Do You Need a Cleaning Business Plan? (One Page Is Enough)

Sandra ran her cleaning business in North Carolina to between $15,000 and $20,000 a month. Before that she spent 15 years in finance at Merrill and Wells Fargo. When she and her business partner started out, they did what finance people do. They sat down to write a business plan.

"Who gets past the business plan? Very few. It is so overwhelming. It's tedious. And then you're like, oh, I have to make a profit, I have to show this and I have to show that, and then you just don't." Sandra, Maid Knows Best

She is not against planning. She is describing the thing that happens to most people who set out to write a formal plan for a business that does not need one: they never launch.

The short answer

• If you are bootstrapping a residential cleaning company: you do not need a formal business plan. You need a page, and then you need clients.
• If you are applying for a bank loan or a grant: you need a proper plan, because the lender requires it. Write it because they asked, not because the business needs it.
• If you are bidding on public contracts: you will need documentation, but that comes later, once you are trading.

Why the traditional plan does not fit this business

A business plan is a tool for convincing someone to give you money. It projects revenue, models costs, and proves you have thought it through, because a stranger is being asked to take a risk on you.

In a cleaning company there is no stranger, because there is nothing to fund.

You are not buying premises. You are not buying vehicles. Your cleaners are independent contractors who bring their own supplies. Jake and Emmy in Dubuque worked out that without a commercial contract they took on early, they could have started for about $2,000.

The only thing your plan needs to prove is that bookings come in, cleaners go out, and money lands in the bank. You find that out by taking a booking, not by modelling it in a spreadsheet.

The one-page cleaning business plan

Write these nine lines. It will take you an afternoon and it will be more useful than a document nobody reads.

That is your plan. If you cannot fill in line 3 or line 4, that is a gap and worth an hour of thought. If you can fill in all nine, stop planning and go take a booking.

Line 3 is the one worth agonising over

If any line deserves more than a sentence, it is the ideal client.

John in Austin built his whole business around a specific person. He and his wife have two young children, they own a home, and their house is a wreck. So they targeted working parents with young kids, earning over $100,000, who would rather pay someone than lose their Saturday.

"At the end of the day the kids are finally in bed, it's 8pm, and my wife and I sit down and feel like we've gone to war. Who has time to clean? That's the community we wanted to go after." John, Swept Up

Every ad, every page, every word on his site is written for that person. He did $450,000 in his first year.

Jen and I ask a simpler version of the same question: would this give us predictable income and predictable days? That question is worth more than a revenue projection.

What about financial projections?

You can build one in five minutes, because the model is arithmetic.

Decide your average job price. Decide how many recurring clients you want. Multiply. Around 100 recurring clients produces roughly half a million a year in billings. Take 60% off the top for your cleaners. What is left covers your software, insurance and marketing, and the rest is yours.

Profit margins in our community sit between 26% and 40%. Ours are 26 to 28% because we pay our cleaners well. Daniel runs 40%. John runs 33% net.

That is your projection. It fits in a text message.

When you do need a full plan

Write the full document when someone is going to read it and make a decision based on it:

• A bank loan or overdraft. They will want projections, and you should meet them where they are.
• A grant or startup programme. Same. The plan is the price of entry.
• Government and public contracts. Darren is pursuing MBE certification for public work, and that world runs on paperwork.
• A business partner. Not for the bank, for the two of you. Who does what, who owns what, and what happens if one of you wants out. That is the document worth writing.

Sandra's business partner left two years in. Jen and I have been clear from the start about who runs which half. That conversation matters far more than a market analysis section.

The thing a plan cannot give you

The people who succeed in this industry are not the ones with the best plan. Every owner we have interviewed followed a model somebody else had already proven, and the ones who struggled were mostly the ones who tried to improve on it before they had run it once.

Sandra's own verdict, after fifteen years in finance and a rebuild of her own business:

"This has already been tested. You don't go try to make your own vaccines. It's already tested, it already works. He gave you the road map, and if you follow it, it works." Sandra

Write the page. Take the booking. Figure out the rest as it comes.

Frequently asked questions

Do I need a business plan to start a cleaning business?

Not a formal one, unless someone is going to read it and make a decision, like a bank or a grant panel. There is nothing to fund: no premises, no vehicles, and your cleaners bring their own supplies. A one-page plan and a booking will teach you more than a 30-page document.

What should a cleaning business plan include?

Nine lines: your name (location plus keyword), your city and neighbourhoods, your ideal client in one sentence, your services and flat prices, whether cleaners are contractors or employees and their split, your first three marketing channels, how you take payment, your startup and monthly costs, and the target number of recurring clients.

How do I write financial projections for a cleaning business?

It is arithmetic. Take your average job price, multiply by the recurring clients you want, and subtract the cleaner's share. About 100 recurring clients produces roughly half a million a year in billings. Margins in our community run 26% to 40%, depending on how well you pay your cleaners.

How much does it cost to start a cleaning business?

Under $2,000 in most cases. Jake and Emmy in Dubuque worked out that without an early commercial contract, they could have started for about $2,000. Your main costs are booking software, insurance and a phone number, because contractors bring their own supplies.

What is the most important part of a cleaning business plan?

Your ideal client. John in Austin built everything around working parents with young kids earning over $100,000, and did $450,000 in his first year. Every ad and every page was written for that one person. A vague answer here makes everything else vague.

When do I need a formal business plan?

For a bank loan, a grant or startup programme, public or government contracts, or when you have a business partner. That last one is for the two of you, not the bank: who does what, who owns what, and what happens if one of you wants out.