Count The Cost of Your Janitorial Proposal

Suppose you wanted to build a tower. Wouldn’t you first sit down and count the cost to see if you have enough money to complete it?

CleanlyRun blog post image - Crane

For if you lay the foundation and are not able to finish it, everyone who sees it will ridicule you saying, this person began to build and wasn’t able to finish.

These wise words written 2000 years ago are still true today. And these foundational truths has guided me well for many years, from running multiple businesses to navigating life.

In this Blog Post, I’m focusing on how to determine what it will cost to clean a building before you set your bid price. You MUST “Count the Cost” first!

Based on my three decades in the Janitorial Industry, here’s my Top 10 list of considerations required to calculate a profitable Janitorial Bid!

  1. GENERAL BUILDING TYPE: Different building types have different cleaning times/production rates. A 3,000 sq’ fully carpeted Library may only take 2 hours to clean, while a 3,000 sq’ Medical Clinic with 1500 sq’ of waxed VCT floors may take 4 hrs.
  2. CLEANING FREQUENCY AND LEVEL OF DIFFICULTY: Cleaning difficulty level is gauged not just by the size of a building, but rather by looking at the number of employees in the building (Building Density), plus the number of customers or patients or clients – the “Traffic” – that frequents this building on a daily basis. Higher building density/traffic results in longer cleaning times, which equates to a slower cleaning production rate for you and your cleaning staff. Basically, the more people in and out each day equals more trash, spills, messes, etc., which means it takes you longer to clean.
  3. CLEANABLE SQUARE FOOTAGE AND FLOORING TYPE: Whether you count ceiling tiles, get the number from your potential customer, or look online at the County Property Appraiser, make sute that you get the actual Cleanable Square Footage. Did you know that carpeted floors clean 15-20% faster than hard floors? And that waxed, vinyl tile floors with a shine can take 10% longer to sweep and mop than other hard floors like ceramic tile?
  4. DETERMINE PRODUCTION RATE: A facility’s Production Rate refers to how many square feet of a building can be cleaned by one person, in one hour, performing a set of standard cleaning tasks. Of course, you will have a much slower production rate when doing residential and construction cleaning.
  5. TOTAL DAILY CLEANING/LABOR HOURS: Once you have your Production Rate, this rate is then used to compute how many hours are required to clean a building per visit (i.e., the Daily Cleaning Hours). And once the Daily Cleaning Hours have been workloaded – that is, labor and wages have been distributed across these hours – then the bid’s Labor Costs can be computed by the system.
  6. LABOR COSTS: Once the Daily Cleaning Hours have been workloaded – that is, labor and wages have been distributed across these hours – then the bid’s Labor Costs can be totaled.
  7. ADDITIONAL PAYROLL COSTS: These costs typically include applicable Federal, State dan Local Taxes, as well as Work Comp, etc. There are government websites that can give you your state rates to go by. Your Accountant can help you. Also, there are many payroll software programs as well as many Employee Payroll Companies and Employee Leasing Companies that will give you an exact percentage.
  8. CHEMICAL /SUPPLY COSTS: These can run 3-10% of your monthly costs and expenses. These costs typically include floor cleaner, glass cleaner, all-purpose cleaner, disinfectant cleaner, bowl cleaner, stainless steel polish, etc. Buy chemicals in dilutable, concentrate form to keep costs down. Chemical mixing stations are great also. Products like bowl cleaner and stainless steel cleaner are usually sold “ready to use” (RTU), and cost a bit more, so shop around for reasonable pricing. Equipment like vacuums, buckets, floor buffers, etc. are an upfront cost that can be depreciated over time (talk to your Accountant).
    Chemicals like floor stripper, floor finish and carpet cleaner are an expense if you provide your customer with extra Specialty Work, but is included when and if you add these services in your bid.
  9. OTHER MISCELLANEOUS COSTS / EXPENSES / OVERHEAD: These typically include things like.. higher level managers over multiple buildings doing inspections, training, cell phone costs, fuel, etc. When you’re just starting out with only a few buildings to clean, these costs are minimal and can be hard to define, but figure in at least 2-3% to be on the safe side, even if you are the only employee and do all the work.
  10. TOTAL JANITORIAL COSTS / EXPENSES: Congratulations, now that you’ve calculated all of these costs and expenses you’re ready to “SET YOUR PRICE” (via Profit Margin or Cost Markup)!

Keep in mind:  When you get requests for a Janitorial Proposal, that’s the time to create a winning bid! If you’re content with the way you’ve been calculating your Total Janitorial Costs/Expenses,” that’s great. But if you’re looking for a proven competitive edge – my automated best practices – I encourage you to try a free 30 day trial of CleanlyRun Janitorial Bidware.

Check us out at CleanlyRun.com… Let’s grow your business!

CleanGuidePro Successful bidderDrake

Top Ten Janitorial Business Systems!

A Janitorial Business Leader Manages Systems and Procedures!

The simple definition of Management is, “the act of managing something”. O.K., sounds simple, but exactly what is the “something” that you manage and how do you manage it? If you think it’s you personally managing your business, operations, employees and customers, etc., you’re partially right and completely wrong! Hear me out..you “CANNOT” manage people, operations, payables, receivables, etc.., you can ONLY manage the “System and Procedures” that manages people, operations, payables, etc.!

Business 101 and every successful business franchise model will tell you that they have systems and procedures in place for everything! Look at McDonalds for example. If you eat a cheeseburger and fries in California and one in Georgia, it tastes exactly the same and all their worldwide customers get the same consistent experience. It’s not by chance I can promise you…, it’s because they have systems and procedures in place that cooks the fries exactly 7 minutes and the cheeseburger has the exact same meat size, amount of ketchup, mustard, onions, etc.

Every business type (that wants to thrive and grow) must have specific systems and procedures in place to provide consistent predictable results! When something goes wrong, which is inevitable in any business, the corrective action should be to look at what Systems and Procedures have failed and implement corrective action. There’s countless management books and expensive seminars (which are fine and helpful) on this topic. I could write whole chapters in detail about these systems, but let me just touch on my Top Ten free, time tested Systems and procedures that have served me well in 25 years in this great janitorial industry.

  1. ORGANIZATIONAL SYSTEMS! You must establish a personnel organization chart. From Owner, President, Managers, Supervisors, Team Leaders, general cleaners, etc. Take the time to write out a “Position Contract” for each position, defining responsibilities, duties and who they report to and who reports to them.
  2. HIRING SYSTEMS! You can have the best systems and procedures in the world, but they won’t work without the right people. Before hiring, don’t just rely on a good feeling. Have an initial checklist of initial interview questions i.e. “tell me how you solved a conflict at a previous job”, etc.., check references, do background checks, call former employers, etc. Get the “right people”!
  3. EMPLOYEE SYSTEMS! Telephone clockin sytems with caller ID to track showing up and hours in bldg, dress code, conduct code, call out procedures, time off request procedures, employee/customer interaction procedures, verbal warnings, etc., etc. All this should be in an employee handbook that each employee receives and signs that they will adhere to it. Also, don’t forget affordable Employee Incentives!
  4. TRAINING SYSTEMS! Safety training, new hire training, supervisor training chemical training, floor care, carpet care, etc. Your staff should know and be trained in exactly how it’s expected to be done here!
  5. INSPECTION SYSTEMS! For Quality Control. Scheduled routine and formal building inspections to find and fix deficiences is the #1 Way to keep quality up. Be Proactive. Remember people do what you inspect not what you expect!
  6. CUSTOMER SATISFACTION SYSTEMS! Have a specific customer contact person, keep them informed of what your doing to take care of them through monthly reporting of inspections, floor work, carpet cleaning, supply deliveries, etc. and ask them how you can serve them better through satisfaction surveys and/or face time at least once a month. andThe #1 Way to keep the customer satisfied is to keep their facility clean!
  7. OPERATIONAL SYSTEMS! The day to day operations. How are supplies ordered/delivered, machines and vehicles repaired? Create schedules and procedures for all the mundane things that need to get done. Then delegate and manage the system!
  8. FINANCIAL SYSTEMS! How do you pay for it all? What’s your exact overhead fixed expenses%, variable expenses%, labor%, net profit%? Know exactly what it costs you to run your business monthly, then have systems in place for cash flow, budgeting, accounts payable, receivables, payroll, taxes, etc. Count the costs!
  9. SALES AND MARKETING SYSTEMS! Word of mouth new business is not enough. What’s the most “cost effective” way to systematically market your business and create steady new sales. Believe it or not, I have for years and you can also generate leads with customers calling you to place bids each month with the “right” direct mail marketing system for less than $100 a month! See how in the free bonus, marketing materials section in my CleanGuidePro.com janitorial bidding software!
  10. OPERATION MANUALS! Document all your systems and procedures in operation manuals. Everything should be written in these manuals as if you’re creating a franchise model. Review and update as needed for a “turnkey” business that has actual resale value whether you ever want to sell it or not!

In business the system is the solution!

CleanGuidePro Successful Residential Cleaning bidderDrake