Cleanliness is a basic human need. It is demanded on a daily basis by homes and neighboring communities as well as by companies, facilities and organizations of all types: the range of clients is wide. If we consider dedicating ourselves to this activity, it will be necessary to define previously what we want and we can clean up. Here you can read the keys to set up a cleaning services company. To download the complete business plan, click here.
In this sector, it is possible to differentiate between three types of cleaning services. The first is the general cleanings are punctual or sporadic, and are aimed at both private homes and businesses, commercial premises and other facilities. Also included here are the end-of-site cleanings, in depth or the cleaning of claims.
The second modality is the specific sectoral cleanings. There are demand sectors that require specific cleaning plans, with adequate materials, techniques, machinery and personnel. These peculiarities mean that in maintenance cleaning there are also several specializations, in some cases quite complex: that of industrial buildings requires cleaning of heights; in health centers hygiene procedures are very strict; in the agri-food and pharmaceutical sector the personnel must be adequately qualified; while the industrial technical cleaning and that of nuclear power plants is at the top of the pyramid of specialization.
The third type are specialized technical cleanings. The maintenance cleaning service does not cover certain elements that require specific periodic treatments, such as ceilings, upholstery, blinds or air conditioning ducts, among others. In the same way, there are special circumstances that require specific interventions, such as the removal of chewing gum, graffiti and graffiti, dressing and polishing of floors, deratization, disinsection, environmental deodorization, pottery, etc.
THE FIGURES OF THE SECTOR
Although the general cleanings can be a good way to start in this activity, the specialized technical services and the sectorial niches are a very good positioning opportunity to differentiate themselves from other companies in the sector. And they can generate an important demand, if it is possible to create an attractive, useful and differentiated offer in a traditional and mature sector.
According to the most recent data of the INE, the number of companies dedicated to cleaning activities amounts to 31,938 (1,049 more than the previous year) and employment to 3,337,646 people. In 2017, the total turnover amounted to 9,970 million dollars (1.8% more than in 2016). Although the sector is highly atomized – it is composed of 95% of micro-enterprises, from zero to ten workers – the turnover of the first 10 operators is around 20% of the total and large companies (of 250 employed or more) generate 61% of billing Large companies mainly provide services to Public Administrations, while micro-enterprises are especially active in the household market.
KEYS TO SHINE IN THE SECTOR
The experts of this market highlight the following aspects as especially relevant to succeed in it:
Management of people. They are the “soul” of the business and is a particularly critical point in a sector characterized by a high rate of absenteeism, high turnover and little attachment to the profession. Training, motivation and the remuneration system are the tools to achieve employee satisfaction and ensure their productivity. In addition to the staff of cleaners, commercial, as well as organizational, profiles can not be lacking, in order to achieve the proper planning of the work.
Professionalism and vocation of service. This aspect is vital, since cleaning services are provided on a regular basis. Sandra Moreno, Manager of Cleanings Castilla, expresses it this way: “Would you leave the keys of your house to anyone?”. The commitment to quality service and the generation of trust are the driving force of his company, which has been providing services since Azuqueca de Henares (Guadalajara) since 1992. Its policy of managing people has been key in its longevity. “Many ladies (most of their staff are female) have been with us since the beginning. Feeling valued and managing to combine your personal life have been decisive, “explains Sandra Moreno.
Machinery, techniques, treatments and modern products. Being at the forefront in this area and even innovating, as well as good purchasing management, in quantity and quality, can represent considerable cost savings and productivity increases.
Attention to the regulations. It is necessary to know and strictly comply with the current environmental, storage and handling standards for chemical products, as well as the personnel subrogation regulations, in the event that a contract changes ownership.
Communication. Gaining notoriety is essential for any business, especially in the early stages. This implies time and resources, so you have to have an adequate initial budget. It will be necessary to fine-tune a good mix of activities, both online – web, social networks, SEO, SEM – and offline, such as announcements in the media, signage and signage, commercial visits, public relations (press releases, sponsorships, networking,), etc.
THE CALCULATIONS OF OUR SUPPOSED: BALANCE OF RESULTS
The income statement records all income and expenses incurred throughout the year (excluding VAT). The main expenses incurred by a cleaning services company are:
- Personnel expenses: the sum of gross wages and social security paid by the company. It is the highest expense in this labor intensive activity and also needs to be covered punctually every month, so treasury control is especially important. The salary range stands at an average of 15,380 gross dollars per year. In our case we collect in this section the remunerations of a team of 4 cleaners, a specialized worker and the entrepreneur.
- general expenses: supplies (electricity, water, telephone, gas, Internet connection, fuel), external services (leasing – local and renting of the van), services of professionals – in our case, the agency -, maintenance costs and repairs, insurance, advertising).
- amortizations: they represent an unavoidable expense that includes the loss of value of the elements of the fixed assets. In our example they amount to a total of 4,591 dollars per year.
- financial expenses: interest on loans or bank loans
Subtracting from sales the cost of sales (or variable cost) – which does not include labor and is associated with the consumption of goods needed to perform each service (basically cleaning products) -, you get a gross margin on sales 95.5%. A value close to 100% makes it necessary to sell the equivalent of the expenses that are available, in order to reach the break-even point. As in the first year only sales of 108,500 dollars are achieved, losses of $43,392 are generated. To start giving positive results maintaining the same margins and expenses, sales should increase 43%, although this will also increase operating costs. Likewise, it will be very important to guarantee the stable income derived from the maintenance cleanings, since the general and specialized ones report more irregular income. The prices of the services vary depending on the type, the expected costs, the types of customers, the prices of the competitors and possible aspects of differentiation. In this sense, specialized technical cleanings allow higher prices and margins.