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seasonal contract or pay per visit

Discussion in 'Business Fundamentals' started by fastxcr800, Oct 8, 2014.

  1. fastxcr800

    fastxcr800 Member
    Messages: 87

    What do most of you guys do for commercial accounts, a seasonal contract in which the customer pays so much each month for snow removal services or do you just charge per visit?
  2. Meezer

    Meezer Senior Member
    from Indiana
    Messages: 291

    Per push.payup
  3. dodgegmc1213

    dodgegmc1213 Senior Member
    Messages: 997

    depends on the site. to me condos, townhomes, malls ect. best bet is seasonal. banks, small businesses (like moms and pops places) ect. per visit. it also depends on what the customer wants or what you prefer
  4. LapeerLandscape

    LapeerLandscape PlowSite.com Addict
    Messages: 1,456

    We give the customer the choice, when quoting we put both numbers on there. For seasonal we take the per push price times the average number of pushes maybe bump it up a bit for insurance and let the customer decide.
  5. SnowGuy73

    SnowGuy73 PlowSite Fanatic
    Messages: 24,868

    Combo of each.
  6. derekslawncare

    derekslawncare PlowSite.com Addict
    Messages: 1,003

    I ONLY do per push. That way I know I'm getting paid for all the work I do.
  7. LapeerLandscape

    LapeerLandscape PlowSite.com Addict
    Messages: 1,456

    We have some customers we do a monthly fee year round that includes spring and fall clean up, lawn care and snow. Those seem to work really well.
  8. John_DeereGreen

    John_DeereGreen PlowSite.com Addict
    Messages: 1,715

    It depends on property size and owner preference. Anything over 4-5 acres I prefer strongly to have seasonal, as the investment to ensure they're covered gets much larger. Many of the large accounts in my area it's seasonal or nothing. Smaller stuff, banks, small office buildings, etc I don't care either way. I bid seasonal and per push and let them decide.
  9. fastxcr800

    fastxcr800 Member
    Messages: 87

    What is the best way to cover yourself for large snowfall events for example a blizzard that dumps 3ft or a winter with huge total snowfall amounts. Can/do you put a clause in place that the seasonal price includes up to ___ amount of total snow and ____ amount of snowfall in a ___ amount of time is extra?
  10. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    You can put what ever you want in your contract as long as your up front with the customer. Don't tell them 200.00 for the season and you get a lot of snow and call them telling they now have to pay extra.
  11. LapeerLandscape

    LapeerLandscape PlowSite.com Addict
    Messages: 1,456

    You can put what ever you want in your contract but getting the customer to go along with that would be tough unless you have a clause in there that benefitted them in the case of a light winter. Even then it kinda defeats the purpose of a seasonal contract. Most customers want it so they can budget their money every month.
  12. fastxcr800

    fastxcr800 Member
    Messages: 87

    I understand the purpose of seasonal for both sides of the fence, but in the event that we receive 70" of snow for the year where a typical season averages 35" there's gotta be something to help cover costs.
  13. TMLGC

    TMLGC Senior Member
    Messages: 207

    That's the gamble I guess. If you plow once all season are you going to give back a partial refund? If your doing a full year round 4 season package I know some people include something like " upto 15 plowing visits...." (Pick your # for your area) in the package and anything in addition is added into the next months bill. Those were mostly on residential though as they could be given the option to cut down on visits if they were approaching the max.

    In the event you get slammed and you hold up to your end of the bargain hopefully they will remember that next year and you can adjust your pricing up with documentation of your services from the previous season.

    My old boss had contracts and there were winters where he pissed and moaned how he probably lost money or barely broke even on some properties at the same time there were winters where he said thank god he had seasonal contracts because otherwise might not of made it through.

    That is the risk you take IMO. Build the contract for that one massive storm for your own piece of mind.
  14. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Its not so much as how much snow you get,its how many times out that cost you money.
  15. MSsnowplowing

    MSsnowplowing Senior Member
    Messages: 688

    That's one of the chances you take with a seasonal.

    If your really worried about it you could do this in your contracts:


    Seasonal price is averaged for our annual snowfall of 35 inches.

    If we have a season with an unprecedented snowfall of more than 50 inches -(you have to give them a little incentive to sign this, so you let them know you are giving them the seasonal price with additional inches of snow added to it) you will then be charged additional for plowing services.
    So much for every 1-3.9 inches of snow above 50 inches due to increased costs.
  16. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    How about you charge enough in the first place and then you won't have to worry if you get more snow the normal.
  17. MSsnowplowing

    MSsnowplowing Senior Member
    Messages: 688

    Very true but if you did that you would be overpriced every time and may never get any contracts because everyone else is bidding the average snowfall.

    He states they get an average of 35 inches a year.

    35 divided by 2 is about 18 plows

    70 divided by 2 is about 35 plows.

    Say your charging 100 a plow.

    $1,800 for 35 "

    $3,500 for the 70"

    If others are bidding around 1800 to 2000 and he is bidding 3500, who would you choose?

    Seasonal regardless is taking a chance.

    That's why you should go long term contracts for seasonal.

    One year you might take a bit of beating and another year you make money.

    Long term contracts will built in price increases Minimize the risks of losing your shirt.
  18. gc3

    gc3 Senior Member
    Messages: 713

    So say you get them to agree to a 3 year contract and after 2 years they tell you they're going with someone else. Even though they signed it what do you do then? Or do you send them something every winter just to remind them you'll be out as the 3 year contract stated?
  19. LapeerLandscape

    LapeerLandscape PlowSite.com Addict
    Messages: 1,456

    This can be argued all day, about 40% of our contracts are seasonal. On a hard winter with a lot of snow we make good money on the per push and still make a little money on the seasonal, on a light winter with not much snow we make good money on the seasonal and a little with the per push. Either way we let the customer decide. Are there really areas that have a 35 inch average that get 70 inches on an odd year, has that ever happened in your area.
  20. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Maybe if this is your only account you'll plow that many times. I get over a 100 every year and lucky to plow 20-25 times.