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Who gets paid in advace??

Discussion in 'Commercial Snow Removal' started by Govbradst555, Jan 22, 2009.

  1. Govbradst555

    Govbradst555 Member
    Messages: 56

    just wondering if u guys think it is normal for a lawn care company to take hundreds of thousands of dollar in advance for snow plowing.
     
  2. qualitycut

    qualitycut PlowSite Fanatic
    Messages: 24,227

    I know some people take money up front to cover salt costs on bigger properties.
     
  3. Blazin

    Blazin Senior Member
    Messages: 185

    I have one guy that gives me $500 the beginning of the year. If its a heavy snow year he will give me another $200, or $300 in Jan. Then pay the balance when the season is over.
     
  4. redman6565

    redman6565 PlowSite.com Addict
    Messages: 1,411

    never heard of a commercial property paying up front before...but it's an interesting perspective.
     
  5. ff1221

    ff1221 PlowSite.com Addict
    Messages: 1,327

    All my residential customers pay their contracts up front, pretty well all the contarctors in my area do it that way, it gaurantees their spot with the contractor of their choice.
     
  6. JeffNY

    JeffNY Senior Member
    Messages: 484

    Really?
    My one seasonal contract, I ask for the money up front. It paid for my salter.
     
  7. redman6565

    redman6565 PlowSite.com Addict
    Messages: 1,411

    ya i mean that would be nice to get a certain percentage up front, specially to pay for salt expenses
     
  8. Neige

    Neige Sponsor
    Messages: 2,197

    All our residential are pre pay. Commercial accounts, are payable in 3 or 5 installments. At the SIMA symposium I sat at a table where we discussed retainer fees. Some guys on big accounts ask for 20 to 30 % up front to cover the cost of buying their salt in advance. Makes alot of sense if you can do it.
     
  9. chcav1218

    chcav1218 Senior Member
    Messages: 954

    Some of my residentials ( a few members of a really wealthy family) pay me in sums of a few hundred dollars at once an just pay me again after i plow a few times. I always come out making more than if i charged them per push so i dont mind
     
  10. flakesmeangreen

    flakesmeangreen Senior Member
    Messages: 217

    I offer my residential customers the option of per push or seasonal, so I get some money up front. It's usually about 25% that pay up front. A friend of mine only offers seasonal/pre-pay.
     
  11. chcav1218

    chcav1218 Senior Member
    Messages: 954

    i tell people that if that want to pay up front, i'm going to have to price on the high end because i dont want to short change myself. but then again, if it doesnt snow, i get screwed
     
  12. MileHigh

    MileHigh PlowSite.com Addict
    Messages: 1,827

    I wish....
     
  13. Ipushsnow

    Ipushsnow Senior Member
    Messages: 314

    Annual/seasonal accounts have 2 choices:
    Pay 1/3 on November 1st, 1/3 on January 1st, and the final 1/3 March 1st.
    Or half December 1st and half January 1st.

    Customer feels secure not paying a huge chunk upfront, and I am happy having money roll in every month even if it doesn't snow. It seems to work for me.
     
  14. elite1msmith

    elite1msmith 2000 Club Member
    from chicago
    Messages: 2,762

    monthly, first payment is due Nov 1, next one is due Dec 1....


    and normally , we see very little snoe in Nov, if any at all.... and in the past you could get a week or 2 with no snow in dec
     
  15. NorthernSvc's

    NorthernSvc's Senior Member
    Messages: 766

    seems like the majority of the PM around here want seasonal contracts broken into 5 payments november -march
     
  16. Blazin

    Blazin Senior Member
    Messages: 185

    Mine are all residential except two small apartment houses three, and four unit places. I bill every three or four storms, plow or sand. Keeps the sticker shock down. That way they are not getting a huge bill or two per season. The guy that gives me $500 up front then $200 or $300, his end of season bill has been as low as $200 for a light year, and $600+ for a good year. Also have one place I do all winter, people are in Fla. When they get home they show right up at my house within a day or so and hand me cash for the whole season! Nice little pile of money to do something for myself with!!
     
  17. TCLA

    TCLA 2000 Club Member
    Messages: 2,699

    Is there really such a thing as paying in advance? Depends on your perspective.

    I suppose the resis and the all inclusives think they are when they (either) make their first payment in October, or pay for the year in November. But are they really???

    No

    There are real cost's involved when you start prepping equipment, purchasing salt, parts, equipment, meeting with subs, setting up and meeting with customers, staking sites, etc, etc, etc, etc..... months before the first flake thinks about falling.

    Maybe many here only have to hook up a plow on your truck and get a list of sites from the contractor who is giving you the work. Real cost's do exist before anyone performs a darn thing on a customers site.
     
  18. QuadPlower

    QuadPlower PlowSite.com Addict
    Messages: 1,056

    The CUSTOMER is paying prior to any service being preformed for them.

    Its like the McDonalds drive through. You ever got your food prior to paying for it? No. Did McD have expenses prior to your order? Yes.

    My seasonal customers pay everything up front. Eliminates having to bill them, eliminates them having to send out a check, eliminates their worry about if I show up too much. All I have to do is plow.

    It is harder to get more money if you don't put it in your contract for additional work.

    I went out yesterday and moved piles of snow with my little Kubota w/bucket. Would I have liked to charge my seasonals to do this? Yes. Would I feel right charging them without having it in my contract? No. I didn't charge them for a couple of reasons.

    1: I enjoy running it and moving snow. I went out mid day when I had ever thing else done.
    2: Moving the snow piles will make it easier for me next time to push the snow with my truck.
    3: I am charging my per time customers a "per push" rate to do it.
     
  19. JohnnyRoyale

    JohnnyRoyale 2000 Club Member
    Messages: 2,935

    All of our commercials pay in 5 or 6 installments. Salting and salt box fill up is billed every 2 weeks, removal or push back work is billed as it happens.

    Funny you mention that. I spoke with a few of my clients over the last week about the idea of prepaying their average salt usage from past years for next year to ensure availability at a fixed price throughout the season as A) salt is getting scarce around here now, and B) price has jumped through the roof. I was planning on bringing a few thousand tonnes in over the summer and sitting on it to help the situation, and for the most part, they're all on board. This way i wont have to bankroll the pre purchase all summer long. Time to start planning on the dome shelter to hold it all.
     
  20. JohnnyRoyale

    JohnnyRoyale 2000 Club Member
    Messages: 2,935

    Would I feel right charging them without having it in my contract? No. I didn't charge them for a couple of reasons.

    1: I enjoy running it and moving snow. I went out mid day when I had ever thing else done.
    2: Moving the snow piles will make it easier for me next time to push the snow with my truck.
    3: I am charging my per time customers a "per push" rate to do it.[/QUOTE]

    All depends how you word your contracts. I too enjoy running equipment...but it gets old pretty quick, and equipment and fuel and time = money, even if its my time. So would I do it for free-absofu&^kinglutely not. Sorry.