Editor's note: This article was excerpted from the Personal Concierge start-up guide, available from Entrepreneur Bookstore.
A personal concierge service runs on the most basic of premises. People want things done but don't have the time to do them. But they're happy to pay someone to take care of their business efficiently and with a touch of class. Why not let that someone be you?
Although personal concierge services are a fairly recent development, the number of companies that serve time-starved clients is mushrooming, right along with customer demand for such businesses. One San Francisco-based concierge business saw its client base double in 1996 and continue to grow up to 50 percent annually for several years after that. Some 2,000 miles away, a Chicago concierge firm that began with 25 clients in 1997 grew to service more than 85 clients in just a few years. Membership in the National Association of Professional Organizers, which includes some professionals who provide concierge services, swelled from a few hundred when founded in 1985 to more than 1,100 members by the late 1990s.
Why the booming demand for concierges and organizers? A big reason is that most people have accumulated so much stuff--both in the workplace and in their homes. Just glance at your desk or kitchen counter, and you'll probably see stacks of papers, bills, correspondence, etc. In fact, in a recent survey by Steelcase, a leading designer and manufacturer of office furnishings, 27 percent of office workers described themselves as "pilers," while 12 percent described themselves as pack rats. Taking care of all that "stuff" requires time and organization. Some people need help just to get organized; others could manage the paperwork if they weren't saddled with so many other chores. That's when they turn to (or would like to be able to turn to) professionals to help keep them organized, run errands, and see to it that business and personal obligations are met.
Although it's no secret that the personal concierge field is booming, hard numbers are difficult to come by. The National Concierge Association, a Chicago-based group that was founded in the late 1990s as a networking and resource organization for both personal and hotel concierges, doesn't yet track numbers or statistics pertaining to the industry. Cynthia A., a former hotel concierge who runs her own personal concierge business in San Diego, estimates there are a few hundred personal concierges throughout the United States, along with thousands of hotel concierges. Several other personal concierges and concierge consultants agreed with that estimate but said the number of personal concierges is growing fast.
According to Sara-Ann Kasner, president and founder of the National Concierge Association, "The concierge business is exploding right now. There has been tremendous growth." Personal concierges and industry analysts say there is plenty of room for even more growth.
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Who uses personal concierges? Everyone from the millionaire corporate chairman to the single mom with two jobs and three children under age 10.
Concierges are finding their services are needed more than ever--not just by Mr. Corporate, but by Josie Average, too. As mid-level workers get busier and busier, they're becoming more and more comfortable with the concept of passing along their errands to personal concierges. And in an effort to attract and retain employees, more and more companies are offering them personal concierge services.
In today's competitive job market, employers are finding they not only need to create a safe-and-supportive environment for their employees, but they must also give employees benefits that help them balance the demands of work and personal commitments. Some companies have found that their employees are putting in so much overtime and working such long hours that they don't have enough hours left in the day to attend to personal business. Employers in certain fields, such as insurance, banking and manufacturing, have found that offering help to their time-stretched employees can boost productivity, making this a workplace perk that benefits the business as well as the workers. For this reason, more employers are offering personal concierge services to their employees.
Industry experts predict we'll be seeing more and more personal concierges serving businesses in the near future. These personal concierges aren't to be confused with corporate concierges; they're not actually corporate employees--more like corporate suppliers. Personal concierge operators are contracted by corporations to provide concierge services, either on-site or on call.
Finding Your Niche
As an aspiring personal concierge, you need to decide what your niche will be. For instance, will you cater strictly to corporate clients? Will you specialize in particular areas for clients or offer more broad-based services? Some personal concierges specialize in one area, such as lining up tickets for concerts or special events; others pride themselves on running every errand imaginable. You need to spend some time thinking about what type of service you want to provide.
Services to Offer
With the industry growing and developing the way it is, it's impossible to give a complete list of services personal concierges provide. Who knows what new service might be offered next week? But this list of some of the services personal concierges can offer might help you come up with a few ideas for services you can provide to your clients:
- Light housekeeping
- Waiting in line at the DMV
- Car repairs, oil change, car wash
- Event planning
- Plant care
- Picking up dry cleaning
- Running miscellaneous errands
- Relocation services
- Making travel arrangements
- Mail pickup
- Meal pickup; some chef services
- Dinner reservations
- Interior decorating
- Maid service
- Carpet cleaning
- Concert/movie reservations, etc.
- Grocery shopping
- Locating hard-to-find items and collectibles
Startup costs for a personal concierge business are estimated to be between $2,000 and $4,000, if you already have a computer and other office basics. If not, the figure could be considerably higher, depending on what kind of computer system and other office supplies you choose to buy.
Since it's a service-based business rather than a product-based one that calls for inventory, starting a personal concierge business doesn't require a large financial investment. In fact, much of what you'll need to be a good concierge can't be bought--for instance, the contacts that come from long-term business relationships with the right people. You can't put a price tag on those contacts, but having them puts you well on the way to success.
You'll still need all the basics, though. Here's a rundown of what you'll need to get your business off to a roaring start:
- A good computer system with a modem, Zip drive and printer
- Software for accounting and contact management
- Fax machine
- Phone with two or three lines
- Answering machine or voice mail
- Cellular phone
- Office supplies and stationery
- Internet access
- Legal and accounting services
- Startup advertising
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Income & Pricing
Personal concierges can expect to make anywhere from $40,000 to $60,000 a year, depending on how many clients they take on and the range of services they offer. In addition, concierges often receive tips or gifts from grateful clients.
Concierges can bill their clients in a variety of ways. For instance, some charge membership fees based on how many requests are usually made per month. Others bill on monthly retainers, while others charge per service or per hour. It's your game, and you can tailor it to meet your needs.
When asked to put numbers to their fees, concierges say their typical charges would work out to be anywhere from $25 to $125 an hour, depending on the particular task. If concierges dip into their own money to purchase something for a client, the client is billed for the item later.
Some personal concierges also receive what are known as "referral fees" from various companies when they steer business to them. Companies that often pay referral fees include wedding planners, caterers and florists. Many concierges pick up extra income via this avenue.
What Will You Be Paid?
You might be wondering how your clients will be billed or what to charge for your time and efforts. In the rapidly developing personal concierge industry, how you charge your clients is another one of those gray areas with no set-in-stone guidelines. What and how you're paid for your efforts is another area that you will have to research and design along the lines of your own preferences and ideas.
Most of the concierges we talked to charge their clients membership fees. Some memberships allow a certain number of requests each month for one annual fee. For those types of memberships, annual fees might start at around $1,000 to $1,500. Other memberships might be available for a smaller annual fee. For instance, if a client wanted to use the concierge services only once or twice a year for small errands, a fee of $500 might be established. Fees and contracts vary among concierges and clients.
Corporate clients are generally charged much higher fees because they require more services per month. For corporations, membership fees will vary widely depending on the size of the company and how many requests each employee is allowed. Again, most concierges declined to divulge exact fees, but a ballpark annual fee for a corporate client with many employees who are each allowed multiple requests each month could start at about $5,000. More employees and a greater number of requests could drive the fee much higher.
A Day in the Life
Wondering what a regular workday might be like once you get your business off the ground? Of course, "regular" means different things to different people. Many variables may affect your day, such as whether you have a home office or an office away from home; whether you're working full time or part time; and whether you serve mostly corporate clients or mostly personal clients.
To give you an idea of what the workday could be like, we asked Cynthia A. to detail a typical day (if such a thing exists for concierges) in her work life.
"Well, today, for instance," she told us, "I have a client who lives in Virginia and has a relative moving into a nursing home in San Diego. The family couldn't fly out on such short notice so I handled all the details. I went over to the relative's home and helped a mover pack things up.
"There were things that I could tell were personal mementos, so I gathered a few of those and I took them to the relative, who was in the hospital recuperating from a stroke. And when I stopped by the hospital, I ended up staying over an hour and sitting with someone I'd never met because I knew she didn't have anyone else nearby."
After she left the hospital, she made some arrangements for another out-of-state client who wanted to spend Christmas holidays at his beach house in California. "I took care of all the details to set up a Christmas tree at his beach house, as well as making arrangements for his mother to send a package to me with his own Christmas ornaments," she says.
She spent the rest of her day returning phone calls, answering e-mails, meeting with the partners at her company, and being interviewed for this book.
Was the day Cynthia described a typical day for her? Well, she and the other concierges we interviewed said that no two days are alike in their business and that variety is one of the aspects that drew many of them to the business. The one thing they know they'll be doing every day is juggling many tasks, and they must be prepared to do that.
Concierges also say no two clients are the same. Some clients call and want something done yesterday; others generally give the concierge some notice. But as a rule, most concierges said they receive lots of last-minute requests. "It can definitely throw a wrench in things if you're going in one direction and have to change your pace," Cynthia says. "But it's also par for the course, and it's one of the things I enjoy about my work--the unknown."
Letting the world know your business is up and running will bring clients your way. Start by attending some casual business functions and passing out business cards. For instance, find out when your local chamber of commerce, Rotary Club or Toastmasters group holds meetings. Often, they hold breakfast meetings that can be good "meet and greet" opportunities. If you have the time, start your own networking group. You can hold meetings at a local restaurant or even line up a seminar room at a college or university and publish a print or e-mail newsletter to keep members informed of meeting times and dates.
Put ads in the paper. A few of the concierges we talked to had some luck with newspaper ads, while others found they had better results from listings in the Yellow Pages. If you're trying to cut costs, you might not want to spend all your money on expensive advertising. If that's the case, have fliers made up and get permission to post them on bulletin boards in community centers, doctors' offices, dental clinics or in break rooms and cafeterias of large companies. The fliers route is one of the least costly, depending on how much you spend for the printing. You can also send sales letters to potential clients.
Of course, there is always (gulp!) cold calling. Nobody ever looks forward to cold calling because of the fear of rejection. Admittedly, it's no fun calling 10 people in a row who say no to your pitch. But if you stick with it, that 11th call could bring a yes and lots of new business.
There are many other ways you can get the word out. You can send informational packets or brochures about your company to the human resources departments of large corporations in your area or deliver brochures to smaller offices. You might also join a mailing service and send your sales letters and other materials to people on mailing lists. Mailing lists focus on all types of demographics, and you can request any particular one you want to target. Dual-income families and successful businesspeople are two groups that are more likely to need concierge services, so keep this in mind when you're selecting mailing lists.
- American Errand Runners Organization
- National Association of Professional Organizers
- National Concierge Association
- The NCA Newsby the National Concierge Association
- NAPO Newsby the National Association of Professional Organizers