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pricing being questioned

Discussion in 'Bidding & Estimating' started by GA73, Dec 23, 2014.

  1. GA73

    GA73 Member
    Messages: 90

    I have a deal with the local road commission to plow residential drive ways. when I did it 7 years ago all I did was set a per plow price for each driveway. keep in mind these drives run from 300 foot to a little better then a half mile long. these are all dirt roads and must travel a few miles in between.
    fast forward to this year in april they call and tell me they want me to take over all the drives which would be 16 drives. I purchase a new truck and plow and wait for them to come up with the details. after numerous phone calls with the foreman he says everything is a go. the day before our first storm he finally gives me the list and says plow them and then give us a price.
    our first storm gave us 4 ft in two days so got to see them at there worst. and they set a 3-4"trigger and can only plow once per day at there direction.
    after the storm I send a price list with the invoices for plowing. they pay me twice and now are saying that my rates are to high and I need to come up with a hourly rate and keep track of my time in and out of each driveway.

    they have 2 kids doing the drives in other townships and they are only charging $65/hour and keeping track of the minutes it takes to plow. no travel time included. which is what there pushing me to do.
    there is now way I can plow for what those kids are doing it for
    most of the drives could be called roads that require 4 passes to plow.

    I charge $60 for the smaller ones and as they get longer up to $150 for the longest.
  2. gc3

    gc3 Senior Member
    Messages: 713

    That's the problem when you have other people plowing the same type of drives. They are always gonna compare the prices. I would also. Figure out how bad you want the work and reprice it. They'll always find somebody cheaper
  3. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Sounds like they want you to suck up the drive time. So you add a few minutes to each driveway. Why is the town paying? Are they town roads to these driveways?
  4. GA73

    GA73 Member
    Messages: 90

    for years the county plowed driveways on a yearly contract. they are looking to get out of it next year. they charge $375 on the low end and $1100 for the long ones per year.
    the drives the others are doing are more of the normal drive in town. what they have me doing are rural drives that are long curvy billy goat trails all up hill

    after twenty years ive never worked by the clock. ive always priced by length terrain and set a per push price.
    doing my customers I average about $250/hr
    there way would be about $75/hr
  5. maxwellp

    maxwellp PlowSite.com Addict
    Messages: 1,123

    "doing my customers I average about $250/hr
    there way would be about $75/hr"

    You just answered your own question. Drop it like a bad apple and move on. Tell them you will not change your price.
  6. Meezer

    Meezer Senior Member
    from Indiana
    Messages: 300

    I would agree, drop it & leave. There is no reason to get involved in a race to the bottom.
  7. Mr.Markus

    Mr.Markus PlowSite Fanatic
    Messages: 5,779

    Put your price in and let them say no. They will always want a lower price, they answer to the taxpayer... I would never just drop it without pricing it. It's not personal...every year you have it is money in your pocket, just be ready for the eventuality that you won't have it forever.
  8. derekslawncare

    derekslawncare PlowSite.com Addict
    Messages: 1,003

    You know your business better than anyone else. We can only make guestimates going off of our own business models. If the pricing you are at is where you need to be to make it work, than that is what it needs to be. If on the other hand, you could come down a little and it still be worth your time to do, than do that. A few things I would put out to them is that I assume you are insured? Are the kids that they are comparing you to? All "legitimate" companies cost are always going to be higher than non legitimate/fly by nights. So, with your overhead vs theirs, obviously you are going to be higher. Is your equipment newer (more reliable) than theirs, you will be higher. You know the drill, explain it to them. If they can't/don't understand that, you don't want to work for them anyways. The other thing to keep in mind, and this is why I almost NEVER readjust or lower my pricing is that you are setting a president. If they complain and you lower the price, then you put the thought in their head for next year, hey he dropped once, he'll drop again. Also, you have to keep in mind, your pricing has to reflect that you "live" in your truck for 48-72 hrs every time it snows. Weekends/holidays spent plowing instead of with your family. It's ALL stuff you have to keep in mind when setting your pricing to make it worth doing. Just my $.02 worth.
  9. thelettuceman

    thelettuceman PlowSite.com Addict
    Messages: 1,218

    Times Two !!!!!!!
  10. Antlerart06

    Antlerart06 PlowSite Veteran
    Messages: 3,437

    I been up there on your roads I know some can be fun driving in summer time I would hate to plow them

    Turn price in let them tell you no Let them kids have it when snow gets to deep and not show up They will be coming back
  11. derekslawncare

    derekslawncare PlowSite.com Addict
    Messages: 1,003

    By then, he should have already found another account to fill the slot and can hopefully tell them, "Sorry, full for the season. Can't help you, or I can help you, but will be last on route, may be day or two after storm before done."
  12. snowhawg

    snowhawg Junior Member
    Messages: 2

    A very similar thing is happening to me, customers I have had for 3-5 yrs are now shopping for prices even though I have only raised slightly over that time period 5-10 $ per storm. After 20 yrs of snow plowing in my home town, now I am getting beat up. I agree with the stand your ground, determine what is worth to you, then that is it.
  13. GA73

    GA73 Member
    Messages: 90

    been running thing threw my head and there is no way I can even think about doing it by the hour. ive done a per time for 20 yrs. ive got room to lower my prices $10-$25 depending on the driveway.
    ive plowed three time since our talk. will turn in my invoices tomorrow and they can pay my rate for that and if they do not like my reductions they can do it themselves
  14. Meezer

    Meezer Senior Member
    from Indiana
    Messages: 300

    Good for you! Don't let anyone push you around.:salute:
  15. derekslawncare

    derekslawncare PlowSite.com Addict
    Messages: 1,003

    Glad to see you are standing firm. Hope it works out well for you.
  16. mn-bob

    mn-bob Senior Member
    Messages: 137

    X 2ussmileyflag
  17. Sprag-O

    Sprag-O Senior Member
    Messages: 220

    Go hourly and find yourself a 6' straight blade :) May make them think twice :p

    Good to hear you're standing your ground.
  18. GA73

    GA73 Member
    Messages: 90

    hmmm I know were there is a jeep with a 6ft belt driven
  19. Doin_It

    Doin_It Senior Member
    from Mt.
    Messages: 136

    What ever happened to the end of this story???? You still plowing? They pay your invoices? Where you at?
  20. On a Call

    On a Call PlowSite.com Addict
    Messages: 1,077

    At 65 an hour hire a bunch of immigrants pay them 8 dollars an hour and hand them a shovel.