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Acquiring new commercial accounts help

Discussion in 'Business Fundamentals' started by giggity, Aug 26, 2016.

  1. giggity

    giggity Senior Member
    Messages: 169

    Looking for some advice on advertising/marketing for new accounts. Ive been in the plowing industry for 15 years, Ive always had 3 of my own small commercial accounts, and also worked as a sub for another company. Im looking to expand this year and pick up a few more of my own accounts. Can anyone give some helpful pointers on the best way to advertise to potential customers?? Im looking for commercial accounts, in the past ive done mailers, and have went door to door, any other ideas? Also what is the best way to get on bidding lists with property managers? Thanks for any help!
    smaduri likes this.
  2. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 9,883

    After 15 years I'd hope your getting referrals from your present clients.

    Mailers only work for residential but are not very good for achieving a tight route.

    Go introduce yourself in person, with a bid in hand, let then know that nothing is set in stone,
    And your eager to hear back from them.
    Defcon 5 likes this.
  3. shawn_

    shawn_ Member
    Messages: 71

  4. LapeerLandscape

    LapeerLandscape 2000 Club Member
    Messages: 2,247

    Like Sno said for commercial accounts go in person, ask if they are taking bids for snow removal. You dont have to have the bid in hand, just ask what is the best way to turn a bid in rather it be email, fax, mail or come back and hand deliver. Just be prepared be turned down a lot, you could turn in 10-20-30 bids and maybe get one job. Dont lower your price if your not getting jobs, a lot of people just like the guy they have even if he's a little higher.
    shawn_ likes this.
  5. Doin_It

    Doin_It Senior Member
    from Mt.
    Messages: 136

    Commercial is all about either calling the management company or finding out who owns the building and calling/going to see them.

    Last year I was just driving to meet my cutting crew and saw an old guy and a teenager, who turned out to be his grandson, trying to unload a riding mower, so I got out and helped. Turns out he owns 4 commercial buildings within a 3 block radius of a large one we plow. We plow all 4 now. There a lots of buildings owned by just 1 guy, not some large corporation. Just have to fine them by going door to door and asking who owns the building. I hit a few doors where each guy in the building owns his own bay and they run it themselves, so yea, start knocking.

    We picked up one from a multi national leasing company just from a phone call off the sign on the building. Never meet the people from the leasing company till the day I went in to sign papers, we did it all over the phone and emails. They phoned the Costco we do and that was a good enough reference. His words were, "if you're good enough for Costco, you're good enough for us"......now we've got 28 acres in that site alone and Friday he emailed and has a 12 acre site he wants bid on.

    So to me it's having a very good reference and just start calling. Personally, I always call the multi nationals first to see if they are looking and I have 3 references that I offer up, and yea, Costco is always one of them. The other is door knocking on smaller buildings.

    Good knocking.............
    shawn_ and smaduri like this.
  6. MSsnowplowing

    MSsnowplowing Senior Member
    Messages: 761

    Been doing this for going on 11 years and not once ever paid for advertising over than my website -(which has landed me a few commercial properties and paid for itself for the next 10 years.)
    I drive around and look at properties and knock on the door and I get word of mouth which is the best.
    I start start knocking on doors in the middle of August if I need to.
    I have a pretty solid client base so I don't do it as much anymore but in the beginning was putting in 50-60 bids a season and would pick up 2 or 3 and so on every year until I had a solid client base.
    So get out there and start knocking on doors.
    Also google maps is great to get a birds eye view of properties in the area's you want to bid on.
    shawn_ likes this.
  7. DeereGuy

    DeereGuy Senior Member
    Messages: 346

    Well, I've been at this for 14 yrs and today, and at this point, I don't know, what I know about my ability to compete . I have catered to the small private light commercial market; small lots and condos for the past 10 yrs. My 5 series deere with the metalpless blade and snowblower means I can deal with just about any difficult lot, spring field-turf etc over my pickup with the XV blade. I store my own bulk salt etc.

    It seems to me that the floor has dropped out of the market in my area. Guys are bidding 50 cents on the dollar to what I have been paid just 2 yrs ago and I'm losing my customer base on price alone. No complaints, no lawsuits; just the opposite. But after having some accounts for a decade, I started losing them last season and this season things have really gotten depressing. The other thought is that Landscapers, which i am not, are tying up a larger portion of accounts with year round contracts whereby summer money pays for winter work at a break even point. I can't pay any bills working at a break even point. All the while more small chain locations are going with national mgmt companies. I won't work for them... I initially tried to work with them as they bought up a couple of, long term accounts clients a few yrs ago but they were just interested in information. After seeing how the lots were serviced and talking to the very unhappy store managers over a couple of seasons I learned how the national scams worked. I still get calls from some of them, but just mess with them now after being sent on more than one wild goose chase for an emergency plow service.

    I don't think my overhead is too high as everyone seems to have brand new equipment around here. This area is quite expensive to live. I have one expensive machine I am paying on. I am too small to bid on the walmarts etc. I don't own a tri-axle. I have had opportunity to bid on new work this last month but I can't even get a call back after sending out my proposals. I won't work for free... I do know my numbers.

    Just received an email today from a long term customer(over 10 yrs) that they are looking at other proposals as My seasonal price increase of $300. this season raised red flags with the management in comparison to the other 100 New England stores. Now $300. is more than a typical 3% increase on this small lot for the plowing portion but the buying power of $300 bucks is negligible. I mean really. I may be done after this season if I can't figure it out. It's not that I won't negotiate a lower seasonal price to retain them. The person/ lawyer making the call can't even come to grips with the fact that I have always spread straight salt. I guess her other accounts spread sand. I'm not going there. If I can't make a wage on this long term happy client then I have to make some serious adjustments to stay in the biz. However, I will not set myself up for litigation

    Before last season, getting a new account took minimal effort. Knock on a few doors and success. Keep that account until a snow mgmt broker took over the chain and move on to a new customer... Now they all seem to want to plow by the inch. I haven't done a per inch contract in at least 8 seasons. I am sending proposals out now with seasonal, per push and per inch increment pricing based on request. Go figure...
  8. Philbilly2

    Philbilly2 PlowSite Veteran
    Messages: 3,797

    Just a question for you here, why do you need a tri-axle to do a wal mart?

    Is that a walmart requirement now or do you think that need that for some reason? I did walmarts for years without any large equipment...
  9. DeereGuy

    DeereGuy Senior Member
    Messages: 346

    Well, I found that most large lots around here needed trucking offsite snow capabilities.

    As an asside, Tried to nice a acct 2 seasons ago which would have payed well. I couldn't line up a truck to haul snow all winter. Half acre of parking times 100" that winter. No one would commit.

    Maybe not Walmart per se. My point simply I don't own or lease lge enough equip at present to bid on the large properties. But ya, I was generalizing a bit. I could bid and sub out every thing and never leave my home office I guess. I'm not comfortable doing that. I'm frustrated w my comfortable niche which I worked on for years. It no longer exists. All the work and back to square one. I'll quit whining now.
  10. ktfbgb

    ktfbgb 2000 Club Member
    Messages: 2,565

    I feel you. We had a drop off in price the last two years as well. I've been talking to some of my buddies here that are running larger operations than I am, like 30 plow trucks each, multiple skid steers, wheel loaders etc. we have seen a 45% drop in rates over the last two seasons. They say that it cycles albeit not usually this dramatically whenever there is an influx of new guys undercutting everyone else just to get work. They only last a season or two and then you can start driving prices back up again over a couple years. Just hang in there hopefully it's just a down cycle then it will come back up. On another note couldn't you get your own dump trailer to haul the snow? Obviously it takes more trips than a tri axle to get the job done but you can get it done. I sub out a guy with a 14 ton dump trailer he pulls with his F350 when we have to haul off site.
  11. DeereGuy

    DeereGuy Senior Member
    Messages: 346

    I did the math on the hauling related a couple seasons ago and it was a hell of a lot of a hauling. More than a dump trailer or two per storm. I couldn't make the numbers work so there was not any reason to take the job. As far as waiting, I hear ya. But $60-75K in overhead every season needs to be paid off. I've paid my dues so to speak.

    I spec'ed out a unit to succeed at a specified job when I purchased my tractor. Small difficult lots and Field-turf related clearing for early spring tournaments. After 2 good seasons, they said they were all done and they bought a machine for the field-turf with about 25% the capability of what I provided for less than their annual cost on the small machine that can't cope w/ bad winter's. It didn't matter. They have the $ and the power. Ya during a tough season I may get a call but I will probably be out of business by then.

    The picture in my Avatar is me clearing off 100" of snow and iced melt from a regulation field-turf Soccer field. I had to windrow the snow under my machine w my Metal pless in a manner to fill my Normand Inv 92 blower, in order to clear the precip off the playing field because they would never call me until they had to have it done. I couldn't drive over it. There was 8 ft of snow in places. I could out-work 1 serious payloader who had to travel to dump the bucket loads and 3 skid steers(some with snow blowers) easily; It didn't matter... They had 4 fields and they have another 4 coming soon ,But , they will not pay an independent contractor to do the work as it turns out, If he seems like he's turning a profit. So I made a judgement call and it turns out that the prime use and return has come to an end and therefore the overhead of the spec'd out tractor unit is more than is applicable or competitive to just plowing small lots. My prices are higher than a guy with a p/u albeit with more capability.

    The folks(contractors I guess) around here are pricing lots at 2002 prices for commercial small lots since last season. I've talked to other's that have lost their lots over the last 2 seasons. Cant get my head around it, and yes, I'm venting now....:hammerhead: Guess I'm going back to building contracting which has had an upswing during the last year.
  12. ktfbgb

    ktfbgb 2000 Club Member
    Messages: 2,565

    Man it sounds like you guys are having a rougher go of it then we are out here for sure. I'm a remodeling contractor so I get to spread my overhead over the whole year. Yes I run regular equipment, nothing specialized like you have. Stories like yours are a reason that I personally would never buy a specialty piece of equipment to service just an account or two. Don't get me wrong I'm not saying that you shouldn't have, I'm just too chicken to do it out of fear of what's happening to you now. I would only do a snow lease for the equipment after I had a signed contract. I wish you luck and hope that you figure a way to pull it off without loosing your a$@.
  13. Philbilly2

    Philbilly2 PlowSite Veteran
    Messages: 3,797

    I'm sorry here DeereGuy, but I have to put my two cents in here...

    Without completely offending you, I am going to attempt to put this gingerly as possible.

    The only way that people make it is to adapt and diversify...

    If I kept every tool or piece of machinery that was purpose bought and waited until that one job came around that for it... I would be sitting there much as yourself, trying to get what I was getting for my niche market piece of equipment on every job... doesn't happen. It sends you further and further into the red...

    You were LUCKY to be presented with the opportunity to do that work and make a good dollar doing it,

    But now it appears that your gravy train with biscuit wheels has derailed...

    So, if that piece of equipment is what is creating all of that overhead and you can't find the work to cover the overhead... dump it.

    I listened to to many guys threw the years with the "I'm not even going to get out of bed for that money..." Sometimes you have to stop, re group, and re structure or else you are going be out of business. It is not always the fact that the guys that you are competing with are doing it for nothing, maybe they have just figured out a better way to do it that does not require the amount of overhead and equipment that you are trying to bid with. I get the knowing your bottom line... if you cannot make profit, there is not any point in even doing it... it just does not seem like that is your particular case. IMO.

    It just appears to me from your posts that you have your tractor that you are trying to find work for it, you can't find the work that is needed to keep it busy, so you are raising your prices on the jobs that you do have for it, and then loosing those... thus making the next job that you bid's price even higher to try to cover the overhead.

    I could be totally wrong here, but that is what it seems like to me.
    ktfbgb likes this.
  14. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 9,883

    that,s why they say, "I'm not even going to get out of bed for that money.

    and some times , well all of the time you will go out of business quicker chasing the lowballers.

    stick yo your pricing, end this race to the bottom.
  15. Philbilly2

    Philbilly2 PlowSite Veteran
    Messages: 3,797

    So let me get this right Sno...

    Let's say you have a $200,000 piece of equipment that you are paying on that you had a niche market for... doing whatever it was...

    You loose that market... so you hold onto that $200,000 piece, try to find work that you could do with a $30,000 piece of equipment (keeping the high overhead on something you cannot find work to charge for) and every year you go further and further in to the red...

    Or you dump the $200,000, buy a $30,000 piece (thus lowering your overhead)and now you are back in the black every year.
  16. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 9,883

    Just because the machine is no longer being used on a sports field doesn't mean he can't or should be utilizing it on resi-drives/ city sidewalks or the like.

    i bet his tractor can be adapted to a lot of things

    It seems a few are making more $$$ blowing drives than plowing them.

    Some folks get jeeps to take advantage of small tight drives, a niche market. does this mean they cant plow anything else.

    expand, expand your thoughts. this will open up a market.
  17. Defcon 5

    Defcon 5 2000 Club Member
    Messages: 2,923

    The problem with the industry is...To many guys will get out of bed for that money...
    SnoFarmer likes this.
  18. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 9,883

    I see your still having moments of lucidity.
    thar may be hope for you yet.
  19. Defcon 5

    Defcon 5 2000 Club Member
    Messages: 2,923

    There's no hope....Just trying to conform
  20. DeereGuy

    DeereGuy Senior Member
    Messages: 346

    Hey, no offense taken here by any response. I'm a big boy. I took the risk to set up an expensive machine to solve a problem. It worked for a few yrs. I was hoping to get some inspiration or jogged into reality with my post. I know how the forum works and its good to get some opinions based on other experiences. Sometimes nearsightedness is the issue. I sent out my proposals 2 months ago. I got some verbals back and one recanted recently. Giving the job to another contractor from Mass that had worked for the owner for 17 yrs. I'd only done his lot for 7 or 8 yrs. I'm guessing this other guy is also up against it and not finding work if he's willing to travel up to this lot. Another said I had increased my prices yet again this year. Well, ya. I know they have at their business, but I can't... And only one equipment retainer has come in to seal one contract. Errr.

    The good; it's not too late. There is still work out there to secure. I may not find it but I believe it's there somewhere.

    I realize I can do resi drives etc. But with one machine that only goes 24 mph top speed it would be tough around here given the yankee do it yourself attitudes. I do struggle to be everywhere at 7am with two machines(truck and tractor w operator). Everyone in this market has the same issue. I used to select work based on when they open to be as efficient as possible. That luxury is not in the realm of reality at this point.

    I have Mac-mansion neighborhoods very close by where the home property taxes are $20k- $25K per year. Yikes... most of them own and use snowblowers for their own 4 garage drives. he.. It's hard to figure. And they scour when you want $35. per 6". I used to play that game. I don't want to go back there. Anyone can see, I'm talking myself out of this occupation. I need a shrink.;)

    I have an ocean on one side so that cuts my potential home base area in half. Still plenty of work. I've convinced myself that the market pricing has changed. Yes maybe some are more efficient. I think the larger landscapers are just employing their summer help to keep them on and eating the equipment costs and potential risks.

    There is no farming here to speak of so the tractor has no real application other than snow. Hay, which is all sewn up is one. Towns used to put out to bid street side mowing. Towns have their own machines these days given the high tax rates here. I spent way to many hours bidding on the State Beach Raking last spring as I had info not available to everyone. Pulling a beach pto power-rake with a hopper across the sand 10 hrs a night up and down the state beach here. Bid on 3000 hrs of work over 2 seasons. Had to get bonded etc. missed it by $10k. The low bidder being from Maine, 100 miles north with a less capable minimalist machine but still barely within spec. His bid was $14k under the 2 yr contract amount that had just passed where the state was not real happy with the job. The guy who had the past contract was the highest of 4 bidders as he had not made any dough given the breakdowns etc last 2 yrs according to him. Salt, sand and seawater are not good for any machine. 3000 hrs in those conditions is a good way to devalue any equipment to nothing. All this to say, I'm open to any work that will pay the machine overhead etc but I usually go into things with eyes wide open.

    Well, back to it...