Commercial plowing estiamting
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866 Posts
Brian-
While most guys do not like to talk hard prices here- there has been some discussion on how to figure price, I'm going to say two things that I'm sure you'll hear often-
1. Do a search- I know it's kinda confusing, but well worth the effort to go through all of the threads that you will turn up. You will get more information that way than just by guys jumping in and saying a few words here. After he search if you have more detailed questions, go ahead and post them- at least then you'l have a narrower topic, and get better quality responses. Just asking about pricing covers waaaay too much ground.
2. If ou are going to do any commercial plowing and are serious about the business, and want to succeed- join SIMA- Well worth the expense and they have books specifically on this subject, as well as training seminars held on a regular basis.
That being said, hapy hunting, good luck, and any other questions that pop up, jot em down here- we'll be glad to try and answer them for ya!
Bill
While most guys do not like to talk hard prices here- there has been some discussion on how to figure price, I'm going to say two things that I'm sure you'll hear often-
1. Do a search- I know it's kinda confusing, but well worth the effort to go through all of the threads that you will turn up. You will get more information that way than just by guys jumping in and saying a few words here. After he search if you have more detailed questions, go ahead and post them- at least then you'l have a narrower topic, and get better quality responses. Just asking about pricing covers waaaay too much ground.
2. If ou are going to do any commercial plowing and are serious about the business, and want to succeed- join SIMA- Well worth the expense and they have books specifically on this subject, as well as training seminars held on a regular basis.
That being said, hapy hunting, good luck, and any other questions that pop up, jot em down here- we'll be glad to try and answer them for ya!
Bill
This question has many answer and will very depending on where you live, and is better answered from guys in your area.
First,What you need to take into consideration is your operating expencises.( Gas, insurance, repair cost ect...)Talk to a few contractors in your area to see how they charge and what the going hourly rate is for your area
Second how are you going to charge them per hour, per push, or on a seasonal contract. Per push IMO will make you the most money.
Third the amount of time it will take you to plow the lot.
First,What you need to take into consideration is your operating expencises.( Gas, insurance, repair cost ect...)Talk to a few contractors in your area to see how they charge and what the going hourly rate is for your area
Second how are you going to charge them per hour, per push, or on a seasonal contract. Per push IMO will make you the most money.
Third the amount of time it will take you to plow the lot.
Joined
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1,279 Posts
Don't forget price points for inches of snow, 2"-6" 6"-10" over 10" or something like that depending on the norms for your area. Otherwise your rates will be way too low on the top end or way too high for the low to middle snow falls. If you go per push an increasing scale should be the norm.
Also consider that most larger property will want to know if you will me able to "relocate snow OFF of the property" (the real meaning of snow removal v. snow plowing). This is something that is usually billed per hour, per type of equipment. For example: 1 bucket loader $XX.XX per hour, 2-6 wheel dump trucks $XX.XX per hour. Just in case you get asked the question either up front during bidding or after there are a few mountains of snow in the parking lot.
Not sure if you would agree Ken, just what I have seen as I grow and have been looking to expand to bigger jobs.
Hope it helps.
Also consider that most larger property will want to know if you will me able to "relocate snow OFF of the property" (the real meaning of snow removal v. snow plowing). This is something that is usually billed per hour, per type of equipment. For example: 1 bucket loader $XX.XX per hour, 2-6 wheel dump trucks $XX.XX per hour. Just in case you get asked the question either up front during bidding or after there are a few mountains of snow in the parking lot.
Not sure if you would agree Ken, just what I have seen as I grow and have been looking to expand to bigger jobs.
Hope it helps.
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1,044 Posts
CNY Joe
I have done per push for years, but switched over to season contract. The nice thing is I receive a check each month, if I plow or not. IMO, to have some seasonal and some pur push is the way to go.
All my commercials are seasonal and my residentals are per push. That way I get more money if it is a heavy snow, because my res. are at a higher trigger.
Everett
I will agree with that statement, if you have a good winter. What happens if there is a below than average snow fall?
I have done per push for years, but switched over to season contract. The nice thing is I receive a check each month, if I plow or not. IMO, to have some seasonal and some pur push is the way to go.
All my commercials are seasonal and my residentals are per push. That way I get more money if it is a heavy snow, because my res. are at a higher trigger.
Everett
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866 Posts
I also try to give myself a mix of seasonal and per push accounts. I usually average 150-200"+ each season- so I could go either way and not really have a problem- especially since my clients are all aware of how much snow we get and that they will be paying more. It's nice to have some per push accounts during a really heavy year- makes for some long days, but a nice bonus cash wise!
BTW- hope I didn't come off ass standoffish or offending to anyone in my first post- I was simply passing along what has been told to me in the past- and I found that when I did the searches, and went through the threads I found a ton of information that was mentioned in one thread but not another. It is impossible to take all the experience here on the site, put it all into ONE thread to help out everyone. Things are covered in depth in certain topics, but not in others, so a search may be the lengthiest way to get answers- but it's the most in depth, and then when you are better armed you can start asking more detailed questions to the pros. This is how I started, and speaking from the experience- it was worth it.
Ok, I'll jump down off my :soapbox now and let us get back to SNOW !!!! Sorry for the rant, and thanks for letting me and taking the time to read it.
Bill:burnout
BTW- hope I didn't come off ass standoffish or offending to anyone in my first post- I was simply passing along what has been told to me in the past- and I found that when I did the searches, and went through the threads I found a ton of information that was mentioned in one thread but not another. It is impossible to take all the experience here on the site, put it all into ONE thread to help out everyone. Things are covered in depth in certain topics, but not in others, so a search may be the lengthiest way to get answers- but it's the most in depth, and then when you are better armed you can start asking more detailed questions to the pros. This is how I started, and speaking from the experience- it was worth it.
Ok, I'll jump down off my :soapbox now and let us get back to SNOW !!!! Sorry for the rant, and thanks for letting me and taking the time to read it.
Bill:burnout
You're asking two questions... one about estimating (determing your job price based on time/materials/equipment) and one about pricing structure or types of contracts. What is it that you want to know?
For estimating you need to know your production rates. For instance, how long does it take you to plow 2" of snow in an open 1 acre parking lot? How long in a lot that has more obstructions? What about 4" of snow?
As for pricing... how much do you need to charge for each hour you are plowing? What are your direct costs, over head recovery costs and profit? Once you come up with a number per hour for plowing and you estimate how long it will take you to plow a lot, you can determine an approximate price for plowing a lot assuming the conditions/factors you are considering.
When it comes to contract type you need to know what type of pricing is standard for your area. It's tough to sell contracts with different pricing strategies that prospective customers are used to seeing or considering. Check out the SIMA site regarding the different types of contracts. As mentioned above, there are threads about different types of contracts. Once you've read through some of them you'll be able ask more focused questions that we can help to answer with better information. Right now your question is a little nebulous.
For estimating you need to know your production rates. For instance, how long does it take you to plow 2" of snow in an open 1 acre parking lot? How long in a lot that has more obstructions? What about 4" of snow?
As for pricing... how much do you need to charge for each hour you are plowing? What are your direct costs, over head recovery costs and profit? Once you come up with a number per hour for plowing and you estimate how long it will take you to plow a lot, you can determine an approximate price for plowing a lot assuming the conditions/factors you are considering.
When it comes to contract type you need to know what type of pricing is standard for your area. It's tough to sell contracts with different pricing strategies that prospective customers are used to seeing or considering. Check out the SIMA site regarding the different types of contracts. As mentioned above, there are threads about different types of contracts. Once you've read through some of them you'll be able ask more focused questions that we can help to answer with better information. Right now your question is a little nebulous.
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5,721 Posts
No. The going rate is not always the answer. The going rate might not be enough to make this work profitable for you. Sometimes it is, but sometimes it just isn't. You need to figure out what your overhead is, like Lawn Lad said.
~Chuck
~Chuck
You must figure out your own rate. It is important to know what "the going rate" is so that you know if you're competitive or not. If you're too high, than you need to trim some overhead to become more competitive or find a more efficient way to do the work. Or... if you're too low, increase your prices. Bench marking against your competitors is important, so yes, do know what the going rate is. But don't base your price off of theirs just because. You need to know what your break even point.
Once you know how much you have to charge to be profitable, you can then estimate hours required to do the work and then come up with a contract that will be acceptable in your market.
Once you know how much you have to charge to be profitable, you can then estimate hours required to do the work and then come up with a contract that will be acceptable in your market.
When I first started with commercials I would go to the property after hours and test the lot by imagining 6 inches or so of snow on it and where the heck am I going to put it. Then figure out about how long it will take you to do the job and then add a fudge factor of maybe 15 to 25%.
Then figure out what you need to bill per hour for your costs and then add in a reasonalbe profit. With my old equipment I was averaging about $100 per hour. Now with the newer equipment and faster plow times I've raised my target significantly. This keeps the older customers pricing in line with the past and new customers will be paying on the same basis.
Then I speak personally with each property owner/manager and explain my charge per push, when I will push, and any special circumstances; ie, blizzards etc.
I have never had a contract with any client. never lost a client because of price or performance. I inspect the property prior to snow to make sure that nothing has change and I usually make personal contract with the owner/manager once or twice a season. Had a bunch of new commercial customers this year and I visited all once or twice before the 1st event, then I visited immediately after the storm to review with the client and present the first bill.
good luck, it's not as difficult as it seems. Just don't underbid to get the job, you will be stuck with that price with only modest increases every year. Every time you go to the job in future years you will kick yourself for the pricing?
~jerry~
Then figure out what you need to bill per hour for your costs and then add in a reasonalbe profit. With my old equipment I was averaging about $100 per hour. Now with the newer equipment and faster plow times I've raised my target significantly. This keeps the older customers pricing in line with the past and new customers will be paying on the same basis.
Then I speak personally with each property owner/manager and explain my charge per push, when I will push, and any special circumstances; ie, blizzards etc.
I have never had a contract with any client. never lost a client because of price or performance. I inspect the property prior to snow to make sure that nothing has change and I usually make personal contract with the owner/manager once or twice a season. Had a bunch of new commercial customers this year and I visited all once or twice before the 1st event, then I visited immediately after the storm to review with the client and present the first bill.
good luck, it's not as difficult as it seems. Just don't underbid to get the job, you will be stuck with that price with only modest increases every year. Every time you go to the job in future years you will kick yourself for the pricing?
~jerry~
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