Increase Client & Cleaner Retention by Pricing Right as a Domestic Referral Agency
Updated: May 13, 2020
When just starting out with your domestic referral agency, pricing can be a big question mark. It can be a struggle to know, on the one hand, how much to charge clients, and, on the other hand, how much to compensate independant cleaners. AND with all that to balance, you still have to create a viable business model to make enough money. What to do?
Now, do not be disheartened when I say there are no hard and fast rules. There are answers, but the answers are specific to your area. That is actually a good thing. It lets you take the temperature of your specific area and make a decision based on your investigation. The investigation consists of finding out what is being charged by two tiers of pricing.
1. What are cleaning companies charging in your area?
2. What are independent cleaners in your area charging their private clients?
The experience you seek to offer clients will probably fit mid way between these two options. Once you get the results of your investigation, the price you want to offer clients will probably fall nicely in-between these two price points.
Tip: If you're in California, check out California Coalition of Domestic Referral Agencies, a non profit group helping referral agencies understand the law and how to operate in compliance. One thing I learned from them is independent cleaners have to earn the majority percentage of what is charged to clients. https://www.ccdra.org/
The Company Experience
This is the top tier pricing. What are national brands in your area charging? Finding out what companies like Molly Maids or Merry Maids charge will give you an idea of what price point you may not want to exceed.
The Independent Cleaner Experience
This is the bottom tier pricing. If most of the cleaners in your area charge $20-$25 per hour, you will know what an independent cleaning professional will be expecting to be compensated while working with your agency.
The Referral Agency Experience
The goal is to be somewhere in the middle of what companies charge and what independent cleaner charge their clients. If an independent cleaning professional is accustomed to making $20-$25 per hour, they will likely be agreeable to that compensation from an Agency, especially if you emphasize that they will be benefiting from the added benefits of what the agency will provide. These can be a great selling point to an independent cleaner. Be sure to mention advertising and marketing to get more clients, taking care of billing, providing customer service, and phone sales. This reduces their non-billable time down to practically nothing. Pointing out these benefits also highlights the fact that the cleaner does not sacrifice as their pay remains the same while the percentage that the agency collects is paid by the client for these services.
Client retention is important, but so is cleaner retention. The independent cleaning professionals that receive 60% should not feel that the agency takes 40% of their wages. They should feel they get their full 100% while the agency receives payment from the client for services such as: screening and vetting all the cleaners, assuring each has the qualifications to do the job, and background checks as well as many other services provided by the Agency to the client.
Cleaner Retention is Client Retention
A cleaning professional who understands the Referral Agency concept will be less likely to steal clients because they should feel that they are getting what they want, essentially for free, and the client is paying the Agency for separate services provided.
You still want numbers? Ok. I have heard anywhere from 50%-75% going to the cleaners. After my investigation of my area, I chose to pay my cleaners 60%. This was based on what I can justifiably charge clients in my market and what makes sense to pay my cleaners.
Use these tips help you to find what your market dictates.
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