Construction clean ups are intense. There’s no other way to say that and convey what commercial cleaning companies go through. For those cleaning companies that have not yet taken on one of these projects, I encourage you to read and listen to the podcast. These projects are a potential money-maker for your company. They also come with a great deal of risk. So, consider carefully before you jump into them.

Construction Clean Up Projects CAN Build Your Business

As the commercial cleaning company owner or salesperson, part of your job is filling the pipeline. By that we mean, making contacts and providing viable opportunities for billable work now and into the future. It’s a simple explanation for a highly complex task. If this is your role you already know that. If sales or account management is NOT your role, there’s a critical piece of information before you begin. Please grasp that this part of the job is never-ending. Projects that are promised don’t arrive without staying in contact. Projects that begin will eventually come to an end and will need to be replaced with more on-going work.

Because construction clean up projects DO pay well, they offer you and your front line cleaners the chance for a project that can require multiple team members. This is outstanding for keeping your cleaners profitably engaged.

Construction Clean Up Projects CAN Ruin Your Business

As mentioned above, construction clean up projects are demanding. They require a lot of team-member-time, which is great for receivables. They also mean you’re going to be paying team members, so much of that will flow out of your company in payroll. If you’re an employee reading this, I encourage you NOT to be offended. Your boss or manager isn’t upset about paying you. Frankly, most of the cleaning company owners and managers I’ve met over the years are very thankful for the hard-working members of their teams!

What many employees (and owners) miss at first is that construction clean up projects don’t all pay when the work is done. There is a retention period that can be more than 12 months. That means up to 10% of the cleaning company billings are held until that time has passed and all parties have their lists completed. Consider that before embarking on construction clean up projects.

Construction Clean Ups Should be Handled With Care

Frankly, construction clean up projects should NOT be your first if you’re a new owner. But when you think you’re ready, start reaching out to the property developers in your area of the country. If you’d like a structured method on how to do THAT, contact me here. As a Cleaning Consultant, I help owners build their businesses the right way, every day. .

This Week’s Podcast transcript can be found below.

 

Ray

Joel?

 

Joel

Yes, Ray.

 

Ray

We’re talking construction cleanup today. I had no idea what that meant until you shared it with me several years ago. It had never occurred to me while the building is being built, renovated, and summarily partially destroyed in the process, all the crap that the cleaning crew is going to have to do between those things.

 

Joel

It depends where you come in as to what you’re going to be doing.

 

Ray

Fill me in.

 

Joel

If it’s a new build and a building is going up, you have what they call a grunt position. They’re going around and they’re picking up all of the plastic from all of the stuff that all of the tradespeople are opening up. And the cardboard boxes, and the pallets, and the wire, and they’re sweeping to try to keep the dust down. So they’re constantly doing that type of work all day, every day. They might be, towards the end of the day, having a mop areas to try to, again, get the dust to be down. But it’s not really a cleaning, other than it’s cleaning the work site. So that’s new build if you’re working on a job at that time. Insurance companies don’t like you to be involved in that process. If you are, you’re going to be paying a lot more for your insurance rates to do that work. So, you don’t want to just do one job. You want to be able to get in with the company solidly so that you can continue to do that, so you can pay for that part of the insurance writer. (Okay) Typically, what happens is you are going to go in after a building is supposed to be completely built, or refurbished or remodeled. And you’re going to do an initial construction clean.

 

Joel

So you’re going in doing all the heavy work and getting basically a building, say, 80 % to 90 % clean. Getting the heavy dirt out, all the wire nuts. Anything that gets thrown or missed during the course of a final quick broom clean.

 

Ray

So really big, heavy, coarse material.

 

Joel

Correct. But yet, you would be able to use the bathroom You’d be able to use the kitchens. Because you got to get that area up so it looks presentable for a walk through of the tenant moving in, hat it looks fairly clean. Because during this phase, you also have all the other trades doing what’s called their punch work. “Oh, there’s a hole in the wall. Oh, there’s a missing outlet. There’s a missing switch. There’s a leaky pipe. The HVAC system doesn’t have enough CFMs flowing through the vents”. So, they’re going through and doing punch work, which then has additional soils that have to be cleaned up. And then you have your final clean, which is now this is the white glove test. This is move-in ready. It looks pristine. All the floor finishes are done. Any polishing of any of the metals are done. You’ve opened up all the millwork and you’ve cleaned the insides of the millwork, cabinets, vanities, anything like that. So, it’s a very, very detailed clean. Those are the three types of construction cleaning that you may be involved in. With the first one being the most insurance-heavy of the three.

 

Joel

Okay. Working with your construction companies. You want to try to get in with a construction company that you are going to be able to continue to work with. You don’t want to be doing 20 different construction job sites with 20 different companies if you can help it. Because is construction companies are going to work with companies that work with them and work well with them and aren’t going to make excuses when things aren’t done and done right. One of the things I’ve always prided myself on with our company is, if something’s wrong, we don’t make excuses as we go fix it. Get hostile on a construction site. There’s a lot of four-letter words that get thrown out.

 

Ray

People get tired. They get course. I get it.

 

Joel

And being able to do that and yet hold your own, but don’t raise your voice and don’t have the construction contractor have to raise their voice. It goes a long way. And being able to work with a company where they even pre-bid things, and you come up with a basic price per square foot. And that’s going to vary by region in the United States; How much you have to pay your people; If it’s a union job; A non-union contract that you’re working on.

 

Joel

So, your rates are going to be a little bit different. But as long as you’re consistent and you work well with the other company. That could be a cash cow for you because there’s a lot of money to be made in that part of our industry. Because it’s really special specialized type of cleaning. It requires a lot of people, typically, particularly in larger sites, that have to do it in a very short period of time.

 

Ray

When you have told me about the timelines that these particular projects are on, I find it fairly amazing that things get done. A question for you specifically on spec’ing the job, which is part of our concern in this episode.

 

I can see how the last part of the cleanup would be most like a traditional cleaning job. All the big rough stuff has been done. A lot of what that traditional service would be, it was up and running and you were doing that. But the other two are so different. What guidance do you have for someone who maybe hasn’t done this job or really hasn’t spec’d this job?

 

Joel

There’s two ways to look at the very first type of job. You either just do a time of materials, or you say that person is going to work eight hours a day, how many do you want? These are the basic duties; Sweeping; Mopping towards the end of the day; Picking up cardboard; All of the pallets; Things like that.

 

Ray

That’s a pretty straightforward calculation.

 

Joel

It can be, yes.

 

Ray

It can be or is.

 

Joel

It can be. Because things that could be thrown in is, “Oh, now they want you to remove all the concrete.”

 

Ray

So, it sounds like what we’re talking about is writing a really-specific quote.

 

Joel

Yes. Sometimes what happens, “Oh, just I want two eight-hour people to do all the rough work during…

• “Well, what’s that rough work going to include?
• And what’s it going to exclude?
• And what is going to be additional billing?

 

That is a way to do it with that. With the rough cleaning, it’s pretty detailed in the sense that you’re working off of the blueprints and the complete specs. So if you’re working on a multistory building, typically, or like a school district, some of those are 300, 400 to 34,000 pages long, and you have to read through it to catch every little. And I’ve even worked on sites where it’s like, okay, you have to just say how many cases of product you brought on site, and then at the end, how much product you have left. Because they will subtract that off of what they owe you. So if you have three is a cleaning chemical left in a container, they want you to credit them that three ounces of product. You really have to read the RFP. That’s why if you can get into one or two construction companies and be their preferred partner, you know a lot of that stuff because you’re usually given that contract to read. That[s several hundred to several thousand pages, depending on the size of the building. And you have days to get the proposal in.

 

Ray

If our client here listening in, maybe they have been involved in construction cleanup as an employee. They started their company and wondering, looks involved, but it really seemed like good money before. What would you tell them?

 

Joel

Be careful because a lot of these construction sites are not going to pay you or construction companies are not going to pay you until the work’s done.

 

Ray

All the work’s done?

 

Joel

All the work’s done. Or they have a monthly report that you have to fill out and you have to have a very detailed (description) of what you did. How much percentage of the job is completed. And then you can build up to that amount, particularly if it’s a multi-month type of a project. As well as, usually there’s what’s called a retention, and they hold 10 % of the money for one year. And when you actually do get your payments, particularly the final payment, it can be 60, 90, 120, 260 days. So, making sure you understand when you read those RFPs, the terms, when are you going to get paid, how often you can submit payments, requisitions on a monthly basis. And of course, if you’re going to be working there six months, they’re going to pay you fairly regular on the front end of this deal because they want you coming back. Once the project’s done, that last payment is not always easy to get.

 

Joel

And that last payment, that retention piece that they hold a year later… Sometimes it’s not paid out until everything from every company has fixed the problems. So, although you’re the cleaning company, you’re worried because the painting didn’t hold up for a year like it was supposed to. Or the masonry work or the electrical work. And that last bit of retention is held until everything is cleared and taken care of.

 

Ray

Good advice would be…

 

Joel

Have other work in your pipeline. (Yeah) Understand that this can be lucrative. But there are a lot of loopholes in it. And typically, even when they let you bid, they want to see a cost summary. How much chemical you’re going to use, all this, and it’s itemized on your quote, and they’ll only allow you typically a 5% profit and a 5% overhead. I don’t know too many companies that can work on a 5% overhead.

 

Ray

It’s an interesting business, Joel.

 

Joel

It is.

 

Ray

Thank you.

 

Joel

You’re welcome.