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Cleaning & janitorial

Cleaning Contract Profit Calculator

See what a cleaning contract returns across its term after every delivery cost.

Your numbers

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Result

Gross profit $21,800
Gross margin 42.7%
Total direct cost $29,200
Profit per working day $990.91
That is $21,800 at a 42.7% margin, about $990.91 for every working day. Overhead still has to come out of it.

Gross profit is what is left after the cost of doing the job. Overhead comes out of that: the building, the office wages, the vans, insurance, software and advertising. A healthy gross margin still loses money if overhead is larger.

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What moves the number

  • Hours actually delivered against hours priced.
  • Scope creep absorbed over the term.
  • Wage increases across a fixed-price contract.

Where this one goes wrong

Reviewing contract profitability only at renewal. By then the erosion has run for the full term, and the renewal conversation starts from a price that was already too low.

Questions

About this calculator

When should a contract be reviewed?

A few months in, then annually. The early review catches a mispriced bid while there is still contract term left to fix it.

What causes contract profit to fall?

Absorbed extras, wage increases without escalation, and consumable usage above the allowance. All three are gradual and none announces itself.

How do I raise price on an existing contract?

With notice, evidence and preferably an escalation clause agreed at the outset. Retrospective increases without one are a difficult conversation.

How useful was this calculator?

Not rated yet. Yours would be the first.

The formula

gross profit = revenue - direct costs

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How to use this calculator

  1. Revenue ($). Enter your own figure; the page starts at $51,000.
  2. Direct labour ($). Enter your own figure; the page starts at $16,000.
  3. Materials and equipment ($). Enter your own figure; the page starts at $11,000.
  4. Other direct costs ($). Enter your own figure; the page starts at $2,200.

The result updates as you type, so you can try a figure, see what it does to gross profit, and change it back. Nothing you enter is sent anywhere or saved.

A worked example

These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.

What goes in

InputValue
Revenue$51,000
Direct labour$16,000
Materials and equipment$11,000
Other direct costs$2,200

What comes out

ResultValue
Gross profit main result$21,800
Gross margin42.7%
Total direct cost$29,200
Profit per working day$990.91

That is $21,800 at a 42.7% margin, about $990.91 for every working day. Overhead still has to come out of it.

How sensitive the answer is

Holding everything else steady and changing only revenue, this is what happens to gross profit. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.

Revenue ($)Gross profit
$25,500 -$3,700
$38,250 $9,050
$51,000 example above $21,800
$76,500 $47,300
$102,000 $72,800

Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.

What each figure means

Revenue ($)
A money amount, starting at $51,000.
Direct labour ($)
A money amount, starting at $16,000.
Materials and equipment ($)
A money amount, starting at $11,000.
Other direct costs ($)
A money amount, starting at $2,200.

What the results tell you

ResultWhat it is
Gross profitThe headline result. A money figure.
Gross marginA percentage.
Total direct costA money figure.
Profit per working dayA money figure.

Time is the variable that bites

Pricing that works out on paper fails when the job takes longer than quoted. First cleans, heavily soiled sites and access problems all run over, so it is worth pricing the first visit separately from the recurring one.

Estimating is the easy part

The jobs you never hear about cost more than the ones you mis-measure. BDEVY builds the marketing, systems and automation that bring them in.