How Profitable is a Cleaning Business (2024 Stats)?
The cleaning services industry in the U.S. has shown significant growth, with a valuation of $90.2 billion in 2023. But what does this mean for individual cleaning businesses within the industry? How much revenue do they make? Is a cleaning business really profitable?
This article delves into the market segments, average revenues, and startup costs, providing a clear picture of the profitability landscape for cleaning businesses.
With data-driven insights, we aim to offer a comprehensive overview of the financial dynamics of the cleaning services industry in 2023. Let’s dive in!
Commercial Cleaning Business Plan Template (Download)
Download an expert-built 5-year Excel financial model for your business plan
Commercial Cleaning Business Plan Template (Download)
Download an expert-built 5-year Excel financial model for your business plan
Cleaning services market overview
As per IBIS, the cleaning services market in the U.S. represented $90.2 billion in 2023 and is expected to grow to $123.4 billion in 2028.
Commercial cleaning service represents the largest share ($64.9 billion) followed by residential interior cleaning service ($9.0 billion), other cleaning service ($9.0 billion), and damage restoration and cleaning service ($7.2 billion). Yet, with over 1.2 million cleaning service providers across the country, the competition is also fierce.
How much revenue does a cleaning business make?
Now, using the data from more than 660 franchised cleaning businesses, a cleaning service provider earns $585,000 in gross revenue per year on average. This number is the average gross revenue per service provider from 660 franchises of the largest 8 cleaning business franchises in the U.S.
With an average cleaning cost of $200, that’s a total of ~2,900 cleaning jobs per year. Assuming 250 working days per year, that’s on average 12 jobs per day per service provider.
Yet, not all cleaning service providers have the same yearly revenue. Logically, some will earn more than others because of many factors like location, clientele base, service offerings, operational efficiency, etc.
Indeed, using the same source earlier, it’s safe to assume that the average turnover for a cleaning service provider is around $75,100.
Indeed, the U.S. cleaning industry is worth $90.1 billion in 2023 and there are about 1.2 million service providers across the U.S. Of course, this includes small businesses with 1 or 2 employees as well as sole proprietors.
How much does it cost to start a cleaning business?
On average, it costs between $70,000 to $142,000 to start your own cleaning business.
This includes various costs such as initial inventory, marketing, insurance, professional fees, training expenses, rent, leasehold improvements, furniture and fixtures, equipment, computer hardware and software, business vehicles, business permits and licenses, working capital for the first 3 months, miscellaneous funds, etc.
- Opening inventory and supplies (17%): funds for initial stock of cleaning supplies and inventory.
- Marketing (6%): costs for advertising, online campaigns, and promotional materials.
- Training expenses (7%): allocated funds for initial training of the cleaning staff.
- Rent and leasehold improvements (5%): cost of renting an office space and the costs to improve it for optimal use.
- Initial equipment, furniture, and signage (10%): cost of purchasing essential cleaning equipment, furniture for workspace, and signage to establish a professional and visible presence.
- Computer hardware and software (5%): cost of acquiring the necessary technology infrastructure to efficiently manage administrative tasks and communication.
- Business vehicle (22%): cost of a dedicated vehicle, providing transportation for the staff and equipment to various client locations.
- Working capital (22%): funds needed to operate the business for the first 3 months to pay for operating costs (mostly salaries and supplies).
- Miscellaneous items (6%): insurance, business licenses, and permits, etc.
Commercial Cleaning Business Plan Template (Download)
Download an expert-built 5-year Excel financial model for your business plan
Commercial Cleaning Business Plan Template (Download)
Download an expert-built 5-year Excel financial model for your business plan
