Chapter 4: Client Retention

Hang On to Your Clients

Ready to look at more metrics that matter? In our fourth chapter of this series, we’re going to touch on a very, very important analytic. How many clients you’re keeping (retention rate), and alternately, how many clients you’re losing (attrition rate). Being so close to the operation, you may feel that you already have a handle on client retention, and fair enough, you likely have a gut feeling that isn’t too far from reality, but, do you actually calculate your client retention rates? On a regular basis? Do you set goals around improving? On top of all that — do you know what a healthy client retention rate even is for a cleaning company? These are all metrics that you should be aware of and clearly tracking, in order to grow your business and move forward. And we’re here to help!

Did you miss chapters 1 through 3? Be sure to catch up here, here and here!

First of all, why do we need to look at client retention?

Fact: Keeping customers is faster and easier than trying to get new ones — and also costs five to 25 times less

Think about the entire process of making cold calls or bidding on requests for proposals in order to get new business. This involves getting to know new potential clients, and following all the rigorous steps of trying to win new contracts. If you’re constantly losing clients and then having to go through the process of getting new ones in order to meet your sales goals, you’re spending a lot more time and money than if you simply retained a higher percentage of your existing clients.

Clients you’ve already been working with know you, know your cleaners, and you already have contracts in place and a relationship to build on. It’s much easier to renew a contract and simply negotiate new terms than go through the entire sales process from step one. (Not to mention keeping existing contracts means less training for the cleaners.)

Calculating Client Retention (CRR)

The formula for calculating client retention is:

Retention rate = ((CE-CN)/CS))100. 

CE = number of customers at end-of-period

CN = number of new customers acquired during period

CS = number of customers at start-of-period

Don’t worry, once you fill in the formula and get familiar with it, it’s not as hard as it looks. (We don’t love math either.) Let’s use an example below… 

Say you start the period (first quarter) we’re measuring with 100 clients. Over the first quarter, you lose 5 of those clients, but gain 15 new clients. At the end of the first quarter, you have 110 clients total.

So, 110-15 = 95. Then 95/100 = 0.95, and 0.95 x 100 = 95. Which means 95%. Your retention rate for first quarter was 95%.

Client Attrition Rate (AKA: Customer Churn Rate)

The opposite of the retention rate is the attrition rate — also called a customer churn rate. Client attrition happens when you lose a contract, and the relationship ends. If your client retention rate is 95%, as per the example above, then your attrition rate must be 5%. 

It only makes sense that to grow your business and to be more profitable, you want to shrink your attrition rate as much as possible. The fact of the matter is keeping existing clients is valuable to your company, and you’ll see it on your bottom line.

Stat: In the United States, an estimated $83 billion is lost each year due to poor customer experiences and customer attrition


Yes, we’re talking about benchmarking again. Now that you’ve calculated your retention and attrition rates for 2019 (or whatever period you’d like to benchmark) you can really start measuring your progress. While of course, 100% is the ideal retention rate, it may not be realistic for your industry. Start by looking at what your benchmarked percentage is, and getting better from there. Measuring quarterly is a great way to stay on top of things. If you’re not meeting your goals, make sure you reflect on why that might be.

Stat: ROI: A 5% increase in customer retention can increase company revenue by 25-95%

Ideas to Help Keep Clients 

So, now that we know keeping existing clients means a better ROI for your janitorial company, how do we go about doing that? Here are a few ideas to start you off:

  1. Start with onboarding. Teach your new clients about how this relationship is going to work, and set realistic expectations.
  2. Customer feedback and surveys. The learning process is never-ending.
  3. Open lines of communication. This can mean one-on-one meetings, scheduled check-ins, or even newsletters.
  4. Client loyalty incentives. Treat your long-time clients to some well-deserved perks.
  5. Ongoing client education. Making changes? Keep everyone in the loop to avoid confusion or frustration.
  6. Empower your client with the right tools.

Stat: According to Mixpanel’s 2017 Product Benchmarks report, for most industries, the average customer retention rate was below 20%.

With only one chapter to go before we wrap up this series on the valuable metrics that can make the most difference in your janitorial company, be sure to read through our first 3 chapters

Swept is dedicated to highlighting stories that touch everyone in the janitorial industry. Having started as a commercial cleaning company ourselves, our hearts go well beyond the janitorial software we offer. Learn more about Swept’s cleaning company software here. And to keep up on all the trends in the janitorial services industry, subscribe to our blog!

Take a look at our post pandemic Hiring,Training & Retaining Guide.

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