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Contract qustions

Discussion in 'Business Fundamentals' started by ducaticorse, Feb 4, 2013.

  1. ducaticorse

    ducaticorse PlowSite.com Addict
    from we
    Messages: 1,426

    I picked up 22 accounts this season that we have done very well with. The majority of the accounts are with one property management company, and the others are between another PM company, and privately run condo associations.

    These accounts represent a substantial amount of my SMI business, and so far we have executed flawless service, and are on track to save one company several thousand dollars on one unit alone over the previous provider.

    I would like to double the number of accounts I am currently managing next season which is entirely possible given what I was able to accomplish this year, and I can only attempt that knowing that I have these current ones locked in. I would like to sign them on a multi year deal that will ensure them continued service and me the ability to focus on gaining additional accounts and being able to plan on additional equipment/personnel etc.

    Just wondering what you people who have been in the business offer your clients as far as contracts including length of time, certain clauses, opt out, extended snow fall, ice management etc. Also, any advice on approaching the situation would be helpful too. I would like to start off with a 3 year contractual obligation, but I would be happy with knowing I have them locked for the next season, or four.

    These will all be per push in increments of four, with a two inch trigger. Salting will occur at my discretion on anything short of 2 inches. Also, wet snow and ice is a 1 inch trigger also at my discretion if I feel it needs to be scraped to prevent a messy situation.

    TIA
     
  2. hatefulmechanic

    hatefulmechanic Senior Member
    Messages: 228

    Best thing I have found for HOA's and managing companies is to offer them a financial incentive.

    Show them the numbers for what you are doing it for now, and what they typical increase per year is (I use 3-5% as a typical figure) and tell them if you want to lock the current rate in for 3 or 5 years, I will offer you x% off, etc.

    It does not give you a yearly increase, however if you put a fuel cost clause in the contract that if fuel gets over XXX/gal there is a fuel supplement added to their bill, it works out pretty well IMO.

    But it does keep you contracted in for a longer period of time, then all you need to worry about is doing the job right and keeping up your end.
     
  3. ducaticorse

    ducaticorse PlowSite.com Addict
    from we
    Messages: 1,426

    I would be all in for locking in a rate. The current rate. My salt pricing for the product I use is a steal. I could probably move a little on the plow side, but there is no room on salt. I like the idea of fuel cost, but the amount I use is so low, I wouldn't bother putting a fuel clause in at this time. (yes I know I will probably get beat up for this, but my accounts are that close together, so is my yard).
     
  4. hatefulmechanic

    hatefulmechanic Senior Member
    Messages: 228

    It's all in how you present it. "you can save 9% by year 3!"

    And yet you keep it at the same rate you are at now.

    True, it is not "adjusting for inflation" as some would say, but it does keep you from worrying about not having it in three years, allowing you to focus on your work and make them happy to renew the next time for a modest 8% rate increase ;)
     
  5. ducaticorse

    ducaticorse PlowSite.com Addict
    from we
    Messages: 1,426

    I like that Sir... Well played.

    BTW, please see my latest post in the ford truck forum titled "04 F550 drive shaft clunk".

    TNX!!