The cleaning company ProfilService is a significant supplier of quality cleaning and window cleaning on Zealand. The company has always had long-term customer relationships with both businesses and the public sector, and the built-in growth engine in the stomach of the two directors has always been reflected in impressive figures on the bottom line. At the same time, ProfilService has a tradition of a high proportion of people with other ethnic backgrounds among the employees who, due to language difficulties, among other things, have had difficulty entering the labour market. There is nothing special about that. The same is true for many other cleaning companies. But if you take a closer look at ProfilService, you will quickly find out that this is a company that stands out. “Social responsibility is part of our set of values and culture. It is a strong driver for our identity and a growing competitive parameter.” This is what it says in ProfilService’s Social Development Plan for 2021.
“We have an ambition to grow and to further increase our social responsibility, including through a more efficient organization of our efforts, with the goal of becoming a leading role model for socially responsible companies in our market segment,” says Steen Meedom, CEO of the company. Chairman of the board and now former main owner Per Jens Nielsen elaborates that social responsibility is shown through the efforts the company makes to integrate and retain its employees: “With us, you don’t just become good at cleaning. That’s actually the smallest part. We use a lot of resources to ensure that our middle managers have close contact with the employees, and that they help and guide them with everything you need to know to be part of Danish society. It can be to get an Nem ID, to enroll the child in kindergarten, to read your tax return or to contact the municipality.”
Training to be part of society
In order for the middle managers to be able to handle this task, ProfilService has set up a “Profile Academy”, where you get the necessary skills to be able to guide the employees in general social issues. “Our middle managers must be able to help the employees with everything. That is why we have created the “Profile Academy”, where they learn about Danish society and building relationships. It has nothing to do with cleaning, but when you have a staff where 90 percent are of other ethnic backgrounds, then relationships and being able to get along in a society are the most crucial,” says Steen Meedom. For this reason, ProfilService has employed more middle managers than other cleaning companies. “In other cleaning companies, a middle manager is typically responsible for 50 jobs. With us, they have a maximum of 30 workplaces and thus also fewer employees. It gives music at the other end that they have more time for the individual. You can’t integrate if you don’t have the time for it,” says Per Jens Nielsen.
Retention yields gains on several bottom lines
The salaries of the higher number of middle managers should mean lower earnings. But this is not the case: “In the industry in general, there is a turnover among cleaners of 50 percent per year. With us, it is less than half. A large part of the explanation is that the employees are happy with the close contact with their manager. And that’s where the math comes in. Because even though it is more expensive to hire more middle managers, we save money as we have fewer replacements, as it costs DKK 6-7000 each time you need to hire a new employee. When we did that calculation, we thought, a mistake must have been made. But we have not. It clearly pays to have increased leadership. This provides benefits on both the financial and the social bottom line,” says Per Jens Nielsen.
Investor with the same mindset
Over the years, however, ProfilService’s social efforts have been more culture-borne than formalized. Therefore, Den Sociale Kapitalfond Invest was the right match when the company was recently looking for an investor. “Den Sociale Kapitalfond Invest has the same mindset as us about creating attractive financial returns with a positive social impact. Therefore, we were in no doubt at all when we met Mads and Lars from the private equity fund, and now we have great expectations for the collaboration on, among other things, developing social agreements, engagement and clauses. In other words; to further develop our social focus and formulate it, so that we can also measure it, tell the outside world about it and attract both new customers and new labour on it,” says Steen Meedom. Den Sociale Kapitalfond Invest bought 57.5 percent of the shares in December 2020. The foundation is built on a philosophy that social responsibility and “impact” are good business in more than one sense – and that the successful companies of the future will not only be measured by profit or economic growth, but also by the ability to contribute to solving societal challenges. “In our perspective, social contribution and social responsibility are increasingly a key to attractive workplaces, good reputations and strong customer relationships. It is not only common sense, but also good business. Therefore, ProfilService is an exciting company to become a part of,” says Managing Partner, Lars Jannick Johansen.
Strengthened competitiveness
He adds that the starting point for the fund is always to look at where the company is going commercially and what growth and market potentials there are. “Then you have a company, such as S. ProfilService, which has great potential when it comes to social responsibility, we believe that we can strengthen competitiveness by further developing and making socially responsible to the company’s customers visible,” he says. And that is exactly the next step for Profilservice. With the backing of Den Sociale Kapitalfond Invest , ProfilService will develop and win new customer assignments based on competence, price and social commitment, as well as to draw up social partnership agreements with existing customers, half of which are private companies and the other half are public workplaces, schools and universities.
“We have already announced to our customers that we will be working even more with the social profile, and we have only met positive attitudes about this. Now the next step is for our customers to become active participants in the collaboration on social responsibility and thus contribute to the spread of more people being able to do more together. And that even more workplaces can and should see potential in employing people from the margins of the labour market,” explains Steen Meedom.
Many interested investors
The interest in ProfilService among investors was also unmistakable when the company announced that they were looking for an investor at the end of 2020. “There were a lot of investors who wanted to get on board. And it would probably have been easiest to just choose an industrial investor. Then we would have just fit into their portfolio, and we could have taken the money and run,” Per laughs. “With the Social Capital Fund Invest, we have entered into a binding collaboration, where a lot is required of both us and them. We are held up that while we develop financially, we also create social results. So we’re really happy that we did,” he says. Neither Per nor Steen knew much about Den Sociale Kapitalfond Invest when they contacted ProfilService. “When Den Sociale Kapitalfond Invest came on the scene, we looked at each other and thought, what is this? But we had a meeting with them, and it didn’t take many half hours before we realized that these gentlemen had familiarized themselves very well with our business and our industry. It gave me tremendous respect,” says Steen Meedom.
Sustainable Development Goals create stronger focus
For ProfilService, hiring people from the edge of the labour market has been a natural thing from the very beginning of their collaboration in 2014, when Steen bought into the company. But in the time since the creation of the UN’s Sustainable Development Goals in 2015, it has been clear to the two directors that society calls for exactly the innovation they stand for. “The adoption of the SDGs has given companies a common language and a platform for action, creating a new way of doing business and talking about business. But even though the premises for good business practice have changed, we can only achieve the SDGs if we also translate them into good business. If we create a positive effect for society, which we use as a lever for a successful business. And again, this is something we can see that Den Sociale Kapitalfond has extensive experience in contributing to,” says Steen Meedom.
The important relationships
Steen Meedom and Per Nielsen have extensive experience in creating long-term relationships with customers by delivering good work and having an ongoing, honest dialogue about the company’s service solutions and their possible development opportunities. “When Steen joined the company in 2014, large-scale operations set the tone in our industry. But we went the other way. We would rather have fewer customers, and then time to look after them, visit them. Follow up on agreements. Be in dialogue. And we wanted to be good at dealing with our employees. So we could retain them. The better the retention and stability, the higher the service our customers receive. These were the main headlines of our concept. Good relationships and a large and well-developed network mean that Profilservice does not use canvas sales. “It is a great advantage that we have such an expanded network that people talk about our company. Both when we bid on tasks and when we have to look around for new employees,” says Per Jens Nielsen.
A Strong Pioneer Spirit
Although retention is an important theme in ProfilService, where there is a particular focus on developing skilled and ambitious cleaners and possibly further training them to become middle managers, it is also important for the two directors that employees who have the ambitions and qualifications to do so move on in the labour market. “It should not be an ambition that you want to spend your whole life cleaning. It must be an ambition to exploit the potentials you have. So being in ProfilService can be a good starting point where you can learn the language and how to get along in society. But we are pushing so that those who have ambitions to do so come out and educate themselves or take other jobs,” says Steen Meedom.
The mission to retain, educate and later help those who are ready to do so further into the labour market is for Steen and Per one of the most important parameters in good corporate governance. “A strong pioneering spirit and the strong commitment and unity in the entire employee group are crucial to ensure our continued development and good results,” says Per Jens Nielsen. In order to also strengthen the commitment of managers, middle managers and other key employees, Profilservice has just introduced a model where you are offered co-ownership of the company. “At ProfilService, we take ownership seriously. We see it as another important tool for attracting and retaining talented profiles who can help develop ProfilService in the years to come,” says Steen Meedom. It is precisely the corporate culture, such as the one in ProfilService, that is crucial to whether Den Sociale Kapitalfond Invest sees a good investment. “If there is something we have respect for, it is precisely culture and organization in small and medium-sized companies. And we believe that there is an often overlooked factor in the potential for a company to grow,” says Lars Jannick Johansen.
Profile Service
- ProfilService was established in 1992.
- Per Jens Nielsen bought 20 percent of the shares in 2008 and the remaining in 2014.
- Per Jens Nielsen knows Steen Meedom from previous employment in the cleaning industry and contacts him for a possible partnership.
- Steen Meedom buys into the company in 2014.
- Den Sociale Kapitalfond Invest acquires 57.5 percent of the shares in January 2021.
- Den Sociale Kapitalfond Invest’s investment in ProfilService is part of a generational change, where Per Jens Nielsen is scaling down. Per Jens Nielsen will continue to own part of the company and will be chairman of the board. Steen Meedom will continue as CEO.