Janitorial Bidding - How to Bid and Price Cleaning Jobs & Contracts
"Our experience with this business has been excellent. We were lucky to have been able to get a $700 contract where one of our neighbors works almost immediately after we got our company started. We told them what you recommended, that our company was brand new and we wanted to develop some very happy customers that we will be able to use as references down the road, and they gave us the contract. Neither I or my wife have ever had any experience running a business, but that has not seemed to matter because you have shown us that we just need to be ourselves and do the right thing for people. We started our company in July and now have $2510 a month in business. Thank you so much for putting this together." Evan R., Hamilton, MI* More Testimonials
< You Have the Advantage!
You have the advantage because you can tap into 35 years of bidding experience.
Figuring cleaning bids and prices can be a tough thing to learn on your own, and it takes practice. If you do it wrong too many times, it might be a while before you start making money - and who needs that?
I've been through the "learning how to bid" wars, and you can benefit from it. The Sales and Bidding Section in the book is 71 pages long.
In the package, I break down a dozen of my own accounts, from 18,000 square feet to my largest account, 216,000 square feet. I describe them in detail - how many desks, how many restrooms, what types of flooring, people-per-square-foot and square-feet-per-person. How long it takes to do each task (I've been timing various tasks for years to help me with my bidding). I give you about a dozen equations you can use to "back up" into a price, checking your numbers against all kinds of benchmarks. You can learn a lot by studying these breakdowns - this is an insight into another person's real business, and I've never seen that in any other "start a cleaning business" book.
Here's a sample breakdown:
Sample Account #6 – 3-story, Multi-Tenant Class B+ Office Building
39,000 sq.ft. (3 story, 13,000 sq.ft. per floor), 10 suites, all paper-pushers (lawyers, CPA’s, mortgage, and insurance). We charge 9 cents per sq.ft. for $3510 per month. Very clean, in a good part of town, on the very end of a business park so there's very little traffic going by.
The tenants are fairly high-end, so they have lots of square feet for very few people. 100 people in 39,000 sq.ft. = 390 sq.ft. per person.
Remember that multi-tenant buildings have multiple suites, so they all have their own lobbies, whereas a single-tenant building of the same size would have just one lobby. Lobbies are easy money, fast and easy to clean. This is a consideration that I think most other bidders don't even realize.
The 120 exterior windows are floor-to-ceiling, so there's extra time involved to dust the sills, especially where people have put their desks right in front of a window. Add 1 minute per sill, once per month = 2 hours.
Top floor has 5 tenants, the second floor has 3 tenants, and the first floor has 2 large tenants. All floors have 2 restrooms.
Each floor takes 1.5 hours, for a total of 4.5 hours per night.
4.5 hours x 21 nights per month = 94.5 hours per month. Let’s round it off to 100 hours per month, because there's about 6 hours of tile-floor buffing per month.
$3510 divided by 100 hours = $35.10 per hour! Yes!
$3510 divided by 100 occupants = $35.10 per person.
100 hours x $12.50 wage and tax expenses = $1250 per month labor cost.
The customer wanted us to furnish restroom supplies as part of our bid - figure $2 per person x 100 people = $200 per month for supplies. Add in the fact that these tenants are the type of companies that have a fair amount of walk-in traffic, so in my bid I figured an extra $100 per month for supplies. Visitors use restrooms, too. Total supply cost is $300 per month.
$1250 labor + $300 in supplies = $1550 per month in expenses, leaving us with a profit of $1960 per month. That’s a 58% profit.
End of sample account breakdown.
Notice there are things here that I see that a lot of other bidders don't take into consideration, such as lots of individual lobbies and the floor-to-ceiling windows. Other bidders don't see things like this because many of your competitors have never swung a mop. Most janitorial salesmen take the square footage and the population of the building and the number of restrooms, and then they multiply it by a certain cents-per-square-foot, and that's it. They don't come anywhere near what I take into account. When I see something that I think the other contractors might have missed, such as the lobbies and the window sills, I let the customer know about that "something" in the letter that I include with my bid. Any little thing that I can throw in to show them that I'm a little sharper than the other bidders, I write it in.
I've seen other contractor's bid letters, and they basically thank the customer for the opportunity, tell the customer they should call if they have questions, and then they sign it. My bid letters, on the other hand, explain everything. My bid letter on one building was 7 pages long, and when the customer called me to say that I had won the contract, his very first comment was, "Well, you weren't the lowest bidder, but you obviously have the whole situation very well thought out, and that's one of the big reasons we're hiring you. We honestly had no questions to ask after we finished reading your letter."
These breakdowns help you to recognize and understand what makes a building easier or harder or faster or slower to clean than others.
I also explain my system of Team Bidding. As far as I know, I invented it, 20 years ago. It's the exact opposite of what you would think is "the best way to do it". It has a "twist" to it that is totally contrary to what others do. We have landed virtually all of our largest accounts using Team Bidding, and now you can do it too.
Now that my business is getting about as big as I want it to get, I'm really particular about the buildings that I will bid on (I turn down about 95% of all invitations to bid), but ever since we started using Team Bidding, our sign-up rate has gone up to about 50% of the buildings we bid on, compared to 25% before we started using it.
Just so you know, a 50% sign-up rate is extremely high. We have one competitor who seems to get invited to many of the same buildings that we are invited to, and now, when he sees us walk in the door, he says to the other bidders "Well, you guys, we almost might as well go home".
Team Bidding is another Sales Magnet tool - in your cover letters that you submit with your bids you can explain the Team Bidding process to your prospects, and it's just another way that you'll set your company apart from your competition.
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Note: If you live in Western Washington State, or own a janitorial service in Western Washington State, or if you plan to establish a janitorial business in Western Washington State, or if you are a franchisor or franchisee doing business anywhere in North America, or if you operate or plan to operate a business that sells business products or services such as my company does, no matter where that business may be located, I'm sorry, but this package is not available to you. I tell so much about my own cleaning business in this package that I would be creating my own competition if I let you use this information. The purchase agreement spells this out very clearly, and violating that agreement will result in legal actions.
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