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Snow contracts

Discussion in 'Business Fundamentals' started by jvm81, Oct 12, 2005.

  1. jvm81

    jvm81 Senior Member
    from Midwest
    Messages: 381

    I have recently received quit of few new small commercial accounts. What do some of you do or say when the client wants a contract for x amount. How do you know if your ahead, there ahead or even where to price it.
     
  2. Mick

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

    By "x" amount, do you mean he's telling you the price as in he's saying he wants a contract for $100?

    I'd tell him "Have a nice day". He tells me what he wants done, the conditions, etc, and I tell him if I can meet his needs and for how much.
     
  3. LwnmwrMan22

    LwnmwrMan22 PlowSite Fanatic
    Messages: 27,999

    I'm sure he means the client wants a flat fee.

    You have to do some research.

    Figure how many average pushes you're going to do in a year. Where I'm at about 30 miles north of St. Paul, MN, I base mine on 18 pushes / year.

    Then, sit down and figure out ALL of your expenses each month.

    Take this number and divide it by your average pushes / month.

    This number is what you need to make each time to plow, JUST to break even, and JUST if it snows your pushes / year or less.

    Now, if you want to go the easy route, double that or triple it, depending on how much your market will bear vs. your expenses, and that will be the number to shoot for, divided up by however many accounts you have.

    OR, you can figure out how much you are able to make / hour, multiply that by however many hours it'll take to clear the property, multiply that by the number of average pushes / year, and divide that total by however many months the agreement is for.

    Some years you'll break even with your expenses, some years you'll plow 1/3 of what you're paid to plow.