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How much or how to charge for these investment properties

Discussion in 'Bidding & Estimating' started by riverwalkland, Dec 23, 2008.

  1. riverwalkland

    riverwalkland Senior Member
    Messages: 401

    :help: I plow these 3 parking lots for 4 (two share a lot) investment properties belonging to one of my good regular customers. I basically took them on as a favor last year and this year I want to work out some kind of pricing system that makes more sense. The problem I am having is that unlike regular large parking lots where I'd charge some hourly rate/price per season, or a resi driveway that i price per plow, these are always taking different amounts of time to do. There are three lots:

    lot 1: about 16 parking spots
    lot 2: about 5 or 6 parking spots
    lot 3: 5 parking spaces

    They are basically driveways/small parking lots for some student housing. The tricky part is that they are empty some times, full some times, half full, or almost empty but some idiot parked in such a way that makes it take 10 times longer to plow. I know this is one of the joys of plowing, but I am so used to just charging x$ for plowing someones driveway, but I can't figure out how to charge for these. Sometimes the first for example is full and all I can do is put the plow down, plow one pass inbetween all the cars and drive off, a total of about 60 seconds worth of plowing. Some times it takes 5 minutes, sometimes 15 minutes, and sometimes 30. Sometimes the guy meets me and has the cars moved and sits there and shovels every last bit of snow from weird spots into where I can plow it away. I often am sitting there waiting for him to do this or move cars and time is money... Last year I just looked at the lot one day and said 50$ per push (not including any salting). The problem I had was I was just charging him 50 for when I could do most of it or nothing when i couldn't do most of it and writing it off as a favor. I don't like this method it both pays me nothing some times and charges him too much when I really haven't done much.

    The obvious solution to me is a per month fee but he does not want to do this. What am I supposed to do, charge per minute? or charge per hour and have bills for .04 hours and all sorts of weird decimals? Right now my best idea was to say 50 for a full plow, some lesser amount for an 'entrance only plowing' and yet another amount for something in between. I don't think this sounds like a professional fee schedule but what else is there? Thanks for your input, much appreciated. Also before anyone says it dropping the client is not an option, his summer work pays way to well.

    Just to clarify I'm not really looking for how much I should charge for the lots, as you guys can't see them/have different costs etc, just how to charge for differing plowing times on the same lot
    Last edited: Dec 23, 2008
  2. Rc2505

    Rc2505 PlowSite.com Addict
    Messages: 1,245

    I would charge a flat rate per hour with a min. of 15 minutes, billed in 15 minute increments. that way if it takes you 16 minutes you charge for 1/2 of an hour. I can't see where this could go wrong for you.
  3. riverwalkland

    riverwalkland Senior Member
    Messages: 401

    not a bad idea, thanks

    one problem is 200$ an hour I think would scare this guy off... that is I can do the whole 50$ lot in 15 min if its empty.. i feel like he might say 200$ an hour are you crazy, especially considering that's twice the rate of a FEL w/a pusher around here
  4. Burkartsplow

    Burkartsplow PlowSite Veteran
    Messages: 3,246

    I have 4 small apt complexes. sometimes full soemtimes empty. flat rate either way. sometimes two passes takes a minute or two. sometimes 15 minutes. as long as they can get out is what matters. no snow where the cars were parked so once they leave the lot is pretty much clean. good luck. flat rate and every one knows what the price is. good luck.
  5. riverwalkland

    riverwalkland Senior Member
    Messages: 401

    These are a little different I guess because there is tons of snow once the cars leave because everyone brushes it off their cars onto the lot, and also the way some cars park can prevent me from making a turn i need to make to remove a large amount of snow from a certain part of the lot. Thanks for the idea, I just don't like charging someone a full amount when I don't do much of anything.
  6. LoneCowboy

    LoneCowboy PlowSite.com Addict
    Messages: 1,760

    I have a bunch of tiny little properties, all run by the same property management firm and all within a few blocks of each other.
    I mean tiny. One of them has 3 parking spots, the biggest one has maybe 15.
    But they are all real close and I only have to do one bill.

    I bill by the minute (for each property, so he can divide it up among the properties, I get one check).

    That's fair for everyone, and no one can touch my pricing (because they all want to charge a minimum)

    It adds up. If it's a 1" storm, it's pretty quick, if it's 6", it takes longer. no one loses.
  7. riverwalkland

    riverwalkland Senior Member
    Messages: 401

    what do you charge per minute?
  8. LoneCowboy

    LoneCowboy PlowSite.com Addict
    Messages: 1,760

    I charge my usual hourly rate (whatever yours may be in your area)
    I just let it divide by 60.

    so, if I'm there for 3 minutes, they get charged for 3/60th of my hourly rate.

    Don't advertise the per minute, it LOOKS like a lot of money (for example, $120/hour is $2/minute) but people think $120 is fine, but $2/minute is a lot, despite it being the same thing. Marketing is a strange beast.

    Different tractors cost different amounts, along with shovelers.

    It actually works really well, and you can pick up either people nearby, because people can't touch your price, and you do a lot of places, without driving all over. Very efficient.

    Set the trigger very low though (no more than 1 inch), if they want a high trigger, than it's a set price (typically $45/$50 no matter how small), you do after all, have to pay for your equipment.
    But even a tiny lot can be done in 5/10 minutes, it's much cheaper this way. (than a set price)

    Their lot is cleaner, for less money than with a competitor. It can be a no lose proposition for them, but it can take some salesmanship to explain it. Once people understand it, they like it a lot.

    It does take some record keeping on your part. (when I arrive, I write in the time, and as I"m leaving I write in the time, then I just put it all in a excel spreadsheet, and it computes the amount.)
  9. MileHigh

    MileHigh PlowSite.com Addict
    Messages: 1,827

    Charging by the minute????...

    sorry but,

    THATS INSANE.:confused:
  10. jimaug87

    jimaug87 Senior Member
    Messages: 179

    0-30 minutes $30 31-60 minutes $60 (or watever your pricing is)
  11. riverwalkland

    riverwalkland Senior Member
    Messages: 401

    so you would charge 6$ for a parking lot that takes 3 minutes? i can do my 25$ 10x30 ft condo driveways in about 1.5 min and get 25$

    I guess your system makes sense but it just seems like per minute bills are semi unprofessional.

    I do like the incrimental billing some people have mentioned. I think i might just come up with a tier system

    Tier 1 - x$ (say 10)
    Tier 2 - 2x$ (so say 20)
    Tier 3 - 3x$ (30)

    and just write that tier 1 is if i show up and all i can do is the entrace
    tier 2 is normal
    tier 3 is a full lot plow with all cars removed or a normal plow with excessive snowfall

    this idea make any sense?
  12. LoneCowboy

    LoneCowboy PlowSite.com Addict
    Messages: 1,760

    You missed the key point.
    There's a bunch of these tiny properties (i think 10 of them), all within 3 blocks of each other, all managed by the same property manager.

    it's like doing one big property, but it's all spread out.
    And just so you realize how this adds up. Our first (well heck, only, stupid worthless snow, everyone else gets snow but us :cry:) snow was about 3-4". I billed about $800 to these little properties. (plow, tractor, shoveler, ice melt on walks). I have other properties and we plowed everything, and we were out less than 6 hours TOTAL. (these are my only shovel properties and I'm in the plow doing other properties, it's mostly tractor & shovel work)

    I make money, they save money, NO ONE can compete with my prices and the lots are clean and I've picked up 3 other customers from them. In a few years, I'll own this little neighborhood.

    What's the downside?

    I'm not saying it works for everyone or everything, and honestly, most of my properties are per push, but for this instance, and it sounds like the OP, it works. Just because everyone else is doing it one way, doesn't make it right. Try something different, out of the box and see what kind of competitive advantage it gives you.
    Last edited: Dec 24, 2008
  13. MileHigh

    MileHigh PlowSite.com Addict
    Messages: 1,827

    ^^^thats pretty good, but it looks like that 800 has to go out to a few people and equipment.

    that sucks you've only been out once this season...I've only had 4 plowable events, and would be super pissed if I've only plowed once this season...longmont will get hit soon.
    Last edited: Dec 24, 2008
  14. LoneCowboy

    LoneCowboy PlowSite.com Addict
    Messages: 1,760

    2 people, 1 shoveler, 1 tractor driver (who happens to be the wife) and she does do some other properties (the shoveler doesn't, but shovelers are cheap)

    for 6 hours, for tiny tiny tiny properties?

    pretty good.

    Yeah, 1 event, last night was another bust, not even a dusting.
    where is the snow?
    if it doesn't snow, everything I take care of in the summer isn't going to grow either and we'll be bust.
  15. MileHigh

    MileHigh PlowSite.com Addict
    Messages: 1,827

    Now that's sweet...I wish my wife could run some equipment like that, that's is just plain hott.

    There is a freaking magical line that goes down the foothills that blocks all the snow from hitting the front range it seems. The mountains are getting pounded a lot. We just haven't been getting any upslope winds.
  16. kthhayes

    kthhayes Junior Member
    Messages: 17

    Charging by the minute or hour is fine when you are working for one property manager with several close stops, but you should also be charging for the time between posts, I have learned that many contractors in our area charge post to post so they charge to show up, and the time to the next job, that way they are getting paid two times their rate while on the road between jobs, $120 per hour or more. I only charge one post and the time it takes to do the work, that way if we have major trouble on the roads I dont rush. I bill on the closest 15 minute interval, so if it is 10:07 i bill it to 10:00 and 10:08 is 10:15. Besides a couple of regular customers I do not deal with residential, too many varriables, but if somone does call it is a minum of $85 this year, ir T&M if it takes longer, ppl love to drive on the stuff for a few days then call you for ice removal.lol I would suggest that you bill from the time you arive, till the the end of the third job, bill on the quarter hour, and let them divy up the minutes, easy work, easy bill, easy money... And you are still getting paid a fair rate. P.S. Have the manager place a sign in the area that presents a problem to your turn that there is to be no parking there, or at least when there is snow, and if somone parks there, bill them to come back later and finish the job, if that is what it takes then that IS what it takes. Have fun playing in the powder!!!
  17. Plowin in VT

    Plowin in VT Senior Member
    Messages: 233

    You still need to take the time to go to these properties to plow, and it isn't your fault that there are cars there. I would do a per push charge, sometimes you'll win, sometimes the owner will win. Either way, you spent your time going to these places. If you charge by the hour, how can you prove it if asked?