Sanz Solutions, Inc., a Florida corporation, offers shared service solutions for small businesses that provide routine services for residential and commercial clients specifically focused on the janitorial, cleaning, lawn care and maintenance industries.
Sanz Solutions provides a multitude of programs and benefits to assist independent business owners and small companies better service their clients. By pooling resources, these companies are able to access professional expertise, guidance and services that would otherwise be cost prohibitive. The company's initial service center will be located in Miami Lakes, Florida. Intended services offered at Sanz Solutions' centers include communications, marketing, public relations, administrative, accounting, financial, tax, information technology, human resources, and legal services.
Sanz Solutions target market is the janitorial, construction, cleaning, lawn care and maintenance industries because this market is primarily comprised of independent business owners and small companies who lack the resources to obtain the professional expertise and guidance necessary to ensure company growth and success.
Industry and Competition
Janitorial and Cleaning Industry
The cleaning industry can be roughly divided into residential cleaning, commercial janitorial services, specialty cleaning and laundry/dry cleaning services. In 2015 there were approximately 875,000 businesses employing about 3.5 million people.
The industry as a whole is very susceptible to economic downturns and suffered when revenue fell 5.3% in 2008 and another 6.1% in 2009. General cleaning services, and particularly residential services, are considered to be an expendable luxury during financial difficulties. However the industry as a whole has strengthened over the past few years, and in 2015 generated $51 billion in revenue. Strong economic activity is forecast for the next 5 years as well, and the Bureau of Labor Statistics is predicting job growth of about 6% from 2014 levels to 2020.
The industry is highly fragmented, consisting of both public and private businesses and self-employed workers. The two largest players in the industry are ABM Industries and ServiceMaster, a publicly traded company that owns several national franchises such as The Maids International, Molly Maid and The Cleaning Authority. ABM Industries is also publicly traded but focuses more on providing integrated facility solutions to commercial and industrial markets. The rest of the industry is made up primarily of small, independent contractors. Small, independent janitorial companies account for 70% of the cleaning contractors.
Lawn Care and Maintenance Industry
This industry includes landscape and lawn maintenance, landscape contractors, landscape architects, irrigation contractors, and lawn and landscape product suppliers. The landscape industry in the United States employs almost 1.6 million workers and generates almost 959,000 jobs in other industries. The landscape services industry has annual revenues of $78 billion, annual growth of 3.9%, employs 969,257 people, and represents 474,237 businesses. It is estimated that the lawn care services sector alone generates about 704,000 jobs and $35.6 million in value-added services annually in the US.
Over the five years to 2016, growth in the domestic housing and property markets have led to greater demand for landscaping services. Over the next five years, steady per capita disposable income growth is projected to encourage households to continue outsourcing yard care. Moreover, general economic recovery will likely boost commercial expansion, driving the need for industry operators that can maintain large corporate and resort campuses.
However, this industry is highly fragmented and the top 50 lawn care services companies generate about 15% of the total revenue in the industry, and the remaining 75% percent of the lawn care / landscaping industry is driven by small business owners.
Challenges to Small Businesses Competing in Service Industries
The janitorial industry and the lawn care industry are both service oriented industries that are overwhelmingly comprised of small independently owned small businesses. Small businesses in the service industry face specific challenges which attribute to nearly half of all new companies failing within the first year and 75% within five years. Lack of proper tools and resources to handle these challenges results in the average cleaning company losing up to 55% of their customer base every year due to poor service.
Many small business owners face unsurmountable difficulties and challenges as they pursue their business model. Such times when these entrepreneurs need expert advice, guidance, and assistance from business professionals, they lack the resources to engage the help required. Without proper guidance, access to best practices and proper information, these owners struggle or completely fail.
In these industries, a majority are run by less than 5 employees and require the owner to focus on areas outside of their scope of expertise and away from areas that promote growth and customer retention.
One of the largest factor contributing to the downfall of a small business is the lack of time management. Small business owners perform several tasks that can take up time on their daily schedule. Entrepreneurs often find it difficult to balance a schedule that includes sales and marketing activities, the search for financing, product development, accounts payable, accounts receivable and business development. Generally these items are not the entrepreneurs strongest skill sets, and as such, take the owner longer to complete, and are done without the care and diligence of a professional in that field. If a small business owner is unable to hire help in these areas, it can be difficult to give every aspect of the business the attention it requires.
Employee Training & Turnover
Small operators also suffer from employee turnover, and poor staff training. Poor staff training is especially damaging to this industry as customer service and retention is key to success. Training and ongoing training are crucial in order for a cleaning company to survive and thrive. However, high employee turnover creates an ongoing obstacle to proper staff training. Small businesses struggle to attract and keep top talent that can help them move ahead. Employment packages that include health benefits, vacation days, sick days and profit sharing are common with larger corporations. Small businesses have a problem competing with these kinds of employment benefits. Higher wages from larger corporations also attract employees away from small businesses and make it difficult for small businesses to reduce employee turnover.
Small businesses in the service industry are also susceptible to accounts receivable delays that can cripple the company if not handled properly. Many of these businesses lack the resources to offer advanced technology payment solutions or a dedicated accounts receivable department to ensure proper and timely payment needed to maintain cash flow. Slow collections can be detrimental to the continued operations of a small service business. The service industry is especially vulnerable to this area, as the company typically outlays the cost for the service - ie the labor and supplies, and does not collect until after the job is complete. Small businesses must pay for the labor costs and supplies to complete a job even if the client does not. Small businesses can run out of capital very quickly if finances are not budgeted properly and if clients delay payment.
Marketing and advertising are an important way for any business to reach new clients, and with a limited marketing budget it can be a struggle for a small business to reach its target audience. Advertising can be expensive; and even with the many forms of free marketing available on the Internet (social networking websites, blogs, company websites), it is still difficult to reach a target audience without investing in other forms of marketing such as television and print. Many small business owners also lack the knowledge or skill to manage online technology, and do not have the resources to hire web professionals to maintain a company website, social marketing, and search engine optimization(SEO).
Access to New Technology
When new technology is introduced, it can be expensive to implement. A small business may not have the financial or technological resources to take advantage of new technology that a larger company may have, and this puts the small business at a distinct disadvantage in the marketplace.
Sanz Solutions Shared Services Centers
Sanz Solutions will establish shared service centers that provides a multitude of programs including communications, marketing, public relations, administrative, accounting, financial, tax, information technology, human resources, and legal services to assist small companies in the janitorial, construction, cleaning, lawn care and maintenance industries better service their clients. By pooling resources, these small companies are able to access a wealth of features and savings that would otherwise be cost prohibitive.
Consistent High Quality Customer Service
At the heart of Sanz Solutions is the belief that by combining resources, small businesses will be able to provide consistent, and excellent customer service. To this goal, the Customer Service departments will offer a variety of solutions, including appointment scheduling, customer relations, customer follow up and standardized retention policies. By utilizing a central customer service department, companies can eliminate redundant activities and improve efficiency, services and overall customer satisfaction. Employees will receive high level training and ongoing training to ensure the goal of exceeding customer expectations.
Human Resources Division
Sanz Solutions Human Resources Division intends to provide customers a full range of HR services including employee labor relations, equal employment opportunity services, payroll, benefits administration, employee relations, employee records management, recruitment, screening, classification services, reporting, strategic planning, workforce planning, and personnel transactions.
Sanz Solutions financial department intends to provide assistance with accounting services, audits, developing budgets, managing funds, federal and state taxes, accounts receivable and accounts payable. Services also include payment processing solutions to include credit card processing, online payment systems, automatic and recurring billing.
Advertising & Marketing
The Advertising and Marketing department intends to offer a multitude of services to small businesses and provides professionally developed marketing campaigns specifically designed to capture targeted markets. This division provides support for brand awareness and recognition, business identity packaging, marketing campaign tracking, online marketing and social media branding, and inclusion into joint marketing programs.
The legal department intends to offer services for drafting proposals and contracts, as well as guidance and review of agreements, contracts, federal regulations, directives and legislation.
Sanz Solutions is a business model that allows small businesses to leverage resources across the entire organization and provide services to multiple business units resulting in lower costs. Sanz Solutions is built to be internally focused on providing services to small businesses with the goal of high quality, critical services that directly support customer satisfaction and company growth.
Sanz Solutions intends to provide multifunction shared service centers offering services and solutions specifically developed and tailored for small businesses in the lawn care, maintenance, janitorial and cleaning industries. Services offered to clients include Customer Service and Relations, Human Resources, Payroll, Accounting, Accounts Receivable, Advertising and Marketing, and Legal Review.