It's janitorial contracts. While SaaS companies burn cash chasing retention, ABM Industries has held 98% contract retention for 115 years.

By cleaning office buildings. One contract at a time.

The model: buildings need cleaning daily. You sign 3-5 year contracts. You clean. The contract renews automatically. 98% retention.

1909. ABM (American Building Maintenance) starts cleaning one bank building in San Francisco. Daily cleaning, monthly contract.

Most companies would've stayed local. ABM saw that every office building needs cleaning, forever.

The economics of one building contract: $10,000/month billed. A five-person crew at $18/hour costs $18,720/month, supplies run $1,500, overhead $1,280. Monthly profit: $8,500. Annual profit per building: $102,000. Retention: 98%.

Customer lifetime value: $500,000+ on 5-year contracts. Acquisition cost: $5,000-$15,000. LTV:CAC ratio: 40-100x. Better than any SaaS business ever built.

From the 1960s onward, ABM acquired regional cleaning companies on a repeatable template:

Integration: keep every existing contract, rebrand to ABM for Fortune 500 credibility, centralize payroll and HR, cross-sell parking and security services, standardize training and quality control.

The consistent result: retention rises from 95% to 98%, revenue per building climbs 15-25%, EBITDA margin moves from 6% to 8%.

Phase 1 (1909-1960): organic growth to 500 buildings, West Coast focus. $50M revenue at 5% margins.

Phase 2 (1960-1990): 180 regional janitorial companies acquired, IPO in 1962, nationwide expansion. $850M revenue at 5.5%.

Phase 3 (1990-2010): 280 more companies, parking management, security, and engineering added, integrated facility services model. $4.2B revenue at 6%.

Phase 4 (2010-2026): 190 companies filling strategic gaps, building management system integration. $8.4B revenue at 6%.

Today: 18,000+ buildings serviced, 100,000+ employees, and 98% contract retention across janitorial, parking, security, engineering, and landscaping.

Contracts: 3-5 year terms preferred, recurring monthly (not project-based), office/healthcare/education/industrial buildings, 90%+ retention required.

Financials: $1M-$100M revenue, 4%+ EBITDA improvable to 6%+, no single client over 30% of revenue.

Operations: good reputation with building managers, clean OSHA record, proper liability and workers' comp coverage, established training programs.

Price: small companies 0.3-0.5x revenue, mid-size 0.4-0.6x, large regional 0.5-0.8x — typically 5-10x EBITDA. ABM evaluates 150+ opportunities annually and buys 12-18.

Weeks 1-4: meet every major building manager personally, lock in contract extensions, introduce additional services, ensure zero contract loss during transition.

Months 1-3: implement quality control systems, centralize payroll and HR to cut administrative costs, standardize training, consolidate supply purchasing.

Months 3-6: cross-sell parking management to cleaning clients, add security services, offer engineering and HVAC maintenance, bundle services to raise contract value 20-40%.

Months 6-18: optimize staffing levels, implement scheduling software, renegotiate contracts at higher rates, add value-added services.

Average improvement in 24 months: retention +3-5 points to 98%, revenue per building +22-35%, EBITDA margin +2-4 points, employee retention +15%.

Before: an independent with 40 buildings at $120,000 each does $4.8M revenue and $288K EBITDA (6%), selling for $2.4M at 0.5x revenue.

After integration: 41 buildings at 98% retention, $156,000 revenue per building from bundled services, $6.4M revenue (+33%), $551K EBITDA (8.6% margin, +91%).

The arbitrage: buy at 0.5x revenue (8x EBITDA), nearly double the EBITDA, improve retention to 98%, and hold inside a public platform trading at 11-12x EBITDA. That's roughly 1.5x multiple expansion plus 91% EBITDA growth — 3-5x total value creation per acquisition. ABM's totals: roughly $3B invested over 115 years, a $5.9B market cap, $4B+ in dividends. Over $9.9B created.

There are 32,000+ commercial cleaning companies in the US. ABM, C&W, CBRE, and others own 18%. 82% remain independent, 26,240 companies, average owner age 57, with 8,000+ actively marketed.

Why now: office occupancy is up 40% since 2023, hospital cleaning requirements have increased, independents can't hire and retain cleaners, building management systems require integration capital, and 72% of owners have no exit plan.

Adjacent facilities plays: parking management (0.5-0.8x revenue asking), security services (0.4-0.7x), and HVAC/engineering maintenance (0.6-1x).

Path 1: Build SaaS. Burn $2M-$10M. Chase 90% retention. Hope for multi-year contracts (89% fail).

Path 2: Get direct access to cleaning companies for sale. Buy 98% retention. Acquire 3-5 year contracts. Exit at 12-18x EBITDA.

The contracts are there. The buildings need cleaning daily. The retention is proven. Our average buyer closes their first cleaning company acquisition in 4-6 months.

On this call, we'll identify cleaning companies with strong contract portfolios, show you owners age 55+ with no succession plan, and map out your path to building a platform with 98% retention.

This isn't for browsers. This is for buyers.

Stop chasing retention. Start owning it.

Thursday, September 10, 2026

ABM's average acquisition closing time: 60-90 days. They've done 650 deals over 115 years. Our buyers are following similar timelines. The contracts are real. The retention is 98%. The buildings need cleaning. The question is whether you'll take action this week.