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ok ok, i am serious here......

Discussion in 'Commercial Snow Removal' started by insnow4fun, Jan 17, 2005.

  1. insnow4fun

    insnow4fun Member
    from Indiana
    Messages: 43

    what classifys one as a lowballer......i am not trying to start an arguement, just curious.

    i have been reading this site for about 2 years (for fun) and have recently began posting. i am curious, that since i have started contemplating getting into the business...with a 1/2 ton truck, 7.5' plow and 3 accounts....does that make me a low baller? i plan to start a business, get insurance and try to charge the going rate of my area (if i figure out what that is). i don't feel like i am lowballing...just taking small baby steps into a lil bit of an unknown.

    please don't bash me, but let me know if i fall into that catagory and i will see if i can attempt to change what i am doing. i am not out to take anyone's accounts, just merely service three accounts the best i can with the equipment i have (or will obtain)
  2. extremsnomobile

    extremsnomobile Member
    Messages: 51

    i am with you. im 15 and i shovel 5 driveways when i can during a storm. plus i get stuck down at the explorerpost 85 to shovel. i have a snowblower taht works kinda. and my trucks are a parking lot truck and one that i crashed into a buildign plowing out a parking lot. if i put a plow on my ztr that would be cool but not sure how it would do. so im new to it to. well on my own that is
  3. johntwist

    johntwist Senior Member
    Messages: 415

    Hey, this is America. The free enterprise system allows for saints and a$$holes alike to shakedown the public for every cent it can, it's every man for himself and it's easy to be critical of a man's methods in obtaining the all-mighty dollar.
    As far as plowing snow is concerned, the low-baller is one of the most debated topics on PlowSite and I can only give my interpretation of it with no guarantee of being right.
    I think the real lowballer is any contractor who has won a job, either from or over another guy, by offering a lower price and/or promises of better service. The kicker is that after winning the job, the service provided ends up not being better, and is sometimes alot worse. The low-baller is usually not insured properly. Since proper insurance adds to an operator's costs, he has to charge accordingly to pay for it and still make money. The lowballer usually knows this, and will go in for less, knowing full well that he's making it back by not paying insurance premiums, among other things.
    There are a variety of other cost factors. A low baller usually owns his 10 to 15 year old distressed pick up and his plow outright. Saving on that payment means lots of profit in the short-term. But......high maintenance costs and losing customers because the truck is down when they needed service prohibit real long term profits.
    It's similar in any service business, you get what you pay for. The lowballer is usually the guy who makes some great hit and runs for a few seasons and then puts his Meyer up on EBAY when he gets sick of replacing the pump.
    The toughest thing about doing something properly and safely while still maintaining the highest level of customer service is profiting by it. It's many years of establishing a strong base of regular paying customers who realize they have a good guy and won't risk losing him to save 20 bucks. It's about pride and integrity, about longevity. As far as I'm concerned, if you're in this business for more than 5 seasons straight and you've got a strong, loyal customer base, whatever you're charging, you AIN'T a low-baller!!!!
  4. stumper1620

    stumper1620 Senior Member
    Messages: 222

    i agree, only you missed the part about the guy usually has an "in" on what the other bids are, so he can knowingly make his lower.
  5. Mick

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

    My definition of lowballer is: Someone who deliberately and knowingly uses another person's bid to set a lower bid.

    This definition will cover any contingency as a lowballer could be insured and have payments, etc, but is going for "quantity over quality". In my way of thinking, the key is using someone else's bid (work) instead of doing thier own calculations in determining a price.

    (edit) Stumper1620 and I were typing at the same time with the same thoughts :waving: .
    Last edited: Jan 18, 2005
  6. IndySnowPlow

    IndySnowPlow Senior Member
    from Indiana
    Messages: 214

    Low-baller = A person or persons who have information on current bids/pricing for a particular set of customer(s) and knowingly submit an amount/price for the same services to a potential customer that is substantially lower than other contractors prices, in hopes of persuading the potential customer into going with the (lowballer) contractor service mearly on the basis of a LOWer price.

    CAUTION :::: Lowballing is extremly hazardous !!!!! :nono: Oh...Hi Tony,,um I mean T ....Hows the wife ? Meadow ? Tony Jr. ? Ok, so that little situation has been taken care of with XYZ contractors.... :gunsfiring: Thanks T...Sa-lome
  7. glenspot

    glenspot Senior Member
    Messages: 255

    I have to agree with the others thus far.

    As I've learned from others on this site, you are best served by trying to determine your expenses. (gas, insurance, repairs, profit, etc) Then trying to determine what you are going to charge for the service you offer.

    If you happen to come in WAY under another bid, then you did it honestly. If you find that you are not winning enough bids, or getting enough jobs....then you may be spending too much money on your expenses, and need to cut back.

    But, above all...ALWAYS strive to do good work, do what you promised, be honest, and look good. (in that order)

    Simply don't be too concerned with what others are charging, and price yourself where YOU want to be. In my opinion, doing that...regardless of what you actually charge...will keep you off the lowballer list.
    Last edited: Jan 18, 2005
  8. insnow4fun

    insnow4fun Member
    from Indiana
    Messages: 43

    thanks guys, i was asking because i enjoy this site...heck, been reading for two years....and if i ask questions, it is because i am new to the industry and really don't know the answers. i do not ask, and will not ask specifics about pricing...although, i will/might ask..with a lil help of pricing structure.

    when i do that....the best way that it can be said is without specifics.

    what i am thinking so far, is to charge x dollars for 2 inches of snow, and each inch more i charge x dollars more. i charge per event (24 hr period) if the nws sez we got 6 inches you get charged for 6 inches (even though i stopped by twice to push, you know, gotta take it easy on the equipment. i am sure there is a better way to think about it, and i am open to all ideas. so let me know.
  9. Robhollar

    Robhollar Senior Member
    Messages: 766

    I agree with the above statement...Rob
  10. jkitterman

    jkitterman Senior Member
    Messages: 140

    You might be a lowballer, if ....

    You might be a lowballer, if ....you have to ask if you are a lowballer...or a redneck? Maybe I am just confusing the two. Sorry, I just couldn't resist.
  11. Randy Scott

    Randy Scott Senior Member
    Messages: 142

    Anytime someone doesn't get the account they bid on. Then that other company is a low-baller. Well, according to these public forums. Seems anytime someone looses out on a bid, it's because the other guy low-balled. It'd be nice to here someone with balls say "hey, the other company must have sold themselves better with a competitive bid". Even though someone else could do it for less and allegedly make money at it, we call them low-ballers.

    So again, my answer is anytime we don't land the bid, it's because of a low-baller. I'm probably guilty of this way of thinking as well.
  12. ghost

    ghost Member
    Messages: 65

    I looked it up in websters

    Lowballer= Someone who can do a job cheaper than you and still make a buck
    Crybaby= Someone who lost a job to a lowballer
    Dont forget that alot of the jobs you might have because your price was cheaper than someone else's :drinkup:
  13. alittle1

    alittle1 Member
    Messages: 35

    Now, let's put the shoe on the other foot

    So you been kinda gouging your customers for the past few years. The price of gas went up so you raised your prices and they paid. The snowfalls were heavier than normal, so you bitched and moaned and charged more and they paid up. Because you had more disposable income because of all this, you bought new trucks and equipment, (even fancy new strobe lights on 12 sides of your truck). By doing this, you paid less income tax and even saved a pile of money because you sold your old equipment to some hack privately for cash which you didn't declare. Now you get up on your soap box in every coffee shop in town and decree, "If I don't get my price, my plow and I don't work! I don't work for scab wages!"

    Well boys get down off your soap box because someone is working for you you. You can call him a Lowballer if you want, but he's doing what he has to do to make ends meet, he's doing what you don't want to do, and he's making some money, maybe not a whole hell of a lot, but some money. Have you got enough grit to meet him on his terms?

    On the other hand, the customer that you been 'porking' for the last few years, has been asking questions, getting prices and taking names. The $6 bags of salt that you been charging him $18 for is getting a little hard to take and if I plower comes in lower in price, he's going to move on him. It's called 'fair competetion', not a monopoly, or whatever you can bleed the sucker for. Your customer can dial in to the same web sites that you are on and see what the scuttle butt is in the snow removeable business in his area. Hell, 4 phone calls thru the Yellow Pages will net you the same thing.

    If your competetive you'll be making money. If your overpriced and not working, you'll be sitting on some web site, bitching and moaning about Lowballers. Okay, you do the math now!
  14. DJL

    DJL Senior Member
    Messages: 343

    LOL...I think you are correct. Very well put. If they lose a bid they blame it on a lowballer. Heck, just own up and say I lost because the other company offered more or whatever.


    I can see your point about having someone else's bid and bidding significantly lower to land the account. Fine, you want to classify that as a lowballer than go ahead.

    However, I have to respectfully disagree with your insurance statement. It was something along the lines of "they are not properly insured". Last time I checked, correct me if I'm wrong, insurance is not REQUIRED. Insurance merely covers the risks you are taking in the business. If a business chooses not to have insurance than they are doing nothing wrong/illegal. They can operate their business however they see fit. If the company doesn't pay insurance than they can charge a lower (often much lower) price. Why is this wrong? It how they choose to operate their business, which is within their right.

    Shouldn't we be upset with the CUSTOMER for taking the guy without insurance? After all they are the ones choosing these, as most people call em, 'lowballers'. Another way of looking at it, do you want a customer who doesn't care about the contractor having insurance?
  15. cja1987

    cja1987 PlowSite.com Addict
    Messages: 1,407

    Don't you have to be 16 to drive in Massachusetts, I see you have all these vehicles and your not old enough to drive.
  16. cja1987

    cja1987 PlowSite.com Addict
    Messages: 1,407

    AH, an old Meyer, the true sign of a lowballer, at least around here :nod:
  17. foyboy41

    foyboy41 Member
    Messages: 38


    i think the more we talk about it the better it is the natural progression that takes place when you have comon interests is you want to be in- line with what others are doing or what others have done before you so that you remain in their good graces and can go to them for advice or opinion.the way i see it is we need to organize and keep all members accountable .alot of good info is given away to unknown people who could be your competition.......
  18. plowman350

    plowman350 Senior Member
    Messages: 125

    lowballers are short termers

    People on this site get so fed up with lowballers. But, its the american way!
    Now before I get bashed, let me say that I pay taxes, and insurance. But, becuase I'm a one man operation, I can afford to do work for a little less, and still come out with roughly the same profit margins as a larger outfit. This doesn't make me a low-baller. I know my expenses and desired profits, and price my services accordingly. I'm making a decent profit, and have turned away business this year.

    People need to stop blaming life on "lowballers!" The truth is that we compete for business....that's the idea behind capitalism and free markets. When the auto companies decided they could automate the assembly line a hundred years ago, and make the car affordable to average joe, they weren't low balling....they were picking up market share and selling more volume. I'm just tired of reading all the moaning about low-ballers when most of the time it was purely competition that they lost.

    In the less frequent case of true low-ballers, they should be of little concern to business professionals. We need to stick with our prices, and if our customers want to try a cheap price for a season, they'll get what they pay for. Logic says that if they get poor service or their property gets damaged without any ins to cover it, they'll go back to a professional quite quickly. That's just the ebs and flows of the business. These low-ballers can't keep a profitable business for very long, and soon your customer will again be looking for a service provider. As long as your price is fair and your service excellent, we'll get those customers back. IF they go with another low-price guy, then either they're a little slow to learn, or they're so cheap you probably don't want them anyway.
  19. insnow4fun

    insnow4fun Member
    from Indiana
    Messages: 43

    wow, sorry i even made the post

    all of this arguing....over a low baller.....

    at this point, i agree with what is being said previously. it sounds as if lowballing would be based on one's overhead in the business. new trucks new plows etc raise overhead....a one man operation (perhaps with a network of other one man operations in case needed) CAN operate at a lower cost and still maintain the profit margin. if that man, takes care of his equipment and is there every event, then the customer is happy. i do not see that i am trying to become a low baller here, but with what i am contemplating, one man operation, if i maintain my profit margins, then i am a sucessful business owner. sorry to stir the pot, that was not my intent.

    i do have a question....how many have had a customer they serviced for lets say five years, no complaints...and then all of a sudden when you are collecting contracts for the next season, your customer sez...you know, joe bob with joe bob's was here, quoted me 30 dollars less than what you quoted....if that customer is happy with your work, he wants you to plow, but it is a money issue, how many would lower their price, to keep the customer. and if so, isn't that a form of lowballing? you know, the competitions price to adjust your price to make sure you keep the customer?

    as i have stated before, i am new at this business, and some or most of you might hope that i shrivel up and die in this industry, but there might be a few of you that choose to help me when i post questions. i thank you in advance for that, but i will not discuss specific dollars (ie to do a drive way, to do a lot), but if i ask about a structure, it would be great to get some assistance....i just don't want to know who charges 25 for a drive and who charges 60 for a drive. i just want to see how you arrived at what ever figure you might get for that lot or drive. ie $ x for 2" of snow, $ x additional per additional inch of snow, so on and so forth.
  20. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 7,900

    LOWBALLER :nono: the guy who plows for pocket change a couple of times until the big snow hits then there gone .
    no insurance,
    uses there Dads truck and gas or there old truck, has to be in school by 8am or to there full time job by 7am, charges $20 where you charged $40 to $50. Does not collect sales tax. gives snow plowers a bad name . If you do these things you might be a lowballer :gunsfiring:
    In northern MN there is allot of competition for the commercial accounts, there are a lot of landscaping companies that snowplow and allot of people own plow trucks here.
    Isn't capitalism fun :drinkup:
    But it does piss me off when one comes by one of your accounts and trys to low ball by offering to do it for half price, haven't lost any yet, but it is a pain in the a$$ finding them off...WELCOME TO THE SNOW BISS :D