What counts as a realistic wage shock percentage for cleaning contracts?

Minimum wage increases of 8-12% happen in many states during election cycles or scheduled adjustments. If you rely on entry-level workers in a tight labor market, plan for 10-15% to retain staff when competitors raise pay. Union contracts often lock in 3-5% annual bumps.

Should I test supply shocks separately or combine them with wage increases?

Run both. Cleaning chemical and paper costs can spike 10-20% when oil prices climb or supply chains tighten, and those shocks often overlap with wage pressure during inflation. Testing them together shows your true downside if a client locks you into a fixed price for 12 months.

How do I use the stress test result when a client asks for a mid-contract discount?

Plug their discount request into the tool along with any cost increases you have already absorbed since the contract started. If the result shows your margin dropping below 8-10%, you have a number to show the client when you counter-propose a smaller reduction or a scope cut instead.

What does High vulnerability mean in practice?

Enough scenarios fall under your target margin that a normal wage bump or discount request can erase profit. Rebuild hours or rate before the client signs.

Should I show the stress test to the client?

Usually show the clean bid; keep the stress test internal. Use it to decide walk-away points and which concessions you can actually afford.

Bid Stress-Test

Winning bids die on wage bumps and hour creep.

Inputs

Monthly contract value ($)

Labor % of revenue

Supplies %

Overhead %

Target margin (%)

State

Carried from Bid Generator for context — stress scenarios stay margin-based

Wage shock (%)

Scheduled wage increase — combined with turnover/OT drag below

Turnover & shift-cover drag (%)

Janitorial turnover often 100–150%/yr — unfilled shifts, OT cover, and new-hire training eat margin faster than wage alone

Supply shock (%)

Client discount (%)

Models how a cleaning contract's margin holds up when labor costs spike, supply prices jump, or a client demands a discount. Enter your monthly contract value, current cost structure as percentages of revenue, and the size of potential cost shocks to see whether your target margin survives.

Instruction

Enter monthly contract value and break out labor, supplies, and overhead as percentages of revenue.
Set your target margin and the size of wage, supply, and discount shocks you want to test.
Read the vulnerability assessment to see if your margin withstands the combined pressure.

Worked example

A $5,000/mo contract with 58% labor, 8% supplies, 18% overhead, and 16% target margin faces a 10% wage shock, 15% supply jump, and 5% client discount.

Baseline holds 16% margin, but combined shocks drop it to ~4.2% (High vulnerability) — rebuild hours or rate before signing.

Questions operators ask

What counts as a realistic wage shock percentage for cleaning contracts?: Minimum wage increases of 8-12% happen in many states during election cycles or scheduled adjustments. If you rely on entry-level workers in a tight labor market, plan for 10-15% to retain staff when competitors raise pay. Union contracts often lock in 3-5% annual bumps.
Should I test supply shocks separately or combine them with wage increases?: Run both. Cleaning chemical and paper costs can spike 10-20% when oil prices climb or supply chains tighten, and those shocks often overlap with wage pressure during inflation. Testing them together shows your true downside if a client locks you into a fixed price for 12 months.
How do I use the stress test result when a client asks for a mid-contract discount?: Plug their discount request into the tool along with any cost increases you have already absorbed since the contract started. If the result shows your margin dropping below 8-10%, you have a number to show the client when you counter-propose a smaller reduction or a scope cut instead.
What does High vulnerability mean in practice?: Enough scenarios fall under your target margin that a normal wage bump or discount request can erase profit. Rebuild hours or rate before the client signs.
Should I show the stress test to the client?: Usually show the clean bid; keep the stress test internal. Use it to decide walk-away points and which concessions you can actually afford.