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How to finance a cleaning service

Explore funding options to start or expand your business.

Financing is an invaluable tool for both new and established cleaning services. A wide variety of loan options are available to businesses of all sizes — so your best option will be to narrow down your specific needs before applying with a lender.

8 ways to finance your cleaning business

New and established cleaning businesses can choose from any number of options, depending on the need.

Business loans

A business loan is a good choice for an established cleaning service looking to expand. They can be used as a source of working capital for marketing, hiring employees and purchasing storage space — all key for building out your business.

You will need to have a few years in business to qualify for most term loans — and present a strong business plan. But your options are endless. You can look to banks, credit unions and online lenders for funding, and your business may even qualify for a Small Business Administration 7(a) loan, which means low rates for larger amounts.

Business lines of credit

Business lines of credit provide more flexible access to working capital for cleaning services. If your work is seasonal or you have a fluctuating amount of clients, a line of credit can help you keep things running when business slows. And like term loans, they're available from a wide variety of lenders to suit businesses at every stage of development.

Microloans

Microloans are small, unsecured business loans for owners who may not need or qualify for large loan amounts — you could potentially borrow as little as $25 with services like Kiva. However, the turnaround may take up to a month, especially if you use a crowdfunding system. For cleaning businesses that need money for small supplies, it may be easier to turn to a business credit card.

Equipment financing

If you need industrial equipment for commercial projects or want to invest in new transportation, an equipment loan may be the best choice. These typically have lower rates than unsecured loans and may be easier to qualify for if you are a new business owner.

Business credit cards

Business credit cards allow you to make smaller purchases — like cleaning supplies — under your business's name. Provided you pay them off before the end of your billing cycle, they can be a useful way to finance your cleaning service without spending money on interest.

Short-term business loans

Short-term business loans are an expensive option best used when your business needs a quick influx of cash. If you take payments through credit cards or receive invoices from commercial clients, then you may be able to use a merchant cash advance or invoice factoring to help get through a dip in revenue. However, the fees are more complicated than traditional business financing — and payments are usually made daily or weekly.

Personal loans and credit cards

A personal loan or credit card may be helpful if you're just getting started. If you only need to fund licensing, insurance, marketing and basic supplies, you can use a card you already have or apply for a small personal loan. While the rates won't be as competitive as options geared toward businesses, they are much easier to qualify for. Just make sure the lender allows you to use the funds for business expenses before you apply.

See top business loans for your cleaning business

To start your search, select your loan amount, annual revenue, time in business and personal credit score. Then click Show loans.

Name Product Filter Values Loan amount APR Requirements

Fora Financial business loans
Finder Rating: 4.1 / 5: ★★★★★

Fora Financial business loans
$5,000 – $500,000
Varies
6+ months in business, $12,000+ monthly revenue, no open bankruptcies
Get qualified for funding in minutes for up to $500,000 without affecting your credit score. Best for companies with at least six figures in annual revenue.

Lendio business loans
Finder Rating: 4.75 / 5: ★★★★★

Lendio business loans
$500 – $5,000,000
Starting at 6%
Operate business in US or Canada, have a business bank account, 560+ personal credit score
Submit one simple application to potentially get offers from a network of over 300 legit business lenders.

National Funding business loans
Finder Rating: 4.75 / 5: ★★★★★

National Funding business loans
$5,000 – $500,000
4% to 8%
Be in business at least one year and make at least $150,000 in annual sales. Other loan types have additional requirements.
Working capital loans and equipment financing, some high-risk industries may be eligible.

Fundbox lines of credit
Finder Rating: 4.2 / 5: ★★★★★

Fundbox lines of credit
$1,000 – $150,000
Not stated
6 + months in business, $100,000+ in annual revenue, 600+ credit score
Get flat rate, short-term financing based on the financial health of your business, not your credit score.

Bitty Advance business cash advances
Finder Rating: 2.8 / 5: ★★★★★

Bitty Advance business cash advances
$2,000 – $25,000
Not applicable
$5,000 monthly bank revenue, 6+ months in business, business bank account open 3+ months, 450+ credit score
With APRs in the triple digits, this is best saved as a last resort.
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Compare up to 4 providers

What you can use a cleaning business loan for

Like most business loans, you can use your funding for a variety of purposes, including:

  • Supplies
  • Equipment
  • Licensing
  • Permits
  • Marketing
  • Employees

Your lender may have some restrictions, but in general, you should be able to use your funds for whatever your cleaning business needs.

What to consider when comparing business loans

Once you know the type of financing your business needs, consider these five factors when selecting a lender:

  • Loan amount. Ask your lender what its upper and lower loan amounts are. If you need more than the maximum — or less than the minimum — pick a different lender.
  • APR. Most types of financing will have a maximum APR of 36%. The lower the APR, the less you'll spend on interest and fees. And the less you spend, the more money you'll have to invest back into your cleaning business.
  • Term. The type of financing you choose will determine your loan term. The longer your loan term, the lower your monthly repayment — and the more you pay in interest. Strike a balance between loan term and monthly payment to get the most out of your loan.
  • Fees. Origination fees and prepayment penalties are common and can quickly add to the cost of your loan. Try to find a lender that charges neither. At the very least, pick one that charges less than its competitors.
  • Eligibility requirements. Banks tend to prefer established businesses with at least $100,000 in annual revenue, while online lenders can have less strict requirements. If you don't meet the business or personal eligibility standards set by your lender, you won't be approved.

How to improve your odds of approval

Lenders want to see that your business has a well-informed business plan and budget. When you're ready to apply, you should know information about your market — whether that's residential or commercial cleaning, the area you plan on working in or the type of equipment you need for large projects.

For new business owners, lenders will also want to see that you have experience with professional cleaning and management. While it's not always a requirement, you will need to have at least a year in business and a high monthly or annual revenue to qualify for most loans.

How much does starting a cleaning business cost?

Cleaning businesses have lower startup costs than many other businesses — largely because you only need to invest in basic supplies and marketing. Since there's no need for formal training or certification, you can realistically begin your business with your own supplies while using your social network to find prospective clients. But if you plan on buying an existing franchise, you should still expect to pay at least $15,000 in startup costs.

How much it costs to buy an existing franchise

Franchising fees typically run between $10,000 to $50,000 or more — and that doesn't include the working capital requirement. These vary by business, so we've compiled a list of the top residential and commercial cleaning services to demonstrate the potential cost.

360clean

Commercial

$10,0000

$15,000

Jan-Pro

Commercial

$3,100–$60,000

Varies

Merry Maids

Residential

$37,500–$51,500

$35,000

Molly Maid

Residential

$14,900

Varies

ServiceMaster Clean

Both

$69,500

$85,000

Stratus Building Solutions

Commercial

$7,500–$575,000

Varies

The Cleaning Authority

Residential

$30,000–$65,000

$50,000

Vanguard Cleaning Systems

Commercial

$2,500

Varies

Information is from Franchise Direct as of September 2020. Keep in mind that this table doesn't cover the full range of franchise opportunities or the total costs. If you're interested in franchising with a company, contact its management team to learn more details about the expense and how to start the process.

How much it costs to start an independent business

Starting an independent cleaning business may only run you a few thousand dollars. In general, cleaning services have much lower startup costs than other businesses. Your main startup costs will be limited to basic supplies, marketing, insurance and licenses. The exact expense will depend on your area.

However, purchasing extra storage space, a business vehicle or specialized equipment can be costly. Your niche will also influence the cost — industrial cleaning supplies for commercial work will likely run you more than residential cleaning supplies.

5 tips for running a successful cleaning business

The success of your business depends on you — these tips can help you get ahead when you're just starting out.

  1. Understand your local market. Your area should play a role in the services you offer. If there are cleaning businesses already working, you need to know how to stand out. The type of clients you can snag will also depend on where you want to work.
  2. Invest in a specialty service. The type of cleaning you do will also influence the clients you have and competition you face. If you can offer a specialty service — like sanitation of office spaces — you may be able to snag a niche other businesses haven't invested in.
  3. Stick to a budget. Supplies will be the most common cost to your business, but don't discount marketing when trying to reach clients. And if you plan to expand, you'll also need to have room in your budget for additional employees and transportation.
  4. Keep up with licenses and insurance. Although the exact cost will depend on your area, you will need liability insurance on top of the licenses and permits your municipality requires for you to operate a small business.
  5. Develop strong relationships with clients. Your clients are your bread and butter. When you're starting out, word of mouth will be your ally. As you expand, having good reviews will also help you earn new clients while keeping your current ones happy.

Bottom line

Starting a cleaning business — or finding funding for your established service — is relatively simple. Provided you know what you're looking for in a loan, you should be able to compare business loans and choose the right lender to take your business to the next level.

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