Here’s a step-by-step analysis of what you need to get started –
Step 1 – Choose Your Business Entity
Before you start any janitorial business, you must settle on the business entity.
If you’re planning to hit the markets with a mop and bucket as a one-man show, you can register as a sole proprietor, and you’ll be responsible for taxes and liabilities of your janitorial business.
If you’re planning to work with a team of cleaners, partners or managers, you’ll be better off registered as as this will offer you better liability protection.
This means when cleaners cause damage to articles in customers’ homes/offices, your company would be liable for those payments and not you personally.
The best way to go around this is to consult a private attorney or tax advisor to receive suggestions for an appropriate business entity suiting your business requirements.
**Your legal obligations will depend on the type of entity you choose to proceed with.
Step 2 – Registering Business Name
Firstly, you’ll need to register a business name with the State of California. You can find details about the name registration here.
Step 3 – EIN & Business Entity Registration
- You can get it for free from the IRS website. This will allow you to open a bank account, file taxes, and get loans.
- After you acquire an EIN, you can proceed to register your business as a legal entity (LLC, LLP, CORP).
Next off, you’ll need to acquire an Employment Identification Number (EIN).
Step 4 - License & Permit
The license and permits you require to successfully run your California-based janitorial business vary in accordance with the counties or cities your business is based in.
Simply visit CalGold, a website run by the California Governor’s Office of Business and Economic Development, to assist you with the legal requirements.
Once you visit the website, type in your city/county and enter your business type e.g. ‘Janitorial Cleaning Maintenance Services’.
You’ll be directed to all the legal papers you require to operate your business.
Step 5 - Banking and Taxation
Once you’re done with the local requirements, you’ll need to open a bank account with your Business details (name, address, etc.)
This will allow you to file your tax files, which include -
Based on the category of your business, you’ll be expected to pay a number of federal taxes, registered under the IRS.
Running a business in the State of California requires you to file a tax certificate with the State of California Franchise Tax Board. Businesses with income inside and outside California may fall under this category.
Sales Tax Certificate –
This allows you to officially charge Sales Tax from your clients and potentially saves you from Tax evasion charges. Sales Tax registration of the California Department of Tax and Fee Administration
If all of this goes above your head, you can hire an accountant to do the job for you.
Step 6 - Health & Safety
Janitorial jobs can sometimes lead to accidents.
Your employees can slip on wet floors, or they can be exposed to hazardous/toxic substances (from cleaning agents).
So, you should take preventive measures to avoid such unforeseen problems.
You’re required to prepare an Injury and Illness Prevention Plan for meeting the Division of Occupational Safety and Health (DOSH) requirements.
Additionally, you’ll have to be compliant with a few other regulations as laid out by Occupational Safety & Health Administration (OSHA).
Step 7 - Insurance
There are many risks associated with a Janitorial Business. You’ll need insurance to back you up in most cases.
From health safety to the safety of property, be it for yourself and your employees or that of your clients, you’ll require insurance to cover any unforeseen damage or loss.
Based on local standards and regulations, you may also require bonding for your business.
Step 8 - Advertising
To get your business up and running, you’ll require successful advertising.
This can be in the form of flyers, posters, websites, social media advertisements, cold calling, email lists, and many more.
Just make sure not to engage in a false advertisement, and you’re good!
Step 9 - Terms and Conditions
- Make sure to layout clearly and precisely the terms and conditions of your services
- You can do this by posting your policies on your website and other platforms
Furthermore, you should draw up contracts for each of your clients for every term of work you engage with them.
This contract is a legal paper that includes policies and should protect both parties (both you and your client) from any discrepancies or exploitation caused during the service.
These policies can include standard operational procedures like -
- Whether the cleaner should open a door if the doorbell rings.
- Whether to clean electrical appliances or not.
- How to proceed during uncalled situations or lack of supervision.
Step 10 - Employment
Educate yourself in the local employment laws when starting a janitorial business in California.
This will help you with insights into your hiring process, worker compensation, workplace ethics, and worker eligibility.
Stay updated with the IRS and the US Department of Labor to stay on top of the employment protocols.
End Note
Starting a business always comes with its own set of challenges. Stay strong and be patient. Follow the steps we’ve discussed above and you should be well ahead on your journey in starting your own Janitorial Business in California!
Alternatively, our janitorial appointment setting program could help you land more commercial cleaning work in your area.
