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retainers or billing... and newbies who might not pay!

Discussion in 'Introduce Yourself to the Community' started by bigjeeping, Aug 17, 2005.

  1. bigjeeping

    bigjeeping Senior Member
    Messages: 678

    I'm looking at 100 residential accounts. First Year. 3 Trucks.

    I've been doin lawn care for awhile and I send out an itemized bill monthly, but I dont think that will cut if for plowing because I figure I'll pick up a lot of newbies each snow and I don't want to wait a month for their cash if they're not already established with me.

    So Here's what I figure... LET ME KNOW WHAT YOU THINK

    For everyone signing up with me for service, keep a retainer equivilent to 5-10 plows. Send them notices when their retainers runs low and inform them that it must be paid again before it runs out to avoid disruptions in service.

    Now.. with people who call me in the middle of the storm and say come plow me!.. what do I do? I think the cash on the spot would be the best?

    Please let me know of ANY retainer methods/billing methods for accounts and for newbies who call during the storm
  2. Killswitch

    Killswitch Senior Member
    Messages: 246

    Hey A2.....hows it goin.
    Im new to the business myself but I know this much. People dont like paying up front for anything these days unless they are getting a good discount.

    Let us know how it goes but its not something Im going to do any time soon. I know some guys do it as I have heard but I'm still going to bill monthly. Bi weekly if their memories become a problem which is also common place or so I hear.

    Im asking anyone on contract for two payments. One on December 15th and one on January 15th.
  3. TriCountySnow

    TriCountySnow Member
    Messages: 34

    Better Late than Never

    Just lock them into a contract for the yr. dont pay take them to court, chances are that you will win everytime, trust me we did this last yr gentleman pay first month then didnt pay secound month, we got alot the first month, then not alot the next. he thought that he would shovel it, crews drove up saw that it was cleared. pushed end of drive were plows went by charged him 25 bucks. didnt pay went to court for no pay, got all money plus he had to pay court costs. Contracts are Good for the deadbeats who think that people that plow snow are just hillybillys, showed him.
  4. Vaughn Schultz

    Vaughn Schultz PlowSite.com Addict
    Messages: 1,565

    I really think that 5 to 10 plows is too much. As with every company you need to build into your price for theft. You know it is going to happen and there is really not much you can do about it. In the long run you may ultimately lose far more money (less accounts) being over protective with people than you ever would have lost with theft of service. This is the same reason that at 7 11 or any other gas station or convent mart has the candy bars are on a rack right by the door. They will sell WAY more if the candy is on rack and not behind locked glass doors. Sure they know that some will get stolen on a rack but PROFITS will still ultimately be higher.

    I just think that if you will lose more in profit taking a 5-10 storm retainer (people just don't want to pay that much in advance), than you could ever lose in theft . ( Although it sure would help the cash flow)

    Just my thoughts I could be way off :eek:

    I would demand payment at the time of service for one time flag downs :gunsfiring:
  5. T-MAN

    T-MAN PlowSite.com Addict
    Messages: 1,363

    Start accepting visa threw your nextel for your flag downs. not to burst any bubbles but around here you rarely get a flag down. Last season when we got the 14" dump I had a couple that came out to commercial lots looking for a push I turned them all down as it was the height of the storm and I had lots to clear. I really think your going about this the wrong way. A start up company is not going to get 10 pushes up front unless you do seasonal and like stated before it will have to be one hell of a savings to get any bites. Give your customers the benefit that they will pay you , slow pays are not uncommon so dont panic. This is a service industry so I would suggest the Visa approach all though it costs you more money.
    There is one company (very established, has articles in Snow Business) that gets 5 pushes for start up but I think he has been in business now around 30 years and this is all high end residential.
    Anyway goodluck and dont stray to far from the pack or it will definitely affect your route size.
  6. bigjeeping

    bigjeeping Senior Member
    Messages: 678

    Well I've decided to ditch the whole retainer idea.
    Right now, with lawn care, I send out a monthly bill.
    For plowing... should I send bills monthly also? biweekly?

    any thoughts here would be appreciated!
  7. Vaughn Schultz

    Vaughn Schultz PlowSite.com Addict
    Messages: 1,565


    any one used this?
  8. T-MAN

    T-MAN PlowSite.com Addict
    Messages: 1,363

    I have not used those products

    BiGJeeping what sort of accounts are you doing mainly ? Residential probally wont pay weekly but I dont think biweekly would be so bad and it stays fresh in there minds.
    Commercial every event unless you are in a heavy snow belt.
    Dont let em pile up they can get crazy on per event so waiting that long may shock some, so stay on top so if they do get behind everyone is on the same page. Some heavy weeks or months can get the bills up there and for small business you may need to help them get by and spread it out.
    Big business you will be lucky to see payouts in 30 days, just the nature of the beast.
  9. bigjeeping

    bigjeeping Senior Member
    Messages: 678


    Ill be doing all residential...

    I'm thinking about biweekly billing. What type of payment policy should I have?

    exp: payment must be recieved within one week of invoices?
    If not then.... late fee?
    (flat-rate late fee or % late fee?)

    I have some resi. lawn accounts who are deathly slow at paying. Usually take 2-3 weeks after I invoice to recieve their check.

    I am going to be charging by the job not by the season (last year we had TONS of snow and some plow folk told me they got screwed charging for the season)

    Most of my residential will be $20-$30 jobs (drive, sidewalk, salt)

    From what I have been reading on plowsite, you start plowing when the snow hits your trigger. I am assuming that this is because if you wait until the snow is completely done, there will be too much snow to plow efficiently.
    I am thinking about having a 3" trigger.
    Anyway...... so i start plowing at 3", and say we get a total snow of 8", therefore I would have to return to some of the houses and plow again. DO I CHARGE the same for the return visit? Will people freak out over this?
    If I clear someone's drive and then it gets another 2" of snow on it, will the salt melt all of it? Will the costumer flip out and think I didn't come through with my job of "snow removal"?

  10. pbeering

    pbeering Senior Member
    Messages: 266

    Bill after every storm. Use one or another of the credit card services and bill out the morning after the snow is plowed. Automate the process using Quickbooks or a dedicated software package.

    Figure out what your customers want/need. People on call, doctors, etc. will need to be out early.

    Plow with the storm and be sensible, it is better to eat a return trip now and then than to lose the account.
  11. T-MAN

    T-MAN PlowSite.com Addict
    Messages: 1,363

    Be sensible is right ! If you have one inch triggers and the storm is only supposed to be 1-2 and it starts at 8pm dont think your going to be able to bill 2 pushes. You have to watch what is going on and be alert. If you have your route at a manageable size you can wait till 12 pm to head out or even wait till one am if the storm is fizzleing out. This is were experience helps or buddys with experience can help you out. You have to make the call, and the wrong call can cost you. Dont expect your customers to pay for a bad call.