Many cleaning professionals visit the International Custodial Advisors Network (ICAN) Ask the Experts (ATEX) page for insight. They deliver advice to help you perform your job.
Thursday’s Question
We are a small cleaning company in Utah getting ready to put in our first bid for nightly cleaning of a 2,700-square-foot office building. It has three offices, two restrooms, and a reception area.
We are trying to determine the right price to charge for this square footage. We’ve heard the smaller the building, the more you can charge per square foot, but we don’t want to go too high and lose our shot, and we don’t want to go too low and lose money. Can you help?
Thursday’s Answer
I think so, but not by giving you a figure that may be way off the mark.
I am willing to go as far as to say that this is a one man-hour job and since it is done nightly, it should be easy to keep exceptionally clean.
Beyond that, here are the things you must determine to make certain you are within range on this job pricing:
- What is your intended labor rate?
- What is your labor burden (worker’s compensation, Social Security, disability, etc.)?
- What will you spend on supplies?
- Do you need a new vacuum? To replace the one you now have?
- What will replacement equipment cost?
- What contribution will this job make toward your overhead and other business expenses, such as insurance?
- What do you want to earn for your supervision of the work?
- What is your desired profit?
Obviously, you can’t support your entire business off a five hour-a-week job; it has to carry its own weight and turn a profit. You must run some numbers and see what you must charge to keep from losing money. That is where you set your price.
Let’s play with a few numbers to see how this works. This is only an example that provides sample answers to the above questions. Use your own figures for accuracy.
1. and 2. Start with a rate of US$10 per hour for labor. A 20 percent labor burden adds $2, giving you a $12 starting point.
3. $2 per week for supplies, mops, vac bags, dust cloths, etc.
4. You have a backpack, but may need a replacement, so you should charge $4 per week towards that expense, which equates to $208 per year, allowing for a new $400 vacuum every two years. If you can make it last longer, you save.
5. $405
6. $10 per week is a safe bet, but watch insurance costs; they may kick this up higher. However, the more jobs, the less each must contribute.
7. $25 per week
8. $20 per week
This equates to a total of $121 per week for the job. Note that all the above is variable, but you must establish some figures with which to work. A small job will normally allow you to charge more per square foot, but you need to set some guidelines to see where you stand. If the job is only a break-even one, and does not contribute to the growth of the business in terms of return on investment, it is not worth the time and effort.
Now, if this is your first job and you are doing all the work and getting all the money, you may be able to drop this price a bit. Just don’t find yourself self-employed and making only $12 an hour. At that rate, the business will wear you out very quickly.
Was this of any help?
Lynn E. Krafft, ICAN/ATEX Editor
View additional Bidding and Estimating questions and answers from ICAN/ATEX here.
