What is loaded labor rate in cleaning job costing?

Loaded labor rate is the hourly wage plus payroll taxes, workers compensation, benefits and other employee-related costs. It represents the true cost to employ someone for an hour, not just their base pay. Most contractors load 25-40% on top of base wages depending on their benefit package and insurance rates.

How do you calculate overhead percentage for a cleaning bid?

Overhead percentage covers indirect costs like office rent, utilities, insurance, administrative salaries, vehicles and marketing. Calculate it by dividing your annual overhead expenses by your annual direct labor costs, then multiply by 100. A 20% overhead rate means for every dollar of direct labor, you spend twenty cents on running the business.

What is the difference between margin and markup in job costing?

Margin is profit as a percentage of the selling price, while markup is profit as a percentage of cost. A 22% margin means profit is 22% of what the customer pays. The same dollar profit expressed as markup would be higher because the denominator is smaller. Job costing typically uses margin because it shows profitability against revenue.

Where do travel and supplies belong in job cost?

Put them in other direct costs when they are job-specific. Recurring OH (office, insurance, idle time) belongs in the overhead percentage — missing either one underbids the job.

How is this different from Bill Rate?

Job Costing prices one job’s hours and OH into a bid floor. Bill Rate sets the hourly rate behind those hours. Use both: rate first, then job total.

Job Costing Calculator

Missing overhead is how winning accounts quietly lose money.

Inputs

Total labor hours

Loaded labor rate ($/hr)

Overhead (%)

Target margin (%)

Supplies cost ($)

Travel cost ($)

Equipment cost ($)

Subcontractor cost ($)

Total sqft

Calculate the bid price for a cleaning job by adding labor, supplies, equipment, subcontractor and travel costs, then applying overhead and your target profit margin. The result shows what to quote the client and your per-square-foot rate when area is entered.

Instruction

Enter total labor hours and your loaded labor rate per hour.
Set overhead percentage and target margin percentage.
Add supplies cost, travel cost, equipment cost or subcontractor cost if applicable.

Worked example

A one-off job needs 8 labor hours at $24/hr loaded, 20% overhead, and a 22% target margin.

Floor bid is about $295 — $192 labor + $38 overhead, then margin on top. Below that, you are buying the work.

Questions operators ask

What is loaded labor rate in cleaning job costing?: Loaded labor rate is the hourly wage plus payroll taxes, workers compensation, benefits and other employee-related costs. It represents the true cost to employ someone for an hour, not just their base pay. Most contractors load 25-40% on top of base wages depending on their benefit package and insurance rates.
How do you calculate overhead percentage for a cleaning bid?: Overhead percentage covers indirect costs like office rent, utilities, insurance, administrative salaries, vehicles and marketing. Calculate it by dividing your annual overhead expenses by your annual direct labor costs, then multiply by 100. A 20% overhead rate means for every dollar of direct labor, you spend twenty cents on running the business.
What is the difference between margin and markup in job costing?: Margin is profit as a percentage of the selling price, while markup is profit as a percentage of cost. A 22% margin means profit is 22% of what the customer pays. The same dollar profit expressed as markup would be higher because the denominator is smaller. Job costing typically uses margin because it shows profitability against revenue.
Where do travel and supplies belong in job cost?: Put them in other direct costs when they are job-specific. Recurring OH (office, insurance, idle time) belongs in the overhead percentage — missing either one underbids the job.
How is this different from Bill Rate?: Job Costing prices one job’s hours and OH into a bid floor. Bill Rate sets the hourly rate behind those hours. Use both: rate first, then job total.