Cleaning Industry - A Snapshot of What Guardian Does & Delivers?

Industry Description - Cleaning Industry 

The cleaning industry can be roughly divided into residential cleaning, commercial janitorial services, specialty cleaning and laundry/dry cleaning services. In 2015 there were approximately 875,000 businesses employing about 3.5 million people.

The industry as a whole is very susceptible to economic downturns and suffered through several rough years during the Great Recession; revenue fell 5.3% in 2008 and another 6.1% in 2009. General cleaning services, and particularly residential services, are deemed an expendable luxury when times are tough.

However the years of economic strength since then have seen the industry bounce back, and in 2015 it generated $51 billion in revenue. This recent upward momentum can be attributed to both unemployment and office vacancy rates declining as well as a pickup in nonresidential construction activity. In other words – people have more money to spend and feel more secure spending it, and there are more offices that need cleaning.

Strong economic activity is forecast for the next 5 years as well, and the Bureau of Labor Statistics is predicting job growth of about 6% from 2014 levels to 2020.

Business Risk

It is estimated that the average cleaning company loses up to 55% of their customer base every year due to poor service. As one business owner states – good work goes unnoticed for years, but a bad job gets you fired immediately.

Competition is fierce – there are many small companies competing for both residential and commercial cleaning contracts. Barriers to entry are low as there is very little expensive equipment needed and little to no training required for employees – so new competitor’s spring up all the time.

For dry cleaning and some specialty cleaning services, however, expensive equipment actually can be a significant hurdle, including needing commercial or industrial real estate to sell and perform services.

Commercial Cleaning

Often referred to as janitorial services, the commercial cleaning industry thrives when office vacancy rates are declining and nonresidential construction activity is picking up. Office cleaning accounts for approximately 31% of industry revenue, and most of these businesses work the 2^nd or 3^rd shift when offices are empty.

Specialty Cleaning

These types of companies focus on specific types of cleaning – windows, floors, carpets, industrial and more, and they may be a bit more recession resistant if they offer a service not easily performed without special equipment or training. 

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