Has anyone started a STR cleaning company (or PM company)?

Question

My STRs are in a small destination mountain town and finding good cleaners is the #1 struggle. Many owners are also absentee and rely on PM companies to book their properties and cleaners.

Does anyone have a good podcast or direct experience with starting a cleaning company and paying the cleaners on W2, possibly even benefits, to ensure quality work? Most cleaning companies where I am don't pay that well, don't use scheduling tech, don't offer enough hours for full time, and aren't run by someone who has their act together.

Seems like an opportunity but looking for first-hand advice.

Andrew Steffens · Answer

I co-own a PM company with around 80 units in FL. When starting we relied 100% on B2B cleaning vendors. As we grew we began hiring cleaners in house W2. We are in a semi major metro (Tampa) so while labor is always challenging it is not as difficult as a small town I imagine. Let me know if you have any specific questions, I am happy to help.

Garrett Kroll · Answer

@Kristi Miller we were in a similar position as you- small mountain town, not great cleaning options, lack of tech etc.

When we started our PM company we made the commitment to pay the highest 1099 cleaning wages in our area. We made a bet: be okay with no (or negative) margins on cleaning and let high quality reviews pay dividends years later.

It’s paying off. We now have an excellent crew, top notch reviews, and frequent inquiries to join our team. Our strategy was finding independent residential cleaners and training them on STR processes.

From what I’ve observed the economics of small town cleaning businesses aren’t great. In fact, most of our cleaning headaches in the early days came from hiring b2b cleaning businesses who paid their subs really low wages to make their own margins. That’s not a recipe for quality.

Tyler Winget · Answer

Cleaning is a high-turnover business from an employee standpoint. The ladies in these small mountain towns are raising kids, cleaning in-between school hours, sometimes even having their kids help them work the business after hours.

Before you read, No, we chose not to start a cleaning company and pay via W2.
Here's why:

They're already making $50-$75/hour working on their own - and we knew we couldn't match that. And we needed the quality to be kept high.

So, we found one or two that were hungrier than the rest and had a desire to grow a family business, one where we'd be giving them the work. We built the vision for them for what it could be like.

@Garrett Kroll had a similar response.

We scaled in a mountain destination with only a handful of teams that did that, copy and paste. The cleaners get paid well, one of them is $20k+ per month, but we'd have top-tier cleaning reviews on listings. They'd be a partner and help provide solutions to operational challenges when scaling, we'd bring tech in like Breezeway for scheduling, give them a company card with spend limits to buy supplies, they even ended up landing a deal with a local laundromat to wash and fold there after-hours to make their lives and ours easier.

Truly a win-win.

All depends. Do you want to be in the cleaning business? Or the PM business? Some old-school PM's do both. But they don't manage top-tier listings where staging has to return to normal after each turn.

Just more insight for you. Hope this is helpful. Good luck!

Yiwei Cheng · Answer

I own and manage STR in Cincinnati, but I don't want to get into the cleaning business for a reason. It's another business to work on & a distraction from my short term rental business. I've hired cleaners in house & covered for some local owners for a couple of months while they were out of town, and it's not very straightforward. After that period, I definitely did not want to get into the cleaning business.

Jeremy Jareckyj · Answer

One incentive I have seen people use to get good cleaners is to give them a certain percentage of the rental income (1-2%) plus their cleanings feeds. I have also experienced owners give cleaners a bonus for every certain amount of 5 stars they get in the cleaning category!

Michael Baum · Answer

Cool beans @Andrew Steffens. Like I have said a bazillion times, this is a cool place!

@Kristi Miller, I love that idea actually. How many rentals are in the immediate area where you want to build up the business?

Chelsea Brindle · Answer

What about PM companies that designate a person to look over 1099 cleaners? Like a PM with their specialty being to ensure cleanliness

Philip Ray · Answer

I was about to open a cleaning business in an area that caters to STRs, but finding reliable cleaners proved to be quite a challenge. Some of the benefits I offered included a steady schedule, above-market pay, and verified clients. However, it seemed that nothing impressed the cleaners I interviewed. Many of them were listing their services on https://pro.aroundwire.com/, and preferred to avoid working for an agency or company.

I’m not sure how you guys are building a monopoly in such an unpopulated area, but keep up the good work.

Andrew Steffens · Answer

Hi! You can reach out to them on Airbnb/VRBO, a lot of cleaners do that to us by sending messages on their platforms, however if they report you they make kick you off. You can google search companies and try to get in touch with management to see if they have need. You can also go to local meetups to meet people directly! Also advertising on the classifieds here. There are some pay sites like thumbtack too.

Has anyone started a STR cleaning company (or PM company)?

Has anyone started a STR cleaning company (or PM company)?

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