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Lowballers-hate Them

Discussion in 'Commercial Snow Removal' started by EXPGMEDIC, Oct 31, 2004.

  1. EXPGMEDIC

    EXPGMEDIC Junior Member
    from INDIANA
    Messages: 16

    Well once again it is snow contract time and I now have lost 2 of my biggest contracts to lowballers. I was charging 100 per hour with out sand/salt and 200 with sand/salt this "new guy" who just bought a used beater with a plow came in and was charging 30 an hour on all lots. This guy is going as far as placing fliers to residentials. In his flier he states " if you cant afford to pay or are on a fixed income will plow for free call for more info" This really ticks me off. I got one attached to my door. My back up and somewhat competition (who lives less than a block from me) even got a flier. ( we also help each other out at times being friends). We came up with a plan for the first snow. We are going to call him and tell him we cant afford to plow our drives (due to his lowballing and my friend has lost more than I have this upcoming season) and see if he comes out. Then have all trucks sitting in drive. HAHAHA
    Maybe that will stop his efforts.
    With fuel prices going up , insurance never cheap and equipment maintenance issues no wonder people cant make a living with people like him.


    :gunsfiring: "lowballer new guys"

    Mavericks All Seasons
    -----------------------
    03 superduty 8'6 western
    92 tj 6'6 western
    90 f150 7'0 fisher
     
  2. johntwist

    johntwist Senior Member
    Messages: 415

    I may be new, but I don't want to be low!

    This is my first season coming up.

    A buddy of mine owns 4 houses including his personal residence and 3 he rents out. He's giving me the plowing business for all of them to help me get started. We have not agreed on a price yet, but I haven't given him a quote either. I asked him if he'd tell me what the guy who did it for him last year was charging him and he said he would. I was thinking of staying close to that just out of fairness, my inexperience versus my buddy giving me the work.

    I can tell you that it's all just driveways and I've seen 3 out of the 4. None are very long or wide. One is single wide for about 25 feet and then goes double wide with a jog on the right for 2 more parking spaces. The other two are 2 cars wide by 4 cars long and 3 wide by 6 long. The one I have not seen is about 2 wide by 4 long.

    I am not responsible for shoveling by hand or doing walks, but I was planning to sprinkle some sand and salt by hand if he wants, that's not been decided yet.

    The trigger is probably going to be 3 or 4 inches.

    So my friends what do you think? What do you recommend I charge based on what I've told you and how should I break it down? By the hour, by how many times I have to do each property? I haven't seen much "flat rating" discussed here, do any of you do that?

    All I know is that I don't want to low ball it. I don't want to screw my buddy either, I just want something that's fair. Thanks for your help.
     
  3. The Boss

    The Boss 2000 Club Member
    Messages: 2,099

    You're probably going to get some s--- about looking at the previous guys' prices. :D Everyone, take it easy on him, he's new. :nod:
    As far as pricing, if I were to apply MY prices, the small drives would be $25.00 each and the big ones would be $45.00 each. When I did residential plowing(gave it up due to being a pain in the ass) I waited until the snow stopped or if it was still snowing, I would plow them early in the morning so they could get out and then once again when it stopped. :waving:
     
  4. johntwist

    johntwist Senior Member
    Messages: 415

     
  5. The Boss

    The Boss 2000 Club Member
    Messages: 2,099

    I see where you're coming from. It's a friend, don't worry about it. I've got your back on this one. :nod: :drinkup:
     
  6. EXPGMEDIC

    EXPGMEDIC Junior Member
    from INDIANA
    Messages: 16

    clarification of previous

    100 per hour is commercial. Residential small driveways 20-50 per push and as boss stated do them early or after snow stops so they can be able to leave easily.
     
  7. VALLEYWIDEPA

    VALLEYWIDEPA Member
    from pa
    Messages: 38


    gee i hope he has insurance and whats he making on that 30 an hr like 10 cents. dont worry they will call u back after 1st storm
     
  8. johntwist

    johntwist Senior Member
    Messages: 415

    Thanks for the advice, and for the beer, Boss.

    25 to 45 a push on the driveways falls in with what I was paying for mine before I bought my plow.

    Just one thing though for clarification, I know that doing flag-downs and one-shot deals that you charge by each push. But, in a situation like mine, where I'm going to have to clear each of his 4 driveways every time it snows, is it still per each push or is it per storm. I mean in those cases where say I hit them all early in the am but it keeps snowing so I have to go over there later that day and do them all again. Because this is repeat business would you charge just for 1 push each driveway or 2 pushes each?

    I've seen threads here where guys have talked about one price for the job once the trigger is reached, but that includes coming back as many times as you have to during that storm to keep it clear. Is this true? :drinkup:
    Let me buy this one.
     
  9. The Boss

    The Boss 2000 Club Member
    Messages: 2,099

    On my per push accounts, every time I plow them, I charge them. :nod:
    Here's another for ya! :drinkup:
     
  10. johntwist

    johntwist Senior Member
    Messages: 415

    Oh yeah Boss, BTW........

    .....I hope your old man, the old boys and the Indians are all right and we get hit hard this year!

    Baby needs a new pair of shoes!

    And thanks, I do believe I'll have another one! :drinkup:
     
  11. The Boss

    The Boss 2000 Club Member
    Messages: 2,099

    My old man calls me almost everyday to find out my status as far as being ready for snow! He's never done this before so maybe it's a sign? I also talked to this old(er) guy I know named Ray. 5 years ago, the year before I started my own plowing business, he saw a caterpillar in his yard and said that because of the way it was colored and so thick, we we're going to have a bad winter. We did. Got 2 12in. snowstorms back to back in Nov. and snowed about every other week until March. Well, guess what, he saw another one last week! :yow!:
    Here's one more for ya but that's it. I'm sure you have to get up in the morning! :D :drinkup:
     
  12. Dnipro Max

    Dnipro Max Member
    Messages: 60

    Lowbalers :gunsfiring: I found out that here lowbalers charge $40 per hour on commercial, but going rate is $100, so how we can make living? :gunsfiring: lowbalers :gunsfiring:
     
  13. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    johntwist - this may confuse the issue, but consider:

    Charge by the storm. In other words charge, for instance, $30 per storm. This would be for anything that falls in any 24 hour period. You might plow it once or three times per storm, but you get to decide which will work best depending on circumstances. If it's say 12" of light and fluffy and it all fell before he needed out to go to work; you could just push it all at once. Or maybe it's wet and heavy and you'd rather push every 4" to 6". This gets around the argument, if charging every push, that you could have waited or you came too often etc. I just picked up one for that very reason, even though I charged more "per push" than the last guy.

    Like I said, my main reason for pricing like this is control; I know my equipment and what it can do, I watch the storm coming and the snow falling. I know what needs to be done and I don't want someone else telling me what I "should have done".

    It takes a little judgement. The really small ones are set up at my minimum of $25 for 3" to 12", others are 3" to 8"; 8" to 12" and biggest ones are 3" to 6", 6" to 9", 9" to 12". Anything over 12" is an additional $xx per inch over 12".
     
  14. Eyesell

    Eyesell 2000 Club Member
    Messages: 2,101

    I think the lowballers will always be creeping in our door, there is really no way around them, other than what was suggested earlier, insurance, beat up trucks and equipment, I'm not what to do. I guess I'll keep reading and see what happens.

    Best of luck to ya :salute:
     
  15. Robhollar

    Robhollar Senior Member
    Messages: 766

    I might get flamed for this but here it goes:

    Time and time again guys will ask here "What should i bid". Well I believe that question can only be answered buy yourself. Only you knows what your actual cost are. I bet there are allot of guys on the board who think they know what their cost are but until you put the figures down on paper then you simply are only guessing what the actual cost are. Some time ago a buddy of mine and me had this convo about my actual cost are. I replied that" its about xxx dollars an hour". Well he wanted to know how i came to that figure. Well he pulled out a piece of paper and said lets see the receipts. Well it took the better part of the afternoon but I found out I was underbidding my tree work but i was above the board on the snowplowing. My point was before that afternoon I thought I was making more money then i really was. YOU have to add up all of your cost and see if it reasonable to charge what your cost are. I believe until you do this then your not in business, its only a hobby....Rob
     
  16. The Boss

    The Boss 2000 Club Member
    Messages: 2,099

    I agree with you on that one Rob. :nod:
     
  17. Robhollar

    Robhollar Senior Member
    Messages: 766

    Thnx allot Boss:

    Oh ya and another thing I try not to worry about what the other guys are charging. What they charge have no bearing to what I need to charge. It only means if my cost are way out there then I need to stand back and figure out if I can cut cost or should i go find work other places. Just because Joe Blow can plow a drive cheaper them me, does that make him a low baller? I don't think so, it makes him a better businessman then me. Now if Joe Blow plows the same drive cheaper then me and hes losing money while doing it then THAT makes him a low baller and he should be tied to a tree somewhere during a biggiest blizzard and left there to think about it.
     
  18. The Boss

    The Boss 2000 Club Member
    Messages: 2,099

    I've got my set prices. If someone outbids me, fine. But like you say, if someone outbids me and is making no profit on the gig and they just want the accounts, then that's when they've officially earned the title LOWBALLER.
    With the rising cost of fuel this year, I was forced to raise my prices accordingly. Due to my past years of reliability and excellent service, I retained everyone of my accounts despite the higher costs this year. That made me feel pretty good. :nod: :drinkup:
     
  19. Dwan

    Dwan Senior Member
    Messages: 879

    Low Ballers come and go
    but High Ballers stay and play



    Boss and Rob welcome to the play ground

    Offer quality for a longer term, say 5 year contracts?
    Offer an incentive for early payment, say 2% if paid within 10 days of billing for 1 year contracts up to 10% for payment received within 10 days of billing for a 5 year contract.
    70% of my customers have been with me for over 20 years.
    raised prices 25% this year with 10% gain in customers.
     
  20. SCSIndust

    SCSIndust Senior Member
    Messages: 280

    I can't say I totally agree with you about figuring prices. I look at it this way. Everyone needs to be within a ballpark range. Anyone out of the range is either lowballer or just too high. If I can afford to do this real cheap, others might just consider me a low baller. If I have to price real high to turn my ideal profit margin, then I am doing something wrong, and need to look at my expenses more closely. There is a reason why prices are the way they are - because that is what you need to charge to make a living. So, if I streamline my expenses down to where I can underbid everyone by, say, $30 an hour, then I will most likely get the jos I bid on. With that said, let's think about this point: Now that I spent all this time streamlining my business, I am still making the same profit margin as if I didn't, theoretically. I lowered my expenses, but I also lowered my rate. However, as a reward for keeping my expenses so low, I should bid closer to the going rate and make more money off the deal. I am a firm believer in fairness in the industry, and hate when some has lower expenses, so they bid lower, and always get the contracts. How am I supposed to make a living? Even more, by bidding lower, the current prices never increase although the cost of living always increases.

    I am finding that lawn and snow prices are the same as they were 5 or 10 years ago for commercial contracts. The cost of living has gone up, why shouldn't prices?? So many big companies can offer lower rates because they have lower over-head. It keeps the prices low.

    I am not preaching, just trying to get everyone to open their minds a little. Bottom line --- 1) What is the going rate for your area? 2) How can you streamline your business to bring your profit margin higher?

    For those who read all this, thanks for sticking with me.