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You don’t always get fired in the cleaning business. Sometimes your customer goes out of business.

October 12, 2014 by Tom Watson

The businesses you clean for will have their good times and their bad times. When times are good they spend freely, hire new workers and expand operations.

When good times turn bad they do the opposite. They restrict spending, layoff people and go back to focusing on their core products or services. I’ve seen it happen over and over again to many different companies.

The reason I bring this up today is for two reasons. The first reason is because I have a customer that is going through this process right now. I believe they are going out of business, so it’s kind of been on my mind lately.

And the second reason is because I wanted to share with you the warning signs that almost always appear before a customer goes out of business, so that you won’t be caught off guard. It will happen at some point in your career, so you might as well be well informed.

When you are new, it can be easy to be blind to what you see at an account you are cleaning. You just show up and clean, not really paying attention to all the warning signs that are present. Then all of a sudden you get a notice saying you aren’t needed anymore.

This brings up worries about getting paid for what you’ve done plus worrying about replacing that income somehow. That type of worry is a real downer to be sure, but it’s part of owning a cleaning business, so you need to accept it.

I’ll share some warning signs that indicate an account is not doing well below. Keep in mind that just because an account exhibits certain behaviors DOES NOT mean it will go out of business. They are just INDICATORS. So my point is don’t panic if you see them.

Cuts to the cleaning budget – Sometimes a customer may want to reduce the monthly fee. Other times they may wish to reduce the frequency of the cleaning, cutting you back from five days to three or something similar. Less “extras” like window cleaning, floor care and carpet cleaning expenditures are also a sign.

Layoffs – This is always a pretty good sign that business has slowed. You’ll be able to spot this pretty quickly when it happens because the staff will be talking about it plus you’ll notice less trash and empty desks.

Their invoices start becoming overdue – This can be a sign of financial distress of some kind or another. This can be spotted pretty easily be checking your financial reports. When a customer that has always paid early now starts paying late it raises red flags to me. You need to be careful here to not let them fall too far behind. You are NOT a bank out to lend money!

The office environment becomes toxic – I’ve seen offices where everyone just LOVED their job turn into offices where everyone seemed to HATE their job. This can happen when the staff knows for themselves the handwriting is on the wall.

Nobody works late anymore – This can be a sign of no more overtime. When times are good managers tend to let people work extra hours to tie up loose ends. When good times go south this is one perk that goes away quickly. This can be the very first indicator in some cases of a downturn in the companies financial situation.

I’ll wrap this up by reminding you not to panic over seeing one or more of these warning signs. They are not 100% accurate! All you can do is just be prepared the best you can. With that said, I would keep en eye on making sure you get paid though! Don’t let accounts get too far behind, or you may risk not getting paid at all if the company goes belly-up.

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.

Filed Under: Experienced Tagged With: account going under, account warning signs, out of business

Reader Interactions

Comments

  1. Arlene Smith says

    October 12, 2014 at 6:22 pm

    Hi Tom,
    Sure this could be true if a companies business slows down then business for us cleaners might slow down too. What about the Holidays? I always assumed that the holidays would be my busiest time for business but it’s not in fact business in my area around the holiday slows down for me and after seems to pick back up again, especially around the end of summer when kids start back into school the phone calls are constantly coming in. Why do you think this is? Any thoughts?

    Arlene Smith,
    Redlands Cleaning

  2. Tom Watson says

    October 12, 2014 at 6:29 pm

    Hi Arlene! I think people are preoccupied with the holiday season in general (parties / shopping) and that helps to make it slow. Plus people are just saturated with all types of marketing (catalogs, special sales, holiday email offers from retailers) and this dilutes any marketing we do as a business. Summer is slow because of the nice weather and vacations in my opinion. Spring and fall tends to be making money seasons.

  3. Pauline T Ila says

    October 16, 2014 at 2:30 am

    Hi Tom,
    I am very much interested in all the emails information you send. The only thing i am waiting is for some extra cash to purchase these cleaning books. Keep it up.

    cheers,
    Pauline

  4. Tom Watson says

    October 23, 2014 at 2:37 pm

    Hi Pauline! Thanks!

  5. catherine Ndiritu says

    October 26, 2014 at 8:34 am

    Am very excited reading your articles written by a cleaner so to speak. Am in expansion and scared of not being able to handle albeit all the excitement.

  6. Tom Watson says

    October 26, 2014 at 9:26 am

    Hi Catherine! Thanks for the kind words, I appreciate it. When expanding… make sure you hire one more than you think you need. This way you have COMPITITION for who is best, then just keep the top worker (and let the other one go if they are substandard) and keep repeating the process.

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