The team is paid while receivables build. Test collection timing beside the active-client ramp and reserve enough opening cash for that delay. This page explains the specified case and decision, not average industry pricing or a promised outcome.
Contracts are delivered work
Each office pays a proposed $1,800 monthly fee for twelve two-hour solo visits. The eight-account ceiling requires 192 on-site hours monthly. Two paid part-time cleaners have 252 rostered hours in total, leaving 60 for travel, access, training and absence. This arithmetic still requires an evening roster.
The contract forecast starts with no clients, adds toward one new account per month through a six-month acquisition ramp, and applies 2% monthly churn to opening accounts. An account limit is delivery capacity, not evidence that eight offices will sign.
Inspect the worked case
| Measure | Scenario input or calculated value |
|---|---|
| Opening accounts | 0 |
| Target additions / month | 1 |
| Monthly opening-account churn | 2% |
| Account capacity | 8 |
| Monthly fee / account | $1,800.00 |
| Collection delay / days | 30 |
| Year 1 net revenue | $85,767.90 |
| Year 1 customer collections | $71,367.90 |
| Year 1 closing receivables | $14,400.00 |
These values belong to this fictional operating format. Rounded visit counts are monthly planning averages; they are not a promise that the actual route or peak-day calendar fits.
Revenue and collection dates differ
The model records service revenue as earned and applies 30 collection days using a monthly collection schedule. Year-end receivables represent earned service not yet collected. Payroll and operating expenses do not receive that same delay.
Do not add receivables to cash or treat a contract signature as an immediate customer payment. No deposits or annual prepayments are assumed. Purchase orders, acceptance and real payment terms can extend the wait.
Size the reserve around the ramp
The case proposes $80,000 equity, with launch spending separate from the remaining reserve. That is a scenario input, not a recommendation or evidence of committed funding. The slow account ramp and delayed collections make the minimum cash more informative than the eventual third-year profit.
Before taking on staff, obtain a realistic evening calendar and paid customer terms. Save the actual collection-delay scenario and inspect the low month; profitable work can still create a cash shortfall when receipts arrive too late.
Read profit and cash together
| Measure | Year 1 | Year 2 | Year 3 |
|---|---|---|---|
| Revenue | $85,767.90 | $176,256.00 | $179,781.12 |
| EBITDA | -$26,462.38 | $53,186.04 | $53,168.88 |
| Net income | -$33,113.30 | $38,646.30 | $38,632.73 |
| Closing cash | $13,753.37 | $56,378.33 | $98,983.97 |
The forecast cash low point is $7,871.37. Year 1 net income is -$33,113.30. Working-owner salary is included once; EBITDA excludes depreciation, interest and income tax, while net income includes the forecast depreciation and simplified tax provision. Funding is proposed, not secured. Project payback is 26.5 months in this base case and is not an investor payout.
Replace the assumption that changes the decision
Secure paid trial contracts, replay the evening roster and verify purchase-order and acceptance terms. Track days from completed service to cash; the 30-day input is not a customer commitment.
The contract fee is billed revenue, not same-day cash. Acquisition and churn determine active clients; signing a client beyond the roster ceiling creates a delivery problem rather than free recurring income.
Customer sales tax is outside the modeled service fees and cash schedule.
Texas lists home, office and window cleaning as taxable services. Review the actual billing treatment using the Texas Comptroller’s service guidance.
Review product-specific training and safety data with OSHA/NIOSH cleaning-chemical guidance. This page is a financial scenario, not a technical work instruction.
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Build from your own evidence.
Use a measured service scope, a coverage-based roster and actual payment terms. Save the revised model before interpreting the result.
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