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How Can They Do It For $15 Dollars?

Discussion in 'Commercial Snow Removal' started by ColumbiaLand, Jan 9, 2009.

  1. ColumbiaLand

    ColumbiaLand Senior Member
    Messages: 790

    Well figured I would not lose any this year, were 90% commercial accounts and only 10% residential, but I received a call from a residential customer of 4 years who said she found someone who could do her snow removal for $15 Dollars!!! Its a small drive/w half circle and large area in front of detached garage, with a long wide walkway to the house that we always clear. Our minimum for snow removal is $45.00. She said the fifteen dollar's includes shoveling her long walk!!!. We do all of her landscape maintenance and lawn maintenance in the warmer months. The real kicker is that she is right next to our shop!!!. I wished her good and told her is she needed anything to give me a call. Its not a big loss to me, but I just don's understand sometimes how these people can do it for nothing. I cant wait to see there "New Guy" damage something and I'm sure he has not insurance and not a whole lot of experience.
     
  2. ColliganLands

    ColliganLands PlowSite.com Addict
    Messages: 1,854

    guys probably brand new, no overhead costs(insurance,commercial plates, etc)
    so he figrues if he can get a bunch of $15 drives for his bveer money hes all set.
    my minimum is $35 and i had a tough time signing contracts so now i plow for the town
     
  3. jhawk60

    jhawk60 Junior Member
    Messages: 9

    They are working for wages, if you have a winter that is hard on their equipment they won't be there next year. You see the same thing in the construction industry every time the economy slows down. You can't find work to save your life because laid off workers are doing it for a few bucks over their previous wage. It works well for them and they think they are raking in the dough until they damage something, have to replace or repair equipment, or get hit up by the tax man, then they disappear.
     
  4. ColumbiaLand

    ColumbiaLand Senior Member
    Messages: 790

    Well the few residentials that we do have are all people that I know well including this former client, I do not have a contract with them, just a hand shake. I do have multiple year contracts with most of our larger commercial accounts though. Although its annoying to lose it, its not a big loss. Its barely 0.25% of my total profits from the whole season.
     
  5. I am always surprised to hear of a long time client changing over a few dollars. Yes the new guy is substantially cheaper but with that comes costs. He probably isn't insured and the minute he blows a transmission your old client won't see him again. These are all important factors that should be stressed to the client. If I were you I would write a letter highlighting the benefits of using you over a no name company doing things so cheap. Reliability being a key factor. Advise the person that if this guy breaks down and can't continue the season you may or may not be full at that time so you can't guarantee availability.

    I know you are not losing much but these low ballers need to be stopped.

    The guy was probably working somewhere for $8 an hour. So he gets a blade and figures he can now make $15 per hour. Thats a noticeable wage increase to an uneducated and inexperienced businessman.
     
  6. BMWSTUD25

    BMWSTUD25 Senior Member
    Messages: 630

    yeah everybody thinks because they hear plow contractors or landscapers charging 60 75 80 100 or 150+ an hour that we get to put that all our pockets:dizzy:. so they think they can come in do it with no overhead and no real business, insurance, taxes or any real equipment and charge 15 bucks...so he does 10 driveways at $15 during a storm and thinks hes so far ahead of his $8 dollar an hour job at burger king.... You just have to deal with it and they wont last as soon as a tranny goes or they hit a car or garage. although some states are now making it very hard for these fly by night businesses to start up with high cost and making everyone need to be licensed. I wish New York would go more that route.
     
  7. MattR

    MattR Senior Member
    Messages: 218

    $15 is still high for my area when it comes to lowballers. A few weeks ago I seen a CL ad for somebody offering plowing for as little as $5. Maybe we need to see what equipment they are using. Whatever they use must be some fine machinery, never breaks down, never collides with anything, and uses only a few drops of fuel for each driveway. I want whatever they are using..lol.
     
  8. RODHALL

    RODHALL Senior Member
    Messages: 374

    i have a few driveways i do for free. (moms, mother in laws, and few older family freinds) i do them to help them out like they have help me out over the years. i got a lot of slack because i took the one driveway, he was paying someone to plow untill his wife passed away. then his income was cut in half and he could no longer afford it. so now i do it, every time his boys make deer bloina he brings me over 2 rolls.

    so you never know it may be a family member trying to hlp them out

    if they are trying to make $$$ then they are not doing by only charging $15....
     
  9. Eronningen

    Eronningen Senior Member
    Messages: 442

    I get good money for my work but plow a handful of driveways for bow hunting permission. :nod:
     
  10. willyswagon

    willyswagon Senior Member
    Messages: 111

    There will always be low ballers. Before I closed shop in 2000 I had some great contracts, and customers. One Private road subdivision had 10 houses on it. I did the road 1/2 mile long for $75. Wait..... I did every house for a minimum of $30. Back drag a garage was another $5 shovel your walk and step a further $10. So every snow fall I'd spend a hour to a hour and one half there doing the work and charge $425-$500 (this is in 2000). The last year I was in busness, one of the customers figured out what I was taking out of the subdivision and thought it was steep. He started to complain to the other Doctors and lawyers in the group of the rate it worked out to each time I came.

    They contacted me to say they found some one to do all of the work for $200 per event, including shoveling walkways.:confused: I didn't bother to tell them that I was moving to another province, and getting out of the business, and wished them all the best with the new contractor. No hard feelings:cool:

    This fall I meet one of the owners from the subvision across a room of about 150 people. I say to my wife Is'nt that so and so from...? Next thing I know he is standing beside us saying the worst thing we ever did was let you go! The guy that replaced you sucked. He was always stuck, always showed up late, did a ****%ty job. We canned him 2 months later. The next guy rolled his truck off the bank, big environmental clean up.He had no insurance and walked away from it! It cost them $35000.:p

    Guys the long and short of it.... Stay Professional!!
    Sooner our later the customer will realize that "Great Service always trumps Price!!":gunsfiring:
     
  11. Jay brown

    Jay brown PlowSite.com Addict
    Messages: 1,783

    that there is a damm good story!!!
     
  12. SnowedUnder

    SnowedUnder Member
    from ontario
    Messages: 65

    Or maybe these guys lost their jobs and have very little money to put food on the table so they have to do it for $15.

    What would YOU do it for if you have to feed your family?
     
  13. Gettindirty

    Gettindirty Member
    Messages: 38

    I can understand all sides. Major markets get $40-50 per drive. Small towns, driveways are a hobby $15-20 is about it. Add up but not great. I'm a pro in a small town and I can not charge double the hobby guy. The worst for me is the farmers. Nothing to do in the winter, truck and plow are paid by the farm and they work their trucks for $50-60.
     
  14. L.I.Mike

    L.I.Mike Senior Member
    Messages: 364

    I plowed a Hotel for $100 an hour. From 2 inch trigger until the storm stopped and the lots were clear. I was replaced by someone who plowed the place for $400 total. He plows for the first storm and goes to the property owner crying he underbid the job and now wants $1200. Property owner says no but never got a contract so the plower does not show up. Now the property owner will plow the place himself.
    Go figure.
     
  15. ff1221

    ff1221 PlowSite.com Addict
    Messages: 1,327

    That is the standard price per clearing here, and that is right in line with all the other contractors in town, if someone stops me for a one time shot, it's $20, and if they call because they haven't shoveled it for two weeks, it ranges from $30 to $50 depending on the day i'm having, our lowballers come in around $10. I would love to get $25 to $45 per shot, but with an average of 30 to 35 events per season, it's tough. I do 75 driveways in about 3 to 4 hrs, so it's not bad. Plow trucks get about $60 per hour, which is to low. I don't know what conditions other contractors are dealing with, such as size of driveway, distance apart, and so on, so I can't comment on their pricing, I know with mine, they are mostly standard 2 car drive, and all within a 2 miles of my yard, or 3 kms for us Canadians.tymusic
     
  16. paponte

    paponte Senior Member
    Messages: 717

    Think you should change the heading to read "WHY" would you do it for $15.00? In my book it's just called bad business. There's a big difference between competitive pricing, and not having a clue what to charge. You'll have that account back soon enough. It's obvious the guy has no clue what the cost of doing business is.
     
  17. Winterized

    Winterized Senior Member
    Messages: 120

    Or maybe these guys lost their jobs and have very little money to put food on the table so they have to do it for $15.
    What would YOU do it for if you have to feed your family?


    And this may be true.... but you see some of these guys plowing like a raped ape to ... make it up on volume... and then have an accident, or damage property! Who has come out ahead?

    Their hole just got deeper.
     
  18. BMWSTUD25

    BMWSTUD25 Senior Member
    Messages: 630

    yeah that whole excuse of putting food on the table gets over used IMO. Of course everyone wants to do that but then they need to understand the liability they are undertaking by not being a legal and insured business. And if someone else is doing something for $40 and they give a price of $15 to "put food on the table" do they really need to go that low in the first place........I mean 30 or 35 would still be under the other guy right without blowing the market to pieces.......but then I'd still consider that a low baller, just not a dumb low baller!
     
  19. SnowedUnder

    SnowedUnder Member
    from ontario
    Messages: 65

    Hold on, why do you think that it's only low baller who go like apeshit? Have you seen some of the "pros" with a hundred driveways?

    Second....

    I use to have a guy plow my 20 by 50 driveway. It took him five minutes to do the job and for that, I actually did pay him $15. With about 20-25 2" events, it cost me about $350 a season. Now the guy did a series of driveways on my street and probably netted $150-$180 bucks an hour. Do you think that he could charge $40 without 500 plows waiting to take his work?
     
  20. Winterized

    Winterized Senior Member
    Messages: 120

    Hold on, why do you think that it's only low baller who go like apeshit? Have you seen some of the "pros" with a hundred driveways?

    Second....
    I use to have a guy plow my 20 by 50 driveway. It took him five minutes to do the job and for that, I actually did pay him $15. With about 20-25 2" events, it cost me about $350 a season. Now the guy did a series of driveways on my street and probably netted $150-$180 bucks an hour. Do you think that he could charge $40 without 500 plows waiting to take his work?


    You are 100% correct..... but the no insurance guy trying to make it up on volume causing damage has dug himself a hole much deeper than the fully insured guy. Both should be using more common sense..... but one will suffer much more.

    That is the biggest reason I never invested in a truck plow..... paying that extra insurance and working for nothing. For many things in this life misery is optional.