As a residential cleaner, commercial cleaning can look pretty attractive: Relatively few clients paying significantly more money for less complicated work. While that may be true in some cases, and commercial cleaning can certainly be lucrative, it’s not quite as simple as it might seem, and making the transition from residential to commercial cleaning can be difficult. Here are a few key considerations if you are thinking about making the transition.
Where possible, pursue spaces you can service using your existing equipment when you are starting out. Truck mounted systems, for example, are great for residential cleaning but might not work well for large office buildings or high-rise apartments. However, truck mounts do typically work well for smaller commercial buildings like those that typically house small business office space or medical clinics.
Shift Your Advertising and Sales Tactics.
The way that you reach homeowners is not the same way you reach commercial property managers. Advertising in trade publications, on or offline, can help get your name out there. It’s probably a good idea to contact your residential customers to let them know that you also handle commercial spaces. Some of them may be involved in property management. But more than anything, you will need to get out and meet people at industry events. The commercial cleaning business, as with many B2B markets, is about connections. In addition, there are a lot more residences out there than commercial spaces, so competition for those contracts tends to be high.
Branding for Commercial
The name of your company may be a potential issue if you are going to start approaching commercial clientele. “AAA Home Cleaners” or “Magical Maids” isn’t going to sell well with a commercial office. You just won’t sound like the type of company or service they are looking for. You may need to either change your name to something that will work for both types of business, or start an entirely new company to handle the commercial side.
Obtaining Government Contracts
Another potential avenue for picking up commercial-type contracts is going the government route. Cities, towns, and states generally make their work requests public, and solicit bids from any companies who qualify. Be forewarned however, government contract bids are a lot of work and cleaning contractors often comment that it is easy to lose money if you you don’t take the time to understand the specifics of the bid request.
Accommodating the Client
One big change you will need to prepare for is that the majority of commercial cleaning is done during the off-hours when commercial facilities are largely empty rather than during the day like residential cleaning. If you employ a cleaning crew, you will probably have to recruit new workers and support staff that are willing to work evenings, nights, and weekends. This may be more difficult than hiring workers for day shifts because not as many people are willing to work nights. You will also have to be on call, or find someone who will take that role, in case problems arise on one of you properties (an overflowing toilet causing flooding, for example).
The actual work involved with commercial cleaning is a bit different than residential, so you will also need to train your staff to adjust. Commercial jobs are typically less detailed than residential, and need to be completed faster. You need to cover large areas quickly and focus on completing the cleaning specifications for that particular building rather than all the little details involved with cleaning someone’s personal space (like putting the pillows back in the right spot). As a result of that difference, production rates for commercial cleaning tend to be much higher than residential. While residential cleaners might cover 700-1000 sq. ft. per hour, commercial cleaners should be covering 2500 to 4000 sq. ft. per hour or more. You will need to factor that into your bids.
Adjusting Your Business
Cash flow is going to be different in a commercial business as well. Residential clients generally pay you on the spot for service completed that day. Commercial clients will have payment terms included in the contract which will involve sending a monthly invoice and then receiving funds after the fact (typically somewhere between 30 to 60 days). Your staff, however, will continue to expect payments on the same weekly or bi-weekly schedule, which means you will need to maintain a larger buffer to handle payroll and other expenses between payments. Some cleaning companies will invoice clients at the beginning of the month, before services have been completed, to help reduce this difficulty.
A related factor to consider is that your pricing and profit margins are going to be different. Large clients expect, essentially, to get a volume discount – so your margins will go lower as facilities get larger. Your supply, chemical, and equipment costs will also go up. On top of that, your cost for liability insurance will be significantly higher to cover the higher value of commercial buildings compared to homes. On the upside, a few larger clients can be easier to manage than many smaller clients, client turnover is generally lower, and lower margins can be made up in volume. Be aware that commercial clients typically require a bid for the work, a bid walk through the building(s), and a formal contract that includes cleaning specifications, payment terms, etc., so pricing commercial work will take more time than residential.
Hopefully you now have a better idea of the differences between commercial and residential cleaning so you can better anticipate the challenges that you will encounter should you choose to diversify. From here you can start looking at the pros and cons of the commercial option, working towards a more detailed business plan and securing the capital you will need to make it a reality.