Does My Commercial Cleaning Company Need MORE accounts or BIGGER Accounts?

Episode 28.

 

Ray

Joel, we’re back, and we’re taking on a big question. “Do I need MORE accounts or BIGGER accounts”?

Joel

I don’t know how hard do you want to work?

 

Ray

Well, I don’t want to have to work too hard. In fact, I’d like to get you to work at the speed I am. I just want to make more money.

 

Joel

Well, then this is the right question for you, sir. The best way I can put it is If you have an account that maybe you charge $300 a month, a lot of smaller companies. Probably where they’re starting, that might be a once-a-week account, might be around $300 a month. How many accounts would you need to generate $3,000 a sale. You need 10? (Right.) Okay, well, they’re 10 buildings. Where are they? How far are they apart? Are they on the opposite side of town? How much are you going to have to stock? How many vacuum cleaners do you need?

 

Ray

Oh, we’re back to the vacuum cleaners.

 

Joel

Do you need cleaners or are you going to do it yourself? You’re going to bring one vacuum around, but then you got all the drive time. You got all that. Those smaller accounts, you have to look at a lot differently. So, if I can go up and get one $3,000 a month account, all right, I’m going to have to hire two people for that. So, I’ve got a labor of two, I might get away with one vacuum cleaner. I’m buying a vacuum as opposed to 10 or 10 upright. (Sure). And then even my chemical cost. Because now I’m going to be able to afford a dilution center into a building. Cut my cost down & make sure things are getting mixed at the right ratios. So, it’s taking care of the cost of my cleaning chemicals. It’s increasing employee safety. And it’s looking out for the client because we’re using the products the way that they’re made, the way that they’re designed; At the dilution they’re meant to be used at instead of free-pouring; Avoids slip fall hazards by having the floor sticky or surfaces sticky that are going to allow for germs to go. So there’s a big difference in how you look at these types of facilities.

 

Joel

And if you’re looking to scale your business, you want to make sure that you start looking at these larger businesses, because if you’ve always been selling those $300 to $400 accounts, you’re spread thin. And that’s 10 customers or 15 customers that you now have to perform customer service on. What happens if there’s a glitch in your system because, oh, We had a tornado; We had an earthquake; There was a snowstorm, COVID hit, and we had a large amount of people that were out; No-call, No-shows. And some of the buildings, the way that our clients have it, oh, you have a two hour window to clean. You have a three-hour window. The building is automatically alarmed. You get there with 10 minutes left. What are you going to do? You got 10 minutes. You do what you can. (Yeah.) A larger building, you usually have more access to, longer access to, and you can usually juggle and have the crew help with the other person’s out. Then the manager, usually, if you have larger accounts, you have some type of a manager in place. Then the manager might to go over for a given night and help out a little bit, too.

So larger accounts actually create less management work overall because the costs are going to be down to get them up and going. And then when you start getting paid on these larger accounts, your cash flow becomes a little bit better. When you look at your cash flow on little accounts, making 20% of $200 – $300 – $400 is not the same as making 10% on $3,000.

 

Ray

Can I ask you a question regarding the age of the cleaning company? (Yes)

 

Joel

The other thing in companies, assuming they have some experience doing what they’re doing, they branch out on their own. Would you still recommend going after the big ones? Or do they need to cut their teeth on some of the smaller?

 

Joel

They need to cut some teeth on them because they have to figure out what are they good at. They need to figure out if they even want to stay in this industry because news flash, it’s a very negative industry. Nobody calls you up to thank you for the knot that you tied on the bag. They’re going to call you for the one trash can out of the thousand (that was missed). And it’s going to be a catastrophe because it was the CEO of that company’s trash can that was missed on that day. And it caused a dramatic uproar in the entire company. And they didn’t sell their largest client because he was all upset or she was all upset before they went to the board meeting.

 

Ray

I’m a sensing sarcasm. But I get the point.

 

Joel

Yes, it’s sarcastic. But yes, that is what happens, is that if you can’t handle the complaints that come in with smaller companies, just think about it. What if you were the owner of the company and you just got done and you’re small. And you clean all the accounts yourself. And you go home that night, all the whooped. You’re tired, and you get a call at seven o’clock in the morning when you’re still asleep, and then someone saying, “Oh, you didn’t place the toilet paper in the building”. Your first thought is, I know I did. That’s everybody’s thought. Because nobody goes into work to do a bad job. Everybody thinks they did a great job, and they made no mistakes. So, when it’s actually you that does it, it’s very hard to swallow that pride and say, “Okay, I’ll be right there”. Because you deep down think that you did it. And then, when you go and show up, and sure enough, you forgot the toilet paper.

Ray

But again, for those young cleaning companies. Cut your teeth; Get to know what type of accounts you’re good at; Get to know what type of accounts you want to be good at.

 

Joel

Then you start branching out. You could do that by some of the other episodes that we’ve talked about, about networking to get into and get past the gatekeeper.

 

Ray / Joel

Great advice, Joel. Thank you. (You’re welcome.)