Update On Our Transition to Flat Rate: Numbers and Lessons Learned

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Introduction

Stephanie: Hello everyone, welcome or welcome back to the Filthy Rich Cleaners Podcast. I am your host, Stephanie from Serene Clean, with Miss Jenny right here on my desk for all of our visual watchers. I don’t — she’s purring. I don’t know if she can hear it. Can you hear that in the mic? My little Jenny has been all over the desk today.

Today’s episode, guys, is going to be from a listener question, and it is going to be the follow-up and results of our flat rate transition. As many of you know, or if this is your first time listening, Serene Clean, my business, was charging hourly for residential for seven years, and we made it well above $1 million in revenue doing that. However, we have always been flat rate for commercial, so it was just finally biting the bullet and the overwhelm and tackling the dang thing.

And Lorraine from Australia, our fabulous listener, is who wrote in asking: “Hey guys, good morning! I would love to know how Serene Clean is progressing with their flat rates. As far as I know, there’s only one podcast about the transition phase to date. I’m switching over too, and would love any extra tips or lessons, as it’s pretty in depth. Thanks, love from Australia, Lorraine.”

So thank you, Lorraine. You are fabulous. I am so appreciative of you listening, and this really is a great topic. As you all know, I have been touching on the fact that we’ve done the flat rate transition in some of my episodes in the past couple months, where I’ve been just going over the month as a whole. I have described some of the aspects, but I would like to do this particular conversation so I can put it all together in a neat little bow, and I do have some really good suggestions and lessons learned — some things I would have done differently if I could redo this whole thing, specifically in some of the ways that we communicated with clients.

However, all in all — spoiler alert — I am such a fan! I’m so happy that we did this, especially once we get into the numbers and some of the positives. I did ask my managers specifically their opinions on what has been the overall takeaways that they have had from doing this flat rate transition. What has been the good? What has been the bad? And yeah, I think that this is a good thing to go into now that we have done it. As you guys know, we switched over beginning in April and started the flat rate transition.

Start With New Clients First

So one thing I want to note is with our transition to flat rate, we tackled this in two parts. We tackled it in current clients and all new clients that are coming into the business, and far and above, bringing in new clients is so much easier with something different with pricing or structure because they do not know the difference.

So the first thing I would suggest is start with all new clients first, and that is what we did. We implemented flat rate for all of the new clients coming in first. It was so much easier because they’ve never experienced hourly with us. There was no trying to explain to them or change something that they’re used to. This is simply the only thing they’ve ever known with our business. It was so much easier.

The Numbers: What We Gained and Lost

So I will say the final kind of ledger of the transition of all of our current clients, so you guys know the financial impact. We transitioned to flat rate and we did that price increase all rolled into one. So it was hard to say necessarily at times if somebody canceled because of the price increase, the transition to flat rate, or a combination of both — like too much change all at once. So we, of course, documented as people were canceling the reason why they gave us, and sometimes they didn’t give us a reason even if we asked. But of course, if it was immediately after or within a month of this change, we can of course assume that it has to do with the price increase, even if they don’t tell us right away.

So as you guys know, we are tracking monthly recurring revenue. So how much did we gain? How much did we lose? So over the 85 accounts that we did this price increase and transition to flat rate, we gained $7,693 in recurring revenue a month just by doing the price increase. That’s insane! That is a huge jump in added revenue.

However, we did lose some as well from the price increase. So MRR lost to clients who canceled specifically over the price increase was $3,321 a month. So 12 accounts across May through July — so 97 accounts got a price increase, and 12 of them dropped because of this. So our net gain — the total of, you know, $7,693 minus $3,321 — we added $4,300, almost $4,400 a month just from doing this price increase for Serene Clean. That’s a huge impact, and I am going to just encourage you guys to do price increases because it is most certainly going to help you.

And those 12 accounts that canceled — now we were able to fill those spots with people who are at flat rate and who are at higher pricing. So when I think about it that way, all of those spots have now been filled with higher paying clients. So it really wasn’t a loss, if you will. It is a loss, of course, but I choose to look at it as that slot is now making more money for us. So just wanted to first go over the numbers and the impact.

So because we did a price increase with the flat rate transition, it’s really hard to discern if people would have just canceled because of the flat rate transition, right? I do have a couple examples for you there on, like, somebody canceling specifically because they did not like that, and some questions and backlash because of the flat rate transition. The reason I chose to do both of them together is because it’s like, let’s just do this change all at once instead of changing one thing one month and then another month — like trickle feeding them changes that have to do with pricing or anything like how we structure things. I’d rather just, this is what we’re changing; it’s done, it’s over with. This person is handled in that manner. So that is the reason we chose to do it that way. If you do not feel like a price increase is necessary and you just want to switch to flat rate, cool. And I think we did have to do that with some of our clients as well, where there was no real change to how much we’re bringing in from them. It’s just switching over to, like, this is your locked-in price kind of situation.

Month by Month: The Cancellation Wave

When it comes to the month by month, from April to August, we had two cancellations in April; neither of those were price related. May was like the first wave of cancellations — we had eight cancellations, several explicitly price coded. June we had four cancellations; two of them were explicitly price driven. And July was the tail end of the wave, so seven losses, four of them being price driven. And then August, we did not have any price increase cancellations logged. So the wave — the wave was over. This was a couple months, and for that many clients.

So I want to showcase to you what that percentage is. I have never done the math, actually. So like I said, we had 97 total clients that we did an increase or this change to. So if I divide 12 by 97, that is a 12% cancellation rate. So we lost 12% of our clients that we did this change to, and that equaled the $3,300 a month. So I’m gonna talk a little bit about my tips on, like, how to structure this. I am comfortable with that loss. If I was really, really, really sensitive to losing clients right now, I would have staggered it even more, which is going to be my biggest suggestion.

Roll It Out in Batches

So first off, I want to just summarize again: how did we do this? And the answer is going to be doing it in batches. As I mentioned earlier in this episode, we first split up this whole change into two sections. So the one section is new clients to us, and the other section is current clients. So the new clients were the easier ones; just roll it out and work through the problems as they came through to us. And the things that we were not expecting, we just worked through them.

And then with the current clients, we did these in batches. We did 10 to 20 existing clients per week, easy targets first — not the whole segment of clients. Not all 97 of them did we just do in one week, right? Because that would be incredibly overwhelming for us to handle administratively when they had questions; we wanted to answer them quickly. And if we had, you know, 12 cancellations in a week, that would be really stressful, honestly, and I would question if this was the right move. Where I do not question at all that this was the right move because it was staggered; we didn’t experience that, like, drop all at once, because that would make anybody freak out, right? Even if logically you know this is the right choice, it still makes you emotionally freak out. So that’s going to be my first tip: stagger this for your comfort level. And that could literally be, depending on the size of your business — that could be one or two a week.

So especially if you are doing a price increase, that’s how I would suggest doing price increases as well. If you are just doing this flat rate transition and you’re not doing a price increase, I think that you could do it in larger cohorts, because the likelihood of cancellation due to just the switch to flat rate is not going to be that much. However, you still might have questions that you need to answer, and so I would still argue that maybe you want to break this into chunks — like maybe two to four chunks — if you’re just switching everybody over to flat rate. And you certainly can call everybody. We did this all by email. I will say, I feel that was the most scalable because it would have been a lot to get everybody on the phone, and I don’t think it would be necessary for just the flat rate transition. Of course, if somebody had a question, that’s great; you can add that personal touch. But it was just easier for us to execute on email.

And I will go into specifics — I’m going to read you the email that we sent. I’m gonna read you some examples of responses that we got and how we answered those questions so that you guys can hear literally exactly how I phrased it. And as a reminder, when it came to the price increase side of things, we wanted recurring rates from clients who were at $50 an hour — we wanted them to be up to $55 an hour. And all new clients were quoted flat at $65 an hour for the initials and $60 for maintenance cleans, to basically reward them for signing up for maintenance cleans.

The Close Rate Spike

What really worked for us, as I had mentioned in the initial kind of responses to the flat rate, was — and this is what Molly Moran said — is that she thought that our recurring close rate, meaning people who went from just a one-time clean to recurring, that percentage was hurting because we had this range, and that was due to hourly. Like, it could be this, it could be this. We don’t know; we’ll figure it out when we get there, right? Obviously, we’re giving them an estimate based on our production rates, but it was a big price range. And so, switching over to the recurring flat rate prices immediately saw a spike in our close rate for recurring services, and that has continued to prevail.

Looking at that particular number since we switched over to the flat rate — so how I explain this is: we have our close rate of all leads, so that’s one-time, that is recurring, that is move-outs, right? That’s everybody. So we have that close rate. So all of our leads coming in, and then did they close for once, and how many of them became recurring, right? And so how many of them became recurring is really what I’ve been focusing on, because that’s where the money is and that’s where we’re adding the monthly recurring revenue.

Over 50% of all of the leads that close become recurring, and some months it’s as high as 75%. So that is not our total close rate; we are still hovering around a 30% close rate, and we are working on that. We want that to get higher. However, we did do the price increase, so I did expect that to be a bit of a harder sell with the price increase. But now, instead of, like, a quarter of the people turning to recurring, it’s a half to 75% of all of the leads that say yes do become recurring, and they become recurring faster, right? They’re saying yes a lot sooner to recurring because of that pricing certainty and just the language that we have been using to basically make that the clear choice.

This is what naturally happens, is, you know, this is how this works: you tell us what recurring schedule works best for you — weekly, bi-weekly, or every four weeks — we set up your initial clean. This is the price for that, and this is what billing is for the recurring. Which option works best for you? And we do have our flat rate email estimate available for purchase if you’re interested in trying it out in your business. It is $20. It is on my website, as well as all of my other documents and resources, bundles — all of that good stuff.

Side note: I just redid our website. Please go look at it; it is fabulous. I did it all with Claude — it’s amazing — including all of my individual work, my independent work from Serene Clean. So do look around Serene Clean’s website if you guys are trying to get ideas for your website, because I’m really, really proud of it. So, just side note. But if you’re interested in that flat rate email estimate template — that has been working so well for us on this conversion — it is available. It’ll be linked down below for you.

So that has worked really, really well, so I’ve been really pleased with that, and it wasn’t a fluke. The reason I’m bringing it up here is that it wasn’t just a one-time increase; that has sustained now for the past four months — the close rate has stayed up. So I’ve been very, very pleased with that. Obviously, that showcased last month in our huge MRR add of over $4,000. So it’s really, really helped when it comes to the close rate. So on all new clients, flat rate is just the bee’s knees. Like, I can’t even begin to express how wonderful it’s been, and just like, no friction, really.

The Pushback We Got

I want to talk about what some of the pushback we had was so that you can know what to expect. We did have a longtime client cancel specifically because he did not agree with the pricing structure. So we were not doing a price increase at him. He was already at $55 an hour. He was a lawyer, and we literally just switched it to the same price but flat rate. Like, you’re locked in; this is your price — and, like, really sold it as a benefit. Nothing was going to change for him financially. He just did not agree with flat rate. He wanted to pay for our time, and I wonder if that’s because, like, as a lawyer he charges by his hourly, and so that’s what he was comfortable with. He didn’t give any more details. Like, “I just disagree with this,” and the idea of flat rate just bothered him. So despite it not being a math problem — it’s not financially any different — he still canceled. So there are some people, like, they simply don’t like this; they don’t like the change. They want it to be hourly, just like some people want it flat rate. Like, it just is a very individual thing. So we did lose a client very specifically to this transition without any price increase, which is, like — it’s wild to me, honestly.

You know, a few other legacy clients cleared out. What I mean by that is, like, long-term clients that canceled because they did not like the new structure. They are used to paying for our time. They didn’t like the fact that if a cleaner was going to get done a little bit earlier, they would not get any money off, where they were used to that. Whereas if the cleaners got done 15 minutes early, now they would pay 15 minutes less, right? And so they didn’t like that. Even though on the flip side, if we went 15 minutes over, they weren’t going to pay for that either. Like, there was no difference there, but, like, in their mind they were like, this is not fair, because of what they were used to. So do keep that in mind. Obviously, commercial didn’t change — I’m just reading down my list. You know, we’re still doing commercial the same way that we had always done.

Tell Your Team Before Clients Ask

I will say one of the mistakes I did make was not telling my cleaners that we were switching. And my thought process was, why would I tell them this? It doesn’t change anything for them. They still have their expected time that they should get it done in, and, you know, nothing changes for them. They don’t deal with any of the, like, scheduling. They don’t deal with any of the anything. Like, it’s like, this is a four-hour job; it should take four hours. Like, that’s what you’re approved for. They’re getting paid for their actual time.

But a client had asked a cleaner about the flat rate stuff, and my cleaner was like a deer in the headlights. And this is a long-term staff member. She brought it to my attention that it didn’t feel great that she had no idea what the client was talking about. She actually listens to the podcast; that’s how she realized it. And so it was a good lesson. And, like, share with your team — especially, like, it doesn’t affect them per se, but it shows that you trust them, and it shows that you want them in the loop and that we are truly a team. And, like, a big structural change like this, there is no reason for them not to know. Like, in my mind, I’m like, it, like, doesn’t really matter, but they appreciate it. They really do. They may not say anything, but they like to know what’s going on. I can tell — like, the more I continue to share with the team on how the business is doing, the more they feel invested. Like, they just act like they’re responsible for it.

So I would encourage you, if you are going to do this and you’re like, really, we’re doing this, this is happening — don’t be afraid to tell your team. Just be like, hey, just a heads up in case any clients ask you; just keep directing them to the office. But I just wanted you to know, in case they ask you about it, this is what that’s about. It doesn’t change anything for you unless you are changing their pay structure — of course, then you should be telling them, right?

Exceptions and Negotiations

So when it came to some of our exceptions and adjustments, we had some clients who we negotiated with, right? So because we wanted to keep them — they were great clients, and it was simply a budget thing. So a few accounts negotiated down instead of leaving. My tip is, don’t be afraid to do a middle ground if you’re comfortable with that, so you don’t lose the client entirely. And I’ll give you an example of that — I’ll read exactly an example of that. And also, additionally, with some of our elderly clients, we did give them a manual discount off of the calculated flat rate to keep that relationship, and because, frankly, like, that’s what we felt comfortable with.

And so again, at the end of the day, I’m not telling you to do anything you don’t want to do. Or you can come back and say, “What about this? What about this? I got this old client.” It’s like, cool — then give them a discount, guys. You don’t have to do everything in this militant way of, it must be this way. This is your business. If you want to give somebody a discount, give them a discount. It’s totally fine. We still have some clients that we have made those decisions, and we’re comfortable and happy, and we don’t have any resentment going to those clients’ homes, because we made that choice and it makes us feel good. So don’t be afraid to do that, but don’t be making that exception for every other client, right? Because then that doesn’t make any sense.

The Exact Price Increase Email We Sent

So let me hop into the actual email and a few examples for you guys before I talk about just my management team’s takeaways from this as well. So the actual email that we sent out — I’m just gonna read it. It says: “Hi client” — obviously, the client’s name. “You’ve been with us for over five years now, so I wanted this note to come directly from me. Starting May 19th, 2026, your cleaning will move to a flat rate of $140 per cleaning. I want to be straight with you about why: Serene Clean employs our cleaning technicians as W-2 employees with competitive wages and benefits. Most cleaning companies use subcontractors; we don’t, and we never will. That investment is what allows us to put every tech through extensive training and a hands-on quality assurance process. So no matter who walks through your door, you get the same thorough, detailed clean your home has come to expect. Keeping that standard intact means adjusting what we charge to match what it genuinely costs to run this way.”

“What’s changing? Your rate. What’s not changing? Your cleaning day, the quality you’re used to, our 24-hour satisfaction guarantee, and the way we show up for your home. A flat rate also takes some math out of it — same number every visit, which is predictable and easy to plan around. If it’s easier, we can also put a card or bank account on file and process payment automatically after each clean. Just reply auto-pay, and we’ll take care of the setup. Thank you for letting us into your home all these years; it’s meant more to our team than you probably realize, and we’re committed to continuing to earn it. Warmly, Stephanie.” So that was our price increase email.

A Dream Client’s Response — and How We Met in the Middle

And I’m going to give you a response from one of our weekly clients, which was a very thoughtful, great response, and just, like, the interaction of how we handled it, because this was one we met in the middle on. Okay: “Hi Stephanie, thank you for reaching out. I have discussed this with my husband. We have a few questions we’d like to ask. Where did you get the house cleaning at $140? If I look at the last seven house cleanings, the cost has been between $111 and $122.50. There were two cleanings in February that were hired due to having house guests and a request for additional cleaning. Otherwise, in general, I feel our house cleaning bill comes in around $120. We would be happy to pay that as our flat fee since that is around the average of our regular cleaning services. Consider this: an additional $20 being paid out four times per month is asking for an additional $80 a month, sometimes $100 if it’s a five-cleaning month. That’s a big ask. $80 is nearly two-thirds of a house cleaning fee at the current rate and system.”

“Number two, regarding extra cleaning. When I know I have house guests staying overnight, which happens every few months, not often, I like to request the additional time for our guest bedroom, such as in February. Generally, the guest bedroom is not part of our regular cleaning. If I request that, how will you bill that type of request? Or can I no longer request some additional service time?” Great questions. “Number three, while we appreciate the flat rate and your recognition that any technician should come through and be able to clean our home, we have come to develop a trust in our current technician, Amber. I appreciate getting the weekly emails stating the time and that Amber is our tech. With this new flat rate, do you anticipate having different techs come into our home, or will Amber remain our technician while she’s employed at Serene Clean, of course? Again, thank you for your communication and consideration of these points.”

Such a great communicator! This is a dream client, guys. She’s literally been with us for five years, a weekly client. Just, I mean, chef’s kiss. Beautiful questions. And it brought up several fair points. Like, this is one of my learning lessons of, you can’t necessarily know how people are going to respond, because if I’d seen this ahead of time and thought this through, I would have changed that initial email, especially specifically on, like, add-ons and things like that. I mean, it’s tough, right? Because I’m like, well, I don’t want people taking advantage of this. You’ll see how we responded.

Okay: “Good morning, client. Thank you so much for taking the time to share your thoughts with me. I truly appreciate the care you put into your questions, and I’m glad to walk through each one. First, the price increase is being rolled out across the board to all of our recurring clients. With the rising cost of supplies and wages, we needed to adjust our pricing to continue providing the quality of service you’ve come to expect. Your cleanings generally run about 2.5 hours and up to 2.75 hours, which is the range the new flat rate is built around. That said, you’ve been a wonderful and loyal client, and I’d like to meet you in the middle. I’m happy to offer you a flat rate of $130 per clean rather than $140. It reflects both the changes we’re navigating and the value we place on our longstanding relationship with you.” So, meeting in the middle to bring it down to a $40 per month average increase for her.

“One thing I want to highlight: the new rate is designed to absorb the small additions that used to come with extra charges, like adding your guest bedroom when visitors are staying. Going forward, those kinds of requests are included under the flat rate without changing your bill.” So that is a huge benefit to them. There’s no question about the bill being different, and that helps make this price increase more justified in the client’s mind. “Amber” — that’s not what I said; I’m just telling you guys the caveat — “Amber will absolutely remain your primary tech. We know how much trust you’ve built with her, and that consistency is something we protect. You’ll continue to see her name in your weekly confirmation emails, and that won’t change as long as she’s with Serene Clean. One other option I wanted to mention, just as a suggestion: for weekly clients, we offer monthly billing, where you’d receive a single invoice at the end of the month rather than one per clean. Some of our clients prefer it for simplicity. No need to decide anything — just wanted to put it on your radar in case it sounds easier. Thank you again for your questions and for being a loyal client.”

So, what I would have done — if they have, like, a regular cleaner that they’re very married to, which, for example, this client is, and we knew that — I would have given that reassurance in the initial email. Like, you know, we know you love Amber; she will remain your regular cleaner, but, you know, all of our cleaners are trained in this way, blah blah blah. So, given that little caveat so she didn’t have to ask that. But, you know, just minor things. Overall, I thought it was, like, a good way to do the price change and information.

Finally, her response was: “Stephanie, thank you for your clear communication. I appreciate the direct feedback.” Very nice. “Yes, $130 is a great compromise. I know we are all feeling the crunch of inflation right now. Hello, gas prices! Since I don’t have to approve each weekly cleaning price, I’m happy to put a bank account on file to save you the credit card fees too. I’m good with weekly or monthly payments, whatever works best for you.” Fantastic! And then we got a great new video review from her too. Oh my gosh, just dream client. Client, I know you’re not watching this — if you watch this, I love you. You’re amazing. So, just a fantastic back and forth.

So this is a perfect example of, even if you are not doing a price increase but you’re rolling out this flat rate to all of your clients — like, batching this, because this takes some time, right? Of course we’re using AI to answer this and go back and forth and then adjusting it from there. But it does take time, and I want you guys to have, administratively, the space to deal with the influx of questions that you are most likely going to get, right? Not every client’s gonna have a question, but even if a fraction of them are like, “Well, can you explain this a little bit more?” Obviously, we did tweak the email going forward to accommodate — like, we learned. So what I mean is, if we got questions to our initial email, then we would tweak the next batch to reflect the answer a bit more, right? Or whatever that would look like. So that’s another reason I like doing it in batches. Even if you did a couple and see, how do people respond? If they all had, like, a similar question, well, clearly you need to tweak that email, right? So that’s the nice thing of doing it in batches. And again, just — if I got an email like this from, like, 10 clients all at once, like, I would feel so overwhelmed, and like this was a terrible choice. Like, clearly none of them agree with this — even though, again, it wasn’t a bad choice. This is why I would highly recommend batching, even if you’re not doing a price increase. So that was a perfect example of how that went down.

My Management Team’s Takeaways

I asked my management team, new clients versus old clients: what is your general overall feedback on switching to the flat rate? So Katie, who does customer relations as well as all of the sales-related things, said that trying to not attach hours to it, and being okay with doing that when it’s needed, like a client specifically asking. So what that means is, clients really oftentimes are like, “How long is this going to take? How many hours is that going to be?” And it’s not necessarily because they’re trying to figure out our hourly rate. They maybe want to know how many hours we’re gonna be in the house, right? Which makes a lot of sense. But sometimes they are trying to figure out our hourly rate, and so that has been a difficult thing to navigate. And just reiterating, like, we charge by the job; we don’t charge by the hour. However, we approximate that we will be in the house for, you know, two to four hours — or something like that is kind of how we’ve been doing it.

Priority Cleans Instead of Limited Hour Cleans

And I’m going to get into, like, the priority cleans as well in this conversation, because that has been a bit more challenging to figure out. That was one of my biggest concerns, because limited-hour cleans are something that we commonly sell, which I’ve talked about before. And so switching the verbiage — it is now called a priority clean, not a limited hour clean. So nothing related to time at all. So we had to change the guidelines for that, because we had a separate guidelines and process for our limited hour cleans. So now it is a priority clean.

And explaining, like, what does that look like has been a bit more challenging, because it’s truly — they are buying time, but really they’re buying spaces. Like, it’s tough. It’s like, they are buying time in our mind. We are booking them for four hours because we’re shooting for, like — let’s say, you know, we’re at the 60 bucks an hour for maintenance cleans, right? So their recurring budget is, what is that, 240 bucks, right? So we’re going to set it for four hours, even though maybe the actual maintenance clean for the whole home would be six hours. And so then we have them list out, okay, what space in what order do you want us to work through the home? We will get through as much as possible. On average, this is what we are looking to get through. Obviously, if it’s a maintenance clean and we’ve done the initial, we can get a lot better at, like, exactly how much we’re going to get through in that particular home, in case it’s different. But we give them a broad idea — you know, typically we would expect to get through these spaces; however, that’s highly dependent on your home, et cetera. So it’s still a lot of, like, estimating and a bit of vague language.

So it’s still tough, you know, and the reason it’s tough is because even if we can get a good sense of what most kitchens take, their kitchen might be different, right? And so that’s tough, because if they have a kitchen that’s, like, twice the size of a normal kitchen, then it’s going to take longer. And so it’s just a bit difficult. And so using that initial clean as an information-gathering session as well, of, like, hey, I know we said this is for your flat rate cleans, for your priority cleans; however, seeing the space, we actually are going to adjust it. We can probably get through this many rooms, or whatever, right? So just knowing that it is still a bit tentative with those. It’s still not perfect feeling, and it’s a work in progress.

Katie also said deciding when to charge more or less due to time needed or not needed. New clients are easier because it is all they know. Old clients are tougher because they think in time, not per job — which is just, like, the biggest challenge that we faced with this transition with the older clients. And what she means by deciding when to charge more or less due to time needed or not needed — that has definitely been a mind shift — is, you know, because we’re charging for the job, sometimes we’re making a lot of money hourly, especially on initial cleans. And that has been really crazy to experience, of making $80 to $85 an hour at an initial clean. And that’s, like — nothing changes. Like, we’re not discounting anything. Like, it feels very strange, and it feels almost icky, but they are paying for the job now. So that’s just been a strange adjustment for us. I’m curious if anybody else has ever had this transition and they have felt, like, guilty or weird about it. And so if it has been, like, outrageous — like, where we feel gross, and we’re like, I don’t like this; it took way less time; we were making so much — we will sometimes make that call still, just to make ourselves feel okay. But for the most part, we’ve just been sticking to the guns of, like, yep, we made $70 an hour at that job, because they are paying for the job. They were happy with it. They booked recurring. Cool. So that has been an interesting thing to kind of grapple with internally.

And then I asked April. So April said it was much easier billing-wise for old and new clients to do flat rates — so much faster for her. Old clients can count on a consistent price each cleaning; it’s easier to budget. New clients too — it’s easier for them to budget. The challenges, I would say, is the initial setup. There’s new fields in ZenMaid. We are adding a lot more notes about pricing, tracking with increases, and notes in ClickUp, doing our production rate auditing in ClickUp — which should have been happening anyway, but now it’s, like, even more important because we’re doing flat rate pricing. So billing definitely got easier on all fronts. Like, it is so much easier to bill because we’re not having to do actual hours. It’s like, this is the price — which is fantastic. The kind of, like, cost administratively is a lot of the backend setup for flat rate. But now that we’ve got it moving smoothly, it feels good, and it doesn’t feel so overwhelming. So again, it all is in kind of the setup and the actual transition itself. But once you’re maintaining and you get through that phase, it will get a lot easier. I promise you that. It certainly has for us. It’s not going to be forever. And then Crystal really didn’t have anything to add. She does all of the HR, and because it didn’t touch the cleaners, really, that has been the biggest thing.

Production Rate Auditing Is Crucial

What we have implemented in ClickUp is very specific, like, production rate auditing. And this has really opened my eyes, and why I have pushed at ZenMaid to introduce production rate auditing into the software. It was always important — I always knew it was important — but now, as a flat rate cleaning company, oh my gosh, is it so important. We are looking at all first-time cleans that happen every week. We’re making sure that we are making what we need to make — meaning, how fast did we clean there? How much money did we make there? Did we go over? Why did we go over? Is there a reason for it? And then maintenance cleans too. After three maintenance cleans at a new client, we are checking on average what we are hitting there, and do we need to make an adjustment?

And this is where the other email I had pulled up earlier — I want to read to you how we’re explaining that. So say we do three maintenance cleans at a new client, and the cleaners were aiming for four hours; they cannot get it done in less than four and a half hours — labor hours, right? This is how we are handling that: “Hi client, we wanted to reach out regarding your recurring maintenance cleanings. We have found that our cleaning techs are not able to get through your entire home within the time scheduled for your flat rate of $150. Going forward, your cleaning techs will continue working through as much as possible, starting with the kitchens, bathrooms, and common areas, then moving on to bedrooms and other spaces. If you would prefer your rooms cleaned in a different order, please send us a numbered priority list, and we will make sure that is noted for your techs. Alternatively, we can increase your flat rate to $225 per cleaning to allow enough time to get through your entire home. Please note that if we move forward with the increased rate, we may need to look at alternative times, dates, or scheduling to accommodate the additional time needed. Please let us know how you’d like to proceed, and don’t hesitate to reach out with any questions.”

So we have had to do this multiple times, and it’s just kind of that communication of, like, this is the initial, and, like, being okay with that. Like, we were wrong; we’re still adjusting and learning and figuring out why, right? Because at first I was like, oh my gosh, like, are we estimating wrong? But we’re figuring out exactly which houses are we going over and why, and that will hopefully adjust — not hopefully, it is going to cause us to make adjustments to our intake process. And so far, it’s only been a couple clients — I think it’s been two or three so far that we’ve booked in the past couple months — that we have had to send this email and make those adjustments. But we’re looking at it every single week. As clients are having enough maintenance cleans, we’re checking in on this.

And so this is why production rate auditing is absolutely crucial, to make sure: are you actually hitting your numbers on all of your clients, right? Because a lot of times we set the price and we forget it, right? We’re like, cool, and we’re never checking into this. And it’s like, were we able to hit it once but never again? Was it that that cleaner was really fast? Like, all of these things really matter. And this is, of course, if you pay hourly. Like, if you’re paying a percentage, it really doesn’t matter. And this is where, you know, pay for performance — like, the benefits of that can really showcase for you, because it stays the same. However, I like hourly, because if they get faster, like, we’re making a higher percentage, right? Where pay for percentage, or pay for performance — good lord, say that 10 times fast — you can’t make any more money on it, right? You can’t make a higher percentage, and in fact, you’re probably doing bonuses and upping the cleaners’ percentage, so you’re making less, actually, on those jobs. So that is one of the reasons that I do not go that route. Also, we’re hourly; we’re going to pay hourly. Like, I don’t foresee that changing anytime soon. I’m happy with paying hourly.

But I will say, from a scheduling perspective, for you to be accurate on how much time to give the cleaners, you still need to know how long these jobs are gonna take. So if you estimated three hours — you’re paying a percentage, so it doesn’t change — and they take four hours? Well, guess what, now your schedule’s off by an hour, right? So jobs for the rest of the day could be off, or the day is going longer, and all of a sudden the cleaners are working nine-hour days because, you know, you didn’t schedule enough time at a client’s house. So it is still important, regardless of how you pay, that you are doing these audits and making sure that your timing is right.

Our per-room timing is something that I really want to do a lot more in-depth auditing on, because I feel like we have pretty good estimates, but I question it still sometimes. Like, is it fully accurate? Like, I don’t think it’s, like, way off, but I could see maybe having a bit more nuance to it. Of, like, cool, this is a small, medium, or large of each type of room. Because some master bathrooms, like, that could be an hour, that could be an hour and a half, or two hours. Like, some of these bathrooms are freaking crazy — it’s like a whole apartment in there, right? And because we don’t do walkthroughs, like, that means — like, they said they had three bathrooms; those three bathrooms could be drastically different. So it’s just tough. And really, on the first time, if they’re booked for maintenance cleans, I don’t really care if we lose out a little bit — like, we go a little bit under what we were hoping — because the money is in the recurring. But that’s where I’m like, okay, cool, if they have, like, a giant master bathroom, that’s where I would want to adjust that maintenance clean price to reflect it, because it’s flat rate. Where if it was hourly, we’re simply paying for our time, right?

Wrap-Up: My Tips for Making the Switch

So, when it comes to, like, my wrap-up and summary of what I would suggest for you, Lorraine, and anybody else who is listening — I hope, you know, I could be just making this for Lorraine; she’s the only one who listens, but this is for you, hun. So number one: get your production rate data solid before you flat rate anything, right? Because otherwise, you’re just guessing. You are completely guessing, at the very least, for all of your current clients. Like, how long does it typically take? What is the hourly that you’re shooting for? And then transition them to that as a flat rate. And then for all new clients, like, of course you need to do it. With hourly, like, you can’t lose, right? If you’re charging hourly, you’re never going to lose; you’re just never going to win in the way that we’re winning now. But you do have more to lose as flat rate. So this is where it becomes way more important, I would argue.

Number two: segment new versus existing clients. Don’t pitch them the same way. Just break them apart and see them as two separate entities and two separate projects. Number three: batch the rollout, as I mentioned multiple times. Number four: expect a dip in month one or two on existing clients, right? Because they may not cancel right away. They may cancel after that first clean when you have transitioned, especially if you’ve done the increase, right? I do not anticipate — it’d be strange to me if you got a lot of cancellations just from switching to flat rate, especially if you explain it well. But it could happen, as you’ve seen; it happened to us for a few. So don’t be alarmed. Don’t freak out if you do have a little bit of a dip, especially if you’re doing the price increase. When you do a price increase, some people are going to cancel; that is expected. You are going to make more money on less clients. That is the wonderful thing.

Number five: track your actual audited hourly rate, not just the quoted rate. That’s where the real upside shows up, right? So, how long did this job take? How long did we expect it to take? So we thought it was gonna be 10 labor hours; it took eight. That meant we made this on that job. Awesome! Fantastic! That’s what we’re really looking at. Number six: brief your team before clients start asking questions. As always, just have them directed back to the office, but it makes your team feel good for them to be in the know.

Number seven: offer a middle ground counter before you let a longtime client go — unless you’re like, you know what, I’m tired of dealing with this client. We had a couple of those as well, where we’re like, this is okay; this is the time to part ways. But don’t be afraid to counteroffer and meet somewhere in the middle. Don’t be afraid to discount if you feel so inclined with a particular client. It’s your business — you can make the pricing rules.

And then finally, give it 60 to 90 days. Do not freak out if you have an influx of cancellations. It doesn’t mean that you are making the wrong choice. It also doesn’t mean that, you know, this is going to be a bad thing for your business. This is why we’re batching it, right? Give it time. Stagger it. Make adjustments as you’re getting responses. You don’t have to just stick to the same message. If you’re getting this question over and over again, like, clearly you need to adjust the communication that you’re doing this with. You certainly can call. You can email. I wouldn’t text. I mean, you know how I feel — we text a lot in the business from the business line, but I personally think this is email-worthy or call-worthy. I would not text this; it doesn’t feel super professional to me, unless that’s the only way you communicate with your clients. Just give it some time. Don’t panic. Be methodical about it, and it should go well.

I cannot tell you — I think it is so worth it. This is one of the best changes that we’ve made in Serene Clean in, like, a very long time. Obviously, we’re seeing the fruits of it in so many ways. The complexity, for sure, is in dealing with the different situations as they come up, and doing the auditing, and just being really, really diligent about that. And being, like, a psycho of looking at all of the jobs every day — that’s not what we’re doing, of course. I mean, kind of, I guess we are, of, like, why did this go over? But just making sure that we’re double-checking the production rates, because this is where we could really — that’s the risk, right — is us being hurt on how long the job takes. But as long as you have your estimating down and you are making adjustments — like, if you’re underestimating and you’re consistently not making what you want to make internally hourly, well, then you need to change something. You need to start estimating longer. You need to start giving out higher bids, because clearly, you know, you don’t clean as fast as you think you do. You need to go off of realistic numbers.

Which, as I’ve mentioned so many times before, Serene Clean’s initial clean rate is 150 square feet per hour — that’s how fast we clean. On maintenance, it can be anywhere from, like, 650 to 750 square feet per hour. And on move-out cleans or vacant home cleans — whatever you want to call them — where it’s a deep clean, we’re doing all the interiors of the appliances, the windows, all of that good stuff, the cabinets, closets — that is going to be 100 square feet per hour. So that is our production rates, based on the tasks that we complete at Serene Clean. If you want my cleaning checklists, they are also available on my website, so that you guys can see exactly what tasks we perform.

Final Thoughts

So I hope this was helpful, Lorraine, and to everybody else listening. It really has been a wonderful change. I’m so proud of my team for making this transition, because it was something we were all afraid of, and sometimes you just have to take the leap. And I’m really glad that we did this. So all in all, it was a very positive thing.

If you have made it the whole way, leave me a little kitty down below. Jenny left me, but she was here in the beginning. I’d love to see the kitty emojis. Any questions or feedback that you guys have on flat rate pricing — please hit that like and subscribe. I would love if we would get some more subscribers to our wonderful community here. If you are on Spotify or Apple Podcasts, leave us a review; it really helps us get to more cleaners who would benefit from this information.

If you’re not part of the ZenMaid Mastermind on Facebook, please join. The past two Fridays, I have posted several, like, tutorial how-to videos of different things that I’m doing in Serene Clean, so that you guys can actually see, like, me screen sharing — I don’t know when this is going live. I’m trying to do that more and just sharing little tidbits of different processes, and that’s gonna be exclusively in the ZenMaid Mastermind, nowhere else. So if you like that type of thing, join that.

Let’s see, what else — and of course, the newsletter. If you want to ask me a question like Lorraine — that is how she asked the question — she responded back to one of our newsletters, I believe, or left a comment here on YouTube. But the newsletter is the surefire way; just respond back to the newsletter. Completely free to subscribe to that — you do not need to be a ZenMaid customer. We would love to have you trial ZenMaid if you haven’t already. If you have trialed it previously and you’re like, not for me — there have been so many wonderful changes and improvements. We would love to see you give it a go. The customer success team has been absolutely top notch. Shout out to Elizabeth, Carly, and Kayla — you girls are amazing at what you do. You’re so helpful. If any listeners have talked to them at all, please leave some love in the comments, because they are literal angels. They’re wonderful. They’re so helpful, and they want to see you succeed. So they’re incredible. I just wanted to give that little shout out, because they are the sweetest human beings ever.

So this is the longest outro ever. Oh my goodness, guys! I just got so much to say. Anyways, I hope you’re having a great week. I will see you in the next episode of Filthy Rich Cleaners. Bye bye.