50% doesn't seem too far off, really. If your paying your employees $10 an hour, after factoring in workmans comp and employment taxes it could be $14 or more an hour. If your charging the client around $35 an hour (and you factor in paying for employee drive time), 50% is about right. Your labor cost is going to be your biggest expense, and should account for around half of your revenue, depending on how much you are charging. You might want to look into the Speed Cleaning DVD by Jeff Campbell. It will cut your labor costs by quite a bit if implemented correctly. Also, try catering toward high end clients with household incomes above $100,000....you can charge more this way and your labor will be a lower % of your revenue. A friend of mine that owns a cleaning company does a lot of Groupon offers and penny saver ads...lets just say his labor costs are about 60% or more of his revenue, and hes not doing as well as he should be. Target the demographic that can afford to pay more then $35 an hour for cleaning services. Little things make a big difference as well....like using extension cords for vacuuming, and having employees knot the extension cord to the vacuum cord so it doesn't become unplugged accidently. You can also specialize in higher margin categories of cleaning like commercial floor cleaning. Its not uncommon to charge $50 or more for commercial floor cleaning and buffing services, but you also have to make a heft investment in industrial cleaning equipment too.
Last edited by MajesticMaids; 03-26-2013 at 03:26 PM.