Finding the right way to price your snow removal services is tricky, which is why many businesses never get it right.
However, when you get your snow prices right, the snow industry can be both competitive and highly profitable.
In this snow pricing guide, I’m going to show you an easy and reliable way to bid and win any commercial snow plowing job.
This quick pricing guide will allow you to make a boatload of money this winter, without “over-complicating” your prices.
Compute job length based on the hours it would take one guy, working alone to complete.
This way, you can divide by the number of crew members to get an accurate gauge of how long it will take, real-time, even if the crew size changes.
I can't tell you how much your price should be profit.
However, I can tell you the main factors that will influence how much profit you can get is your market:
I’ve seen profit on jobs anywhere from 2% - 50%. And some have even gone higher when the demand is high.
When clients want to buy snow removal services, they will inevitably look online for basic rates. You can do the same to get an idea of what people are expecting.
You should also check with local friends and family (who aren’t using you… yet) and see what they pay for snow removal. This will help you gauge what’s normal in the market.
When you decide on your profit, build it into your price. Remember: it never hurts to leave some room for accidents and mistakes.
Manage your clients and employees all in one system
You want to get familiar with the snow averages in your area. This will help you decide which pricing models will generate the most work and profit.
Some work better with lighter or fewer snow events, and for others, it's the opposite.
Use our Winter-Ready Checklist for snow businesses to diversify your contract portfolio. This way, you stay profitable regardless of what nature throws at you.
There’s no reason to set one pricing model and stick to it.
Your best bet is to apply different models to different clients, so no matter the weather, you will always get paid.
Commercial-sized snow properties take more time and materials than residential drives.
Consider the size difference between a residential driveway and the average parking lot.
But there's more to it than size:
Keep these factors in mind when bidding for commercial properties.
Don’t overextend yourself.
If you don’t have a way to service everybody, you’ll end up skipping people and juggling properties. You’ll end up stressed out with an overworked crew and a collection of angry clients.
Snow is already a demanding business. I’ve seen people work 36 hours straight. I don’t recommend it - those guys frequently end up losing money due to the number of accidents they build up.
“But the money’s too good!” - yeah, while it lasts. Too much work will result in sloppy work. Sloppy work gets clients to drop you.
People will talk. If you’re not dependable, they’ll say bad things about you.
It’s better to have a few happy clients than a horde of angry ones.
At the end of the day, it’s all about knowing your numbers, cutting down on waste, and setting the right expectations with the client.
It’s a hard business, for sure, but you can thrive in it.
There are a lot of low-ballers and companies that exist today and vanish into the wind tomorrow. You won’t die out like them and the reputation boost will bring you more clients, year after year.
When you follow this snow pricing guide, you can quickly succeed in the snow industry.
Originally published Oct 24, 2017, updated Sept 8, 2020 1:23 PM
Tags: Business Operation