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Discouraging snow removal entrepreneurship

Discussion in 'Commercial Snow Removal' started by Tubby's Snow Plowing, Jan 22, 2011.

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  1. Tubby's Snow Plowing

    Tubby's Snow Plowing Senior Member
    Messages: 199

    I love these guys. Ran into one the other day. Fed some guy the same lines as always:

    • Too much competition in the area.
    • Wears your truck. Replacing parts left and right.
    • Uses so much gas.
    • Insurance is so expensive you'll need a second mortgage.
    • Busting your butt for $100 a month.


    Competition is good. Keeps prices fair and integrity high. Forces companies not to get complacent and actually work the community for business.

    Of course it wears your truck. More weight on the front end bouncing around will wear your front suspension components faster. That is why you charge what you charge. It's called overhead. If you have to replace your suspension every 2 years or so from wear, make sure you factor that for your cost of doing business.

    Engines use fuel. Big deal. You should only complain if you don't factor your cost. I will run as much fuel as the engine can burn as long as someone is paying for it. That is factored in my price for my service. The clients are paying for my overhead. Big deal. Business 101.

    Insurance is not expensive compared to other professions. You're looking at a few thousand dollars in general liability and vehicle insurance per truck for a year. If it's only a plow truck driven in the winter, then it's only 6 months of premiums and suspend coverage in summer time. I do this every year and it lowers my insurance cost down to, you guessed it, half.

    Plowing isn't hard work in that it's physical labor like lifting, hammering, moving stuff around. You sit in a warm truck listening to music and push snow around. That's pretty easy. The hard part is maintenance of the business, vehicles, playing multiples roles of the business (book keeping, laborer, secretary, customer service rep, etc). The expensive part is maintenance of the equipment, ie the truck and plow. Don't ever forget your own maintenance, ie your health. It can take a toll on you if you don't take care of yourself.

    $100 a month? If you're making profit that satisfies you, give 'em hell at that price. With any business in any industry, you factor your overhead, charge a markup, and walk away with your net profit after your overhead is paid. You charge as much as what you can get clients to pay and the clients will pay as little as what they can get the quality of service for their money. Prosperity is in the middle somewhere. Most of the guys here that charge $100/mo are guys that plow for themselves and a few people to pay off the plow. No formal insured business would charge that low in my area. Professionals don't work for peanuts.
  2. rcr4w

    rcr4w Member
    Messages: 39

    I agree these guys crack me up I bought a polaris ranger to take the kids trail riding in decided to buy a plow and spreader to do our drive way 2 weeks ago since then we've had a decent snow for our area and I've made 12k to date and another snow coming sunday another 1500 and I paid for it all and before you start busting my onions about insurance I am an underground contractor for 3 phone companies I have to carry more frikin insurance than a dozen companies should ever need but we have always shyed away from snow removal because well to be honest I don't really like to work during the day let alone at night in the freezing cold but we will be gearing up for some snow removal for next year I never realized how much money could be made
  3. snowplowchick

    snowplowchick Senior Member
    Messages: 549

    In Canada, you cannot suspend your commercial liability insurance for half the year.

    I agree though that many people price just to get the job, without taking into account their costs. With the economy the way it is, businesses are coming to the table with sharper pencils. It never fails that the employees we deal with at each municipality/business act like it is their own money paying for the service, they nickel and dime and complain at times.

    Mandatory insurance coverage is a given with the businesses we service. Some large landscape/snow companies that have come into our area recently are winning bids and I don't know how they make everything go round with how low they are pricing.
  4. rcr4w

    rcr4w Member
    Messages: 39

    I have to imagine this is very similar to underground utility work in that these large companies hope to make up for the low bids in volume of business which thankfully has led to the fall of 2 of the contractors I hate and am very glad to see them out of business as they deserved it by being idiots for far too long
    I am curious how or why with a seasonal business why you can't start and stop your insurance as needed thats like a race track paying for insurance year round instead of by the race
  5. Shoreline

    Shoreline Member
    Messages: 59

    Snowplowchick, according to my insurance agent, I can suspend the snow portion of my insurance during the off season thereby reducing my costs. I pay monthly instead of annually so I can do that. Talk to your agent and see if you can save yourself a few dollars.
  6. JD Dave

    JD Dave PlowSite Fanatic
    Messages: 11,194

    Well you might save a $1 by doing it that way because when you go to resign they will get you. It's like motorcycle insurance the 6 month price is the same as 12 months.
  7. basher

    basher PlowSite Fanatic
    from 19707
    Messages: 8,993

    Or a loan you only pay on nine months a year. the yearly totals are close to the same, only with the nine month programs you pay more money because of the additional interest.
  8. sweetk30

    sweetk30 PlowSite.com Addict
    Messages: 1,588

    guy at the bar last night overheard me talkin about plow insurance . and the fact lots of you pro's carry 1-5 mill coverage to start.

    you should have seen him whip his head around and get the bug eye look. :eek::laughing:
  9. Neige

    Neige Sponsor
    Messages: 2,215

    Well said. Thumbs Up:drinkup:
  10. Camden

    Camden PlowSite Fanatic
    Messages: 6,604

    The one that always kills me and I hear it all the time is that cutting edges are too expensive. For me there's a direct correlation between the time I need to replace my cutting edge and the amount of money in my bank account. I wish I had to replace them more often to be honest :p
  11. KEC Maintaince

    KEC Maintaince Senior Member
    from N.J.
    Messages: 265

    i joined this site a few months ago took a beatin from some guys about how i charge and etc.
    i have read and listened to experienced guys and have since raised what i charge .
    i only do blowing services residential i dont plan on going into commercial. but next year i will be getting truck and plow and i will be carrying ins.
    made a lot of mistakes this year learned from some got screwed by some i want to keep it small to learn .
    made some decent coin paid off blowers and stocked up on salt and better clothing .
    i want to thank all you guys for posting your experiences good and bad.
  12. snowplowchick

    snowplowchick Senior Member
    Messages: 549

    Shoreline, I can't quote you For some reason, using my iPad. Do you pay a percentage of your gross? We pay basically based on total annual receipts and risk. I didn't know commercial liability could be done any other way. That's good if you and your agent have found a way.

    IPLOWSNO PlowSite.com Addict
    Messages: 1,620

    good post op
  14. vinnys

    vinnys Senior Member
    Messages: 113

    Hey rcr4w... Am I reading your post right???? You made 12K in two weeks in a Ranger with a plow and sander??? . The best I could do here in N.Y. in a six wheel dump with a plow and sander is $80.00 an hour. I'm going to look at the Rangers tomorrow!
  15. abbe

    abbe Senior Member
    from RI
    Messages: 718

    Haha I highly doubt 12k. I believe its a four wheeler
  16. ECCO

    ECCO Junior Member
    Messages: 3

    I have a 2 mil, 5 mil policy and after this im adding a plow to my rzr for sure I found the honey pot if this post is correct
  17. rcr4w

    rcr4w Member
    Messages: 39

    no bs just everything fell into place I had no intenetion of even using it to push snow other than my own driveway but apperently places like sonic, and banks with large drive thrus and atm lanes like having it all plowed not just where a plow truck can go plus I can do the side walks with it for the most part and never have to get out of the heated cab I didnt do any of them by the hour there were just several business' here in town that were not plowed a day after the snow I started going door to door pretty much the same line at every place the guy they normally used was mia I shot them a price and they gladly took it I have already had calls from every residential and commercial place I did except for 1 wanting me to come back if we get the 4-6" they are calling for between now and sunday night you guys with trucks can rag on the utv guys all you want hell I pull my ranger around with a 4 door 4x4 kodiak 4500 but my 800 ranger has plenty of power to push with is way more manuverable than any truck and hardly uses any fuel compared to trucks my only gripe is I bought one of those spreaders from tractor supply that goes in the reciever on the back and it sucks if I could find a decent spreader that would hold 300-400 pounds and not cost 4k I'd be one happy camper well plower
  18. Tubby's Snow Plowing

    Tubby's Snow Plowing Senior Member
    Messages: 199

    For crying out loud, use proper grammar, proper punctuation, and use English like a professional. Your post contained one single comma (which was misused) and zero, repeat, not a single period in the entire post. I know ten year old children that write better than that.
  19. rcr4w

    rcr4w Member
    Messages: 39

    uh oh watch out its the grammar police don't like what I type then please feel free not to read it
  20. rcr4w, your utv might be fine for what you've used it for so far but if you get say a 12" heavy snow or enough smaller ones that you need to push back or stack large piles you will be SOL with any utv. Not to mention if ya get enough snow on the walks so there are piles on both sides and thus nowhere to push more snow. Not in any way bashing utv/4 wheelers for snow removal as they have a place, but you will quickly run out of options if thats all you have to use, especially in commercial work. Glad your making money just trying to give ya some possible complications to think about.
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