How much to charge for pool cleaning: a simple pricing method

Why cost-plus pricing beats guessing

It is tempting to copy what other pool services in your area charge. Their prices hide their costs, though: a different route density, vehicle, insurance or pay rate can make the same price profitable for them and a loss for you. Undercharging is also hard to see week to week. It shows up at the end of the year as long days and not much left over.

A cost-plus price starts from your own numbers. Once you know your cost per stop, you can decide where to compete, which customers to take on and when a price rise is needed.

Step 1: Time on site and travel

Time is the biggest cost in most pool service businesses. Measure it rather than estimating it.

• Time on site: how long a typical stop takes for each kind of pool, including testing, cleaning, recording and talking to the customer.
• Travel: the average time and distance between stops on your route, not from home to the first stop only.
• Labour rate: the hourly amount that covers what you pay yourself or your technicians, plus on-costs such as insurance for employees.

Do not forget admin time. Invoicing, chasing payments and answering messages are real hours that each stop has to pay for.

Time also sets your ceiling. Multiply the stops you can realistically do in a day by the days you work in a year, and you have the most stops you can sell. If your price multiplied by that number does not cover your pay, costs and profit, the price is too low or the route is too spread out, however busy you feel.

Step 2: Chemicals

Chemical use varies a lot between pools, so decide how you will charge for it. Many operators bill chemicals separately at recorded cost plus a markup, so heavy-use pools pay their share. Others include a chemical allowance in a flat price, which is simpler for the customer but needs regular review.

Either way, record what you add at every stop. Pool size drives chemical use, so a known volume helps: our pool volume calculator works it out from the pool’s shape and depth.

Step 3: Overheads

Overheads are the costs you pay whether or not you do a stop today: vehicle running and finance, insurance, phone, software, equipment, accounting and marketing. Add up a year of overheads, then divide by the number of stops you expect to do in that year. That gives an overhead share per stop.

Step 4: Margin and GST

Margin is the profit you keep, as a share of the price. To build a price from cost with a target margin, divide your cost by one minus the margin. For a 25% margin, divide by 0.75. Markup is different: it is profit as a share of cost, so a 25% markup gives a lower price than a 25% margin.

If you are registered for GST, add 10% to your price before GST. When you advertise or quote prices to homeowners, the ACCC expects the total price shown as a single figure, including GST and any unavoidable fees. Prices shown only to other businesses do not need to include GST.

Worked example (made-up figures)

The figures below are invented to show the method. They are not market rates or a recommended price. Use your own costs.

In this example, chemicals are added to each invoice at recorded cost plus a markup. If you include chemicals in the price instead, add your average chemical cost per stop to the total cost before applying the margin.

Pricing structures that work

• Per stop: simple to explain and fair when frequency changes through the year.
• Monthly flat fee: predictable for the customer and for your cash flow, as long as you review it when frequency or chemical use changes.
• Minimum charge: protects you on quick stops and small one-off jobs.
• Separate jobs: price one-off work, such as a green pool clean-up or equipment repair, as its own job rather than absorbing it into a regular stop.

Review prices at least once a year and whenever a major cost such as fuel, chemicals or insurance moves. Give regular customers notice before a new price takes effect.

Keep checking your numbers

A price is only as good as the costs behind it. Track your actual time on site, chemicals used per pool and revenue for each hour worked, and compare them with your assumptions every few months. Chlor’s reports show completed stops, time on site and revenue, and its invoicing carries recorded chemical costs onto each invoice.