleaning services rises, huge opportunities are presented for entrepreneurs willing to take advantage of such. If you’ve contemplated
Despite the prospects inherent in starting a commercial cleaning business, challenges aren’t absent either. This section will focus on some of the most common challenges you’re likely to face when running a cleaning business.
- Benefits and Wages
There has been a growing demand for raising the minimum wage. Although this is meant to enhance workers’ welfare, it also impacts on pricing as well as on income margin. This is a factor you’re likely to deal with.
- Getting a Consistent Flow of Cleaning Jobs and Contracts
During the process of development, you need a consistent flow of cleaning jobs. However, attaining such targets may be quite daunting. This is due in large part to the changing nature of marketing strategies. Most clients will rather search online for cleaning companies.
As such, this presents enormous income potential for any cleaning business. With an effective and vigorous online marketing campaign, you can attract a consistent flow of cleaning jobs.
Whether you like it or not, the competition will always exist. However, how well you handle it will determine how successful your cleaning business is. Thus, the best way to thrive is by identifying your unique selling points USPs.
This enables you to avoid the all too common mistake of joining the bandwagon of ineffective cleaning start-ups.
- Managing a Workforce
This is a common challenge most commercial cleaning businesses have to deal with. In managing a workforce, there needs to be a driver as well as reward systems or incentives that motivate.
In other words, workers are more effective when there’s a reason to perform above average. Hence if you’re able to utilize their strengths, the sky will be your limit.
Starting a Cleaning Business Checklist
Today, people seem to be leaving the corporate world in droves to start their own companies.
While there is no shortage of business start-up ideas, one popular business to start is a commercial or residential cleaning business.
Following the Right Plan of Action When Starting a Cleaning Business
These companies can be started relatively quickly and without a lot of start-up capital required.
For those who are considering a cleaning business, there are several different options. One way is to purchase a cleaning franchise.
With this option, a great deal of training and support is provided, along with a checklist for starting a business in a particular manner in which the franchise operates.
The other way to begin a cleaning business is to start a company from scratch. Although this may require a great deal of work upfront, it also allows for more control of the business, along with a greater share of the profits once the company gets up and running.
Either option has its advantages and its drawbacks, depending upon the personal preference of the individual.
Starting a Cleaning Business Step-By-Step
In getting your cleaning business up and running, several essential items must be taken care of before securing your first customer.
To ensure that you complete all of the necessary tasks, having a business start-up checklist can be helpful. The items on that list should include the following:
Complete your cleaning business plan. Your cleaning company business plan is essentially your blueprint for success. This detailed plan will outline all of the procedures that you plan to undertake for achieving your company’s goals. It should also include your company’s financial information such as your cash flow and income statements.
This will be especially important if you will require any type of financing, as a lender will need to review your cleaning service business plan before offering you approval for a loan.
Set up a business bank account. You will also need to set up a bank account for your cleaning business. This should be a separate account from that of your savings or checking account.
Obtain business licenses and/or permits. If you require any type of business license or permits, you will need to acquire those before opening your company to customers. Your local Chamber of Commerce can assist you with which permits and licenses you to need, as well as with where they can be obtained.
Securing your cleaning business insurance policies. Likely, your cleaning business will also require you to purchase a liability insurance policy. This is especially the case if you will have employees working for you, as they run the risk of becoming injured on the job.
You will also need to inquire about purchasing workers’ compensation insurance.
Hire an accountant or CPA. You may need to hire an accountant or a CPA. Although your cleaning business will likely start small, business taxes are different from those of personal tax returns. Therefore, you may require the assistance of a tax professional in handling your tax returns for your company going forward.
Have an attorney on retainer. Although you may not plan on getting into legal trouble, it is always wise to have an attorney on retainer. In today’s lawsuit-happy society, most businesses should at least be affiliated with a legal professional with whom they can inquire about various issues.
Market and advertise your company. Certainly, no matter how great your services are, your company won’t make any money without any customers. Therefore, you will need to market your services. There are numerous ways to do this, including radio, television, and newspaper ads, mailers and coupons, and online promotions.
Flyers also work very well when promoting this type of business. Oftentimes, posting a flyer in a well-trafficked area such as a popular grocer will catch the eye of many potential customers.
Likewise, by going door to door and hanging flyers on businesses or residences, you are likely to generate calls from potential customers within a relatively short period.
Also, most businesses today have their web presence. Therefore, it is a given that you should have a company website where you can provide more details regarding the services that your cleaning company provides, as well as your rates and contact information.
Overall, you can typically get your cleaning business up and in full operation within just a couple of weeks.
This means that you can be seeing income within a short period as well. Because these types of businesses usually require very little initial capital outlay, you should be operating in the profit zone quite quickly.
Starting a Cleaning Business from Scratch
To realize your goal of starting a cleaning agency, you need to follow some laid down guidelines.
We have also prepared a list of steps you shouldn’t overlook during any form of cleaning.
Set up a Business Structure
This is a basic requirement for every business. By ‘structure,’ we simply mean taking care of the legal requirements. Such include;
i. Develop a Business Plan
Without a plan, your business is at best static. It’s therefore important that you give this step all the attention it deserves.
A cleaning business plan enables you to strategize for your venture.
ii. Form a Legal Entity
Knowing how to manage a cleaning business successfully involves this step. This has become a necessity to protect yourself from liability. It is common for cleaning businesses to get sued. As such, the form of legal entity you adopt will determine how your assets are distinguished from those of the business.
You can also go through this list of names that make your cleaning brand stand out.
iii. Tax Registration
Before you open your doors for business, it’s expected that you register your commercial cleaning business. This is done for purposes of taxation. However, you need to find out if you qualify for both federal and state taxes.
iv. Open an Account
For financial transactions to be possible, you need a business account. In addition to making this aspect of your operations possible, it also creates a positive impression on your clientele. In other words, it makes it more professional.
v. Keep a Detailed Record of Cashflow
Is this necessary at all? It is highly recommended. This is because finances play a critical role in determining how profitable your cleaning business is. Hence, you must keep track of all expenses as well as income.
vi. Apply for Licenses and Permits
If you wish to stay out of trouble, it’s necessary to apply for licenses and permits for your cleaning business. This is because your business may attract huge fines or may even be shut down outright. To avoid any of the above sanctions, you should do things properly.
vii. Apply for an Insurance
Clients feel more comfortable dealing with cleaning companies with an insurance policy. This is rightly so due to damages or accidents that may result. Without one, your business won’t be taken seriously.
viii. Online Presence
The webspace is where people go to look for any type of information. As such it will only be wise that you leverage in this area. By creating a user-friendly cleaning website, people can easily search and interact with your business online.
Leverage on your Resources
This may seem obvious but is highly critical to your success. It is assumed that you’ve had prior experience in the industry. As such to make your cleaning business more viable, it’s necessary to take advantage of contacts and resources available to you. The point is to use every information available to promote or enhance your competitiveness.
Be Receptive to New Information
Information is everything in the commercial cleaning industry. Because of this, you need to be highly receptive to new information and innovations. Such information may affect different aspects of your operations. The point here is to use such information to your advantage.
Systems are structures that promote the seamless functionality of your commercial cleaning business. This requires all departments in the business to function as a unit. With such an arrangement, your cleaning business will function at full capacity even in your absence. It helps to simplify the work process.
Before anyone patronizes your cleaning business, they need to know if your rates are pocket-friendly.
However, the prices of house cleaning companies are influenced by several factors. These include time, expenses on cleaning products and equipment, transport, etc.
As a result, you need to factor all of these when determining your rates. While doing so, you also need to consider the competitiveness of your rates.
How? By comparison with what’s obtainable in the industry.
Seek Legal Advice
Legal services are prerequisites for starting a cleaning business. This is because it guides you from making costly mistakes that may hurt the business in the future. Such relationships are continuous and necessary for smooth operations.
Have a Cleaning Marketing Plan
To promote your commercial cleaning business, a plan is required. Such a marketing plan should be carefully put together to ensure it has a real impact on your business.
To start on the right footing, it’s best to consult marketing experts. These would recommend the most effective strategies to adopt.
Identify your Target Market
When setting up your cleaning business, there’s usually a focus or target market you wish to woo. Therefore you need to identify this market and strategize on how best to attract customers to your cleaning company.
The first step is identifying the target market. Anything after that involves passing the right message across. Such may include hospitals, malls, households, schools, offices, etc.
Purchasing the Right Cleaning Equipment
This is a step you can’t escape from. The only exception is when you have such already. There is a wide range of supplies for a cleaning venture. These require working out or finding what such equipment is.
However, these all depend on the availability of funds. It’s expected that you’d have worked out the financial implications in your plan.
What Equipment Will You Need?
Before getting started, you will also need to obtain some necessary cleaning equipment. At the very minimum, you should have the following items:
- A commercial-grade vacuum cleaner with attachments
- Floor buffer
- Wet floor signs
- Dustpan and brush
- Toilet brush
- Paper towels
- Extension cord
- Furniture polish
- Cleaning products
- Garbage bags
- Rubber gloves
Also, you should obtain a good cart or other types of similar vehicles to move all of your equipment and supplies around in.
This will make it easier for you to get through the larger office buildings and establishments. Most, if not all, of these items, can be purchased at a local janitorial supply store.
Should You Buy a Franchise or Start Your Own Company?
One of the biggest factors you will need to determine when considering how to start a cleaning business is whether to start your business from scratch or to purchase an already established business through a franchise.
Although there are both advantages and drawbacks to going with the franchise model, some of the biggest advantages of doing so can include:
In a way, a franchise is like having an instant business.
This is because much of the initial work has already been done for you.
For example, the franchisor has taken care of putting together the business model so that you can simply follow their steps to getting the business up and running quickly.
In many aspects, running a franchise can be like following pre-written instructions.
Brand / Company Awareness
One of the biggest benefits of buying into a cleaning franchise is the instant brand awareness that your business will have.
This is especially the case with some of the bigger, more well-known companies.
In this case, you will not need to work nearly as hard in selling customers on your brand as you would with a lesser-known name or brand new, solely-owned company.
Marketing and Promotion
Going hand-in-hand with brand awareness is marketing and promotion.
This, too, will be much easier if you decide to buy into a big name franchise because, in many instances, the company will assist you with marketing.
Also, some companies even promote via large national advertising campaigns. This can trickle down to bringing customers in the doors of their local locations.
Training and Support
Franchises are also known for the vast training and support that they offer to their franchisees.
The training that is provided is oftentimes one of the biggest reasons for opting to buy into a franchise.
Franchisors will typically offer initial training before getting your company up and running.
They will usually also provide ongoing support to you – and to your employees, if applicable – should you ever have any questions or concerns.
Although there are several great advantages to working with a franchise, there are some aspects of this model that some people feel are drawbacks. These can include the following:
One of the biggest drawbacks that most people feel that a franchise presents is cost.
In most cases, franchisees must first come up with an initial down payment to buy into the franchise.
Also, there are typically ongoing fees that are required for use of the company name and/or branding.
These fees are oftentimes taken as a percentage of the franchisee’s revenue or sales performance.
Control – or lack of control – is another of the drawbacks of the franchise model.
When you own your own company, you are generally able to control every aspect of the business.
However, with a franchise, you are usually required to sign an agreement stating that you will follow their rules and operate the business in the manner that is set forth by the franchisor.
This requires that you abide by the set operating system and use their required equipment. You – and your employees, if applicable – may even be required to wear a specific uniform that is mandated by the franchisor.
While many cleaning franchises can be operated out of one’s home, some have a retail location that you operate from.
If this is the case and you buy into a franchise, you will not likely have a say in where your physical site will be.
This is because with the franchise model, the franchisor generally already has the site locations chosen.
Often, the main office of the franchisor will have a team of real estate experts that use advanced site selection techniques that are based on traffic patterns and other demographic factors to choose the best locations for their product or service.
Resale Value / Profit Sharing
If you are seeking a big payday for the sale of your business, then franchising is not likely the way to go either.
For those who own their own business – and if that company becomes highly profitable – there is a chance that you can sell that business for a tidy profit in the future.
But unfortunately, this isn’t the case with a franchise.
The good news is, however, that if your franchise location is unprofitable, the franchisor will usually step in as the buyer of last resort.
Regardless of whether you decide to go with a franchise or to start your company on your own, you can usually get your cleaning business up and operating within just a few weeks.
This means that you can also start seeing revenue within a short period too.
What to Expect When Getting Started
When you are first starting, the majority of your commercial cleaning jobs may likely be smaller.
This will help you to ease into a routine. Then, as you grow into more clients, you will also have more revenue coming in, which will allow you to purchase more equipment and supplies.
Eventually, as you begin to take on even more customers, you may find that you are not able to do all of the work yourself.
At that time, you may opt to bring on additional help.
When doing so, you will need to decide if you will hire your help as an independent contractor or as a part- or full-time company employee.
This is an area that your accountant or CPA can assist you with.
Ready to Move Forward?
In deciding when, where, and how to start a cleaning service, there are several questions that you should ask yourself to determine if this is truly the right business model for you. These questions include:
- Are you interested in potentially earning a full-time income while only working part-time hours?
- Do you want to start a business that can be up and running within just a couple of weeks?
- Are you willing to put forth a small amount (typically under $500) of capital to get started?
- Do you want to start – and grow – a new business working from your home?
- Are you willing to do the marketing and promotion that it will require to build up a client base of commercial cleaning clients?
If you answered yes to most or all of these questions, then it is likely that starting a commercial cleaning business is the right avenue for you.
Taking the Next Step
Once you know how to start a commercial cleaning business, you will be able to move forward with the process relatively quickly.
This is an industry niche that is constantly in high demand – and it can be an especially lucrative endeavor for those who take the time and effort to market their services to potential clients.
Regardless of whether you go with a franchise model or you start your commercial cleaning company on your own, it is likely that you will see great success if you decide to open a business in this exciting field.
We have seen the basic steps on how to open your own cleaning business. This has led us to discuss several steps involved. We are sure you’ll find these very helpful. With the right actions, you will be able to realize your desires.
Related Cleaning Guides:
- Buying A Cleaning Franchise – 3 Great Opportunities
- How to Obtain a Commercial Cleaning Business License
- Cleaning Services Business Plan Sample
- Sample Cleaning Business Mission Statement