Thread by @LiamKircher

Cleaning Business with STR Management

$40-45k/Month Gross Rent - Collecting 25%!! THAT is what I was missing out on!

🧵

1/ I never realized how many opportunities were in the STR Management space.

Are the rates and demand 100% in correlation with the location I'm in? YES. I am fortunate with my location.

BUT I honestly believe that you have the ability to do this in most cities.

2/ I came to this conclusion by cleaning many different vacation rentals. In an average summer, we do around 20-30 vacation rental cleaning turnovers in a week.

I started noticing that we were handling a ton of the management...

3/ I was getting fooled and doing work for FREE on top of cleaning services.

STR homeowners were having us:

- Checking guests in when the cleaning was completed
- Doing maintenance checks.
- Being present for home deliveries
- Changing BBQ propane tanks
- Pool Refilling

4/ We are the cleaning company...WE SHOULD NOT be doing these management tasks as a cleaning company.

Then I started analyzing it a little more.

Numbers do not lie so let's walk through the numbers.

5/ Avg STR Turnover Cleaning: $260

Cleaning Duration: 4 Hours

Net Margins: 30%

Net Income: $78

(I understand volume is the name of the game with cleaning BUT the amount of work we were doing does not justify this net income.)

6/ Even Conservatively Speaking (I broke this down weekly as we do a turnover once a week for most STR homeowners.)

Avg Nightly Rate: $1,300

Weekly Booking Gross: $9,100

Net Margins: 25%

Management Net Income: $2,275

7/ WTF am I doing... I was missing out on a SHIT ton of cash.

I started thinking, how hard could managing an STR really be... we already do most of it when we shouldn't be and the rest of it is most likely just some customer services tasks and pencil pusher-type work.

8/ I am a firm believer in easier routes to life and business and harder routes to life and business.

100% I could have become a millionaire from my cleaning business, and I truly believe it's possible for anyone to do that also!!

9/ BUT, what I understand now is that it would take much longer than an industry such as STR Management where the net margins are almost identical to cleaning but the gross revenue numbers are insanely higher. In addition, a cross-industry such as this is perfect.

10/ Cleaning and STR Management go hand and hand.

I am launching an STR Management company this month and this idea came from my cleaning company. I always tell people who are interested in starting a cleaning business...

11/ "What is your why, and why do you want to start a cleaning company?"

My "why" was cash flow and leverage.

I have no passion for cleaning but it was amazing leverage to allow me to work on other businesses and industries that I love.

12/ I am using the cash flow from my cleaning business to help launch this STR Management business.

Get the cash flow first, then go find your passion projects and the businesses you always wanted to start.

13/ Some Conclusions -

1. Focus on cash flow first then pivot and use that cash flow as leverage to work on things you are interested in.

2. Do not let customers take advantage of your services. If someone is demanding more services they need to pay more.

Cont👇

14/

3. Don't let people make you think their business or industry is harder than it really is. Most likely it's simpler than you are lead to believe.

4. Always be self-aware with your business. Sometimes niches within your industry can be very lucrative.

Cont👇

15/

5. Use your "why" to figure out what route you want to take in life.

6. Understand that life and business has harder routes and easier routes. Do not be the majority and be afraid to pivot industries when the time comes.

7. There is nothing wrong with starting over.