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Total Nebie Question's =)

Discussion in 'Business Fundamentals' started by Kiso, May 15, 2008.

  1. Kiso

    Kiso Junior Member
    Messages: 3

    OK, so I'm putting together my business plan to bring to the bank for my small business loan. But I have a few questions on somethings that I haven't been able to find throughout the forums. But If there is a post covering these questions maybe "stickyin" it would be a lot easier for some.

    Now with the mind set of a one man business with hopes of expansion in the coming years.

    But this is the initial plan for the following year.

    Snow Removal (Driveway Truck Plowed, Salt, Walkway's Possibly 1 or 2 Commercial accounts if available)
    Lawn Care (Residential Mow w/Commercial Rider &Trim work)

    How does a person judge an account? I imagine you have Per job, Half Year & Full Year based on season schedule. I've gathered a one shot Plow will run you from 30-40 Dollars depending and a single mow from 25-45 Dollars depending.

    How do you come to your figures on what you charge per person for a year or half year job? I imagine that each person's cost will depend on size. Is there an equation that is used or is there a "Norm" that people go by then add to depending on the size difference? Basically is there a flat rate that you go by other then your demographic that affects your cost per person? I know with commercial accounts you bid for them. With Home owner's it's basically the same thing will hopefully less competition. So again, this question imply s for both seasons.

    I know that plowing is based on snow fall and is only when needed. But with Lawn Care and people with "season passes" how do you judge when to mow again? I know that having a schedule is more then half the responsibility of this job.

    How many accounts should I try to attract being a "one man business"? For each season for that matter. I'm Hungry to earn and expand but I also don't want to over schedule myself. With putting a business plan together they kinda need to see how many people I'm attempting to work for.

    Wanting to make this business official should I go with an LLC? I've heard a lot of good things and bad things about them.
     
  2. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 8,512

    Yes, you need to organize your business an LLC is a good choice.
    Get your self a good lawyer and or an good accountant and they will help you decide if a LLC is right for you.

    What about Insurance?


    It sounds like you have never plowed before?
    A better route to go would be to work for someone else and learn the ropes first. You seem to have the cart before the horse.

    Hear is a link that will help you with figuring out your costs.
    http://snow.grounds-mag.com/ar/grounds_maintenance_pricing_right/index.htm[

    Hear is one for your methouds...
    http://snow.grounds-mag.com/ar/grounds_maintenance_august_3/index.htm

    Your Q's, are right on track but with out experience in the industry I do not think that any bank is going to give you a business loan.

    Another route to go is to get a late model 3/4 ton truck and then get a good plow (at least 8ft) and a tailgate spreader Then work for someone and watch and learn.

    Snow removal= means removing the snow from the site.
    plowing = the act of clearing the lot or drive of snow.

    Lastly ask your family if it is ok that you miss Thanksgiving, Christmas, birthdays or anything else because you have to go plow.
    Do you like getting up at 1am?
    Working for days with out much if any sleep?
    Do you LOVE snow?
     
    Last edited: May 15, 2008
  3. Kiso

    Kiso Junior Member
    Messages: 3

    I think you greatly for your reply and your insight. I've plowed once in my lifetime and being a night owl myself figured it is my "calling"

    I have never "Gone" for anything in my life. Never gave anything my all. I feel very strongly in my heart that this is the profession for me. That I can excel and grow with a business such as this. And I have high aspirations for future expansion.

    Thank you for teaching me about the difference between plowing/snow removal.

    I've never been the sentimental type for holidays and now being disabled I am out of options as to was I can do to earn a living and support myself and my son. I've came to the conclusion that snow plowing is perfect for me as I have problems standing, walking and sleeping. Don't mind the hours and love Sirius radio. But a clean driving record and a safe driver =) LOVE the cold, hate snow. So I'd like to be the "Snow Killer" for CNY!!!

    I haven't purchased any gear at the moment because I want to make sure I get what I actually need and not have to run around later trying to get what is actually needed. I'd like to have this kick off in January of 2009. Is this hoping for too much? Or should I give myself more time to get my affairs in order?

    I plan on investing 10k into the business. Figuring that anything that I need (other then the truck) that the truck can be used as collateral . Would you recommend that I buy the truck on my own and use the 10k for start-up costs (ie. plow, salter. salt, other equipment?) or use the truck for collateral?

    Thank you for bringing up insurance. Adding that to the business plan I've only guessed at around 1200 a year, if this is wrong the correct amount would be greatly appreciated.

    Also as I know that it's illegal but is there room to pay people under the table (for insurance reasons) as an operator. I would work for someone to learn as long as I know it didn't jeopardize my current situation. If you or anyone is local and interested in this kind of project I'm eager to learn.


    Thank you for your time SnoFarmer, I really do appreciate it!!!!!
     
  4. Plowin in VT

    Plowin in VT Senior Member
    Messages: 233

    Just a couple quick thoughts....

    Starting in Jan '09 will not work, at least for plowing - my contracts start mid-October or November.

    Plowing will definitely cure insomnia! After being up for 36 hours, you'll sleep like a baby!

    Another thing to consider is if your customers will want you to shovel sidewalks, which it sounds like you might not be physically able to do. If you can not shovel, then that will knock you out of the running for quite a few jobs (or at least most commercial ones). If you do get jobs that require shoveling, you would have to hire someone to shovel for you, which is less $$$ in your pocket.

    Do not think about plowing without commercial insurance, for both your truck, AND for your business. Insurance on your truck will cover you for any damage you may cause while plowing, and the insurance on your business will cover any slip/fall claims. $1,200/year sounds a bit low for both policies, but then again, I'm not in Syracuse. Call around to several agencies and see what prices they can get for you. Keep in mind that you will need to get a commercial insurance policy on your truck, as most regular policies will not cover you if you plow any place other than those owned by you.

    Pricing - $30-40/push seems a bit low, but I don't know your market, and I also primarily deal with commercial lots. Is that the average price in your market, or just a number that you think would be fair? Make sure to keep in mind that $30-40 for a 5 minute job may seem like pretty good money, but you also need to factor in fuel driving to/from the location, insurance costs, maintenance/upkeep on your truck (plowing can be very hard on them). If you get 10 driveways that are very close to your house AND to each other, then yes, that could be a good price, but if you have to drive 10 miles between sites, then that drastically increases your cost.


    How many accounts should you start with? That all depends on you. Your first year you should start slow. Get to know what you are doing, and then start taking on more clients next year. The last thing you want to do is piss off a lot of people when you can't keep up.

    Good luck,

    Evan
     
  5. hydro_37

    hydro_37 PlowSite Veteran
    from iowa
    Messages: 3,790

    Alot of great replies and I will add a couple too.
    If walking and getting around is a problem then loader a sander or shoveling will be a BIG challenge.
    Being mobile will save you alot of time if you get stuck (and you will).
    I applaud you for your efforts and wish you the best.
     
  6. elite1msmith

    elite1msmith 2000 Club Member
    from chicago
    Messages: 2,762

    my 2 cents....

    dont get into plowing to "start" ur buisness, its fine as an add on after you get rolling, even in the first year...but alot of landscapers , will and have been made or broken by their plow jobs..

    start with the lawncare, if july, August rolls around, then get a plow and go from there, planning is great, but dont try to be too big too fast, or start getting loans for equiptment that you dont have work for at this time..

    start with flyers in the spring time and go from there..you get a job, or an account, then buy only the bare nessesary equitment to do that 1 job... Semi (good shape) used equiptment is ok, while ur small and growing, with 10k, I could get you a decent 2500 truck, small trailer, commercial mowering equipment, and maybe a used plow..if you take ur time and shop wisly

    remember, start small, and only get the stuff you need, way too many ppl in this industry buy the biggest baddest truck or mower simply to have, they paid 45,000 , i paid 12,000 and mine does the job just as good , just as fast....they all break at somepoint, even the new ones

    i would start by getting lawns to mow and go from there, buy a used walkbehind mower for $1300, a trimmer , blower and small trailer,...tow it with what you have now, if u have a truck or suv....pay for that equiptment, then upgrade ur truck,...

    bottom line,...get the accounts then the equiptment...dont get in over ur head, and but the tools and equitment that DIRRECTLY make work happen and do the jobs, save the money on the things that dont... example or this my plow Dirrectly, makes me money, however the strobe bar you may want to mount on ur truck for $600 plus, does not make money, and a $150 does just fine in most cases..

    just a thought from a little guy...with 15 yrs in the industy
     
  7. dieselboy

    dieselboy Member
    Messages: 43

    I wouldnt jump into any commercial accounts with seasonal contracts right away. Those can be a nightmare real fast. especially in syracuse. so for the first year i would stick with per push accounts. And dont be afraid to tell people no if there driveway is from hell. I learned that one the hard way. some driveways just arent worth it.
     
  8. Dissociative

    Dissociative 2000 Club Member
    Messages: 2,066

    Yes.............., Yes................., YES!!!

    Sorry, had to do it..lol...
    good luck....wish i was more help but here's a bump anyway..
     
  9. krazeehorse

    krazeehorse Member
    Messages: 31

    Start out slow. I think you'll find that sitting in the truck for extended hours plowing is more physical than it sounds.
     
  10. Charles

    Charles Moderator Staff Member
    Messages: 256

    Please keep this to Snow plowing only. For your questions on Lawncare part of the thread, try our other site: http://www.lawnsite.com/
    thanks!
     
  11. LawnProLandscapes

    LawnProLandscapes PlowSite.com Addict
    Messages: 1,129

    you sure your going to be able to endure the physical aspect of this line of work? not trying to discourage you, plus i dont know what your disability is but just make sure you have really thought this through... jmo
     
  12. RLM

    RLM PlowSite.com Addict
    Messages: 1,270

    Check & double check your numbers with your market. We aren't that far (Rochester) & have relatives in your area, your pricing seems WAAAAY high for the market. If you can get it more power to you.