Cleaning Industry Analysis 2017 - Cost & Trends

From where I’m sitting I can see at least a dozen things that need a regular cleaning – windows, desks, carpets, trash bins; a kitchenette with a tile floor, appliances, and dishes; a lounge with upholstered furniture, lamps, hardwood floors, etc. And if I was home I can assure you the whole place could use a once over.

Lucky for me there are cleaning businesses aplenty that are looking to scour offices, houses, storefronts, medical facilities, schools, warehouses and more. The cleaning industry is diverse - some businesses focus on specialty cleaning such as windows or floors, others on general residential or commercial cleaning and yet more on laundry and dry cleaning services.

Franchise businesses only account for about 10% of industry revenue – but opportunities still abound for the interested entrepreneur across all sectors.

Industry Description

The cleaning industry can be roughly divided into residential cleaning, commercial janitorial services, specialty cleaning and laundry/dry cleaning services. In 2015 there were approximately 875,000 businesses employing about 3.5 million people.

The industry as a whole is very susceptible to economic downturns and suffered through several rough years during theGreat Recession; revenue fell 5.3% in 2008 and another 6.1% in 2009. General cleaning services, and particularly residential services, are deemed an expendable luxury when times are tough.

However the years of economic strength since then have seen the industry bounce back, and in 2015 it generated $51 billion in revenue. This recent upward momentum can be attributed to both unemployment and office vacancy rates declining as well as a pickup in nonresidential construction activity. In other words – people have more money to spend and feel more secure spending it, and there are more offices that need cleaning.

Strong economic activity is forecast for the next 5 years as well, and theBureau of Labor Statistics is predicting job growth of about 6% from 2014 levels to 2020.

Business Risk

It is estimated that the average cleaning company loses up to 55% of their customer base every year due to poor service. As one business owner states – good work goes unnoticed for years, but a bad job gets you fired immediately.

Competition is fierce – there are many small companies competing for both residential and commercial cleaning contracts. Barriers to entry are low as there is very little expensive equipment needed and little to no training required for employees – so new competitors spring up all the time.

For dry cleaning and some specialty cleaning services, however, expensive equipment actually can be a significant hurdle, including needing commercial or industrial real estate to sell and perform services.

Read more here: https://www.franchisehelp.com/industry-reports/cleaning-industry-report/