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Pricing troubles

Discussion in 'Introduce Yourself to the Community' started by montanazach, Sep 2, 2015.

  1. montanazach

    montanazach Junior Member
    Messages: 10

    This winter will by my first winter operating my own snow plowing business. I have most elements of my business worked out except pricing. I am planning on exclusively offering residential plowing with sidewalk shoveling and salting. I was thinking of offering a couple different pricing options but was wondering what everyone thought. 1) A monthly fee that provides as many pushes needed at one base rate, these monthly contract customers would have services before 7am and 530 pm ( so before they leave for work and before they arrive home if needed) which would give incentive to take the monthly contract. or 2) A one time push fee but these customers I would service in the meantime while i am not taking care of the monthly customers. That was my idea what do you guys think?? Any other ideas? How does everyone else price residential jobs. I want to get as many monthlys as possible as this winter may be a lean one here in montana. Thanks and appreciate your input

  2. dieselss

    dieselss PlowSite Fanatic
    Messages: 10,749

    So your going for "done by 700am"
    And what if you get a lot of customers that want this. How are you going to get the proper coverage? What if it's 715am and your not done with the "privileged" drives and a "less fortunate" calls and needs there walks done......then what?
    And when your customers find out that this is going on how are you going to explain this?

    Why are you offering salt?

    You have the proper insurance correct?

    Backup plan?
  3. andersman02

    andersman02 Senior Member
    Messages: 697

    Dont like this idea at all, too many factors in snow removal to say youll be done at a certain time.

    All of our resi are told they will be done within 6 hours of the ending of an event. larger events will mean multiple trips. We have customers that ask to be done by "630 am" because there husband NEEDS to get to work..... If you cannot get out of your drive with 2-3" snow then no way your making it to work.

    We also reverse routes each storm so people arent last everytime. I don't understand the thinking that per push customers are less important. If pricing is right, your should be making great money on the per push people along with the seasonal people unless its a heavy year. They shouldnt be getting less service just because they are per push. unless you are giving them some ridiculous deal...
  4. JustJeff

    JustJeff PlowSite.com Addict
    Messages: 1,943

    Sounds like you're late in the game to me. It's September, and you don't know how to price yet, which also means you haven't even begun to get customers signed up. And I believe it can snow in Montana in late October, correct?
  5. bodaggin

    bodaggin Banned
    from Canada
    Messages: 29

    Price monthly based on 3x record snowfall. You'll never get burned by excessive snow years. Technically the way to sell this is as "snow insurance" as opposed to snow removal. The customer pays a monthly fee to have no snow in their driveway so it doesn't matter if that is because you cleared it or it never fell. Piece of mind is the selling point and most people hate snow so they won't complain if none falls even though they pay (some will, most won't). They don't complain they paid $2k a year for car insurance and never needed it, same thing for snow insurance (removal).

    Base these prices on the market rate in your area and your time required. Different types of clearing will yield higher profits than others based on market rates. Focus on the higher yielding niches (whether that's sidewalks, plowing, commercial; you do the research in your market). You don't need to lowball, or highball prices. Stick your prices at the market price so people buy from you.

    This is snow removal. Simply showing and doing the work is competitive advantage in this industry so you don't need to have a master creative plan.

    Per push will never be as profitable as monthly clearing because you have to admin every time you clear for every property. My monthly's go through automatically on credit card so it's 0 admin on my part except setting up the initial payment plan. It snows 25 times a year here. Imagine going to each of your customers (say 30, 50, or 200 customers) 25 times to bill and collect payment. You'll spend more time chasing for cheques, answering the phone, and writing invoices than actually clearing snow. Monthly is the only way IMO.
    Last edited: Sep 2, 2015
  6. montanazach

    montanazach Junior Member
    Messages: 10

    Ok so here is where i am. Im currently living overseas. I will not be home (montana) until december 1st. I have a plow and a truck and i am currently getting all the insurance and and registering my business which will be done by the time i get home. I was planning on focusing on residential because december is way too late to even think about pursuing commercial. This is why im having trouble with pricing because it will be too late to get a seasonal contract with anyone. Now i know this isnt ideal but i think i can make it work. If anyone has any ideas how to best pursue this im all ears.

    Bodaggin i would really like your advice on this
    Last edited: Sep 2, 2015
  7. theplowmeister

    theplowmeister 2000 Club Member
    from MA
    Messages: 2,515

    So people on monthly will only want to pay Jan and Feb in march the snow melts the next day same for Dec.

    You can do a 7:am guarantee I have for 20+ years with 100 drives 2 to 3 jeeps and missed it once.

    I used to charge by the storm fixed rate for 1 to 6 " and by the inch over that. then I went to seasonal contracts, now seasonal with extra charge for over 6"

    I would not due some at 7AM and others not then your backtracking drive down a street once.