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Setting up Your Business Structure for A Cleaning Service
 
 
Setting up Your Business Structure for A Cleaning Service
 
 

Your business plan will help you determine the direction of our business, lay out a plan for operations, and other important matters. However, the next step is putting the actual business together so that you can follow that business plan to success. From the name to the finances, there are many matters to take care of before your business is ready to go. Each of the following is a critical step towards building a successful business on your own.

Naming Your Business:

You want a catchy business name that sparks a positive image in a customer's mind. Whether you play on the words of popular phrases, use catchy rhymes, or stick with something simple, you want the clients to picture a hard-working, dedicated cleaning team. Your name should reflect your style and the services you offer, so keep it true to your business.

  •     Keep it concise. Don't overwhelm potential customers with a long title that describes every single service you offer or has too many cutesy words making it long. You do need to provide a little specification, such as including "cleaning company" in the title, but you don't have to go into every individual service that you offer in just the name. 
  •     Make it easy to spell. How is a customer supposed to find your business online if you have made it too difficult for them to even type in the search bar? You want clients to be able to find your business easily. 
  •     Avoid negative connotations. Remember that this name is the very first impression you give a customer, so it is important to draw customers in, not repel them. Keep it positive and away from any derogatory slurs. The name needs to be memorable and stand out in the customer's mind. 
  •     Avoid too "cutesy" names if applicable. If your target customer-base is composed of commercial clients, you most likely want to steer away from anything too cutesy in your name. These clients will be looking for a professional, hard-working business, and while you may be able to provide those services no matter what, a non-professional name may turn them away. 

    How do you begin to find a name that meets all of the above standards and more?

    1. Brainstorming session - Sit down with a pen and paper and write every thought that comes to your mind, no matter how terrible the ideas sound. This will get your creative thoughts flowing and you may end up with a great idea in the midst of all the terrible ones.

    2. Try it out - Run the name by a handful of friends and family, and see what their reactions or initial thoughts are. If you aren't settled on just one name yet, then pick a few of your favorites and ask for some thoughts on which one you should go with.

    3. Check up on the name - Make sure that the name you have come up with is not already taken in your area! You can do a search online at the U.S. Patent and Trademark Office (USPTO).

     

    Some people may choose to use their personal name in the name of the business, but just be aware that this may make reselling in the future a bit more difficult! If your business is personalized and has your first name in it, buyers might not be as interested since they don't share the first name. If your plan is to resell in the future, then keep that in mind as you develop your business name. Think of something that would attract buyers, just as it should attract the customers to use your services. Don't limit your potential client-base by the name, which is a possible risk if you create something with stereotypes or too specific of an audience.

    Licenses:

    Interested in learning more? Why not take an online class in Starting Your Own Cleaning Business?

     It is necessary that you check up on what the requirements are in your state and local area. A business license is generally used for tax purposes and identification. Find out what local requirements might apply to your specific business and follow through with that so that there are no related issues in the future. There may be fees to cover in order to obtain the proper licensing, so keep this in mind as you finance and budget.

    Insurance:

    Since your business involves working on somebody else's property, business liability insurance would be a wise investment for you. There is always a risk of damaging the customer's property, falling from a ladder, theft accusation, and a wide number of potential lawsuits. Without proper insurance, you are at risk to expensive legal fees that could bankrupt your new business. Don't put yourself in that situation, but instead prepare ahead of time and tackle the problems before they arise.

    Many commercial clients even require that you have insurance before they will consider hiring your business, as they don't want the hassle of dealing with a non-insured business in the event that any of the aforementioned risks occurred. Liability insurance covers you in the event of property damage or personal injury, both of which are a risk in the cleaning industry. The cost of the insurance annually is worth the price you would pay otherwise, in a lawsuit or in damages. Not only does it cover you and your business, but also the risk of your employees.

    If you aren't sure what insurance company to use, ask around with other cleaning services or research local options that might be a cheaper or more personalized option. There are certain bundles and deals you can get to make the insurance a little more cost-efficient, depending on what you are looking for. Look for someone in particular who specializes in what you do, as they will be able to expertly guide you through the process and make it easier on you. They will know exactly what you need in an insurance package to cover all the bases and keep your business safe and secure.

     

    Legal Issues:

    Starting a cleaning business entails a lot of unique legal issues, compared to other small businesses. As mentioned above, you will be working in people's homes and on their property, so this puts you in a different position than many other business that operate from their own property. There are a few important matters that have not yet been addressed which you will need to keep in mind:

  •     Health and Safety - Check with the Occupational Safety and Health Administration (OSHA) to see what their regulations are regarding your new business. They issue many regulations regarding protection, safety, employee's health, dealing with hazardous substances, and a variety of other regulations that may pertain to your business. Failing to meet those standards could lead to legal complications regarding the safety of your business operations. It shouldn't take long to run through a checklist and figure out where you stand with the regulations, and that is worth the prevention of future complications.
  •     Policies - Since you will encounter a large number of different customers, you will come across a range in expectations for your business. You might choose to put your customer policies on your website, but you have to assume that not all customers will have access or choose to go to your website. Before agreeing to clean for a customer, provide a printed version of your policies so that they can have a clearer idea of what to expect from your business. This includes aspects such as who will purchase cleaning products, requirements for the workspace provided (heating, cooling, ventilation), rules about operating the customer's belongings (washing machines, dryers, dishwashers), the privacy of customer's information, and other pertinent information.
  •     Contracts - When you sign on with a commercial client for a routine cleaning service, a contract can help you ensure that you get paid and keep many legal matters from arising. This can also be used with homeowners and smaller clients, but it is primarily suggested for larger clients who will be requiring your service for more than a year.2 A contract should specify the policies mentioned above and how they factor in to the business relationship between you and the client. If one of you violates the above policies, determine how this affects or terminates the contract.
  •     Employees - An important step to covering all your bases with legal issues is to make sure that you do a thorough background check on each employee you hire. Customers are allowing these employees into their homes and business on your word, so you need to be completely sure that they are trustworthy and have no hidden past that could arise in a legal case. All of this must be done, however, without violating privacy laws or asking questions that are not legally permitted. Look into the employee requirements for your industry, such as minimum wage, required documents, and classification for your employees.

    On the other side of the matter, make sure that you are also treating your employees fairly and legally. Check into what the required minimum wage is, look into benefits for full-time workers, and stay true to the assurances you make them regarding pay and hours. Being fair to your employees and following the law will keep your business from a nasty lawsuit.

     

    Start-Up Funds:

    Where will you acquire the money to get your business started? There are a lot of bases to be covered financially, and it might be some time before you begin making a profit, so you can't afford to slack in the financial area of business. Take a moment to consider everything that needs to be financed and paid for from the very start of your business:

  •     Equipment
  •     Office set-up
  •     Business license
  •     Insurance
  •     Employee wages
  •     Company car/uniforms
  •     Marketing
  •     Training
  •     Etc.

    If you are starting this new business on your own, it might be a safe bet to assume that you can't cover all these costs with money out your own pocket. If this is the case, the good news is that you do have options available to you. There are a few different routes you could take to obtain the funds, such as investment, loans, or raising the finances through other means. Take a look at all of the options available to you and determine which direction you see your business taking:

  •   Crowdfunding - This method has become an extremely popular way to raise start-up funds for a new business, as it allows for a situation of small investments, rather than the request for one large investment. This type of funding is typically found online, as a network of individuals pool their resources and money to aid in the efforts of other people like you. This approach takes planning, as you want to get the word out on your business well in advance so that enough people know about it to help you out. The more people you have spoken to and contacted about your business, the higher probability you have of meeting your goal. Start spreading the word ahead of time and collecting email addresses, so that when you start your crowdfunding campaign, you already have a network of potential investors who can help you out.

    Develop a plan before you start asking for money, so that donors know they aren't just throwing their money away to a failing. Draw up the business plan and present the projections to any potential investors who are wary, if you need to convince them that you have what it takes to succeed. All you need are some finances to get you going. If you choose to use an online platform to accomplish the crowdfunding, always be sure to read the fine print, because many of those sites have an "all-or-nothing" type approach. That means that you either hit the target goal of funds, or you don't get any at all. If this is the case, set your request low enough that it is reasonable for you to achieve. Be gracious to your donors and award them if possible, through discounts or thank-you gifts. Let them know of the progress of your business and how you are putting their money to good use.

  •   Family and Friends - This may seem like an uncomfortable approach to take, but getting loans from your family and friends can help you avoid all the legal hoops you would otherwise have to jump through. Just remember to be professional and treat this like a legal contract, and it won't be that difficult of a process. Before you approach anyone, determine how much you need to successfully launch and maintain your business until profits start coming in. Make a projector of how long it might take for you to pay back the loans, and then offer this information to the friends and family that you speak with.

    Show them that you are serious about your business and have a plan to make it succeed. Communicate and be clear with the progress as you go along, and demonstrate clearly how you are putting their money to use in your business. Write down the transaction, even though this is only a loan between friends, because a verbal agreement is often not enough if conflict should arise.

  •    Loans and Grants - Check with the U.S. Small Business Administration's website to see what loans or grants might be applicable to your business. In order to acquire a loan, you will need to file an application form and a business plan for your new venture. This is something that all loan programs require so that they can see the potential of your business and how you plan to put the money to use. If you can't show how you plan to develop and grow your business, then your loan application may be denied.

    Before you are accepted for a loan, there may be other required documents to turn in as well, depending on your specific case. Income tax returns, financial statements, business credit reports, and other legal documents are all part of the reviewing process. The SBA website has a loan application checklist that is a free resource for you to start figuring out whether this is the right path for you.

  •    Bootstrapping - Quite simply, this is the "do it yourself" approach, in which you start your business with your own personal funds. You can utilize your savings accounts and zero-interest credit cards to make this happen, as long as you are confident in the success of your business. It can be a risk to invest all of your savings into your own business, but it can pay off in the end when you aren't repaying loans or interest.
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