How to Determine the Profit Margin for Your Cleaning Business

💰Profit margins are the difference between gross sales and business expenses, expressed as a percentage.

📊To determine your profit margin, calculate your annual gross sales and subtract your expenses, including credit card fees and labor costs.

💻Using invoicing and payment software like Project To Payment can help you track your gross sales and credit card fees efficiently.

🔢Labor costs should be factored in when hiring employees for your cleaning business, but they can be offset by increased gross sales.

💡A healthy profit margin for a cleaning business is typically around 30% or higher, but it can vary based on business model and expenses.

What are profit margins?

—Profit margins are the percentage difference between a business's gross sales and expenses.

How do I calculate my profit margin?

—To calculate your profit margin, subtract your annual expenses from your gross sales and express the result as a percentage.

What expenses should I consider for my cleaning business?

—Some common expenses for a cleaning business include insurance, software costs, supplies, labor costs, and credit card fees.

Should I factor in labor costs for my cleaning business?

—If you hire employees for your cleaning business, you should include their wages in your expenses. However, increased gross sales can offset these costs.

What is considered a healthy profit margin for a cleaning business?

—A healthy profit margin for a cleaning business is typically around 30% or higher, but it can vary based on the business model and expenses involved.

00:00This video discusses how to determine the profit margin for a cleaning business.

08:53The first cleaning business model discussed is a solo cleaning business, where the owner does all the cleaning work.

10:46The second cleaning business model discussed is hiring employees for the cleaning work.

11:57The video concludes by encouraging viewers to have confidence in building their dream cleaning business.