The short answer: A small owner-operated cleaning company netting 15%, 20% on $500K revenue throws off roughly $100K, $150K in SDE for one owner. Larger janitorial firms with a manager can hit $250K+, though the owner's percentage margin falls as payroll scales. Cleaning margins are thin, small firms average ~18.8% net, because labor dominates and contracts are won on price.
What cleaning owners actually earn
Owner pay in a cleaning company is net profit plus the owner's own draw and perks, combined into seller's discretionary earnings (SDE). The catch is margin: commercial janitorial runs 20%, 40% gross, but wages, workers' comp, supplies, and insurance compress that to 10%, 24% net, averaging about 18.8% for small firms. Revenue is relatively easy to add; margin is the discipline.
Owner earnings by revenue band
| Annual revenue | SDE @ 15% | SDE @ 22% | Profile |
|---|---|---|---|
| $250,000 | $37,500 | $55,000 | Owner-operator, small route |
| $500,000 | $75,000 | $110,000 | Owner + crew, few contracts |
| $1,000,000 | $150,000 | $220,000 | Manager in place, multi-account |
| $2,000,000 | $300,000 | $440,000 | Multi-crew regional operator |
Note the range within each row, the difference between 15% and 22% net on $1M is $70,000 of owner earnings, almost entirely a labor-efficiency story. From 2021 to 2025, median janitorial revenue rose 25% but median SDE rose only 17%, confirming that margin, not revenue, is the constraint.
In cleaning, you don't win on price. You win on retention and route density.
Building SDE: the add-backs
- Owner's salary / draw, added back, then a replacement wage considered if you'll manage rather than clean.
- Owner perks, vehicle, phone, fuel, a spouse on payroll.
- One-time costs, equipment purchase, a lost-then-replaced contract, legal fees.
- Interest & depreciation, removed to show operating cash flow.
Don't add back real labor
If the "owner" is also a working cleaner, the value they provide must be replaced with a hired wage. Adding back a working owner's labor without deducting a replacement inflates SDE and overprices the deal.
How earnings become a purchase price
| SDE | Price @ 2.30× | ~10% SBA down |
|---|---|---|
| $75,000 | $172,500 | $17,250 |
| $120,000 | $276,000 | $27,600 |
| $220,000 | $506,000 | $50,600 |
Assignable multi-year contracts and low customer concentration push the multiple toward the top of the 2.0×, 3.5× range; a book of 30-day-cancellable accounts pushes it down. Run your target in the valuation calculator and check live comps on the cleaning multiples page.
See what that SDE is worth
Plug in earnings and a multiple to get a price and down payment.
Frequently asked questions
A small owner-operated company netting 15%, 20% on $500K revenue produces ~$100K, $150K of SDE. Larger janitorial firms with a manager can hit $250K+, though the owner's percentage margin falls as payroll scales.
Small commercial cleaning firms average ~18.8% net, typically 10%, 24%. Operators protect profit through route density, recurring contracts, and tight labor management.
Labor dominates and commercial contracts are won on price, so 20%, 40% gross compresses to 10%, 20% net after wages, workers' comp, supplies, and insurance. Service quality and route efficiency keep more.
Price is SDE × about 2.3× (near 0.7×, 0.8× revenue). $120,000 of SDE is worth roughly $276,000. Assignable multi-year contracts and low concentration raise the multiple.
Sources
- Cleaning/janitorial earnings, margins & multiples, BizBuySell Valuation Benchmarks (2025).
- Net profit margin data, CleanerHQ (2026).
