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Switched to Per INCH this year... looking at switching back.

Discussion in 'Business Fundamentals' started by PerfiCut L&L, Feb 17, 2006.

  1. PerfiCut L&L

    PerfiCut L&L Senior Member
    Messages: 178

    I changed our billing practices a little this year and went from a per push rate to a per inch rate. Thought it would benefit us in those cases where customers only want us to come out at a 3 or 4" trigger, or at the end of a storm of 5 or 6 inches. Unfortunately its caused more headaches. So I think we are going to switch back to the per push based on an average time to do the lot at our hourly rate.

    For those that have per inch brackets, 2-5, 5-10, or whatever... do you bill based on total snow fall regardless of how many times you clear the lot. Or do you bill based on the depth the lot is at the time you plow it. Say 3 inches the first plow, and 6 inches the second plowing.
     
  2. Mick

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

    I bill based on the total snow depth per snowfall in a 24 hour period regardless of how many times I plow the site. This allows me to decide how often I'll plow. I can let a light, fluffy snow build up or I can push a wet, heavy one every 3-4". The customer doesn't care as long as they can get in and out when they want.
     
  3. itsgottobegreen

    itsgottobegreen PlowSite.com Addict
    Messages: 1,351

    1 to 3, 3.1 to 6, 6.1 to 9, 9.1 to 12, 12 or over per inch. What I have used for the last few years. payup
     
  4. S-10 Plower

    S-10 Plower Senior Member
    Messages: 104

    Per Visit as Follows

    1-3" XX.XX
    3.1-6.0" XX.XX
    6.1-8" XX.XX
    8.1" + XX.XX Per inch over 8.1

    Hope this helps
    Mark
     
  5. PerfiCut L&L

    PerfiCut L&L Senior Member
    Messages: 178

    We did are doing similar to Micks way. Based on total at end of storm, this way, I can decide when and how often to plow it.

    I though by breaking it down into similar brackets like S-10 did, but I though the customers would complain, saying well... why didnt you come sooner before it got so deep.
     
  6. Mick

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

    Realizing every situation is different, how did that lead to more problems for you? If I knew the problems, maybe I could offer some suggestions. One thing I see that may be a factor is location. I'm in Maine where people are used to being temporarily "snowed in" and waiting for the plow guy or just driving over it to get out to go to work. I have one guy who plans for snowstorms by parking his car at the bottom of his steep drive and walking down to it. He doesn't even want me to come before 10:00 so he'll be gone and I can clean out his whole driveway. All my customers don't think anything about driving on 5-6" of snow. For bigger snowstorms, calling into work and saying you'll be there when you can get out is common. All they care is that it's gone by the time they get home in the evening. You being in Maryland, this may not be an option.
     
  7. FIREMAN Q

    FIREMAN Q Senior Member
    Messages: 242

    I decided that i wouldn't use the per inch method. The problem that I thought that I would have was actually determining the depth of snow. was it 3 inches or 4 (for example) i didn't want my customers to try and fight the fact that we only had 3. So what i did this year was to tell my residentials that I would plow every 4-6 inches. This way they would know ruffly when I would be there. My Commercials are on a 2/3-4 inch intervals. This has seemed to work for me with no complaints so far. Hope it was clear enough to understand. Good luck
     
  8. Mike from NH

    Mike from NH Junior Member
    Messages: 4

    I used to just go out toward the end to the storm, and offer the 2nd visit at 1/2 price if they called and needed it. The billing process is a total pain in the ass.Waiting up to 10-15 days for payment,and going to the bank to cash the checks. I considering getting back in the plowing business for the 06/07 season and I'm thinking of offering an "on call basis service", with no contracts and cash when they call. I used to have contracts and they are meaningless, if they dont want to use you at any given storm they can call and say they are all set. With the on call service, you know they will have their cars out of the drive way and cash in hand for payment. I also plan on making some signs for telephone poles (worked great in the past) and run a small ad in the newspaper.
     
  9. PerfiCut L&L

    PerfiCut L&L Senior Member
    Messages: 178

    The problem im running into isnt necessarily a debate over exactly how much snow is on the ground, but "why didnt we come sooner".

    Initially we were billing a flat rate based on the total snowfall depth at the end of the storm. Since in Maryland, most of ours storms are one day events, rarely do we get a 2 or 3 day storm. The problem with this for us is time management. After hours isnt too bad, we plan according to precipitation forecast, starting at about a 3" trigger on most lots. We will return for a second visit near the storms end, which usually is an additional 3-4 inches, since most storm here accumulate 6 to 7 inches at most.

    However, during daytime events, some some lots we spend much more time, keeping the lot open, since we cant must maintain a maximum of 2" of accumulation.

    Based on this, we make more money per hour for after hour events, than we do during business hours.

    We've tried the bracket system, but find that people want to know why we didnt come sooner before the depth reached the second or third brackets. Was just too much of a hassle.

    Im considering going back to either flat per push rate for small lots that take 1hr or less, and an hourly rate for the larger lots.
     
  10. Mick

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

    PerfiCut L&L, from what I'm reading about your situation, I'd agree that you need to - first talk to all your customers and understand what they want - then it sounds like the per push method like you're saying would work best. Understand where I'm coming from - I'm very much against plowing per hour as I see it as too limiting. There is no incentive to find ways to be faster on any particular site and you're never going to make more than your per hour rate.

    Next, I'd say you might consider your per push rates since you're accomodating your clients. How much are you making on a full trip of the route and is this satisfactory with you for any situation, including being out there in blinding snowstorms? Your customers also need to understand that you're not always going to be able to get around every 2-3". For instance, if it's snowing at 3" per hour. Maybe unlikely in your area but it could happen. BUT - you would be happy to dedicate one truck and operator strictly to this site for the right price.

    Just my thoughts.
     
  11. TLS

    TLS PlowSite.com Addict
    Messages: 1,425

    Here's how I've been doing it. No complaints in close to 20 years. This is for one of my lots....

    2-4" = $230
    5-7" = $280
    8-10"= $390
    11-13" = $460
    14" & Up will be priced according to storm

    This is for a lot that takes roughly an hour to plow and blow in the 2-4" range, another 15min to salt/calcium (thats extra, billed per lb.).

    Unless it's going over a foot, I'll wait and plow when the storm stops. If I do it twice, I'm covered anyway as far as money.

    Never had any complaints over how many inches fell. But then I never stretch the inches either. Around here most areas get the same amount withen an inch.