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Gettin' stiffed - Bad debts.

Discussion in 'Commercial Snow Removal' started by Jason Pallas, Feb 16, 2002.

  1. Jason Pallas

    Jason Pallas Senior Member
    Messages: 662

    I'm just curious - how much do we get stiffed by customers on snow removal ? Just looking for some feedback.
    We're in the landscaping biz too were we get stiffed a lot. Bill collection is as much a part of the job as doing to job itself. There's lots of slow pays and no pays - as a matter of fact, we've still got about 40 open accounts from last year that I'm chasing down now (about 10k!).
    However, we rarely get stiffed by snow customers. Most of our contracts are per push with a non-refundable $100 deposit at the begining of the season to hold their space on the list (applicable to the first $100 in billing of course). That helps keep the deadbeats away. Our commercials are billed out after the work has been completed. In ten years of plowing, I've been stiffed by too few residentials to even mention. We've been stiffed by a few commercials that either went out of business or claimed that they never asked to be plowed (pizza joint that was a returning customer that claimed he never authorized service and refused to pay).
    My point is - at least with us, it seems that the snow customers are much better at paying bills. We send invoices out on the first and get most of them back by the 15th. Just curious about others perceptions on this (hell it's not snowing - what else are we gonna talk about).
  2. cat320

    cat320 2000 Club Member
    Messages: 2,224

    I just had someone stiff me for 500but i will not stand for that
  3. Chuck Smith

    Chuck Smith 2000 Club Member
    from NJ
    Messages: 2,317

    Funny Jason, for me it is the opposite. I never got beat for plowing. I had a couple of residential slow pays, but that's it. Landscaping, I got beat on a few monthly maint accounts, but never on a big job. With snowplowing it was either by contract only, or cash in hand when done plowing.

  4. Jason Pallas

    Jason Pallas Senior Member
    Messages: 662

    Chuck - I should clairify - the 10k/40 accounts that are still out in landscaping are all for maintenance contracts. The few snow accounts that we've been stiffed on are rare. One was a woodworking shop that closed up and left ovenight (they were good customers for about 3 years too). Our collection agency found the owner after about 2 years and after they (our collection agency) took their cut, we got $300 of the $500 they owed.
    The other was a neighborhood pizza joint that we used to order from. He got a whole month of service - then when we billed him, he claimed he never authorized service. This guy is an idiot - since then, we never order from him, my employees never order from him and all the crews are forbidden from eating there while at work (they don't after work either). He owed us $500 - I'll bet he lost that in two months from us not ordering from him. Talk about cutting your nose off to spite your face!!!
    Anyway, I think snow customers (at least ours) are a lot better breed (than landscaping customers). They tend to appreciate the service more and because the demand is so high here, we can really pick and choose so we get only the cream of the crop (payers). Just curious if this is what others experience too.
  5. John DiMartino

    John DiMartino PlowSite.com Veteran
    Messages: 2,154

    I gotta be lucky,ive never got beat for plowing either,I guess Ive beem lucky.If i do get beat out of it,I will tell any other contractors about them,so they dont get the same thing doen to them.
  6. landscaper3

    landscaper3 Senior Member
    Messages: 309

    We only maintain properties that sign a contract! If they are late on a payment we call and then a late fee is attached to monthly bill. We only had 1 cronic late payer, he paid late 3 times late then decided not to pay so we called him night of the storm and asked if he had the money owned with late charges he said no! We dropped em. He was upset do to a snow storm coming but I bet if it was a nice day out things would be different. Only one we dropped, others are late but they are reminded about the late fees and are on time after a few occurances.
  7. Pelican

    Pelican 2000 Club Member
    Messages: 2,075

    I've got a few accounts who are chronically late, but I can't remember ever being beat. I've taken several to court who have made an attempt, most pay in full when they get their subpoena. In one case the customer failed to appear, I was awarded a judgement and the customer failed to honor it. I took it to the Sheriff and the customer's bill went from $250 to $450 with the filing fees attatched, then the Sheriff siezed the funds from their checking account.

    I've got one account that I'm waiting for the 60 days to pass so I can start the procedure again.
  8. Jason Pallas

    Jason Pallas Senior Member
    Messages: 662

    Having to chase your money really bites. You feel like ringing their necks and saying - how'd you like it if your boss jerked you around on your paycheck for 2 months!
  9. landman

    landman Senior Member
    from NJ
    Messages: 185


    Heres an Idea, Bring all of your employees and thier families, your friends, relatives, and heck even your kids sports team. Go to his place with all of them order dinner eat and then when its time to pay walk out and say you never ordered all that food. Then you'll be even.

    JD PLOWER PlowSite.com Veteran
    Messages: 751

    I've been stiffed on several occasions , but as pelican said you go to court and most pay up at least a partial payment. Denial of service is fine, IF YOU HAVE A SERVICE TO DENY! This year I only have one chronic non payer, which is why I 'm hoping for at least 4" tonight so I can deny their service :D .

    Had one account in '93 stiff us for $4,500. Filed my claim and found out the guy filed chapter 11 two weeks before and took most of the contractors who renovated his building with him :eek:. By the time the banks and creditors got thru with him we got $500. Percentage wise we did better than most.
  11. RB

    RB Senior Member
    Messages: 197

    That is why I concentrate on seniors. I bet most late paying customers you are talking aboaut are the yuppie type or younger people who are overextended.

    My seniors usually have my checks at my house by the 10th of every month.

    This year I'm implementing contracts for all my late paying customers.


    Does anyone have contracts w/late "service" fees and customers are still late? I'm going to charge a $25 Service Fee for payments received afte the 5th of each month. I'm going to hand deliver invoices "for monthly maintenance service" around the 21st of each month (probably when I'm there sometime during the 3rd week each month.) The contracts state payment is due on the 1st of each month and a service fee will be charged after the 5th of each month. The contract also states that monthly service cannot begin until payment is received. (I bet that will get me in trouble this year. I can already hear a customer complaining because I skipped him during apr or may because his check was not in by the 1st) -- oh well.
  12. John DiMartino

    John DiMartino PlowSite.com Veteran
    Messages: 2,154

    Senoirs are the first to pay me too,commercials are last,but i know that going in,and so far it has been worth the wait.
  13. Sno

    Sno Senior Member
    Messages: 320

    Yep, I have a convenience store sized lot. It only snowed once here all year. I sent my invoices out net 10 days. I think the owner figures the snow season is over and she is going to stiff me. Im not sure yet what Im going to do about it. I sent a reminder and heard nothing.

    I had a feeling I was going to get stiffed when I called and left several messages offering to salt durring the ice storm, which I went ahead and salted for free by the way since I was out anyway and she never got back with me. I also called offering other services and never got a reply. Now its three weeks past pay day and still have not heard a word... This one has me ticked. No reply at all and only an answering machine. If she needed more time I could handle that but just ignoring me has me ticked big time.

    I stopped in twice but she was with customers and she ignored me for 40 minutes total while I stood by the door, I didnt want to make a scene for her customers so I left.

    I really think, if we get anymore snow It would be worth it to just park outside her door and watch her and her customers wade through the snow till she finds someone else. I know Im doing it cheaper than anyone else in the area would. Actually about half price. I got stuck with her when I bought out another account so I left the cost the same as the other business was charging.

    I'm with you Jason...

    One plowing all year and they are going to stiff me..... Now thats gratitude!

    Oh... I had to edit this and add cost so you could really see my anger.

    This is a convenience store sized lot, she never got back with me on the salting .25" of ice on the lot and I scrapped the 1/4" of ice off the sidewalks so her customers would be safe in the morning. Not getting an OK from her before or after the salting (No reply at all) I put N/C on the invoice to make sure she was happy! Did all this for 40.00. She stiffed me 40.00 for all that and one plowing. I didnt even charge for the salt. :mad:

    Last edited: Feb 22, 2002
  14. Rob

    Rob PlowSite.com Veteran
    Messages: 306

    Man you are way too nice a guy. You got ripped off twice. Once by her and once by yourself. Can't say I blame you though, you tried to be a responsible guy and help her out. Too bad really, in this case it seems like the nice guy finished last.

    -- You didn't have a contract ?
  15. I haven't been bitten yet. I did have a motel contract that paid well. One day a guy stops by while I was plowing to try to collect what they owed him for plowing. He walked out as I was going in to get paid and he told me how they stiffed him for several hundred dollars (without cause). Boy were they ticked off when I told them I wouldn't be back. They couldn't understand the ethics of my decision,,, all the more reason not to plow for them.
  16. Sno

    Sno Senior Member
    Messages: 320


    No, I didnt have a contract, just the one from the other plower I bought out.

    Thats one of the reason I was trying to get ahold of her before the snow. and also why I was bending backward for her.

    Im sure she has no one else cause It was a sunday and all the local plowers had plowed already while it was still snowing. I waited till later, after the snow stopped that evening since she was not open for business till morning.

    At any rate, she cant take 2 minutes out of her day in the last 3 months to inform me of the problem? I take that as being stiffed!


    Good thought,
    I may inform her new plower that she needs, of my situation.

    I bet it would be a long shot to find one as principled as you though. especialy with 1.5" and one ice storm all year.

    Thanks guys.

  17. Rob

    Rob PlowSite.com Veteran
    Messages: 306

    Sorry to hear that. I hope you get your cash. You certainly went well above and beyond for this woman. (And you didn't even cause a scene in front of her customers. That could have cost her $40 !!)
    I hope you get your money.
  18. Sno

    Sno Senior Member
    Messages: 320

    I may have her? We are to get some snow Mon, Tue And Wed.

    I think I'll stop in after the snow falls and ask if she wants it plowed, cash only! Assuming it doesnt go around us again.

    Then get the contract signed at a new decent price.... if she still wants.

    She blew it, I was going to stay at the past price to make sure I kept all the accounts.

    Thats a 60.00 to 80.00 lot for the competition.

    On second thought, I dont even think I want to mess with her anymore. I may just move on and see if and who she calls.

    Maybe it's time she found out what the lot is realy worth.

    Last laugh..... ;)

    Last edited: Feb 23, 2002
  19. plowjockey

    plowjockey PlowSite.com Sponsor
    Messages: 622

    I would at this point send her another bill with a registered attatchment on the letter. That way she has to sign with the postman when she gets it. Most businesses realize right off that this is the first step in collection. You have to verify that they received the bill.
    Now we both know that she did get it but this gives you oine of the three most important words...documentation.

    Oh yeah all three of the words are document, document, document.

  20. Sno

    Sno Senior Member
    Messages: 320

    You guys will love this one.....

    I was driving by this account that stiffed me, expecting snow, I decided to stop in and I was not waiting by the door being ignored this time.

    I went in and there where customers in there. I walked up to the lady and asked politely... Am I suposed to plow your lot tonight or not? :confused:

    Stuttering, she said which plower are you? Hahhaa, she was going to stiff me no doubt. If she didnt know which plower I was she must have been talking to another one or two.

    I said I'm the one that did it last time, you should have recieved my bill and payment reminder.

    She said, your at 40.00 to plow this lot right? I said yep. She said,,,,, Oh, I guess I'll have you do it then... (Point two she was pricing a new plower.)

    Then she walked me outside away from the customers and mentioned she doesnt want it plowed any more if its going to melt in the next couple days.... Unless we get 4" or its going to stay cold for several days. She said she didnt make much money at her business.. I understand that!

    Now, this is a business that has only elderly customers. It is right in town in a section of several convenient store sized lots that are always plowed and kept clean. hers sticks out like a sore thumb if not plowed.

    My worries... 1) Someone will slip and fall. 2) people driving by see me doing a half butt job. 3) I may not even get paid. 4) I may make the wrong call.... to her satifaction.:(

    She said she would get the money right out. :rolleyes:

    Now, what would you guys do with this one?

    I plowed this morning all my other lots and drives and cleared just her parking lot spaces and one path where she parks. I figure she might stiff me but I can sleep knowing I helped a little old lady get into her store a little safer.

    It amounted to about 1/3 of the lot and I plan on charging 1/2 price (20.00) We recieved 3" of wet snow and its 30 degrees out.

    We are supposed to get 2-4 more inches today and 2-4 tomorrow... Who knows when it will melt.

    Jeeese, now I have to be a weather guesser too!:eek:

    I feel like Im walking on eggshells with this one and have not recieved a dime. She is into me for 60.00 now and more snow comming.

    Aint it Great!