What is a typical profit margin for a cleaning company?
A common planning target for a cleaning company’s profit margin is a gross margin of about 35% to 45% and a net margin of about 10% to 20%, once the owner is paid a fair wage for the work they do. Companies that skip the owner’s pay report higher net margins on paper, and companies that underprice report lower ones, which is why quoted figures vary so much.
There is no official survey of cleaning business profit margins, so be wary of any page that states one to the decimal. What exists is cost data. The 2022 Economic Census (sector 56 basic table, file EC2256BASIC) reports receipts and payroll for every employer firm in janitorial services (NAICS 561720): $72.6 billion in receipts and $31.4 billion in payroll, so payroll takes 43.3 cents of every dollar before payroll taxes, workers’ compensation, supplies, vehicles, insurance or anything else. For carpet and upholstery cleaning (561740) it is 37.6 cents.
Payroll at 43% of revenue, plus roughly 10% more for the costs that ride on payroll and for supplies, puts a typical employer cleaning company near a 45% gross margin before overhead. Overhead (vehicles, insurance, software, office, marketing, management) then takes most of the rest. In our experience, well-run companies keep 10% to 20%, many keep much less, and the ones that never time their jobs can keep nothing.
The rest of this guide defines the two margins, works through a hypothetical month, compares residential with commercial, and lists what moves the number. For how to set prices in the first place, start with the house cleaning pricing guide; the example here uses its assumptions.
Gross margin vs net margin: what is the difference?
Gross margin is what is left after the direct cost of doing the cleaning: cleaner pay, the payroll costs on that pay, and supplies. Net margin is what is left after overhead too: insurance, vehicles, software, phone, marketing, office help and the owner’s time running the business. Gross margin tells you whether your prices work. Net margin tells you whether your business works.
Using one $150 standard clean from our worked model (hypothetical numbers):
| Line | Amount | Share of price |
|---|---|---|
| Price of a 3 bedroom, 2 bathroom clean (3.5 cleaner-hours) | $150.00 | 100% |
| Cleaner pay, $20 × 3.5 hours | − $70.00 | 46.7% |
| Payroll taxes, workers’ compensation, paid drive time (25% of pay) | − $17.50 | 11.7% |
| Supplies | − $10.00 | 6.7% |
| Gross profit | $52.50 | 35.0% gross margin |
| Overhead (insurance, vehicle, software, marketing, admin) | − $30.00 | 20.0% |
| Net profit | $22.50 | 15.0% net margin |
Three things to notice. Direct labor is the whole story: pay and the costs on top of it are 58% of the price, which is close to the 43% payroll ratio in the Census data once you add the payroll costs the Census does not count. Supplies are small. And the net margin is set by overhead discipline, because the gross margin was fixed the moment you set the price and the wage.
The $20 wage is a modeling choice. The median for maids and housekeeping cleaners was $17.07 an hour in May 2025 according to the Bureau of Labor Statistics; paying more than the median is normal for residential companies that want cleaners to stay.
What does the data say about cleaning business revenue?
Employer cleaning companies are mid-sized businesses: the average janitorial firm with employees took in about $1.13 million in 2022 with 18 employees. The far more numerous solo businesses are tiny: 1.05 million nonemployer janitorial businesses averaged under $20,000 in receipts each. Where your company sits on that line decides what “margin” even means for you.
| 2022, United States | Janitorial services (561720) | Carpet and upholstery cleaning (561740) |
|---|---|---|
| Employer firms | 63,999 | 6,695 |
| Receipts | $72.6 billion | $4.16 billion |
| Annual payroll | $31.4 billion | $1.56 billion |
| Employees | 1,148,248 | 42,426 |
| Payroll as a share of receipts | 43.3% | 37.6% |
| Receipts per firm | about $1,135,000 | about $621,000 |
| Receipts per employee | about $63,000 | about $98,000 |
| Payroll per employee | about $27,400 | about $36,900 |
| Nonemployer (solo) businesses | 1,045,769, averaging about $19,900 in receipts | 31,555, averaging about $35,700 |
Sources: employer figures from the 2022 Economic Census sector 56 basic table; solo figures from the Census Bureau’s 2022 Nonemployer Statistics (US file, NAICS 56172 and 56174). Nonemployer receipts are what the business reported to the IRS, so they include part-time and side businesses, which is why the average is low.
What the table means for your margin:
- Payroll per employee is low because many cleaners are part-time. $27,400 a year at the janitorial firms is about 1,600 hours at the median wage. Part-time crews are normal in this trade, and they are why residential companies can keep payroll near 43% while paying a fair hourly rate.
- Receipts per employee set the ceiling on margin. At $63,000 of revenue per employee, every $1 an hour of extra pay costs about 2.5 points of margin. Carpet cleaners earn $98,000 per employee because a truck-mounted machine does in an hour what a hand crew does in a day; that is the equipment-for-labor trade that specialty services make.
- Solo businesses do not have a margin problem, they have a volume problem. At $19,900 in average receipts, most are part-time. A solo cleaner working full time at $150 a clean would bill around $75,000, nearly four times that average.
How do margins differ between residential and commercial cleaning?
Residential cleaning earns more per cleaner-hour but spends more of each day driving and selling; commercial cleaning earns less per hour but fills whole evenings at one address under a contract that runs for years. A well-run company can reach the same 10% to 20% net target in both, by different routes.
| Margin driver | Residential | Commercial and janitorial |
|---|---|---|
| Price per cleaner-hour | Higher: a 3.5 hour clean at $150 is about $43 an hour | Lower per hour, set by bid; often $25 to $40 an hour equivalent on small offices |
| Unpaid time | Driving between 2 to 4 homes a day, quoting, cancellations | Little driving; one site for 3 to 8 hours; cancellations rare |
| Labor share | About 55% to 60% including payroll costs | Often 60% to 70%; Census payroll ratio for janitorial employers is 43% before payroll costs |
| Supplies and equipment | Small: $10 to $15 a visit | Larger: floor machines, consumables often supplied to the client, chemicals bought in bulk |
| Revenue stability | Recurring but easy to pause; seasonal dips | Contracts of 1 to 3 years; slower to win, slower to lose |
| Payment | Card after each visit; little bad debt | Invoiced on 30 day terms; cash tied up, some bad debt |
| Where margin leaks | Slow cleans, long drives, discounts, no-shows | Underbid square footage, night supervision, supply overuse, late payers |
Two practical conclusions. A residential company improves margin mostly by cutting unpaid time: dense routes, firm cancellation terms, instant quotes. A commercial company improves margin mostly at the bid: measuring the space properly, setting production rates per square foot, and not winning contracts on price alone. Our guide to office cleaning prices covers the bid math, and the commercial cleaning calculator works a quote from square footage and frequency.
A worked month: where a 12% net margin comes from
Here is a hypothetical month for a residential company with three full-time cleaners and an owner who runs the office, built on the same $150 clean. Revenue is $19,350, gross profit $6,773 (35%), and after overhead that includes a salary for the owner’s office work, net profit is $2,322, a 12% net margin. The same month is laid out as a profit and loss statement for a cleaning business, with each line mapped to Schedule C.
| Monthly, worked example | Amount | Share of revenue |
|---|---|---|
| Revenue: 129 cleans at $150 (3 cleaners × 43 cleans) | $19,350 | 100.0% |
| Cleaner wages: 129 × 3.5 hours × $20 | − $9,030 | 46.7% |
| Payroll taxes, workers’ compensation, paid drive time (25%) | − $2,258 | 11.7% |
| Supplies: 129 × $10 | − $1,290 | 6.7% |
| Gross profit | $6,773 | 35.0% |
| Owner’s pay for scheduling, quoting and quality checks (about 25 hours a week) | − $2,000 | 10.3% |
| Vehicle costs and fuel | − $650 | 3.4% |
| Insurance (liability, bond, commercial auto) | − $350 | 1.8% |
| Software, phone, website | − $250 | 1.3% |
| Marketing and lead fees | − $450 | 2.3% |
| Card processing fees (about 3%) | − $580 | 3.0% |
| Accounting, licenses, uniforms, equipment replacement | − $170 | 0.9% |
| Net profit before income tax | $2,322 | 12.0% |
Overhead comes to $4,450, or 23% of revenue, a little above the 20% the single-clean model assumed. That is typical at three cleaners: the owner’s office time is a real cost whether or not it appears on a pay stub, and it does not shrink as fast as revenue grows. The owner in this example earns $2,000 in pay plus $2,322 in profit, about $52,000 a year, without cleaning.
The example assumes full schedules and no cancellations. Drop 8 cleans to cancellations and sickness, and revenue falls $1,200 while wages, if you still pay the cleaners’ scheduled hours, fall by nothing. Net profit goes from $2,322 to about $1,200, and the margin from 12% to under 7%. That one line is why cancellation policies and route density matter more to margin than any supply discount. Enter your own numbers in the cleaning business profit calculator to see your version.
What shrinks a cleaning business’s profit margin?
Margin leaks through time nobody bills for: slow cleans, long drives, cancellations, re-cleans and admin. Discounts and supply waste matter too, but they are smaller. Each leak below is sized against the worked month so you can see which to fix first.
- Cleans that run long. If the 3.5 hour clean averages 4 hours, wages and payroll costs rise by $1,613 a month and net margin falls from 12% to about 4%. The fix is time standards per home and re-quoting the homes that always run over.
- Drive time. Thirty extra minutes of paid driving per cleaner per day across three cleaners is about 32 hours a month, $800 with payroll costs, four points of margin. Cluster clients by neighborhood and day.
- Cancellations without a fee. Each cancelled $150 visit with cleaners still on the clock costs $150 of revenue and saves only $10 of supplies.
- Re-cleans and refunds. A re-clean is a visit at zero revenue and full cost. Checklists and a photo at the end of each job cut them.
- Discounts set by feel. A 20% recurring discount on a clean that only saves 10% of the time gives away $15 a visit, nearly the whole net profit on it.
- Unpaid owner time. It hides the true overhead. If you quote, schedule and chase payments for 25 hours a week and call that free, your “20% net” is really 8%.
- Supply waste. Real but small: doubling supplies to $20 a visit costs 6.7 points of margin, and the usual fixes (concentrates, measured dilution, microfiber laundered in-house) recover a few points at most.
How do you raise the profit margin of a cleaning business?
Raise prices first, then cut unpaid time, then grow the share of recurring clients and add-ons. In the worked month, a 5% price increase alone lifts net margin from 12% to about 16%, because nearly all of the extra revenue falls to the bottom line.
- Raise prices once a year. 5% on $19,350 is $968 a month with no extra cost beyond card fees. Give existing clients 30 days’ notice; raise new-client prices immediately.
- Set a cancellation policy and take a card on file. A 50% fee inside 24 hours turns the biggest leak into a small one. Our free cancellation policy template gives you the wording.
- Build dense routes. Say no to homes outside your core area, or add a travel fee. Every paid hour of driving you remove is about $25 back.
- Time every job and re-quote the outliers. Clock-ins from a crew app show which homes run long. Re-price them from real hours.
- Sell the first visit as a deep clean. It takes longer, so it should cost more, and it stops a new client’s first standard clean from running two hours over.
- Push recurring over one-time. Recurring clients cost nothing to re-sell and take less time per visit. A calendar that is 80% recurring is steadier and cheaper to run than one that is 50%.
- Price add-ons from minutes. Inside the oven at $35 for 45 minutes earns the same margin as the main clean. Add-ons that are “thrown in” earn nothing.
- Pay for performance carefully. A small commission on add-ons sold, or a bonus for a month of on-time jobs with no re-cleans, costs less than the problems it prevents. Keep the base wage fair; margin built on underpaid cleaners does not last.
Growth by itself does not raise margin. Three cleaners at 12% net become ten cleaners at 12% net, plus a manager, unless the price and the time standards improve along the way. The guide to growing a cleaning business covers what changes at each stage.
How should you track margin month to month?
Track three numbers every month: labor as a share of revenue, gross margin, and net margin after your own pay. Look at them by service type too, because a standard clean, a deep clean and an Airbnb turnover rarely earn the same margin.
The monthly routine
- Pull revenue by service type from your scheduling or booking software.
- Pull hours by job from clock-ins, and multiply by the loaded hourly cost to get direct labor.
- Add supplies, then compare gross margin by service: if move-outs are at 25% and standard cleans at 36%, your move-out price is too low or its hours are wrong.
- Take overhead from your accounting software, including a line for your own time.
- Write down net margin, and the one change you will make next month.
Targets that work for most residential companies: direct labor under 60% of revenue, gross margin above 35%, overhead under 25%, net above 10%. If labor is above 65%, nothing else matters until prices or job times change.
Broombook shows revenue by week, hours from clock-ins per visit and unpaid visits, which covers steps one to three without a spreadsheet; the accounting side (overhead and the P&L itself) still lives in your bookkeeping software. Our guide to accounting software for cleaning businesses compares the options, and the profit calculator is a quick way to test a price or wage change before you make it. If you plan to sell the business one day, buyers price it on these same margins; see how to sell a cleaning business.