Cleaning profit margins

The IRS reports what one-owner businesses filing Schedule C earn, by sector. Cleaning falls under Administrative and support services. For tax year 2023, 3,118,914 returns reported $114.4 billion in receipts, $17.9 billion in cost of sales and $24.2 billion in net income less deficit (the table gives thousands of dollars):

The owner's own draw is not an expense on a Schedule C, so that net margin is mostly the owner's wage, not profit on top of it.

House cleaning is almost all labor. Supplies are a small share; drive time and the first visit to a dirty home are the margin killers.

For a worked example, our house cleaning cost calculator puts standard clean, 2,000 sq ft home at $180 to $300 a visit, typical $240, and treats about 65% of that as labor. On the typical price, that is about $156 of labor and $84 of materials, equipment and everything else, before your overhead and profit.

• First cleans priced like recurring cleans
• Drive time between homes
• Add-ons done free to keep the customer
• Cancellations with no fee
• Supplies bought at retail

Ways cleaning companies raise margin: price first cleans as deep cleans; fill one neighborhood before adding the next; charge a late cancellation fee; sell add-ons like ovens and fridges on the booking.

The typical national prices from our sourced calculators are a check on whether your prices leave room for margin:

Work out the margin on each line of your menu, not just the big jobs. The usual cleaning menu: standard clean, 2,000 sq ft home; weekly or every-two-weeks clean; monthly clean; deep clean, 2,000 sq ft home; move-out clean, 2,000 sq ft home; post-construction clean; holiday or event clean; inside the oven; inside the fridge; interior windows; carpet steam cleaning; laundry and linens.

Overhead comes out of the margin before profit. In cleaning it includes general liability insurance, which Insureon's customers who are house cleaners pay an average of $51 a month for; commercial auto at $268 a month on the same figures.

Put one recent cleaning job into the calculator above, or switch it to "My margin for the year" to set your year next to the IRS benchmark. A 50% markup is a 33% margin; the markup calculator shows the rest.