Debtosh Chatterjee, CEO & MD, Chatterjee Cleaning Arts Services Pvt Ltd (CCASPL)
Starting out of a single room, Debtosh Chatterjee, CEO & MD, Chatterjee Cleaning Arts Services Pvt Ltd (CCASPL), has spent 30 years building up a very well reputed facility management company from scratch. Here, he shares some bare-knuckled advice for startups.
What do’s and don’ts would you advise a start-up at the very beginning?
Don’t enter the business if you are not passionate enough. Many try it since someone else is doing it; no stopgap approach please. Secondly, a business needs many skill sets to start/run. Just an individual with a strong operational base may not write a success story. One should be good at many skills such as marketing, team building, operations and most importantly, leadership.
Do make your math correctly; profit does not mean cash flow. Financial concepts like cash flow, working capital cycle etc should be learned. Many businesses close down just because of lack of financial management.
Lastly, have the right mix of funding . Don’t forget that bank funding is the best funding; equity funding is the costliest.
Keeping financial constraints in mind, how would you advise them to approach selection of the right machines, tools and chemicals?
There is no universal answer for this. If someone keeps the cost for these as variable costing, he/she has a much wider choice. In most cases, cleaning machines are an area of concern. My suggestion would be to go for the best always, and not to compromise in terms of costing.
How can manpower be effectively managed?
For a start-up, my advice would be that the entrepreneur should take the team management role for himself/herself. Quickly build up the second person in command, and then pass the responsibility on to the team. This takes time and will come after a lot of failure. There is no shortcut; it has to be trial and error based.
As startups begin to grow, how should they manage resource deployment across multiple client sites?
If it’s billable, there should not be a problem but for the back office/supervisory/managerial posts, it will take time to stabilise. Initially, the promoter will bear the cost directly. As the business progresses, this should be shared with multiple sites. One more approach could be to start add-on services such as pest control, carpet shampooing , stone polishing.
How can documentation be made foolproof, consistent and effective?
You cannot have foolproof documentation. But to minimise the risk, please get standard documentation made with the help of a legal advisor.
What other advice would you give them for sustainable growth, client retention and improved profit margins?
There is only one mantra – stick it out. This is a low-margin, high-volume business with various compliance challenges and is full of human interference (errors and mistakes are possible and probable). Be ready for a high rate of attrition. Client loyalty is also very rare.
On the positive side, there is a huge value proposition for the customer life cycle if you can play a long innings. There will be no stagnation of business at least for the next 10 years, if not more. The market will always be robust and can accommodate many more players.