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Who caps seasonals?

Discussion in 'Commercial Snow Removal' started by forestfireguy, Jan 2, 2010.

  1. forestfireguy

    forestfireguy PlowSite.com Addict
    Messages: 1,276

    We won't do a seasonal without a cap. What do you guys do? We have bid sites where their specs call for no cap, but we were not in the mix as far as competitve pricing. We did bid one this season without a cap but submitted it as a 3 year contract figuring the average would play out. They went with a no cap one year deal. Oh well.........we're not in this to lose, I am really wondering what the rest of the industry is doing in this reagrd.
     
  2. ColumbiaLand

    ColumbiaLand Senior Member
    Messages: 790

    We cap our seasonals with the average amount for the area
     
  3. big acres

    big acres Senior Member
    Messages: 653

    forest... I agree with you totally... even to the multi year averaging out. We cap all seasonals with loader work and salt included... either by total season accumulation, hours, or tonnage. No cap on our townhomes... but make it up on skid work fir heavier winetrs.
     
  4. elite1msmith

    elite1msmith 2000 Club Member
    from chicago
    Messages: 2,762

    im a no capper. i figure if they are willing to gamble on having a light winter, i will gamble on the heavy one. I found i win alot more bids as a result of no cap. over a period of a few years it will all even out. some years you win, some you dont make as much as you would like, but over all has been a good thing

    i do offer a retainer contract which has basicly a seasonal price, plus a minimal price per push charged
     
  5. Camden

    Camden PlowSite Fanatic
    Messages: 6,598

    I can't believe clients would allow a cap on "seasonal pricing". Do you guys offer a refund if it's a dry year?
     
  6. mullis56

    mullis56 Senior Member
    from Indiana
    Messages: 824

    Camden - I'm with you!
     
  7. forestfireguy

    forestfireguy PlowSite.com Addict
    Messages: 1,276

    Allow a cap?? I don't know about you guys but to me business isn't a lottery ticket. Seasonal pricing is fair to both parties if it's capped, and the client gets fixed pricing for an average winter, would your doctor expect to be paid if there was a complication, your mechanic if the repairs were more difficult than normal? I'm sure they would. We offer a no snow garuntee, if people ask for it or we feel we need it as a selling tool. And what it means is: if our cap is 40"(it normally is, but we will customize) and if we don't get over 24" we will credit 20% of the seasonal snow contract price towards a seasonal landscape maintenance contract, under no circumstances will we refund actual dollars. Again we and our clients know we are providing an invaluable service in the worst and most hazardous conditions possible, in addition to providing an actual service our employees, expierience, equipment and devotion are protecting them from liability in case of an injury. In this economy people who in the past looked for seasonal prices have started to ask for bracketed per inch pricing and those who were per ton and per bag for salt have started to ask for per application prices.........it's a sign of the times.

    Again I question the comment allow..........we try to be flexible and give clients what they want and need, but the bottom line is this work is hard,miserable and expensive to complete, nevermind profit, our clients don't run our business, we do.
     
  8. Here in Toronto you'll be out of business fast if you had a cap on seasonal contracts. Here, seasonal means just that... Flat rate, unlimited plowing with a trigger... There are very few companies doing per push here as well because seasonal (without a cap) is the industry standard here...
     
  9. RepoMan207

    RepoMan207 PlowSite Fanatic
    from Maine
    Messages: 5,031

    I offer three different pricing options to my potential customers when bidding.

    Per Event

    Per Seasonal (with restrictions *cap) based on area averages.

    Per seasonal (w/o restrictions *no cap) based on area averages....and a little insurance just in case.

    Keep in mind I have the luxury of Subbing my ice management out at this point, so it is a bit easier for me for sure. There is undoubtedly more at risk when you have to shell out product on top of the labor. With that being said I would think you would have a formula to calculate your ice management costs just as you do your plowing and snow removal. Same principals right........

    Here is a cut out of one of my return accounts. This year was my first with all three pricing options, I was very surprised to see a majority of my previous customers jump to the higher level. Maybe I wasn't charging them enough to begin with huh....:rolleyes:

    Capture1.jpg

    Capture1.jpg
     
  10. forestfireguy

    forestfireguy PlowSite.com Addict
    Messages: 1,276

    I'm glad I'm not in Toronto.........

    But Repo mans form is a good example of what I meant, his last option unlimited service reflects what I was saying, we made our bid sure to cover us in a moderately bad winter, about 30% higher than a capped contract would have been. We were doing it on a larger scale so the dollars were considerably higher, but so would costs have been.

    Anyone ever buy insurance to cover losses on unlimited service seasonals............
     
  11. NW Snow Removal

    NW Snow Removal Senior Member
    Messages: 533

    thought about getting insurance, but it's basically betting on the weather and we try not to gamble. We balance our seasonals with per pushes and it works out. If we were 100% seasonal I would quit this business because i would never want to hope for no snow. especially now that greenland is so warm and we are gonna have wetter winters for the foreseeable future.
     
  12. martyman

    martyman Senior Member
    Messages: 281


    I put 20 major snow falls on my contract. I keep count of customers that call out of turn or too often and count those as plows...If they know there is a limit they will not take advantage as often.
     
  13. Indy

    Indy Senior Member
    Messages: 704

    What no $10. and up driveways Ryan:rolleyes:
     
  14. buckwheat_la

    buckwheat_la 2000 Club Member
    Messages: 2,254

    i could never get my customers to go with a seasonal with a cap!!!, kind of defeats the purpose, doesn't it, your customers take the risk of having a light year, but pay more if it is a heavy year??? Am i missing something, we do seasonal pricing (no cap), per push pricing, and retainer pricing (if anyone wants to see how our retainer works go to retainer thread posted in commercial) BUT seasonal with a CAP seems unfair to your customers
     
  15. buck95

    buck95 Junior Member
    from IL
    Messages: 1

    Nice web site NW Snow Removal
     
  16. Longae29

    Longae29 PlowSite.com Addict
    Messages: 1,954

    no cap here. if you're going to have a cap, and pay back if theres little snow, why not just do per push?. the added benefit of gauranteed money, coming in early, especially is worth the risk of an extra plowing or salting. know your averages, know what the tolerance is going to be, spell everything out clearly. seasonal with no cap isnt for amatuers, thats what hourly pricing is for.
     
  17. Bajak

    Bajak Senior Member
    Messages: 999

    All you can eat Buffet.... $14.99!
    $4.99 for every 3rd plate and all plates thereafter.

    Everyone in this area would consider it false advertising.:nod:
     
  18. sno commander

    sno commander PlowSite.com Addict
    from ct
    Messages: 1,061

    no cap here i think would have a hard time getting people to sign them. i like to keep my contracts as simple as possible. i qouted one guy on a "per push" and he called me back and said how much would you charge per pull lol :dizzy:
     
  19. LoneCowboy

    LoneCowboy PlowSite.com Addict
    Messages: 1,760

    exactly
    what a rip off
    that makes it a per push with a retainer.
     
  20. mullis56

    mullis56 Senior Member
    from Indiana
    Messages: 824

    "SEASONAL WITH NO CAP ISN'T FOR AMATUERS, THATS WHAT HOURLY PRICING IS FOR."

    Couldn't have said it better myself!:nod::nod: