Built by commercial cleaners. For commercial cleaners.
How to Price Commercial Cleaning Contracts Without Losing Money
Winning a commercial cleaning contract is exciting. Finding out six months later that you're losing money isn't. Learn how to calculate labor, supplies, overhead, and profit so you know exactly what you're charging—and why.
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Stop Pricing Against Your Competition. Start Pricing for Profit.
One of the biggest mistakes commercial cleaning companies make is worrying about what their competitors are charging before they understand their own costs. Your competitors don't pay your employees, your insurance, or your overhead. Your price needs to support your business—not someone else's.
Know Your Costs
Understand exactly what it costs to service the building.
Know Your Margin
Decide how much profit the contract needs to generate.
Know Your Numbers
Track actual performance so your profit doesn't disappear after the contract starts.
The Commercial Cleaning Pricing Formula
- 1
Labor hours
Realistic hours to clean the building each month.
- 2
Fully loaded labor cost
Hours × wage × (1 + payroll burden).
- 3
Supplies & equipment
Direct costs for this account.
- 4
Overhead
Share of business costs not already counted.
- 5
Total operating cost
Labor + supplies + overhead.
- 6
Target profit margin
The share of the price you keep as profit.
- 7
Selling price
Total cost ÷ (1 − margin).
Selling Price = Total Operating Cost ÷ (1 − Target Profit Margin)
Write the margin as a decimal. A 20% margin means dividing by 0.80.
Margin vs. markup: margin is the share of the selling price you keep as profit. Markup is a percentage added on top of cost. They are not the same number — see the side-by-side below.
Let's Price a Realistic Commercial Cleaning Contract
Building assumptions
- 25,000 sq. ft. office building
- Five nights per week
- Five labor hours per cleaning
- $20/hr wage
- 25% payroll burden
- $250/month supplies & equipment
- Overhead: 15% of direct costs
- Target operating margin: 20%
Cost breakdown
- Monthly labor hours (5 × 5 × 52 ÷ 12)108.33 hrs
- Loaded labor ($20 × 1.25 = $25/hr)$2,708.33
- Supplies & equipment$250.00
- Direct operating costs$2,958.33
- Overhead (15% of direct)$443.75
- Total monthly operating cost$3,402.08
Monthly selling price ($3,402.08 ÷ 0.80)
$4,252.60
Monthly operating profit: $850.52 · Annual contract value: $51,031.25
Illustrative estimates only — not a market rate or a guaranteed profitable bid. Actual pricing depends on building complexity, local labor rates, staffing, equipment, supervision, scope and customer expectations.
Your Employee's Hourly Wage Is Not Your Actual Labor Cost
Fully loaded labor cost is everything you pay for each hour worked, not just the wage.
- Hourly wages
- Employer payroll taxes
- Workers' compensation
- Applicable benefits
- Paid time off where applicable
- Other employer labor expenses
A $20/hr employee with a 25% payroll burden costs about $25 per paid hour, before any expenses not included in that burden.
Use your company's actual burden rate, and don't count the same expense again in overhead.
Don't Forget the Costs That Don't Show Up on a Timecard
Direct Contract Expenses
- Cleaning chemicals
- Paper products when included in scope
- Trash liners
- Equipment usage
- Replacement supplies
- Site-specific expenses
Business Overhead
- Management and supervision not already allocated directly
- Insurance
- Office and administrative expenses
- Software
- Recruiting and training
- General business expenses
Put each cost in one category and keep it there, so nothing is counted twice.
A 20% Markup Is Not a 20% Profit Margin
Same $4,000 operating cost, two very different results.
20% markup
$4,000 × 1.20
$4,800
Profit $800 · Actual margin 16.67%
20% profit margin
$4,000 ÷ 0.80
$5,000
Profit $1,000 · Actual margin 20%
If you're trying to achieve a 20% margin but you're simply adding 20% to your costs, you're not making the margin you think you are.
Your Contract Needs to Be Profitable Next Year, Too
On a multi-year fixed-price contract, costs can rise while your price stays the same.
- Wage increases
- Payroll burden changes
- Supplies inflation
- Increased service frequency
- Changes to the scope of work
- Employee turnover
- Additional supervision
- Requests outside the agreement
Example: price fixed at $4,252.60/month, costs rise 5% a year
| Year | Monthly cost | Monthly profit | Margin |
|---|---|---|---|
| 1 | $3,402.08 | $850.52 | 20.0% |
| 2 | $3,572.19 | $680.42 | 16.0% |
| 3 | $3,750.80 | $501.81 | 11.8% |
Hypothetical assumptions.
Before you sign, review escalation clauses, scope-change provisions and renewal terms. In most fixed-price contracts you can't change the price on your own during the term, so plan for cost increases up front.
The Bid Isn't Finished When You Win the Contract
Compare what you estimated with what actually happens on the account.
- Estimated vs. actual labor hours
- Scheduled vs. worked shifts
- Supply usage
- Additional service requests
- Quality issues that create rework
- Actual operating costs
- Contract-level profitability
Cinch's scheduling and clock-in logs help you see the shifts you planned and the hours your team actually worked, so you can compare them with your bid.
Price Smarter. Build the Proposal. Manage the Account.
Calculate Your Bid
Organize the numbers behind your bid so you can build your pricing around labor, expenses, and your target profit.
Build a Professional Proposal
Take your pricing and turn it into a professional proposal that clearly communicates the services you're offering.
Track the Work After You Win
Keep your accounts, employees, schedules, and worked hours organized after the contract begins.
Before You Submit Your Next Commercial Cleaning Price
- Confirm the complete scope of work
- Verify cleaning frequency
- Estimate realistic labor hours
- Calculate fully loaded labor costs
- Include supplies and equipment
- Account for overhead
- Apply your target profit margin correctly
- Consider long-term cost increases
- Confirm exclusions and special services
- Review the final proposal before sending it
Pricing Advice From Someone Who Has Actually Run the Contracts
Cinch was built from firsthand experience operating a commercial cleaning company. With more than 20 years in the industry, Edwin understands that winning contracts is only half the battle. The real challenge is pricing them correctly, staffing them efficiently, and keeping them profitable.
- 20+ years of industry experience
- Founder of an eight-figure commercial cleaning company (iPro)
- 4× Inc. 5000 honoree through iPro
Commercial Cleaning Pricing Questions Answered
Stop Guessing Your Prices. Start Knowing Your Numbers.
Every commercial cleaning contract should have a price you can explain and a margin you can manage. See how Cinch helps you build more informed bids and professional proposals.
7-day free trial • 10 users included • $89/month
Credit card required. See trial and billing terms.