Cleaning & janitorial
Cleaning Bid Profit Calculator
Check what a bid returns before submitting it, with mobilisation and the full term counted.
Result
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.
Get a Free Business AuditWhat moves the number
- Production rates behind the hours, which is where bids go wrong.
- Mobilisation cost recovered across the term.
- Wage escalation over a multi-year contract.
Where this one goes wrong
Submitting a bid without modelling year two and three. A contract that works at year one wages can be loss-making by year three without an escalation clause, and by then it is contractually fixed.
Questions
About this calculator
What should be checked before submitting?
That the production rates are ones you actually achieve, that mobilisation is recovered, and that the final year still makes money at forecast wages.
Is winning on price ever right?
For a reference site in a sector you want to enter, sometimes, with the loss quantified and time-limited. As a general strategy it builds a portfolio that cannot be delivered well.
What is the most common bid error?
Optimistic production rates. Everything else in the bid depends on them and they are the least examined input.
The formula
gross profit = revenue - direct costs
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How to use this calculator
- Revenue ($). Enter your own figure; the page starts at $51,000.
- Direct labour ($). Enter your own figure; the page starts at $16,000.
- Materials and equipment ($). Enter your own figure; the page starts at $11,000.
- Other direct costs ($). 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
| Input | Value |
|---|---|
| Revenue | $51,000 |
| Direct labour | $16,000 |
| Materials and equipment | $11,000 |
| Other direct costs | $2,200 |
What comes out
| Result | Value |
|---|---|
| Gross profit main result | $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 $990.91 for every working day. Overhead still has to come out of it.
How sensitive the answer is
Holding everything else steady and changing only revenue, this is what happens to gross profit. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Revenue ($) | 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
| Result | What it is |
|---|---|
| Gross profit | The headline result. A money figure. |
| Gross margin | A percentage. |
| Total direct cost | A money figure. |
| Profit per working day | A 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.