Cleaning Business Loans

Industry overview

It’s easy to see why business owners are looking to enter the cleaning market; the UK cleaning industry contributes around £66.9 billion each year and employs over 1.4 million people. It’s a lucrative but busy industry, and getting access to the right small business loan can help you stand out from the competition.

Whether you’re entering the market for the first time as a sole trader or looking to level up your limited company, there are plenty of cleaning business loan options to consider.

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Types of cleaning business loans

Unsecured business loans

An unsecured business loan is the quickest type of business loan you can apply for. After loan approval, you can see funds in as little as 24-48 hours. You don’t need collateral, but some lenders might insist on signing a personal guarantee to lessen the risk.

Secured business loans

If you have high-value assets you don’t mind risking, you can access a secured business loan with favourable repayment terms, interest rates, and large loan amounts. You might want to also consider a secured loan if you want to complete sizable cleaning business renovations or you want to expand to additional premises.

Asset finance

You can use asset finance to lease or hire equipment, or use it to release funds tied up in your current assets. As a cleaner, it’s inevitable you’ll need high-quality cleaning equipment, and asset finance can help you acquire these items so you don’t deplete your cash. By paying for essential equipment over a period of months or years, you can ensure payments are manageable while getting your hands on the highest quality equipment, giving your business the best chance of succeeding.

Merchant cash advance

If you accept card payments from customers, you might be eligible for a merchant cash advance. These are particularly useful if your business is seasonal, because repayments are a percentage of your card sales. So the months you do better, you repay more, and vice versa. This is a good option if you don’t want to repay in fixed monthly instalments.

Invoice finance

Once you invoice your clients, you’re waiting 30, 60, or sometimes 90 days for payment (particularly from commercial clients). These invoice terms can put a stop to business operations. But with invoice finance, you can immediately access up to 95% of the unpaid invoice amount. Invoice finance isn’t traditional debt; you don’t take any debt on, so if you’re looking for a lower-risk business finance solution, invoice finance might be it.

Government-backed start-up loans

If your business is less than 36 months old, you might be eligible for a government-backed start-up loan. You can borrow between £500 and £25,000, with the maximum amount any business can access being £100,000 (each partner can apply for £25,000 each).

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Finance for commercial cleaning

Nearly 450,000 people work in the commercial cleaning industry, which sounds daunting, but it’s a good sign for business owners entering this market. That’s because you’re not tapping into a brand new market; it’s an established and thriving one already.

Just like with many commercial-facing businesses, there can be a cash flow gap between completing the work and getting paid for it. Commercial jobs might cost you more upfront; for example, you’ll probably need commercial-grade equipment like a Numatic compact floor scrubber dryer, which can set you back over £2,000.

In this case, you’re out of pocket by over £2,000, but the invoice terms are 60 days. Accessing a cleaning loan can help you plug these cash flow gaps and keep operations running as you scale.

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Finance for domestic cleaning

Starting a domestic cleaning business has relatively low barriers to entry. That’s because all you need are some cleaning supplies, customers, and public liability insurance. There are no legal or mandatory qualifications or licenses needed to become a domestic cleaner.

But initially, you have to pay upfront costs to purchase all your cleaning products and supplies, such as a good-quality hoover, carpet cleaner, oven cleaner, limescale remover, and cloths. You also need to consider how you’ll get to customers’ houses; you might need a van or a car if you don’t already have one. You might want to brand your van or run local marketing campaigns. All this requires a small upfront investment to get your business up and running.

And if you don’t have the necessary working capital or you don’t want to deplete your personal funds, you can apply for a business loan.

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Am I eligible for a commercial cleaning loan?

Each lender's criteria vary, but if you meet the following basic requirements, there’s a high chance you’ll find a loan suitable for you:

• A comprehensive business plan. For startup businesses, particularly, lenders want to see how you plan to make money and understand your cash flow forecasts.
• Bank and financial statements. Lenders will want to see the last few months of business bank statements to prove turnover and help them understand spending habits.
• A good credit history will help you secure better loan rates. There are loan options available for bad credit.
• UK-registered business and bank account. Your business must be a UK-registered limited company, limited partnership, or sole trader with a UK business bank account.

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How to use your cleaning business loan for growth

After you get your hands on the funds, you can use them however you like to grow your business. Here are some ideas about how you can best use your new capital:

Branding and marketing

Getting the word out about your cleaning business is essential for growth. You can use your loan to trial new marketing channels or strategies to reach more potential customers. Branding your vehicle can also be a great way to succinctly communicate what your brand does as you drive around the local area.

Insurance

Many commercial clients won’t hire you without public liability insurance. You’ll also need employer’s liability insurance in place if you hire staff. You can use your loan to pay for the year’s insurance in full can help you save money on interest and administrative fees.

Use your loan to purchase all your high-quality equipment to ensure your business can perform cleaning services to the highest standards.

Hire staff members

If you’re taking on large commercial cleaning projects, you might need to hire help. Your commercial cleaning loan can help make sure wages are covered from the very start.

Software

You might benefit from accounting software like QuickBooks or home service software like Jobber. You can use your loan to pay for subscriptions like this to make your business more professional.

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Why choose Capalona?

Our free business loan comparison tool helps you find and compare eligible commercial cleaning business loan options.

Getting a quote is quick and simple. Provide a few details about your business and your funding needs, and we’ll instantly show you the loan options available to you.

It’s free to use, you’re under no obligation to accept any quote, and it won’t affect your credit score.

Compare cleaning business loans.