How to Price Residential House Cleaning
Introduction
- Speaker: Carolyn Arano, Cleaning Business Mentor
- Topic: Pricing residential house cleaning
- Audience: Those starting or scaling their cleaning business
- Models: Covers both 1099 subcontractor and W2 employee models
Key Factors in Pricing
- Hourly Rate
- What to bill clients per hour
- Ensure profitability and scalability
- Production Rate
- Understanding how long it takes to clean specific areas
- Tools: Residential cleaning bid calculator
- Costs
- Essential to understand correct pricing
- Impact on profitability and scalability
Importance of Appropriate Pricing
- Difficult to raise prices later
- Avoid starting with extremely low prices
- Aim for a rate that supports growth and enables hiring others
Hourly vs. Flat Rate Pricing
Hourly Pricing
- Ensures payment for every hour worked
- Flexibility to accommodate unforeseen factors (extra work, dirt level)
- Example: $50/hour; 4-hour job = $200
Flat Rate Pricing
- Based on an estimated clean time
- Risk of underpayment if the job takes longer than expected
- Suitable for recurring clients where estimates are reliable
- Example: $200 flat rate; if job takes longer than estimated, earnings could decrease
Client Communication
- Inform clients upfront about potential additional charges for extra time
- Example scenarios and communication strategies
Determining Hourly Rate
- Cost Analysis
- Solo cleaners: fewer costs, mostly supplies
- Subcontractors: Fair hourly pay, expenses (supplies, gas)
- Employees: Additional costs like drive time, workman’s comp, supplies
- Profit Margin
- Ensure your rates cover all expenses and allow for desired profit
- Example pricing approach for subcontractors vs. employees
Market Research
- Understand the going rate in your area
- Avoid comparing to non-scalable cleaning jobs (solo cleaners) and undercutting yourself
- Methods: Websites, phone calls, creating spreadsheets
- Calculate an average rate from multiple companies for a realistic pricing strategy
Adjusting Hourly Rates
- Must reflect market demand and cost of living increases
- Example: Charging $70/hour in New Jersey; other areas might differ
- Ensuring the price covers marketing, office management, and other overheads
Practical Steps & Tools
- Market survey: Analyze competitors, record pricing info, calculate averages
- Intaking client details: Use specific questionnaires to estimate time accurately
- Setting Cleaning Times: Example times for different house sizes
- 1 bed, 1 bath: 3-4 hours
- 2 bed, 2 bath: 4 hours
- 3 bed, 3 bath: 6 hours
- 4 bed, 4 bath: 8 hours
- 5 bed, 5 bath: 10 hours
- Recommended Tools: Form bundles, bid calculators, intake forms
Summary
- Proper pricing is critical for a sustainable and scalable cleaning business
- Understanding costs, setting competitive rates, and flexible communication with clients can make a business profitable and efficient
- Tools and market research are indispensable for accurate pricing
Resources
- Residential cleaning bid calculator
- Employee handbooks, cleaning contracts, guidelines, checklists, and more on Carolyn’s website.
Stay tuned to the channel for more insights and tools for cleaning business success.