cost structure of a new cleaning company (what should your cleaning business be doing?)

Cost structure of a new cleaning company

Cost Structure Analysis and Forecasting (Based on assumption your cleaning company is grossing $25/hour):

Payroll: 40%

Overhead/Business Related Costs: 10% (website, insurance, marketing, etc)

Supplies/Equipment: 8%

Payroll Taxes: 7.65%

Sales Incentive Program: 5%

Managerial/Administrative Fees: 5%

Misc. Costs: 2% (Maybe this should also go under overhead…this way you will have a little left over for state unemployment tax, raises, savings, etc)

Total costs of service = 77.65%

Gross Profit Margin =22.35%

*This is just a very safe estimate… and you should feel free to change this Budget sheet up as we move forward. I don’t really think that supplies and equipment will really take up that much of the budget and I think the sales incentive could possibly even be higher to help motivate your employees to get new customers. I also see some of the overhead possibly shrinking as the business grows, but then again maybe as your company grows you will be more apt to use fringe benefits of a solid overhead budget (drinks and dinner, small gifts, etc…). You could also always re-visit the budget and use that money to hire someone to manage it full time and earn passive income (where a day at the office consists of you collecting your checks each month…)

New Cleaning Company Scenario (see the table below for specifics): By cold calling, word of mouth, and direct mail you end up contracting totaling 40 hours of work each week (20 bi-weekly contracts averaging 4 hours each). All you need to do is hire 2 temporary employees to do the work…


feel free to check out my green cleaning company in Ann Arbor...


Hopefully this will give you a better idea of what kinds of costs to expect as you start your new company.

Scenario for Cleaning Company

 
Weekly
Monthly
Yearly
Receivable
1000
4000
52000
 
 
 
 
Payroll
400
1600
20800
Overhead
100
400
5200
Supplies/Equipment
80
320
4160
Taxes
76.50
306
3978
Sales Incentives
50
200
2600
Managerial Fees
50
200
2600
Misc.
20
80
1040
Gross Profit
223.50
894
11622

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Comments 1 comment

cooper cook 4 years ago

Now what type of cleaning companies does this entail for how the pay scale is set up? http://www.jonesboysonline.com/services.html

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