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New Business Advice

Discussion in 'Introduce Yourself to the Community' started by anz27, Feb 4, 2016.

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  1. anz27

    anz27 Member
    Messages: 44

    Hi All,

    I wanted to make this post to get some feedback. I am going to be as descriptive as possible so you all can make appropriate comments and suggestions. I apologize for the length.

    Next year, I am considering opening the doors of a snow removal company. I graduate from the University of Pittsburgh in April with a degree in business. The reason I mention this so people know I not some uneducated bum that doesn’t know what the hell he is doing. I do not have a job currently lined up, but I am sure I will find something. I have worked several years in the industry and am decently knowledgeable about some aspects of the business. I am 22.

    I currently have a plow from another truck (Western 7’6” straight blade). It’s new and in great shape (still has original cutting edge) All I need is a truck and the mounting necessities. I will be purchasing a car or truck in the next few months, so if I am going to start the business I will just buy a truck and use that as my daily driver as well. I am thinking about buying a 1500 Silverado with a plow prep package, especially because it is my daily driver as well. I can always sell the truck in a few years when the business grows and becomes more demanding. I understand that this is not ideal, but considering the entire year, a 2500hd might be overkill since its only 7.5 ft. Should I go new or preowned (Late model, no more than 2-3yrs, 30k miles)?

    Assuming I have a job, what do you see the best way to get the business rolling? I will not work on the side for someone else. I want this business to grow so that I can get out on my own, then start some other businesses as well (Lets just leave that beast out of the discussion for the time being). THIS WILL ALL BE DONE LEGITIMATELY, TAXES PAID AND FULLY INSURED! (Unless you all suggest a better/different path). I know I will be limited on what jobs I can take due to limited work hours plowing (5p-5a) I understand that there is still a lot for me to learn, so please leave feedback IF you have experience.

    Thank you all for taking the time to read, as well as leaving feedback if you wish.
     
  2. thelettuceman

    thelettuceman PlowSite.com Addict
    Messages: 1,216

    For someone who is educated < that would be you >... educate yourself about 2500 / 3500 series trucks. A 2500 would not be overkill but the minimum you need.
     
  3. anz27

    anz27 Member
    Messages: 44

    I know a lot about them. I also know that you do not need a 2500 for a small plow (I am pretty sure its a Western HTS, but not positive). Yes, 2500's are far more durable and robust, but lets not get wants and needs mixed up here.
     
  4. SnowFakers

    SnowFakers Senior Member
    from CT
    Messages: 942

    Gunna be hard to plow if you currently have a job with time constraints. Even if it just stops snowing as you get out of work it will still be a long night in the truck plowing and then back to your normal job. My advice would be to sub for someone else, that way 1) You can still make money with a truck and plow when it snows 2)You dont need to drum up said work, you just come and work. Alot less stress. And 3)If you cant plow because of your day job, then you simply cant. They will just have to make due without you, rather than you leaving YOUR own customers high and dry.

    As for the truck, nothing less than a 3/4 pickup if this is something you intend to get into and want to do more than a few driveways. 1/2 tons will work but they can get eaten up faster that is for sure.
     
  5. ktfbgb

    ktfbgb Senior Member
    Messages: 752

    I would have to agree that the 3/4 ton is the minimum. When I was plowing for another company, not myself, he had a lot of different vehicles. Mine was a bronco with a 7.5 plow. The purpose of this vehicle was for me to hop around from lot to lot where the other crews were plowing and hit the spaces where cars were parked near and the bigger trucks couldn't get to. He had a brand new tranny in it for the season. I wasn't new and I knew what I was doing. I wasn't hard on the truck. Halfway through the season the transmission bell housing cracked in half in the Walmart parking lot we were plowing.

    The moral of the story is you said this would be a daily driver. The tranny in a half ton is not built for that kind of work. You may lose your daily driver half way through the season and then what? How would you get to work, how would you service your contracts if you had no back up?

    In the snow removal business there is no 5 pm to 5 am. The only way to get customers is to be available to fill your contractual agreement at any time of the day. The snow does not care if you are working, and you may be liable for a slip trip injury if your not out plowing with the storm and doing what you are contracted to do. No one is going to buy plowing service for when the storm is over and I get off work I'll show up. Even if they did then you are going to destroy the half ton really fast because you didn't plow with the storm.
     
  6. JMHConstruction

    JMHConstruction PlowSite.com Addict
    Messages: 1,052

    Since you do not have the truck already, I agree with everyone. Get a 3/4 ton and you will be happier in the long run for plowing snow. I would get a gas, they're easier to work on and cheaper to maintain. I understand that you want to use the plow you have already, but in the future the bigger truck will handle a bigger plow. I'm not sure how long the light duty plow will last with commercial plowing.

    The reason companies hire snow and ice management business is because they know that the business they hire takes weather, and their job seriously. Trying to run a snow business and have a full time job is extremely difficult. What many guys (including myself) don't understand when they get into the business is you're working even when it's not snowing. You have to constantly watch the weather, you have to do site checks all the time, you have to do equipment maintenance, a ton of paperwork and invoices. The list could go on and on. If you decide to do this while also working a full time job, there is just no way you will be able to make your customers happy 100% of the time.

    If I were you, I'd get a bigger truck (if not for now, for the future) get on as a sun for another company, and go from there. It doesn't only snow from 5-5. You are on call 24/7. Some days it will be only a few hours, others you could be out for days. I'm not telling you not to do this, but figure out every worst case scenario and have a solid business plan.

    Good luck
     
    Last edited: Feb 4, 2016
  7. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Always remember,your working on some else time not yours, they paying you to work for them .
     
  8. BUFF

    BUFF PlowSite Fanatic
    from FR NoCo
    Messages: 7,221

    What type of work are you planning to go after would be a good thing to know when it comes to the plow/truck combo.
    Assuming you looking at resi's a 7.5 with a 1/2t pickup is enough to get things rolling and probably work well for you if you stick with resi's. There's plenty of guys that started oot with smaller rigs and they served them well. Heck when SnowFakers first showed up on PS he was running a Ford Ranger with a 6'8" Meyer home plow (sorry but it is what it is) and has since gotten into a bigger rig. I would get a used truck with less than 50K on it, still plenty of life left in it and aboot 1/3 or less the cost of new.
    With resi's you have a little more flexibility and can have a day job. Most resi's want the driveway cleared before they head oot to work and before the come home. When plowing and having a day job it about balance between the two. Since you have a limited window of time to plow and still go to your day job a tight route is a must and preferably on the way to and from the day job. I would target subdivisions with small driveways that you can knock oot in less than 10min (including some shoveling). Another good customer would be churches, lots are typically less than 1acre and their only concern is having the lot cleared for the day of worship and nights when they have activity's. I have a couple churches and they're great, during the week they're the last place that get's plowed. I would stay away for gas stations and anything retail, you also would see an increase in your G/L due to exposure for slip and falls. They'll also be to demanding and they won't work for you having a day job. I won't do gas stations or retail, for me it's not worth the headache.

    In regards to setting up a legit business I would suggest setting up a LLC and a DBA for dealing with taxes. Make sure you have a minimum of a $1m G/L policy ($2m would be better) and have the truck is insured for commercial snow plowing. You're going to find a standalone G/L policy for snow removal is going to come at a premium. One way to reduce the cost of your G/L to have also do lawn-care in the summer or another type of service / contractor related business that you can add the plowing on to the policy.
    When it comes to the tax side of things talk to an account and insurance talk with your agent. Don't rely on people on a forum to give you advise for matters like this, it's you butt and you want to make sure it's covered.
     
  9. anz27

    anz27 Member
    Messages: 44

    Thanks everyone so far, especially BUFF for the insurance info.

    Lets clarify a little more, vehicle options:
    1) Brand New 1500
    2) Used Newer 1500 ('13 and up) unless i find a smoking good deal on an older one
    3) Brand New 2500HD gas job
    4) Honda Civic (screw all the bs and go do something else)

    I'm curious to see what we get on that one. I WILL NOT buy a used HD truck, I do not want someone else's headaches. So please let that go, it is non-negotiable.

    Please keep in mind this is a part time gig for the time being. If I was able to make 10K profit, I would call that a great start. I know of people who work full time jobs and plow on the side. You just have to pick the right smaller commercial properties as well as resi's. I am trying to get away from being an employee, and becoming an employer. I do not want to make this a life long career, but doing it for some years to begin that journey is just fine with me. I live at home with my parents. I have a backup vehicle that I can use should anything happen.

    As for the lawn care stuff, I really do not want to get into that lifestyle. I by no means intend to offend anyone with this statement, so please don't take it personally. That is just a can of worms I really am trying not to open. I had my own properties I did in high school and it served me well, it is just time to move on to bigger and better things.

    I don't mind doing snow removal, and I see significant opportunity there for my situation. I need to find some type of job, because like you all, I have bills to pay. That kind of eliminates doing this stuff full time starting this winter.
     
    Last edited: Feb 4, 2016
  10. terrapro

    terrapro PlowSite Veteran
    from MI
    Messages: 3,873

    Lawn care is below you but snow plowing is going to suit you better?
     
  11. iceyman

    iceyman 2000 Club Member
    Messages: 2,537

    You are all over the map.. Not sure where to even begin
     
  12. anz27

    anz27 Member
    Messages: 44

    Not at all. Just do not want to do it for a living.
     
  13. JustJeff

    JustJeff 2000 Club Member
    Messages: 2,023

    Seems like there's a new kid every week who's gong to get rich in snow removal. And find customers that will work around his part-time schedule. As stated above by someone else. What happens when your one and only truck breaks down, or your plow does? What happens with the customers then? What happens when it's snowing and you're obligated to be at your 40 hour a week job?
     
  14. anz27

    anz27 Member
    Messages: 44

    Not to start an argument, but how is $10k a year rich?
     
  15. beanz27

    beanz27 Senior Member
    Messages: 984

    Sorry you need to really think this over. You want to buy a brand new 30-60k truck to do plowing on the side? Good luck. You'd be much better off buying something used for cash. How happy will you be when it doesn't snow and you have to pay for way more truck then you need? Also mpg on 2500 is roughly half of half tons in my experience.

    Especially if your only doing this for a few years, no need to buy something you won't need. On the flip side a half ton just isn't going to cut it.

    As far as subbing goes-good luck. I run a few subs, it's either all in or not. Every year I have a few guys call me to ask for work around their work schedule, my answer is always "What am I supposed to do when it starts snowing 3" an hour right before your supposed to go to work?" And I always get the "gee I don't know" response.

    To make it in snow, regardless of resi or commercial, the most basic necessities are Reliability, and quality. One can't go without the other.
     
  16. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Just get the Honda.
     
  17. JMHConstruction

    JMHConstruction PlowSite.com Addict
    Messages: 1,052

    The problem with what you want is it doesn't make since from a business standpoint. Like Beanz said above, you want to spend all this money on something part time. It will take you YEARS to pay everything off. If you're good with 10k you could get some guys and start a sidewalk crew. That's all I do and usually bring in more than 10k. Less equipment and less break downs. It's "full time" for me, but if it doesn't snow at all one year I'm not hurting too bad. It's more just extra to keep lights on and keep my main helper busy.
     
  18. jonniesmooth

    jonniesmooth Senior Member
    Messages: 228

    You want to make a $10,000 PROFIT in a less then a 6 month season (usually), part time? For a business educated guy that's seems like quite a stretch. I made $900 this week, with 2 1"+/- events. My broom for my sweeper broke, had to have parts machined, etc. to fix cost me $500. My sub was out too, had to pay him $130. My insurance was due, there's $300. Granted that's not every week, but it's more typical then not. If you want to put $10K in your pocket, your going to have to earn double that, part time. Good luck.
     
  19. Mark Oomkes

    Mark Oomkes PlowSite Fanatic
    Messages: 10,853

    2500's have better stickers............
     
  20. snocrete

    snocrete Banned
    Messages: 2,862

    option 4
    _______
     
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