General Business Tips

Subcontracting Sweeping Services

Becoming Big Business For Some

Research shows that a number of successful sweeping contractors around the country have moved into the business of setting up others in the business. What this means, typically, is putting a contractor into business in an established route. Although these can be in the form of franchises, those we spoke to for this article organized theirs as straight percentage arrangements.

Typically such enterprises are started by experienced, competent contractors who turned to this system because they were tired of having employee problems. The solution: keep their routes, but hire drivers who buy their own trucks to do the work. Advocates claim many advantages for the system.

For one, we were told that these driver/owners maintain their sweepers better, and are more careful of the service that they provide. Usually, the trucks must all have the name of the central company on them. Each is actually operated, however, through a dba company formed by the driver/owner. This means that even though the driver/owner only has one truck, the company has the appearance of being much larger.

A plus is that the central operator usually maintains an extra sweeper for a backup unit. That can prove to be a big help to someone starting out who can afford only one sweeper. Another obvious advantage to the driver/owners is that their pay doesn't depend upon payment by clients. It's up to the central operators to collect for services rendered, and to deal with any bad accounts. This factor can also make a substantial difference to a startup.

We wondered what happened when an account was lost. The answer seemed to depend upon the reason for the loss. Most times, if the central operator lost an account to a competitor then the driver/owner lost it, too. And if the driver/owner did an unmistakably poor job for a client, then that account could be pulled.

Another way for a driver/owner to lose an account would be if, as a result of expansion, his territory was changed to allow in an additional contractee. For this situation, however, all those interviewed said that they would replace the loss with an account of equal value.

One aspect that all central operators required was control. No outside sweeping was allowed, even though such would pay the operator at a higher rate since any commission split - often 70%/30% - could be bypassed. Central operators mandated loyalty to their system. Most even required that no other drivers be used, except for scheduled days off.

Those we spoke with emphasized one point more than any other: the system was an improvement for all, and that's why it worked. That is, not only did the central operators find it better, but the driver/owners and the clients also benefitted: the former because they were doing what they did best, sweeping, and the customers because services were being provided by the actual owner of the equipment. As a result, the argument went, sweeping performed was of a higher caliber.

The future? From what we learned, our guess is that the trend is toward more of these types of arrangements, rather than fewer. Central contractors will sub out more of their daily routes. We also see the people who work in this type of system moving toward smaller, more inexpensive sweepers. Especially on the west coast, these will be units which are designed just for light litter, not the sand, gravel and other debris which accumulates over a period of time.

Central operators will themselves typically specialize in the heavy duty cleanup applications which require the large powerhouse sweepers. As part of the total service package, they will run these heavier machines in their sub-contractors' lots whenever they are needed to pick up all the heavy litter. The central operators will also handle the spring clean-up conditions for the subcontractors.

Although we foresee more sub-contracting arrangements, don't expect a big rush of them - by far the majority of the work will continue to be done much the same as it is today. There are also regulations that must be followed scrupulously in order to ensure the subs are actually classified as independent contractors, if the company is investigated, instead of being considered employees. Before you proceed with something of this type, be sure to consult with a competent employment attorney.

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