What Is The Best Method To Price Up Cleaning Work For My Business?
Is it best to price up for cleaning works by the hour, by the square foot, or by the visit? How should I structure my pricing and what method works best?
Over on my Maid In Business Facebook page, I often get messages from folks looking for advice, or inspiration, on what to do with their cleaning business.
Over a series of blog posts, I am going to share with you some of the questions I get, along with the answers.
I figure, if one cleaning business owner is having a particular problem, then there will be many other cleaning business owners out there sharing the same pain.
Today we speak pricing up cleaning work
“I came across your page from seeing your YouTube channel. I’m a current cleaning business owner for two years now and the problems I’m facing is not pricing well and negotiations of agreements. I don’t price per square feet nor supplies and I now know that was my loss. Is there any help on pricing and contracts that you can help with? For commercials properties, I was charging per hour when I think I should be charging per visit? So I’m in the process of negotiations with my clients and we’re not meeting eye to eye. Any advice to prevent this from happening.
Thank you for your message and for visiting my YouTube Channel, I really appreciate it
Congratulations on being a cleaning business owner and for getting through the most difficult time of a start-up
With regards to pricing and how you do it for you own business, it is up to you, and strictly speaking, so long as your business is profitable and thriving, you must be doing something right!
Some cleaning business charge by the hour, some by the visit and some the square footage – me personally, I price by the hour, in both my domestic and my commercial cleaning businesses.
I know that my main domestic cleaning competitor, in my local area (a franchise) charges by the visit… but I also find that my competitor looses a lot of clients to me because people tend to prefer the transparency of my pricing more, as they know what they are paying for 😉
When pricing up cleaning works by the hour, a simple method to use is as follows:
- Pay rate for the staff member + any employer contributions
- Add 10% for materials
- 15% to cover business overheads
Note: % to add on will vary depending on the size of your business - For more info on working-out costs in your cleaning business see the below video
The total of the above sum is the *out the door cost* (OTDC) of the cleaner to your business
- Take the OTDC total and add your sales margin to it. (this is the profit you wish to make per hour)
The highest margin I have, on a regular service, is 40% but I also have services where I charge a lower margin, for example for old folks or people on disabled benefits, but it balances out overall.
I prefer to price up cleaning work by the hour as I find the client likes to know what they will get for their money an hour, where sometimes ‘per visit’ or ‘by cleaning schedule’ can seem vague in a domestic setting
I also find it easier for invoicing, discounting and most importantly, for matching my invoices up to my employee timesheets to ensure all hours add up to my final hours total.
The final reason I like to price up cleaning work by the hour is that when started my cleaning business I was doing all the cleaning myself, so now, when I go to a site, be it a home or office, I know how long it will take to do the clean the way I would expect it to be done, and in the way that I train my cleaners to clean
To price up cleaning works by square footage it would be a similar affair. You would need to know sizes of the building and also what you/your cleaner are capable of cleaning and in what time frames, you would also need to know what size of areas wouldn’t be cleaned (eg cupboards, stairwells etc). After that the process is the same – you need to add on your % for cleaning products and/or consumables and you need to add your % to cover business overheads, and last but not least, your profit % you want to make per building.
Take a look at these articles from CleanLink.com which gives more details and questions to consider on how to price by square foot and the article by smallbusiness.chrome.com which has a similar method.
To price up cleaning work by the visit, it is again the same as above but taking into account how long a visit will take and what tasks are expected etc. You need to allow yourself enough time in that visit so that you are either not running at a loss, or killing yourself trying to clean as fast as possible to make a profit. Eek!
Take a look at this post from care.com about different ways to price up cleaning work for some added inspiration (American article)
Pricing by visit/schedule does allow some businesses to add in extra margin, and this has been my experience when gathering information on my competitor I mentioned earlier – their quotes don’t specify cleaning time, but as an example, say, I could charge £38 for a 3 hour clean, they would charge £57 for ‘a visit’, based on the clients same expectations and wants – their visit could take three hours or it might take one. Who knows?!
I know in the USA there is a thing for pricing by square footage as I see it a lot in the groups I’m in, on here on Facebook and on Google + etc, but personally, I think it’s what the business owner finds best and what is the most simple, yet effective way, to make money.
I think sometimes people think business always needs to be super-duper complicated. It doesn’t. I like the simple things in life, so I go for the simplest ways to run my cleaning business and price up cleaning work
I hope this has been of some help to you but if you do have any further questions or comments, please holler at me.
Take a look at the below video on pricing structures for your cleaning business to help you to work out your business costs
So groovers, what do you think of today’s MIB Q&A? How do you price up cleaning works for your business? Share in the comments below and let’s swap best practice.
Do you have a question you’d like me to answer about your cleaning business? Contact me and I’d be happy to help
Until next time,
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