# Tricky Bid



## Broncslefty7 (Jul 14, 2014)

i know its early, this is a customer whose pool we built and continue to maintain weekly. their current snow contract expires in may. they called and asked me to start working something up for next year. its an odd account, its half commercial, half residential basically. the cottages to the left are owned by the commercial property. Sidewalks are not included in pricing. 0 tolerance account. how would you guys go about this one, im thinking 1 550 with spreader and plow, and 2 skids, 1 with a 10' pusher and 1 with a 9' plow. i like the AG tractor idea, but i have 0 use for that during the summer so id like to try and stay away from that. there are looking for a 4 year agreement.


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## Mark Oomkes (Dec 10, 2000)

Do you use your summer equipment in the winter?


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## Broncslefty7 (Jul 14, 2014)

Yes, the only vehicles we do not use in the winter is two of our service vans. all of our construction trucks and machinery is used in the summer and winter.


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## Mark Oomkes (Dec 10, 2000)

So no, you don't. 

Guaranteed (more or less) 4 year contract that an ag tractor\blower would be perfect for.


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## Broncslefty7 (Jul 14, 2014)

an ag tractor may be the answer, i am not concerned with which equipment to use as much as i am with how to price this. generally about 90% of our accounts are inch rate. i have 1 seasonal account where we took last years number from the awesome winter and divided it by how many months they wanted to pay for. worked pretty well for this winter. i could price this by the inch but im not sure the next step to take after that. also this is an "old person city" retirement home, so extra attention and time will most likely be needed.


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## JMHConstruction (Aug 22, 2011)

Just curious, how does price per inch work if it's 0 tolerance? Do you just go by what the storm total was? With 0 tolerance I would think per push or seasonal would be better suited, since you will push more than once even in small storms. Plus you have to pay a lot more attention to those accounts, make sure you get a price you need. Last year was my first experience with zero tolerance, and it was a little overwhelming for the type of outfit I have.


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## chevyhauler (Oct 21, 2014)

I price my seasonals and by the inch accounts the same...for the most part.
Start with looking at the lot and figuring out how many hours and how many pieces of equipment to plow it for a decent (3"-5") storm. Obviously difficulty of lot (snow placement/obstacles/multiple sidewalks etc) will affect that. Once you get that number you can increase for larger storms and decrease for smaller storms. That gives you the inch rates that you are very familiar with. Then you look at what a decent winter would be for storms (how many and of what size). Figure a decently heavy winter (maybe a 7 or 8 out of 10 in regards to storms and inches). I also put a couple of CYA things into my seasonals. #1 I put in a blizzard clause. If it snows more than 12" for any given storm, the price is up to me based on number of inches, weight of snow and duration of storm. #2 I put an 80" cap on my seasonals. With a total snowfall of more than 80"...the price reverts back to the inch pricing on top of what they would have owed me seasonally. Lets say that we get a 3" storm and a 6" storm after they pass their 80" cap. They owe me for the seasonal rate...plus a 3" storm and a 6" storm using my inch pricing. 
So when I write seasonal contracts, I include both the seasonal #'s and the inch #'s so that they can see what would happen and what it would cost if we go over. I always ask customers, who do u want to gamble. If you want to gamble, go by the inch. If you want me to gamble, go seasonally. It all works out the same in the long run if you write your ##'s correctly.
So it's really the same thing. Mix your by the inch price with your historical data of a decently heavy winter to get your seasonal price. Just make sure to cover your a$$ with a couple of clauses in there.
I have heard before that an optimal mix for seasonal vs inch is 50/50 to hedge your bets well enough. After loosing a few accounts when my ex-partner dropped out (and I dropped some of "his" accounts that I didn't like) my mix is more like 80% seasonal and 20% inch. I should be able to fix that some this coming year. 
I am sure that opinions will vary on all this. Rock on!!


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## chevyhauler (Oct 21, 2014)

JMHConstruction;2136892 said:


> Just curious, how does price per inch work if it's 0 tolerance? Do you just go by what the storm total was? With 0 tolerance I would think per push or seasonal would be better suited, since you will push more than once even in small storms. Plus you have to pay a lot more attention to those accounts, make sure you get a price you need. Last year was my first experience with zero tolerance, and it was a little overwhelming for the type of outfit I have.


good point!
I don't have any zero tolerance lots...thank God!
I would imagine that the really tough parts comes when it is snowing faster than it takes you to push it. Lets say its snowing 2" or 3" an hour and it takes you an hour to push everything. Do you have the equipment and labor to just leave on site? Or do you just back in a semi full of salt? LOL


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## Broncslefty7 (Jul 14, 2014)

i was trying to say i could price this one per event by the inch like we normally do, but i have not really priced a seasonal account, i am trying to learn how to do it.


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## chevyhauler (Oct 21, 2014)

Exactly. 
U know your inch pricing. 
Now u just look at your historical data and (at least I use) a more than average winter. Something like a 7 or 8 out of 10 for snow fall. If it's a 10 of a winter, your clauses kick in. The 9's are the only ones where u loose. A 7 or an 8 and your numbers are spot on. 6 or below (like this past winter) and u are happy as a pig in *****.


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## Broncslefty7 (Jul 14, 2014)

i was thinking of capping seasonal snow fall at 60" last year we got 78" this year we got 26"


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## chevyhauler (Oct 21, 2014)

That will just change your #'s some...that will depend on what you want for a business model.
I just did a search on average snowfalls for the Hartford area. Depending on who you ask, the average ranges form 37"-49". If you set your cap at 60" you will have to adjust your seasonal #'s down some and be ready to be hitting up customers more frequently than I do. Personally (obviously a matter of opinion) I don't like going after customers to have them write another check...on top of what they were expecting. Just leaves a bad taste in their mouth. I set my seasonal numbers a bit higher to allow me to bring my cap up. They agree to the higher numbers and see that I seldom hit them up for more $$. Again, doing seasonal #'s makes US the ones who are gambling. With you considering a 4 year contract...you are throwing a pretty big set of dice. Last year I my #'s were low for the seasonal...but as you said, it was a pretty good year for snow. I would gauge last year as a 9/10. That's where the 80" cap and my 7-8 seasonal pricing is the least favorable to me. Also, we were 2 " from hitting my cap. It is on years like that where you end up making more $$ off of your inch accounts. That's where the 50/50 mix comes in. This year I was Fat and Happy. I didn't make much off my inch account but barely had to work for my seasonals. My hourly rate this year was through the roof.
If you can get a customer to agree on pricing which covers you for a 7-8 (rating out of 10) winter AND set your cap at 60" AND get them to write you additional checks.....ROCK ON!!! Otherwise you need to drop your seasonal $$ and be ready to hit them up for more $$. You could also set this after a good conversation with the customer, once you have some numbers put together. Give them the choice before you write up a contract. That will take the sting out of coming for more $$ OR show them the higher cap (but higher seasonal) which protects them better than the next guy.


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## 1olddogtwo (Aug 6, 2007)

Just my little $0.02 and it's worth less then that.

The term zero tolerance™ is just a ridiculous statemen.

I don't mean to bash the OP by any means. It's the statement and what it infers. 

By the way, that term has been trademarked by Tover snow.


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## SnoFarmer (Oct 15, 2004)

What good is it doing Trevor ?

I see the term used in maney industry's, 
Just do a search.

I highly dought any of them are sending Trevor any $.


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## Mark Oomkes (Dec 10, 2000)

BTW, I have trademarked the term "snowplowing"..........lol.

http://www.imdb.com/title/tt3727690/

https://zt.kaiusaltd.com/

https://en.wikipedia.org/wiki/Zero_tolerance

https://en.wikipedia.org/wiki/Zero_tolerance_(schools)

http://www.ztmag.com/

https://www.google.com/search?q=zer...wYHMAhUI4SYKHYmoDJsQ1QIIcCgD&biw=1920&bih=960

http://takingnote.blogs.nytimes.com...reveals-the-problem-with-zero-tolerance/?_r=0

http://www.vera.org/sites/default/f...ds/zero-tolerance-in-schools-policy-brief.pdf

Tovar doesn't even show up on the first 2 pages. They better get their attorney's cracking, they have a lot of work to do.

Apparently they're not the only ones:

https://trademarks.justia.com/788/50/zero-tolerance-78850814.html

https://trademarks.justia.com/783/92/zero-tolerance-78392100.html


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## 1olddogtwo (Aug 6, 2007)

Interesting take on Zero.


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## Broncslefty7 (Jul 14, 2014)

i understand 0 tolerance is ridiculous, the way i interpret, it is that when it starts snowing people are on site ready to go, and if it is a prolonged storm someone is staying on top of it or checking regularly.


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