Business plan to set up a cleaning company

Entrepreneurs can do a lot of different things with companies that do outsourcing and the new way of building.

People have a basic need to be clean. Home, neighboring communities, businesses, facilities, and organizations need it daily. Unfortunately, the number of people who need it is large. If we want to spend a lot of time on this activity, we will need to decide what we want to clean and what we can clean. Here you can read the keys to setting up a cleaning service company.

Three different kinds of cleaning services can be told apart in this field. The first is regular or irregular general cleaning. They are meant for homes, businesses,

commercial premises and other facilities. This also includes end-of-work, in-depth cleaning or accident cleaning.

The second modality is the specific sectoral cleanups. Demand sectors need specific cleaning services business plan with the right tools, methods, people, and machines. Because of these differences, there are also specializations in maintenance cleaning, some of which are quite complicated. For example, cleaning industrial buildings requires cleaning at heights; in health centers, hygiene rules are very strict; and in the agri-food and pharmaceutical industries, there are a lot of rules to follow. In addition, sector staff must be adequately qualified, while industrial technical and nuclear power plant cleaning is at the top of the specialization pyramid.

The third type is specialized technical cleaning. For example, the maintenance cleaning service doesn't cover things like ceilings, upholstery, blinds, or air conditioning ducts that need to be cleaned in a certain way regularly. In the same way, certain situations call for certain actions, such as getting rid of chewing gum, graffiti, and diamonds, painting and polishing floors, rat extermination, insect removal, environmental deodorization, pocería, etc.

Industry figures

General cleaning is a good way to start this business, but specialized technical services and market niches are great ways to set yourself apart from other companies in the same field. And they can create a lot of demand if they can make an appealing, useful, and different offer in a traditional, mature market.

The most recent data from the INE (2020) shows that there are 34,649 cleaning companies, which is 1,618 more than the year before. These companies employ 3,337,646 people. In 2018, the total sales were 10.790 billion euros, 1.8% more than in 2016. Even though the sector is very fragmented—it is made up of 95% micro-enterprises with 0–10 employees—the first ten operators make up about 20% of the total turnover, and large companies with 250 or more employees make up 61%. Bill paying. Large companies mostly provide services to government agencies, while micro-enterprises focus on the market for goods and services for households. 

Keys to shine in the sector

Experts in this market highlight the following aspects as especially relevant to succeed in it:

People management. They are the "soul" of the business, 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 productivity. In addition to the cleaning staff, you cannot miss commercial and organizational profiles to achieve proper work planning.

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 regulations. It is necessary to know and strictly comply with the current environmental regulations, storage and handling of chemical products, and the regulations on subrogation of personnel if a contract changes ownership.

Communication. Getting notoriety is essential for any business, especially in the early days. This implies time and resources, so it will be necessary to have an adequate initial budget. It will be important to come up with a good mix of things to do., both online - web, social networks, SEO, SEM - and offline, such as advertisements in the media, posters and signage, business visits, public relations (press releases, sponsorships, networking), etc.

Our assumption: investment and initial balance

The income statement records all income and expenses made throughout the year (excluding VAT). The main expenses incurred by a cleaning service company are: 

·         Personnel expenses: the sum of gross salaries and social security paid by the company. It is the highest expense in this labor-intensive activity and needs to be covered punctually every month, so treasury control is especially important. The salary range stands at an average of 15,380 euros gross per year. In our assumption, we include in this section the remuneration of a team of 4 cleaners, a specialized worker and a businesswoman.

·         general expenses: supplies (electricity, water, telephone, gas, Internet connection, fuel), external services (leasing - local and renting of the van, professional services - in our case, the agency, maintenance expenses and repairs, insurance, advertising).

·         Depreciation: they represent an unavoidable expense that includes the loss of value of the fixed assets. In our example, they amount to 4,591$ per year.

·         financial expenses: interest on loans or bank credits

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