Should You Own Commercial, Residential, or BOTH Types of Cleaning Businesses?

Many cleaning business owners have intentions of running a commercial cleaning business but struggle with getting started. They find it easier to get residential cleaning clients, so in order to get some cash coming in quickly, they start out doing residential and slowly move into commercial cleaning.

If you have a cleaning business that does both commercial and residential cleaning, you've no doubt struggled with running both at the same time. After all, residential cleaning is done during the day and commercial cleaning is primarily done at night. Plus, residential cleaning is business-to-consumer, whereas commercial cleaning is business-to-business, which means your marketing efforts will not be the same, nor will your customer service issues. Not to mention you’ll have two different cleaning crews to train.

The way you receive your income is different too. One reason people like residential cleaning is because they are paid immediately, which means good cash flow for the business. Commercial cleaners must invoice their customers for a month’s worth of cleaning. The trend for invoicing has changed however, as more companies are invoicing at the beginning of the month rather than at the end. It helps the cash flow considerably, but they do not receive immediate payment the way residential cleaners do.

Residential cleaning can be somewhat more stressful in that you are dealing with homeowners, not business people, and you are cleaning where they live – their personal space. They can be much more critical of the cleaning that takes place in their home – perhaps letting you know that something is slightly out of place, or the pillows weren’t arranged properly on the couch.

The cleaning itself tends to be more detailed and your cleaning staff will be dealing with antiques and valuables that they won't typically find in commercial buildings. They can also have major obstacles like grease filled kitchens, rust stained bathroom fixtures, and pets. In addition, schedules change often without notice, lockouts occur, dogs left loose, etc.

Productivity is slower in a home than in an office, so if you cross-train employees for both jobs you may run into problems. That is because residential cleaners want to clean everything they see, whereas in commercial cleaning, some things are cleaned on a less-frequent basis.

Adding residential accounts to your commercial cleaning business (or visa-versa) can provide your company with another income stream, but it is challenging to run both at the same time. Begin by entering the market slowly and hire a separate cleaning crew for each segment. You’ll also need separate training programs and supervisors for each segment. It may not be easy, but it is possible. The key is to put good systems into place and hire the right people to help you succeed.

Do YOU do both residential and commercial cleaning? How does it work for you and what are your challenges. Post your comments by clicking on the Comments link below.

Comments

[Yalonda]

Commercial cleaning is slow for me know, so I picked up doing some residential and like you mentioned it is quick cash and you do get paid right away which is very good,on the other hand it is somewhat stressful because the home owners are not business people and they want a detailed work. I prefer commercial

[Jean Hanson]

Yalonda,
There are so many differences between residential and commercial that most companies find it easier to stick to one. That being said, I realize the you need to do what you need to do to stay in business these days. But get back to what you prefer (commercial) as soon as you can. Wishing you lots of success!

[Ron]

In my business, I concentrate on residential cleaning and nothing else. Of course, I'll clean your office if needed but none of my marketing efforts or training efforts are directed towards commercial cleaning. Think of Netflix and Blockbuster. Blockbuster rents DVD's from a retail outlet while Netflix rents DVD's from an online store. Blockbuster has almost bankrupted itself trying to play the same game as Netflix. Meanwhile, Blockbuster's retail stores have taken a severe hit because their efforts are split between online and retail. Netflix managers work on renting DVD's via the internet everyday while Blockbuster managers have to multi-task everyday.

I'd rather concentrate my entire efforts on one task or one industry. In my opinion, that gives me the best chance to succeed. But like I said, if you want me to clean your office - I'll do it!!

Two Maids & A Mop of Birmingham
http://www.twomaidsbirmingham.com

[Jean Hanson]

Hi Ron,
Good to hear from you! Looks like your business continues to expand into new areas. Congratulations!
Jean

[Pittsburgh Cleaning Service]

The majority of our business comes from residential cleaning services. However, I have slowly been building a commercial cleaning customer base over the last two years.

We have added a lot of Offices as steady customers as well as contractors that need construction cleaning services.

The nice thing about the commercial aspect is that the profit margins tend to be much higher. Unfortunately, this is mainly because the majority of commercial jobs that I get are last minute and need to be done at strange times.

It's difficult to find employees to service many of these jobs and I often find myself cleaning all night, not sleeping, then doing it all again the next day.

Also as you mentioned, I find myself financing a lot of commercial cleaning jobs and running into cash flow problems. I hope that with a little more persistence my efforts will pay off and I'll establish my commercial side of the business better, and continue to add more cleaning teams to my roster.

KD's Klean Ups
http://cleaninguppittsburgh.com/

[Jean Hanson]

KD's Klean Ups - I know you need to do what you have to do to keep the income coming in, but try to focus your marketing efforts on the type of cleaning business you really want to have. You don't want to burn yourself out!

[Billy T]

I mostly do residential cleaning for my window cleaning business in Phoenix. I would love to do more commercial here but have found it is very hard being a sole prop with no employees. Most managment companies require workmans comp. Since I won't take my self to court I wouldn't need. I will continue the effort in gaining more commercial clients this summer. With the economy being the way it is everyone is looking for a deal.

[HomeMaid]

You rightly highlight the main characteristics of commercial and residential cleaning. However omitted a key point; here in the UK if you have a commercial contract clean it can easily taken over and the staff "TUPE'd" - e.g. taken with the contract.

I've built up our domestic cleaning business over the last two years and i recognise one of the comments that you clean all day and weekends/eveings), alone, as staff have let you down.

We've always struggled with staff, but never with winning business. I've always had more than I can cope with, all driven from the web. Cash flow isnt a problem as everything is paid by card/BACS or cash.

I only take on limited amounts of retail/commercial cleaning a) because of the hours and b) waiting 30 days to be paid.

Its where you feel you are best and can afford to be in the market that should guide you and dictate your direction.

[Jed Esposito]

At Spectrum Phoenix we do only commercial work. It can be slow at times but we find it rewarding. We do quite well with staff and I think that part of the reason for that is that we stay away from domestic work. KD, I agree with Jean Hanson, do what you need to do to keep the income flowing, but build your business into what you WANT it to be.

Spectrum Building Maintenance Company
Janitorial Cleaning Services

[Tammy]

I have started my business with residential services and now would like to get into commercial. Eventually I would like to phase out of residential and just do commercial but I am having a hard time getting contracts for real commercial cleaning. I have one office I clean and there were two but the other left the building and moved to a facility where the cleaning was included in the lease. How do I go about getting to the commercial contracts. I have sent postcards to businesses and have a website.

[Jean Hanson]

Tammy - the best way to grow a commercial cleaning business is to get out there and network! Go where other business people go - it might be a Chamber event or other networking group. If you do mailings, make sure they are targeted, and that you send multiple mailings. Also make sure it's a message that gets their attention and follow up with phone calls. We offer more in-depth help at http://www.TheJanitorialStore.com

[Charles Rakita]

I work only commercial cleaning,because I still work a full time job.We do some residential,mostly windows and one time cleaning.Commercial is slow right now but we do have some contract cleaning that keeps the money coming.

[Kelly]

I am in a battle with myself about this constantly at the moment...I run a residential cleaning business and have a few commercial clients that I have picked up through default of my domestic clients.

In my business plan I had always intended to market to the commercial sectors once I had established myself and my reputation in the domestic arena and had the capital from that revenue stream to sustain the commercial side with the longer invoicing processes etc but as my business grows on the residential side I wonder if I should stick to that area, even though at times it is so challanging to deal with the business to consumer market place, and concentrate my efforts into becoming a quality domestic service of choice rather than confusing my brand and diluting myself further...however my background is in business to business selling and I am obviously interested in higher margins and a better bottom line but is it sometimes better to be the best in the field rather than a jack of all trades, for want of a better phrase?

I would love to know of people that have succesfully managed both and found it works for them as it seems that most companies will use residential cleaning as a step up (?) to commercial cleaning...thank you

[Jean Hanson]

Kelly,

There are actually not a lot of cleaning companies who do both and do it successfully. Usually one or the other is the more dominant part of the business.

That being said, it can be done. The key will be to have basically two separate staffs running each segment of the business. There are big differences between running residential vs commercial. So what I would do if I were you is make sure you have good management in place for your residential business first. The goal is to free up more of your time so you can start concentrating on the commercial cleaning side of the business. It will be a difficult juggling act for you, but it can be done!