Post Construction Cleanup – Scalable w/Fantastic Expansion Potential!
This specialty maintenance firm has provided post-construction cleaning services to general contractors (60%-70% of the business), architects and upscale homeowners in the greater Los Angeles area for over 12 years. The company has completed over 2,500 projects to date by utilizing independent contractors that are specialists in their respective arenas that include general cleaning, window washing, power washing and more. Given their history and reputation, the majority of the company’s business is now recurring and referral based, though they do participate in some general marketing and Google pay-per-click ad campaigns. Since their typical end-user is a 4,000 square foot high-end homeowner (with a significant number 10k+ square foot homeowners) doing construction or remodeling, the company finds that they are not particularly susceptible to economic downturns. The firm also engaged in commercial jobs for small to medium rise multi-unit buildings (one with 100 apartment units) as we well as new restaurants, which account for an estimated 5 jobs per annum. The average ticket for a home and window cleaning job is $3,500.
This highly efficient operation is home-based and does not employ any regular W2 employees. Rather, the company a number of independent contractors with their own specialty companies on an as-needed basis and coordinates them to work in concert with one another. As a result of this set-up, coupled with an offshore sales coordinator, the company has been able to minimize their administrative footprint and expense structure while maximizing their flexibility. The independent contractors manage their own staff, insurance, taxes and liability insurance, while the Sales Coordinator covers customer service functions that include customer liaising, lead follow-up, estimating, scheduling and billing. 50% deposits are paid with balances paid on completion.
Competition exists in the general construction and remodeling clean-up segment, as well as in window and power washing and general cleaning functions. This company occupies a niche that is more advanced than home cleaning, but less complicated than heavy duty construction clean-up that may require tractors, dump trucks, hauling permits and contractor licensing.
Growth & Expansion
New management may grow this company in any number of ways. While they may increase their geographic footprint, they may find it worthwhile to continue to go ‘deeper’ with service offering to include additional complementary services that assist their key influencers / decisions makers (contractors) while further enhancing their value proposition. Given the company’s flexible independent contract based set-up, this may include additional lower ticket but value add-based services outside of the major trades (paint, carpentry, electric, plumbing, HVAC, etc.) such as hauling, landscape design and implementation, tree removal, outdoor lighting, asphalt and concrete restoration, audio-visual and security system design and installation, etc. Alternately, the company may grow into segments that do not compete with their residential contractor client base. The may include performing recurring maintenance, janitorial and porter services for commercial accounts or for larger residential multi-unit developments such as apartments, condominium HOAs and more.