Maid service business owners, use these four steps outlined by industry leader Sharon Cowan, CBSE to grow your house cleaning business and make more money.
So the first quarter of 2012 has passed and we are midway through the second quarter. Remember those resolutions you made at the beginning of the year? Something about being more profitable? Or was it losing weight or perhaps even adding an exercise routine to your day? How are you doing? Now the personal issues about losing weight or exercising are really not my business, but what I will dig into is your profitability!
There are 4 ways you can add to your bottom line and therefore put more money in your pocket from your cleaning business.
1. Simply charge more for your service! Not a difficult concept, however sometimes difficult in the competitive marketplace today. By analyzing your breakeven point, your expenses, your margins, you will be able to adjust prices upward if you have to in order to make a solid profit.
2. Simply reduce expenses! Also not a difficult concept. If you are not making money, one of 2 things is happening; you are not charging enough to cover expenses or your expenses are too high. Analyze your P&L statements to determine where your money is going and how you can cut back on your spending.
3. Acquire more profitable customers. While this seems like an easy task, it may be one that requires some investment if refocusing your business model and marketing strategy. If your company image is one that attracts price shoppers perhaps because of discount slogans or “sales” looking materials, you will attract a bargain seeking client who will balk at price increases and leave you for the next low priced deal. It’s ok to say “no” to these kinds of customers and replace them with those who will pay your price. Drop the word discount in advertising messages and focus on value for price messages.
4. Up sell current customers. You already have a client base. Use it! If you haven’t added other options to your menu of services you are missing revenue that is going to other businesses. Develop a plan for expanding what you do to your current base for an easy quick way to add to your bottom line. After all, you have already spent money acquiring these clients. Why not maximize your investment and be the one call they make for all their needs.
Profitability should be your only priority and understanding your financial position is the key piece in the puzzle
Do you know the financial health of your company? If you answer “no” to this question, you are on the road to business failure. If you don’t know where you are, you will hardly know how to make good decisions for your business.
At the minimum, you will want to review your Profit and Loss statements monthly. Your CPA can generate those reports for you as well as your in house bookkeeping software. If I asked you today, what profit percentage your company had last month, last year, or 2 months ago, would you be able to answer? If I asked how your revenue is trending; up or down and at what percentage, would you be able to tell me? What if I asked what percentage of your revenue comes from weekly vs. bi-weekly clients, would you be able to tell me?
These are the kinds of numbers with which you should be familiar at least monthly. Just as a ball player cannot know what kind of swing to take when he doesn’t know the inning or the count, you as a business owner cannot make sound decisions about your business without knowing your numbers and where you stand.
Start reviewing your numbers regularly and make decisions that will “put more money in your pocket” today!
Sharon L. Cowan, CBSE
Sharon is a designated Industry Expert for several online janitorial sites and has written industry eBooks and white papers. She also has produced several C/D training programs, including “How to Make Money Cleaning Foreclosures” and “Post Construction Clean Up 101” and is author of the popular BSC University Series. She conducts workshops across the country working with residential and commercial cleaning company owners to help grow their businesses.
Like this article by Sharon, you may also want to check out “Lead the Charge into 2012 for Your Home Cleaning Business”