Understanding cleaning business profit margins
A healthy-looking selling price can hide an unprofitable job. Use consistent cost definitions and compare like with like.
Start with the right revenue
Use the customer price before tax collected for authorities. Refunds or discounts reduce revenue. Keep processing fees as an expense rather than silently ignoring them.
Separate margin from markup
Margin is profit divided by revenue. Markup is profit divided by cost. With $80 cost and $100 revenue, profit is $20, margin is 20%, and markup is 25%.
Job profit is not net company profit
This tool reports profit after the costs you include. Formal gross profit usually excludes some overhead. Company-wide net income may include additional rent, admin salaries, financing costs, depreciation, and tax.
Review losses openly
Zero revenue means margin is undefined, even when a loss can be calculated. A negative result is a prompt to inspect the time estimate, customer price, and cost inputs.
Use scenarios, then verify
Try higher labor costs or longer job times to see the effect on profit. These are projections, not forecasts. Replace estimates with actual job results after completing the work.