Clean Without Soap

The Market

The current world market for cleaning services exceeds 150 billion dollars. Of this amount more than 60 billion is generated in Europe and nearly 50 billion in the US alone. It is probably the most entrepreneurial and labor intensive sector in the world with growth rates hovering around 10 percent for years in a row. There are 135,000 cleaning contractors in Europe, and 386,000 in the USA. Worldwide about a million companies provide professional cleaning services. The European cleaning business employs 3.5 million staff, three quarters on part time and on the average they work 24 hours per week. Three out of four employees are women. The US employs just under one million, indicating that the size of individual companies is very small indeed.

Cleaning services benefited from a rapid expansion because of the wide application of outsourcing by both the private sector and the government. Market penetration has reached in Europe nearly 65 percent, implying that two thirds of companies and agencies have opted to contract out their cleaning services, instead of employing in-house staff. While there are hundreds of thousands of small companies, some large conglomerates have emerged like ISS from Denmark and ABM Industries Inc. in the USA. ISS operates in 50 countries worldwide and employs 485,000 staff to handle some 200,000 business to business clients. Over the past decade ISS has acquired more than 600 companies thus fueling its growth strategy by professionalizing the sector.

The growth in cleaning and janitorial services has catalyzed the development of related businesses. It has lead to strategic alliances between the service providers, the janitorial equipment makers and the chemical suppliers. Even though labor represents by far the largest portion of the cost, the cleaning service industry represents over 30 billion dollars in annual capital and operations expenditures. This sector represents the largest application of the concept of industrial franchising in the world with an estimated 100,000 outlets worldwide.

Next: Part 2

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