Last editedMay 20233 min read
If you run a cleaning business then deciding how much to charge your customers and actually taking payments are both extremely important. If you make a mistake, then the cash flow of your business could be severely disrupted, as could your profit margins. In this cleaning services pay guide, we’ll look at how to calculate how much to charge customers and the methods you can use to make those payments.
Payment terms for cleaning services
Before providing any cleaning services, you have to ensure that the payment terms have been agreed and are understood by the customer. The details will include the amount being charged, either as an hourly rate multiplied by the number of hours worked or as a flat rate agreed beforehand. In addition to the total being charged, the payment terms will cover the date on which the work was carried out, the payment methods you are willing to accept and how soon you expect the payment to be made. All of this information should be set out on an invoice, which creates a written record of the work done and the payment expected.
Deciding on a price
Deciding on the price to charge your clients will depend on a variety of different factors. Even something as fundamental as the part of the country you live in could have an impact, with the average hourly rate in London, for example, being higher than across the rest of the country. Bearing that in mind, a quote for a cleaning payment should be based on the following factors:
The property – pay a visit to the house which is going to be cleaned to assess the size and type of the rooms and any factors which may add to the amount of work involved, such as multiple bathrooms. Although the customer may have described the property, only an in-person visit will establish exactly how much cleaning work is likely to be involved.
Estimate – having examined the property, you can then make an educated estimate of how many hours it will take you to clean it. Multiplying the number of hours by your house cleaning hourly rate will provide a base figure for the cleaning payment.
Overheads – add any overheads involved in your work, such as cleaning product supplies, the equipment you use and the cost of travelling to and from the house. You must factor these in to ensure you generate a profit.
Markup – speaking of profits, once you’ve calculated a base figure for your cleaning payment you need to add a percentage markup in order to generate an actual profit on the work being delivered. To keep the process simpler, particularly when dealing with multiple customers, you should choose a figure, such as 30%, and include this on top of the figure you calculated using the size of the property, an estimate of the cleaning time and your hourly rate plus overheads.
Choosing a cleaning payment method
Any invoice you produce on the basis of your chosen cleaning payment amount should include details of the payment methods. In simple terms, the more payment methods you offer, the happier your customers are likely to be, since they’ll be able to opt for the method they are accustomed to using. One choice you’ll probably have to make will be between cash payments and a direct debit payment.
Cash or direct debit
The advantages of cash in hand cleaning payments include the speed with which you’ll receive the payment and the lack of paperwork involved. Unfortunately there are also disadvantages. These disadvantages include the fact that cash payments, particularly multiple cash payments from different cleaning customers, will quickly become difficult to track and record. This could lead to problems tracking your cash flow and also cause headaches when the time comes to fill in your self-assessment tax return.
If you get paid by direct debit, on the other hand, the money will be transferred directly into your bank account from the customers on an agreed date, i.e. the 15th of every month. This makes it easy to keep track of the money coming in and out of the business and to plan in advance. It also creates an easily accessed ‘paper-trail’ for the purposes of tracking your earnings.
Working with GoCardless
Partnering with GoCardless makes it easier than ever to accept subscription or recurring payments from customers, and the fact that the platform integrates seamlessly with existing business software means that you can automate the billing process using invoicing software and let GoCardless do the rest. Alternatively, if the cleaning job in question is a one-off arrangement, then you can send the customer a payment request link using Instant Bank Pay. Accepting direct payments in this manner will help to cut late payments, reduce the admin you need to deal with and increase customer satisfaction. In simple terms, GoCardless helps to make the payment process as neat and tidy as you aim to leave your customers’ houses.
We can help
GoCardless is a global payments solution that helps you automate payment collection, cutting down on the amount of financial admin your team needs to deal with. Find out how GoCardless can help you with one-off or recurring payments.