3 WAYS TO PAY HOUSEKEEPERS
You have three options on how you can pay housekeepers if you want to pay them in trident layers you technically have four. In this section, I’m going to show you the three different types of compensationstructures that are typical for a role like a housekeeper and what the pros and cons are for thosecompensation structures. You will get a different work style and you're providing a different type of workplacebased on how you pay people. This is really important to run your Airbnb short-term rental business. I have over 100 properties and at scale I’ve heard a lot of housekeepers and we've had to pay some in someinteresting ways at different phases of our growth. This section is going to help you grow your Airbnbbusiness because the housekeepers are the core of your whole business. They are the center of your business. I have over 14 years of experience hiring, training, firing,and paying people between management small business ownership experience. By the end of this section, I’m pretty sure that you're going to find out that the one core method of how you should pay your housekeepers is different than the one you're doing.Hopefully, I’ll be showing you that third option that you haven't even considered yet and it's highly usable in some situations.
I’m going to tell you why the three different types of compensation structures matter and how they're usable. This can be a lot to understand if you’re not experienced with Human Resources. You can pay someonesalary, you can pay someone hourly, or you can pay someone piecemeal and piecemeal is either like commission or buy the job. You're measuring in units instead of hours or like in salary pay now the rarest one that you're going to use is salary.
Paying cleaners by the job
Let me start with the one that you're probably used to which is paying people by the job. The reason whymost Airbnb hosts start by paying people by the job is because that's how contracting typically works in the housekeeping space. You have an apartment you want to have it cleaned you call a cleaning service, and they give you a quote for the job. This is what is most normal, but this is business to consumer one-off transactional type of work. A lot of Airbnb hosts start with that and there's nothing wrong with paying cleaners by the job. I do believe that even if you have your own internal team of housekeepers or you're doingsomething else you should always keep a couple of these companies on standby because you never know if you're going to need a housekeeper last minute. Quoting you a price for the job might still be cheaper than not getting your place cleaned. Paying people by the job in housekeeping is the most expensive. I think the place for buy the job is to have vendors on standby that you know what they’re going rates are going to be. If you call them last minute and you know that you can have a controlled cost to get the place clean. At that price you know that no matter what, the place will be cleaned. After that after that, controlled cost part it's all downhill from there. I guess you could say it's all uphill because there's no actual no there's no extra upside to paying someone by the job.
When you pay someone by the job, you're going to pay them whether or not the job is good. So there's no incentive for them to stay longer to do a better job. If you ask them to do extra things for you that are not typical to a typical housekeeping they will probably try to charge you more money. So now you're going topay more than a normal housekeeping because you're asking them to do more stuff. If you have seen my system, you know that the housekeepers are the bread and butter of the business. They do so much more than just cleaning. You're going to have a problem at scale paying all this extra money. Even some of the biggest companies in the world like saunder, they use they use contractors in almost an entirety. This is one of my biggest frustrations with them but it also is the one thing that I think is my competitive advantage. As I go after saunder and try to put someone like them out of business, I’m going to do a better job competing oncost now.
Paying cleaners salary
The second method of paying your cleaners is a super rare one it's one that you like might use transitionally here or there. This is especially helpful for those of you who are small and you want to get your firsthousekeeper but you don't know if you can give them enough work. I did a hybrid of this so there's kind of two ways to play this game but like follow along on this so let's say you've got a few houses and you're paying someone or company like a hundred and fifty dollars per house to clean those houses. If you paidsomeone by the hour you can get it done cheaper, but the problem is paying someone by the hour you probably need to give them at least 20 hours of work a week 30 hours of work a week for them to feel good.Let's say you have four or five house cleanings a week right at $150 each. That's $750 a week, so if you paysomeone's salary $400 - $450 a week you can save $300 on your housekeeping.
You don't always know that there's going to be exactly five housekeepings there might be six one week there might be three one weeks. You decide you're going to go with this $400 a week salary and pay someone, so some days they won't come into work because there's nothing to clean, some days they'll be working seven or eight hours to get the cleaning done. For example, now this is under the assumption that one person could clean entire houses which is is actually a little bit of a fallacy, but I think you get my point. You could actually hire two separate housekeepers. That might be $250 a week salary like an agreed-upon part-time salary. Let them know that Sundays are always a work day and Fridays are probably going to be a work day and Thursdays are probably going to be a work day and that they're most likely going to be working about 20 hours a week at most. You know you don't know if you always have business for them so you're just going to do that $250 a week guarantee.
It's going to be more expensive than paying them hourly but they get this advantage of a safety net so where this salary kind of comes into play is you're trying to give stability to someone in order to get them to work for you for cheaper. The pay by the cleaning is like $100, $150, $200 cleaning to this company and they don'tcare if you only pay them for one job and never talk to them again. They got their rate from you but as youstart to develop longer relationships where you're starting to try to get a discount from people you you want to find a new structure and salary is that good I’m small I cannot guarantee you work but I can guarantee you money and if I happen to have a super busy week please hang in there your salary still counts and you'retrying to average over the course of a month you're trying to get instead of paying $35 to $50 an hour for your housekeeper because you paid by the job, you might be able to get them for $20 to $25 dollars per hour. If you could get them for less than $20 an hour because you set up your salary correctly you're doing really good by paying less than $20 an hour for a salaried housekeeper.
This is the beginning of you starting to operate at scale, isn't this exciting?! I want you to do the math on this one. If you are a small Airbnb operator, take a look at how much you're paying for your housekeeping. I want you to try to discern how many hours are actually spent cleaning your place and then divide that by thenumber of hours and you might have. Maybe a $2,000 per month housekeeping bill and you divide that That’s only working say 40 hours a week on your $2,000 a month and you're paying $50 an hour. Then what I want you to try to do is try to decide how many hours a week that actually looks like. Consider if you want to hire one or hire two part-time housekeepers and offer them a salary at say 50 to 60% of whatever your currenthousekeeping costs are. That's a good step forward and now you're starting to get competitive on price.
Paying cleaners hourly
The third method of paying your cleaners is hourly. This is the method that I preach all of the time. There's a lot that you can do by paying your housekeepers hourly but there's a lot of responsibility on you as well.Paying hourly for your housekeepers is the top of the food chain when it comes to running your business.You're getting a highly cost effective cleaning if you do it right but there's a lot of management that goes into play. There's a good amount of give and take. We pay $12 an hour for our housekeepers as opposed to what everybody else pays. Our one bedroom cleaning costs are about $20 to $23 dollars per turnover. okay Sinceone bedrooms or studios don't take a lot of time to clean, you do have to solve the problem of linens and sheets and cleaning those in bulk. At scale, that can be an issue but that's not for this section. We're talking about cleaning the apartment you can always just remove the sheets and clean them off site and bring some other back.
There's a company out of Milwaukee now called wash bnb. It's a startup. They'll do the laundry for you but they're just in Milwaukee right now. Even hotels do their laundry off-site because it slows housekeepers downand they pay their housekeepers by the hour. It's a system here. The cool thing about paying someone by the hour is if you want them to do extra things, they will still get paid for their extra time. I have a five-step cleaning system I teach my students and the first two steps have nothing to do with cleaning. We're doing what I would call a wellness check on the property so they're checking to make sure the tv works a lot of people forget to turn on the tv and if someone breaks the tv you cannot get that money back unless you check the tv before the next guest checks in right so your house keepers should be turning on the tv and messing with all the electrical to make sure nobody broke anything. If light bulbs have burned out stuff like that who's checking these things? If you hired a company that you pay by the job to do the housekeeping,they're going to clean the whole place and you might convince them to do a couple extras, but they're not going to turn on every single light switch in the house to make sure none of the bulbs are burned out.
You're trying to give a five-star experience you need to equip your housekeepers with the tools to do so. By paying someone by the hour, if it takes them an extra 30 to 45 minutes to do the job because they're doing non-housekeeper stuff, that's okay. You've just paid an extra six or nine dollars per cleaning to have a de facto property manager in there every single time that there's a cleaning. You know that housekeepers do so much extra work. If the guest doesn't check out on time they're waiting around for the guests to check out.You might ask them to help shuffle that guest out. That's not a regular housekeeping company's job is it. You get the point here, housekeepers do so much more than housekeeping so paying them by the hour you can keep adding arbitrary tasks to their plate you're just going to pay them more to get it done because you'repaying by the hour. The cool thing about this too is if you ask them to slow down and to do a good job they don't have any ill will about that. Someone who's doing working salary or getting paid by the job has no incentive to slow down because they're not getting paid a single dollar more so if they don't agree with you.You're asking them to slow down and make less money per hour because their pace flat you're going to have an issue with them. By paying someone by the hour, if you say hey slow down and do something better. Take more photos of the place like all this kind of stuff they're going to be willing to do the extra work because they are getting paid for it.
That allows for a much more real relationship between you and the housekeepers. At a high level, I do all sorts of stuff with backup cleaners having people on call what they get paid can change. The holiday pay all this different stuff working on an hourly structure is really cool and it allows you to give people raises. This is good for like the life cycle the business. There's a lot that you can do with hourly.
There are some drawbacks of hourly cleaners. You know you can have people sit around and spend four hours cleaning a place five hours eight hours cleaning a place where they shouldn't have spent nearly that much time. You have to pay them the eight hours of pay for a job that only took two hours and then you have to fire that person and find someone new who can get the job done on time. To prevent this, we have a quota managing process. Your costs can run out of control if you don't manage your people well but if you want to grow your business, if you want to have five, 10, 15, 30 properties, you are going to be managing people or you're going to hire someone that's going to be managing people. Paying by the hour is going to be the move as long as you can effectively manage people and keep them motivated. Keep them happy, keep them fromjust hanging out all day. Your homework after reading this section, is if you guys are going from pay by the job to salary what I want you to do is I want you to start looking around to see can you hire a housekeeper at fourteen dollars twelve dollars ten dollars an hour by running Facebook job ads and see who responds to job ads at different price points. This way, you can start to see what is a competitive hourly price you canyou’reyour housekeepers at. You can start to plan to build that out you really want to do prepare a good system for this. Knowing what you can get your people for is obviously you want to get your people at the best price for you possible, but a price that they won't just go quit and work for someone else. There's a balance here but also being an awesome boss and having great company culture is a factor in that too people don't just leave for the money. We will also talk about company culture in a future chapter.
