We all start our cleaning businesses for a variety of reasons. Often, it is for a career with the ultimate goal of becoming a mostly absentee owner with passive income. Others start off just trying to supplement their household income. For some, its the entrepreneurial spirit that calls us. A few even start their business with the specific goal of one day selling it for a (hopefully) a big payday.
Regardless of why you start your cleaning business, you should build it with the mindset that one day you could sell it.
“But I have no intention of ever selling my business!” That’s OK. Building your business to sell it has little to do with actually selling it. It’s a mindset that leads to building a successful house cleaning business. It’s also the same mindset that makes becoming an absentee owner possible. The mindset informs every decision you make and helps every operational process become more efficient. And of course, efficient processes not only are easier to duplicate but will make your business more successful.
Imagine the day when your business is humming right along because your operation is efficient. From hiring and training to delivering and billing your services, you’re now managing your business rather than actually dealing with all the minutiae. Some aspects of your business will basically be on auto-pilot. You’ll be ready to shift your focus from running your business to actually growing it.
Once your procedures are in place, you’ll be able to hire someone to manage the day-to-day operations while you focus on something else. Perhaps, you want to travel the world or you simply want to spend more time ON your business rather than IN it. And, of course, should you ever decide to sell your business it will be more attractive to a potential buyer because you can demonstrate how well the business runs – even without you.
Ideally, your cleaning business will eventually run successfully regardless of whether you are in the building.
Sounds good, but where do I start?
Make decisions about your business based on the idea that you will not always be doing everything yourself.
A good starting point could be with your choice of name.
For instance, which name sounds less reliant on the owner being involved in every aspect of the operation?
Debbie’s Maid Service -or– Buckets & Bows Maid Service
When you’re first starting out, the impulse to put your name and face out front of your business can be strong. It also makes sense when you’re small and trying to establish that you’re trustworthy and serious about providing quality services. But what happens to your customer’s experience when you are no longer the only person answering the phone let alone the only person doing the cleanings?
To be clear, it is perfectly fine – and even recommendable – to include yourself in your branding especially as you’re differentiating yourself as a locally owned business and establishing your pedigree as a quality company. But be careful to project the image that your company is about more than just you. You are the most visible member of a team. A team member, that if absolutely necessary, could be replaced without your company missing a beat.
Focus on SOPs
Pardon the corporate jargon, but SOPs are a critical part of any successful business that wishes to consistently hit their growth goals. SOPs, or Standard Operating Procedures, are the best way to make your business efficient, scale-able and easier to run regardless of who is managing it. Establish SOPs for every aspect of your business from your hiring practices, training, accounting and even marketing. Whenever possible, break down the various aspects of your business into discrete modules and document the SOPs for each. Doing so allows you to more easily train different team members to manage each of the various processes. AND each process becomes less reliable on the specific individual tasked with managing it.
Keep Control of Your Finances
There is one thing that is almost universally true with all cleaning business owners: none of us got into this industry because we love things like bookkeeping, supply chains and keeping track of payroll. But we all do our best to at least become proficient in managing our finances. And it’s a good thing too!
It is obvious that if you want to sell your business, you will want to be able to show how valuable it is. But even if you never want to sell, keeping control of your finances is critical to the success of your business. We certainly don’t want to run our cleaning business as a non-profit!
Start by keeping close tabs on your supply chain. If at all possible, have multiple suppliers for everything you need so you can be sure to always get the best deal and hopefully not have issues of availability. It is also important to know what your cost of supplies is when you’re calculating your profit margins.
Payroll and Taxes
Consult with your CPA to make sure you are accounting for everything properly and paying expenses on-time. Years ago we encountered a cleaning business that thought their services were not subject to sales tax. THREE YEARS LATER when the state told them they were incorrect, the tax bill nearly put them out of business.
TRACK EVERYTHING whenever possible. Make sure you are getting an acceptable return on investment for each of your marketing campaigns. No cleaning business, regardless of size, has an unlimited marketing budget so it is critical that every dollar is working for you. And make sure you are not over-spending. It is usually best to budget 7-10% of your gross revenue for marketing and advertising.
Know your Numbers
If your accounting SOPs are all in place, then it becomes infinitely easier to keep a close eye on your critical numbers. How do you know if its time for a price increase if you don’t know your net profit margins? How do you know your net profit margins if you do not know your cost of supplies and payroll expenses? Everything is connected.
You May Never Sell Your Cleaning Business, But You’ll Enjoy Owning One That a Buyer Would Want
If your cleaning business is attractive to a prospective buyer, it means it has value. Your cleaning business is profitable and built for potential sustained success and even growth. The operation is setup to be efficient with established SOPs that can be duplicated and managed by just about anyone with a bit of training. And you’ll enjoy the freedom that only comes with being able to spend time on your business rather than being consumed by your business.
If you’re ready to take your cleaning business to the next level, we invite you to learn more about our Cleaning Business Fundamentals. Join the hundreds of professionals who have learned what it takes to become a successful – and happy – cleaning business owner.
Known as The Maid Coach, Debbie Sardone is America’s top cleaning business consultant. Debbie helps owners of residential cleaning companies build a 7-figure dream business, with a 6-figure income and the freedom in their lives that they deserve.