Buying a commercial cleaning company in Florida

A commercial cleaning company cleans offices, medical and dental practices, schools, banks, stores, gyms, churches, warehouses and the common areas of apartment and condo buildings, usually at night or early in the morning. Customers sign service agreements at a set monthly price based on the building's size, how often crews come and what's included. On top of that come extra services: floor stripping and waxing, carpet cleaning, window cleaning, cleanup after construction, and disinfection.

The appeal is steady monthly payments from many customers. The hard part is labor: most of the cost is wages, workers come and go, and supervisors spend nights checking that buildings were done right. Many agreements can be ended on short notice (30 days, for example), so service quality decides who stays. A small company usually has part-time cleaners in teams or assigned to buildings, supervisors or area managers who inspect the work and fill gaps, someone for sales and bids, and the owner. Supplies and equipment (vacuums, floor machines, chemicals) are a modest cost.

• Many customers, none too large, so losing one doesn't hurt badly. Watch for one property manager who controls several buildings.
• Customers who have stayed for years, including through price increases.
• Prices based on the hours each building actually takes, with profit tracked by account.
• Area managers or supervisors who check the work and handle complaints without the owner.
• Specialized work that's harder to replace, like medical offices, floor care or buildings that require security clearances.
• A steady way to hire and train, because turnover never stops here.
• Written agreements with every customer, not handshake deals.
• Customers who've added services over time, a sign they trust the company in their building.

Florida has no state license for commercial cleaning. Expect a county or city business tax receipt where the company operates. If the company offers pressure washing, state law bars local governments from requiring a license for it. Some add-on services do need a license. Treating for pests, for example, requires a pest control license from the Florida Department of Agriculture and Consumer Services, so check everything the company offers.

Employment rules matter more than licenses here. Florida requires workers' compensation for businesses outside construction with four or more employees, full or part time. Whether cleaners are employees or independent contractors affects payroll taxes, overtime and liability. Getting it wrong is a risk worth checking with an accountant. Customers such as medical offices, schools and government buildings may require background checks, specific insurance, or a bond that covers theft by the company's employees.

• Revenue by customer, and the five largest customers' share.
• Contract terms: length, notice period, price increase clauses, and whether the contracts can be transferred to you.
• Customer turnover: accounts gained and lost each year for three years.
• Labor cost per account, overtime, and pay compared with local competitors.
• How cleaners are paid: as employees with taxes withheld, or as contractors with nothing withheld. If contractors, ask your accountant about the risk.
• Immigration paperwork (Form I-9) for every employee. Florida also requires employers with 25 or more employees to check new hires through E-Verify.
• Insurance claims: damage to customers' property, accusations of theft, injuries.
• Who customers deal with, and whether they'll stay.
• Supervision: how many buildings each supervisor checks in a night, and what happens when a cleaner doesn't show.

• How many accounts do you have, and how long has the average customer been with you?
• Which accounts did you lose last year, and why?
• Are your cleaners employees or independent contractors?
• How do you know a building was cleaned properly?
• When did you last raise prices, and how did customers react?
• Who brings in new accounts now?
• Which customers buy extras like floor care, and how do you price it?