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Cost Containment-12

  Janitorial and Landscaping Services

  Spell out specific expectations, and use a log to communicate to vendors who work while your staff are away.
 

Chapter 1

Cost Containment Defined

Chapter 2

Purchases of Standard Items

Chapter 3

Postage & Overnight Delivery

Chapter 4

Vehicle Maintenance

Chapter 5

Telecommunications

Chapter 6

Printing

Chapter 7

Cost Justification Strategy

Chapter 8

Buying Photo Copiers & Capital Equipment

Chapter 9

Time & Materials vs. Service Contract

Chapter 10

Advance Payment for Short Run Services

Chapter 11

Penalty Clauses for Non Performance

Chapter 12

Janitorial & Landscape Services

Chapter 13

Paper Records Storage

Chapter 14

Freight

Chapter 15

Lighting & Pollution

 


 

All rights reserved, including

 the right of reproduction in

whole or in part in any form.

Copyright ® 2003 by

Gene Constant, CPA, MBA

 Services can be difficult to purchase, primarily due to poor communication. The provider sometimes doesn't know exactly what is expected of him, and the user does not always understand what her contractual dollar provides.

Regarding the procurement of janitorial services, the easy part of the pricing equation is to determine the number of square feet and the population density of the structure. The costly and more difficult part of pricing a contract has to do with the level of service desired, as well as soft-dollar costs regarding user satisfaction, management attention to issues between user and provider, and insurance claims created from using the vendor. To obtain your best value, offer a "winner-take-all" contract, offering all of your business to a solitary vendor, when and if it is possible. Then you can take advantage of volume discount.

Of course, the employee, who is not concerned with the expense, wants her space to be cleaner than her own home. As budget manager, it is up to you to set cleaning criteria.

I recommend a basic level of service be provided two or three times per week, with a comprehensive cleaning (outside windows, carpets and baseboards) every six months. To keep costs down, require employees to be responsible for their own desks and for emptying their own wastebaskets in a nearby, common, trash container.

Your explicit service requirements must be written and included as an addendum to your contract, and given to the department manager. This formal and complete disclosure will prevent most complaints about poor service, because everyone will clearly know for what each is responsible. Also, you should insist upon a complaint/service log for each facility. This log should be used as a means for the cleaning crew (who generally do their work at night) to communicate with the daytime employees. This formal communication should be collected quarterly and sent to the proper manager, who should utilize the log as one way of evaluating the level of service provided.

You may ask why a contract is needed for this simple task, performed by minimum wage persons, in the middle of the night. The answer lies in the issue of liability, in cases of accidents and property loss. The janitor has unsupervised access to your facility. The problems this causes include petty theft, damaged fixtures and false-alarm expenses. Many of these mom & pop cleaning firms lack property damage and liability insurance. Any claim will land squarely at your feet. A contract with proof of insurance avoids that problem.

Regarding cleaning costs, we saved a substantial sum of money by implementing a self-help program. To save money and staff jobs, we all agreed to take turns cleaning the lobby, bathroom and break room, on a weekly, rotating schedule. Each person was responsible for his own office space. We hired janitorial service only for an annual carpet cleaning, sharing the money saved with the company. The company retained 50% of the expense as a savings, and the "self-help gang" used the balance for free lunches. Occasionally, we did get a slacker who didn't want to clean, but loved to eat. In most instances, peer pressure resolved those bumps.

Final word of advice, do not purchase supplies from your cleaning service. Toilet paper and other items are found much cheaper elsewhere, as these people generally only provide product as a convenience to you. However, cleaning firms generally purchase their supplies from a discount environment, such as from the Price Club. As with any other firm, the cleaning firm will mark-up the cost of product to you, from anywhere between twenty to fifty percent. After all, they are providing a convenience, and price is commonly overlooked.

LANDSCAPE SERVICES

With regard to landscape procurement, I buy this service almost exactly the way I buy janitorial services. The problems are similar, except the work is performed during the day, rather than at night, and outside, rather than inside. Regarding indoor plants, I recommend that employees adopt a plant to permanently maintain, or to purchase artificial and/or dried floral arrangements. Your primary guide to asking the right questions and controlling this expense is to utilize the Landscaping Contract, which is shown after the Janitorial Contract, at the end of this chapter.

RESULT: The formal, contractual process affords minimal complaints, which in turn results in lower, management expense. Liability is also reduced or transferred to the vendor, minimizing a possible change in insurance rates, due to fewer claims. Lastly, up to a 50% savings can be realized by an innovative sharing of responsibility.

JANITORIAL CONTRACT


THIS AGREEMENT, between (Company) hereinafter called (THE FIRM),and ____________________________________________________________
Address_____________________________________________________
Phone_______________________________________________________
hereinafter called CONTRACTOR.
W I T N E S S E T H:


1. DUTIES OF CONTRACTOR. The contractor shall furnish all labor, material, equipment and supplies required to satisfactorily perform all of the janitorial services required by THE FIRM in and about the premises hereinafter described, in an acceptable manner and to the satisfaction of THE FIRM, including but not limited to the services described in "Exhibit A" attached hereto and by this reference made a part thereof.
The property in which said services shall be performed is known and described as:
FIRM________________________________________________________
Address_______________________________________________________
Phone________________________________________________________
 

2. TERM. This contract shall commence on________19___, and shall continue in force as set forth herein unless terminated according to the provisions set forth below.
If at any time the Contractor violates any of the provisions hereof, or performs in an unsatisfactory manner, in the sole judgment of THE FIRM, or in the event the premises or a major part thereof be sold, leased, vacated, demolished, or if the place of doing business is relocated or substantially changed, THE FIRM, in any of such events, may on three (3) days written notice to the Contractor terminate this contract. This Contract may be terminated for any other reason on thirty (30) days written notice by either party.

3. CONTRACT PRICE. THE FIRM shall pay Contractor, upon receipt of Contractor's invoice, on or before the tenth of each and every month during the term of this agreement, after the services have been satisfactorily performed for the preceding month, the sum of $______, for faithful performance of all the services herein required of Contractor, and Contractor agrees to accept said sums in full payment for any and all services rendered by Contractor or Contractor's employees and for equipment and supplies furnished or used in connection with this agreement.

No change in the contract price will be allowed earlier than one (1) year from the commencement date shown in item "2.TERM" above, and subsequently, no earlier than one (1) year from the effective date of the last previous change. Any request for price change must be presented in writing to the undersigned a minimum of 30 days prior to the requested effective date.

THE FIRM reserves the option to deduct from payments due Contractor, a pro-rata amount for any normal service day that service is not performed (legal holidays excepted), based on the normal price divided by the number of service days in the month in which service was missed.
THE FIRM reserves the option to deduct from payments due Contractor, any and all sums THE FIRM must pay, as a result of the Contractor not following security procedures upon entry or exit of the premises.

4. CONTRACTOR IS INDEPENDENT CONTRACTOR. In carrying out the provisions of this contract, the Contractor shall not be under the control or direction of THE FIRM in any way except as to the result of the work to be done. No employer-employee relationship of any sort shall exist between employees, agent, and servants of Contractor and THE FIRM.

5. INDEMNIFICATION AGREEMENT. Contractor agrees to indemnify, defend and save harmless THE FIRM for any and all loss, liability, damages, claims, or demands or expenses (including attorney's fees) of any kind caused by the negligence or misconduct of Contractor or its employees while engaged in the performance of any of the provisions hereof, or in any way related to Contractor and/or its employees having access to the premises or its contents.

6. CONTRACTOR TO REPAIR DAMAGE. All damage, scars or disfigurements to any materials or property constituting a part of or contained in said premises, resulting from the methods or materials used or employed by the Contractor or from the acts of its employees, agents or servants, in fulfilling its duties hereunder and accomplishing the purposes hereof, shall be promptly repaired or replaced by the Contractor at its own cost; such repairs or replacements to be made to the satisfaction of THE FIRM.
7. INSURANCE. Contractor shall secure and keep in force during the life of this agreement at its sole cost and expense the following insurance policies with companies acceptable to THE FIRM.


(a) Property Damage and Liability Insurance
Contractor shall maintain a policy of property damage and public liability insurance which shall protect THE FIRM, the owner of or person occupying the premises described in paragraph "1" above and such other entities as may be designated by THE FIRM against any liability for damages, for injury to or theft of property or for bodily injuries including death, suffered or claimed to have been suffered by reason or in consequence of any act or omission of any employee, servant or agent of Contractor. The liability coverage under such insurance shall not be less than $500,000 for any one person injured or killed, not less than $500,000 for any one accident and not less than $500,000 for property damage. Contractor shall furnish THE FIRM with one (1) certificate of all said policies.


(b) Worker's Compensation Insurance.
Contractor shall maintain coverage in non-performance with the Worker's Compensation Law of the State of XXXX. Contractor shall furnish THE FIRM with one (1) certificate of all said policies, including an endorsement which states that such insurance will not be cancelled or amended until THE FIRM shall have been given thirty (30) days notice in writing of the intention of said insurer to cancel or amend any such policy. Each such policy (other than the property damage policy) shall contain a provision that the insurer and all other persons shall have no right of sobrogation against THE FIRM and such other persons as THE FIRM shall designate as insureds thereunder. All payrolls of contractor upon which premiums for any insurance required hereby may be calculated shall be subject to verification by THE FIRM.

8. ASSIGNMENT AND DELEGATION. This is a contract for personal services and Contractor represents and warrants that it and its employees shall perform the contract work. Contractor shall not assign this Agreement nor delegate any of said work without the written consent of THE FIRM. In the event Contractor delegates any portion or part of this Contract, Contractor shall remain fully liable for the subcontractor's timely and proper compliance with all of the terms of this Agreement.

9. NO FEES TO AGENTS. Contractor represents and warrants that the execution of this contract is not contingent upon the payment of any fees to outside agents. If in fact any such fees or commissions are due, they are the sole responsibility of the Contractor.
CONTRACTOR:__________________ THE FIRM

By:_____________________________ By:__________________________
signature signature

Title:___________________________ Title:_______________________

Date Signed:___________19___ Date Signed:____________19__

Never sign a contract with an automatic extension and never give a contract a life span of more than 24 months. Always build in an opportunity to re-bid.
 

LANDSCAPE CONTRACT

The following "exhibit A" would be a part of the aforementioned Janitorial Contract, when contracting for landscaping services.
"EXHIBIT A"
Specifications for Landscape Maintenance
Contractor shall furnish all labor, materials, equipment, transportation, insurance, taxes and any other items of cost necessary to perform the complete landscape maintenance services including (but not limited to) the following services:
Work Included:


a. Maintain lawns by mowing, weeding, raking, airification, fertilizing, reseeding, and watering as necessary to maintain the turf in a thick and healthy condition all year.

b. Maintain ground-cover by cultivating, weeding, fertilizing, spraying, pruning, and edging, mulching, watering and replanting care areas.

c. Maintain trees and shrubs in a healthy, thriving condition by pruning, shaping, watering, fertilizing, staking, mulching, spraying and replacement.

d. Maintain sprinkler system in proper working order by cleaning and adjusting heads and risers and replacing any broken units, control valves, wires, and properly adjusting the schedule on the automatic controllers. Repairs to the system, when required for reasons other than contractor caused damage, will be pre-authorized, and charged for on a time and material basis.

e. Maintenance cleaning will include the removal of all debris from planted areas by raking and hand pick-up, washing down of walks, curbs and gutters adjacent to work area, removal of all debris from site, upon completion of work, at no additional cost to (THE FIRM).
Materials:
a. Commercial fertilizer shall be 16-6-8, or higher concentrate.
b. Mulch shall be nitrolized redwood shavings, or comparable substitute approved in advance.

Work Schedule & Description:
Lawns:
a. Mowing shall be performed at such frequency as may be required by the season of the year, but at least once each week, at a height of 1.5 inches to 2 inches, collecting all clippings in catches.

b. Edges shall be trimmed at each mowing. Trim around trees, valve boxes, and all other items each mowing.

c. Remove all weeds by whatever means necessary.

d. Grass shall not be allowed to invade plant areas and other areas not intended to be lawn.

e. Contractor shall control gophers and moles by trapping or poison gases. Contractor will maintain continuous control against insects, sod web worms, cut worms, grubs and fungus in turf grass areas by treating with appropriate chemicals.


Ground-Cover:
a. Cultivate weekly and remove all weeds by digging out the roots.

b. All ground covers shall be trimmed neatly away from shrubs, trees, walks and header boards, tapering edges.
 

Shrubs:
a. Cultivate weekly and remove all weed growth.

b. Remove all spent flowers and hand prune as a continuous operation to remove undesirable growth.

c. Hose off plants weekly to remove accumulated dust.
 

Container Plants - Outdoor:
a. Check weekly for water, do not over water.

b. Remove old leaves and hose off plants to remove accumulated dust.

c. Remove rubbish from containers weekly.
 

Trees:

a. Provide water to insure proper growth. Deep water during dry seasons.

b. Prune to remove dead wood, low branches, misshapen or mis-directed branches and damaged wood. Prune in fall, for general clean-up. All cuts over 1/2-inch diameter in size shall be treated with pruning compound.

c. Loosen ties and repair staking as required.

d. Size of a tree determines if its care is included in the charge for this contract. Any tree with growth which cannot be reached from a six foot ladder, or from the ground with a pruning pole, is not included. Any work on these trees above the height described, is an additional expense and must be pre-approved.


Fertilizing and Mulching:
a. Lawns shall be fertilized four (4) times per year with 16-6-8 commercial fertilizer at the rate of 10 pounds per 1,000 square feet. Other compositions may be used for particular soil conditions upon approval by (THE FIRM).

b. Shrub and ground cover areas shall be fertilized twice per year with 16-6-8 commercial fertilizer at the rate of 10 pounds per 1,000 square feet.

c. Azaleas and other acid loving plants shall be fertilized with acid food, three (3) times per year. Application shall be made after the blooming period.

d. Ground-cover and shrub areas will be mulched as needed with 1.5 cubic yards of nitrolized shavings per 1,000 square feet.

e. All applications of fertilizer shall be performed according to the manufacturer's instructions and well-watered immediately after application.


Area Policed:
a. At the time work is performed, all turf, shrub, rock and garden areas are to be policed and all loose trash and debris removed.

b. Clear all plant clippings from walk areas.

c. Maintain bedding materials, bark, rock or mulch, in proper areas.


Not Included:
Replacement or addition of plant materials, tree work beyond Contractor's capabilities - as specified and repairs to sprinkler systems, when required, for reasons other than damage caused by contractor, and not included in the contract charges. Such work is to be estimated and submitted for approval. A Purchase Order will be issued for such work. Contractor is to invoice separately against the Purchase Order in such cases.
 

                       
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