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27 locations...what would you do?

Discussion in 'Commercial Snow Removal' started by Mick76, Aug 29, 2011.

  1. Mick76

    Mick76 2000 Club Member
    from Maine
    Messages: 2,157

    I've got the opportunity to bid 27 locations..... of which I Know the DM and he assured me that If I could service all of therm they would be mine (provided the price is right of course) They only want one vendor (I'm starting to sound like a national for petes sake!) .... they're spread out about 90 miles....my delima is I could service about a 3rd of them now with my trucks (the lots are under 1/2 ac each) about 30 minutes plus travel time per lot.... would you buy more equipment or sub the rest out? I know the depreciation factor should I buy more equipment but I don't know if I want to invest that kind of cash now.... I guess its a good problem to have...your thoughts?
     
  2. CGM Inc.

    CGM Inc. PlowSite Veteran
    from Ontario
    Messages: 3,589

    sub it out, you lose them after the winter and you will be stuck.
     
  3. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Enjoy being a National! I never could understand companies that want a plow company to cover a huge area. Needs to be broken up some you have 3 guys working their area and will know if it's snowing or not.You said they only want one company,so can you hire subs to do the work then create one invoice to send out.
     
  4. 2COR517

    2COR517 PlowSite Fanatic
    Messages: 7,115

    I would give that account some careful thought. You've worked very hard to build a great reputation. Can you really service these accounts with the same effort and quality of work? The quality they are expecting?
     
  5. Rc2505

    Rc2505 PlowSite.com Addict
    Messages: 1,245

    Anyway you look at it, all I see is problems. If you sub out 2/3rds of the lots, you have to find dependable honest subs. If one of those subs doesn't preform, you have to have back-ups in place, or travel to them and do them yourself. If you keep it all in house, then you have to purchase equipment, hire drivers, and maintain a fuel bill that will rival then national debt. The time you are paying employees will not be productive, with 3/4 of it in travel time per storm. So my suggestion would be if you think you can handle the subs, and find good subs, then bid the job. Otherwise pass on it and forget it. It doesn't sound like explaining the logistics to the DM will do much good.
     
  6. JDiepstra

    JDiepstra PlowSite.com Addict
    Messages: 1,780

    Im with the guys seeing red flags
     
  7. CGM Inc.

    CGM Inc. PlowSite Veteran
    from Ontario
    Messages: 3,589

    x2 :drinkup:
     
  8. Mick76

    Mick76 2000 Club Member
    from Maine
    Messages: 2,157

    CGM, it would be a 3 year deal

    grand view, I was thinking 4 routes maybe 5 in the heavy events

    2cor, pm sent "Can you really service these accounts with the same effort and quality of work?" I can but the question is are they willing to pay for that service? I'll have to find out....

    RC, those are the exact problems I have swimming in my head!
     
    Last edited: Aug 29, 2011
  9. cet

    cet PlowSite Fanatic
    Messages: 7,202

    Bid it high enough to pay your subs well. A well paid sub will always show up for work.

    I will admit 90 miles is more then I would like to tackle. My stuff is all close by. I have 8 subs, 1 has been with me 15 years, some are new and always looking for more work. If you pay a little better then average you shouldn't have problems.
     
  10. Brian Young

    Brian Young PlowSite Veteran
    Messages: 3,382

    Holy crap Mike, your a miniature national! I don't know man, we service both ends of our city and its about 15 miles from one end to the other and even in moderate storms its tough to get things done in time. We added another truck this year but some of the customer's expressed "concerns" last year so we'll see how it goes in a couple weeks come renewal time. If you were serious about taking them, I would look for a couple established, dependable companies to help you out miles away.
     
  11. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    If something happened and you lost them,what do you have left for yourself?
     
  12. Mick76

    Mick76 2000 Club Member
    from Maine
    Messages: 2,157

    This would just add to the bottom line.... i still have all my old accounts with multi year deals.......I don't "need" this account but would be nice to grow... but its got many headaches......
     
  13. cold_and_tired

    cold_and_tired PlowSite.com Addict
    Messages: 1,246

    I had a deal like that three years ago. I serviced 21 gas stations plus my typical six medium commercials. I took two of the gas stations that were near me and subbed out the others. Anyway, one year of that was enough for me. My sub did a great job but I was always worried and the paperwork had me swamped. Everything worked out that year but the mental toll was too much. I passed on them the following year.

    Like others have said, would you still get the job done if one of your subs quit mid storm?
     
  14. iceman1

    iceman1 Sponsor
    Messages: 183

    take them and take care of your subs if you can handle the growth. A sub will be willing to do this if you pay them well and pay them quick. When I say quick I mean make sure you have the cash flow to pay subs for 3 good size events before you get paid. If you can pay good and pay quick you will have every sub wanting to work with you. Do not get money hungry pay your sub at least 80%. Use your connection and make the sale!!!! It is about who you know.
     
  15. forestfireguy

    forestfireguy PlowSite.com Addict
    Messages: 1,276

    Mick,

    PM Me, I did something like this in the past couple years. I have some insight which may be helpful.

    If there's one piece of advice given above which you should heed, it's take care of your subs. Pay on time no matter what, have an "SOP" for them in black and white. Make sure your admin is up to the extra workload of billing these sites and set strict penalties for occasions when subs hold up your paperwork.