Determining how to price commercial cleaning jobs is one of the most difficult business challenges. Here’s how you can simplify the process.
One of the more challenging aspects of running a janitorial business is figuring out how to price commercial cleaning jobs. If your prices are too low, you risk losing money on a job. If your prices are too high, it may be hard to find clients.
Yet, you have to meet payroll, pay bills, service and update equipment, and cover numerous other expenses. Plus, you need to make a profit. How do you find that middle ground? Where can you find out how to price commercial cleaning jobs in a way that works for you and your clients?
The truth is, there are several ways you can approach this. For example, some commercial cleaners may position themselves for a high-end clientele who are willing to pay a premium. These might include exclusive resorts, luxury auto dealers, or similar operations.
Others may run on the idea that profit comes from volume, while another commercial cleaning company may prefer to find profits through a minimalist approach with expenses. There’s no one “right” way to run your business or make a profit. There are, however, some strategies for pricing commercial cleaning jobs that can set you up for greater profits.
Keep up with your customers, contracts, prospects, and bids. Learn more today with a discovery call and find out how to make your business efforts more efficient, cost effective, and better for everyone!
Find out how to price commercial cleaning jobs to guarantee profits
First, it’s important to understand that pricing varies considerably. Commercial cleaners in New York City will likely charge more than those in Lewisburg, WV simply because the cost of living differs. Likewise, a cleaner specializing in, say, marble floors, may charge a higher rate than a company that does more general work.
Second, you aren’t entirely on your own when setting your rates. The ISSA time and task standards offer an excellent starting point for determining how to price commercial cleaning jobs. In fact, this standard gives you consistency from bid to bid, and numerous commercial cleaners find the ISSA Templates to be an ideal way to streamline bidding and remain competitive. You put in the information, such as square footage and the task (mopping, cleaning surfaces, etc.), and the standards will give you the approximate time it takes to do the job.
The third point is that you can take a lot of the work out of determining how to price commercial cleaning jobs by using bidding software. In the case of Janitorial Manager’s bidding calculator, for example, you plug in your numbers, and you can accurately determine your expenses and margins and compare different numbers to get a bid that works for you.
Now let’s look more specifically at profits. All of the above points will help with consistency, as well as the actual bidding process. However, that doesn’t necessarily equate to maximum profits.
Begin with accurate details. Don’t guess at things like building square footage, restroom fixtures, types of flooring, foot traffic, number and size of windows, and so on. Do a walkthrough with your prospect and discuss exactly what their expectations are, including frequency, time of day, and any add-ons to your typical services.
Understand your expenses. This includes employee wages and supplies, but it also should include the “hidden” costs, such as employment taxes, insurance, and any equipment rentals you may need. Be sure to include a profit margin. Once you have accurate details about the job, as well as a good understanding of your expenses, you can figure out your quote. Again, all this is much easier with a bidding calculator.
Explain your numbers. When you explain your numbers to a client or prospect, you’re pulling back the curtain and showing them what goes on “backstage.” What does this have to do with figuring out how to price commercial cleaning jobs? Most likely, prospects will want to negotiate the price with you. You can decide whether you want to do that or not, but you can use your numbers as a bargaining chip.
Of course, you don’t need to give away everything. Sometimes just explaining the cost of supplies or why you pay your employees well (fair wages or insurance, for example) is enough for people to understand and appreciate what you charge. This is also an opportunity to market your business by pointing out the quality of products you use (giving the client a better clean), the low employee turnover rate (giving the client a more experienced team), excellent customer reviews, or whatever makes your business stand out.
More ways to increase profits
You don’t need to justify your pricing, necessarily. It’s just that most people don’t understand what goes into the bid. So you’re educating them and marketing your business at the same time, leading to a greater chance that they will sign on with you.
The price you charge is one of several factors in your profit margin. Higher profits also come from good organization, efficient planning, regular equipment maintenance, smart supply ordering, and good teams.
One way to improve your organization, as well as gather accurate data, is to use a tool like Janitorial Manager’s Scan4Clean. Scan4Clean is a QR code system that provides down-to-the-minute details of the tasks your team handles not just in a location, but even within sections and individual rooms of any facility.
This powerful tool will help you increase profits while making your overall operations easier and smoother.
From bidding to maintenance to employee schedules, Janitorial Manager can help your organize function more professionally. Schedule a free call with Janitorial Manager and make your work easier and more profitable.