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I feel like I need to hold my breath

Discussion in 'Business Fundamentals' started by glenspot, Oct 13, 2004.

  1. glenspot

    glenspot Senior Member
    Messages: 255

    I know at least once a day people ask for help with a bid.... But, I hope some of the professionals here that I respect so much will help me out. :)

    I am submitting a bid for 2 group homes. They insist on getting a "per season" price. And since I'm just starting out, i WANT this job. But I also want a fair price for it. I'm willing to give them a seasonal price.

    Here are some stats:

    I think it will take about a half hour at each home. (Lets say that my time is worth $65 for the half hour...so, $130 for the two....EACH time I plow. )

    They want a 3" trigger. And they want it plowed EVERY 3 inches. These group homes are staffed 24-hours a day....and access can't be impeded by snow. Ambulances, fire trucks, their own vans need to CONSTANTLY have access. Also. If it snows 5" of snow...they need to be plowed. But the city plow may not come until an hour later...so they need to be plowed again. (A lot of hassle)

    Our area gets anywhere between 200 - 300 inches of snow per year. (That means that I may need to go out plowing as many as 100+ times over the season, but perhaps as few times as 60 or so.

    Additionally, because of the amount of snow we get. A loader will be needed at least once to push back the banks. (I will have to hire one..and lets assume that will cost me at least $500 per visit, per home....)

    OK....here are the HIGH numbers I came up with:

    $13,000 JUST for plowing

    Then another $2,000 for the loader.

    SO....I'm talking a $15,000 bid for the year. It's a 3-year bid. So, totally...the bid will be $45,000.

    That number scares me. Don't get me wrong. i LOVE that number. But, it scares me (LOL). I don't want to be the LOWBALLER. However, I also want this job.

    I'd love your thoughts on my scenario. On my pricing, etc. I'm open for real discussion.

    Last edited: Oct 13, 2004
  2. snoluvr

    snoluvr Senior Member
    from RI
    Messages: 266

    I plow a chain of group homes. They have about 14 locations I service. I charge them a per "push" price. Everytime I go through they are charged for plowing and salting/sanding. They know it costs more, but they cannot have the liability of snow building up.We use about a 2 inch trigger.I have 1 truck dedicated that makes a route.In a big storm, we just keep hitting them every time.May cost them but they know the lots are safer/Sounds to me like these people had that service, liked the job but didnt want to pay. I would be careful.One false calculation and you are in the hole..Then again it may not snow at all!!!
  3. glenspot

    glenspot Senior Member
    Messages: 255

    The previous contract is up

    The reason they are looking for bids is because the previous contract is up, and legally they need to advertise for bids.

    The previous plower also did it on a seasonal basis.
  4. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    Glen, you've basically answered your own question. "That number scares me" seems to me to be the main problem in bidding. I hear it from both sides (contractor and consumer) - "that's pretty high" Believe it or not, I've had other guys who plow (two come to mind right off) who've told me they can't believe how much I get. But the thing is - I get it. One thing - if you're offering a three-year contract (which is the right way to go for a seasonal), consider a built-in adjusment for each year. Whether it's a stated dollar amount, percentage or tied to inflation, have something that allows increases yearly. Imagine if this winter was the third year of a three-year contract you wrote up in 2001. You'd be pretty upset with the price of gas, price of equipment etc. Also, make sure there's a built in escape for "removal" services. You might not want to include that in your bid, but put it in, something like "equipment and services necessary for snow removal will constitute additional charges to the customer". This will also have the effect of making your bid number lower.