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stick with residential or go commercial

Discussion in 'Introduce Yourself to the Community' started by jonny72888, Apr 30, 2015.

  1. jonny72888

    jonny72888 Member
    Messages: 58

    Its just me and a truck (3/4 with a fisher xv2) and one of my friends if trying to get me to get some parking lots with him(1/2ton with a 8'). Not sure if its worth it or not. We have access to a bobcat to push banks back if needed but would have to sub out the salting of the lots. He has a lead on 6 lots. the smallest is 75,000sqft and the biggest is 150,000sqft. We would have to take all 6 lots or non. I would need to get $1,000,000 worth of insurance which would cost me $2600 per season. He would also have insurance and then we would have to pay to have it salted. I dont think its worth it. I have 12 driveways I would have to give up to do the lots as they are not really close to eachother. I make $580 all cash every pass with all the driveways (every 8in). So its not that bad. Takes me about 5 hours to do the whole route. This year I was going to go up on the price as well.

    So I guess what my question is... Is there going to be that much more profit on the lots to make it worth the switch? Im not sure what we are going to charge to do the lots but we need to figure out a cost per sqft and bid on all the lots as a whole. So right off the bat we will have $5200 in insuance cost ( guessing his is the same as mine) and then it might not even snow.

    What do you guys think/do?
  2. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Were should we start. I know,lets talk more about your insurance.Want to list what you have now?
  3. jonny72888

    jonny72888 Member
    Messages: 58

    Now I have a rider on my auto. It's like $150 for the year and covers me upto $10000 per accident. With a $500 deductible.
  4. dieselss

    dieselss PlowSite Fanatic
    Messages: 10,754

    Why would you sub out the salting?
    Last edited: Apr 30, 2015
  5. jonny72888

    jonny72888 Member
    Messages: 58

    I don't want to put a salter in my truck.
  6. jonny72888

    jonny72888 Member
    Messages: 58

    I'm content with the driveways. The way I look at it is, I have the truck anyway, the plow is paid for. So it doesn't cost me anything to do them. He just tells me there is a lot more money in doing the lots. Not sure if there is or he just needs me.
  7. thelettuceman

    thelettuceman PlowSite.com Addict
    Messages: 1,216

    Keep the residential and forget the rest.
  8. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    So you have commercial plowing insurance on your truck. Good if you hit something.not enough coverage though. So how much in general liability insurance do you have. But since your only plowing for beer and pizza money you probably don't have any.
  9. cet

    cet PlowSite Fanatic
    Messages: 7,196

    Why are you both insuring those 6 sites? Are you going to get a joint company? If either he or you insures it you should only pay the 1 insurance.
    There is good money in salting, no way I would sub that out.
  10. jonny72888

    jonny72888 Member
    Messages: 58

    I just don't want the salt eating my truck. I have friends who salt and they go through trucks fast. I have a new truck and would like to keep it nice.

    They require a million dollar policy for each vehicle. They are both commercial trucks. Don't know what that other guys issue is but it's not beer and pizza money. I own a electrical company and he's a plumber. I'm guessing that my liability insurance would cover me while plowing. I just sent the requirements from the building owner to my insurance company and they said what I needed. Since when did this become about what I use the money for? Winter is when work slows down for us so it's nice having some extra income.
    I would appreciate helpful comments not negative irrelevant ones.


    We do not insure the site but the truck for damages it would cause. So if someone slipped they would go after the building owners insurance.
    Last edited: May 1, 2015
  11. dieselss

    dieselss PlowSite Fanatic
    Messages: 10,754

    We do not insure the site but the truck for damages it would cause. So if someone slipped they would go after the building owners insurance.

    They will go after you as well.
    And you answered your own question, stick to residential
  12. jonny72888

    jonny72888 Member
    Messages: 58

    From what he said we are going to be employed by him directly. So we will be getting pay checks not a 1099. I'll have to have my insurance agent look at it for me. Thanks for bringing that up.
  13. dieselss

    dieselss PlowSite Fanatic
    Messages: 10,754

    So your insured by him for his sites, but what if you damage property at a different site? How's that going to work?
  14. 1olddogtwo

    1olddogtwo PlowSite Fanatic
    Messages: 11,396

    Who is he? The site owner?

    2+2 isn't adding up for me.

    Salting is more profit then plowing.

    You really should have a GL in place already......you really never know what or who you'll hit.

    If you are receiving a paycheck you are an .....employee of his company....therefore you should be covered under his insurance to an extent.

    I hope ur hourly rate is super high (over 145.00) cause tax man will take 40℅.....and good luck.

    I think we need more good info to provide you a path.
    Last edited: May 1, 2015
  15. Randall Ave

    Randall Ave PlowSite.com Addict
    Messages: 1,446

    What Olddog said, and if its really coming down hard how are just the two of you going to keep up. You are going to get creamed in taxes. If your an employee he has to have comp insurance on ya also. Try it for a year, if your an employee there's no contract, you can walk if you didn't make enough.
  16. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    In you'd first post you talk about getting cash. Makes me think beer guy.you never said you Ian another company and want to add snowplowing. As for insurance.bumping up your insurance shouldn't cost much more. What do you have now? If you don't have a partnership then one of you need to be the owner and pay the other as a sub as for salting pick up a scraper and put a Salter on it. And any big company will require general liability .
  17. theplowmeister

    theplowmeister 2000 Club Member
    from MA
    Messages: 2,516

    I looked into going commercial, but I didnt want to take a pay cut.
  18. jonny72888

    jonny72888 Member
    Messages: 58

    Sorry been away from the comp for awhile.
    I told him no after we talked numbers. It would have come down to $300 a hour. Not worth it.

    So how it would have worked... myself and my guy would have been put on payroll at the one of his buildings. They would call us in to plow so we would clock in and out. I would only have to provide liability insurance for my truck. I would be covered from someone falling under the building insurance. That part was good with me it was the pay that was going to be bad, Ill have more profit doing the driveways.

    What I meant by cash was people dont claim their driveways getting plowed on their taxes so I will go to their bank and cash the checks. I own a electrical company so in the winter I stay busy with this plus work. So I have workman's comp and liability already.
  19. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 7,930

    Still some home owners will want a receipt.

    What happens when their bank requires you to open an account first? Just because it was written on a account at that bank doesn't mean they just have to cash it.

    & the tax man wants his money.
    Why shouldn't you pay taxes, just like the rest of us?

    Now you have told the world you plan to evade taxes.
    Your competition will now turn you in.
    Get ready for the audit.payup:waving:
  20. jonny72888

    jonny72888 Member
    Messages: 58

    I do pay taxes if I get a check written to the business but if they make it out to me or pay cash I'm just like everyone else.
    I bet you claim all the cash you take in right?