Small accounts add up to big bucks over time

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by Tom Watson on December 22, 2013

When people start a business they tend to have visions of landing super big accounts that “in and of themselves” make them wealthy.

While there are certainly plenty of large cleaning accounts to go after, there is nothing wrong with collecting a selection of smaller ones too.

Why you need small accounts in your portfolio

I’m a big fan of having a selection of both large and small accounts, and everything in-between as well. There’s a lot of reasons for this. The first one is large accounts tend to pay SLOW while small accounts tend to pay FAST.

By having a little bit of both in your cleaning portfolio you will probably avoid any cash flow issues when running your business. After all, if you only had BIG accounts and several paid you LATE, you would being going headfirst into a CASH-CRUNCH where money was tight. That would be NO FUN!

Another reason I like having a collection of accounts that are both large and small is because it protects you from GIANT SWINGS in your income. If you only had three big accounts and you lost one that will spell big trouble for you. You need to have a large foundation to minimize this in my opinion.

Small change adds up to BIG bucks

When I was new to the business I took whatever jobs came my way. I didn’t discriminate in any way shape or form. I still don’t, as you never know where that one tiny account may lead. Besides… all the small stuff collectively adds up to a nice pile of money over time.  Some examples are below…

Interior  Design retail store – High-end furnishings were stuffed into this tiny place from end to end making it a challenge to avoid breaking something, which we never did luckily. This account was only $260.00 per month for once per week service but the job only took two hours to clean. This worked out to $30 per hour for each visit. Yearly Income – $3,120.00

Frame and Moulding retail store – Countless frames and moldings used for framing pictures hung from the walls and displays located in the store. This twice per week account brought in just $320.00 per month but on the plus side it took but an hour (or less in most cases) to clean. This translated to $36.95 per hour worked! Yearly Income – $3,840.00

Machine Shop – Gritty industrial looking building is nothing to look at yet it’s a money-maker. Several offices, a long hallway and three small bathrooms bring in only $180.00 per month however this account is only cleaned every other week. This 1.5 hour job works out to $55.29 per hour. Yearly Income – $2,160.00

Accountants Office – Small condo style office has just three offices, one small bathroom, some cubicles and a tiny foyer. We clean it twice per week for $255.00 per month. We spend about one hour cleaning it (usually much less). This averages out to roughly $29.45 per hour worked. Yearly Income – $3,060 

Town Library – Two small buildings right on “Main Street” sit side by side. One building was all children’s material while the other side was for the adults. The account brought in only $235.00 per month for a once per week cleaning of each building. At one hour of cleaning each, this worked out to $27.14 per hour. Yearly Income – $2,820.00

As you can see from the examples above there is some decent money to be had by collecting the accounts that many larger cleaning companies simply ignored. Collectively the accounts above total $15,000. That’s not too shabby in my opinion.

The final reason why I like collecting small accounts is because the “per dollar” amount you earn for cleaning far exceeds what you would get cleaning the larger corporate accounts where the competition is fierce. This is because when you market to where the competition doesn’t go, you get more leeway on pricing.

I know many of you have probably experienced similar results, so feel free to share them in the comments below to get the conversation started about how aiming for the lesser accounts actually gets you more per hour in most cases.

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{ 16 comments… read them below or add one }

1 Brandon December 22, 2013 at 10:59 pm

Great informative post Mr. Watson! One of the key essentials to success in the commercial cleaning industry is having a collection of small and large accounts. I had to learn that the hard way… I had two somewhat large accounts my first 2 years in business (started my business in 2010), and lost both of the contracts in the same month last December in 2012. I was generating a good amount of money each month from those accounts, and got too complacent… Luckily I had a good amount of money in my cash reserves to sustain myself for awhile afterwards.. Always look to diversify your cleaning accounts yall, and be prepared for anything.

Do all retail stores seek the services of a cleaning service, and do stores inside of a Mall need cleaning services?

2 Tom Watson December 23, 2013 at 2:44 pm

Hi Brandon! We all learn the lessons the hard way, but it does drive home why it’s so important. To your question… some do and some don’t as far as retail stores needing cleaning. I should clarify that… they all need cleaning, it’s just WHO does the cleaning.

Many stores have their associates do the cleaning to save on costs. Others are forced to use whatever company the management company uses. Those that are left use private companies like ours.

So in a nutshell, you have a 2 out of 3 chance of being needed. You can’t clean for those who use their own staff but you can be the one who’s hired privately and for those who use a management company (just market to management firms).

3 Brandon December 23, 2013 at 5:08 pm

Thank you for your response! Do you utilize the direct mail method when marketing to these management firms? Do they put you on some kind of vendor list?

4 Tom Watson December 23, 2013 at 7:30 pm

Hi Brandon! Yes… direct mail package to all property management companies. Vendor list… In a way I guess they do… they try you out and if they like you they bring you back when needed. If they had a lot of work then you would get more as you become more of a trusted name.

5 Mauritz Strauss December 24, 2013 at 12:34 am

Hi Tom,always enjoy your info,started my business a year ago,and yes many teething problems,started sending proposals to estate agents and it seems to be paying off,problem is they very timely with there payments,but I do get paid.I prefer the once off cleanings no clients,nothing for the cleaners to break as all houses are empty,I want to start tendering next year,what do you think about tenders,and what should I look out for?.

Kind Regards
Mauritz

6 Tom Watson December 26, 2013 at 8:59 am

Hi Mauritz! Thanks for the kind words… We cleaned a lot of houses, maybe broke one or two things, so don’t get too worried about that. Just hire the right people, train them well and the rest will take care of itself on that.

As to “the process”… it’s not much different than any other cleaning. They are just hiring you to come out on a regular routine. With houses, it’s all about making the home owner HAPPY. When you thrill them they tell their friends, which get you free business.

7 Brandon January 15, 2014 at 7:09 pm

Hi Mr. Watson,

In regards to the accounts that takes only an hour or less to clean, do you have just one employee servicing that account, or do you have a 2 person team?

8 Tom Watson January 15, 2014 at 7:39 pm

Depends… though I generally only hire one.

9 Julius January 29, 2014 at 3:04 am

Hi Tom.Without flatreing, none of your post is irrelevant to any one growing their cleaning business. My last experience about keeping small account was some years back, when i was carrying out street to street marketing and i ran into a paint shop of about four bedrooms flat in site, after much persuation i just agreed with the client to take her offer. Then i carried otu the job successfullt though i was pained been unable to make profit, but just about 2 to 3 months latter i got a call from same client which landed me one off cleaninig job of 27 block of 2/3 bedroom flat apartment. So, what you have just share is a great tools that any body must exploy and manage well. Keep it up sir.

10 Tom Watson January 29, 2014 at 8:51 am

Hi Julius! I appreciate that and thanks for sharing that story.

11 Galol February 10, 2014 at 3:50 pm

Hi Tom. What do you think about restaurant cleaning? Do you have any experience with this sector? Lately, I’ve been seeing a lot of restaurants requesting cleaning services in my area. My cleaning company is only 3 months old, got a couple of commercial cleaning accounts, but looking to add accounts. Although I have plenty of experience with other cleaning services (window cleaning, carpet cleaning, office cleaning, post-construction cleaning, etc.), I have no experience in restaurant cleaning. What should I look out for?

12 Tom Watson February 15, 2014 at 4:09 pm

Hi Galol! There’s money to be made there in just about any niche. My experience is limited, did a lot of carpet cleaning for restaurants but not too much regular commercial cleaning. I don’t see it as being all that much different in terms of the cleaning. You just need to zero in on what the client thinks is important (virtually every single job is unique, so it’s hard to make a top ten list of what you need to do, just focus on what they want done).

13 aaron April 14, 2014 at 2:31 pm

Hey Tom, love your posts you truly are a master of this business. I have a slightly differnet situation, im not the owner of the company. The owners my friends dad and he ran a EXTREMELY successful cleaning company from 1998 up untill now, but because of the economy he has trouble getting clients thats why he hired me to get more clients because I have the skills to design a website and use social media networks. How would you recomend me going about gaining clients in the north NJ area ? Thanks Tom

14 Tom Watson April 16, 2014 at 12:55 pm

Hi Aaron! Thanks for the kind words. I’ll touch base via email!

15 Junior Joseph April 29, 2014 at 5:59 pm

Need some advice to start my cleaning business.

16 Tom Watson May 1, 2014 at 10:48 am

Hi Junior! Did you sign up for the mailing list? (it’s on the homepage).

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