How to Calculate & Boost Your Pool Cleaning Business Profits

Are Pool Cleaning Businesses Profitable?

Absolutely, pool cleaning businesses can be profitable. According to Springboard, a pool company owner's average yearly net income is between $80,000 and $100,000.

Unlike seasonal businesses, pool service companies enjoy year-round demand. This is because swimming pools require regular maintenance, cleaning, and occasional renovation, regardless of the season.

This consistent demand creates recurring revenue, increasing profitability. That’s why the pool cleaning industry is expanding yearly.

IBISWorld, a market research firm, values the United States pool cleaning industry at $7.2 billion. It has grown at a CAGR (compound annual growth rate) of 2.8 percent in the five years to 2024.

Furthermore, Business Research Insights projects the global pool cleaning market to be worth $2.73 billion by 2027, increasing at an annual growth rate of 13.28 percent.

However, an individual pool cleaning company's profitability hinges on several factors.

What factors can affect a pool cleaning business’s profitability?

Here are key factors that determine a pool cleaning company's profitability:

• Local economics: Areas with many pool owners generally create more pool service work orders, increasing revenue. 

Also, homeowners in regions with high living costs tend to have ample disposable income, allowing you to offer your services at higher rates. They are also more receptive to paying for a premium service like pool maintenance.

• Unexpected events: When faced with unforeseen events like natural disasters or global health emergencies like COVID-19, customer priorities change, and commercial pool usage reduces. This can decrease the demand for pool service providers, lowering profitability.

Unexpected events also increase overhead, such as material costs. For example, the price of pool chemicals like chlorine has surged since the pandemic. Such increases in the price of materials erode a pool service company’s bottom line. 

• Amount of competition: Operating in an area where the number of competitors exceeds the number of pool owners lowers revenue. It also increases your operating costs since you'll have to spend more on discounts and marketing campaigns to grow your customer base.

• Quality of service: Delivering quality service generates organic referrals. It also gives you a positive reputation that attracts potential customers. This helps to generate revenue and grow your bottom line.

• Daily job closure rate: Increasing your daily job closure rates helps you serve more customers and have sufficient time to take on new customers, potentially boosting your profitability.

How Can You Calculate The Profits of a Pool Cleaning Business?

Three key financial metrics measure profitability: operating, gross, and net profits. Each has its respective formulas and financial ratios.

For example, pool company X generates $600,000 in revenue while incurring $100,000 in service costs, $200,000 in operating expenses, and $50,000 in taxes and interest owed.

Here's how to compute company X's operating, gross, and net profits.

Operating profit

Also known as earnings before interest and taxes (EBIT), operating profit is what’s left after accounting for all business expenses—except interest and taxes—from your total revenue. The business expenses include:

• Operating expenses or overhead: The amount you spend running the business. Examples include rent, business insurance, amortization and depreciation of assets, and energy bills.

• Cost of services: Expenses incurred when delivering your services. Examples include salaries, contractor wages, and material costs.

Here’s the formula for calculating operating profit.

Operating profit = Revenue – (Cost of services + Operating costs)

Therefore, company X’s operating profit is:

$600,000 – ($100,000 + $200,000) = $300,000

Another useful formula is the operating profit margin, which indicates the percentage of revenue you convert into operating profits. The formula is:

Operating profit margin = (Operating costs + Cost of services)/Revenue x 100

Per this formula, company X’s operating profit margin becomes:

$300,000/$600,000 x 100 = 50%

Gross profit

This is the amount remaining after subtracting the expenses tied directly to delivering your services—i.e., the cost of services. 

Gross profit excludes taxes, operating costs, interest payments, and income generated from other investments. Here is the formula.

Gross profit = Revenue – Cost of services

This means that company X’s gross profit is:

$600,000 – $100,000 = $500,000

A financial ratio calculated using gross profit is the gross profit margin. It measures your company’s ability to generate gross profit for each revenue unit. The formula is:

Gross profit margin = Gross profit/Revenue x 100

For example, here’s company X’s profit margin.

$500,000/$600,000 x 100 = 83.33%

Net profit

Net profit, often called the bottom line or actual profit, is the true measure of your business's profitability. After subtracting all expenses, including taxes and interest payments, it is the money remaining from your total revenue. The formula is:

Net profit = Total sales revenue – Total expenses (cost of services + operating costs + taxes and interest)

Therefore, company X’s net profit is:

$600,000 – ($100,000 + $200,000 + $50,000) = $250,000

When expressed as a percentage ratio of your revenue, net profit becomes the net profit margin, given by:

Net profit margin = Net profit/Revenue x 100

This means company X’s net profit margin is:

$250,000/$600,000 x 100 = 41.67%

Now, let's explore how to increase each financial metric to boost profitability.

How Can You Boost The Profits of Your Pool Cleaning Business?

Here’s a breakdown of how to generate more revenue and boost your company’s profits.

1. Price your pool cleaning services the right way

Attaching the right monetary value to your services is a major way to boost profitability. This process involves finding the right amount to charge for your services, considering the going market rates, and your target market’s disposable income and willingness to pay.

Your pricing significantly affects your ability to compete favorably with other pool cleaning companies, attract new customers repeatedly, inspire trust, and stay profitable. Therefore, it’s crucial to price your services fairly.

Here’s how a new pool cleaning company can create a profitable pricing strategy:

• Discover what competitors are charging. You can check their social media pages and website or call their service line.

• Determine your overheads, cost of services, and cash flow from your financial records. If you’re a new business, use estimates captured in your business plan's financial projections, including business license expenses and other startup costs.

• Choose an appropriate pricing method—flat, hourly, or hybrid. Evaluate each method’s pros and cons and pick one that aligns with your situation.

• Set your profit margin. You can do this by dividing net income by net sales.

• Review prices to adapt to evolving customer sentiment and market conditions.

Pro tip: Avoid using low prices as a value proposition when breaking into new markets. Doing so can attract low-quality customers who consistently churn, making it difficult to establish sustainable profitability in the long run.

2. Create a marketing strategy

A marketing strategy is a long-term plan for attracting potential customers. It can also help build your company’s local brand awareness and online presence, potentially making you your customers’ first choice.

Developing a marketing strategy involves selecting the proper marketing channels, allocating an appropriate budget, creating an execution plan, and tracking performance.

Here are marketing channels pool cleaning businesses use to attract local pool service leads and boost their earning potential.

• Email marketing: Promote service offerings and send educational content to new and existing customers using email. To achieve greater results, personalize your content to each customer. 

You can use ServiceTitan’s Marketing Pro – Email platform to segment your customer base, design emails, and set up email sequences tailored to each customer’s needs.

• Direct mail: Distribute promotional materials like postcards and free price quotes to prospects’ doorsteps. ServiceTitan’s Direct Mail software allows you to design postcards using attractive templates, manage your campaign, and deliver hyper-relevant mail to customers.

• Local Services Ads: Run Local Services Ads (LSAs) to appear at the top of search engine result pages and empower prospects to contact you directly. 

Consider using ServiceTitan’s Direct Mail platform to eliminate missed LSA bookings and to seamlessly pull all work orders directly from your LSAs into your ServiceTitan dashboard. 

• Listing in local directories: Register in local directories such as Home Advisor, Google Business Profile, your local chamber of commerce website, etc.

• Yard signs: Place yard signs at intersections, bus stops, and other areas with heavy foot traffic.

• Social media marketing: Register and grow your social media presence. Use it as an opportunity to portray your brand personality using memes, before-and-after transformations, employee highlights, etc. Also, engage with your target audience by responding to brand mentions, comments, and industry conversations.

Tracking your results allows you to measure their effectiveness and optimize your strategy for maximum ROI. That’s where ServiceTitan’s Home Services Marketing platform comes in handy.

It tracks each campaign’s revenue, attributing each customer call to the source campaign.

It also ranks each campaign by revenue generated, presents performance data insights using an intuitive dashboard, and identifies zip codes generating the most calls.

These data insights can help you avoid wasting marketing resources on non-performing campaigns, protecting your bottom line and increasing profits.

Pro tip: Consider purchasing pool routes to expand your customer base quickly.

3. Generate recurring revenue

One-time pool repairs only generate short-term profits. They also require spending to attract more customers, increasing your marketing budget and reducing profits. 

Conversely, repeat customers generate a consistent and predictable cash flow, become loyal ambassadors, and outspend new customers by 67 percent.

Also, investing in growth is easier when generating a steady and predictable cash flow from recurring revenue sources.

Here’s how to generate recurring revenue:

• Offer bundled packages. For example, you can bundle chemical balancing, water testing, filter cleaning, and equipment inspections into one package.

• Create membership programs (or service contracts).

• Reward employees for selling memberships and bundled packages. You should also train them to explain to customers the potential time and cost savings associated with memberships.

Consider using a membership management tool like ServiceTitan's Service Agreement platform to easily create and monitor your membership programs.

The platform has several templates for creating service contracts customized to the customer’s unique needs and containing key details such as contract duration, billing frequency, and pricing.

ServiceTitan’s Service Agreement platform also creates and displays a profitability report highlighting each job's labor and material costs. This ensures you remain profitable while offering memberships.

The platform also lets you automate renewals to sustain recurring revenue streams. 

Pool service business owners using ServiceTitan’s Service Agreement software avoid the hassle of using unwieldy systems like spreadsheets and notepads, freeing up time to focus on growth.

4. Reduce costs when possible

Cost reduction involves actively cutting unnecessary expenses that bloat your budget and reduce profits. 

While they help, temporary cost reductions caused by government policies or improved economic conditions offer only short-term relief, not true cost reduction.

So, employing cost-reduction strategies that don’t diminish your service quality or job-closure rate is essential.

Here are some sustainable ways to reduce costs:

• Automate repeated tasks and business operations to reduce labor costs and increase efficiency.

• Secure favorable prices from suppliers by negotiating discounts and cost reductions.

• Opt for a smaller office space to reduce utility costs.

• Empower some employees to work remotely.

• Outsource menial office tasks to boost productivity.

5. Offer additional services

Offering extra services such as pool equipment repair, winterization, spring opening, and algae eradication treatments can help pool service companies generate more profits. 

It allows you to cater to a broader range of customer needs, build customer loyalty, showcase your expertise, and justify premium pricing for these specialized services.

Aside from expanding your service offering, upselling and cross-selling customers on relevant pool care products and services is a powerful way to maximize profits.  

For example, after cleaning a pool, you could recommend a more advanced filtration system to improve water quality or a test kit for checking chemical levels.

Hire certified pool technicians to handle specialized pool maintenance or repair services to expand your service offering. Also, consider offering financing options to minimize price objections.

ServiceTitan’s Customer Financing platform empowers technicians to display different service tiers, highlighting how much customers will save with financing.

Due to the platform’s integration with key industry-leading finance companies like GreenSky and GoodLeap, customers can receive immediate approval without submitting numerous documents.

ServiceTitan’s Customer Financing platform also allows you to tailor financing options to each project’s unique characteristics, ensuring your bottom line remains safe.

This streamlined approach powered by the Customer Financing platform empowers technicians to sell confidently in the field, generating more revenue and boosting profits.

6. Provide a superb customer experience

Delivering quality service is one way to attract and retain repeat customers and grow your net income.

Delivering quality service also encourages customers to refer you to others and leave positive reviews online, attracting more customers and increasing revenue.

Improving customer service consists of two interdependent pillars: training employees to be customer-focused and streamlining customer interactions.

Firstly, for employees to be customer-focused, CSRs should answer customer calls after three to five rings, technicians should always arrive early, and you should always try to remediate customer complaints.

Secondly, streamlining customer interactions involves investing in the right tools that allow customers to contact you directly and access job updates.

For example, a former programmer who’s currently a pool cleaning company owner uses electronic spreadsheets to streamline customer communications. Here’s how it works:

• He inputs testing data, chemical amounts, and other maintenance details into the spreadsheet. 

• The spreadsheet calculates the amount of chemicals the pool needs.

• He emails it to the client, allowing them to have a record of their pool's maintenance history.

However, creating such a system can be daunting for non-technical business owners. Furthermore, it’s not sustainable and doesn’t communicate other crucial information like technician arrival times.

That’s where ServiceTitan’s Customer Experience software comes in handy.

It empowers customers to contact you via SMS and track technicians’ exact location using GPS technology.

The platform also allows field technicians to access all customer data, service history, and property information from their mobile tablets, allowing them to focus wholly on the job instead of frequently calling the office.

ServiceTitan’s Customer Experience platform also offers:

• Automated alert creation: Notifies you whenever employees perform specific actions.

• Sales opportunity discovery: Helps you track sales opportunities, ensuring employees follow up on each.

• Customer notifications: This tool lets you send appointment reminders, job updates, survey requests, and question replies to customers. This transparency and proactive communication strengthens customer relationships.

7. Identify areas for improvement

Growing a business requires continuous improvement to adapt to evolving market conditions. That’s why it’s crucial to regularly track your business to discover revenue inefficiencies and cost reduction opportunities to protect your bottom line.

Continuous monitoring also delivers accurate data insights to guide you in making the right decisions.

Given the importance of tracking the right metrics for continuous improvement, ServiceTitan created its Field Reporting software.

This home service business monitoring platform allows pool business owners to monitor revenue growth across date ranges, transaction data, and employee performance using default and custom dashboards.

You can also access real-time performance metrics from anywhere worldwide, as the platform is cloud-enabled. Its integration with the cloud also lets you view the latest data to make informed decisions and optimize your pool service operations.

ServiceTitan’s Field Reporting software empowers you to optimize business operations for profitability and scale without necessarily staying in the office.

This lets you focus on strategic planning and client relationships, which grows your business, instead of getting lost in managing the day-to-day operations.

Pro tip: Use ServiceTitan’s Service Business Grader to measure your company’s health status.

8. Manage inventories more effectively

Pool service companies can boost their profitability by managing their inventories more efficiently. 

This helps you avoid overstocking and material decay, unlocking valuable capital for scaling your services. It also facilitates proactive maintenance of pool cleaning equipment and ensures the right tools and materials are always available.

This prevents downtime, maximizes technician productivity, improves job closure rate, and increases revenue.

ServiceTitan’s comprehensive pool cleaning software has an Inventory Management platform that automates inventory management and seamlessly integrates with other business processes, such as scheduling and dispatching.

The platform has an Overview Section that gives you a one-look view of the state and quantities of all available materials, tools, and equipment. You can also drill into each item to discover how many times it’s been used, who used it, and where it was used.

ServiceTitan’s Inventory Management platform also has an inventory workflow that sets off a chain of events whenever a technician adds an item to a customer’s invoice from the mobile app.

First, the system automatically adjusts your replenishment schedule to account for the used item. Immediately that’s done, ServiceTitan’s system will send you a purchase order notification to ensure you replace the item.

This helps ensure essential tools such as skimmers, filter cleaners, and algae brushes remain at optimum stock levels. It also helps you monitor inventory conditions, minimizing repair costs.

9. Serve more customers

Maximizing employee efficiency to complete more jobs daily and serve more customers can increase your revenue. 

In the long run, a company with five technicians efficiently completing three jobs daily might be more profitable than one with ten technicians handling just one job each.

However, while maximizing employee efficiency to serve more customers is important, you should avoid overworking employees to prevent burnout and ensure technicians can consistently deliver high-quality service

Here’s how to sustainably boost employee efficiency:

• Offer competitive labor rates and bonuses.

• Reward employees with public recognition and bonuses for exceeding and maintaining productivity standards.

• Create checklists and workflows to guide recurring tasks and routine activities such as invoicing, chemistry balancing, and pool skimming.

• Ensure customer data is easily accessible by digitizing intake call information, work forms, and job-completion surveys.

• Use route management software to optimize scheduling and dispatching.

ServiceTitan’s Scheduling and Dispatching platforms help pool cleaning companies boost their technicians’ productivity.

The Scheduling platform lets dispatchers track each technician’s location in real time and view their job progress without calling. This real-time monitoring capability allows dispatchers to schedule jobs proactively, considering technicians’ current workload and availability.

The platform’s at-a-glance calendar empowers dispatchers to schedule jobs weeks and months ahead, flagging and strategically matching appropriate technicians to jobs requiring particular expertise. 

This way, technicians assigned to special jobs have the technical expertise, language proficiency, and professional demeanor to handle such jobs.

ServiceTitan’s Dispatching platform allows customers to confirm appointments using text messages, which automatically reflect on their dispatch boards and job records. This saves time spent on confirmation calls and minimizes no-shows.

10. Empower your pool technicians and CSRs

Empowering employees involves training and providing the right technology to automate processes, which boosts their productivity and efficiency.

The benefits of empowering employees with the right tools also go beyond automation. Modern tools offer many features designed to empower technicians to close more deals in the field while eliminating the time spent manually crafting sales pitches.

For example, ServiceTitan’s Field Service App allows technicians to create service tiers on-site and display them to customers on mobile tablets using a display resembling traditional shopping apps.

This display hands over control to customers, allowing technicians to close deals quickly without sales pitches.

Another ServiceTitan tool you can use to empower employees is the Call Booking software, which enables CSRs to review each customer’s property data to spot potential upsells.

The software also allows CSRs to record incoming calls so they can review them later to identify areas for improvement, coach new CSRs, and ultimately, close more deals.

Recommended read: Discover how ServiceTitan’s staff helped Sabrina Lesperance of Clear Tech Pools in St. Petersburg, Florida, integrate ServiceTitan throughout their company to boost efficiency.

Over to You

Implementing these tips empowers you to optimize your business and grow your profits.

Invest in marketing strategies, prioritize generating recurring revenue, and track business performance metrics to identify resource waste early.

However, to achieve sustainable results over a long period, consider boosting employee efficiency and productivity with pool cleaning software like ServiceTitan.

ServiceTitan is a comprehensive cloud-based software designed to help home service businesses automate key business operations and boost revenue generation. Over 100,000 contractors nationwide trust the software.