Last Updated on October 26, 2024 by The ZenMaid Team
Thinking of starting a cleaning business, or ready to scale the one you’ve got? Wondering if it’s truly profitable? The short answer: Absolutely. The key lies in smart strategies — and we’re here to break down what numbers to expect, and what profitable tips our industry experts swear by.
How Profitable Is a Cleaning Business?
Starting a cleaning business can be one of the most profitable ventures in the service industry.But, profitability varies significantly depending on several factors, including the type of services you offer, your location, and how well you manage your business.
On average, cleaning business profit margins range from 20% to 28% for well-established companies. Cleaning services have relatively low startup costs compared to other businesses, which means you can expect positive cash flow as you build your client base and streamline your operations. Here’s a closer look at the income potential.
How Much Can You Make as an Owner of a Cleaning Business?
The average income for cleaning business owners in the United States is upwards of $120,000 per year. Now, that’s factoring the average registered cleaning businesses, including the biggest franchises in the country. So what’s a more realistic income? Let’s break it down by year.
Year 1: Building a Foundation
In your first year, it’s realistic to earn between $20,000 and $50,000, depending on your ability to secure recurring clients and manage expenses like supplies and marketing. This foundational year often focuses on gaining momentum, optimizing service offerings, and setting up systems for efficiency.
Years 2-5: Growing and Scaling
With a steady client base and more efficient operations, annual earnings can jump to $50,000–$100,000. This phase typically includes expanding into more profitable areas like commercial cleaning or upselling services. Securing commercial contracts can significantly increase revenue, as these clients often pay more consistently and in higher amounts.
Years 5-10: Establishing as an Industry Leader
After five years, established cleaning business owners can reach six figure incomes. Some might even consider franchising. We see a lot of our most successful ZenMaid customers stepping out of the day-to-day operations and enjoy running their business remotely.
How Much Does It Cost to Start a Cleaning Business?
Starting a cleaning business can be surprisingly affordable. Here’s a quick overview of typical startup costs:
- Business Registration: $50–$500, depending on state requirements
- Insurance: $200–$500 annually for liability coverage
- Cleaning Supplies and Equipment: $300–$700
- Marketing Materials: $200–$400 (DIY website, business cards, etc.)
For a more detailed breakdown, check out our 10-step guide to starting a cleaning business which covers these costs and explains how to set up your business for long-term success.
Residential vs. Commercial Cleaning Profitability
The second question to answer when researching is a cleaning business profitable is: what kind of cleaning business are we talking about? The two primary categories are residential and commercial cleaning, each with distinct profitability profiles and challenges.
Residential Cleaning Profitability
Residential cleaning is generally faster to launch because of lower entry barriers and a high demand for regular cleanings. The profitability of a residential cleaning business often depends on how many clients you can serve and whether you charge hourly or flat rates.
Residential cleaning businesses can also boost revenue by offering add-on services like carpet cleaning, window cleaning, or eco-friendly products. For example, charging for extras like inside oven cleaning, refrigerator cleaning, and laundry services adds flexibility to your pricing model and brings in additional revenue.
Commercial Cleaning Profitability
Commercial cleaning is often more profitable than residential cleaning but may require more significant initial investment, including equipment like floor buffers, industrial vacuums, and specialized cleaning products.
The upside of commercial contracts is that they often offer higher revenue per job and more predictable income. Many commercial clients require regular services multiple times per week, making them reliable, long-term clients. This consistency provides a steady income stream and allows for more robust financial forecasting compared to residential cleaning.
Cleaning Business Revenue and Expenses: What to Expect
Here’s a breakdown of common costs in a new cleaning business.
Startup Costs
The initial investment for a cleaning business is relatively low. Essential expenses might include:
- Basic cleaning supplies (e.g., disinfectants, microfiber cloths, vacuums)
- Marketing and website setup
- Business registration and insurance
You can start a residential cleaning business for as little as $1,000 to $2,000, depending on the equipment quality and business registration fees.
Operating Expenses
Typical operating expenses for a cleaning business range from 25% to 30% of revenue, including:
- Labor costs (paying cleaners and supervisors)
- Supplies and equipment (restocking cleaning agents, replacing worn tools)
- Insurance and licensing (essential for liability protection)
- Transportation costs (gas, vehicle maintenance)
Profit Margins
Aiming for a profit margin of at least 20% is a reasonable goal for most cleaning businesses. This means if your business generates $10,000 in monthly revenue, you should aim to keep at least $2,000 as profit after expenses.
How to Make a Cleaning Business More Profitable
The cool part about running profitable cleaning business is the sky’s the limit. Here’s how you can make even more money with a cleaning business.
1. Set Competitive Rates
Setting rates that cover your costs while staying competitive is crucial. This guide to setting prices breaks down industry standards and offers tips on how to calculate a profitable rate. Keep in mind that while underpricing can hurt your bottom line, overpricing might push potential clients toward competitors.
2. Add High-Demand Services
Offering services like eco-friendly cleaning, deep cleans, or specialty services popular in your local area (e.g., carpet cleaning, window cleaning) lets you differentiate from competitors and increase revenue. A lot cleaning businesses find success by charging a premium for add-ons, allowing them to maintain steady profits while adding value for clients.
3. Streamline Operations with Software
Using cleaning service scheduling software to handle scheduling, invoicing, and client communication can save valuable time and reduce administrative costs. ZenMaid offers features that allow you to automate reminders, manage your calendar, and track payments seamlessly. Implementing these systems can save an average of 10–20 hours per week, which translates to both time and money saved on labor.
4. Use Marketing to Reach More Clients
Marketing is essential to grow your client base and increase profitability. You don’t need to invest heavily; start by optimizing your Google My Business listing and connecting with clients on social media. There are some great free ways to market your maid service if you’re just starting out.
5. Leverage Remote Management for Flexibility and Growth
Building a partially remote team allows you to manage your cleaning business from anywhere, making it easier to scale. According to Neel Parekh, founder of MaidThis®, outsourcing non-physical roles like administrative support can reduce costs while increasing efficiency. By using remote management tools such as Slack for communication and ZenMaid for scheduling, you can efficiently manage your cleaning team, reduce expenses, and improve overall productivity.
6. Manage Expenses Wisely
Tracking expenses is crucial for profitability. When setting your budget, dividing expenses into manageable percentages (e.g., 25% for marketing, 10% for supplies) helps ensure that your budget aligns with your income goals. Consistently reviewing expenses and finding ways to cut costs, like buying supplies in bulk, can protect your bottom line.
Best Tips to Increase Cleaning Business Profit
Once you’ve set your basic cleaning business profit strategies into place, consider these tips from our industry experts at ZenMaid.
- Offer Subscription Plans: Encourage clients to sign up for regular services (e.g., bi-weekly or monthly subscriptions) instead of one-off appointments. This provides a reliable revenue stream and allows for better financial forecasting. You can also offer small discounts on recurring services can be a powerful incentive for clients to book consistently, increasing long-term profitability.
- Focus on High-Value Clients: Not every client is equally profitable. Take time to understand who your ideal customers are and focus your efforts on attracting and retaining them. High-value clients might include those looking for regular deep cleaning or commercial clients who require more frequent services..
- Implement Efficient Training Programs: A well-trained team keeps clients happy and on the calendar. By standardizing training, you reduce the chances of errors or rework, which can cut into profit margins.
- Develop a Unique Selling Proposition (USP): To avoid becoming “just another cleaning service,” focus on what makes your business unique. Chose a niche or specialization that resonates with your target market, whether it’s eco-friendly products, hypoallergenic cleaning for clients with allergies, or specializing in Airbnb property cleaning.
- Automate Communication and Follow-Ups: Keeping in touch with clients can help build strong relationships, encourage repeat bookings, and secure referrals. Using automation tools and cleaning business software for email follow-ups and appointment reminders ensures clients feel taken care of without overwhelming your schedule.
- Optimize Your Pricing Structure: Regularly revisit your pricing structure to ensure you’re staying competitive and profitable. Adjust your rates based on factors like inflation, regional demand, and competitor rates. For instance, if your business is fully booked, this could signal it’s time to raise rates or focus on higher-paying clients.
The Sky’s the Limit for a Profitable Cleaning Business
The bottom line? A cleaning business can be highly profitable, but it’s all about making intentional moves. Focus on high-value clients, nail down efficient pricing, and build your team with growth in mind. It’s your turn to make this work for you.
Looking for more insights on whether a cleaning business is profitable? Join the ZenMaid Mastermind Facebook Community and get firsthand tips from fellow cleaning business owners.
