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Contract, wants money back???

Discussion in 'Commercial Snow Removal' started by PROCUTSLAWNCARE, Jan 21, 2007.


    Messages: 110

    My biggest contract wants me to credit them $2,000 dollars next year because we have had a light winter so far. I told him it's not my fault it has not snowed and when Im here 3 times in one day, do I charge you more money? NO! What do you guys think I should do? This is my biggest plowing account and they are on a monthly contract, so I really do not want to lose them. Thanks.

  2. Elwer

    Elwer Senior Member
    Messages: 135

    Wait to see what we get for the rest of the winter and go from there....who knows we may get some weather like the lucky ones out west are getting:realmad: and if you credit him some money, it may cost you later!!!
  3. GrandScapes

    GrandScapes Senior Member
    Messages: 189

    Offer them a 1 plow discount next year. I dont know what you base your contracts on (how many pushes) but that will be a fair deal to them next year and then the following year you will be able to raise it back up. If its a good enough size contract, you will obviously wanna do what you can to keep it. Let them know that the winter is not over yet either. :)
  4. ppandr

    ppandr Senior Member
    Messages: 619

    Tough spot....but I would approach it by setting standards for upcoming years so that in years of excess snow he will have to pay more. If he is not willing to do so than I would tell him no, finish out your contract for this year and move on......Theres more than enough snow work out there that actually pays
  5. ThisIsMe

    ThisIsMe Senior Member
    from Mass
    Messages: 745

    Tell him that when his insurance company refunds some of his premiums for not having an accident or claim last year, then you will do the same. :)
  6. LwnmwrMan22

    LwnmwrMan22 PlowSite Fanatic
    Messages: 27,862

    I've had 2 contracts quit now this year, or at least inform me that they won't be back next year unless I switch to a per push price.

    I tell them, sorry, I don't do per push / per inch / per hour.

    Even if it is your biggest account, unless you're going to lose your house over it, I'd not sweat it, 2 more will come along that will fill it's place.

    You'll have more work than you know what to do with.

    Trust me, it's taken me 10+ years to figure this out.

    Like you said, it's not your fault.... that's the gamble everyone takes.

    I lost a third account last spring, because I wouldn't do a spring cleanup for them in April, even though they hadn't commited to a new yearly contract yet.

    They said since we didn't have any snow in April, that I should have done the spring cleanup instead.

    I said no, that was not included in the yearly contract price that they signed up for, from May through April.

    How did your client come up with an amount of $2,000?
  7. Superior L & L

    Superior L & L PlowSite Veteran
    from MI
    Messages: 3,035

    **** them people. Ask them if it would have been ok to bill them extra if we had a bad winter. I dont think so!
    Last edited by a moderator: Jan 21, 2007
  8. magnatrac

    magnatrac PlowSite.com Addict
    Messages: 1,055

    Thats like trying to talk down the gas station owner after filling your tank! I was getting worried about the same problem happening to my company. Winter has finally showed up to michigan so people are not as concerned. I always have a mix of per push and seasonal accounts. This year the per push accounts are ahead, but normally they and up losing. We keep pretty good records of what we do all winter for billing. If any one questions what services they are getting for there money we can show the how many times they were serviced in the past. It will usually avaerage out with past seasons. Most people understand this once it is expained. If your customer agreed to a contract hold them to it. If you lose them over that then they were not worth having in the first place. I have left customers in the past because they wanted to talk numbers after the fact. With our long term customers we will work with them to a point. In a real slow winter if a seasonal job jet more that 6" we will let the extra charge go. If you give too much they will come to expect it, and then your working for free. It is still only january and alot could still happen. I would say it is way to early to start talking about refunds.
  9. carl b

    carl b PlowSite.com Addict
    from Ohio
    Messages: 1,330

    this is the best answer!!!
  10. Oshkosh

    Oshkosh PlowSite.com Addict
    Messages: 1,655

    They cannot have it both ways...

    If you cave you might as well plow for free....
    I agree with the above comments... maybe a different contract for next season with a added charge for return trips over a certain amount so you don't loose if you get hammered....Then you could lower you initial contract price...kind of sucks for you....
    Would work out to be a combination between per push and seasonal at that point......
  11. Crash935

    Crash935 2000 Club Member
    Messages: 2,377

    You have to remind him that by going with a seasonal contract that both of you are playing the odds against the amount of snow you will get. Youre hoping that it snows less than the base average to come out ahead and hes hoping for more so that he feels like he really got his $$'s worth. If you have been plowing him for a few years, go back through your records and show him (hopefully) that there was a season or 2 where he came out ahead and you didnt ask for any more $$ and ask to to wait until the season is over before either of you discuss any type of refund or increase. History shows that when we finally get snowfall late into the season that the season ends up running later into spring.
  12. Stone Mountain

    Stone Mountain Member
    Messages: 45

    I have had the same sort of thing in the past. One year, I gave them a 10% discount. We agreed that if the following winter was much heavier, they would pay me extra. Of course, they didn't (these people were stinking rich, but to them $100 was like $1000 to me.
    IF you agree to a discount, Make sure that you GET next year's contract first, then write it on a cumulative basis.
    In other words:tracts are the average yearly snowfall in number of inches or number of events for the last x number of years is so much. This year was so much. therefore, if next year is so uch, the extra cost is so much.
    If they won't go for that, I say no discount and take your chances.

    What customers forget is that we don't get a discount on our trucks, blades, or insurance or standby fees to drivers if there is less snow. We have to spend that money regardless.
    Here in Toronto, most contracts are seasonal, so all we really save is gas and some salt.
    Next year, if the amount of snow doubles, I don't get extra, so no discount.

    X-LOWBALLER Senior Member
    from Toronto
    Messages: 102

    HELL NO!

    Like the other poster said, If it snowed 2ft per day, per hour for a week straight, could you ask for more money? Ask them that question and if they answer no, then you have your answer. If they answer yes, offer the discount and add it to their contract next year to make up for the loss. With snow, you cannot lose. There will be snow and there will be lots of it.
    A discount????? I wish I had a customer ask that of me. I have had a few mention that we have had a light winter, I agree and explain that it's definetly not normal and with the 2 months of mild weather, we are making up the loss of last year. I always make my customers think that our company is barely scraping by. CRY POOR, it works.
  14. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    Ok. Let's look at this a different way. With a seasonal contract, they are saying they want certain conditions met for a certain period of time - ie: They don't want any snow build-up on thier property from Nov 1st to Apr 1st. You are agreeing to meet these conditions. HOW you do that is up to you. It may be by plowing or it may be by letting nature take it's course. YOU have met your obligation by nature - getting no snow. Have they met thier obligation (to pay you a certain amount)?

    As a side note: I'd like to go to the dealer where I bought my plow and want some of my money back since I didn't get to use it as much as I expected when I paid for it. Amounts to the same thing.
  15. nsmilligan

    nsmilligan PlowSite.com Veteran
    Messages: 704

    Tell him you give him the same discount that his insurance company is giving because of the reduced liability of slip and falls, or the reduction in your bank payments because it's been a slower winter. A contract is a contract.

  16. diehrd

    diehrd Senior Member
    from NY
    Messages: 199

    This is exactly what you want to avoid in a client.NEVER sell the above deal,and if a client views your service with that idea do not take them on , if you do never consider that income as anything more then a 1 time or bonus client.

    Our services is best sold as insurance type of work.If you do not sell that way you are in trouble,,I have plowed only 3 times this season,I live in Rochester NY where we usually get hammered..I have gotten several calls from clients thanking me for being so prompt when it does snow and that I am the best plow company they have had in years.

    Remember I plowed 3 times I could have done it with a leaf blower LOL..BUT like an insurance claim I am on the job like white on rice just as they would expect if there car was damaged in an accident.

    We do not sell the odds.or awin lose service..WE sell piece of mind. . . . prsport
  17. mayhem

    mayhem PlowSite.com Addict
    from Peru MA
    Messages: 1,016

    So do you and this customer have a contract or not? Does the contract specifiy that you will refund money in the event of a light season or charge extra during hevay seasons?

    What is his business? There are dozens of analogies available, likely one will fit this situation perfectly.

    If you have an extended warranty, can you get a refund at the end of the term if your widget doesn't break?

    Can you get a refund on your car insurance if you don't have an accident?

    Can your homeowner's insurance be refunded if your house doesn't burn down?

    A contract is a contract. If he bails you'll get another customer.
  18. LINY Rob

    LINY Rob Senior Member
    Messages: 478

    he is a monthly account, everyone is saying to finish up this year and let him go elsewhere.

    He is MONTHLY, and his biggest account. If he tells that guy to shove it he does not have the luxury of 2-3 more customers calling him THIS season.

    Do what it takes to make the guy happy because he is the one paying the bills.
    Try to work something out thats good for the both of you, I would like to think it would be hard for him to find someone else to plow him the rest of the winter but with things so slow everyone will be answering thier phone and he will probably make a per-push deal with someone else at that point.

    If he wants money back, then work it in his contract to pay when it snows a certain amount of inches or hours in a large storm, or a certain amount of storms, Im sure he wont like that either and will keep the deal as-is.
    Go in with your statistics from the past few seasons and show how much he would have paid per push versus the contract. If he made out ahead then politely tell him you feel you are being more then fair with the way things are.
  19. justme-

    justme- 2000 Club Member
    Messages: 2,138

    He's useing his size to pressure you into the discount- I agree- tell him no.
    He signed the contract and he knew what he as signing. If you have a solid contract it's binding, and I'll bet it's the same contract he signed several times now.

    Customers always feel 'had' when there's a light year and they sign a contract- part of the deal with a contract and they should realize that. If you buckle this time you'll face more pressure next year or the year after when he says "Well, you plowed me for $2000 less this year so you can continue the next contract for the same amount or I'm not signing"

    Never give in when a customer has signed a contract- it's not in your intrest. Yeah the wallet will hurt in the short term if he walks, but you'll make up for it in other customers and if you give in odds are you'll be aggrivated more and more by them in the upcoming season and wish you had just told him off, plus be working for less money.
  20. lawnsrusinc.

    lawnsrusinc. Senior Member
    Messages: 141

    Its like having an insurance policy what if u dont wreck your car all year do you get your money back from your monthly payment.... Ah Nooooooo