1.1 Environmental analysis
Demand for cleaning services industry in Australia is increasing every year. According to Smart Company (n.d.), its revenue in 2007 was equal to $3.2 billion, while IBIS World’s Commercial Cleaning Services market research report states that in 2014, this amount was equal to $8 billion (IBIS World 2014). The same report says that there are approximately 27,000 businesses and 121,000 employees in the industry. The concentration level is low. Four big companies received around 16% of the industry’s revenue in 2014. It happens due to a large number of small businesses. Overall, the industry analysis shows that the demand for cleaning services will continue to grow due to the following reasons: increasing population (the number of older people increases faster) and rising per-capita income (Australian Bureau of Statistics 2012). Moreover, the amount of disabled people is also increasing. Thus, it is high time to enter the market. The best place to start this type of business is a small city in a province because there are too many cleaning services in big ones. Launceston is an ideal place. With a population of more than 100,000 citizens, it has around 70 cleaning firms in the city and outskirts (Yellow Pages n.d.). However, many of them provide only specific services while the market requires the modern firm to be flexible and offer different ones. Moreover, it is easy to start a cleaning company, as the personnel is cheap and does not require any education or rich experience.
1.2 Product service strategy
The majority of cleaning companies offer the following products: industrial and commercial cleaning, floors cleaning, windows and floors cleaning in homes, offices, and others. Usually, the majority of cleaning firms do not provide carpet, steam or shampoo cleaning or other uncommon services. The new Be Clean Company will provide a full range of services, starting from regular ones and finishing with garden cleaning, roof cleaning, and others. The company will work with everything that can be cleaned. If there will be no price for the service that customer asks, Be Clean will offer a special cheap price to such kind of clients and later include it in the service list.
1.3 Customer strategy
There are several major customer groups for Be Clean Company. The first one consists of men and women aged 35 – 60, who works hard every day and does not have enough time to clean their flats or homes. The second group consists of disabled people (male and female) aged 60 – 90, that is not strong enough or simply ill and physically cannot complete some cleaning procedures. The last customer group consists of small and middle offices, with up to 50 employees. Geographically, they are located all over the city, but due to its relatively small size and absence of traffic jams, it is not so important.
1.4 Competition and competitive advantage
According to One Flare (n.d.), the top twelve competitors are Bennett Cleaning & Gardening, Fionas Cleaning Service, Jayfer Cleaning Industries, Launceston Home Cleaning Experts, In-Depth Cleaners, Pride clean, Love to clean, Roger Lockett’s Cleaning, Golden Ace Cleaning Contractors, Dial-A-Genie, Affordable Cleaning Service, and Service Master. The major disadvantage to most of these firms is that they provide only a limited number of services. Another important issue is that few of them have websites and online ordering services. Competitors’ prices vary due to the service. For example, Launceston Home Cleaners offers $50 package + $25 per extra hour for the home with two bedrooms and one bathroom, which is one of the cheapest prices. Be Clean’s competitive advantage will be a wide range of services, ability to order anything online through the website or smartphone applications, discounts for loyal customers, and special offers.
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1.5 Price strategy
First of all, the prices in Be Clean Company will depend on the competitors’ ones. Thus, it will use competitive pricing technique. Moreover, it will use optional pricing, in order to maximize the profit. The company will offer its customers additional cleaning services for a low price in order to increase loyalty and firm recognition. Overall, the prices are going to be 20% to 30% lower than the average in the city because it is a significant advantage. If customers like the quality, they will prefer to Be Clean’s cheaper service.
1.6 Advertising and promotional strategy
First of all, the company will be advertised in Yellow Pages. Moreover, Be Clean will put their commercial on 10 to 15 billboards all over the city to make the brand recognizable. Additionally, there will be short advertisements in several magazines and periodicals, like Tasmanian Life Magazine, Transporter Magazine, and others, as well as order internet banners on news websites. There will be no advertisement on TV or radio, as it is very expensive and not so effective. The company will not run any direct marketing campaign. However, Be Clean will ask customers to leave their emails since in the nearest future they will run a newsletter, where they will be able to learn about new offers and discounts. Loyal customers will also receive additional discounts.
1.7 Market research strategy
Be Clean will face several challenges after creation. First of all, there are a lot of existing cleaning companies while the city is not too big. Thus, the company will need to offer competitive price and services in order to attract new customers. It is important for Be Clean to offer a wide range of services, as the majority of competitors specializes in several ones. After its launch, the company will regularly add new services to the list. In the future, the company might add new customer groups, like shopping malls, public service buildings, and others. In order to achieve it, the company will have to be able to compete on tenders. Additionally, the company will have to be aware of competitors in order not to miss new services and opportunities.