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Change is good?

Discussion in 'Commercial Snow Removal' started by big acres, Oct 24, 2008.

  1. big acres

    big acres Senior Member
    Messages: 653

    As much as I hate how ridiculously cut-throat this year has been and will be, I am optimistic that the deck will be re-shuffled in a big way when the customers get to see actual performance, or lack of, as the case may be. We were hoping for big growth, but obviously the economy isn't going to support this at decent prices, so we're focusing on servicing our customers to an even higher level an all ways. I am confident that those of us who weather the storm as professionals will emerge much stronger with many opportunities. I've seen alot of talk of guys losing longtime accounts to serious under cuts in price. Are you guys still optimistic?
     
  2. bribrius

    bribrius PlowSite.com Addict
    Messages: 1,609

    im not optimistic. everyones counting out change even if they have dollars.
    I think you might see a rise in efficiency with snowremoval. For the last few years everything has revolved around eficiency in the companies, and now the companies are beginning to expect it from the people they hire for snow and ice services. I think the bar is about to be raised even further.



    two cents.

    i just (mostly)plow resi.
    (so i get to compete with teenagers with shovels, walmart and home depot selling snowblowers, and all the other plow trucks running around.)
    I'm really not sure how the season will turn out and not sure if i even care. If the money isn't there I can stay home and watch jerry springer! THANKS DUCATI!!!
     
    Last edited: Oct 25, 2008
  3. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 8,570

    I missed Jerry today, my nap ran long.:sleeping:
    What was the show about today?...:confused:
     
  4. bribrius

    bribrius PlowSite.com Addict
    Messages: 1,609

    dunno. missed it.
    busy undercoating the truck and working on the damn plow. lol.
     
  5. hickslawns

    hickslawns Senior Member
    Messages: 619

    big acres-
    I am with you on this one. Had a former sub undercut me this week by nearly 50%. Ironic thing is I would have been paying him more than that as a sub. Point is this: People often see volume as profit. People see obtaining larger retail contracts as profit. People often do not know their incremental costs of doing business. They look at gross numbers but forget about what it costs them to run a business. Now with the trouble for some people's ability to borrow money, I think there will be some filtering of contractors. I believe without borrowing power, these people cannot buy their salt, cannot finance their equipment, and with a worsening economy they will find they will not be able to maintain their payments. I don't know how much it will happen this year, but change is coming.

    This year there has been a substantial amount of price checking following last year's extremely long winter in our area. We will all lose some, and we will all gain some. With the salt shortage, I believe the less structured contractors who might plan on purchasing salt on Dec 1 will be in for a surprise. Anyone that has gotten by the last 5-10 years by the seat of their pants business management will be forced to run a disciplined business in order to succeed. I believe my local market will bring a barrage of phone calls after the first month of plowing as contractors run out of salt or run out of capital. My game plan is to maintain existing accounts, let the others fail miserably, and continue to pursue reasonable, controlled growth. Pick and choose clients as if ripe apples on a low hanging branch on the snow plowing tree of wealth. Might work, might not. This is what capitalism is about. Risk vs. Reward. My path is calculated risk = long term reward.

    I wish you all the best of luck this year. Big Acres I am glad to see your looking at your glass as half full. May your cup runneth over with profit this season!
     
  6. ducatirider944

    ducatirider944 Senior Member
    from Iowa
    Messages: 469

    Hey, no problem, the wife picked up a case of Ramon noodles and I was able to swerve and hit a squirrel today. I'm going to try and get a rabbit tomorrow, they are good for two days of meat.

    You missed a good one Sno, I record it every day because I'm out working. It was on "my uncle and daddy are the same guy, how lucky am I?" I will send you the tape tomorrow if you have a VHS player. If don't just let me know, I will send you mine!



    The down turn of the economy is bad yes, but it also helps the guys that have made smart business decisions for the last 5-6 yrs. I have been fighting the housing market for the last 2 going on 3 years. Yep, it sucks that I can't go on vacations like I'm used to and I have to work harder, more hours, and things that I would normally pass on to make due. The bonus to fighting and struggling is you are up and running when the economy does turn, and you will get the reward for doing so.
     
  7. scottL

    scottL PlowSite.com Addict
    Messages: 1,603

    Good service and reputation for residential keeps them coming back along with some basic advertising to keep in their face. As for commercial I am blown away by some of the under cutting that has been going on. I've seen some bid lower than what it would cost them to do the job. No way could they do the job for these prices. Bottom line when they fail and they will fail the price will have a surcharge for late season contracts.

    It's simply nuts.
     
  8. big acres

    big acres Senior Member
    Messages: 653

    Hickslawns -thanks. I like your game plan. We were hoping for some major growth, and beleive or not, when we sent out proposals it was before the "Global Recession/sky-is-falling" was blasting on every medias outlet. We left our per-time and monthly alone, but actually bumped our hourly rates up!

    Everbody's also been talking about managers dragging their feet this year. I have several bids on LARGE properties with a particular co, and my inside source says corporate has not approved their budgets yet and vendors are driving them nuts. Snow season contracts start November 01here...wtf?

    Anyways, with about 30 pieces to keep rolling... as the only salesguy, I have been biting my nails -I know peoples jobs are in the balance. Finally, today the news is talking flurries on Sunday, and I had two new ones and two renewals come in, along with two requests for bid... feeling a little better, but made some last minute small price concessions on our big ones that everyone is after to keep them loyal -fingers crossed. Good luck to you as well!

    I will be selling hard well AFTER the season begins to pick-up the pieces of the guys you speak of who are not well-structured.
     
  9. smoore45

    smoore45 Senior Member
    Messages: 526

    I think the lowballer prices have always been there, but a lot of business would have the practice of "throw out the low and high bid" then make a decision. They understood, to some extent, that you get what you pay for and didn't want to be screwed over by someone that was half the price of everyone else. Now that the economy is bad, the business are willing to take the risk with the "lowest bidder" since they are all trying to save money. JMO.