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Compiling last months, monthly report (July 2012), I realized about 20% of the total volume was from commercial contract work. I think the slow months will be much better this winter. I’m grateful I’ve taken this added direction. The Lord has blessed me well.
Great work Gordon. I agree, if you can get the right mindset, commercial work can be a saving grace. We have added 2 new high rises and a church to our commercial biz in the past month(although church we had cleaned before, but now we have them on a maintenance plan for set $ amount per month). Although these are high volume jobs, my margins are pretty low. That said, I know that on certain months I have these jobs already booked and the money budgeted. This can be tough for me to swallow having low margins and feeling like in a sense I am giving away work, but it keeps my doors open during slow months and employees paid. That is the point of these contracts. Plus, we have in the past, and I bet we will in the future, get new residential customers from the church congregation and also residents in the high rises (already cleaned $350 condo job in new high rise). I used to asked my brother who lived in Vail, CO (ski town) how businesses survived the slow season. His response: “You pay your bills off the locals, but make your money off the tourists.” You can apply this to commercial work as well. Pay your bills off commercial, make your money off residential. Bring in enough commercial to cover insurance, work comp, franchise fee, website, monthly magazine you advertise in, newspaper ad, etc (fixed monthly costs), and residential will cover your hourly, gas and cleaning products plus some. This is applicable to any size market/operation too.
Oh, and if you ask how I got new contracts. One high rise has same mgmt company as a different high rise we clean for and the managers of each talk and the one recommended us. We did a bid for them last year (or year before?) and we didn’t get the job as we were too high I guess. Then, they requested another bid from us in February and we reworked our bid, and they finally called us to clean this month for a trial period of 2 quarterly cleanings (which is all I need to seal the deal). The church we’ve cleaned for once before about 18-24 months ago. They called to have us clean again and while we were in there, we asked if they would like us to give them a free estimate for pricing on a maintenance plan. They said yes, we gave them the plan, they are estatic and actually had us do everything we would have done this year on the maintenance plan to catch up (we pro-rated it). Last new high rise, we were in cleaning a unit for a rental company we clean for. One of my employees was talking to the building engineer/maintenance and the guy said they weren’t happy with the company they were using. He got building manager’s number, we went in and did an estimate for a maintenance plan and are cleaning there next week. Funny part about this is the day we got the lead for the last high rise, we had actually applied on the building management’s website (they run numerous buildings in town) to be on their vendor list so we could submit estimates and received an email saying thank you but our vendor list is full and we are not accepting new vendors right now. You hear everyone say the work is out there, you just have to keep your eyes open as there is no magical formula to find it other than…………ASKING.
Interesting info here!
I cleaned for a manufacturing company that gets their carpet very dirty. The first time I cleaned for them(7/09), the condition of the carpet was beyond hope but I gave it great effort. I went back to look at the dry results on the following Monday and was not impressed to say the least. The manager thought that it was better than he expected but still, we were not impressed. I talked to him about the value of cleaning more often but also explained that his carpet was beyond help. They since installed new carpet 8 months ago and asked me to give them a bid that resulted in me getting the job again. I bid it high knowing it would be very dirty. Approximately 7000 sqft for $1375. It took 2 people 3 hours to complete. I would like to present a maintenance cleaning agreement with him but am unsure the frequency and the dollar amount. My thought was to propose a quarterly cleaning at $500 each. They have their own cleaning staff that does a good job of vacuuming and detail vacuuming, leaving us with using the pile brush down the heavy walk areas. I think we can get our cleaning time down to 4 man hours at $125/hour(our minimum target). Since I am just now getting my feet wet with the maintenance agreements, I was hoping for some senior advice. Thanks in advance!
P.S. I feel I bid it too high and have not yet sent the invoice. (but he did accept it and he really loves our process)Brian Sutton
Brian,
In lieu of not having John Holibaugh’s spreadsheet to help us figure out commercial pricing based on costs, we have been working on developing our own with the numbers he provided (time allotted for square footage for vacuuming, buffing, extracting, etc). I would guess you need to be charging 7-10 cents/sq ft quarterly, and maybe a hair more if you are pile lifting areas (extra 2 cents?). I will throw the numbers in the spreadsheet tonight and see what I get and post it. The spreadsheet is still a work in progress, but if we get it to a place we like that is user friendly, I’ll see if it can be posted for everyone under the city owners page.
Hey Dave,
I was searching post looking to see what others are doing sq. ft. per hour. Wanted to know if you still had the spread sheet you were talking about, I also have one that I am more then willing to share, was just curios on your math and layout.
Pat
heavensbest@nctv.com
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