Showing posts with label my maid service. Show all posts
Showing posts with label my maid service. Show all posts

Wednesday, January 18, 2012

Groupon is causing me flashbacks to 2000 and not in a good way


UGH!  Another cleaning company is running a Groupon today.  It is immensely hard to sell my services at full price when it seems like once a month someone is offering deeply discounted services.   It seems like every company in my area runs one of these offers once, gets burned, and never does it again.  However it seems like Groupon finds a never ending string of victims.  The last 3 companies are little start ups I have never heard of before and they probably will not survive the experience.   I know Groupon and the copy cats will die because they are not delivering enough value.  But in the meantime it is just no fun to be getting my butt kicked my people losing money on purpose.  It also brings back memories.


My Maid Service is not the first company my brother and I have worked on together.  Way back in the frontier days on the internet, my brother and I had a web site called
www.theaquaticshop.com.  Shawn is a very serious animal enthusiast and breeds fish, reptiles, has a dog, a couple frogs, and a falcon.   His house is literally a zoo but he takes fantastic care of his animals.  Shawn saw an opportunity to set up a web site to sell hard to find high end supplies needed by people that keep fish rooms, not fish tanks.   It was a small community and Shawn had a great reputation.  My home just happened to be near the largest distributor of pet supplies in the world.  Shawn would run the community and I would pick up and ship the orders.   It seemed like a great idea.  We would provide a far greater catalog than the local store and at better prices.  The high end stuff we were selling was not in most stores and if it was they sold 2 or 3 a year so they marked it way up. It  We opened our doors in November 1998 and it was a huge success….. for three months.   Then in early 1999 Pets.com opened.

Pets.com was backed by venture capital funds and Amazon.com.  Our most profitable items were medications.  Pets.com was selling them for 25% less than our cost AND offering free shipping.  They were killing us.  We could not figure out how these guys were making money.   We tried to hold on but in March of 2010 we declared defeat and shut down the shop.  You can provide the best service in the world and offer great advice but when the other guy is selling 50% less than you, there just is nothing you can do.  Pets.com had over $100 million in venture capital funding and they went public at $14.00 a share raising even more money.  It was the dot com boom and Pets.com was everywhere.    In November 2010, after just 18 months and it was over .  Pets.com burned through hundreds of millions of dollars and shut down.  Once it all fell apart it became public that Pets.com was selling most items for 25% less than COST.  Hah, just what we always knew.  But it was too late for us.  We had closed up shop.

So what does this lesson have to do with Groupon?  Well I think Groupon is pets.com part 2.  They are growing like mad but they are losing money on every sale.  The businesses they buy from are by and large not happy with the results.  And they are causing pure havoc on every industry they touch.  Pets.com just hurt the pet care industry.  Unfortunately, Groupon is hurting every small business in America.   The good news is I do think the ride is nearly at an end for Groupon.  Just like Pets.com, the news is coming out that Groupon is losing money, their suppliers are not happy, and the glow is coming off them.  So hold in there.  Every now and then I wish Shawn and I had kept theauquaticshop.com.  We knew what Pets.com was doing was not sustainable but we just could not tolerate the pain anymore.  Don’t make that mistake.  Hold on, Groupon will fade just as Pets.com did.  In the meantime.  DON’T EVER FALL FOR IT AND RUN A GROUPON!  I will run another article on why later but please do nothing that feeds the beast and keeps it alive for another day.


Sunday, January 15, 2012

My company - background

I have realized by some of the questions sent to me that I may need to give you some background on my company, or rather companies. I spent 12 years at Procter & Gamble so I am a strong believer in different brands with different management for different customers. At P&G many brands like Tide, Cheer, Gain, and Deft are all owned by the same company but each brand has a team assigned to it and they are rewarded for the results of their brands. I have sort of done the same thing here.

My Maid Service is my biggest company and the parent company. Back to my P&G example, this is my Tide. My Maid Service has been in business for 14 years but I bought it in November 2007 so we are going on 4.5 years now. My Maid Service is 100% owned by my brother and I and we are not a franchise. We have tripled the company in the last 4 years. http://www.mymaidservice.net/ is the Cincinnati website. 3 years ago my brother, Shawn, opened My Maid Service Dallas. His office is now almost as large as the Cincinnati office and he will probably pass us this year in terms of revenue from maid service clients (he has no commercial division yet). http://www.mymaidservice.com/ is the Dallas website. Both offices use solo cleaners, paid on commission, driving their personal vehicles. I have a General Manager in charge of My Maid Service Cincinnati named Rachel. Shawn runs the Dallas himself.

ACS Cleaning Services is my commercial cleaning company and it only operates in Cincinnati right now. I also bought ACS but less than 2 years ago and we have grown the business to be 4 times larger than when we bought it. David is the General Manager for ACS Cleaning Services. ACS is not as high margin as My Maid Service but it is the fastest growing part right now. Back to my P&G Example, ACS Cleaning is my Gain. http://www.acscleaningcinci.com/ It is going to be an interesting year for ACS. In Commercial Cleaning you kind of work your way up the food chain from smaller accounts to mid teir and then finally the big ones.  In the last 2 months we have been invited to big on two very large projects.  I am both excited and terrified to win these.

I will be launching a new company in June to do chemical free cleaning. Carole is the general manager for this company and she is doing all the work to launch it and she is running some test teams to work out the systems and to test the marketing and pricing. This will be a premium priced company. We expect it to be smaller than My Maid Service but with better margins. This company will use company cars, teams, and the employees will be paid hourly. In my P&G example, this is my Dreft. A smaller brand that will never be huge but can earn very nice margins.
I meet with all my general managers once a week to talk about their key measures, progress on projects, and where they may need help.
Finally I am a partner with 3 other cleaning service owners of the Institute for Service Excellence. This is a school for other cleaning companies and it is the first school certified by the Clean Trust to teach the new Home Cleaning Technician program. This school will be the topic of other articles in the future but I want to be up front that I own part of it since most of what I will be doing and writing on next week will be related to the school. The website for the school is http://www.isetoday.com/ There is no P&G example for this one.

Saturday, January 14, 2012

Another Saturday of work and loving it

It is another Saturday and I am working at the office. My wife gets mad at me because I work on Saturdays from 10 AM to 3 PM but I really like to come into the office alone on the weekend. I can write on the white boards and draw out my ideas and crank up the music. I can brood over my problems and try to develop solutions. I do not have many hobbies except comic books and all things science fiction so I this is my hobby. I love business. For me it is a full contact sport. It is daily trials of your skill versus others. You practice daily, try to develop your skills and those of your team. You hope to win more than you lose but sometimes you get your head handed to you. This is one of those weeks. Below is basically my stream of consciousness of what I am working on when it is quiet on Saturday and I can really look at things.

So far 2012 has started really strange for us. We are down 5 customers right now which is a really bad start to the month. We are having some quality problems sneaking back in. I was not keeping a close enough eye on our trainer and she got burned out and the last 5 people that came out just were not up to par. We did not have a very good formal training program. We took one of our senior cleaners and had her work with trainees for 4 – 6 weeks to teach them how to do the job. It is not a very formal system put for years it has worked for us. But no longer. She drifted too far from what she was supposed to be teaching and generally lost interest in doing the job and I did not notice fast enough. To make it worse we have had very few good leads coming in. I am mad at myself for letting it go on for too long. In this business reputation is everything and training is key. The informal approach just worked too good for too long and I got complacent.

On the flip side I am so happy with where we are on fixing it. My two General Managers got together and over two weeks completely revamped our training system and that is what I am reviewing first. A lot of other great companies like Marvelous Maids and Castle Keepers had given us access to their materials. They developed a great illustrated technical cleaning guide. We also did a guide for the things that have nothing to do with cleaning. They created a daily training plan and check lists for both the trainer and trainee to sign off that things have been covered. Finally we created a 65 question test that covers policies and procedures that they must pass with an 80% of above. Then they created a plan to retrain all the employees we are having problems with and to make sure every employee gets at least a brief retraining. I am really proud of what they have done. This is the kind of stuff I expect from larger companies like P&G. It is great to see us growing up and even better to see us growing up when I had so little to do with it.

Looking at the customers losses. One customer cancelled because she said her kids are now cleaning her home as they got older. She is a very long time customer and it really surprised me. She is also one of the customers that goes back more than 4 years when I bought the company and she was still somewhat undercharged. I also noticed she opted out of our newsletter this week. I do not like this at all. Even if she was having her kids clean the house I would have expected her to keep following us as she used us for 8 years and may at least be curious what we are doing or what to get her carpet cleaned or something in the future. The cleaner I had assigned to her home has been the same for a very long time. That cleaner asked for this Friday afternoon off which is when this customer’s next appointment would have been so I sent one of my office staff to go check if she poached a client. (a tip for other cleaning service owners, client’s don’t normally change their schedule when they dump you. If you want to see if they hired another firm or your employee there is about a 90% chance they will be there on the next appointment time.) No one was there which was good. I hate that I have to watch for such things but I do. However I am still very unsettled by this customer. She swears nothing was wrong. I think I am going to try to visit her at her business. She is a small business owner and maybe I can appeal to her for the really really. At the end of the day I just do not think my cleaner who used to be a rock star has been cleaning up to par. When someone tells me they are going to have their kids clean their home it tells me something is just wrong and we are not blowing our customer away.

The next customer we lost is a messy divorce. Completely legit and once they get done fighting over who gets what I hope to get one or both of them back on. I have to create a system to make sure we stay in touch with clients like this other than the newsletter. Too much going on right now but I will add it to the project list.

The next customer is almost funny. They cancelled for financial reasons. Today my commercial cleaning company got a request in the mail to sub contract for Vanguard Cleaning Systems which just opened a franchise in our area on November 30th. The owner, my former client. So I guess he is low on cash since he is taking a big risk. Not sure what to do with this. I will never sub contract for a commercial cleaning franchise but that is a whole other topic as to why. However I am not sure if I should call him and congratulate him and meet with him? I think yes. I am not sure much will come of it since I DESPISE the franchised commercial cleaning model but he is in my business and I should at least say hello (once again this does not apply to the maid service franchises which are a completely legitimate way to get into my industry. Commercial cleaning franchises are a huge scam in my opinion to make low income minority people pay for the right to get a minimum wage job, a fact backed up by a lawsuit Coverall just lost in the Massachusetts Courts.)

The next client cancelled because we could not arrive by 8:00 AM to clean her home. This frustrates me because we are always very clear on arrival time but this client two cleanings in demanded we started coming at 8:00 AM and we said we could not do it . She refused to give us a key or any other form of access and said all her other cleaning services had no problems meeting her time demands. It just does not work for us. Everything we do including when our office opens is around an 8:30 – 9:00 AM arrival time. I am frustrated as to why this was not understood up front. I will need to make sure this is something that is being covered when we book a new client. That being said, clients will not always understand everything you say but I always hate to lose people for what seems like stupid reasons to me.

The next client cancelled because we did not lock her front door. My cleaner swears she locked it and even double checked it. This is a great very reliable cleaner but she has HUGE problems with locks. She calls all the time and cannot get the key to work but when a supervisor goes out it opens right up. This is another one of those very frustrating things. I lost a customer for a seemingly easy fix but at the same time I just do not know how to correct this issue. How can I teach someone how to use a key and locks? This is a really good cleaner and employee but she just cannot to manage locks. I will have to ask my GM Rachel to ponder this one.

The next lost client is for financial reasons. She has written us good reviews on Angie’s List including when she left so I know the quality of service was OK. Mad people do not write a good review when they cancel. However this one also still bothers me. I have 3 cleaners that literally lose 1 or 2 customers all year due to death and moving. They never lose a customer for financial reasons. I mean NEVER. I refuse to believe it is just dumb luck that makes this happen. They are doing something that makes the idea of not using My Maid Service inconceivable. I need to figure out what it is and replicate it. To be clear this was a satisfied customer but having satisfied customers will put me out of business. The economy is making people make choices. I need to make it so we make our client’s lives so much better that they will never consider getting rid of us. I need to really work on this over the next two months. This is the stuff that makes a company great. In a good economy being a good company is enough but to keep growing we need to be fantastic and I need to figure out how to bottle that magic and make is a system, all with lower income employees and a highly physical and in a not very well regarded industry. The challenge of my business.

Another cancellation because we were helping clean his mom’s house and she is in the hospital. Not much we can do there to have kept him but we missed an opportunity. We know so much personal information on our clients and he just told us his mom is in very poor health. I have an entire card display in the office with the idea we can send cards to clients when things come up but to be honest not a lot gets done with it. I need to fix this. Once again this is the magic part but magic has to have a system behind it. How do I build amazing customer service into my company when during the day we are so focused on the basics of getting people where they need to be and dealing with the daily emergencies of broken equipment, customers that locked us out, and traffic?

Total count, 3 clients I could have done nothing about (divorce, new business, mom in hospital). 1 client I should not have lost at all (key issue). 3 clients I should have been able to keep if we had been better than just good. That means if I can figure this out we would have only been down 3 customers instead of 7. (FYI I said we were down 5 because we sold 2 new ones so far so if we had only lost 3 we would only be down 1 client right now, a much more manageable number). Two that I lost should have left as raving fans and I missed the opportunity. There is something here I am missing. Time to stand in front of the white boards for a while and something to bring up in my weekly meetings with my General Managers. This is what I do on Saturday.