when I worked in recruitment we worked on 20 - 30% profit margin and the key to the companys success was VOLUME.
For example we would quote a local authority who required residential social workers £15 per hour per social worker.
We would pay £9 per hour to the social worker.
Out of the £6 gross profit, we would have to deduct tax, NI and holiday pay ending up with about £4.50 net profit per hour per social worker.
We used to do 1000 hours a week from our office.
The £9 per hour is one of the best pay rates in the unqualified social worker field and consequently we attracted the best workers. The quality of their work reinforced our excellent market reputation and we were kept very busy even though the authority could go to our competitors and get staff for £11/£12 per hour, they were sent unreliable staff who were being paid £6-£7 per hour by their agency.
If you apply this logic to window cleaning, you would be looking at for example:
give 1 cleaner 15 houses per day at £10 per house over 20 days (mon-Fri) and that is £3000 turnover per 4 weekly cycle.
Contract them to carry out 12 annual cleans but on a 4 weekly turnaround.
This gives you and them 4 additional non work weeks a year to use as holidays or to cover catch up work.
EXAMPLE: (insert your own pay level) - Pay them £2000 per 4 weekly clean which is £24,000 per annum.
This is leaving you with £1000 per month gross profit for 1 employee.
There would be little danger of the employee jealously thinking "I can earn more on my own" at this no stress pay level. Remember LOW PROFIT MARGINS and VOLUME.
Not a lot but you should have in place a well paid employee who is on a good salary and has the freedom of working to a not particularly taxing schedule of 15 houses.
Now if you were to have 2 employees like this ,working to the same formula, you now have £2000 gross profit coming to you every 4 weeks.
Get these 2 employees in a van and combine both their schedules and deduct approx £300 for repayments on the van and your gross profit every 4 weeks is £1700
2 vans and 4 employees is £3,400 gross profit every 4 weeks.
4 vans and 8 employees is £6,800 gross profit every 4 weeks.
10 vans with 20 employees is £17,000 gross profit every 4 weeks.
Gross annual profit after 12 cleans have been carried out in the year by every van is:
£204K.
Each employee has been paid and all van repayments have been met.
Deduct 50% of this to cover your own taxes and other expenses and you have a nice
£102K profit every year. APPROXIMATELY.
I deducted the 50% as a reasonable guess, it may be more but it may also be less.
I think if you were able to develop easily manageable rounds in relatively compact areas for each van, your management of the vans schedule should be pretty straightforward and fuel costs would be kept as low as possible.
These figures may seem pretty simple to follow for some people and I know, understand and have experienced many times, MURPHYS LAW which says something is bound to go wrong. Of course it is. It is a challenge of running a successful business and if each challenge is met head on and dealt with in the most efficient manner available to you, the experience will only streamline your operation.
The wages should attract good staff. They are working in pairs in a wfp fitted out new van. They have good schedules of work that wont break their backs or spirits.
It should work.
It will probably keep you awake at night.
Time to promote one of them to be an "operations manager" and oversee the whole set up.