Starting a cleaning business can be rewarding as there’s always demand for cleaning and it’s not so expensive to get started.
But running a cleaning company isn’t easy. Cleaning jobs diverge in client needs and resources. You need to put in the hard work to provide the best services and stand out in such a large and competitive market.
In this guide, we’ll discuss practical steps on how to start a cleaning business, from understanding your market and setting up operations to managing cleaners and keeping clients.
1. Plan how you’ll fund your cleaning business
The first step in your journey to start a cleaning business is planning how you’ll fund it. Business owners often need to use personal savings to pay for initial expenses. If you need additional funds, find out about small business loans from banks or credit unions. There might also be government grants or local business development programs that support startups.
Choosing what sources to use depends on your business structure and budget. If you operate independently, the startup costs are often lower compared to when you’re a part of a franchise. Being a part of a cleaning franchise may cost a large amount initially.
Another step in planning the funding is creating a detailed budget, including initial costs such as cleaning supplies, equipment, and advertising. This will give you an overview of how much you need and help you decide whether you should get a loan or grant.
It may take some time to have a stable income and consistent cash flow in your cleaning business. So control your initial costs while ensuring quality service. As your business gets bigger, you can upgrade equipment, add more services, or negotiate better deals with suppliers.
❓ How much money do I need to start a cleaning business?
The costs to start a cleaning business depend on your location, business model, and scale of operations. Generally, a small residential cleaning business may require around $500–$2000, while a larger commercial cleaning business may require $10,000–$50,000 or more.
Here’s a rough outline of the costs you’ll need to plan for:
- License and registration: $100–500 per year.
- Insurance: $500–$4,500 per year.
- Equipment and supplies: $100–$2000
- Marketing and advertising: $100
You may spend around $800–$7000, depending on how much stuff costs in your region. If the initial cost is too high for you, buy basic equipment and supplies first. Over time, you can upgrade to modern equipment and invest more in marketing activities.
2. Choose your target market
Knowing your target market helps you plan for local demands, transportation, and services you offer. What cleaning services do the clients in the target area look for? How will you or your cleaners commute to the job sites? Can you bring certain equipment to different locations easily?
3. Determine the types of cleaning services to provide
There are various types of cleaning services you can offer, from basic house cleaning and carpet cleaning to janitorial services and specialized cleaning for healthcare facilities. When deciding which cleaning services to offer, consider your local demand and your business resources.
Find out what your target clients need. Browse the websites of competitors to see what they’re offering, so you can provide what hasn’t been offered and have a chance to stand out. Make sure your services are of the high quality that clients are willing to pay for. Maybe start by offering house cleaning for friends or family in exchange for honest feedback.
If you’ve just started a cleaning business, focus on a few core services that you can consistently deliver well. As your business grows, you can always offer more services later.
Decide on whether you want to specialize in residential or commercial cleaning, whether to go solo or start a cleaning business with other people. Working individually gives more flexibility and freedom, but you can only cater to a small number of clients and residential jobs. Working with others is more complicated, but you can take on larger projects and benefit from collaboration.
Starting with residential cleaning jobs is often more practical as commercial cleaning jobs are usually dominated by larger companies. Within residential cleaning, you can specialize in specific niches like apartments or single-family homes. Be selective if you handle jobs solo, as cleaning a large mansion alone can be difficult and time-consuming.
❓ Commercial cleaning services vs. residential cleaning services
Commercial cleaning services include cleaning large spaces like offices, schools, stores, or hospitals. You may need to invest more in specialized equipment and supplies. Your workers may need to work overnight to avoid interrupting the company in the daytime. For cleaning places that require certain expertise such as handling biohazards or sterile environments, you’ll need a well-trained team.
Residential cleaning services include cleaning homes or residential spaces. Clients often have more specific demands, so your cleaners will need attention to detail and keep track of room arrangements. They’ll need more time to clean, and therefore the rates are often higher.
4. Register your business
Registering your business includes registering a business name and your business structure.
Register a business name
Your cleaning business name should:
- Reflect the cleaning services you offer
- Unique enough to stand out and avoid legal issues
- Simple and easy to remember
Once you have the perfect name, register it with the appropriate authorities to secure your business identity.
If you haven’t decided on a name yet, consider our suggestions and tips on naming your cleaning company.
Choose a business structure
Choosing your business structure depends on various factors, from legal liability and tax implications to the level of control and costs. Here are some common business structures:
- Sole proprietorship: Suitable for one owner. You’ve got complete control over your business and are personally liable for business debts. It’s simple to set up and manage.
- Partnership: Suitable for two or more owners. Shared responsibilities and profits.
- Limited Liability Company (LLC): Provides personal liability protection. Better suited for expansion and attracting investors. Taxation and management are more flexible, but there are more paperwork and formalities.
You can also choose to open a franchise of a cleaning service chain. You’ll get the brand reputation and operational procedures, but it costs more upfront and you have less control over your business.
If your services attract recurring contracts from local businesses, be aware that the IRS requires businesses to provide a 1099 contract to individuals offering services exceeding $600 annually.
Register your business structure
The process of registering your business structure depends on where you are:
- United States: Ensure the uniqueness of your chosen name within the state, then proceed to trademark it and register the domain name. Also, consider obtaining an employment identification number (EIN) if required by your city or state.
- United Kingdom: Set up as a sole trader or business partnership, check name availability, search for a trademark, and complete the company name and business registration.
- Canada: If your business shares the same name as you, registration may not be necessary. However, for different names, register the trade name and obtain a trademark for brand protection.
- Australia: If your business isn’t your personal name, register it through the Business Registration Service, ASIC, or a private service provider.
Pro Tip: Business laws and regulations vary in different places, so you can google the laws to read more relevant information. Find out whether you’ll need to get an employment identification number (EIN). Consult with a business advisor or legal professional to help you make informed decisions based on your business needs and future plans.
5. Get a cleaning business license and cleaning business insurance
You’ll need to get a business license before starting cleaning homes. Operating without one can lead to legal troubles and hefty fines. The cost of getting a business license varies depending on your location. You’ll also need to renew it every year with a fee.
Getting insurance for your business protects your business and employees from big risks. What if there’s damage to clients’ properties and you’ll have to cover them without insurance?
There are various types of insurance to consider based on your specific needs:
- General liability insurance: Provides coverage for you and cleaners from property damage and bodily injury.
- Workers’ compensation insurance: Covers medical costs and lost wages for employees injured on the job.
- Janitorial bond: Provides coverage for you when an employee engages in theft, property damage, or dishonest activities while working on a client’s premises.
- Business owners’ policy: Combines several coverages into one package and provides protection for small and medium-sized businesses. It often includes general liability insurance, commercial property insurance, medical payments coverage, etc.
- Employment practices liability: Protects businesses against employment-related lawsuits.
- Health insurance: Provides coverage for employees’ health costs.
- Vehicle insurance: Provides coverage for company vehicles.
Explore different insurance plans available and assess various providers in your area to find the right insurance for your cleaning business.
6. Set up budget, accounting, and bookkeeping
To create a budget for different aspects of running your business, start with a detailed list of all potential expenses:
- Equipment and supplies
- Licensing, insurance, taxes, and fees
- Marketing and advertising
- Employee wages, benefits, and perks
Research and estimate the cost of the items and services. Get quotes for equipment and supplies. Factor in one-time purchases (such as equipment) and recurring costs (supplies, yearly insurance, and fees). This will help you create a realistic budget.
Stick to the budget and adjust over time as your business needs change. It’s also important to set up a contingency fund for unexpected expenses or unforeseen challenges. There might be fluctuations in demand, and you should be prepared to navigate through difficult periods.
Open a dedicated business bank account to manage cash flow separately from your personal bank account.
Keep records of income and expenses for accurate tax reporting. Depending on your location, file your business taxes with the relevant authorities:
- United States: File your business taxes with the Internal Revenue Service (IRS).
- United Kingdom: File your businesses using the Companies House website.
- Australia: File your business taxes with the Australian Taxation Office (ATO).
- Canada: File your business taxes with the Canada Revenue Agency (CRA).
7. Prepare cleaning equipment, cleaning supplies, and transportation options
To start a cleaning business, of course, you need to buy cleaning equipment and cleaning supplies. As most cleaning jobs require you to commute to specific houses or job sites, you should plan for transportation, too.
To know what to get first, you can:
- Set an affordable budget: The budget should align with your current financial ability. Keep in mind that you’ll get the most essential items first, and use profits from initial jobs to get more and better items later.
- Create a list of essential tools: List the tools, equipment, and chemicals required for each service you plan to offer.
- Estimate the number of items for each job: Determine the quantity of each item needed to avoid overstocking or running out during tasks.
- Calculate costs: Calculate the total price for an accurate budget overview.
- Prioritize purchases: Prioritize items based on importance, budget constraints, and frequency of use.
If feasible, negotiate with suppliers and explore bulk purchasing discounts to reduce costs without compromising the quality of your services.
Besides buying equipment and stocking supplies, you’ll also need to plan for maintenance and storage. How are you going to organize them for easy access? How will you maintain and service the equipment to make sure they‘re in good working order?
8. Plan how to charge for cleaning services and estimate jobs
To offer competitive pricing and give more accurate estimates, you need to understand how much clients are willing to pay and how much competitors are charging in the area.
How to price cleaning services
Decide on suitable pricing structures for your business:
- Hourly rate: Charge clients based on the number of hours spent cleaning. Suitable for jobs with varying complexity or when the scope of work is unclear.
- Flat rate: Charge a fixed fee for the entire cleaning job. Suitable for routine or standard cleaning jobs with predictable time frames.
- Room rate: Charge per room cleaned. Suitable for residential cleaning.
- Square foot rate: Charge based on the total square footage of the space. Suitable for large spaces.
- Specialty service rate: Charge a specific rate for specialized cleaning services beyond regular jobs. Suitable for jobs like carpet cleaning, deep cleaning, or unique services.
– Be open to adjusting your pricing based on the unique needs of each client.
– Consider offering bundled services or packages, such as a basic cleaning package, deep cleaning, or regular maintenance. Each package can have a different price point based on the scope of services included.
– Periodically review your pricing strategy to ensure it remains competitive and aligns with your business goals. Adjust prices as needed to accommodate changes in expenses or market trends.
How to estimate jobs accurately
To provide more accurate estimates, asses the client’s premises and factor in these aspects:
- The size of the space, level of dirt, and need for specialized cleaning
- How many hours are required to clean the space
- Labor costs
- Supplies and equipment maintenance
- Payroll expenses, overhead, and other fees
- Reasonable profit margin
- Any applicable taxes
How you present your estimates and invoices affects the professionalism and legitimacy of your business. Messy, inaccurate, and sloppy estimates can make clients question your company and services. Sloppiness could also be a reason for clients to seek discounts. So you should:
- Use a well-designed cleaning estimate template and cleaning invoice template for a polished and professional appearance.
- Use digital platforms for quotes and invoices to make it easier for both you and the clients. Clients can view and approve quotes and invoices online, as well as make online payments.
9. Market and promote your cleaning business
Once you get everything set up, it’s time to attract your first clients. In a competitive market, you need to market and promote your cleaning business to stand out. Here are some practical tips to get you started:
Spread the word about you in real life
- Get the first clients through family and friends. Offer house cleaning services to your closest people. Tell them about your cleaning business and ask them to spread the word.
- Use flyers, table tents, door hangers, and brochures to promote your business in local areas. If you have a company vehicle, you can apply decals to attract more attention.
- Partner with local businesses that could be potential partners such as real estate agents or restaurants. If you’re offering commercial cleaning services, find property managers and businesses in need of your expertise and proactively reach out to pitch your services.
Build your online presence
It’s important to build and maintain your online presence in this digital era. Digital tools can help you connect and maintain relationships with clients. Here are some tips:
- Create a business page on Facebook, Instagram, Twitter, Nextdoor, or social platforms where the local community, including your potential clients, hang out. These platforms are free and easy to set up. Share content like how-to videos, before-and-after photos, and tips to engage with people and showcase your services.
- Create a business website that lists your services and provides an easy way for people to book with you. Get a domain name that aligns with your business name.
- Set up your Google Business Profile to enhance your visibility in local search results.
- List your business in local directories and on websites that connect service providers with clients such as Thumbtack or TaskRabbit. That way potential customers can come across your business wherever they search for cleaning services.
- Ask your first clients to leave positive reviews online. Share these reviews on your social pages and website to build trust and credibility.
- Run ads using Google Local Service Ads, an effective digital advertising tool for local businesses.
Encourage clients to book again
- Offer a discounted rate for repeated clients and recurring services. Clients who book regular cleaning schedules can provide a steady income stream for your business.
- Create a referral program to incentivize your clients to book you again or recommend your services to their personal network. They’ll get discounts or gifts for referrals.
10. Manage payments and cash flow
Here are the main tips on how to best invoice cleaning jobs and manage cash flow:
- Choose a reliable invoicing system: Select a payment provider or invoicing software that suits your business needs. It should make it easy for clients to pay and help you handle quick and secure transactions.
- Offer various payment methods: Clients can pay with cash, checks, credit cards, or e-transfers. This gives everyone a more flexible and smoother transaction process.
- Use cleaning invoice templates: They should clearly outline the services provided, costs, and payment terms. Templates help create professional, consistent, and detailed invoices for your business.
- Send invoices promptly: Send them right after completing a cleaning job. Prompt invoicing minimizes the gap between service delivery and payment receipt.
- Follow up on unpaid invoices: Send polite and timely payment reminders to clients who have overdue payments.
- Prepare for late or non-payment scenarios: Expect the possibility of late or non-payments. Clearly define your policy for handling such situations, whether it involves late fees, renegotiation, or other measures to ensure fair compensation.
11. Learn best practices to manage clients and your cleaning business
Build and maintain long-term relationships with clients
Once you’ve got the first clients, it’s important to make them feel like coming back. To maintain long-term positive relationships with clients, you can:
- Use the online booking form on your website to capture details about potential clients’ cleaning needs. Ask them about specifics such as types of cleaning services they need, frequency, and space size. Create detailed quotes and follow up after sending the quotes.
- Once a client approves a quote, schedule cleaners immediately using Camelo. Send a house cleaning checklist to cleaners to ensure consistent and thorough service. Scheduling software can also record the hours worked so you can pay your cleaners accurately.
- Communicate proactively with clients: Send reminders or confirmation emails a day or two before scheduled cleanings. Post-service, follow up with clients, encourage them to book future visits, and kindly ask for reviews on platforms like Google or Yelp. Encourage feedback and consider implementing client satisfaction surveys to improve your services.
- Use Customer Relationship Management (CRM) system to store client details such as contact information, preferences, requirements, special occasions, and more. These details can help with managing appointments, follow-ups, service renewals, and even personalized greetings. Many CRM systems can also integrate with invoicing software and make billing easier.
Improve the operations of your cleaning business
Managing your cleaning business efficiently also makes operations faster and smoother, which helps keep clients. Try the tips below:
- Use cleaning business software like Camelo to schedule your cleaners and streamline your daily operations.
- Define and communicate your business policies clearly. This includes pricing structures, cancellation policies, and any other relevant terms.
- Deliver high-quality cleaning services consistently. This will help keep clients satisfied and build a positive business reputation.
- Evaluate your business and client interactions regularly to identify areas for improvement and improve your services.
12. Hire, train, and manage cleaners
Even when you start solo, there may come a time when you want to expand your business. When jobs start to pile up or there are cleaning demands from larger spaces, hiring cleaners is necessary.
- Develop a clear hiring process to attract cleaners aligned with your business values. List the qualities you expect from an employee, write compelling job descriptions, interview candidates thoroughly, and prioritize cleaners with relevant experience and a commitment to quality service.
- Train your cleaners to make sure they’re well-prepared for their job. Create handbooks and checklists to help cleaners meet your business standards.
- Monitor cleaners’ performance and give them constructive feedback. Set clear metrics to recognize and address areas for improvement.
- Make sure your employees are safe, address any concerns promptly, and offer attractive benefits or perks to retain skilled cleaners.
How to start a cleaning business FAQs
Is it worth starting a cleaning business?
Starting a cleaning business can be worth it if you’re well-prepared and have a thorough plan. Here are some things you need to consider:
- It may cost less to start a cleaning business compared to other ventures. But this also means more people can get started.
- There’s always demand for cleaning services, both residential and commercial, so you’re very likely to have a steady income and grow. However, the market can be competitive and oversaturated, so you’ll need to make your services stand out and charge clients strategically.
- It’s easier to adjust working hours and scale your business when you want. But finding reliable, adequate staff for jobs can be a challenge.
Do I need formal training to start a cleaning business?
Formal training isn’t mandatory for starting and running a cleaning business. But it’s important to have a solid understanding of cleaning techniques, safety protocols, and customer service.
Familiarize yourself with industry best practices, cleaning products and equipment, and cross-contamination prevention. Consider certifications for specialized services if you plan to offer them. Basic business skills like budgeting, marketing, and customer management are also crucial.
Should I offer specialized cleaning services?
Offering specialized services such as biohazard cleaning, eco-friendly cleaning, or hoarding cleanup can set you apart and attract clients who look for specific cleaning services that can’t be found elsewhere.
However, you’ll need to invest in specialized equipment and acquire certain expertise to take those jobs. For example, if you take cleaning jobs at medical facilities, you may need knowledge of medical cleaning protocols and Occupational Safety and Health Administration (OSHA) standards, and invest in hospital-grade disinfectants or specialized cleaning tools such as color-coded cloths.
What kind of licenses and insurance do you need for a cleaning business?
You may need a business license from your city government. Check the official government website to see how to get the license.
For a cleaning business, you need coverage from accidents, damages, and injuries that may occur during cleaning operations. There are various types of insurance you can consider, including general liability insurance, workers’ compensation insurance, janitorial bonds, etc.
Ready to start your cleaning business?
Starting a cleaning business is not just about offering a service. It requires a strategic approach, dedication, and commitment to delivering high-quality service. We hope this guide on how to start a cleaning business gives you a solid understanding of the essential steps to take.
Prioritize service quality and client satisfaction, embrace technology, and stay resilient. Best of luck on your journey to building your cleaning company!