Guide to Janitorial Bidding Chapter 2
March 5, 2020
March 5, 2020
Crunching the Numbers
Now that you’ve carefully considered the first three questions in Chapter One of our Guide to Bidding, and hopefully made changes or improvements where they were needed, it’s time to move on to crunching some numbers. We know, it doesn’t sound like much fun, but it’s absolutely important to do this in advance of bidding on big contracts—or you could end up doing a lot of work for not enough money. And nobody’s got time for that!
Let’s get back to those Eight Questions.
Question 4 - How to Calculate Quotes
Are you confident in your ability to calculate quotes for BIG contracts? We understand this can feel intimidating, but it doesn’t have to be. Start by breaking it down into individual aspects of your business, and consider the following factors before you throw your hat in the ring for a bigger than usual contract.
Things You Need to Know Before Bidding Big:
- Cost of Supplies
- Labour Cost
- Operating Overhead
- Profit Margin
Once you’re familiar and comfortable with these numbers, you can more accurately calculate a quote for your cleaning company to bid on a big new contract. Knowing these numbers will ensure you’ll make money from the contract.
Just a friendly reminder that we’ve already developed a cleaning estimate calculator app, it’s easy to use, and available for your Android or iOS phone. This could save you a lot of time! Get the app for free.
(above image: Not enough capacity? Consider a virtual assistant. This baby knows his math, and his mom is pretty skilled too!)
Question 5 – Do You Have a Professional Proposal Template?
You want to put your best foot forward when leaving a potential new client with the digital and/or hard copy of your proposal. The selling doesn’t stop when you leave the meeting. Make sure to have a professional looking template designed that you’ll use to format all your contract bids. Overall this looks impressive and leaves the client with a better impression of your cleaning company.
You may feel that you don’t have time to be in front of the computer customizing each proposal for prospective clients. However, there are already tools out there that have been designed for just this scenario. Sign up for the free trial of Proposify, and check out their very nicely designed cleaning contract proposal template. You’ll be hooked—and it will save a lot of time agonizing over a design. You want your janitorial company’s proposals to stand out, and every little thing you do to look better than the competition helps.
(above image: Impress potential clients with Swept’s Quick estimate app)
Question 6 – Do You Have Enough Staff?
Back to the numbers. What does your current labour situation look like and how is recruitment going? Do you have enough staff to even take on a big new contract, or do you have access to hiring new staff? We recommend getting the ball rolling on hiring before you bid on big new contracts, that way you’re not struggling to fulfill your commitments to the new contracted sites, when the time comes.
Question 7 – Do You Have the Cash Flow?
Ah, the big question at hand… do you have the cash flow to pull this off? How will you pay the new cleaners you’ve hired and purchase the supplies if you don’t yet have any payment on the books from the new client? Sounds like a chicken-and-egg scenario. Here are a few options we suggest…
Tap into Your Savings
Do you have available funds from your own lines of credit or bank account(s) that could hold you over until the payments from this new contract start to get collected? If you’re in a position to do this, it could be a great option.
Have a conversation with your new client about billing options. Is there a way to get the money up front before the contract is executed? If you can manage to make this kind of arrangement, it would be ideal.
If you’re confident you could manage this without hurting your credit rating and paying too much in interest charges, this is one option to get that big contract started.
Talk to Your Bank
Get to know your banker, talk about how you’ve been bidding on bigger contracts and the additional revenue these contracts are going to bring in—talk about your business growth plan. If you’ve signed a large new contract and can prove to the bank that you’ll easily be able to pay off new loans, hopefully they’ll be interested in lending to you.
Question 8 – Do You Have a Growth Plan?
Speaking of that growth plan… do you have one? In order to take on bigger contracts and stay on top of things, you need to be organized and prepared to grow. If you take on more than you can handle, you’ll end up losing contracts and your reputation could be negatively affected.
Think about the following factors and how you’ll handle them when you take on bigger contracts and more staff:
How will you communicate effectively with your larger number of staff and clients?
How will staff stay up to date on the schedule?
Spreadsheets can only go so far.
The more clients you have, the more problems will be reported—it’s only natural. How will you track these and stay on top of fixing things?
There are options out there to help make growing your business easier. There’s already janitorial software that has been developed to address these specific areas of running a cleaning company. We definitely recommend learning more about Swept, which was designed to do all of these things.
As we said last time, we are only scratching the surface here. With one more chapter coming, and no shortage of useful know-how about bidding in the janitorial industry, rest assured we have a lot to say on this particular hot topic!
Swept is dedicated to highlighting stories that touch everyone in the janitorial industry. Having started as a commercial cleaning company ourselves, our hearts go well beyond the janitorial software we offer. Learn more about Swept’s cleaning company software here. And to keep up on all the trends in the janitorial services industry, subscribe to our blog!