There are a few things you need to consider before starting a cleaning business, from market research to running a marketing campaign. Setting the price for your business is one of the essential things to add to the process. Knowing how much you need to charge for your service, whether for house cleaning or any other cleaning service, is a must.
So you’ve finally got your house cleaning business running, but you’re unsure how much you have to charge for the service. You’ve come to the right place, as today we will cover some tips to set the price for house cleaning that is profitable for your business and attractive enough for your ideal customers to buy from you.
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So, what do you need to consider before setting up the price for your service? How much to charge for house cleaning? Here we go!
What You Need to Consider Before Setting Up the Price for House Cleaning
Deciding how to charge for your cleaning service will be easier if you already know your ideal target market. Whether you want to get individual clients or corporations, setting the price when you start a cleaning business is important.
In this section, we will outline the essential items to consider before setting up the price for your cleaning service. So, what do you need to consider to determine how much you have to charge for the house cleaning service? Let’s find out!
Calculate the Labor Cost
When you run a cleaning business, you mainly rely on manpower to maintain your business. And that’s the reason why calculating the labor cost is the first thing you need to consider before setting the price for your house cleaning service.
Even if you just started and you’re self-employed as a house cleaner, you first need to ensure that you can afford to pay yourself for your time and dedication to your business.
The easiest way to calculate the labor cost is to determine the hourly rate for your workers. For instance, the average hourly rate for a house cleaner in the UK is around £10 to £20. If you’re in the US, house cleaners typically make around $11 to $15 per hour.
After setting up the hourly rate, it’s time to calculate the average time spent on a house cleaning project. Once you have everything measured, it’ll be easier to move to the next stage of setting the price for your cleaning business!
Calculate the Operational Cost
Next, you also need to consider how much the operational cost will be. There are some ways you can do to cut the operational cost of your cleaning business. However, essentially there are some items that you need to add to your operational expenses, which include:
- Cleaning supplies and tools
- Transportation cost
- Marketing and sales expenses
Are you going to supply all the cleaning products to clean your client’s house? Or will you rely on the client’s supplies to cut operational costs and make your rate more competitive than your competitors? What do you need to consider for the transportation?
It’s up to you to determine the best way to calculate your operational cost, but it’s important to be more vigilant about the items to be included so you can still make a profit out of your house cleaning business.
Calculate in Taxes and Insurance
Now that you know how much it should cover the labor cost and your typical operational expense, don’t forget to include the necessary tax and insurance. In the UK, you will need to pay income tax at 20% for an annual income of over £12,500.
Whether you’re self-employed or hiring employees for your house cleaning business, you always need insurance to protect yourself and your business from all the potential risks in your daily activities.
For businesses in the cleaning industry, you need at least public liability insurance if you’re self-employed. That way, you’ll be covered for any potential injury or property damage caused by your professional services. If you hire employees for your business, you must include employer liability insurance to protect your employees from any possible accident that could happen during their working hours.
Other than that, you may also want to consider covering yourself with some other types of insurance to protect your cleaning business, including:
- Portable equipment insurance, as you will also rely on your cleaning tools to do the service offered to your clients. It’s important to cover your cleaning business with business equipment insurance so that you’ll get covered for any repairs or replacements that can potentially delay your operational activities.
- Legal expenses insurance, as you’ll never know what can possibly happen when you’re the owner of a business. It is recommended to have legal expenses insurance in case you need to pay any legal service on behalf of your cleaning business.
Add the Profit to It
Based on the report published by the British Cleaning Council (BCC), the cleaning industry makes to one of the top ten industries in the UK. Around 5% of the UK’s entire workforce work in the industry, and a study shows that approximately 60% of people under 35 in London hire house cleaners.
Needless to say, the market is significant if you’re planning to run a house cleaning business. Once you know your ideal market, it’s time to calculate the profit you want to earn from your service. Calculate your potential net profit by adding a markup percentage based on the combined number you get from the above categories.
Typically, you can add around 10 to 40% profit, depending on your business size.
3 Ways to Charge for House Cleaning
Now that you know the average cost you spend in running your cleaning business, it’s time to identify how you want to charge your clients for your house cleaning service.
Typically, the big factor to include when determining your home cleaning pricing is the location where you run your business and the living cost around it. It is easier to decide how many percentages you want for the profit once you calculate these factors.
It is also important to inspect other factors, such as the level of cleanliness in your client’s house or the amount of time you will spend cleaning the area. Once you put them into consideration, there are three ways you can implement to charge your client for your house cleaning service. What are those?
Charge per square foot of the house
Determining the price based on the square foot of the house is an ideal way to charge your client if you’re open to cleaning some bigger homes that may take a while for deep house cleaning.
The easiest way to set the price is by measuring your home size and the approximate time spent cleaning it. Multiply it by the average wage in the area, and you can determine the best price to quote your clients for your house cleaning service.
InvoiceBerry is a software suitable for cleaning businesses, making it easier for you to send quotations or invoices to streamline the bookkeeping process for your cleaning business. Not only will it make it easier to manage your business’s finance, but you can also connect the payment feature with platforms like Paypal, Stripe, or Square to make it easier for your clients to pay you in almost no time.
Charge an hourly rate
Depending on where you’re based, many house cleaners use this method to charge their clients for their services. Self-employed house cleaners usually charge around £10 to £20 for their hourly rate, and it can go up to £30 per hour if they’re based in London.
If you run a cleaning agency, you can also expect to charge slightly higher than the typical hourly rate for cleaners in the UK. Create an invoice template for house cleaners to simplify the payment process for your clients and enhance brand awareness for your cleaning business.
Charge per number of room
Another alternative is to charge by the number of rooms for your house cleaning service. You can set the standard price for house cleaning service on a studio, a 2-bedroom house, and more.
Typically, house cleaners set their rate starting from £60 for a studio, and it goes up from there. You can create a website for your cleaning business, and automate the booking and payment process through the platform to create a seamless customer experience for your potential clients.
Showcasing how much you charge for house cleaning on your website also helps you select the ideal target market for your cleaning business, so you don’t have to go back and forth negotiating the rate for your service.
Conclusions
Setting the price for your house cleaning service shouldn’t be too difficult if you know which item to calculate in the rate you offer for your clients. The most important thing is to determine the hourly rate for you or your workers and add the operational cost along with the tax and insurance to come up with the price for your house cleaning service.
Once you set the price, you can streamline your cleaning business’s bookkeeping and invoicing system with InvoiceBerry. So, are you ready?