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customers wanting to negotiate contracts

Discussion in 'Commercial Snow Removal' started by grf_1000, Feb 22, 2011.

  1. grf_1000

    grf_1000 Senior Member
    Messages: 295

    Last year was the second lightest snow fall on record. we avg. around 150" per season and ended up with 92". this season we have so far 88". yes the seasonal contracts are nice but the per push are hurting. i've already had seasonals want to renegotiate the seasonal price for next season. how quick to forget that 2 seasons ago we had 181" and the season before that was 173"
    anyone else run into this? i'm sticking to my guns, it wont happen to us 3 seasons in a row. this is the snow belt, well unless the snow belt has moved south :)
     
  2. serafii

    serafii Senior Member
    Messages: 285

    I've been dealing with this for theast 3 winters. In 2007 we got 400cm of snow. Our average is 215. The past 3 years we put a clause in our seasonal contracts that after 240cm, they would be charged about $1-$6 per cm.

    95% of my clients signed. But for the last 3 years we never exceeded 150cm. They all ask to carry over the left over 90cm to the next year.

    Example: $250(monthly charge) x 5(winter months)=$1250
    $1250/240cm= $5/cm

    I've been sticking to my guns since the first year we set the 240cm limit and no one is getting anything.

    All I tell them is that all the other years its exceeded the limit I never asked for a penny in return and that the extra charge is just to cover extra fuel costs and wear n tear.
     
  3. grf_1000

    grf_1000 Senior Member
    Messages: 295

    i dont have a snow fall limit in my contracts. we avg. 150" if we get 175" its my loss. if we get 100" its my profit. i didnt ask for more money when we had 2 feet of snow over avg. now they want to cut the seasonal price by 10-15% because of the last 2 seasons. which would be fine if there was a cap on snow fall. however they are not willing to pay extra if we get more. i know if i dont agree i wont be offered another contract and i'm sure there are dozens around here that would jump on it.
    i know my prices and my costs. if the winters continue it would be fine but an avg. snow fall winter would be a loss. they have been very happy with my service for the last 5 years but it come down to the all mighty $$$. time to go back to the negotiating table and see what we can hash out.
     
  4. Mick76

    Mick76 2000 Club Member
    from Maine
    Messages: 2,157

    GRF,
    If your customers want you to make concessions then they better be willing to do the same. When its time to renego show them the 10 year average in your area. Yes you had a few light years (good for you) but then show them the above average years (good for them)... If they don't want ot resign with your current rate, compromise - knock down your seasonal contract 10% but include a limit like you suggested above. Tell them if they want you to gamble they have to be willing to do the same....
     
  5. 32vld

    32vld Senior Member
    from LI, NY
    Messages: 620

    Why does the plowman or the customer have to gamble?

    Why can't the customer pay for the work done?

    Why can't the plowman charge only for the work done?

    Why charge for work not done?

    Why do work and not get paid for it?

    Why play games?
     
  6. grf_1000

    grf_1000 Senior Member
    Messages: 295

     
  7. chs1993

    chs1993 Senior Member
    Messages: 297

    Thats a whole point of a seasonal contract. Its a gamble for both sides, alot of the resi like seasonals for the reason stated above
     
  8. serafii

    serafii Senior Member
    Messages: 285

    Having a seasonal contract with a cap works out fine for both client and company. A seasonal contract with no cap is more of a gamble.
     
  9. 32vld

    32vld Senior Member
    from LI, NY
    Messages: 620

    So some people are willing to gamble until they lose. Then this must be told to the complainers as soon as the open their mouths.

    People should be able to budget by figuring on their yearly average.
     
  10. grf_1000

    grf_1000 Senior Member
    Messages: 295

    very true, our average is 150". 3 seasons ago i did not go to them and ask for more money went we ended up with close to 180" or the season before that when we had 170" but 2 lighter seasons and they forget about what we truly do average.
     
  11. got-h2o

    got-h2o 2000 Club Member
    Messages: 2,439

    why are you yelling??? We can read the standard font just fine. Seasonal contracts are much more common than you think, saying its playing games tells me that you must not realize this. It's a great way of doing business. A seasonal cap is a must though. I just negotiated another months payment just b/c the cap was reached.
     
    Last edited: Feb 23, 2011
  12. dlcs

    dlcs 2000 Club Member
    Messages: 2,149

    Oh the ol, its all fine if the plow guys takes it in the arse but if the plow guy has a good winter then we are going to change the rules. They want their cake and eat it too. F them!
     
  13. cretebaby

    cretebaby PlowSite Veteran
    Messages: 4,162

    Likewise you should be able to figure a seasonal price the same way.

    Not doing a seasonal price is a gamble IMO.
     
    Last edited: Feb 23, 2011
  14. jklawn&Plow

    jklawn&Plow Senior Member
    Messages: 469

    I think plowing fifty 3" snow falls is more work gas than 22 7" snow falls.
    So basing it off of the total snow fall will only get you in the viscinity of what your making.
     
  15. got-h2o

    got-h2o 2000 Club Member
    Messages: 2,439

    When would it ever snow those exact amounts? Never. Seasonal totals are an average of 1/4" dustings and 12" snows alike, it all averages the same in the end.
     
  16. 32vld

    32vld Senior Member
    from LI, NY
    Messages: 620



    I am not yelling. If you had a BS in Graphic Arts you would know what a serif type face vs a sans serif typeface, and that serif type faces are easier to read as is size 4.

    And my eyes are not what they use to be.

    Where to I send the typography lesson bill?
     
  17. jklawn&Plow

    jklawn&Plow Senior Member
    Messages: 469

    MY year this year but only seems like 80 in max. I hear where your coming from but it is hard to see from customers perspective or ever want to give money back. You can look at seasonal totals but I put more into how many times I go out and plow with the hours I plow- never look at totals.
     
  18. Kramer

    Kramer Senior Member
    Messages: 386

     
  19. BrianWillan

    BrianWillan Junior Member
    Messages: 11

    Isn't the solution to a seasonal contract with no cap to have it be a 3 year deal? That way it averages out for both the plow contractor and the customer?

    Cheers

    Brian
     
  20. grf_1000

    grf_1000 Senior Member
    Messages: 295

    yes it is but the last 2 have been mild winters and thats what they are basing it off. this is the 3 year of the contract.