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Total per season, or cap plus per plow

Discussion in 'Introduce Yourself to the Community' started by Mowing & More, Aug 29, 2010.

  1. Mowing & More

    Mowing & More Junior Member
    Messages: 8

    I am thinking of offering a special of x-amount of dollars for up to 10 plowings for my lawn clients, and after 10 plowings charging a per visit fee for the rest of the season. Sounds good to me and ensures that if winter is bad, I get paid. Just wondering:

    -where can i go to get more answers on this particular question on this site?

    -what do you guys think? Ideas welcome (ie- $200 for season up to 10 plowings, after 10 plowings a 24 hour visit is $20). ***Not actual rates**
     
  2. plowatnight

    plowatnight Senior Member
    from Mn
    Messages: 305

    OK Folks, this is my point, Just because you have a customer doesn't mean you have a birth rite to "ensures that if winter is bad you still get paid" What is going on here is you want a welfare check if it doesn't snow. You are betting the customer will get screwed and the customer might be willing to bet you'll get screwed and sign up. Does this sound like a healthy business relationship ? ?
     
  3. Mowing & More

    Mowing & More Junior Member
    Messages: 8

    Uh...let me rephrase what I am saying because I am not implying a "welfare" scenario. What I am saying is the client pays x-amount for the season that gets them 10 plowings, after the 10 plowings are used up, they have a "per push rate" that covers a whole 24 hour period. 10 events might be a bit to conservative and I am willing to adjust. I just don't like the scenario of charging (lets say) $200 for a season and then having 20-30 events. Just trying to optimize or play with ideas.
     
  4. plowatnight

    plowatnight Senior Member
    from Mn
    Messages: 305

    OK Sorry maybe that was a bit harsh, I'm just sayin', Why do you need a seasonal sale if you feel reasonably certain you get say 15 plowable events a year? Do you need the cash up front to get through the winter? In 12 yrs. plowing on my own, I've never sold a seasonal contract. I retain 98%+ of my people year in and out, and average very similar $$s throughout the years
     
  5. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Here we go ,I do seasonal only. The problem I have with a split contract like that is some guys will try and plow all 20 pushes in 2 storms so they can move to the second part of the contract.
     
  6. Mowing & More

    Mowing & More Junior Member
    Messages: 8

    Thank you for you insight everyone. I am new to the site and just want to gauge if seasonal only, per push only, or the combo I have presented - which of these will net me more accounts. Guys in my area are doing anywhere from $175 - $225 for a standard double stall drive that are in subdivisions (say 50 - 70 feet long) . I am thinking that if a person is presented with plowing for $175 versus $225 for the season, they are going to gobble up the lower price. Then I am thinking "How the hell can these guys be making any money?". Now I understand that there is the dilemma nationwide of low balling and undercutting and I am trying to stay out of that.

    Maybe the combo idea with either a great garuntee for plow times and service and/or a 5% early sign on discount. Or maybe this garuntee and/or discount with the per season or per push?

    I am really interested in getting someone to bite when they see the direct mailer I am putting out and you veterans are doing some things right. Not asking for your secrets, just advice, and do not want to get on your bad side like Michplower has seem to have done. Thanks again for any insight.
     
  7. TCLA

    TCLA 2000 Club Member
    Messages: 2,699

    Would love to see those results...should be a toss up between the seasonal and per-pushes that will net you more accounts.

    Your "combo" option is better for you...not your customer. I'm guessing this will net you far less...

    I would not take the chance and pick the per-push option if I wanted to budget my money and know what my costs for your service would be for the entire season.

    If I were a betting man and believed that we were in store for a light winter, I would choose the per-push option hoping to beat the odds.

    What advantage would I have obligating myself by paying a guaranteed amount, with a per-push charge built in after only 10 pushes? Just can't see this as a viable option for me (your prospective client).

    Now if I wanted to beat your system, I would take this third option and TELL YOU when I want to use my 10 pre-paid pushes....and they won't be on the wussy 2-4" snows either. If you won't budge on using your discretion when you plow....I would not consider this an option for me (again, your prospective client).
     
  8. Mowing & More

    Mowing & More Junior Member
    Messages: 8

    Thanks TCLA. Good perspective. What do you think an average for events are in Michigan? I was thinking 12-15. Am I low?
     
  9. TCLA

    TCLA 2000 Club Member
    Messages: 2,699

    That average is good for many areas....

    The west side of the state tends to get more lingering events and more snow depths than we do here.
     
  10. Mick76

    Mick76 2000 Club Member
    from Maine
    Messages: 2,157

    Just give your customers a choice of per push or seasonal... try to get a 50/50 split that way if you have a light winter your seasonals more then make up for your lack of per push income...... simple....
    don't over think things
     
  11. mnlefty

    mnlefty Senior Member
    Messages: 970

    I know of at least 1 competitor here that does things this way, based on 17 event average and we'll use an imaginary $30 per push:

    Per push contract: minimum of 12 events, they collect at least $360+ $30 each time over 12.

    Seasonal: price based on 17 events 17x$30 = $510 seasonal, up to 21 events. Over 21 billed at per push rate. So if it's slightly above average the customer gets up to 4 free pushes, if it's way over average the plow guys are covered.
     
  12. TCLA

    TCLA 2000 Club Member
    Messages: 2,699

    Creative! Mulch better options for both sides.....:salute::salute:

    Do they return $$ to their per-push customers on unused pushes since it's a pre-paid deal? I like the idea of getting pre-paid on per-push clients.

















    (mulch use based on 2cor reminder :laughing:)
     
  13. mnlefty

    mnlefty Senior Member
    Messages: 970

    I would doubt any $$ is returned for two reasons:

    1st, the 12 minimum is basically a retainer to insure the customer that they will have snow service when needed.

    2nd, I would guess that the chances are very slim that we'll have less than 12 events in a season, and I would bet they will plow almost anything during a slow winter to insure that the 12 events are reached.

    I am planning to incorporate some of this into my contracts this season, just haven't worked out the specifics yet. The majority of the customer base is the type that is more concerned with guaranteeing that it gets done on time, every time, versus squabbling over "I paid for x plows on the contract and you only plowed y times."
     
  14. TCLA

    TCLA 2000 Club Member
    Messages: 2,699

    Kind of breaks the spirit of a per-push agreement, eh? Nice slight of hand......

    Not knocking it...and again love the idea of getting per-push money up front.
     
  15. plowatnight

    plowatnight Senior Member
    from Mn
    Messages: 305

    Are these new customers, or ones you've had in the past?
     
  16. Mowing & More

    Mowing & More Junior Member
    Messages: 8

    How about this:

    "(X amount dollars) for the season that covers 15 events at 2" or more. Any additional plowings will be 10% of your total seasonal rate per plowing event."
     
  17. TCLA

    TCLA 2000 Club Member
    Messages: 2,699

    I would suggest changing "events" to "pushes". Many will define event as the total measurable depth from one snow storm. It's not unusual to have a snow event lasting 18 or more hours. You may very well need to plow 2-3 times during one long "event".
     
  18. mnlefty

    mnlefty Senior Member
    Messages: 970

    Yeah, I guess that would be better desrcibed as a "modified seasonal", or a "seasonal plus" contract.

    I just bought the company this spring, and the customers have been plowed by somebody else previously, as the previous owner of my company did not do snow

    That means they're paying more over 15 than they did for the first 15? (imaginary numbers) 300 for the first 15 is 20 per push. Then after that it becomes 30/per (10% of 300). That means you get the deal both under and over...
     
  19. theplowmeister

    theplowmeister 2000 Club Member
    from MA
    Messages: 2,549


    NO
    $300 for 15 pushes = $20/push

    after 15 pushes the prise is $20 - 10% or $18
     
  20. bighornjd

    bighornjd Senior Member
    Messages: 249

    I think if you want a seasonal contract, you should offer a seasonal contract. X amount of dollars for the whole season. Snowfall totals and number of pushes should be a moot point for both parties. Come up with a good average that you are comfortable with and set your price. None of this minimum maximum crap. Get a mix or per pushes and seasonals and you will make out OK regardless (unless your a lowballer). IMO you either have all per push and the ability to bank the cash from good years to cover the light years or all seasonals and bank the savings from a light year for the big snow years. OR, you can have a mix of both and allow the two to offset each other within the same year. You have to take care of yourself but on the other hand you should be in business to take care of the customer as well. All this other nonsense seems like smoke and mirrors to me that only benefits the contractor and uses trickery to make the customer feel like their screwing is a good deal. Keep it simple and price it right and it shouldn't be an issue.