Price your cleaning services too high, and you lose your client.
Don’t charge enough… and you lose your own money. (I’ve seen some cleaning companies that do this and end up working for free.)
Good news? There is a perfect balance.
This article will show you how to find your “pricing sweet spot” so you will always make a healthy profit on your cleaning services – without turning away good clients.
1. Record Your Average Cleaning Times
Time is money.
That means, your prices should be based on your average cleaning times. (That doesn’t mean you should slack or slow down to “drag out the clock”).
You need to find your “per room” average:
Grab a timer and clock yourself.
Clean your house. If that’s not enough, ask your family and friends if you can clean their houses (chances are they’ll be happy for the free help)!
Time yourself in each room:
- Living areas (dens, family rooms, etc.)
Establish a baseline average for each room. This way, when your clients tell you how many rooms they have, you can give an accurate estimate for cleaning times.
You will also be able to quote a more accurate price.
Example cleaning times for a 2 bedroom / 2 bathroom single-story house:
Bedrooms: 25 minutes x 2
Bathrooms: 35 minutes x 2
Living area: 20
Final inspection: 10
Total: 3 hours for a basic cleaning
When you establish your per room averages and you can hit that average every time, you are ready to decide on your optimal pricing model.
2. Decide on Your Pricing Model
These are the three most popular ways to charge for your cleaning services:
I recommend starting with this pricing model, as it allows you to focus on quality and VALUE.
This is the perfect model for beginners and people who are still working on their “average cleaning times.”
That said, you never want to drag out the clock when you are cleaning hourly. Your goal should be to move as efficiently as possible. Client satisfaction is key to your reputation and the success of your business.
Example: $30 per hour for basic cleaning.
Flat Rate / Per Room
A more advanced way to price. You must account for areas that might take you longer to clean (i.e. stairs or hard-to-get stains).
Once you know how many rooms are at the property, you can make an estimate based on your per room averages.
Flate Rates can be easier to sell to clients (because they know what they have to pay upfront), but if you don’t know the house very well – or don’t clean it very often – then this model can cost you. Monthly clients, or deep cleans make it harder to give accurate rates, since you don’t know the state of the property.
Make sure you ask all the right questions before giving out a flat rate estimate.
Example: $150 for one basic cleaning.
This model works great if you clean homes of a similar size (i.e. you sell a lot of work in a neighborhood with “cookie cutter” houses).
Why? Because you know exactly how long it takes you to clean, and the time doesn’t really change week to week (unlike irregular deep cleanings, or when you work on extra large properties).
From what I’ve seen, this model is most profitable (and easy to sell) to houses between the 2000-3000 square foot range that sign up for weekly services.
Example: $30 for every 500 square feet.
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3. Price Your Cleaning Services for Profit
OK. Let’s talk numbers.
Most cleaning companies base their prices on the market average. They simply look at what their competitors are charging… and charge less.
DON’T DO THIS.
You will end up working for pennies – or robbing yourself blind. Your prices need to be based on two things:
What are Your Overheads?
Before you put a dollar-value on your services, you need to figure out what it costs to run your business.
- Cost of supplies
- Employee wages
- Drive time and Fuel
Always factor in your employees – even if you don’t have any. This will help you when you grow.
Also, it’s a good idea to remind yourself that you are an employee of your business. Even the CEO of Amazon is an employee of his own business.
Example: Let’s say you have 2 employees ($22 per hour), with 15 minutes of drive time ($3 to get to the property) and your supplies amount to $3 per hour.
That means you need to charge at least $28 per hour… just to break even!
Base Your Profits on Your Value
What are Your Clients Willing to Pay?
This is equal parts your market and the quality of your service. If you’re going after low-income houses, it’s probably a bad idea to sell “elite, high quality cleaning services with an attention to detail.”
To decide on how much profit you will make per service: price according to what your clients are willing to pay.
For this reason, most cleaning companies find that they can make more profit by going after mid-to-high income clients.
Example Pricing for Basic Cleaning:
Let’s combine all of our examples from early.
Here, we will say it costs you $28 per hour to clean, due to overhead.
For a 2 bed / 2 bath house, it takes you 3 hours to clean.
You think you can safely make $5 profit per hour with this client.
For this client, your hourly rate will look like this: $28 + 5 = $33 per hour
Flat Rate: $33 x 3 hours = $99
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Bonus: One Easy (and Safe) Way to Test Your Prices
The truth is, the example rates above are actually on the low end.
Most successful cleaning companies will not go out to any client’s property for less than ~$150, because it takes time to drive out there… time they could use to clean more profitable clients’ houses.
Sometimes, you will price too low. It happens to all of us. That’s why it’s critical to test your prices, especially if you are just starting out.
Testing and increasing your prices is a scary task… But there is one way to do it that will help you overcome your fears – and sell more work.
How to Test Your Prices
Let’s say you have 50 clients.
You make a “decent” profit on most of them… but about 10 of those clients make you almost $0.
That’s a blessing in disguise. What happens if you lose those clients? Nothing! You don’t lose any money!
So, take your 5% worst-performing clients, and test a price increase on them first.
You will get to hear their objections and learn how to deal with them before you try increasing your prices on clients who actually matter to your company.
The worst that can happen is you lose some unprofitable clients.
Price your cleaning services correctly, you’ll see a sharp increase in your profits.
Remember: time is money.
When you know how long it takes you to clean a certain area – whether that’s square feet, or by room – then you can accurately gauge how much to charge for every job.
I hope this helps you grow faster and more profitable =)
Patrick Hoffman is the lead marketing writer for Service Autopilot. He writes about growing healthier Service Businesses - primarily for the Lawn Care, Landscaping, and Cleaning Industries. When he's not writing, he's probably reading: books on marketing, self-improvement, or science fiction. Contact Patrick: firstname.lastname@example.org