How Ed Clay Started His Cleaning Company While Working On His 9-5 and Grew It Into a 2.6 Million Annual Revenue Cash Pumping Machine

It was a day like another other back in 2014 when Ed Clay saw the perfect opportunity while searching for cleaning services online.

He was excited because almost all of the local websites on Google were terribly designed. They looked like they were made ten, twenty years ago.

Not only that, these sites had needlessly complicated quote systems.

Ed thought, “Who would ever want to fill up so many details just to get a simple quote to have their home cleaned?”

“If I were to come out with a decent site that makes it super easy for people to book a house cleaner, I should be in business.”

That’s how this idea came to him.

Now, before we move on to the real action, here’s a little background information.

Ed Clay is from Melbourne, Australia.

Melbourne and its suburbs: Brunswick, Hawthorn, Brighton, Clayton have a combined population of around 4 million. Pretty decent for starting a cleaning business.

Weak would-be competitors and a good market size mean lots of potential for a new business.

Things were looking good.

But here’s where Ed ran into a problem.

Ed was a full time mechanical engineer; that meant he had to build the business on the side while still on his 9-5.

Here was his plan:

#1. Set up a website to take bookings.

#2. Hire cleaners as independent contractors to go in and do the cleaning.

#3. Split the profit. Cleaner keeps 70%, Ed takes 30%.

He decided to do the marketing and let the others do the cleaning. That was the only way he could get started while keeping his day job.

One thing to note: his full time job gave him a fair amount of independence. He was able to respond to text messages or emails instantly at his desk. Even if calls came in, he could afford to miss a couple and return them during a break.

So, that was the plan.

First, he set out to find cleaners in Melbourne and its suburbs, heading over to Gumtree to try his luck.

Gumtree is the #1 classifieds (small advertisements) site in several English speaking countries outside of the US, such as the UK, Australia, South Africa and Singapore.

It’s the Craigslist equivalent for them; just like people in the United States use Craigslist to advertise their local services and items-for-sale, those people use Gumtree to do the same.

Ed posted a “trial” ad for cleaners on Gumtree; and to his amazement, there were 150 responses to his ads in 2 days!

Bingo! The supply side was now taken care of.

He immediately began gathering as much information as possible and from there on started his journey to own a cleaning business.

He had his website completed and launched it on May 2014.

Here is the link to his site.

He got his first customer in his first week. The feeling was awesome.

1 month later, he was averaging 5 bookings weekly.

9 months later, averaging 30 weekly bookings.

2 years later and the business was profitable enough to allow him to leave his 9-5 and run it full time from home.

3 years in; here is what happened:

#1. 40+ active cleaning team, 2 office staff, 1 virtual assistant, and 1 assistant manager running the show for him.

#2. $50,000 weekly revenue. That’s 2.6 million annual revenue. He grossed 30% of that as profit.

#3. He moved to an office. And here is what his new office looks like:

Running a cleaning company can be a good business.

The best news is, you can start part time and gradually grow it into a a huge money-maker, just like Ed.

In this post, I am going to show you how Ed started running his business part time all the way until he quit his 9-5.

I’ll also show you the tools he uses to manage his team, the marketing strategies, and the important areas you want to pay attention to if you want to make this work for you.

Keen?

If so, keep reading…

You don’t need a lot of money to get started

Ed started the business with a measly $644.93 and here is the breakdown:

• Domain name registration $9.95
• Web hosting $110.29
• Logo design $39.00
• Web design $175.00
• WordPress help $75.00
• Facebook advertising $114.00
• Adwords advertising $121.69

$644, that was the amount of money that got him started.

Looking back, Ed recommends anyone who wants to do the same have around $1000-2000, just to be safe.

Adwords and Facebook advertising might require more money; those ads can be tricky, so have some backup funds.

Another reason is that Ed has some skill with WordPress, which saved him some money when the designer he hired didn’t get the job done as promised.

The web designer that Ed hired on Freelancer.com was paid to build his website at $250.

He got the WordPress theme up but aside from that he didn’t do much, so Ed paid him just over half and ended the job. He then got to work on it himself during the weekend, with some further assistance for $75.

If you are technically challenged with a WordPress website, do reserve a little more than Ed for the website.

Tools to run a cleaning company

Apart from investing on website design and advertising, there are a couple of essential tools to run an efficient cleaning company.

These are the tools that Ed used to run his business since day 1:

Tool number 1: Stripe, an online payment processor for internet businesses.

The beauty about Stripe is that it has a recurring billing option, where you just have to save the customers to a list, and then rebill them by looking them up in your database the next time they need cleaning services.

This is great for customers who hire a cleaning company repeatedly.

There is no set up fee to use Stripe, you’ll pay 2.9% + 30 cents for each transaction. It’s no pain to start with even if you are bootstrapped.

Another tool Ed uses is called Launch27.

It’s an online booking software and appointment scheduler for service business.

Apart from taking booking online, with Launch27 you can automatically send a follow up email to the customers to leave a review for your service.

When a customer is happy with a cleaner, Ed directs his customers to leave him positive reviews on Facebook.

At the time I am writing this, Ed has 99 reviews with 4.9 stars on his Facebook business page:

According to Ed, those positive reviews play a big role in convincing people to take him rather than the competition.

Apart from Stripe and Launch27, he added 2 more tools to his arsenal after growing the business up.

The first one is Microsoft OneDrive.

Ed and his team share an “Activity Log” using OneDrive which is basically a spreadsheet in Excel that logs in all inquiries, requests and phone calls, and everyone works in it at the same time.

It’s like a giant, transparent to-do list. Ed and his staff also use this to log new phone bookings, assign them and manage the billing. This allows multiple people to work in the same department without doubling up.

Another tool is called TextMagic.

It’s an SMS portal which Ed and his team use to message cleaners and customers.

Pricing structure

With the website and the tools in place, Ed went to the drawing board and came out with his pricing.

The customer only be asked how many bedrooms and bathrooms they have to get a quote at a flat rate for the job.

Everything is straightforward from there apart from how the Kitchen+Living+Hallway time is calculated. He sets basic times for them, multiplying by a factor based on bedroom size. E.g.

1 bedroom = 1.1 * (Kitchen+hallways+living space time)

2 bedroom = 1.2 * (Kitchen+hallways+living space time)

3 bedroom = 1.3 * (Kitchen+hallways+living space time)

This is done so that minimal input will be needed when quoting an inquiry. Ed will scale up the prices for living areas as the size of the home increases.

Apart from flat rate pricing Ed also does hourly rates. He will let the customers choose if they would like a flat rate or an hourly rate (where the cleaners will be flexible and do as much as they can within a fixed time period).

Now, for paying the cleaners…

For less experienced cleaners, they get paid 50% for their first 3 jobs, 60% for the next 3, and then 70% for subsequent ones.

To the experienced ones, they start off at 60% for the first 3 jobs.

Once the pricing was taken care of, Ed went out and hired 2 cleaners on Gumtree, and launched his website.

Here is what happened after he went out to market his business.

Year 1

When Ed went out to promote his service, the first week got Ed a couple of bites, 2 customers scheduled in for the following week.

The first was a person with a 3 bedroom house that wanted a weekly 3 hour clean.

Second is for a fortnightly clean of a 4 bedroom house.

Both of these clients found Ed through ads and responses to ads on Gumtree.

A good start.

The second week was good as well: two more people responded.

One was a four bedroom house, to be cleaned fortnightly and the lady also wanted her mother’s 6 bedroom house done periodically during the year and when her cleaner goes away, weekly!

There was another guy looking for a one bedroom clean every now and then.

Like the previous week, both were recurring jobs. Ed was pumped.

At the end of the week, Ed realized the business outgrew his cleaner capacity. He had just one cleaner and it was making scheduling stressful.

He then spent a fair bit of time each day after work responding to ads on Gumtree from cleaners looking for work.

He interviewed 4 people during the weekends, and added 4 cleaning teams (3 singles and 1 duo) to allow growth.

During the week he also started a project with an SEO expert. He was hoping to get his new site ranked as soon as possible so he didn’t have to keep dishing out ads on Google and Gumtree for clients.

Ed was in green in the first month he was in business.

In that year, the business saw steady growth, then it really started picking up towards the end of the first year when Ed’s web presence grew.

Year 2: $1 million annual revenue

After running his cleaning business passively for approximately 2 years (to be exact, 20 months), the business hit $1 million dollars annual revenue.

At that time, the business was large enough to pay Ed a basic salary and still generate enough profit, so Ed took the plunge and quit his engineering day job to take it full time.

Here is a graph of Ed’s cleaning business’ weekly revenue growth for 2 years:

Year 3: 2.6 million annual revenue

When he hit his 3 year mark, Ed moved in to his new office, then hired 2 office employees to assist with the admin and general running of the business.

They took care of all the time sensitive areas of the business (e.g. taking phone calls from customers/cleaners and dealing with day to day problems/requests from the cleaning teams).

This left Ed with less responsibility.

He then focused on long-term plans like schedule management and recruitment, something he could do at his leisure.

His ultimate plan was to hire someone who could do even that, and let the company grow by itself.

By year three, the business had generated a 30% profit margin for Ed.

That’s before any expenses or staffing fees. Meanwhile, net profit was between 12-15% of gross turnover.

From a measly investment of $600, Ed had now grown this baby into a business that got him out of the 9-5 rat race.

Today he is doing around 2.6 million annual revenue and the business is still growing.

At this rate, it shouldn’t take long for him to find a full time manager to oversee the entire business and become self-sufficient.

Ed tried lots of different marketing strategies to grow his business.

Most of his bookings came in through these ones:

Marketing strategy #1: advertise on Gumtree

Gumtree is the place Ed started with while trying to get customers.

Ed’s first few clients came from a mixture of Gumtree audience and AdWords ads. Most are from the former.

Making it work on Gumtree is pretty simple; just advertise on the site, and response to what the ads bring you.

According to Ed, in the early days, he was replying to ads on Gumtree on most evenings after work and from there he got his first clients.

But Gumtree does have its limitations. The traffic there is limited.

Therefore, he needed other sources to get more bookings. That’s when quotes sites come into play…

Marketing strategy #2: use quote sites

Quote sites were golden to Ed when he was starting out.

It’s really simple, people looking for cleaners post their jobs, and Ed quotes them. With the right price, they will get in touch.

A good example of a quote site is ServiceSeeking.com.au

Sites like these enable consumers to list their jobs and allow businesses to quote on the jobs.

Ed was smashing it with quote sites in the early days of the business when he was still learning the rope of running Adwords campaigns.

Ed paid $75 for a month’s membership, and in the first month he managed to quote over 100 people and pull off 7-10 bookings from it.

Some decent margin one off cleans, and a couple weekly/fortnightly customers.

According to him, after a while you can feel which requests are looking for super cheap cleaning, and for those Ed will just shoot them his hourly rate of $35/hour.

For customers who want more thorough cleaning, Ed usually quotes them a rate which is higher than most, he has picked quite a number of such bookings right after getting the hang of it.

For weekly requests, Ed quotes a range. He then suggests a full service to start with, followed by a few hours a week.

For example, if someone asks for a 4 bedroom 2 bathroom weekly service, Ed will quote them $189 for the first full service, and then $99 weekly for 3 hours of cleaning.

Ed says he always targets the weekly requests first, as they make him around $30 for each cleaning. That means big bucks in the long run; $30 a week for a year is $1500.

Like working on Gumtree, the quote sites are good when you are starting out and have very little budget to spend on AdWords and SEO.

Marketing strategy #3: Google AdWords and SEO

When Ed had more money in his hands, he spent it on Adwords and hired an SEO agency to rank his site for the local city-based keywords he wanted to target his site for.

Adwords got him a good stream of booking once he started running ads on it.

Of course, it didn’t make his bookings skyrocket. It took him quite a bit of time to get everything right.

As a bootstrap company, Ed spent $5 – $20 per day on Adwords in the first 6 months while he was learning the ropes. After getting some traction, his ad spend grew to $20-$30 per day.

At around 1 year after launching the business, he decided it was time to add another traffic source to his mix. He started engaging an SEO agency to give his website the search engine results page lift he wanted.

Today, you could say that Ed’s business solely relies on SEO and Adwords, with Google search providing the majority of the bookings.

His site is currently ranked #1 for many “city + cleaning services” search terms he covers.

His coverage include Melbourne, and its suburbs like Brunswick, Hawthorn, Brighton and Clayton.

If you are reading this from Australia, try Googling those suburbs + cleaning services and you’ll see MaidtoClean.com.au popping up for almost all of those terms.

So, if you are running a local service like Ed, spend money on SEO as soon as you can afford it. It will be the best investment you’ll ever make.

At the time I am writing this, Ed still has no blog attached to his site.

All he has is a main page, a few more pages to showcase the services he provides, a pricing page, the contact page and the standard pages required by law (e.g. terms, privacy page etc.)

This shows it doesn’t take a lot of content if you are in a semi competitive market and have good SEO.

He started with $1300 monthly for SEO. Today, it’s slightly higher: $1500.

According to Ed, he went with a local SEO agency in his city.

For less competitive keywords (suburban terms and longtail keywords) they managed to get him up after about 3-6 months. For the main keyword he targeted for, it took a year.

For him, looking back, it was the smartest decision he made to grow his business.

There you go. The top 3 strategies Ed used to grow his cleaning business online.

If you’re still reading, congratulations! Here’s some extra value I can give you out of Ed’s experience and a few tips to make setting up businesses like these a success.

Interested?

Awesome. Here we go ~ 4 Important things Ed learned to make a successful local cleaning company:

#1. Have a good website

Your website is crucial to your business as it is almost always your one and only sales pitch.

Your site needs to be absolutely top notch.

Ed’s site still has a lot of space to improve.

After 3 and a half years in operation, he admitted he was still unhappy with his site. Even after some continuous tweaking, he thinks there’s room for a lot of improvement.

I agree. When I browse MaidtoClean.com.au using different devices, I notice user experience on the site isn’t the best.

#2. Be the nicest and most apologetic person there ever was

Yes, that’s exactly what he said:

“Be the nicest and most apologetic person there ever was”.

Cleaners are independent contractors; they are not your employees.

With this business model, you have far less control over them as opposed to hiring cleaners as full-time staff.

There’ll be times when they let you down.

When the cleaners let a customer down, be extremely apologetic; be nice to your clients. More often than not you can solve the problem, just don’t blame the cleaners.

Taking the responsibility yourself works the best in the long term.

Remember, listening to clients’ complains and accepting their suggestions is what a service industry is all about.

#3. You want to keep hiring

You want to keep hiring cleaners.

Scheduling is difficult at the start and only gets easier when you have a larger work force.

According to Ed, he got himself into deep trouble early in his business when one of his cleaners who was doing 10-15 regular clients a week left him.

He didn’t have any replacements; he went into panic mode for a while and recruited like crazy.

He learned it the hard way: always recruit.

You can never have too many excellent cleaners.

Have some trailing ads out at all times as you never know when you’ll get an absolute catch.

On a related note, not all cleaners are good. Finding reliable and good cleaners is absolutely paramount to success.

Ed says whenever he finds good new cleaners growing is easy.

But finding them, interviewing them and teaching them the know-how, that’s the hard part.

To do this, you’ve got to put a lot of energy into it.

Ed always has 4-5 ads running online to get people responding daily.

95% do not qualify but every week or two someone writes a good response and fulfills all the requirements (English speaking, has ABN, police check etc.) and he’ll interview them. He then gives them a trial job to test their commitment.

#4. You need a good hiring process in place

Recruiting cleaners is easier said than done. But through trial and error, Ed has been able to come out with a good process.

Here what Ed’s hiring process looks like:

When cleaners respond to Ed’s ad, he lets them know what he is looking for, and checks if they are interested.

If so, he provides more details and refers them to JotForm.com to fill out personal info and ask some simple questions.

Once they have submitted their form, he will give them a call and arrange a meeting.

Interviews are casual meetups at a cafe near Ed’s place. There, he provides an info pack regarding his business, a checklist and the independent contractor agreement.

Ed will then go through their background and they get to know each other a bit.

Then, at the end he asks for the independent contractor agreement to be read, signed and sent back to him, along with their CV if Ed hasn’t gotten it ready, as well as a police check.

The national police check is a summary of anyone’s police history information in Australia.

Checks can be conducted on Australian citizens or anyone residing in Australia.

It is a government service provided to either an individual or organization for employment, voluntary work and occupation-related licensing or registration purposes. This may or may not apply to you if you are operating outside Australia.

Only after Ed has their police check will he work with them as he wants to make sure they have no criminal history.

Replicate Ed’s business model in your city

One great thing about the business is that a big chunk of the bookings are weekly/fortnightly repeat customers so once you have built the business, you have a solid foundation.

You don’t have to find new customers daily; that’ll work you to death.

Not many businesses, whether online or offline offer repeat customers like this one.

If you go back and look at Ed’s revenue growth chart, you will realize that it’s the nature of the business that gives him that kind of steady growth.

Yes, he’s been working hard and smart, but it’s this type of business that gives him cumulative growth.

After running it for more than 3 years, the business turnover isn’t a problem – the website traffic and bookings are growing constantly so the main focus for Ed is to try and become more independent.

That’ll all be possible once he finds a full-time manager.

His dream of going for month-long holidays while money keeps flowing into his bank account isn’t far away.

Having achieved your dream, it’s all about sticking to it and grinding it out. Life is challenging, and this is no different. But if you put in the effort, you’ll get there in the end.

If you think it’s a great business model, let me know your thoughts below.

All the best, and until next time!