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per push pricing for periodic openings of traffic lanes during day storms

Discussion in 'Commercial Snow Removal' started by American, Sep 21, 2003.

  1. American

    American Junior Member
    Messages: 13

    I am looking for thoughts outside my company on how one might handle sites that require periodic openings of roadways and traffic lanes on, let's assume, a fully parked lot high traffic commercial lot, during day storms when pricing per push. Do you bill a fraction of the price (if so, what fraction) or do you treat it as a full plow?
     
  2. Chief Plow

    Chief Plow Senior Member
    Messages: 201

    This is a toughie.... I take care of quite a few quick marts that are open 24hrs. For quite a while I went and cleaned up the openings ( entrances and exits ) for free. I did this to maintain a good customer relation, but enough was enough. So the last couple of years, I charge them 1/2 of what the per push price was to come and clean these up. It has worked great no complaints so I stayed with it. Hope that helps

    Rick
     
  3. BRL

    BRL PlowSite.com - Veteran
    Messages: 1,277

    For my per push contracts I do them like that as well. A price to clear laneways, entrances, loading docks etc. And a price to clear the whole thing after hours when they are not operating. As far as pricing it, each one has it's own variables, so I don't have a set percentage of the complete push price. Pretend the lanes etc. are a separate parking lot & price them like you normally would.
     
  4. Clean Cut Lawns

    Clean Cut Lawns Banned
    Messages: 53

    On all of my per push accounts we charge the full amount even if were only doing roadways and lanes. the way i look at it, its a lot more risky to be there while cars are around and we salt the lanes as well. helps make up for the per even priced lots.
    just my .02
     
  5. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    You will have some who believe no matter when they drop the blade, you charge the customer for a full trip. That's what they will say anyways.

    We will prorate accordingly based on what we're doing. But I don't quote this upfront as a price since there are multiple variables that need to be covered.

    If you're doing lot clean ups at night from a daytime storm and you have just a few parking spaces, I may not charge anything since I'm going to be salting. I'll list spot plowing with no charge. If I'm opening up a lot during the day, I'll base it off of time to complete the work not the percentage of lot cleared. Since traffic slows you down and you have to go around more parked vehicles, I'll prorate if necessary.

    However, on smaller jobs (let's say those under $50), I likely will not prorate unless I do 2 minutes of work. The smaller accounts are almost just paying for show up time to check things out. On larger jobs (let's say $300), and I do 15 minutes of work, I'll prorate.

    I ask the driver's for the percentage of area completed when they're done with the work. I relate it to the amount of time they spent relative to the bugeted amount of time. I balance all of this out when determining how much to charge. This year I'll try to simplify by prorating in 25% increments.

    If you do prorate your work, you should also consider recovering those times that you show up to spot check the property and perform no work. So even though today you may have only done 25%, you might charge 50% to recover the cost for the two or three times you visited the site and didn't plow or salt.
     
  6. Clean Cut Lawns

    Clean Cut Lawns Banned
    Messages: 53

    Lawn Lad,

    Not only do i say i charge for the full amount but its what i DO!
    Not trying to stir anything up just what to be on the same page.
     
  7. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    That's cool if that's what you do. I don't like to prorate my work, particularly during the day. That's why I said I evaluate the time to complete the job. Generally day time plows are not necessarily any less time intensive even when you don't plow the whole lot. Increased travel between sites is just part of the deal and the customer pays for that daytime service.

    Where I tend to prorate more than anything else is at night time when I'm cleaning up from a day time storm and I'm just cleaning up where some parked cars blocked access. If the lanes are dry and clean since we plowed/salted during the day and I've just got a couple of parking spaces to clean up which requires plowing 20% or less of the lot, I'll prorate that plowing. I have a hard time charging $350 for 15 minutes of work. My opinion is that it builds good will with the customer. I just have to make sure in my attempt to build good will that I'm not giving away my work or loosing money.

    I will say that prorating should be considered very carefully and not just arbitrarily applied. All costs should be considered when thinking about reducing a customer's invoice.
     
  8. American

    American Junior Member
    Messages: 13

    I appreciate all the great responses. Let's add a new wrinkle to this: Let's say it is a larger site with lots of opening time and they want you there constantly (3 or 4 times during the day (essentially every time another inch or so comes down during the day during a heavy day snow storm)). Let's also say hourly is not an option. Any of you guys had this experience before? How do you bill and what have been your experiences as to what your customers have been willing to accept?
     
  9. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    If hourly is not an option and you are plowing somewhat continuously, you could price it per inch. Or once you complete once cycle of the parking lot on the per push basis you could charge again for the second or third push once you complete that many cycles. Or, you could charge per push, with an hourly caveat if multiple pushes are required on a continuing basis until the completion of the storm. If absolutely no hourly is allowed, than I'd stick the per inch or per push charge.
     
  10. SnoJob67

    SnoJob67 Senior Member
    Messages: 384

    You are taking the risk of taking it on the chin if you make a bad guess as to what to charge for "partial service." There are so many factors involved that if another contractor was there to bid the job for you, it would still be of little value.

    Either hourly or pro rated pricing are your best bets and you have already ruled out hourly.... If you pro rate, you will still be charging hourly, just not disclosing the hourly rate.

    Let's talk theoretical numbers. If you are shooting for $100 per hour and clearing the lanes takes 3 hours, you charge $300. You make that determination AFTER the work has been done. Traffic patterns at various times of the day, including holiday shopping days vary tremedously, so expect the job to take much longer than usual under those conditions.
     
  11. Clean Cut Lawns

    Clean Cut Lawns Banned
    Messages: 53

    i agree with SnoJob67,

    if you don't want to charge them the full price, figure out how long it would take you to plow the lanes and set a new item for lane opening and charge them X amount for every time you plow the lanes only !
     
  12. American

    American Junior Member
    Messages: 13

    I have traditionally thought in terms of billing PER STORM on a per snowfall inch basis. The problem is that the more I service the account, the bigger the numbers have to be. I am not convinced that customers understand the difference between a PER STORM pricing structure for plowing based on a per snow fall inch framework (2-4", 4-6", 6-8", 8-10") and a PER PLOW pricing structure with per snowfall inch breakdown (2-4", 4-7", 7-10"). The curve based on per plow would naturally be flatter than a per storm structure. The difference in cost (and thus price) could be huge for extended storms and day storms where customers want lots of service. Any further thoughts on this?
     
  13. Clean Cut Lawns

    Clean Cut Lawns Banned
    Messages: 53

    Where i price on a per storm format my intervals are around 1-3,3.1-6, 6.1- 11, 11.1 - 15, 15+ is per inch, i take into account how many times i will plow the site if it snows during the day. and work that in to my price, and if it snows all at night in one shot i'll eat a little better and if its and extended storm during the day i don't eat so well. Hope it helps, PM me if i Can help you more.
     
  14. Remsen1

    Remsen1 Senior Member
    Messages: 188

    This just an idea cause it sounds like when it snows, this will be the only customer that you will have time for. Since you have all of your eggs in one basket, I would recommend signing them to a contract for the entire plowing season and ask for 1/3 up front, 1/3 sometime early in the season, and 1/3 sometime before the season is over. I wouldn't recommend allowing 1/3 after the season cause then they may not consider paying you to be a priority. I recommend doing it this way cause you will be in deep doo-doo if they decide not to go with you and there is snow flying and you have no customers cause you kept your schedule closed.

    If this will indeed be where you spend all of your plowing time, calculate your operating expenses based on historical snow-fall averages (plus a reasonable percentage in case the winter is really heavy) and consider how much money you need to put into your own pocket. Add it all up and submit it to them.
     
  15. Santo

    Santo Banned
    Messages: 255

    My 711's prices allow me to lay a massive amount of material down a few hours before the poop hits the fan to get a brine going. Then , return after pushing activities have ceased and I'll nuke them again with a calcium cloud. They rave about their service thinking their getting some kind of a deal. Stuff is real cheap by the ton. I strive for a DRY lot within 24 hours. May be white , but DRY.