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Customers switching from Seasonal to per push

Discussion in 'Commercial Snow Removal' started by Bsox171, Jan 25, 2010.

  1. Bsox171

    Bsox171 Junior Member
    Messages: 8

    90% of my contracts are seasonal contracts, most of them being in the $300-$400 range since I only do driveways and most of them are very small. I had the customers put 50% down upon signing and another 50% due at the end of January but in the past 2 weeks Ive had 3 customers call me and ask me if instead of paying me their second half now if they could switch to per push for the rest of the season. I said yes and the $300 contracts will now be $30 per push for the rest of the season and $400 contract will be $40 per push for the season. Basically this means I only need 5 snow events for the rest of the year to get the amount of money I was going to get anyways. These high temps and low snowfall totals are scaring the customers a bit. I know its a bit of a gamble on my part but the chances of getting at least 5 events for the rest of the season is pretty high and theres also a very good chance we'll get more than 5 and these customers will end up paying more than they wouldve if they stuck to the seasonal contract. So my question is would you guys have done the same? I almost feel guilty like I took advantage of my clients misunderstanding of the business. Thoughts?
     
  2. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    As long as they stay with you you'll be ok. But at the end of the season if they paid more for the per pushes tell them next they should just leave it alone and stray seasonal.
     
  3. clark lawn

    clark lawn PlowSite.com Addict
    from NE ohio
    Messages: 1,233

    no i wouldnt, if it was a busy winter would they pony up the additional, i doubt it.
     
  4. Pristine PM ltd

    Pristine PM ltd PlowSite Veteran
    Messages: 3,794

    I would never do that, you had a contractual deal, and they broke it. I hope they learn a lesson and you get 10 more plowables.
     
  5. Bsox171

    Bsox171 Junior Member
    Messages: 8

    This is my first year in business on my own and I only took on 20 driveways to keep my load light and learn the business side of the plowing gig. And so far Ive received nothing but compliments on the work i do, so I dont see any reason they wouldnt stick with me. My prices I feel are very competitive and I go the extra mile to make sure my customers are satisfied. But hey you never know, I wouldnt be suprised if one of them did stray off but if they do I guess its a lesson learned.
     
  6. Bsox171

    Bsox171 Junior Member
    Messages: 8

    Now thatd be great, I certainly wouldnt mind some extra cash in my pockets
     
  7. ADLAWNCUTTERS

    ADLAWNCUTTERS Senior Member
    Messages: 212

    Tell them NO NO.Seasonal plowing is like insurance.They can't change the rules in the middle of the game.Like other guys said would they pay you more if you had a bad winter.Tell them even if it doesn't snow one flake.You still have truck payments,insurance,overhead. Tell them if they don't believe you to go to the ford dealer and price out a truck & plow.Or you could be cocky and say"if you don't like it get your toro snowblower out and do it yourself"
     
  8. JR Snow Removal

    JR Snow Removal Senior Member
    Messages: 390

    easy now! I have a toro snowblower and love it :laughing:

    But I take you already told your customers you would do that? If so let it be but if not I wouldn't do it like others said if you got hammered this year would they have paid more above and beyond the contract? Most likely not. Stick to your contract next they will be asking if you can do it for $20 instead of $30 b/c the snow wasn't that deep. Trust me people will take advantage of you when they know they have some pull.
     
  9. Bsox171

    Bsox171 Junior Member
    Messages: 8

    Theres no way Id do them for 20 per push. I get my seasonal contract rates by multiplying my per push rate by 10 for that particular driveway. That way my seasonal customers save a bit since they are basically supplying me with job security. I allowed them to switch now since theres a good chance it will pay off for me, but theres no way Im changing my rates.
     
  10. JDiepstra

    JDiepstra PlowSite.com Addict
    Messages: 1,780

    I think you did the right thing. You could make more, and you are just giving them what they want. You are a serivce provider after all right? If they end up paying more and want to switch back to seasonal..... NO WAY!
     
  11. ACA L&L

    ACA L&L Senior Member
    Messages: 362

    Well since you have already agreed to letting them switch over theres nothing you can do about it now but in the future these customers will be wanting to change the contract to fit there needs as they see fit. From here on out do not allow this to take place. You need to pay for the equipment that you have in place to fulfill your side of the contract. If anything I would of said sure but at double what you would have bid before plow season started. We have year round landscape maintenance customers that occasionally try to cancel service until the spring, at this point we explain how the year round contract works, as we did when we signed them up,if they still want to cancel they need to fulfill the 90 day cancellation and then they will need to find a new company to work for them. It all comes down to budgeting. You planned to have a certain amount at certain times and thats it. Lesson learned. Good luck from here on out.
     
  12. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    He didn't say where he lives. if it's a smaller town you don't want to be a jerk because work could dry up fast.
     
  13. kramer56

    kramer56 Senior Member
    Messages: 595

    I was asked the same ? from my customers and i said noway unless the goes to 40-50 each time. They signed and new the risjed of getting no snow for awhile. back in december not one of them offererd any more money when i was plowing everyday for 2 weeks and I when i asked about that they changed the subject. So I no we have to keep them happy but if we don''t have the cash to stay in business how we gonna keep them happy? Its a gamble either way. I plow around every 3" and they know that and if they want me to wait the price goes up. My # of plows is around 30 -40 a season thats how I figure my contracts, damn lake effect lol
     
  14. Bsox171

    Bsox171 Junior Member
    Messages: 8

    See thats the beauty of it for me, my trigger is 2 inches but Ive gone out at an inch-inch and a half and clear out my seasonals and see if the per pushes want it done and so far none of them have said no. So I only need 5 days of basically an inch to inch and a half accumulation to break even. So the more I think about it the more it seems the odds are vastly in my favor of making more money.

    And the town I live in is a pretty average size upstate town, population is maybe 10,000. But the snow removal market is very saturated so theres plenty of competition to worry about.
     
    Last edited: Jan 26, 2010
  15. dlcs

    dlcs 2000 Club Member
    Messages: 2,149

    I disagree. Now that they are on a per push basis. They will tell you to wait until there is no less than 2" on their driveway. Also, after they hit the amount of that last installment in per push billing, some will try to get you to put them back on seasonal. They switched to save them money and thats what they will try to do.
     
  16. Grn Mtn

    Grn Mtn PlowSite.com Addict
    Messages: 1,644

    agreed.

    20 customers is very easy to keep happy, if you have a complaint with 20 customers get out of the business hahaha.

    Changing the contract (do you have one with them?) mid season, well its what they wanted so that makes you look good, but if they get pounded they are going to be pissed and might not re-sign, if it stays light, your not going to make money - aka hard to stay in business. its easy to not make money the first couple of years because nothing breaks that you really have to pay for, but when year 5 comes around and all hell is breaking loose - literally, money is what you need. Do not change it again this season, and make sure you get a change of contract signed immediately with your new per push agreement.

    Now that you are per push you cannot go out at 1", you will get flamed. Its amazing how people will hold off on calling when they are responsible for every trip.
     
  17. FisherVMan

    FisherVMan Senior Member
    Messages: 706

    Well I think your doing the right thing here as where you live its for dam sure your going to need to plow 5 more times . I would bet your going to plow 10 more times this is only the third week of Jan for god sake there is a HECK of alot of cold weather coming and probably tons of snow. Those guys are nuts to fool around with it . I would give you good odds they will loose money on the deal and you are in a win win situation. They asked you for a favor to let them outta a contract and you gave it to them . I am dam sure I wouldnt feel one bit guilty if you wind up plowing 10-12 times . So much so that I would have the ones that want that sign another contract that says "they" requested to be let out of the original contacts for a "per push" contract and this spring when it costs them double since you resigned them have the contracts in the glove box so when they ask about switchen back you can act like Columbo and say " now if I remember right YOU wanted to switch this darn thing not ME! ;) ;) ;)
     
  18. NW Snow Removal

    NW Snow Removal Senior Member
    Messages: 533

    either way they will try and pay the least possible. We don't let them switch mid-year without a new multi-year deal that has a cancellation clause where they have to pay us to get out.
     
  19. FordFisherman

    FordFisherman PlowSite.com Addict
    from 06611
    Messages: 1,593

    I hope you got it in writing and signed. The same people that switched will be the same people that won't want to pay if it goes over the original seasonal number. I understand your thoughts as to potentially making more money, but I see trouble down the road in collecting your money from these people. Again, make sure you get it in writing.
     
  20. swtiih

    swtiih PlowSite.com Addict
    Messages: 1,179

    As soon as they pay for the next 5 pushes they will probably want to go back to seasonal.