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The In-Source vs. Outsource Dilemma | A Case Study on the Hidden Costs of In-House Janitorial Teams

You’ve been approached by an outsourced cleaning service.  You currently manage an in-house team. Obviously in-sourcing is cheaper, right?  Let’s take a look…
We know what you’re thinking, obviously a $15/hour in-house custodian MUST be cheaper than a $30/hour outsourced solution.  It’s simple arithmetic! 
Unfortunately, wages are just the tip of the iceberg…
Consider the following hidden costs:
●       Payroll taxes – 10% of base pay, $1.50/hour
●       Benefits – The BLS estimates this to be $6.84/hour for a $15/hour wage earner
●       Vacation Time – 3.8% average downtime, $0.58/hour
●       Sick Time – 1% average downtime, $0.15/hour
●       Turnover Costs – $7,000 – $10,000, $3.36/hour
●       Equipment Acquisition & Repair Costs – $400/annually, $0.19/hour
●       Chemical Costs – $4,000/year average, $1.92/hour
●       Insurance (WC/Liability) – 6% of base pay, $0.90/hour
●       Management & Oversight – 10% of payroll, $1.50/hour
Taken together…you can conservatively add $16.94/hour to the baseline $15/hour figure to arrive at the true cost of a $15/hour in-house custodian.
Total Cost to In-Source: $31.94/hour
Still not convinced? 
Outsourcing your cleaning provides these added benefits:
●       100% Service Uptime
●       Management team steeped in facilities maintenance knowledge who spends all of their time thinking about commercial janitorial solutions
●       Professional employee supervision & training modules aimed at improving outcomes and overall efficiency
●       Enhanced flexibility to ramp service up/down based on internal facility usage patterns
●       After-hours option – can provide service outside of currently managed windows
●       Ancillary services expertise – carpet/tile/windows etc.
Next, let’s take a look at a real-life example…
In 2018 BCS Facilities Group was approached by a large uniforms distributor based in West Philadelphia, PA.  This uniforms company had been running a team of two in-house custodians for over a decade.  The team was working fine, but the second shift person was about to retire and the first shift person decided they didn’t want to shoulder the burden of the extra work and quit. 
The company was in a pinch and so for the first time in a decade decided to pursue an outsourced solution to their cleaning needs.  The customer estimated their total cost of labor for these two positions as follows:
●       Base Hourly Wage: $13.75/hour
●       Hourly Benefits Cost: $4.28/hour
●       Hourly Vacation/Sick Time Cost: $1.00/hour
●       Hourly Management Cost: $3.25/hour
●       Total Estimated Cost: $22.28/hour
BCS consulted with the customer to help identify the following additional costs specific to their business:
●       Employee Turnover Costs: $3.00/hour
●       Equipment Costs: $0.25/hour
●       Chemical Costs: $2.10/hour
●       Excess Insurance Costs: $1.10/hour
Resulting in an all-in estimated cost per hour of $28.73
BCS Quoted $28.00/hour, won the bid and has been working with this customer ever since.  Their facility is consistently look great, and the Plant Supervisor’s time has been freed up to pursue more meaningful work in the plant. 
Interested in learning more?
Want to retire from the “cleaning business” in your facility?
Give us a call today!

A Peak Behind The Curtain: Methods Used When Pricing Janitorial Services

When looking at daily janitorial services, it is important to distinguish what these services are, and what would be considered an extra, or additional service. These daily tasks typically consist of a few main elements: dusting and wiping down common surfaces (desks, tables, counter tops, ledges etc.), vacuuming, sweeping, dry and wet mopping, removing of trash, cleaning restrooms as well as kitchens/breakrooms.

Additional “extra” services not included in the daily janitorial work would be full window washing, all types of floor restoration (strip and wax for VCT tile, carpet shampooing etc.). These services would all be priced separately from the regular janitorial services.

Below, we will take a look at pricing methods for each.

Daily Services


When taking a look at this method, janitorial contractors, when evaluating your facility will determine how much time it would take in man hours to complete the cleaning scope. Based off of their hourly rate and number of hours required will determine a fair estimate to bill the customer. This typically includes all labor related costs, supplies, equipment, cleansers, mark-up etc.
Some pros and cons to this are that for the customer, you are essentially only paying for the hours worked. The con of this for the janitorial contractor is it can be tough to add increased effort/motivation for increased productivity. Depending on each company’s respective margins, this can cause a tight window to work with by adding extra time and pay to the front-line employees without increasing the price. This could also result as a pro with increased revenue for the janitorial contractor as increased hours by increasing the price for the customer. A con for the customer obviously from this is increased pricing for the extra work necessary to meet expectations. But, if these fluctuations present no issues, then this would be a good model to follow for the customer to get the most out of services.

Monthly Fee

One other popular method used is the fixed monthly fee model. After gathering as much information as possible and utilizing various calculation methods, a set monthly fee is determined. This usually consists of everything EXCEPT paper products and all types of consumables. This can provide more value to both the janitorial contractor and the customer. In most cases, this will present one of the most competitive prices to the customer as well as the servicer benefiting from possible efficiencies gained rather than going the price per square foot route.

Square Footage

This model is ultimately just as it sounds. There is a set fee for price per square feet, and gets multiplied by the square footage of the service area. For example, if the servicer provides a price of $0.25/square foot and there is a total of 50,000 serviceable square feet, your monthly cost would be $12,500. Some negatives to this model are that it can be easier to cut corners during the services. Given the set monthly price, and the typical industry production rate being roughly 4,500 square feet/hour, it should take roughly 11-man hours for work to be completed. A great janitorial servicer will spend ample amount of time to ensure the job is done right. However, lesser experienced cleaning companies can underquote at say $0.20/square foot which promotes less pay to their team just to earn extra profit (aka cutting corners).

Special Services

Special project services are more often than not priced differently. These should always be priced separately away from the regular services. One special project is window washing. Depending on the size of the pane, and if both sides are to be completed, pricing can vary. Typically, the price per pane can be around $4/pane (one side), or $8/full window if both sides are to be completed. For floor restoration services, it is mainly based on price per square feet, but varies for the flooring surface. For example, VCT strip and wax runs at about $0.50/square foot, VCT scrub and recoat is $0.25/square foot. Meanwhile, carpet shampooing can range anywhere from $0.20-$0.35/square foot depending on how heavily soiled the carpeting is.

Most Popular Commercial Cleaning Trends For 2022

In 2022, the way businesses or companies work has been changed all the way down to the basic day-to-day fundamentals. As we are in the midst of slowly but surely making our way back to some sense of normalcy, there are some new popular trends starting to emerge in the commercial cleaning industry.
Check out our list of most popular trends that we are seeing that will benefit you and your business in the coming year.


Arguably one of the most important trends to follow with your servicer. Consistency, what is it and what does it mean? To put it simply, its staying on schedule and never missing services and sticking to the scope of work properly. Maintain those high standards originally agreed upon. If a cleaner calls out, have back-up plans in place to ensure the cleaning always is completed. This will not only leave a clean and safe working environment, but establishes that ever so important trust factor and eliminates any stress or anxiety with employees.

Be Transparent

We get it, there can be a lot of confusion and uncertainty when returning back to the office. As this process takes place, whether it is all at once, or in phases, it is imperative to be briefed as the cleaning servicer on any new or updated requirements and best practices to follow. Everyone should have that peace of mind of feeling safe when returning back to work after extensive periods of working from home.

Employee Focused

Whether you are a Facilities Manager, Warehouse Manager, Property Manager, Operations Manager etc., it your responsibility to make sure your co-workers and employees have a safe working environment. Have a conversation with your employees! Ask them, what are their needs that can help outline a solid cleaning schedule, or just anything that possibly makes sense for the culture of the environment you are trying to build. Get everyone involved to help improve best practices. Some questions to ask could be:
-Are there any suggested cleaning methods to ensure additional safety (allergies to certain cleaning products etc.)? – Any tips or pointers to share? – Is the cleaning schedule currently or going to be interruptive? What is a realistic schedule to follow to prevent any decreases in productivity? -Any internal suggestions for cleaning companies/Which is the best cleaning company near me?

At the end of the day, your commercial cleaning service needs to be aware and understand your specific unique needs and pains to provide you with the best personalized service.