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Per space pricing

Discussion in 'Commercial Snow Removal' started by KenP, May 15, 2003.

  1. KenP

    KenP Senior Member
    Messages: 197

    Aloha,

    I sure wish I could be on vacation, but instead I'm here in Philly,Pa prepping for the next season of white stuff. Anywho, I'm back and need some expert opinions, which I know I'll get here.

    OK here's the question:

    Does anyone use a per space formula for larger parking lots? In the past I've bid by sq ft, acre and from the old hip. I've always managed to make money but I'm always looking for a easier and more effective way

    The basics on the job:

    We're talking about a four building office complex. It has roughly 1,800- 2,000 parking spaces that are divided into roughly 6-8 lots. No real hindrances for moving the snow. It also has a two lane road that encircles and connects the complex together and a sidewalk system that is somewhat larger than I'm use to dealing with. I think I have a solid battle plan for clearing the walkways and plowing grounds, but I like to use you fellas as a sounding board

    My company profile:

    We have four trucks, ample subs, loaders, quads, blowers and hand workers. We maintain one very large lot and several mid sized lots i.e. hotels, toy stores, yada yada yada.

    As always your thoughts, ideas, bitches and gripes will be respected.

    God bless America
     
  2. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    I'm intrigued. I'm just curious how bidding by the parking space would yield an easier process than by the square foot. There area always site conditions or general conditions you have to take into account no matter how you bid it.

    This may seem like a dumb question - but how do you know how many parking spaces there are in a lot without having to count out sections of parking spots unless you go by a number provided by the customer? I would think driving a wheel through the parking lot to get square footage gives you the info you need since there often is (as you mentioned with the site) access drives and other extraneous black top that has to be cleared.

    No real advice - I guess I'm just interested as well with the suggestions others have. I'm looking to gain a little insight as well. Thanks for posting the topic!
     
  3. Ohiosnow

    Ohiosnow Senior Member
    from Ohio
    Messages: 415

    Per parking space pricing

    Don't think it would be wise to price by the parking space as almost every lot I do has different size spaces ;) Plus all the differences in each & every lot :confused: ------I think sq.ft. & hrs. used together is the best way to figure your costs,

    I don't think it's possible to give a price by the amount of spaces but it could be a different way to present a bid :waving:
     
    Last edited: May 16, 2003
  4. wyldman

    wyldman Member
    Messages: 3,265

    I'd stick with your current methods,and skip the per space deal.

    Either way it should still come down to a final figure,doesn't really matter how it's calculated,as long as you making some good dollars on it.

    How are you bidding on this ? Per push,hourly,seasonal ?
     
  5. digger242j

    digger242j Senior Member
    Messages: 672

    Because you can sit in the driver's seat of your truck and count parking spaces. For a lot with perfectly square corners measuring would be pretty straightforward, but what about lots that angle different directions on different sides? How about the islands, or the number of entrance ways? You're going to adjust your square foot price to take those into account anyway. Obviously the number of spaces is not the only thing you'd base your bid on, but it's a quick and easy way to get a feel for how big a lot is without having to measure. As far as different lots having different sized spaces, measure a couple of spaces. That would tell you if they're in the same size range as other lots you're doing.

    At the bottom line, bidding is a pretty subjective matter anyway. I doubt anyone here uses a formula and sticks to it exactly. If your square foot formula yeilds a figure of $354.72 you're still going to round it off to $350, or $400, or $300, depending on how much you want the job and how right the price "feels" to you. If you have a 100 space lot that you get $100 per push for, and you know you're making money at it, I'd think you could be comfortable bidding a similar number of similar spaces at the same rate.
     
  6. KenP

    KenP Senior Member
    Messages: 197

    update

    I did some measuring the other day and the parking areas equal 470,000 sq ft. That doesn't't include the connecting roads or walkways. The customer is looking for an hourly price. While I have an hourly rate, I've NEVER bid a job at an hourly rate because there isn't any incentive in my eyes( I could use some insight into the hourly bidding). I'd rather put a snow pusher out there and blast through this joint and move along while counting my money.

    Also while I haven't measured the walks yet, I don't think they're as much a problem as I first thought, but there are a lot of dividers through the parking areas and the plowing will require a little more thought. Here's the kicker the customer would like all the snow from the encompassing road to be moved to two locations, so as not to burn up any turf along the curb line from the salt left on the road from the pretreating. Are there any treatment compounds out there that won't kill turf?
     
  7. phillyplowking1

    phillyplowking1 Senior Member
    Messages: 412

    You would be better off stickin to square foot on bidding on it. A snow pusher and 1 or 2 trucks for clean up sounds like it would be the perfect for that .
     
  8. KenP

    KenP Senior Member
    Messages: 197

    The problem I'm running into with my acre and sqft pricing is that it's either to way too high or way to low. What's everyone else using? I've got to run but I'll post my formulas later
     
  9. KenP

    KenP Senior Member
    Messages: 197

    More confused

    So where am I now with the bidding of this job? More confused than ever!!!! They now want the bid by man hour, I NEVER bid a job by the hour and to perfectly frank, I don't even know where to start. Any guidance would be great!!!! I'd love to have the account, but I'm really considering walking away from the bid, it seems just too complicated and my impression of the hourly rates is that you don't make enough money. Although this is a very large contract and if I bid it correctly I think it would be OK
     
  10. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    If you've explained to the potential customer the disadvantage to having hourly pricing and they still want it - then you'll have to decide if you still want to bid by playing their game. Maybe you have to bid the job to get it by the hour and then reengineer once you get it if they're open to your educating them.

    To work hourly short changes both you and the customer. How does the customer know that they are hiring a qualified contractor for the job? A contractor might bid $25.00 an hour and the price might seem great, but he might be using a small pick up with a 6' blade. If you can use a pusher you'll be off the site quicker and be able to position and stack snow better. The fact that you won't be causing traffic problems like a slew of plow truck will is beneficial to the customer. These things of course you already know.

    Regarding your formulas... since square foot pricing and per acre pricing should come out close since they are both based on the same concept (just different unit of measurement) your math or conversion factors might be off in your formulas. If the formulas are identical/similar, they should come out the same if you run the same data in each formula.
     
  11. wyldman

    wyldman Member
    Messages: 3,265

    Very hard pricing "per man hour",as it will depend on what piece of equipment he is operating.A lot of companies are trying to get pricing this way,as I guess they feel it breaks it down to a simple form they can understand.We have a few accounts priced "per truck hour",which at least gives them a figure,but if I go in and do it with a loader in an hour,they get billed for four,as that's what it would take if done with a pickup truck.

    Per acre or per sq\ft is pretty accurate for large,square open lots,but is difficult when you have a lot of obstacles or only certain areas where you can put snow.This is where you have to calculate it in your head,as to how much extra work it's going to be.If you've been doing it long enough,you can get pretty close.I don't get my wheel out to much any more,I do most of it by eye,or from the bid sheets.

    Lawn Lad made some excellent points,and you may have to do a little customer education to get the job,at the price,and pricing structure you want.It will pay off if you can.If they don't want to listen,then forget about it,it's not worth the hassle sometimes.
     
  12. Chuck Smith

    Chuck Smith 2000 Club Member
    from NJ
    Messages: 2,317

    I have been trying for years to come up with square foot pricing here. The prices are not even close on two sites that have the same area. I think I posted it before, that on large sites, it came out to $0.004 per sq. ft, and on a residential driveway, about $0.25 per sq. ft. I actually had one commercial lot work out to a penny a sq. ft. and that was the highest priced lot.

    I have spoken to other contractors that tried the sq. ft. route around here, and in some cases they were coming up with a price about half of what the lot was worth in reality. They would have gotten the account, but they could have made A LOT more money on it than their formula came out to.

    On the topic of bidding per space, I have seen $2 and $3 used around here. No add ons for entrances exits and lanes. Just the flat price used based on spaces. So I tried it on a site I already bid and won, and I would have been doing the work for about $600 less than I initially bid and won. I guess it boils down to too many contractors bidding from the hip, and getting "whatever flies", so there is no uniformity, like in spaces or square footage.

    As for the hourly, I would work up a bid like you usually do, with per push pricing. Then give them hourly rates. Then explain how the costs will be fixed, instead of them handing you a "blank check" to do the work.

    John Allin wrote an article that has been published many times, and in it he mentions that the customer really just wants to know how much it will cost to have the snow cleared. When asking for hourly rates, John says he will send 15 guys with shovels to do the job in a few hours. Per push, he will send a 20' pusher and be done in 10 minutes. Both will work out to the same cost for the customer. That is the jist of the article, I am not quoting verbatim....

    Since they are asking for hourly, I bet they want per ton pricing for salt too...... AND I bet they are used to paying for 9 tons of salt on a 1" storm on 1 acre of parking lot too.........

    To my knowledge, there is no granular product that won't harm turf and plants. The key is to limit applications, apply them with the right timing, and to keep them off plants and grass. CMA is the least harmful to plants from what I have read, and it is also the most expensive. Most deicers won't harm plants and grass if they are applied sparingly. As a preventative measure, you can apply Gypsum on those grass areas you don't want to burn, which might help limit damage. Talk to your local Lesco dealer about Gypsum.

    ~Chuck