Diversification is one of those growth strategies that just makes sense for a building service contractor (BSC).
If done right, it can be a low-cost way to boost your revenue.
The easiest sell any sales person can make is to a relationship that is already developed.
The customer already trusts you and your company's services.
When I think of sales revenue, I think of the five factors that make up your revenue and profit for a customer in any given year:
- Number of leads
- Conversion rate
- Average dollar sale
- Number of transactions
- Profit margin.
When we are talking about diversification, we are talking about the fourth factor used to boost revenue: Number of transactions.
We are talking about ways to increase the number of transactions or times that your customer buys from you.
This, then, increases the overall value of a customer for a given year.
An example of this would be along the lines of the following: Your customer, ABC Widgets, currently has a cleaning schedule of a monthly office cleaning — 12 cleanings in a given year.
For easy math, let's say that each cleaning was $100, making your current value of that customer $1,200 a year.
Now, let's say you added a monthly window cleaning at $50 per cleaning.
This would double the number of transactions and would add another $600, making the total value of that customer now $1,800.
When used properly, the number of transactions can be a very valuable tool to help increase revenue.
Why Window Cleaning?
Simply put, there is a good return on investment (ROI).
The cost of tools and equipment can be minimal, and the need is already there.
Windows, fortunately, keep getting dirty, leading to a high-frequency service plan.
A typical service plan for an office building may be the interior/exterior of the entrances monthly and the interior/exterior of the building seasonally — in spring/fall or summer/winter.
My golden rule in business is: Find the repeat business and you will find the profits.
As a BSC, I am sure you are already aware of that.
The advantages of offering window cleaning as an add-on include:
- Increased revenue. This is done by increasing the value of your current customer.
- Low start-up cost. The cost of the equipment for one technician is under $200.
- Quick learning curve. Training your technicians is easy to do, and if you have a good employee who is a quick learner, I would expect them to have the basic skills down in two days.
- Repeat business. In regards to scheduling, set it and forget it.
Subcontracting Window Cleaning
The biggest advantage of subcontracting your window cleaning is the insurance costs, depending on your state and the workers' compensation laws.
The workers' compensation rates in most states can be very high and quite expensive.
If you are just starting out, subcontracting the window cleaning can be a wise strategy to test the waters and see if your customers are interested in buying window cleaning from you.
Also, the scheduling of exterior window cleaning services can be very frustrating.
Scheduling this work around the 10-day weather forecast is an art form that you may not be interested in learning.
Use your current management criteria when delegating this responsibility to a new subcontractor.
Whenever I delegate responsibility, it is important that I start small and build.
Let your new subcontractor show you that they are able to handle the smaller jobs before you give them the larger ones.
Always get an updated certificate of insurance and make sure the subcontractor's insurance meets the insurance requirements that your customer has.
Go get lunch with your prospective subcontractor; get to know them and make sure they have the same business values as you do.
Your first step to getting the ball rolling and adding window cleaning services to your operations is to start selling window cleaning.
Some low-cost ways to start selling window cleaning services are:
- Add it to your e-mail signature
- Add it to your vehicle signage
- Add it to your current marketing documents and use it as an insert in your current brochure
- Add it to your sales process, and every time you visit a prospective customer's property, make sure to include the window cleaning price with your janitorial cleaning bid.
Whether you decide to start an in-house window cleaning division or you decide to subcontract your window cleaning services, taking action and selling window cleaning services are your first steps toward additional revenue.
Jason Vance has been in the cleaning business for 20 years. He owns and operates www.WindowBrothers.com, a commercial and residential window cleaning company in Milwaukee, Wisconsin. Jason strongly believes in the benefits of business coaching. He has a great time helping business owners learn to make a lot more money, get highly organized and, in the process, become successful entrepreneurs. Get a copy of his free report, "How to Increase Profits for your Seasonal Business in 3 Free Steps," at www.JasonVance.biz.