Life gets messy, which is why a carpet-cleaning business will always be in fashion. There are some stains and messes that the average person can’t clean with regular household equipment. This is where you come in.
Starting a carpet-cleaning business is actually pretty easy. There aren’t any special permits, and it has a relatively low initial financial investment compared to other opportunities. From creating your first carpet-cleaning business plan to rounding out your marketing plan, these steps will help you get started.
Write Your Carpet-Cleaning Business Plan
When you’re starting a carpet-cleaning business, you can go one of two ways: You can start from scratch with your own carpet-cleaning business plan, or you can choose to open a franchise from an already successful carpet-cleaning business. There’s no right way, but both have their own pros and cons.
A franchise business is a great option if you want to buy into something that already has a built-in customer base. Unfortunately, the startup fees range from $20,000 to $50,000. This isn’t a lot compared to other businesses, but it isn’t anything to scoff at either. On the plus side, you’ll get a lot of support and training with a franchise that can prevent you from making mistakes that most startup carpet cleaners make, and they may even help you with a solid business plan that’s worked for their other franchisees.
If you’re starting your business from scratch, you’ll need to create your own carpet-cleaning business plan, but you stand to make a lot more money. Startup costs are a little bit less (especially because you’re not paying for franchise fees), but it may take you longer to find a solid base of customers. Is the risk worth the reward? It’s up to you.
Nail Down Your Niche
Sure, when you’re cleaning carpets, your business model is that you’ll clean carpets, but you should really have a clear idea of your customer base and what’s needed in the market before you dive in. Take a look at the carpet-cleaning businesses around you and see how they function. Are they focused on commercial and government contracts, or do they stick to residential cleaning?
You’ll be putting yourself in a tough position if you open up shop around a lot of similar businesses. Try to find a hole in the market and cater your services toward that. If there are a lot of home-cleaning businesses, consider catering your carpet-cleaning business plan toward offices and government contracts like schools or town buildings. You could even slant your business toward medical offices and hospitals, which have unique cleaning needs.
Find the Funding
It’s possible to start a carpet-cleaning business for as little as $10,000. If you need to lease or rent a work van to carry your equipment from contract to contract, it will probably wind up more in the ballpark of $30,000 for a midsize business without a storefront.
Since a storefront can bring you more traffic, you may want to consider an upfront investment of between $50,000 and $80,000. This is the norm for the industry, and you can start small and expand later, but you will need to find the initial funding.
If you don’t have enough saved to launch your business, you’ll need to approach a bank for a business loan or reach out to investors. Consider asking your friends and family to get in on the business or search for a partner who is willing to help with financing.
Get the Insurance
Businesses need insurance in addition to a business license. You’ll definitely need to pick up a general liability plan, which covers you in case any sort of accident happens on the job. If you’re hiring employees, you’ll also need a workers' compensation plan, which protects your business’s finances if an employee is injured on the job. If you have a vehicle, you’ll also need a commercial auto plan.
It might also be wise to set up a surety bond. This sort of escrow account holds funds that might put your customers at ease. In other words, it ensures you do the work for which you’re paid, and you can use the money in the account to award damages to any customers whose carpets you accidentally ruined if a lawsuit arises.
Handle the Legal Requirements
Once you get your insurance, you’ll need to set up a business entity with the government to get a business license. As a carpet-cleaning business, you can choose a sole proprietorship and obtain an employer identification number through the IRS, but it’s more likely that you’ll want to form an LLC. This way, your personal finances are protected in the event that your business struggles. You can create an LLC online using a service like LegalZoom, and it only costs a couple hundred dollars.
Once you have your company’s structure all set, contact your local small business administration to get a small business license. You’ll also probably have to obtain a seller’s permit, but it depends on your state. You don’t need any other special permits or licenses for this type of business.
Get the Equipment
You don’t need a lot of equipment if you want to start small and expand later once you have more contracts. You’ll still definitely need to invest in some basics. Luckily, there are a lot of carpet-cleaning equipment suppliers that can help you get started, including Jon-Don and Rotovac. These companies even offer training materials for hopeful business owners.
Ultimately, you can purchase an entire carpet-cleaning system from a company like Rotovac, or you can go a la carte. You'll need:
- A van to help you carry your equipment between jobs
- A portable cleaner with a power wand or brush that has rotating heads with an attached holding tank
- A portable carpet extractor
- An upholstery detailing tool
- A stain or spot kit
- A carpet rake
Rotovac’s entire system will run you just under $3,000, but professional, commercial carpet-cleaning equipment can get as expensive as $15,000 for something like a ride-on floor sweeper.
Hire the Staff
You might not want to hire staff right off the bat, but to become highly profitable, you’ll likely need to expand and take on multiple contracts at the same time. This is when you’ll need to hire some dedicated staff. Make sure they’re personable, professional and detail-oriented. Creating an employee manual or training guide will help get any employee or hired subcontractor up to speed.
Market Your Business
Marketing is the last thing to do before your launch. Register your business with websites like Angie’s List, Yelp and Google My Business. This way, people can find you when they search for carpet cleaners. You probably will also want to run ads locally. Consider utilizing diner menus and church or town bulletin boards, and you can even sponsor a local children’s sports team.
If you’re looking to target businesses, it’s time to start handing out business cards at corporate events. Word of mouth is a huge help when it comes to a small carpet-cleaning business, so once you land a great corporate contract, you’re likely to get more business if you do a good job.
Mariel Loveland is a small business owner, content strategist and writer from New Jersey. Throughout her career, she's worked with numerous startups creating content to help small business owners bridge the gap between technology and sales. Her work has been featured in publications like Business Insider and Vice.