Saturday, October 23, 2010

How to Calculate a Janitorial Bid

janitor,custodian,cleaningMany commercial janitorial contracts start with a bidding process. Even residential customers have a tendency to base their decision, at least in part, on the price you charge. This makes calculating the amount of your bid an important factor in the success of your company. The bid must be low enough to be an attractive offer over competing bids, but must also remain high enough to be profitable for the business. Determining how much to bid is an art, but one that is helped along with a few standard considerations.

Materials:
  • Janitorial cleaning business
Step 1: 

Obtain the details pertaining to the project you are bidding on. Determine the type of janitorial services required, how often they are needed and how large the area to be cleaned will be. If at all possible, visit the location in person to see the site you are bidding on, as well as to ask questions that could uncover any unexpected requirements before submitting your bid.

Step 2:

Plan the janitorial duties and create a list of all the items that will be needed. Account for all items that will be required to complete the job, such as garbage bags, cleaning solutions, rubber gloves, disinfectant, brooms and mops. Anything that will be needed in order to complete the job should be listed so that the cost can be accounted for. 

Step 3:

Estimate the number of man hours that will be required to complete the project. Start by determining how many people will be required to clean the facility and then estimate how many hours it will take them to complete their duties. Multiplying these two figures by each other will give you the estimated man hours for the job.


Step 4:

Calculate the total project costs. Add the amount that will be required for supplies to the wages that will be paid to the cleaning crew. This will give you the estimated costs for completing the project. It is generally recommended that you add 10% to this figure in order to account for any unexpected costs.


Step 5:

Determine your minimum profit threshold. Consider how much you must mark up the price to make the endeavor profitable. Many people consider a 20% price increase to be ideal, but you have to be careful to make sure that your final price is competitive to other bids that will be submitted by competing agencies.

Tips:

Follow up on your bid with a telephone call to ask if the potential client has any additional questions that you can answer. The more opportunities you have to encounter the person reviewing the bids, the more you will stand out in their memory.

References:

"Janitorial Bidding Guide, Your #1 Source for America's Best Bidding Information, How to Bid, Price and Make Money In Your Own Janitorial Business"; Jay D. Pennington; 2002 

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