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Chicagoland Pressure washing Pricing Workshop


Guide to Successful pricing in the Chicago land market!

 

All Operating costs will be different, we are not telling you what to charge but giving insight into the costs in the local market.

 

Chicagoland Area Pricing IS NOT National Average Pricing!

 

How much more is the cost of living in the Chicago area than the national average?

 

Chicago area Real estate is 38% more expensive than the U.S average, while utilities are about 11% less pricey. When it comes to basic necessities such as food and clothing, groceries are around 7% more in than in the rest of the country, while clothing costs around 7% more and Fuel is about 22% more.

 

On average in the Chicago area, we are 41% Higher than the national average.

 

National average is $281 for a house wash so If you take that average and multiply it with our 41% higher costs of living in the Chicago land area Our house Wash average should be $397

 

Undercharging for Your Services

Setting your prices too low is a common mistake in the pressure washing industry. New businesses often underprice their services, thinking it will attract more customers. However, this approach can lead to a variety of problems, including operating at a loss, struggling to meet expenses, and devaluing the industry as a whole.

The solution to this issue is conducting thorough market research and pricing your services competitively. Understand what your competitors are charging, factor in your expenses and profit margin, and set a pricing structure that reflects the value you provide. While you may not win every price war, you will attract clients who appreciate quality over low prices.

IF YOU WIN EVERY BID, YOUR PRICES ARE TO LOW!!!

 

Estimate Materials and Overhead Costs

We only have about 34 weeks to work per year with our line of work. With that being said based on a 40 hour work week we have about 1360 total hours we can possibly work, but when we factor in all the things we do in business that cost us our time that we do not get paid for (Estimates, Drive time, Picking up Chemicals or supplies for a job) we will only be able to bill about 30 hours a week. So that comes out to 1020 billable hours.

Besides, many of us lose out to days of bad weather and the personal issues that come up from time to time.So we are lucky to be able to bill somewhere around 1020 hours every year with a one-truck shop. This means that we expect to average 127.5 hours (billable) per month. Now that we understand this, we can apply the costs and determine our target hourly charge.

So how much do I need to make to be profitable you ask, well let me break it down!

 

·       If my business insurance costs $400 Per month ($3.14 per hour)

·       And Health insurance cost me $1200 a month for my family ($9.41 Per Hour)

·       And my truck costs me $500 per month ($3.92 Per Hour)

·       And my vehicle insurance costs $125 per month ($0.98 Per Hour)

·       And I spend $800 each month on marketing ($6.27 Per Hour)

·       And I am spending about $10 per hour on fuel for my equipment.

·       And I spend $2800/month on rent and utilities ($21.96 Per Hour)

·       And the telephone costs $200 per month ($1.57 Per Hour)

·       And I spend $600 per month on gasoline for my truck ($4.71 Per Hour)

·       And I want to make $100,000 as my base salary ($98.04 per hour)

·       And I need to set aside about $25,000 per year for repairing/replacing equipment and growing the business ($16.34 Per Hour)

·       And accepting credit cards costs me 3% of what I sellSo how much should my estimates be billed per hour? (If you were to break it down that way)The costs used in this example! tells you that you must generate at least $181.63 per hour for every billable hour you work, plus whatever materials cost you and you had better be able to bill for at least 1020 hours or you will fall sadly short of the target.If you spend about 15% of what you take in on cleaners, sealers, and supplies, then we can determine that you must charge approximately $208.87 per hour in order to meet your business planning numbers.

 

Once you know this number no matter what job you are doing you will know about how long it will take and then from there you can give the price how ever you want Per SqFt, Linear foot, or per job.

The number we have reached here is a hypothetical one and will change with every company. You might spend more or less on any one of these budget lines. The important thing is that you do at least this much planning every year, with a clear idea of what you need and what you want as a business owner.

 

Never Stop Learning

One of the biggest factors contributing to the failure of pressure washing businesses is a lack of ongoing learning and improvement. Pressure and Soft washing techniques, equipment, and best practices are constantly evolving.

To counter this, successful pressure washing entrepreneurs make a commitment to continuous learning. They invest in staying updated on industry trends, attending workshops, and seeking certifications. This proactive approach ensures they remain competitive, offer the best results, and attract a steady flow of clients.

·       PWNA (Power Washers of North America)

·       CETA (Cleaning Equipment Trade Association)

·       Training Classes

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