How to Start a Cleaning Business in 2021: The Complete Guide

Residential cleaning business

A residential cleaning business offers cleaning services at a client’s home.

Residential service providers supply all cleaning products, cleaning chemicals, and cleaning equipment needed to perform these cleaning services (unless otherwise agreed with the client).

Consider offering these cleaning services as a residential house cleaner:

Home maintenance cleaning jobs

Duties in this type of cleaning company can vary, but they usually include dusting, vacuuming, washing surfaces, mopping floors, polishing mirrors, and interior window cleaning. Most of these involve helping with regular household chores. Think of these as basic maid services.

Each client’s needs will vary and will need to be agreed upon before starting service. Some clients will need a window cleaner only, while others will want a mix of cleaning services.

Pricing averages for house cleaning and maintenance can vary by location, home size, etc.

Move-in and move-out cleaning jobs

No one likes to move. It’s stressful, exhausting, and after everything is moved out, there is still plenty of house cleaning left to do.

Landlords are often left with a rental property that needs to be properly cleaned to prepare for new tenants.

Moving cleaning services are highly sought after by customers and potential customers to lighten their load.

This type of cleaning service will go beyond simple home maintenance. While expectations will vary based on the circumstances, you can also expect to deep clean walls, appliances, windows, and more.

Pricing for move-in and move-out house cleaning services is generally a flat rate (as opposed to an hourly rate), determined by the amount of work needed and the home’s size.

Deep cleaning jobs

You may consider offering deep cleaning services for residential cleaning or commercial cleaning. This type of cleaning, also known as spring cleaning, goes beyond normal maintenance.

Deep cleans involve cleaning out pantries, cupboards, and more. It also will likely include walls, baseboards, fans, and other hidden areas. This cleaning is intended to prevent cross contamination and to deeply clean frequently used areas of a home or office.

The pricing structure for deep house cleaning services can be an hourly rate or a flat rate, depending on the client’s needs. And you can provide these cleaning services as part of your residential cleaning services and as part of your commercial cleaning services.

Residential event cleanup jobs

Hosting a party is fun; cleaning up after one, not as much.  Consider adding event house cleanup to your cleaning service roster.

Event cleanup involves cleaning up the mess left from an event and getting the home back in tip-top shape.

Pricing for this type of residential house cleaning service can be both hourly rate or a pre-determined flat rate.

Green cleaning jobs

We don’t suggest following all trends for your new business, but offering eco-friendly cleaning services, is a piece of the pie you’ll want to sink your teeth into.

Customers and potential customers today are more concerned with the ingredients in cleaning supplies and the effect those ingredients have on the environment and their own health.

This is especially important in residential cleaning services, where people spend most of their time.

In fact, a recent survey showed that approximately 18 percent of respondents stated they would spend up to 10% more on environmentally friendly cleaning products.

You will have a distinct advantage by offering your potential customers and customers something that your competitors aren’t:  toxin-free cleanliness.

Eco-friendly cleaning is especially desirable for parents who might worry about the chemicals their young children are around, people with allergies or respiratory issues, or even your regular Joe, who is pretty sure breathing in bleach isn’t the best idea.

Use this to your advantage.

Green cleaning can be a business model you follow for all cleaning jobs or an upgrade cleaning service that your client can add on.

Commercial cleaning business

Commercial cleaning companies offer commercial cleaning services that cater to businesses.

Regardless of the type of business, it is important to maintain cleanliness in our work and business environments.

Whether maintaining an office building, disposing of hazardous waste, or window washing an 87 story building– there is a large market for commercial cleaners.

Unlike residential cleaning services, which are often priced by the hour, pricing for commercial cleaning jobs is generally based upon a contract price.

Consider these four types of cleaning services when starting yours.

General office cleaning jobs

Office buildings are the start of transactions, collaboration, and client interaction.

It is vital to keep them clean and prepared to handle day-to-day business.

Business owners want to impress customers and potential customers and maintain property values, so they will hire you to maintain their offices’ cleanliness.

General office cleaning contracts often include janitorial services like mopping and vacuuming, carpet and window cleaning, removing trash, waxing floors, dusting, and sanitizing bathrooms. And for such jobs, you’ll need to provide all cleaning chemicals and supplies.

Large scale niche services cleaning jobs

Some commercial cleaning businesses offer large job services that go beyond office cleaning. Those jobs include window and carpet cleaning, among other cleaning services.

These specialized jobs require specific cleaning equipment and skills. You’ll want to keep this in mind while calculating start-up costs and operating costs.

Commercial window cleaning has an average cost of $5-$14 per hour, while commercial carpet cleaners charge between $30 and $70 per room.

Construction cleanup jobs

Construction site cleanup services perform a final cleaning and removal of construction materials. This type of cleanup is needed in both commercial and residential properties.

Take note that construction cleanup businesses require a variety of licenses and permits for the services they offer.

This type of work requires long hours and specialized cleaning equipment (again – an added start-up expense).

Typical customers include contractors, construction companies, and property management firms.

Disaster and hazardous waste cleanup jobs

Disaster and hazardous waste cleanup are less familiar but certainly necessary sectors of commercial cleaning. The cleaning companies in this niche are highly specialized and trained.

These services may be required after natural disasters, in the medical field, or even surrounding crime scenes.

Commercial companies offering this type of cleaning service must work closely with EPA and OSHA guidelines.

Franchise or independent business?

Whether you’re thinking about starting a residential cleaning business or a commercial cleaning business, you’ll need to decide if you want to start an independent cleaning service or join an established franchise.

Franchises can give cleaning business owners a quick advantage because their name is more likely to be recognized in the industry, they’ll often have national advertising or regional advertising focusing on the brand, and they’ll teach you how to run your own cleaning service.

Franchises may be an easier way to get started when you’re looking to provide commercial cleaning because businesses will carefully consider your reputation and the reputation of your business. If a commercial cleaning franchise has already established a strong reputation in the market, that can help you find potential customers more quickly and get started quickly as a business owner.

For some cleaning business owners, the advantages of a franchise agreement are quickly outweighed by the disadvantages, even in commercial cleaning.

In the long run, you’ll likely invest less money when you start a cleaning business of your own as an independent business. And, as an independent cleaning business, you’re not tied to pre-established requirements for the concept, name, the services you must offer, and the specific processes you must follow.

So, you can do things your way, but you’ll need to define your market and figure out all of the things involved with running and growing a successful cleaning business, especially in commercial cleaning.

Defining your business action items:

☐ Determine if you are opening a residential cleaning business or commercial cleaning business.
☐ Research the requirements of services you are contemplating offering.
☐ Decide on a niche for your cleaning business (you should pick a niche even if you pick residential cleaning).

People make many mistakes when they start a cleaning business and rush into things before considering the important aspects of their business. Although writing a business plan isn’t mandatory for a cleaning business, it can help you crystallize your ideas and avoid many mistakes.

Studies show that entrepreneurs who take the time to write a business plan when starting a cleaning business (and other types of businesses) are 2.5 times more likely to follow through and get their business off the ground. The work that goes into creating a business plan also helps new entrepreneurs build skills that will be invaluable later.

For insights and free downloadable business plan templates, read this definitive guide on how to write a business plan. And if your time is limited, read the section of that guide on how to write a one page business plan. Several excellent one-page business plan frameworks can help you put together a quick, actionable plan to start a cleaning business of your own.

Finally, take a look at these ten business plan tips on writing a great business plan.

Don’t make price your main criteria for hiring a lawyer.

Often, the least expensive lawyers are also less experienced – especially in the areas where you may need help. Paying a cheaper hourly rate might feel good initially, but in the end, you may end up paying far more than if you hired an experienced (more expensive) business lawyer in the first place.

Make sure your lawyer is familiar with the peculiarities of a cleaning business, has experience with clients who start a cleaning business and has represented other cleaning businesses and other small businesses.

Also – be clear about your budget and expectations. Your lawyer should understand that your budget is limited and that they should not waste that budget on irrelevant details.

Typically, the best time to start a relationship with a lawyer is before you start your cleaning company.

Too many people make the mistake of forming a company without consulting a lawyer. A good lawyer will help you find the right business structure for the business – and split ownership interests if you have co-owners – in ways that will protect everyone and give you flexibility going forward.

Spend some time reading about each possible entity your cleaning business might fit into. Consider which business structure is most helpful when you start a cleaning business and how each business structure can help you accomplish your professional and personal goals.

Be sure to look at which entity will work best for your cleaning company while still considering any future business goals.

Also, remember that when starting a cleaning company, most states require you to register your cleaning business (for house cleaning and/or commercial cleaning services), before you take on cleaning jobs, with the secretary of state or county clerk in the county in which you operate your business if the trade name under which you operate your business differs from the legal business name of your business.

Fortunately, this is not a difficult problem to overcome. You can simply register your actual trade name with your state (and or local government) by filing a “doing business as” (DBA) certificate. DBAs are also commonly called “assumed name,” “fictitious business name,” or “trade name.” Here’s a terrific resource that explains what a DBA is, the DBA state requirements, and how to file a DBA for your business in all 50 states and U.S. territories.

Business accounting is how your business records, organizes, interprets, and presents its financial information. Accountants analyze the financial condition of a business to help the business owner make better decisions.

Bookkeeping is the recording, organization, storage, and retrieval of financial information related to your business.

The main difference between the two is that bookkeeping is how you record and categorize financial information, whereas accounting puts the information to use through analysis, strategy, and tax planning.

Many small businesses will use an outside bookkeeper, paid hourly to handle all entries, pay all the bills, and manage invoicing and receivables. Having help with this aspect of managing a small company can be indispensable, and the time it can free for a busy owner, invaluable.

Business finance uses your company’s financial information to help you manage your money and make your cleaning business operations profitable and sustainable.

You have many business financing options.

These include using your own resources and assets, borrowing money from friends and family, finding business partners, applying for financing or grants through government programs, and more.

Business financing is important because you need to determine how you’re going to fund your new business and how you’ll grow it. And you’ll need to put together a cleaning business budget.

If you don’t understand the numbers, you’ll have a tough time building a sustainable, profitable business.

Be extra careful to conserve your funds when starting a cleaning business. Don’t overspend.

Some purchases will be necessary and will make sense for your cleaning business, but others, like expensive and unnecessary equipment or a fancy car, will threaten your small business’s survivability.

Your brand and brand identity should be unique.

You may find yourself thinking, “I’m just cleaning houses. Do I really need to worry about branding?” But, the clear answer is yes.

Whether you are intentional about your branding or not, your brand exists. And your brand is much bigger than your brand name.

Making deliberate branding decisions for your cleaning business will give you a leg up on the competition.

Cleaning professionals, especially residential cleaners, are invited into the most sacred place in a consumer’s world – their home. Ensure your brand embodies trustworthiness in addition to quality to gain a client’s trust. And be committed to that message.

WHICH LOGO IS BEST?

Before you start posting ads for your cleaning services, consider the following:

• What makes my cleaning business unique?
• What type of cleaning business am I?
• What cleaning services will I offer?
• Who are my customers?
• What are my brand values?
• What is the most important part of my customers’ experience?
  

Your answers to these questions will help build the foundation of your brand.

Once those are set, you’re ready to think about your business name and company logo – the core branding elements for your business. 

For help with branding, read the definitive guide on building a brand identity. It’s 21,000+ words, and it’s filled with actionable insights and tips on choosing a business name, finding a great and unique company logo, and much more. That guide contains everything you need to build a strong and sustainable business.

Before you decide that you should delay building a strong brand identity because you might not yet have a huge budget, rethink that plan. You don’t have to spend thousands of dollars on building a strong brand identity. Here are a few pricing guides that can help you identify the sweet spot for pricing:

And if you’ve already started your cleaning business but are struggling to grow it, consider whether rebranding can help you put your existing business on a path to success.

Branding to do:

☐ Develop your brand identity, including your brand name, logo, and website.
☐ Name your business.
☐ Hire an experienced logo designer to create your company logo.

Cleaning services tend to have some of the lowest up-front costs compared to other start-ups. When you put together your cleaning business budget, consider these costs:

Start-up costs

Start-up costs for a cleaning business include:

• registering your business (discussed above)
• buying business insurance
• tools and cleaning supplies, as well as cleaning chemicals and cleaning solutions
• transportation
• branding and promotional tools

Buying business insurance

It’s alarming how many new cleaning business owners forget to protect themselves and their businesses via insurance before they officially start.

Acquiring business insurance won’t help you after claims against your business have already been filed.

It’s alarming how many guides on starting a cleaning business ignore the importance of business insurance (including liability insurance).

As we shared in our guide on how to start a business,

Insurance can cover property damage, theft, intellectual property lawsuits, and other incidents. Those can be very costly to small businesses and you need to properly protect yourself and your new business.

And if you will employ people, you’ll need to have workers’ compensation and unemployment insurance. Coverage varies by location, and many general liability (GL) policies will cover at least workers’ compensation.

If you provide services, you’ll want to have professional liability insurance so that you’re protected against possible claims.

Here’s a good read on the different types of insurance you should consider as a business owner.

Tools and cleaning supplies

The volume of cleaning supplies needed for your cleaning business will depend entirely on the services you offer and how many clients you have to start.

In general, you’ll need basic cleaning supplies and tools such as sponges, disinfectants, paper towels, mops, etc.

When you’re just starting, you can use products found in your home. However, once you’ve established a larger clientele, you may want to begin purchasing cleaning supplies at bulk retailers like Sam’s Club or Costco. Once your business has really taken off, it’s time to consider wholesale vendors as well.

You will also likely require vacuums and steam mops.  On average, $500-$800 should be enough to get you started.

Transportation

Transportation is essential to any mobile business, like a cleaning business. Before starting a job, you have to get there first.

Ensure you have reliable transportation that will easily fit your cleaning supplies and tools.

And, don’t forget the importance of getting there on time!

Branding and promotional tools

Building up your client list is one of the bigger challenges in your new cleaning business. After all, you need clients to have a successful business.

As we emphasized earlier, branding is not a place to cut corners.

Once you’ve established your brand’s core, work with professionals to get a brand name, logo, and website design that will serve your business well.

Setting your prices

You’ll want to research your local market carefully. Cleaning prices for Manhattan can be substantially different from cleaning prices in Kansas.

The three most common pricing models for cleaning businesses are per hour, per job type, and long-term contract.

To develop your pricing guidelines, consider the profit margin you are trying to achieve. Then keep that in mind when setting your overall prices and your core business model.

Determine your operating costs and expenses per job (don’t forget travel, cleaning supplies such as paper towels and rags, and labor!). Then factor in the amount of profit you want to make for each job. This is the amount you should charge.

Do some market research to see how your pricing structure and business model compares to that of local competitors and adjust your pricing accordingly. This doesn’t mean that your prices should be the same. Maybe your service offers a higher (or more economical) level of service.

But, it’s important to check that your services are priced fairly for your market. Your customers certainly will.

Hourly

The average hourly rate for professional house cleaning services in the U.S. is anywhere between $25-$45 an hour. Before deciding on an hourly rate, you should consider:

• Job location: Decide on a geographical radius you are willing to travel for the hourly rate.  If you are willing to travel outside of that radius, you’ll want to add extended travel fees.
• Cost and profit margin: When deciding what to charge per hour, consider the costs (travel and cleaning supplies) and the profit margin you hope to achieve per hour.
• Hourly minimums: It’s common practice to enforce minimum hours charged for a job. For instance, consider a 2-hour minimum commitment per job. This ensures that you’re getting paid an amount that is worth your time and effort.
• Tiered per-hour pricing: You may consider a tiered pricing schedule for long-term contracts.  If a client is willing to sign a long-term commitment to your services (i.e., 2 hours of cleaning/week for 3 months), granting them a price break (per hour) can be an excellent way to retain that client and ensure consistent workflow. Commercial clients can particularly welcome this.

Flat rate by job type

Charging a flat rate fee based on job type (i.e., house cleaning, office building, construction site cleanup) is another way to set up your pricing structure.

You’ll want to calculate the hours required to complete the job before quoting a price.

When opting for a flat rate structure, consider the following:

• Size of the area to be cleaned: This factor will vary for each job. And, it’s an essential consideration when deciding costs. After all, an 800 square-foot home can be cleaned in fewer hours than a 3000 square foot residence. Likewise, if you are contracted to only clean bathrooms in an office building, less time is required than cleaning several complete floors with bathrooms, kitchens, and offices.
• Location of job: Decide on a geographical radius you’re willing to travel within. If you are asked to travel outside of that radius, add extended travel fees to cover your additional time, effort, and expense.
• The intensity of job: Maintaining a home on a weekly or biweekly basis requires fewer hours of cleaning than a home that is very messy or needs a deep clean (which is more thorough and requires more cleaning supplies).  Deep cleaning will cost more compared to basic maintenance cleaning. You’ll need more paper towels, more cleaning solutions, more rags. More of everything.
• Frequency: Consider a pricing break on jobs with a higher frequency.  For example, offer a pricing tier on home cleaning 1x/month, 2x/month, and weekly.

Term contract

While less common for small businesses, charging for a term contract is another viable option.

Term contract pricing involves a client agreeing to pay for your services for X period of time, with the expectation of X cleaning appointments during that time. This is very popular with commercial clients who need their professional buildings maintained.

While determining the pricing structure for term contracts, consider:

• Contract length: How long is the contract for? Will you offer a price reduction for longer contracts?
• Location: Decide on a geographical radius you are willing to travel for the contract.  If you agree to travel outside of that radius, add on extended travel fees.
• Frequency: How often will services be rendered?
• Size of job: How large is the job/and or building that requires your services? Will you need to hire additional employees or buy extra cleaning supplies to complete the job?

When planning an effective pricing strategy, you have to know how much it will cost you to provide service, what the current market pricing looks like, and what profit margin you are trying to achieve.

Your prospects are shopping around.  They’re checking out your services and your competitors.  That’s why you need to know what your competitors are charging.

It is also important to note that perceived value – what a customer thinks your services are worth, is a big piece of the puzzle. And, your branding will play a large role in determining how your clients perceive your business.

A word about payment methods

I think we can all agree that getting paid is an essential part of any business.

It’s smart to offer your clients payment options.

You may consider offering the following:

• Cash: Cash may no longer be king, but plenty of customers will still want to pay for services this way.
• Check: About 20% of U.S. consumers use checks.  Proceed with caution. While most transactions may go off without a hitch, you do risk canceled and returned checks.
• Credit Cards: It is common, particularly with contracts to keep a credit card on file with planned charges. You may also consider using services such as Paypal, Venmo, and Square to collect credit card payments.

Financial action items:

☐ Calculate startup costs (registration, insurance (including liability insurance), tools and cleaning supplies, transportation, and branding).
☐ Research pricing structures and desired profit margins.
☐ Determine your pricing.
☐ Set up payment methods.

Legal considerations

As we mentioned above, every business must choose a legal structure.

Once you’ve decided which entity would be the best fit for you, the next step is to register with the government (each state has its own set of rules regarding new businesses) and the IRS.

You can find a full list of the forms for each type of entity on the Small Business Administration’s website. You can also find state-specific tax obligations on the same site.

The SBA tells us that some form of business license or permit is necessary for virtually every type of business. You can find all the info you need regarding business licenses or permits needed on their website.

For more details about legal considerations for your cleaning business, read this article by NOLO’s contributing author David Steingold.

Location considerations

Many cleaning businesses can be based out of your home. Your customers and prospective customers will likely never come to your facility or office because all cleaning work is done on their premises.

But, carefully check your local regulations and requirements. Some municipalities and many homeowners’ associations limit the types of businesses that can be run from your home. This is especially relevant if your cleaning business will need signage, employees, or commercial vehicles. Before you decide on a location, find out what your homeowner’s association and local ordinances permit and prohibit in connection with home-based businesses.

If it’s difficult to run your cleaning business from your home, consider opening a commercial location.

A commercial location for a cleaning business does help you build a more successful and professional image. But, be sure you get a commercial location with a large enough office that has space for you, the administrative team, and any employees that will work out of your commercial location. Also, be sure that you have a storage area for the equipment and supplies you’ll need in your cleaning business.

And, you should dedicate some space for laundry and work are to repair equipment. Both are necessary to the successful operation of a cleaning business, and you’ll save a lot of money doing both laundry and small repairs in-house.

Finally, consider what vehicles you’ll need and where you’ll park them. Because all of the cleaning work is done on a customer’s premises, vehicles are important. They should be selected carefully to meet your needs and require minimal maintenance.

For maid service cleaning businesses, an economy car, a minivan, or a station wagon will be perfect. You need room to store supplies and equipment and to transport your cleaning teams. And, since maid service doesn’t need large equipment, you don’t need large vans.

But, for certain types of cleaning services, like carpet cleaning, you’ll need a truck or van. You’ll need to carry larger equipment and, therefore, must purchase larger vehicles.

Fortunately, you can buy good used trucks for $8,000 to $12,000 and don’t need to invest in new trucks. So, even though a truck can add a substantial cost, it’s still far less expensive than if you were starting a trucking company that focuses on long-haul or short-haul deliveries and transport.

Finally, remember that whether you use your own vehicles or have your cleaning team use theirs, get vehicle wraps or magnetic signs that you can put on all vehicles to advertise your business. And be sure that the vehicles – your own and any used by your cleaning crews – are properly insured for business use.

Safety considerations

Cleaning offices or homes may not be the most dangerous activity, but you could be working with toxic cleaning supplies. And, if you take on a medical cleaning contract, you may find yourself exposed to other dangers.

The Occupational Safety & Health Administration (OSHA) has a variety of regulations relating to, among other things, eye and face protection, hand and foot protection, toxic and hazardous substances, and ventilation. For more details on federal safety and health rules, check the OSHA website’s cleaning industry section.

Fill in the blanks to do:

☐ Choose a legal structure for your business.
☐ Visit the U.S. Small Business Administration website for the required forms, permits, and business licenses.
☐ Research additional legal considerations.
☐ Visit the OSHA website for up-to-date safety regulations.

Your cleaning business needs a website.

In fact, most people prefer the convenience of researching your business via the web over talking to anyone on the phone or in person.

A business website will give your business credibility, serve as a 24-hour ambassador even when you’re unavailable, and can even tackle some vital tasks like setting appointments and making sales.

You may feel overwhelmed at the idea or question if you have the budget for a website, but the reality is: your business can’t afford not to. 

To dig deeper, take a look at the step-by-step, easy-to-follow instructions on creating a small business website.

Suggestions to get the most from your website:

Your website must be consistent with your brand, what you represent, and offer. This consistency is key to building trust, recognition, and customer loyalty.

Create brand consistency on your website by…

• Featuring your business name, logo, and tagline prominently.
• Using the same brand colors from your logo to create visual coherence.
• Offering an “About Us” page introducing prospects to you and your business.
• Including a “Services” page highlighting the services you offer.
• Featuring a “Contact Us” page that is easily accessible from everywhere on your website.
• Providing links to your social media accounts.