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JD Dave;1977421 said:
I've plowed all inclusive, salting, plowing and about 75% of my work even includes loader work for 24 years. I've never lost money. It all seems to work out every year. Yes some years can be lean but I know every year I have a set amount of income coming in and the low snow years seem to make up for the big ones. If your a solo operator spreading very little salt it would be pretty much impossible to loose money as your only real expense is fuel and a little more wear and tear. When you get bigger that's when things gets tricky. On edit only the contractor wins with a cap.
don't you dare try and bring "basic logical reasoning" into this discussion
 
snowplower1;1977419 said:
flawless, thats a crazy good insurance if your doing tree too. whos your provider? my dad got outta the tree biz when insurance for it just got too much. ours is a little higher than yours but no tree but our prices here are higher for some reason
State Farm.. Great to deal with as well.. They send us nice Christmas presents every year as well..
Cost of living is way low here in C-Bus, i know that plays a huge part in insurance rates..

I would never get out of tree service. 2nd best profit margin behind snow removal.
Two more seasons and i have my big dog chipper paid off. Bucket was paid off last season.
 
ponyboy;1977396 said:
It's just one truck but my agent is a good salesman
I done
3k a month So how many DWI do you have I know guy tried to get Ins And he couldnt afford it. With 2 DWI on his record. They wanted 2k per month So he is riding a bike.
 
Flawless440;1977441 said:
State Farm.. Great to deal with as well.. They send us nice Christmas presents every year as well..
Cost of living is way low here in C-Bus, i know that plays a huge part in insurance rates..

I would never get out of tree service. 2nd best profit margin behind snow removal.
Two more seasons and i have my big dog chipper paid off. Bucket was paid off last season.
yeah it must just be because of the difference in regions. when i own the business i want to try to see if i can profit enough with the tree biz and get back into it. i would love doing it and like you said its a great profit margin. I might have to look into state farms insurance around here. thanks!
 
ponyboy;1977385 said:
Also I pay over $3000 a month just for car insurance have not had a claim in over seven years I don't get money back and I still feel it's fair
I'm not buying half of what you've posted in this thread and it'd be nice if you would actually answer the question of how a cap benefits the customer
 
Insurance just left State Farm to switch to a different company that is cheaper farm family
I have 15 trucks 2 cars and an umbrella policy no Bentley but wife car is an AMG
All driver clean no dwi
No accidents payouts in 7 years
Also have full coverage on 7 enclosed trailer
All have 1 mil coverage and other crap it's just my area insurance is expensive
How does it benefit the customer like I said I'm in business to make money not save the customer money
I'm more of a commerucal guy that's why I only do 13 houses but they make as much money as 40 houses
Am I saying I'm correct no but it works for me all I can say is that business started in 1984 by my dad and I took over 1992 when I bought him out
Back then I would do 65 houses my self for $250 for the season and it was crazy so I slowly raised my prices to where I made good money in less time and less wear on truck and after loosing money one year tranny went lots of snow I set limits on contracts
I explained I can't lose money plowing so limits apply
Again this is a business
If any one wants to see my numbers they can come in down /up/over and see my books
Am I the smartest no
The best no
I do what has been working for me
And I haven't lost money in the winter in a long time
 
ponyboy;1977491 said:
Insurance just left State Farm to switch to a different company that is cheaper farm family
I have 15 trucks 2 cars and an umbrella policy no Bentley but wife car is an AMG
Before you said 3k on one truck per month

Now you say 15 trucks and 2 cars

Which is it
 
Seasonal with a cap, I could understand with a one year deal you might be able to sell it. How it would benefit the customer?? No such thing. Complete win win for the contractor. I often give the speech of seasonal with a cap just as an explanation to get into a multi-year deal. Or I just have my cavemen do it per push.
 
Flawless440;1977441 said:
State Farm.. Great to deal with as well.. They send us nice Christmas presents every year as well..
Cost of living is way low here in C-Bus, i know that plays a huge part in insurance rates..

I would never get out of tree service. 2nd best profit margin behind snow removal.
Two more seasons and i have my big dog chipper paid off. Bucket was paid off last season.
State Farm here too. 200/month 3 vehicles 2 mil general liability.
 
This is how a seasonal with a cap works in my opinion.

Let's say your area plows 20 times a year on average and the lot is worth $10,000.

You agree to plow the lot 15 times for $7,500 and $500 per push after that. (or by the hour, inch or whatever)

So in a light year you're guaranteed $7,500 and the customer saves $2500. If it's per push who knows what you get.

In a normal or heavy year you get paid what you're supposed to get and the customer pays the normal price.

This is a win win for both sides. Okay let the bashing begin.
 
oarwhat;1977556 said:
This is how a seasonal with a cap works in my opinion.

Let's say your area plows 20 times a year on average and the lot is worth $10,000.

You agree to plow the lot 15 times for $7,500 and $500 per push after that. (or by the hour, inch or whatever)

So in a light year you're guaranteed $7,500 and the customer saves $2500. If it's per push who knows what you get.

In a normal or heavy year you get paid what you're supposed to get and the customer pays the normal price.

This is a win win for both sides. Okay let the bashing begin.
What bashing,finally someone with a brain!You're close to my thinking.I really didn't want to answer this.Look at it this way, the basic one price seasonal is priced to take in account a bad year,the proof of this is everyone saying they still make money when it snows more than average.So the price of a seasonal with cap is lower than standard seasonal,why? because he knows if snowfall is over cap he will still get paid for work,client isn't getting "ripped off",he's paying for services rendered.In a low snowfall year the basic seasonal client is getting"ripped off" by contractor who's making more money because he's plowing less.The cap seasonal has lower base price because the cap is his ins. so client pays less that year. And think hard about this,2 accounts bid both ways will actually come out very close in price over a couple year time frame! And one last point,If one price seasonals are fair for all,why would a year with more snow equate with higher seasonal prices? That actually works out against the seasonal argument,unless you're looking to ripoff you're clients! Oarwhat,send me a pm and I'll send out a special prize to you!
 
Here's another way a seasonal with a cap works.

Again a normal year is 20 pushes and lot is worth $10,000.

Seasonal is priced at 20 pushes for $10,000 with a cap at like 30 to 40 pushes.

This one works exactly like a normal seasonal except you get paid for an extreme year.

I prefer my first example. Easier to sell some savings to a customer. And as Leigh says over the years you usually make the same amount
 
peteo1;1977471 said:
I'm not buying half of what you've posted in this thread and it'd be nice if you would actually answer the question of how a cap benefits the customer
Snow removal has always been sold as the deeper the snow the more work involved so the price has to be higher.

Seasonal price customer pays $2,000 a year, three year contract.

1st year non seasonal price would of been $1,000, customer overpaid $1,000.

2nd year NSP $2,000, customer broke even.

3rd year NSP $3,000, customer underpaid $1,000, after three years customer and contractor paid/made $6,000. Fair to all.

Now with a cap the 3rd year the NSP was $3,000, customer would of paid $3,000. Now the cap caused the customer to pay $7,000 for that three year contact. Not fair to the customer.

For the whole purpose for selling a seasonal price is the customer accepts that some years he would pay more for snow removal then the actual price and he would pay less then the actual price other years because for the convenience of one consistent price so he can set a budget to pay for snow.

A fair system for some years the customer would come out ahead, then other years the contractor would come out ahead. In the end things average out so pricing is fair.

Now to place a cap and charge more the contractor is making the math where there will be more years the customer pays more and less years where the customer would pay less. So caps makes the customers average snow removal budget cost more.

The only way to make caps fair to both the customer and the contractor is for the contractor to lower his seasonal price so that customer gets increased savings. This increased savings by the customer is needed to offset the years when the cap charge is imposed.

So the long term year cost average is the same as whether there was seasonal pricing without a cap and seasonal pricing with a cap.

Now what I want to see is how many people that are now using caps have lowered the seasonal pricing along with charging more once the cap is exceeded to keep the average fair to both themselves and the customer?
 
oarwhat;1977556 said:
This is how a seasonal with a cap works in my opinion.

Let's say your area plows 20 times a year on average and the lot is worth $10,000.

You agree to plow the lot 15 times for $7,500 and $500 per push after that. (or by the hour, inch or whatever)

So in a light year you're guaranteed $7,500 and the customer saves $2500. If it's per push who knows what you get.

In a normal or heavy year you get paid what you're supposed to get and the customer pays the normal price.

This is a win win for both sides. Okay let the bashing begin.
finally - something that makes sense. however, i would not consider this to be a "seasonal" - this is a contract where both parties agree to pay for 15 pushes (whether or not that number is actually reached, and then a set amount per push thereafter. now if that is what people consider a "seasonal with a cap" to be, then i see the benefit to both sides if annual average is 20 pushes. but i really think using the term "seasonal" here is a misnomer. regardless, as a customer i would still be looking for a true seasonal, or a per push arrangement.

anyway, thank you for clarifying. it took four full pages for someone to actually answer the question. and i bet there are others out there with yet another definition of "seasonal with a cap".
 
Discussion starter · #80 ·
Only problem with that deal is,there still an unknown as to what the extras might cost them. Say they agree to that. So now they know how much to budget for the first part.But now they need to plug in another figure in their budget to cover the rest. So they ask you,about how much more should we budget for the rest of the season? Unfortunately,their are shady plow guys out that will plow an inch instead of the contracted amount so they can burn throught the agreed upon plows,Then they start banging you for all these extra plows.
 
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