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Long term customer "Counter Offer"

Discussion in 'Commercial Snow Removal' started by Ne1, Sep 29, 2014.

  1. Ne1

    Ne1 Senior Member
    Messages: 370

    A management company I've done snow for over 17 years has sent me a Counter Offer asking me to lower my pricing on certain services. These are 7 mid size commercial buildings. Also, they are not willing to sign a multi year contract. What would you do?
  2. John_DeereGreen

    John_DeereGreen PlowSite.com Addict
    Messages: 1,711

    Without knowing details I can't answer for how I would respond. Be careful, it's a slippery slope. Once they know you'll give in, they'll keep pushing it down and down.

    I don't let anyone but my bidding set my prices. If I can't get it at the prices I qoute, then I'm not interested.
  3. Ne1

    Ne1 Senior Member
    Messages: 370

    I agree if I go down in pricing this year next year will probably the same thing.
  4. beanz27

    beanz27 Senior Member
    Messages: 984

    Tell em 5% if they sign multiyear, otherwise they get same price.
  5. LapeerLandscape

    LapeerLandscape PlowSite.com Addict
    Messages: 1,452

    I agree, you both give a little and you both get what you want. I would think they like your work and you like the account hopefully its profitable. After 17 yrs don't let someone else have the chance at it.
  6. Ne1

    Ne1 Senior Member
    Messages: 370

    These are nice properties and I would like to keep them. I just feel without a 2-3 year contract I will continue to get beat up on pricing every year.
  7. gc3

    gc3 Senior Member
    Messages: 713

    How much % did they counter offer lower on it and ask them why won't they sign a multi year contract.
  8. Drano0127

    Drano0127 Junior Member
    Messages: 11

    We've offered some small % drops if multi year contracts were signed for long time customers, but for the most part, everything went up. They probably already have prices from other contractors that are lower. I would try to dig deeper and find out what's going on.
  9. Ne1

    Ne1 Senior Member
    Messages: 370

    I did ask and they replied they don't sign multi year contracts. Its about 10% what they countered at.
  10. snowman55

    snowman55 PlowSite.com Addict
    Messages: 1,071

    10% ? On what services? The games that get played, I hate them. ( cut your salt price by 10% then add a $90 truck fee, lower your hourly rate then add an administration fee, lower your shovel rate then add a tool fee, lower your "open up" fee then do an "open up" every 2", lower your equipment rate then increase fuel surcharge) I have seen all these tactics used to "look" like the cheaper service, in the end costing more. The question is what is there budget they are trying to hit and what services they can get for that. If you were underbid by 10% after 17 years what are the other guys backdoor charges or what service is he skimping on. What is does the 10% really mean? how many services? Example - are you overpriced on shoveling but under on plowing?
  11. Ne1

    Ne1 Senior Member
    Messages: 370

    These are per push pricing with salt and shoveling being charged separately. There trying to knock my plowing prices down. These management companies are always playing games. They know what the level of service there getting from me yet they feel the need to beat me up on pricing. Every year there's going to be someone who bids lower and that will never change. You would think there would be a understanding that with great service comes a price...
  12. dieselss

    dieselss PlowSite Fanatic
    Messages: 10,739

    We had this happen to us. Lowered the price played there game and they dropped us for the lowballer. Halfway through last year, we got them back at our original price. Price is what you pay, quality is what you get. Sucks your in this boat
  13. Mark Oomkes

    Mark Oomkes PlowSite Fanatic
    Messages: 10,416

    Have you asked what services they would like to cut or how they would like to lower their expectations?

    I tried it for a lawn bid, it didn't work out and of course the winner of the bid didn't even come close to following the specs.

    That's what really ticks me off. If everyone followed the specs, my prices wouldn't seem so high.

    Ask them if there's any way of reducing service. After last winter they have to be nuts to think they can cut 10% out, unless you raised them 15-20%.
  14. snowman55

    snowman55 PlowSite.com Addict
    Messages: 1,071

    You have to decide how bad you want them. Will they really go over the 10%? Are they just asking to see if you give it or will they hire cheap? Do you want to play games? Add truck fees to salt and shovel? How good do you know prop manager? Can you take em out for lunch and explain this? Ask to review other proposal - This has worked in past for me you can point out the backdoor charges of other company that they may not see. (I lost a big account to RX here They looked cheaper but the maintenance guy was pissed with all the hidden truck charges they added)
  15. gc3

    gc3 Senior Member
    Messages: 713

    If they want to drop it 10%, then you need to sell them that your worth that 10%. Maybe tweak it a little or compromise with them somewhere. What happens if someone falls on a area that they wanted less on. Then I'd bet they wouldn't argue about price then.
  16. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    tell them no problem,I'll plow 90% of the lot now.
  17. LapeerLandscape

    LapeerLandscape PlowSite.com Addict
    Messages: 1,452

    You might want to have a walk through with them again even though you have been doing it for yrs just to compare apples and apples. We lost a job this way a couple yrs ago that we had done for 3 yrs. The new guy did not do half the detail work that we did shoveling out multiple overhead doors and salting the entire complex and not just parking areas. I am pretty sure we will have it back this year.
  18. Ne1

    Ne1 Senior Member
    Messages: 370

    Pretty frustrating. I agreed to a 6% reduction on my plowing prices and they agreed to sign a two year contract. If it wasn't for the fact of having 7 properties with this company I wouldn't have done it. It's late in the bidding season and I wouldn't have been able to replace these accounts with new ones.
  19. Do It All Do It Right

    Do It All Do It Right Senior Member
    Messages: 231

    What are you doing about salt?
  20. Ne1

    Ne1 Senior Member
    Messages: 370

    The salt pricing was never in question.