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Why Cleaning Businesses Fail and What You Can Do About It!

New businesses are popping up everywhere in your neighborhood. Chances are you’ll find plenty, from small shops to restaurants and even cleaning businesses. According to Industry Canada, between 2002 and 2008, and average of 100,000 were launched each year. That’s almost 1 million businesses launched during that eight year period. But there’s a bad part: after five years in business most of them disappear. Only half of small and medium-sized businesses make it to their fifth birthday, and about 15% don’t even make it through a full year.

Even though I’ve been in business for nearly five years now, I can say that most things related to my cleaning business come second nature. However, that wasn’t always the case, especially in the very early going when I just started out. I made many mistakes along the way and continue to learn my lessons even today. Part of the growing process for any small business owner is the ability to recognize their mistakes and hopefully learn from them along the way.

Looking back now I’ve made my fair share of mistakes and wasted a lot of money in the process. For instance, I mixed my personal and business spending from my cleaning business’s account. I also spent some money stupidly on newspaper ads, only to realize that they were very ineffective for my type of business and who I was going after. Needless to say, I wasn’t perfect. I learned from it all, and more importantly recognized that in order to have success there needs to be failure along the way.

So here are a few reasons why I think small cleaning businesses fail, and how you can avoid becoming part of the failure figure.

Mixing Personal and Business Spending

Almost every entrepreneur overestimates their ability to generate revenue, or underestimates what it’ll take” to start making money Eventually once the money does start rolling in, many result in spending their hard earnings by the inability to separate personal and business spending. When a business is started, there’s an early period where you’re just digging a pit and throwing money into it, and making money could take longer than expected. Some firms, however, aren’t prepared for revenue delays and simply run out of time and money. So, they start pouring in their own money in order to sustain the business, then revenue starts coming around, and then they take the revenue away from the business in order to return the money that was “borrowed” earlier from the personal account. In order for your company to sustain itself, you as the owner and mastermind behind your company need to get your hands dirty, do some of the cleaning or anything else for that matter. Because the more you’re capable of doing yourself, the more money will stay in your pocket, and the stronger your business will become over time.

Subbing Out The Work

The main idea behind a cleaning business is cleaning its self. If you don’t enjoy cleaning, you’re not going to succeed and your cleaning business will fail. Far too many people get a nice business account, but either make up a great excuse as to why they can’t do the cleaning them selves or simply don’t want to do any cleaning – so they sub the work out. Beginners need to understand the financial implications of subbing the work out.  If you have only one or two accounts, and subbing the work out (or majority of it), you’re essentially taking out profit from the bottom line.

Hiring Others to Solicit New Business

Far too many people want to wave a magic wand and just get accounts by hiring someone else to do it for them. Beginners need to understand the financial implications of getting each account. I mean, at the end of the day you only want profitable accounts. Having just “any” account is pointless, you need profitable ones! Hiring someone else to do your cold calling essentially eliminates yourself out of the picture. You lose your ability to negotiate, add or subtract details and you rely on someone’s closing skills. So if they’re incapable of properly closing a potential deal, well that’s your loss.

So, rather than hiring someone to make calls for you, you should be soliciting for new business yourself. Most newbie business owners either hire someone on part-time basis or hire some appointment setting company that  just calls around and in hopes of finding companies that wouldn’t mind having a competing cleaning company price cleaning their facility. The type of companies that say “yes” to appointment setters are just PRICE SHOPPERS. They are out for the lowest bid in many cases. Even if the business owner lands this type of account, the profit margin will be slim to none.

Little Value Offered

So you’ve started a new business nd you think it’s great. Even your cranky in-laws think it’s a winner. What could go wrong, right? For a number of reasons, entrepreneurs often have an inflated sense of their businesses value offering worth in the marketplace. If your new business doesn’t offer a solid value in return, why would anyone want to do business with you? They certainly can do business with someone else who’s far more established and brings a lot more credibility. If what you’re offering is only a little better, it’s not going to be enough to generate the traction that you need to keep your business sustainable in 2 or 3 years. Your cleaning service needs to be 10 times better than your competitor’s.

Final Thoughts

Spending money before you ever make any is a dangerous scenario that you should avoid.  Rather invest your time and learn the process for yourself. Your success depends on it. I’ve been cleaning offices for nearly five years now, and I did it all mostly myself. Maybe my business could have been twice as bigger than it is now, but I chose to take the slow route, one that’s also more secure. All the accounts I have today I got myself or through a referral. I never spent a dime to have someone else solicit for me. I handed out flyers, attended group networking seminars, and cold called hundereds of businesses.The people who run into trouble outsource a lot, because they don’t take the time to learn the business themselves. Instead they willingly spend their personal money hiring others to the work that they can do..

Getting Your First Cleaning Business Leads

 

When you first start your cleaning business, you’ve got new crisp business cards, ads that you personally developed, cleaning supplies ready to go and eagerness to start cleaning. However, the success of your cleaning business, home cleaning or commercial boils down to one thing: you need leads.  Without your first cleaning business leads you might as well shut down shop, because let’s face it, business leads equal sales and sales pay yourself. Leads are what successful sales people convert to customers and grow long lasting relationships. If you can successfully convert your cleaning business leads, you are off to the races as they say.

Sounds simple right?

Actually it is pretty simple. Converting your cleaning business leads into customer is essentially your bread and butter of how successful you’ll become with your cleaning business or any other business for that matter.  The place many people get off track is at the beginning, as they don’t even know where to start.

Certainly we can mutually agree on one thing: there are many ways to get cleaning leads. But which ones are most effective? Which require a minimum investment of your time and money? These are some of things you need to think about. Hopefully in today’s post I’ll be able to make the picture clearer en route to gaining some of your first cleaning business leads.

Hand Out Flyers

This is probably the most simplest, least time consuming and least expensive way to gain your first cleaning business leads. When I first started out, this was my bread and butter. It worked well for me because I could create my own flyers and more importantly distribute the developed flyers myself. Here’s how to effectively hand out flyers in hopes of gaining your first cleaning business leads.

  • Develop your own at home flyer
  • Include a few words on why anyone would want to do business with you
  • Don’t forget to include your phone number and any other contact info
  • Hand out your homemade flyers to friends, family members, neighbours etc.
  • For those of you in commercial cleaning, visit small businesses in your neighbourhood during and after work hours.
  • Always carry business cards, and be ready to hand out at any interaction along the way.

FREE Advertising

A website, even a simple design, will place your business name on the Internet, but that doesn’t guarantee that your website will rank high or even display in search results of Internet users looking for the products or services that your business offers. Let’s hope that you either have a website or that you’re in the process of creating one. Having a website is one of the simplest ways to establish online presence. Here’s where you can advertise your new cleaning business online for FREE.

Yahoo Local – One free business listing where you can include your web address, phone number, physical address and add your business up to five different categories.

Google Places – Very similar to Yahoo’s Local where you can add your web address, phone numbers etc..

Merchant Circle – Similar to Google Places and Yahoo Local. It offers the same free basic online listing, but it also allows you to add a picture.

Yelp Canada- Enter you business name, address, phone, email, website URL, up to three categories, and hours.

Kijiji – On Kijiji you can list your print ad for free and up to four pictures. You can customize the ad any way you like. Here’s a sample cleaning services ad on Kijiji.

Craigslist – Very similar to Kijiji in the sense of you listing your own cleanings services under the category services offered. List your website, phone number, address and up to four pictures.

Cold Calling

Cold calling is one of the hardest things to perform successfully.It’s s sore topic for most as most entrepreneurs dislike cold call. Let’s face it, who likes getting doors slammed in their faces. I certainly don’t. It’s demoralizing, exhausting and very counter productive. However, I learned cold calling can be effective by simply doing the following:

  • Plan before you call
  • Seek out a personal connection
  • What can you do for the client attitude?
  • Careful note taking

Direct Mailers

This is a real simple process.However, I’ve never done much direct mailing. This isn’t because I don’t believe that the process is effective, in fact direct mailers are very effective. Friends in the cleaning industry have been very successful with direct mailers. Anyways, I won’t get into details as to why I haven’t done much direct mailers, but instead wanted to share with you on how you can use direct mailers to gain your first cleaning business leads.

So, by now you may be wondering where you’re going to get addresses for your direct mailer? Well there are several ways you can get cleaning leads (addresses) to mail to.

  1. City Directory – Mainly for residential homes.
  2. Online Search - Mainly for commercial establishments.

You can make good use of your local city directory by heading  to the nearest library where it’s kept and making use of it regularly. In case you didn’t know, this book not only contains all the names and addresses of anyone living in your town, but other information about them as well such as household income (in generic ranges only). All you need to do is ask the librarian for the City Directory. The librarian will then probably ask for your ID which they may hold this until you finish with the book.

Pay attention to high-end neighborhoods in your area, then copy the pages with all the names and addresses. Then head home and take the info from the copies and start writing envelopes. After that you just stuff the envelopes with your marketing and place them in the mail. You can include a sales letter with a flyer plus a business card inside. This is a real simple process that works provided you have quality marketing material. Quality will depend on your interpretation of quality, so take your time developing your flyer.

Cold Calling Success With Your Cleaning Business

Cold calling is one of the hardest things to perform successfully. Knocking on 50 doors a day, and only getting two or three promising leads would lead even the most confident person to give up. That’s the downside of sales is any industry, whether you’re selling yourself, your service or a product it can become demoralizing pretty quickly. When I first started out with my cleaning business, cold calling was relatively foreign to myself. I had the marketing background, but selling was certainly not my cup of tea. It took me months to land even a solid two or three leads, but eventually I started to turn the corner and the leads became customers.

After growing frustrated, I turned to some reading and a friend who’s been in sales for as long time in hopes of revamping my strategy. I cut my number of calls down, but spent more time researching and weeding out prospects before picking up the phone.  Here’s what I learned and how I became friends with cold calling again.

Plan Before You Call

One thing I failed at miserably was planning ahead before I made the cold calls. I used to think that by dropping in with a business card would be enough and the business would start to pour in. Boy was I wrong! I realized through a lot of trial and error that it’s not about the quantity, but rather about the quality of the cold calls. Who will you be calling? When will you be placing your calls? These are questions you should answer the day before you make the calls. Since there are many businesses, target a certain section of the city or certain types of businesses. This will help you stay organized and delay your travel time. Since I was employed full-time, most of my in person cold calling took place in the evenings or weekends. The upside to this was that it gave me an opportunity every evening to sit down, block out sometime and organize myself ahead of next day’s cold calling.

Research  Before You Call

This point could very easily tie in with planning before you call, but I wanted to separate it to simplify the process. Researching ahead of your cold call seems pretty tedious, but the success of your call totally depends on how well you arm yourself before the call. The more you know, the better you’ll be off when you walk through the doors. Simply stop do a Google search on the company ahead or even look up the prospect on LinkedIn before you make the call. Even if you’re not going to use the information, you will come across more confident and more powerful when you have information on the other person and their company.

Seek Out a Personal Connection

Whether through online research or during the phone call itself, you should try to find a personal connection with your prospects. Your research might reveal that you share the same view on a mater or have a past connection with the same company. During the call, you also might discover a common interest. Let’s say that your kids and your prospect’s kids play hockey, this would be a great way to break the ice and ease the pressure on both sides. More importantly, it will give you insight about the prospect on a deeper level.

What Can You Do For Your Client?

Never forget this: People don’t care about you, they care what you can do for them. Ask a lot of questions during the call, rather than talking about yourself. Show your prospect that you care and are there to help, rather than just do another pitch like all the other predecessors. Learn about your prospect’s business needs first, so you can more effectively tailor your pitch.

Careful Note Taking

Since you’re likely a start up or relatively new in the cleaning industry – you likely don’t have a proper professional note system on your computer. However, that shouldn’t stop you from taking careful notes after your cold calling session. What works well for me is my notebook. It’s a simple 250 page notebook that I write down all my thoughts, ideas, sales visits, and other notes pertaining to the business. It’s easy to follow, as all my notes are dated and more importantly it’s all within one place. Often this notebook doesn’t leave my house, but anytime I leave the cold call session I ensure to take a business card with me. Generally I make a couple of quick small notes on the back of the card, which I later revisit and transfer into my notebook.

Final Thoughts

Sales calling is never an easy process, but not following any of the above suggestions makes cold calling that much more difficult. Rather than only going up against a potential prospect, now you’re fighting against yourself due to lack of proper research, preparation and planning. Get into a routine of doing the above steps, and soon enough this will become second nature, but more importantly your cold calling success will become greater and eventually the sales will start to flow in over time.

Readers, could you suggest any other tips for cold calling?