How to Start a Cleaning Business from Scratch
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Things get dirty all the time, and there are many people and businesses who will pay good money to have their homes, offices, and other things cleaned.
If you’ve ever wondered how to start a cleaning business from scratch, this comprehensive guide can show you the steps you need to take to make it happen. If you’re not afraid of rolling up your sleeves and doing some work, then starting a cleaning business of your own may be your ticket to breaking free from your job and living life on your own terms as a business owner.
Why Start a Cleaning Business?
The truly great thing about this type of business is that once you establish a relationship with a potential client, you can enjoy repeat business. Some clients like to have their homes or offices cleaned once a week, bi-weekly, or monthly. If you are a one-person operation, it just takes a handful of clients giving you repeat business to earn a good income.
Another great thing about starting a cleaning business is that you can initially start with one person (yourself), and eventually hire employees to do the cleaning for you as your business grows and you take on more clients.
You don’t have to do this, of course. You can do everything yourself for as long as you want. But if you live in a populated area, then it’s definitely possible to grow your operation and have several employees.
But, first things first.
To bring in your first paycheck, you’ll need to go through some steps to establish your business and market it to attract and land paying clients.
Let’s take a look at the things you’ll need to do to start a cleaning business from scratch.
Who Will Be Your Clients?
The first thing you want to do is figure out who you are going to market your services to. While it may be tempting to say “anyone who will pay me to clean their home or business,” you may actually be better positioned for success by choosing a niche and focusing your marketing efforts. Once you are established, you can then branch out into other markets.
Most cleaning business clients can be divided into two different groups: residential and commercial. Depending on your situation, it may be easier to start cleaning houses because you can tap your existing network of friends, family, coworkers, and acquaintances to see if they need your services. You may also be able to clean small offices when you start, too.
Commercial cleaning is more difficult to break into if you are a small operation because the field is usually dominated by established companies with staffs of cleaning personnel. Due to the size of many businesses, it often takes several people cleaning at once to get the job done. Another thing to consider is a lot of commercial cleaning jobs are done at night outside of regular business hours.
Should You Buy Into a Franchise?
Another important consideration when starting your cleaning business is whether you want to purchase a cleaning franchise or remain independent. There are both pros and cons to each option.
First, with a franchise, you can benefit from having a lot of help getting your business up and running. Franchises are highly structured, and they have procedures to follow and policies to adhere to. Additionally, franchises usually offer a lot of hand-holding in the beginning to help you get started.
Another benefit of buying into a franchise is that you will be able to be part of a nationally recognized brand. Many clients like to do business with companies they know and trust. As part of a national brand, you also benefit from corporate advertising campaigns.
Franchises aren’t without their negatives though. First, buying into a franchise can be expensive, and you may have to take out a business loan to make it happen. Depending on how successful your business is, it could take you many years to repay the borrowed money.
Franchises also typically have recurring franchise fees you have to pay, which are usually a percentage of your sales. The fees are supposed to be for advertising and ongoing support.
Some franchises also require you to buy special equipment and uniforms, and they usually require you to buy this equipment from them. They may also require you to lease an office space and renovate it to company specifications. The combination of equipment, lease, and renovation can be very expensive.
Franchises are also very strict about how you run your business. As a franchisee, you will technically be part of a much larger company, and you will have little say in many of the operational decisions you make.
What if you want to do things one way but the franchise says you have to do them another way? Unfortunately, you have to adhere to the franchise’s policies and procedures. It isn’t always your call when you’re part of a franchise.
Should You Be Independent?
Operating your own independent cleaning business has its pros and cons, too. For starters, as an independent operation, you will have a great deal of freedom to run things the way you want. You will truly be your own boss and won’t have to answer to anyone – other than your clients, of course.
As an independent business owner, you can also save a lot of money by avoiding expensive franchise fees. You will still have business expenses (like cleaning supplies), but you can get started on a shoestring budget and grow from there.
A potential negative aspect of striking out on your own is that you won’t have any support from people who have been there and done that. Yes, it’s still possible to get some general support through the Small Business Administration and other organizations that assist entrepreneurs, but for the most part, you will be on your own.
Yet another potential negative of starting an independent business is that you will have to do everything yourself, especially in the beginning. You will have to do all of the cleaning, advertising, bookkeeping, and scheduling. Eventually, as your business grows, you can hire others to help you with these things, but when you are first getting started, you may have to wear a lot of different hats.
Whether you decide to purchase a franchise or strike out on your own is a personal decision you will have to make. It depends on a lot of different factors like how much you have to invest in a business, whether you want to take on a lot of debt to fund your startup, how much hand-holding you want or need, and other factors.
Naming Your Business
If you decide to start your own cleaning business and forgo buying a franchise, you will need to choose a business name for your company. This is not a decision to be taken lightly.
The name you choose will be what clients think of when they think of your company. Just like people think of McDonald’s when they think of fast food, your business name will be your brand. Because of this, you want it to be easy to remember and professional.
One strategy you could use to name your business is to combine the name of the town you live in plus the type of cleaning you do. For example, if your town is named Anderson and you specialize in cleaning houses, Anderson Residential Cleaning would be a possibility.
Another option is to use your last name as part of your company name. For example, if your last name is Baker, potential names might include Baker Professional Cleaning, Baker Cleaning Services, or Baker Residential Cleaning.
If you plan on cleaning using only environmentally friendly products, you could also create a company name that uses the word “green.” For example, Anderson Green Cleaning tells clients that you serve clients in the Anderson area and that you clean with environmentally safe products. You can really pack a lot of information in a name.
When selecting a name, it’s vitally important that you don’t copy another company’s name or name your business something that sounds similar. Your company name must be unique. If your name is similar to another company’s, you could run into legal issues.
Create a Budget
Startup costs are a part of any new business, regardless of its size. If you decide to get started as a one-person operation, your budget can be relatively small. Realistically, depending on a variety of factors, you will need a budget of $2,000-$5,000 to get your new business up and running. This assumes, of course that you are not buying into a franchise.
A few things you’ll need in your starting budget include:
- Licenses and permits: $30 – $500 (This can vary quite a bit depending on where you live and the type of business structure you choose).
- Insurance: $500 – $1,000 annually
- Cleaning equipment and supplies: $200 – $600
- Advertising: $200 – $400
Keep in mind that this represents the general amount you will need to get started. Once you are established, you can pay for additional expenses from your operational revenue.
Obtain a Business License
Before you can start offering your cleaning services and collect your first dollar, you need to make sure you are legal. And to do that, you will need to obtain a business license.
To acquire a business license, you will first need to obtain an Employer Identification Number (EIN). This is a special number the federal government issues for the purpose of reporting taxes. It’s also commonly known as a Tax Identification Number.
There is no cost to obtain an EIN, and it can be done online. After you have obtained an EIN, you can then apply for a business license. Check with your state to see where you need to go to do this or if you can do it online.
There are also some localities that may require you to obtain an additional permit before you can open your business. Be sure to check with both your state and local government to make sure you obtain all of the necessary licenses and permits.
Consult an Attorney and Accountant
Prior to starting your business, you definitely want to take the time to talk to an attorney and accountant to make sure you have all of your legal bases covered. Different states have different tax laws, and you want to make sure you have all of the necessary information to handle things correctly.
Another reason why you would want to talk to an attorney or accountant is to decide which business structure is the best for your situation. Is it best for you to operate as a sole proprietor, limited liability corporation (LLC), or a Sub-S corporation?
The business structure you choose is a very important consideration that you don’t want to get wrong. It can have important tax and liability implications. A professional can help you make the right decision.
Obtain Business Insurance
A good business liability policy is vital to protecting you from things that might happen. You definitely don’t want to start your business without obtaining coverage. Sometimes things happen, and you want to be prepared and protected against any possibility.
Be sure to shop around and get quotes from several different insurance companies before selecting a policy. It’s also important to keep in mind that there’s no such thing as having too much coverage. Yes, this is a business expense that you’ll have to pay, but it’s important protection that you can’t afford to be without.
Another type of insurance you should get is a janitorial bond. This provides protection to your client in case one of your employees steals something. Many of your clients, in fact, will expect you to be bonded and may even ask about it.
Create a Bookkeeping System
All business owners must keep detailed records of all business transactions. You will need to keep track of all of your income and expenses for tax purposes and so that you can know how much money you are making.
There are two ways you can do this. You can either use specialized bookkeeping software, like Quickbooks, or you can keep and maintain written records. If you opt for bookkeeping software, there will be a bit of a learning curve until you know how to use the system.
Wave Accounting is an option you might want to consider. It’s a free-to-use online accounting system that is packed with features. All accounting and invoicing functions are completely free, however, there is a fee if you receive payments through them or if you use their payroll services.
Another important consideration when you are starting your business is to open a business banking account. It’s always a good idea to keep your personal finances and your business finances completely separate.
Also, if bookkeeping is something that is completely new to you, resources are available to help you learn and understand it, like Bookkeeping for Dummies. A good bookkeeping system doesn’t have to be complicated.
If you have any questions about bookkeeping, consult with your CPA.
When hiring someone to clean their homes or offices, many clients like to check references. You can very easily obtain references by offering to clean the homes of friends and family for free before launching your business in exchange for them giving you permission to use them as a reference. Be sure to do an excellent job so they will be able to give you an honest recommendation.
After you have landing a few clients, you can then approach them to see if they will allow you to use them as references. The idea is to get a few starter references and then trade up when you are able to.
Purchase Cleaning Supplies
Before you can clean your first home or office, you’ll need to obtain some cleaning supplies. Just a few products you’ll need include:
- Vacuum Cleaner
- Window Cleaner
- Latex Gloves
- Scrubbing Brushes
- All-Purpose Cleaner
There may also be some additional items you can think of or prefer that you would like to add to this list.
If you are just starting out, you can obtain your cleaning products from any big box store. As your business grows, however, you might want to consider buying in bulk to get better prices. Janitorial supply companies sell cleaning supplies in bulk, and you can easily find one near you by doing an internet search.
Another thing to consider is the type of cleaning products you use. Are you going to use traditional cleaning products, or products that are safe for the environment? Environmentally safe products could be used as a selling point, and some clients may actually prefer to have their homes or offices cleaned by natural products that don’t contain chemicals.
Create a Cleaning Checklist
It’s a good idea to use a checklist when cleaning to make sure you don’t forget to take care of anything. A checklist can also be given to any employees you hire to make sure they do the job correctly.
After creating your checklist, you can hire a printing company to create notepads with the checklist on each page. In addition to listing everything that needs to be cleaned, you can also include a place to input the client’s name, address, and the date. You can then keep this document on file as a record of work completed.
What to Charge
How much should you charge for your cleaning services?
It depends. It’s kind of like asking “how long is a piece of string?” There are two ways you can charge for your cleaning services: by the hour or by the job.
If you decide to charge by the hour, you may have to check around with other cleaning services in your area to see what they charge so you can be competitive.
You don’t want to charge too little though. While it may be tempting to try to undercut your competition on price to land clients, there are some who won’t hire you if you charge too little thinking that you aren’t any good or that you are inexperienced.
If you decide to charge by the job, you could either charge by the room or by the square footage. It may even be necessary to visit a site in person before giving a quote.
Getting Your First Clients
With any service business, your first clients are going to be the hardest to land. If someone asks you how long you’ve been in business, it’s important to be honest and tell that person that your business is new. Be confident when talking to potential clients and assure them that you know what you are doing and that you can do a great job of cleaning their homes or offices. Give them references to check if they ask.
If someone gives you the opportunity to do some cleaning, knock their socks off. Do the best job you possibly can. Wow them with your best work. The quality of the work you do will be the main determining factor as to whether you are hired for retainer work.
Advertising Your Services
Making sure people know your business exists is vital to its success. In the beginning, you want to concentrate the majority of your efforts on marketing your services until you land enough clients to keep you busy. It’s important to use several marketing strategies to make sure you reach as many people as possible.
Word of Mouth
This is a very simple and effective form of marketing. You simply tell as many people as you can that you’re a business owner. Be proud of what you do. Be sure to tell all of your family, friends, and others you know in your community.
When telling people about your business, don’t be afraid to ask if they know anyone who might need your services. Many businesses have been built on referrals, and it’s a great way to generate leads.
You can also start a referral program where you offer to clean someone’s home or office for free one time for referring you to someone who becomes a client. Everyone loves getting something for free, and don’t be surprised if people take you up on this offer.
Advertise in a Local Newspaper
This is a very affordable way to advertise your services. Newspaper ads are often seen by many, especially if you live in a large community. You could pay for an ongoing weekly ad until you have an established base of clients.
Door hangers are another inexpensive form of marketing. A local printing company can design and print them for you. You can then drive around and hang them on people’s doors in residential neighborhoods.
You can hand business cards out to people as you tell them about your services. It may also be possible to make arrangements with local businesses to leave your business cards on their countertops for customers to pick up.
Having a website for your business makes you look professional. It instills confidence in those who are looking for someone to do cleaning for them. These days, building a website is very easy. Tutorials are available if you don’t know how to do it.
You can also use one of the popular website builders like Squarespace, Wix, and Weebly to create a very professional looking website. Website builders are inexpensive and very easy to use, and the low monthly fee they charge also includes your website hosting.
If you have a presence on the internet, you can also apply to have your website listed on Google Places and Bing Places. This allows you to show up on a map with a link to your website when someone does a search for cleaning services in your area.
You can design and print a simple flyer yourself and then display it at laundromats, hair dressers, restaurants, grocery stores, and other businesses that have bulletin boards.
Magnetized Vehicle Signs
Your local printing company may also be able to print large magnetized signs with your company name, phone number, and website address. This transforms your vehicle into a rolling billboard for your business. You can leave these on all the time, or you can only put them on your vehicle during business hours.
Many communities now have Facebook groups that are dedicated to buying and selling local goods and for local business advertising. You may be able to join one of these groups and advertise your services. Be sure to mention your referral program!
Growing Your Business
If you start out as a one-person operation, you may eventually get to the point where you have so much work lined up that you need to hire someone to help you.
It’s a good problem to have!
When it comes time to expand your business, you could do so by hiring one part-time person at first. You could have that person take a few of the jobs you are currently doing. If that person turns out to be a hard worker and earns your trust, you can then give her more work.
Hiring an employee frees up some of your time to concentrate on marketing your services. The more clients you land, the more help you will need. Ideally, you want to grow your business to the point where you are managing everything and your staff is doing all of the cleaning work.
When you do hire your first employee, be sure you familiarize yourself with all labor and payroll tax laws. You will also need workers compensation insurance. This is a type of insurance that protects your employees from all work-related injuries and illnesses.
After your cleaning business is established, you might want to consider offering additional cleaning services to increase revenue. Just a few possibilities include:
- Carpet Cleaning
- Window Cleaning
- Power Washing
- Rental Real Estate Cleaning
- Biohazard Cleanup
- Water Damage Cleanup and Restoration
- Event and Party Cleanup
- Post-Construction Cleanup
If you are considering adding additional services, check to see if any special training is required and if there are regulations that need to be followed.
Ready to Start Your Own Cleaning Business?
One of the truly great things about starting your own cleaning business is that you can start with a very small budget and do all of the work yourself at first. You can then slowly grow your business over time (if you want) and eventually have a staff of cleaning professionals doing all of the cleaning for you while you manage the operations of the business.
How large you grow your business is up to you. It depends on where you live (rural vs large metro area) and how much marketing you do.
Things get dirty all the time. It’s just a part of life. And there’s no reason why you can’t take advantage of it to make a good living for yourself as a cleaning business owner.