Why cleaning companies fail (and how to avoid being one of them)…

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by Tom Watson on December 7, 2014

I’m a big fan of keeping the conversation positive around here, but from time to time we have to dip into unpleasant topics.

So today we’re going to chat about a few of the main reasons why cleaning companies fail. But to put a positive spin on it, if you avoid these pitfalls you’ll be just fine.

Why cleaning companies fail

Not enough “push” from day one  – What is “push” you ask? That’s my slang for MARKETING EFFORT. When you are just starting a business you need to create momentum, and the only way to do that is by working every single day to spread the word you own a cleaning business.

This effort includes direct mail, marketing to realtors, handing out goodie bags and creating flyers that will ultimately get distributed to your target market to name just a few ideas. No one way is the best way, instead a collection of all those approaches working in harmony will provide the best results.

I can’t begin to tell you how many people call me and say they have a hard time getting accounts, but let’s just say it’s a lot. My first question to them is usually “what have you done marketing wise?” Many times they reply they have given out a “few dozen flyers” as if that is all you need to do to be successful.

That tiny little effort will get you nowhere! You need to distribute hundreds of flyers and or sales letters per month (400 would be a bare minimum in my opinion) to get the phone to ring regularly. The more…. THE BETTER. So even when you are sick and tired of marketing, KEEP GOING!

Poor presentation – At some point all your marketing and promotion efforts will pay off, and as a result your phone will ring with inquiries. This is where the rubber meets the road for the new business owner, and you need to focus on making a great first impression.

That great first impression is made easier by dressing well, having professional business cards available, arriving in a positive mindset and asking the right questions. Once you check those off your list you need to create a professional cleaning proposal that gives you the best chance for landing that cleaning account.

Not charging enough – While it’s great to obtain a new cleaning account, what’s really important is making sure it’s a profitable account. Far too many people short themselves by bidding the job on the low side. This leads to having a whole bunch of accounts that don’t make you any money.

As a measuring stick to go by, you should be charging somewhere between two and three times what you pay an employee. So if you pay $9.00 per hour, you should be charging the customer somewhere between $18.00 to $27.00 per hour. Lots of variables to consider, but that is a ballpark range.

Bidding too high – This is the evil twin of not charging enough, just going in the opposite direction. Bidding too high means you’ll rarely get hired. So if you are preparing a lot of bids and not getting hired, then this is one of the first places to look for problems.

As my old mentor used to say… “If you get hired after every bid you are bidding too low. If you never get hired after making a bid then you are too high. Aim for the middle”. That is advice that will never go out of style so make sure to put it to use in your bidding mind-set.

Lack of consistency – This problem rears its head after your company gets hired and starts cleaning. While it’s easy to come in and make a difference in the first week or two after getting hired, maintaining that consistency is much harder. Well… I shouldn’t say “it’s hard to do a good job” because it’s not. It’s just being disciplined enough to do a good job every time out.

The customer doesn’t “know you” – When you are “invisible”, it makes it easy for the customer to fire you. Why? Because they don’t know you, and they have no vested interest in you. To prevent this from happening you need to stay in touch as much as they will allow. Call and ask how things are going. Build that relationship! Make it strong!

Not paying attention to accounts receivables – This is just being lazy as far as I’m concerned. I know some people feel “funny” calling and asking where their check is, but that’s YOUR JOB. All you have to do is call, making sure to be very nice, and ask when you could expect to receive payment for the invoice in question. That’s it!

Poor training of staff – The initial training you give employees will set the tone for how well they will perform for you. From there you need to provide ongoing training to drive home and reinforce what they already learned. Point out what they are doing right and provide guidance on where they can make improvements. If you do that, you’ll be better than most other companies.

Took foot off gas pedal – This gas pedal I’m referring to is the marketing you do for your business. Far too many people slide into a comfort zone and stop marketing altogether. This is dangerous because even if you do a good job, you can get fired for a variety of reasons. If that happened you would be behind the eight ball so to speak and risk financial hardship as a result.

I’m sure I left some other problems off this list, but the major ones are covered in my opinion. If you think you are messing up on one or more of these issues, don’t beat yourself up over it (nobody’s perfect), just put your hardhat on and get to work at fixing it. If anyone else would like to chime in, feel free to add your comments and get the conversation started.

Like this post? Then subscribe to my RSS feed. Looking for a step by step blueprint showing you how to start your own cleaning business? Check out my Cleaning Business Training Courses. Looking for more cleaning contracts and revenue? Check out my Cleaning Flyers Value Pack. Want to learn how to make money Stripping & Waxing VCT Floors? Check out my VCT Training Course. Need a great website? Take a look at my Cleaning Business Website Packages.

{ 24 comments… read them below or add one }

1 Chris December 7, 2014 at 6:37 pm

Hi Tom, I’m guilty ! of the first one.

HAPPY HOLIDAY TO YOU AND YOUR FAMILY.

2 Tom Watson December 7, 2014 at 6:40 pm

Hi Chris! Thanks for commenting and happy holidays too!

3 Terry Clark December 7, 2014 at 10:10 pm

Whew! These are very important parts of the process to be successful. Thanks Tom!… I drove around to these business parks and gathered a business list of approx. 50, you’re right, so many opportunities! I just started calling a few to get some names for my direct mail marketing. I’ve been using the methods from your course, and this has been pretty fun and interesting so far! Excited to put this printer to use! :p

Take care!

-TC

4 Tom Watson December 7, 2014 at 10:12 pm

Hi Terry! Good luck and keep me posted.

5 Neil Miller December 9, 2014 at 1:37 pm

Hi Tom,

I have contacted you via email and you have always been kind enough to respond. This may be a little off topic so if you want to answer somewhere else that is fine.

I have the opportunity to pick up some model home cleaning jobs. Do you have any experience with that?

6 Tom Watson December 9, 2014 at 1:47 pm

Hi Neil! I never did model home specifically, but I like the idea of it. You would just bid that like anything else (how long will it take then put price to it).

I guess it’s pretty neat to begin with, so it shouldn’t take you that long huh? Have you thought about how long each would take to clean? How many different models and how often?

7 Neil Miller December 9, 2014 at 10:59 pm

I have a builder friend who builds upper end homes so they are large. It might be a nice niche to get into. I am going to give it a try.

It won’t be the consistency of office cleaning but if you can line up a couple of builders I am sure you can stay pretty busy. I’ll let you know how it goes.

Do you have any suggestions for cleaning expensive hard wood floors?

As far as vacuums I have a couple of Simplicity Series 6 that have worked well for me. So very expensive when new but I found a couple of used ones and they work great.

8 Tom Watson December 10, 2014 at 11:04 am

Sounds like a worthwhile type deal to me. As to not being regular commercial work… that’s OK. The most profitable cleaning companies are diversified. They have regular commercial accounts (daily, weekly etc…) and maybe even some house cleaning gigs.

They also have a little bit of everything in the pipeline from time to time. Stuff like some construction clean up, some odd one time type work they stumble across, a legion of Realtors that send them work, some carpet cleaning, window cleaning, VCT floor care and maybe some power washing thrown in.

9 Jim December 11, 2014 at 4:44 pm

Tom,

Great list. Marketing is the big problem for me. Driving around and looking for businesses to mail to is so time consuming. Do you know of any place to buy lists of businesses? Is there another way to generate a list potential customers to market too besides driving around?

10 Tom Watson December 22, 2014 at 11:22 am

Hi Jim! Sorry for the delay, I missed this comment somehow. I did a Google search online for specific categories. For instance I would look for a list of “Family Practice” type doctor offices online near my area, then I would mail one letter to each. I would repeat this process over and over again for different specialties. With that said… you can buy a list… just look online for “list brokers”. I used these folks a few times… http://www.infousa.com/

11 Brandon January 6, 2015 at 11:32 am

Hi Mr. Watson,

Quick question i wanted to ask you. Do you think its possible to distribute at least 400 sales letters in a 1 week span and what percentage of that 400 would you expect to receive a call back from? Thank you

12 Tom Watson January 6, 2015 at 12:04 pm

Hi Brandon!

I used to do that. Anywhere from a hundred or so up to several hundred per week. As to “response rate”, that varies. Industry averages are around 1 to 3 percent. So 400 (in a perfect world) would yield 4 to 12 inquiries. Sometimes you may mail 400 and get NO RESPONSE (that’s how the cookie crumbles some times), other times you may do much better than the average.

The KEY is to keep marketing. Over the long haul the math is in YOR FAVOR because just one job can net you hundreds per month in profit. So if you only got one job for 300 net per month, that is 3600 per year (that’s better than a wall street executive). If you landed 2 or 3 jobs… Grand Slam.

The return will be up and down from each mailing. But remember that just because you don’t get a call per say, DOES NOT mean it was a failure. MANY TIMES people “file away” those letters you mail for when THEY NEED TO MAKE A CHANGE. So don’t be discouraged!

13 Brandon January 6, 2015 at 12:42 pm

Thank you for the informative reply! Do you think its better to distribute the letters in lerson or just thru the mail? And do you think Friday’s are a good day to do in person marketing? Thank you again sir

14 Tom Watson January 6, 2015 at 12:54 pm

Hi Brandon! Mailing them is what I did, much faster PLUS it will get to intended recipient (which won’t happen all that often if you stop in because the office manger is too busy to see people who just drop in). Make sure you address them to “Office Manager”.

15 Angela Dowd January 7, 2015 at 1:28 pm

Hi Tom,
Couple questions:

Well first of all once again your absolutely amazing and this blog shines with wisdom and truth. Thank you! I dont know how you have the time to do all this. It takes some great sacrifice to put a website like this together and maintain it so beautifully like you do…

Where are you from? That helps in understanding price differential when you write blogs helping with proposals plus im down right curious lol

We live in cecil county maryland

also do you think you would ever start a forum on your website? that would be so awesome 🙂

Lastly… how about email vs direct mail I have been able to put together a nice list of companies with office managers personal emails and although I address each email with the persons name like good afternoon Mike, the body of it is the same but it sounds really personal and I get pleasant responses. .
I just started this emailing campaign but was wondering your thoughts or possible experience with it

Thanks 🙂

16 Tom Watson January 7, 2015 at 3:16 pm

Hi Angela! Thanks again for being so nice, much appreciated. To your questions… From Tabernacle, NJ (south / central part of state). I’ve been in your neck of the woods a lot in my life. We used to camp on the Northeast River for years as a child and go to the Cecil County Racetrack every now and again… small world.

A forum… I’ve given that some thought, but I would start a whole other site for that. That would be a little later down the road if I did that… lots of homework to do first. But I do appreciate the suggestion, as I want to deliver what everyone wants.

On email… never did that, but I see nothing wrong with it. In fact… it’s a very good idea (nothing to lose really). Try and test it out. Use different subject lines, different body copy and measure the results. Just only make one change at a time, so you can effectively measure only one variable. If you go full speed ahead on that, let me know your results, as that would be a great post down the road (on whether it’s worth pursuing or not).

17 Jonell Pitts January 14, 2015 at 12:01 am

Hi Tom and fellow cleaners!
I have been super lucky and successful with obtaining ALL of my buisness for residential home cleaning, via my free facebook page! Many word of mouth clients called from those I met on facebook.
I placed 2 ads in pennysaver, a year ago, $144- and got not ONE call or inquiry. I am an active member in a large group of over 2000 local area moms and this has helped tremendously!

18 Tom Watson January 14, 2015 at 11:09 am

Hi Jonell! WOW… THANKS for sharing that. It’s a great example of combining the power of networking (with the perfect group I must say) with social media. Great job!

19 EVA February 6, 2015 at 4:19 pm

Hi Tom
we have a residential cleaning in London
everything is going alright, but i am finding it very difficult with hiring employees.
As soon as they find something better , they terminate the contract and job even without notice at all.
I really need the advice about staff hiring. Have read the article about hiring personnel from your website, but still find it difficult
Thanks in advance for your time and effort

20 Tom Watson February 8, 2015 at 8:31 am

Hi Eva! It’s going to be a tough road to travel no matter how informed you are. Things got much better for me when I started to only hire part-timers BUT it still had the same issues in many way. Every business has this issue, so we’re not unique. I would pay CLOSE ATTENTION to the workers “previous work history” before hiring them. Eliminate candidates that have skipped from one job to another too often, as that is a clear sign that they will do the same to you.

21 Glenda Dean February 12, 2015 at 1:10 pm

Hi Tom. Just a thought about obtaining a list business’s to do marketing mailing. The local Chamber of Commerce should have a member directory. There you will find the different business’s listed, from Accounting, Wigs and Zoo’s. Most are reputable. All the information listed here on your site has been very helpful. Thank you. 🙂

22 Tom Watson February 12, 2015 at 1:43 pm

Hi Glenda! YES… great point. That’s a nice benefit to being a member. I’ve used them myself a few times.

23 Kay Richardson February 13, 2015 at 4:28 pm

Hi Tom,
just wanted to suggest on a question brought to you around the end of December of 2014. Someone said they tried calling their clientel to make sure everything was good.
I actually leave a “check sheet” at the end of every month with an office manager. This gives them an opportunity to check everything out and get in-put from the office staff.

Thanks,
Kay Richardson

24 Tom Watson February 13, 2015 at 8:19 pm

Hi Kay! LOVE that idea. It keeps everyone in touch just enough to stay on top of things without being overbearing. Thanks for sharing that.

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