Use this checklist to assess businesses in this industry for SBA 7(a) lending and underwriting.

Owner Labor + Subcontractor Structure

• Does the owner personally perform cleaning tasks?
• Are subcontractors or W-2 employees used?
• Has labor been normalized for market rate?
• Is business continuity possible without the owner?

Client Contracts + Revenue Stability

• Are contracts in writing or verbal/short-term?
• What % of revenue comes from top 3 clients?
• Are there cancellation clauses or auto-renewals?
• Are recent client losses or gains disclosed?

Payroll + Addbacks Review

• Is labor cash-based, underpaid, or undocumented?
• Does payroll include family members or non-arm’s-length workers?
• Are vehicles, mileage, or fuel used personally?
• Are uniforms, tools, and supply reimbursements adjusted properly?

CapEx + Equipment Inventory

• Is there a complete list of equipment (vacuums, vans, buffers)?
• Has CapEx been normalized for replacement cycle?
• Are tools and assets personally owned or leased?
• Any deferred investment that impacts serviceability?

Red Flags

• Owner is primary cleaner or account manager
• Addbacks = personal auto, family labor, or supplies
• No client contracts or high concentration risk
• No equipment list or CapEx history provided

SBA SOP Tip

SBA-compliant valuations must reflect verifiable contracts, normalized labor, and recurring cash flow. A cleaning business without systems or written agreements may not be transferable at FMV.