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How much money should I be making?

Discussion in 'Business Fundamentals' started by CalgaryLawnSalo, Nov 12, 2012.

  1. CalgaryLawnSalo

    CalgaryLawnSalo Junior Member
    Messages: 4

    I've owned a snow removal and lawn maintenance business for four years now. I've done fairly large scale snow removal for three years.

    90% of my plowing work is pair per push.

    Last year I had 18 residential acreage clients in a rich area and no other work. It was worth $1,000.00 per push. I thought this was enough as previous years were the same and I made $30,000 - $60,000. Last year it snowed much less and I only grossed $16,000. It was horrible. I never want to have to deal with that **** again.

    Now I have six large parking lots, nearly 30 large residential acreage drive ways, and a 150 acre rural community in its development stages. Now I'm making $2,500-$3,500 per snowfall depending on how large it is. Plus I have $1,000 guaranteed a month by other clients.

    I do all the work myself with one 06 F350 and a 2010 8' Boss Plow. My only expenses are Insurance, WCB, phone, diesel, truck/plow repairs, and advertising.

    I'm wondering if I finally set it up right or not? I'm only 23 and new to the game but eager to learn as fast as possible.

    I love plowing and want to make a living at it working hard hours when it snows. Last snowfall of 8 inches I work 16 hours without eating or a break, slept for 3 and then worked 7 hours more; but I made $3,500. I feel this is what I need to be doing but not sure.

    I taught myself how to plow and never worked for a plowing company so I'm fairly new with a lot of things.

    If there's anyone out there willing to throw some advice my way it would be much appreciated.

    Thanks
     
  2. shovelracer

    shovelracer Senior Member
    Messages: 525

    Most would say you are spread thin. I would get another truck on the road. Around here most will not stand for waiting 16 hours.
     
  3. thelettuceman

    thelettuceman PlowSite.com Addict
    Messages: 1,216

    Good Advice.... I hope you are listening.
     
  4. CalgaryLawnSalo

    CalgaryLawnSalo Junior Member
    Messages: 4

    No one is waiting 16 hours. I do my commercial parking lots from 10PM - 4or7AM then do my residential acreages from 7AM - 12PM. If there's a lot of snow I get backed up a couple hours but clients in this area understand as we usually get a lot of snow and large falls can be days on end.

    So for now I don't feel another truck is necessary in any way. Next year I can get more business and plan on getting another truck but until then...

    I'm more wondering, for supporting myself in the winters as a business owner; is making on average $200 an hour, and working for 10-15 hours per snowfall (roughly $2,500 - $3,500 per day of work) enough money?

    Other years I made 1/3 less per snowfall and still ended up doing really well due to providing removal 40-60 times each year.
     
  5. ducaticorse

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

    Dude, how are we supposed to know if you as an individual are making enough money to support your specific lifestyle? Think about it.
     
  6. Raymond S.

    Raymond S. Senior Member
    Messages: 513

    I can't really answer your question of how much money you need to make. The first thing that comes to mind is what is your backup plan? Seems like you got a good thing going but the rug could get pulled out from under you with one catastrophic failure. Do you have subs you could call as backups? I understand not wanting to add another truck but you owe it to yourself and your customers to have a plan in place.
     
  7. Wilnip

    Wilnip Senior Member
    Messages: 583

    I call B.S. on all of it.
     
  8. JD Dave

    JD Dave PlowSite Fanatic
    Messages: 11,046

    The prices in Calgary are extremely good. I think the story sounds good but I don't think he's going to be able to service his clients well enough.

    So the year you made 60k you must have had 60 pushes if you get 1k/push. Now your saying your going to get between 2.5k-3.5k/push? Even on 16 pushes like you had last year on 2.5k/push low side your going to make 40k on your worst case senario. If all of this is true there is no doubt in my mind I'd be buying another truck or hiring a sub.
     
  9. ducaticorse

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

    His numbers are realistic enough to me. I work in an affluent neighborhood within spitting distance to Boston and I have 14 accounts that take me roughly ten hours that gross me 2700 all of the accounts are within a half square mile of each other. I have one other lot that I sub that gets me roughly $800 and another that grosses me 3-400. I do this all with two guys maybe a third if its a bad storm, one bobcat, two one tons with a salter and a single stage blower. Each additional four inch increment, I do an additional 70% over that $2700. What he says he does can be done with one guy in the hours he claims, BUT his questions regarding how much he needs to make are ridiculous, as well as leaving all his eggs in one basket running only one truck...
     
  10. CalgaryLawnSalo

    CalgaryLawnSalo Junior Member
    Messages: 4

    I hear where most you are coming from and firmly agree in most areas. I do need another truck 100%. As of now I do not have the finances, but responses here are leading me to believe I can handle a loan for a new one with the work I have.

    Also, I should have been more specific with the "enough money" aspect of my initial post. Calgary is very expensive city, very inflated due to the big oil and small population. VERY hard to find a place with a garage to hold my equipment and I can't afford rent and a $275 per month storage unit as they are here. So rent for a place I need starts in the $1500 a month range + utilities. Then ad business expenses at about $1,750 a month when plowing. I know I can make that in one day of work, but I guess I'm looking from advice from experienced guys who understand if that's sustainable. Plus I spend a decent amount on fun. Snowboarding 20+ times a year, dirt biking, some travelling; but all that's maybe $500 a month.

    Also, with the year I made 60K I was clearing at trace amounts. I had the contracts for two large 70 unit townhouse areas and it snowed a lot that year. Now on normal snowfalls I make $2,000. Anything over six inches I make about $3,000. Anything over a foot is about $4,000. So it's hard to put steady numbers on the amounts I might make. Two years ago it snowed 60 times including trace amounts. Last year it snowed 16 times including trace amounts. These fluctuations also concern me. I understand the need for per month contracts but they are much harder to find. I just put in a bid but pretty sure I went to high as that seems to be the hardest aspect of the job so far.

    And to whoever said I can't give quality working like I am - Wong. Over 14 of my clients are from two years ago and all the new ones have already been very pleased with services when the first snowfall was 12 inches two days in a row.

    Oh ya, the two guys at the beginning kind of freak me out saying I'm spread thin? Some you seem to think it's a good amount of work and some don't?

    One more thing, I hate the big trucks for residential. Many have very narrow driveways with deep snow and trees super close to say the least. I wonder how half ton trucks do? A Ford Raptor preferably. They have the power of a quarter ton easy but are much smaller and more manoeuvrable to speed things up drastically. Just the suspension and frame durability worry me? If I get two trucks I feel that could be a good route: one full ton and one half ton. Try to get most my work residential as that's where I make the most money. I honestly work in the top 5 richest areas in Canada. $50+ a driveway that takes 5-15 min tops with a large truck. A smaller truck would be no more then 5 or so for all them. Plus could double up with two trucks.

    Anyways, I appreciate all the criticism and help. Keep it coming.
     
    Last edited: Nov 14, 2012
  11. Burkartsplow

    Burkartsplow PlowSite Veteran
    Messages: 3,245

    Why would you get a raptor to plow in? Get a keep do resis and make life easy.
     
  12. blowerman

    blowerman PlowSite.com Addict
    Messages: 1,261

    Oddly the guys here haven't been all that critical of your post yet....
    The first post is about how you have it all figured out and your costs are accounted for, then down the line we hear about the high cost of renting a shop plus utilities etc....
    Your numbers are solid, the route for plowing sounds decent, how about putting together a good business plan?
    Instead of fretting about buying another truck, just add a sub. Then you don't need to worry about high or low snow years related to the cost of equipment. Marketing costs are less per customer/account as you grow...
     
  13. Burkartsplow

    Burkartsplow PlowSite Veteran
    Messages: 3,245

    Good stuff
     
  14. 2COR517

    2COR517 PlowSite Fanatic
    Messages: 7,115

    Your overall workload sounds about right for a 23 year old kid. I did a similar amount of plowing at 35 years old. As long as you have the timing worked out and the customers expectations are being met keep it up. But you desparately need a sub or two lined up for a breakdown or heavy back to back storms. Throw at least one a few hours of plowing every storm to keep im in your pocket when you really need him.

    A half ton truck is basically the same size as a won ton so im not sure how much better it will be for plowing.

    You could really improve your productivity by upgrading your plow. Bigger, wings, vee plow, all of the above. More reach with your plow will keep the truck out of the trees and bushes too.
     
  15. ducaticorse

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

    There are enormous differences between a 1500 and a 3500 (half ton to one ton). breaks, axles, transmission, suspension rear end. Although physically the same size, the added weight load a one ton can carry, enables it to push bigger blades in deeper snow, without problem. 1500 (half ton) trucks are a sick joke when it comes to commercial snow work.
     
  16. leigh

    leigh PlowSite.com Addict
    from CT
    Messages: 1,997

    At the end the the year how much are you banking? 5,10,15k.Nothing? During a normal year I better be putting away 5 figures or I'm doing something wrong!
     
  17. 2COR517

    2COR517 PlowSite Fanatic
    Messages: 7,115

    Yeah, I know all that. The point I was trying to make, and apparently didn't do well, is that a half ton won't be significantly easier to manuever than his F350.

    What are breaks on a truck? Sounds bad
     
  18. ducaticorse

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

    Funny guy! Didn't realize I was applying for an English teacher position.. For the record, I meant to type "brakes" not "breaks"...

    But I must point out that not only are half tons junk to do commercial plowing in, but they most certainly (in 99%) of cases never have anything larger than a 7.6 plow on, MAYBE an eight. You telling the op that he should worry more about the size of the plow rather than what it is being attached to is all and all bad advice. Or maybe I interpreted that wrong too?
     
    Last edited: Nov 18, 2012
  19. EXR

    EXR Senior Member
    Messages: 192

    Don't piss off your clients if you have a break down or delay. High end clients are in the same social class and will most likely know each other. A good or bad name spreads quickly. Do yourself a favour, hire a sub and work on the rest. You have time. We all keep learning. I've been at it for 9years and still want to learn more.
     
  20. EXR

    EXR Senior Member
    Messages: 192

    Also, bank some of that money and BUY your next truck. Don't get a loan. My f250 is paid for, I would never have two truck payments in my size of operation.