# New business questions



## Blizzard38 (Aug 28, 2015)

I'm in the process of starting a facility management/property maintenance company. One of the services we would manage is snow removal. My company is more from a management perspective of maintaining a facility and all of the usual sub contracted services. I don't have a plow and have no intention of performing snow removal or ice management services at this time. Thanks in advance for any info that you can provide. This site has been great.

Insurance- I've done a lot of reading and made a few phone calls. Some suggest I would need snow removal insurance since my company is technically responsible for the service. Others think general liability would be enough especially with passing on liability to the sub contractor and or being added to their insurance as additional insured?

Bids-I'm assuming most companies would use an hourly rate then determine the length of time it would take to plow. What other factors affect your quote? If you received payment the following day for your services would you bid the job differently?

Obviously we are being paid by the business whose facility we will maintain however I realize the importance of maintaining a positive relationship with our subcontractors.

Any other insight or advice would be greatly appreciated.


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## SnoFarmer (Oct 15, 2004)

Have you meet Mr.Jhon Allen?

http://www.johnallin.com

why would we want a middleman to get his hands on our $$
When We can go to management ourselves.?


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## Wilnip (Oct 4, 2011)

No offense to you, but read some posts on USM, Merit, Brickman, and countless others. You will find many members here are not pleased with the way they treat subs. Probably won't get much help from Plowsite members.


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## 1olddogtwo (Aug 6, 2007)

Bud, u just walked in to the lions den at dinner time.

U won't find much help here as most will not work for a middle man such as what ur proposing


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## Sawboy (Dec 18, 2005)

I'll echo everyone else's sentiments. We aren't going to help middlemen who do nothing, other than collect checks on the backs of our efforts. I will add that I'm quite impressed at how everyone has responded cordially.


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## Blizzard38 (Aug 28, 2015)

Apparently I touched a nerve, that wasn't my intention. As someone who has been in management and in charge of signing snow removal contracts, I meant more to allow a business to outsource all of their facility needs (which will usually be 10-15 different services in a year) through one point of contact. If you can submit a bid on a lot to me because a company has hired me to handle that process what's the issue? You would get whatever price you agreed to. I do appreciate the feedback and I apologize if I've offended anyone.


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## Camden (Mar 10, 2007)

You can pull off what you're proposing as long as you've got the financial backing necessary. The reason so many people get a sour taste in their mouth when they hear the words "management company" is because the person who hired them didn't have enough working capital to pay their sub contractors until they themselves got paid.

It's backfired more often than not. Some guys are owed 10's of thousands from these management companies and the outlook to get paid is pretty grim. 

Several years ago I adopted the philosophy of "if you can't beat 'em, join 'em" and now I have a quasi-management company of my own. I only have a few clients but I am responsible for over 1000 locations. You'll never see my name on these message boards saying that I didn't pay my subs. They all get paid before I do. Aside from my own cash, I have a line of credit that can cover me if I would ever run short. You're going to need something similar because you'll get blasted if you don't pay your subs in a timely fashion. 

As far as insurance goes, I am the contractor on record for my clients therefore I'm the one who carries the insurance.


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## SnoFarmer (Oct 15, 2004)

Ok so they hire you to hire me,
Why is the pie still the same size as when you didn't work for them.

In other words the pie is smaller for me becuse they have to pay you to find me.

Or are you the new Angie's list of snow removal?


You have a rough road to hoe as a lot of guys have been burned by the Nationails


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## Diesel Dan (Sep 8, 2012)

Guys on here B**tch about middlemen, but hire subs...

I have no problem with subcontracting, it's how 90% of our got our start in this business.


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## Blizzard38 (Aug 28, 2015)

Camden;2022301 said:


> You can pull off what you're proposing as long as you've got the financial backing necessary. The reason so many people get a sour taste in their mouth when they hear the words "management company" is because the person who hired them didn't have enough working capital to pay their sub contractors until they themselves got paid.
> 
> It's backfired more often than not. Some guys are owed 10's of thousands from these management companies and the outlook to get paid is pretty grim.
> 
> ...


Excellent info Camden thank you. I will be operating in the same manner.


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## Sawboy (Dec 18, 2005)

Thank goodness! Another national to shuffle paper and collect 60% of the bid for doing nothing. We need more of those.


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## Sawboy (Dec 18, 2005)

Diesel Dan;2022311 said:


> Guys on here B**tch about middlemen, but hire subs...
> 
> I have no problem with subcontracting, it's how 90% of our got our start in this business.


If you don't know the difference between an NSP, and working as a real sub, I feel bad for ya.


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## LapeerLandscape (Dec 29, 2012)

Management companies are just like the Federal Government, they take $$$$$ and do very little for it.


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## Mark Oomkes (Dec 10, 2000)

Subscribed.......


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## Blizzard38 (Aug 28, 2015)

I am not a national. This will be a local operation. Taking care of a larger facility is time consuming and a 24/7 job. There is a often 10/15 sub contractors that are needed in a typical year. If a business sees value in hiring me to handle that work load it really shouldn't matter to any snow removal companies. You submit your bid and sign a contract and will be paid quickly. I see some negativity yet no one has made a legitamate argument. I understand payment issues seem to be a concern which is why I'm planning for that to be a strength of my company. Claiming that I'm "taking your money, or a piece of the pie" or "doing nothing and taking a cut" aren't supported by any facts. If you sign a contract with a $ amount that you submitted, and then are paid quickly for your services, what is the problem?


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## SnoFarmer (Oct 15, 2004)

Blizzard38;2022410 said:


> I am not a national. This will be a local operation. Taking care of a larger facility is time consuming and a 24/7 job. There is a often 10/15 sub contractors that are needed in a typical year. If a business sees value in hiring me to handle that work load it really shouldn't matter to any snow removal companies. You submit your bid and sign a contract and will be paid quickly. I see some negativity yet no one has made a legitamate argument. I understand payment issues seem to be a concern which is why I'm planning for that to be a strength of my company. Claiming that I'm "taking your money, or a piece of the pie" or "doing nothing and taking a cut" aren't supported by any facts. If you sign a contract with a $ amount that you submitted, and then are paid quickly for your services, what is the problem?


Yes ,if you sign a contract you agreed to the price.
And you sigen the low baller.
Why would you take the high or mid price bidder as you have to save them $$$
to earn your fee.
You have to save tha company money to justify your "service" Right?
How is this good for us, To play a active roll in the race to the bottom?

it doesn't really matter if your compeneys is named as the primary or as the insured,
A contractor doing subcontracting still is a separate business that is hired, they have to carry the level of ins that is required. They are not your employe.


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## 1olddogtwo (Aug 6, 2007)

Pipe dream....

That never happens in the real world. 

What happens if they don't pay you?

What happens when they change the requirements after you have a signed contract with a contractor?


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## Camden (Mar 10, 2007)

I'm loving these comments....


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## Derek'sDumpstersInc (Jul 13, 2014)

OK, I will try to explain what everyone else is saying that you aren't understanding. These #s aren't accurate, just using easy #s for ease of discussion. You approach Wally World with your proposal to manage their facility for them. Wally World used to handle this on their own, so they know that they have had snow services done in the past for 300.00 per occurrence, so they won't pay more than that. So now, you have to find someone that will plow the site for 225.00 so that you can bill WW 300 and make your cut. The problem is is that the only contractors that will service that size property for 225 are the low ballers with junk trucks/plows that are always broke and unreliable. So now WW says piss on you, our lot wasn't serviced on time and we lost business because all the crack heads cars got stuck in their lot trying to go spend their welfare checks on their monthly allowance of Eggo waffles and Schlitz beer. So you don't pay the contractor who screwed you out of the account and go in search for another. Sooooo, long story short is you want the good reliable contractor to service your account for you at the low baller rate. That is what we mean by taking our money for shuffling paperwork. Hope that helps clear it up. I do wish you luck, sounds like you are at least TRYING to do it right.


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## 1olddogtwo (Aug 6, 2007)

Anyone know the difference between a NSP and a LSP?


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## Derek'sDumpstersInc (Jul 13, 2014)

1olddogtwo;2022513 said:


> Anyone know the difference between a NSP and a LSP?


National Service Provider and ????


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## 1olddogtwo (Aug 6, 2007)

derekslawncare;2022520 said:


> National Service Provider and ????


 local service provider


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## Derek'sDumpstersInc (Jul 13, 2014)

1olddogtwo;2022534 said:


> local service provider


I assumed that was it, but it seemed too easy, and you know what happens when you assume.


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## Defcon 5 (Mar 20, 2014)

1olddogtwo;2022513 said:


> Anyone know the difference between a NSP and a LSP?


I thought you said LSD...You should be on LSD to deal with an NSP..


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## thelettuceman (Nov 23, 2010)

Mark Oomkes;2022363 said:


> Subscribed.......


No offense to anyone who posted but this is the most intelligent comment I've read. Subscribed myself


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## Luther (Oct 31, 2007)

Blizzard38...there is only one thing that will set you apart from the other dreaded NSP's, RSP's snd LSP's we all can't stand for...are you willing, and will it be your policy to pay your subcontractors whether or not you get paid?

The fact remains it doesn't matter whether or not you get paid. If your sub did the work and met his contract obligations...he must get paid. Period. 

Are willing to put that down in writing? If so, you're different. If not...you're the same old same old.


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## Mark Oomkes (Dec 10, 2000)

thelettuceman;2022680 said:


> No offense to anyone who posted but this is the most intelligent comment I've read. Subscribed myself


That right there is signature worthy!


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## Defcon 5 (Mar 20, 2014)

TCLA;2022711 said:


> Blizzard38...there is only one thing that will set you apart from the other dreaded NSP's, RSP's snd LSP's we all can't stand for...are you willing, and will it be your policy to pay your subcontractors whether or not you get paid?
> 
> The fact remains it doesn't matter whether or not you get paid. If your sub did the work and met his contract obligations...he must get paid. Period.
> 
> Are willing to put that down in writing? If so, you're different. If not...you're the same old same old.


Holy Cow....Look who sobered up and came out of the wood work...BTW..Need to change your sig.No Longer Valid


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## jhenderson9196 (Nov 14, 2010)

TCLA;2022711 said:


> Blizzard38...there is only one thing that will set you apart from the other dreaded NSP's, RSP's snd LSP's we all can't stand for...are you willing, and will it be your policy to pay your subcontractors whether or not you get paid?
> 
> The fact remains it doesn't matter whether or not you get paid. If your sub did the work and met his contract obligations...he must get paid. Period.
> 
> Are willing to put that down in writing? If so, you're different. If not...you're the same old same old.


Putting it in writing means nothing when it's signed on behalf of an LLC that has no assets. I'd want a signed agreement that says he will be held PERSONALLY RESPONSIBLE for payment in full. I'll buy lunch for anybody who gets him to do that.


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## Blizzard38 (Aug 28, 2015)

TCLA;2022711 said:


> Blizzard38...there is only one thing that will set you apart from the other dreaded NSP's, RSP's snd LSP's we all can't stand for...are you willing, and will it be your policy to pay your subcontractors whether or not you get paid?
> 
> The fact remains it doesn't matter whether or not you get paid. If your sub did the work and met his contract obligations...he must get paid. Period.
> 
> Are willing to put that down in writing? If so, you're different. If not...you're the same old same old.


My first post mentioned immediate payment as that has always been part of my business plan, Camden confirmed how important that is. As far as the Wally World example, I have enough business sense to know that hiring an unqualified low baller is not a good strategy. If you want reliability and quality you'll pay for it. If a business thinks they can pay the same as they did and have me take care of their facility that's not going to work. I know some businesses expect that, and how well did that work for Walmart/USM?

Thanks for the constructive responses so far.

Let's say I pay the sub and I don't get paid. What are the reasons that would happen?


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## Luther (Oct 31, 2007)

I read your first post. Your intentions are all hypothetical. We can continue along those lines...

One would be a political reason of some sort on your part. It's not difficult to piss off someone in the big cold & corporate, dog eat dog arena. Another would be a procedural deficiency on your end. You may screw up on whatever reporting process or paperwork requirements you submit to the client and risk payment. Could be you're not financially sound, or mismanage your capital. Folks are still allowed to file bankruptcy, and unfortunately it is still not a crime for a debtor to fail to pay a debt. Just a couple I can think of right now. 

I do like your approach though. If you're able to accelerate payment to your service providers and wait 30, 60 days (or more) you're doing what's in the best interest to the ones actually performing the work. None of us can tell our employees, vendors, utilities, mortgage holders, etc. etc. that you'll get a check once the company gets paid.


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## jhenderson9196 (Nov 14, 2010)

Funny, I didn't see anything about being held personally responsible for payment in that answer.


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## Luther (Oct 31, 2007)

You know he won't. Who would do that??

The owner doesn't want to be held personally responsible. Kind of goes against the nature of forming an LLC, doesn't it?


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## Luther (Oct 31, 2007)

Blizzard38;2022247 said:


> Bids-I'm assuming most companies would use an hourly rate then determine the length of time it would take to plow.
> There are as many methods in coming up with pricing as there are contractors.
> 
> What other factors affect your quote?
> ...


Not sure how you could pull that off, but some would. Might not matter to others.


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## Blizzard38 (Aug 28, 2015)

jhenderson9196;2023052 said:


> Funny, I didn't see anything about being held personally responsible for payment in that answer.


As soon as you blur the lines between an individual and an LLC you lose all protection under the LLC and not just for debt. I could be potentially sued as an individual for a slip and fall if there is not a clear division of my financials. Furthermore if you sign a contract with a large retailer, do you demand that the store manager signs on as being personally responsible for payment? Before you say "yea, well his employer has assets". How well do those assets help all the guys on this forum saying they are owed X thousands of dollars from this company and they have been waiting 6+ months and it's now tied up in court? Sounds like you are being a little unreasonable.


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## Blizzard38 (Aug 28, 2015)

Thanks TCLA that's the kind of info I've been looking for.


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## Derek'sDumpstersInc (Jul 13, 2014)

Blizzard38;2023008 said:


> My first post mentioned immediate payment as that has always been part of my business plan, Camden confirmed how important that is. As far as the Wally World example, I have enough business sense to know that hiring an unqualified low baller is not a good strategy. If you want reliability and quality you'll pay for it. If a business thinks they can pay the same as they did and have me take care of their facility that's not going to work. I know some businesses expect that, and how well did that work for Walmart/USM?
> 
> Thanks for the constructive responses so far.
> 
> Let's say I pay the sub and I don't get paid. What are the reasons that would happen?


There is where you aren't understanding what most are saying here. Hiring the unqualified low baller is how most of the NSP's operate. Then, after they can't fulfill the requirements of the contract, they try to get one of the legitimate contractors to finish out the season for the low ballers pay. You should read one of the NSP's contractor agreements some day and see what all they try to get us to agree to for the "privilege" of working for them. They are a joke and most all of them tell you (if you can read between the lines) that at some point, you WILL do work that you WON'T get paid for.


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## Blizzard38 (Aug 28, 2015)

derekslawncare;2023130 said:


> There is where you aren't understanding what most are saying here. Hiring the unqualified low baller is how most of the NSP's operate. Then, after they can't fulfill the requirements of the contract, they try to get one of the legitimate contractors to finish out the season for the low ballers pay. You should read one of the NSP's contractor agreements some day and see what all they try to get us to agree to for the "privilege" of working for them. They are a joke and most all of them tell you (if you can read between the lines) that at some point, you WILL do work that you WON'T get paid for.


I completely understand that. I'm not naive to that process. I'm saying that I won't be doing that. Furthermore they can't force a legitamate contractor to fill in at the low baller rate unless they find a willing participant. Seems like that is where some of the blame should lie.


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## Luther (Oct 31, 2007)

Defcon 5;2022910 said:


> Holy Cow....Look who sobered up and came out of the wood work...
> 
> I don't like being falsely accused of things...you take that back.
> 
> BTW..Need to change your sig.No Longer Valid


Open your eyes...I don't have a sig.

And yes, I do need to dump my user name and avatar. No longer valid. Still pondering what it should be.


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## Mark Oomkes (Dec 10, 2000)

TCLA;2023133 said:


> Open your eyes...I don't have a sig.
> 
> And yes, I do need to dump my user name and avatar. No longer valid. Still pondering what it should be.


I still like JAA Jr, the Queen of Snow.


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## SnoFarmer (Oct 15, 2004)

Lets see your contract that you would have us sign.
You must have a rough raft?

At this late time of the year, I believe this to be a 
wild goose chase.

In other words if you don't have any clients, your not hiring anyone to day or tomorrow.

pS is this a school project/paper your doing research for?


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## Luther (Oct 31, 2007)

Mark Oomkes;2023135 said:


> I still like JAA Jr, the Queen of Snow.


It's not quite self deprecating enough.


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## Mark Oomkes (Dec 10, 2000)

TCLA;2023139 said:


> It's not quite self deprecating enough.


Princess of Snow? Lololol


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## John_DeereGreen (Jan 2, 2011)

I'm amazed at how civil this thread has stayed.

Following along for the info now.


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## Freshwater (Feb 28, 2014)

John_DeereGreen;2023589 said:


> I'm amazed at how civil this thread has stayed.
> 
> Following along for the info now.


That's cause all the trouble makers are just subscribed so far, oh yeah I'm subscribed. LOL!!!


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## seville009 (Sep 9, 2002)

It's important to understand the a management company is generally just an agent for the principal, which is the property owner. As long as that agency relationship is disclosed, you generally would nit have recourse against the agent. 

The best thing to do to get the managing agent on the hook is to have them sign your contract separately - they would sign once in their capacity as agent, and a second time (under the first signature) under their own name. 

In addition, if they don't sign properly when signing as the agent, it is possible that they could still be held personally liable. For example, if they just sign as "John Jones" instead of "John Jobes, Agent", tgat is enough in mist cases to mske them luable under the contract.


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## jhenderson9196 (Nov 14, 2010)

I doubt we'll be hearing from the OP anytime soon. Personal responsibility for promises made weeds out most folks.


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## John_DeereGreen (Jan 2, 2011)

Freshwater;2023594 said:


> That's cause all the trouble makers are just subscribed so far, oh yeah I'm subscribed. LOL!!!


I got my big bowl of popcorn here, just waiting for the 4th of July to begin.


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