# Clean Hands Profit From Snow/Ice Services



## mike thunder (Oct 19, 2011)

A top notch operation shows up to your place with a unique offer. They have cutting edge late model equipment, elite infrastructure and sound morals/ethics. They offer you a 7.5% gross commission in exchange for all of your snow/ice management accounts. You retain ownership of all the accounts. When the season is over you go back to your usual operation. You do nothing but allow them access to your snow/ice accounts. They have a rock solid "non-compete/no solicitation" contract to insure your not going to lose your accounts to them. They don't offer lawn/landscape service, nor do they ever want to. They have a guarantee that pays out the entire seasons worth of lawn/landscape service to you for any/all customers that cancel summer service with you because of inadequate service performed by them.
Voice your opinions.


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## NickT (Feb 1, 2011)

Subscribed


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## dieselss (Jan 3, 2008)

sounds to good to be true,,,whats in it for them/you??


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## magnatrac (Dec 22, 2006)

Ok so what are the fine details ???


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## cwby_ram (Jan 15, 2011)

Intriguing, I wanna here more too.


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## cet (Oct 2, 2004)

If I understand this correctly you are saying they will give you $7,500.00 for every $100,000.00 worth of work. I wouldn't sell my contracts that cheap. So you get it all back next year, what do you do with all your equipment this year. That's cheap IMO.


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## dieselss (Jan 3, 2008)

what if something happens to them/equip. are you going to have to go out there and finish?
are your clients going to contact you or them if something goes wrong???
still sounds fishy???


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## Pristine PM ltd (Oct 15, 2005)

Where is the liability? Sounds interesting though.


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## cwby_ram (Jan 15, 2011)

dieselss;1406802 said:


> what if something happens to them/equip. are you going to have to go out there and finish?
> are your clients going to contact you or them if something goes wrong???
> still sounds fishy???


I agree, fishy. Unique though.


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## Italiano67 (Feb 16, 2005)

How do they know you price out your jobs to even make 7.5 % profit?? Sounds like they are desperate for work. I wouldnt touch that deal. They could screw up all your business relations and the accounts might not be back.


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## dieselss (Jan 3, 2008)

Italiano67;1406812 said:


> How do they know you price out your jobs to even make 7.5 % profit?? Sounds like they are desperate for work. I wouldnt touch that deal. They could screw up all your business relations and the accounts might not be back.


how do you know that there not just gunna go behind your back next year and lowball you for the same accounts


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## grandview (Oct 9, 2005)

Why don't this company just hire a sales guy to go out and get work for them and pay a commission on it?


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## SNOWLORD (Aug 10, 2007)

This would not be for me.


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## procut (Dec 1, 2004)

Strikes me as something that could go badly quite easily.


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## icudoucme (Dec 3, 2008)

are they from Nigeria??


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## Pristine PM ltd (Oct 15, 2005)

hahaha, the concept has to many flaws, If it worked perfectly, I would be tempted!


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## mike thunder (Oct 19, 2011)

dieselss;1406769 said:


> sounds to good to be true,,,whats in it for them/you??


You would get a share (7.5%) for doing nothing but allow them to perform winter services to your customers. 
They get to provide your customers a service for a profit (business 101). Customers they otherwise would not have access to because they don't/won't offer summer services.


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## mike thunder (Oct 19, 2011)

magnatrac;1406783 said:


> Ok so what are the fine details ???


The fine details look just like all of our contracts. It contains all the basics like insurance, scope, etc;.


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## Pristine PM ltd (Oct 15, 2005)

why now? Why were they not talking to you in July?


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## mike thunder (Oct 19, 2011)

cet;1406787 said:


> If I understand this correctly you are saying they will give you $7,500.00 for every $100,000.00 worth of work. I wouldn't sell my contracts that cheap. So you get it all back next year, what do you do with all your equipment this year. That's cheap IMO.


Yes. You're not selling them, but rather leasing or renting them out. Your equipment can sit or be sold, you won't need it, making the 7.5% 90% profit. You can sign a multi-year deal as well and not have to worry about snow ops for three or five years.


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## mike thunder (Oct 19, 2011)

dieselss;1406802 said:


> what if something happens to them/equip. are you going to have to go out there and finish?
> are your clients going to contact you or them if something goes wrong???
> still sounds fishy???


They're not going anywhere and there operation is top shelf. You don't have to do anything, go to hawaii if you want, they do all the work. Theres a whole plan behind it that makes for a professional, smooth, transition from summer to winter ops. In a nutshell, you/them are made out to be "service partners". Your customer calls your office about snow, presses the number for snow operations and the phone rings at their place. The customer doesn't have to do anything special, just the same as they have been all along.


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## mike thunder (Oct 19, 2011)

Pristine PM ltd;1406806 said:


> Where is the liability? Sounds interesting though.


They assume 100% liability.


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## mike thunder (Oct 19, 2011)

Italiano67;1406812 said:


> How do they know you price out your jobs to even make 7.5 % profit?? Sounds like they are desperate for work. I wouldnt touch that deal. They could screw up all your business relations and the accounts might not be back.


They don't use your pricing unless it is within the industry standard for your neighborhood. If they can't make money in your area then they won't offer the deal to you. They like no less then 25% profit margin's. If you're clients leave because of them then they will pay you, just like the original post says.


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## mike thunder (Oct 19, 2011)

dieselss;1406816 said:


> how do you know that there not just gunna go behind your back next year and lowball you for the same accounts


Their "no competition/solicitation" agreement gives you 36 months of comfort.


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## mike thunder (Oct 19, 2011)

grandview;1406831 said:


> Why don't this company just hire a sales guy to go out and get work for them and pay a commission on it?


They are, thats what this is all about. They're getting customers they otherwise would not have access to. They come to us, buy work from us for 7.5%, and provide their service for profit to the customers they bought from us.


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## Luther (Oct 31, 2007)

mike thunder;1406884 said:


> Customers they otherwise would not have access to because they don't/won't offer summer services.


It's not necessary to offer the summer work in order to get the snow work.

Creative idea. Might be a win/win if both parties are desperate. This is assuming there are no service issues.....which will not be a safe assumption.

You have more to lose than they do.


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## mike thunder (Oct 19, 2011)

TCLA;1406912 said:


> It's not necessary to offer the summer work in order to get the snow work.
> 
> Creative idea. Might be a win/win if both parties are desperate. This is assuming there are no service issues.....which will not be a safe assumption.
> 
> You have more to lose than they do.


I'm not so sure we/you would have more to lose, but rather close to equal. I say that because they are going to pay out big (depending upon the summer figures) if they cost you your customer.


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## mike thunder (Oct 19, 2011)

Pristine PM ltd;1406890 said:


> why now? Why were they not talking to you in July?


It's not for this winter, but rather next winter and beyond.


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## BossPlow2010 (Sep 29, 2010)

mike thunder;1406927 said:


> I'm not so sure we/you would have more to lose, but rather close to equal. I say that because they are going to pay out big (depending upon the summer figures) if they cost you your customer.


So they'll pay you if you lose the account? How much will they pay because if you lose it for winter and summer, chances are you won't get it back. Ever. So if it was a 20 year account, the. You just lost out on all that profit, plus they will bad mouth you. A person / company will tell five people you're a good company. But will tell twenty people you're a bad company.
is this an example, or is a company actually doing this?


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## Lightningllc (Nov 23, 2009)

I love the idea but the 7.5 would need to be 15.


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## Superior L & L (Oct 6, 2006)

Interesting, but 7.5% is for the bird


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## Superior L & L (Oct 6, 2006)

Lol, I posted at the same time Justin. I guess we ate both on the same level


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## Italiano67 (Feb 16, 2005)

I am sure they would prefer 25%profit margin. I dont know of too many snow accounts that can pay 25% profit plus the 7.5% to you. That is the problem with this business is somebody new is always supposedly smarter than the next guy. The only thing that happens is the price goes down and everybody loses.


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## IMAGE (Oct 21, 2007)

Is this something your thinking of doing? 

What if you lose the account, and it could be for any number of reasons... you could say it's because they are not happy with the snow service, the customer doesnt have to give a reason, and clean hands says it's not their fault. I see a law suit if it's a big enough account. They won't want to pay, and you're screwed.


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## Luther (Oct 31, 2007)

How do you retain ownership of your accounts? 

You must first have a contract with the client in order to "sell" it to them, right? Connect the rest of the dots for us.

Does the client pay you....you take your cut....then you give your "service partner" the rest? If not, how does your "service partner" get paid from your client without executing a new contract with your client?


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## redskinsfan34 (Jan 14, 2010)

Mike, From reading your posts it looks like you're leaning heavily towards taking the deal. Just my opinion: In this economy I wouldn't let any potential competitors onto my accounts unless they outbid me for them. Sounds to me like they're desparate for work and when you're desparaste for work you stretch yourself thin and do a crap job. Then it will come back on you.


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## downtoearthnh (Jan 16, 2009)

I don't know the dynamics or pricing structures in Michigan, but in NH, I don't know of any operator who is achieving a 32.5% profit! We could make bank with those numbers.


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## northernsweeper (Aug 26, 2004)

I know I am not the sharpest tool in the shed, but it doesn't make much sense to me. Instead of getting 1,000 per month for a contract, you get 75.00? Or instead of 10,000 you get 750.00? What is the point? You do all the work to obtain and keep good accounts and thats your share? Sounds like just another national scam. How could you live, or even survive on 7.5%?


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## 32vld (Feb 4, 2011)

Wasn't there a company that sold internet based soft ware for plowing companies that was owned by a national snow removal company, that then used their access to pricing went and low balled those accounts.

When something is to good to be true it is not.

Also who is going to be happy only making $75 profit on each $1000 of sales?


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## Pristine PM ltd (Oct 15, 2005)

Was the company you are talking about ever proven to be doing that? I believe it was some sort of Tracking software for your crews. It seemed suspicious to me, but I never heard that someone actually proved they lowballed the accounts.


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## mike thunder (Oct 19, 2011)

BossPlow2010;1406942 said:


> So they'll pay you if you lose the account? How much will they pay because if you lose it for winter and summer, chances are you won't get it back. Ever. So if it was a 20 year account, the. You just lost out on all that profit, plus they will bad mouth you. A person / company will tell five people you're a good company. But will tell twenty people you're a bad company.
> is this an example, or is a company actually doing this?


Yes. They'll pay the total gross amount for the summer/fall season. You're right, you and they will lose the account for ever, and people could possibly bad mouth both of you. They have no incentive to provide poor service. They stand the chance of losing you as there customer and hurting their reputation with the accounts they are servicing for you. With that said, they stand to lose substantially if they provide poor service.


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## mike thunder (Oct 19, 2011)

Italiano67;1407077 said:


> I am sure they would prefer 25%profit margin. I dont know of too many snow accounts that can pay 25% profit plus the 7.5% to you. That is the problem with this business is somebody new is always supposedly smarter than the next guy. The only thing that happens is the price goes down and everybody loses.


The 25% is total, so your 7.5% comes out of that, leaving 17.5% for them.
I would say they are being responsible with their profit margin (25%). It would be nice if it was 30%, but they are close.


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## mike thunder (Oct 19, 2011)

IMAGE;1407081 said:


> Is this something your thinking of doing?
> 
> What if you lose the account, and it could be for any number of reasons... you could say it's because they are not happy with the snow service, the customer doesnt have to give a reason, and clean hands says it's not their fault. I see a law suit if it's a big enough account. They won't want to pay, and you're screwed.


This can be said about any situation on the planet.


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## mike thunder (Oct 19, 2011)

TCLA;1407324 said:


> How do you retain ownership of your accounts?
> 
> You must first have a contract with the client in order to "sell" it to them, right? Connect the rest of the dots for us.
> 
> Does the client pay you....you take your cut....then you give your "service partner" the rest? If not, how does your "service partner" get paid from your client without executing a new contract with your client?


You never actually lose them. They stay with you, and you allow these guys to service them. 
First both parties sign confidentiality agreements. Once all the legal stuff is out of the way you open up your books to them, and they to you, and the two parties analyze whether or not moving forward is in the best interest for all parties. 
The have a simple marketing plan that makes it clear to your customers whats going on and how it's going to benefit them. 
The logistics and hardware are worked out. Phone routing sytems are put in place.
Receivables plans are put into place. You bill as usual and every month both parties review the books. You keep your 7.5% and they get the remainder.
There's more to it obviously, but in a nutshell.
I find it very similar to what we all do every day, hire subs. Want to perform quality checks? Go ahead. Want to be involved? Go ahead. Want to retain some of your employees? They're hired. Want to leave for hawaii? See you in March.


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## mike thunder (Oct 19, 2011)

northernsweeper;1407393 said:


> I know I am not the sharpest tool in the shed, but it doesn't make much sense to me. Instead of getting 1,000 per month for a contract, you get 75.00? Or instead of 10,000 you get 750.00? What is the point? You do all the work to obtain and keep good accounts and thats your share? Sounds like just another national scam. How could you live, or even survive on 7.5%?


If you are currently running at a 30% margin that $1000 account actually leaves you with $300. Given that, the comparision should be $75.00 versus $300.00.


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## Luther (Oct 31, 2007)

Small reward compared to the risk.

Good luck to you.


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## fci (Sep 7, 2008)

I never believe a sales person. I would have your lawyer read the contract to cover your A$$. And your customers A$$. If this goes bad and your in Hawaii you may come back to nothing but pissed of customers.


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## UpstateServices (Nov 28, 2011)

-$


mike thunder;1407661 said:


> If you are currently running at a 30% margin that $1000 account actually leaves you with $300. Given that, the comparision should be $75.00 versus $300.00.


And $925.00 less in retained cash flow!!!

Cash flow is king as we all know. So when you have the opportunity to acquire a great piece of summer equipment on short notice or Prepay for a discount load of weed control or any other issue you are not going to cover it with 75/1000.

We all know about being responsible with our cash, if not we would be out of business. All i'm saying is I'm a lot happier moving 100k through my account and expensing my costs while taking advantage of volume and other discounts that flow into my summer operations, instead of 5 $1500 payments(7500) and giving away 17.5K to an operation that is one decision away from poaching all my accounts and leaving me F_U_C_KD.


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## UpstateServices (Nov 28, 2011)

UpstateServices;1407694 said:


> -$
> 
> And $925.00 less in retained cash flow!!!
> 
> ...


I don't know about you but that means I would need to consign $600,000.00 worth of snow management work just to cover my household expenses and my kids tuition, and all my equipment is paid for. for the six months Nov-Apr.


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## mike thunder (Oct 19, 2011)

*Post wrap up.*

Ultimately this model is the trend of the future. It's already in place and flourishing across the country. Safeguard Properties, americas largest privately held property management company, uses a very similar business model and creates over a billion dollars a year in revenue. There are over 300 other management companies who use a model close to this as well. In our industry specifically we see it every day being used with great success. All these "national" snow firms use this model. Get a bunch of customers, sub out the work while maintaining very little cost and keep a little for themselves.


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## IMAGE (Oct 21, 2007)

From the sounds of it I would say you are thinking about becoming "Clean Hands". I don't think you are the one thinking about leasing your accounts out, but rather the other way around.


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## Lugnut (Feb 25, 2006)

IMAGE;1407900 said:


> From the sounds of it I would say you are thinking about becoming "Clean Hands". I don't think you are the one thinking about leasing your accounts out, but rather the other way around.


I thought the same thing from the beginning. Obviously he doesnt realize that the majority of people on this board hate the nationals with a passion and here he is in his last post comparing himself to them like its gonna make us all sign up! :laughing:


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## Luther (Oct 31, 2007)

mike thunder;1407633 said:


> The have a simple marketing plan that makes it clear to your customers whats going on and how it's going to benefit them.


Why don't you share your.....er their....approach to my client? How does my client benefit by allowing someone other than their choice to service their site?



mike thunder;1407772 said:


> All these "national" snow firms use this model. *Get a bunch of customers, sub out the work while maintaining very little cost and keep a little for themselves.*


Here you admit the NSP's do not use the approach you're trying to sell here. They actually secure the work first, then seek out service partners to do their work.

In the cases where the NSP does not yet have the work, they will submit numbers gathered from the local pool, throw them out there to see what sticks. Once secured, they then get the sites covered by those they wish to partner up with.

Your plan is different, in that you wish to sell this arraignment to a contractor that has already sold and secured work.

I could be wrong, but I don't think you'll find that many naive contractors out there to make this a viable business for you.


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## Eronningen (Dec 20, 2008)

mike thunder;1406884 said:


> You would get a share (7.5%) for doing nothing but allow them to perform winter services to your customers.
> They get to provide your customers a service for a profit (business 101). Customers they otherwise would not have access to because they don't/won't offer summer services.


So I give up anywhere from 10-50% in profit? I'm assuming I still am responsible for billing also so these guys are nothing but a real high priced sub. I would not open the door to strangers to see my accounts, know how much I charge for them, or let them service them. No way, sounds no good.


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## Eronningen (Dec 20, 2008)

One other thing. I've had many of my customers for over ten years and some for five, etc. I personally know many of them. (My customers) I would be ashamed to do something like this.


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## SullivanSeptic (Nov 30, 2008)

So I would need to hold all the paper on the deal? Meaning, billing and collecing? If so, then 7.5% is way low. Billing, Bidding and all paperwork is what cost a lot in business, especially small business. I am in the process of trying to go completely paperless with both my companies. Once I am paperless, I am looking at a 10% savings. I think doing this deal would be going backwards. Not to mention I would be taking all the risk. I don't care what a contract says, once the crap hits the fan, I will be the one paying for it. I have seen and done it too many times. "There is never a problem, until there is a problem" Then everyone involved just plays dumb and says it wasnt their fault.


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## northernsweeper (Aug 26, 2004)

You say " you open your books to them, they open their books to you, and if it seems profitable to both parties you proceed".. If not then what? They then know your entire client list and what you are charging each client, and what your expenses are. Would you then feel secure with them knowing this information, and having no contract?
They then SUB the work out to someone else at even less money, because now they are going to give you an extra 7.5%. I would want NO part of it. No way, No time, No how.


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## the new boss 92 (Nov 29, 2008)

i would run far the other direction. you have the stuff to service YOUR accounts. you decide to sub them out, possibly loose your ass on everything then your ******. so what i got out of all this is your lazy, you want free money, and you are not taking any ones advise after you asked for it.


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## DuraBird02 (Oct 26, 2011)

So, they show up at your accounts with their lettering and phone numbers on their trucks. So when a neighbor says, "Wow this company does excellent work" they call him instead of you. And your client base never increases, only decreases. This sounds bad...


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## Luther (Oct 31, 2007)

the new boss 92;1408462 said:


> so what i got out of all this is your lazy, you want free money, and you are not taking any ones advise after you asked for it.


We don't know if he's lazy.



mike thunder;1406910 said:


> They are, thats what this is all about. They're getting customers they otherwise would not have access to. They come to us, buy work from us for 7.5%, and provide their service for profit to the customers they bought from us.


He's certainly implying that he's been approached by some outfit with this proposition.

IMAGE is correct. I also think he's fishing and testing the waters. His responses are that of a slappy or rep for this type of arraignment, as opposed to wanting any real advice from anyone to the contrary.


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## cwby_ram (Jan 15, 2011)

I won't judge the OP, but this deal sounds like too many hands in the soup for me. I'd rather keep control of the quality (which is best done with me or my guys servicing), maintain client relations, paperwork and all that. And as was said before, maintain my own cash-flow. Too much risk, and too little reward for me.


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## excav8ter (Oct 7, 2009)

I would not sign up for it. I only do about $30,000 in plowing and blower work in a decent winter. Why would I give up all my work, only to get $2,250.00 to keep for myself to get through the winter? I paid for my truck, my 8'2" VXT and my 14' Ebling....as well as my CTL with a 5' blower. Why wouldn't I want to run it?.....or at least put a good person in it to help me? I must be missing the point.....


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## cwby_ram (Jan 15, 2011)

excav8ter;1409061 said:


> I would not sign up for it. I only do about $30,000 in plowing and blower work in a decent winter. Why would I give up all my work, only to get $2,250.00 to keep for myself to get through the winter? I paid for my truck, my 8'2" VXT and my 14' Ebling....as well as my CTL with a 5' blower. Why wouldn't I want to run it?.....or at least put a good person in it to help me? I must be missing the point.....


That raises a good point. Better to keep our employees working through the winter. We'd get 7.5%. If we're not doing the work, what do they get to survive the winter on?


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## greenworldh2o (Dec 3, 2008)

it makes for interesting debate in this snow less winter!

for someone who is a great salesman, has no winter equipment, it seems like win win. if i had $500k of snow contracts i might think about it...


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## mike thunder (Oct 19, 2011)

TCLA;1408372 said:


> Why don't you share your.....er their....approach to my client? How does my client benefit by allowing someone other than their choice to service their site?
> 
> Here you admit the NSP's do not use the approach you're trying to sell here. They actually secure the work first, then seek out service partners to do their work.
> 
> ...


I haven't dove to deep into their material, but basically it's as simple as saying "tcla's lawn and snow has partnered with billy bob's snow. Our goals are (insert what needs said)". They don't market themselves directly to your client, they help you with the notification aspect.


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## mike thunder (Oct 19, 2011)

TCLA;1408372 said:


> How does my client benefit by allowing someone other than their choice to service their site?
> 
> If that's worth pondering, why do any of us use sub's?


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## mike thunder (Oct 19, 2011)

TCLA;1408372 said:


> Why don't you share your.....er their....approach to my client? How does my client benefit by allowing someone other than their choice to service their site?
> 
> Here you admit the NSP's do not use the approach you're trying to sell here. They actually secure the work first, then seek out service partners to do their work.
> 
> ...


From your angle you are partially correct. From another angle, what i said is 100% accurate if you are the guy with a bunch of customers.


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## gunsworth (Nov 18, 2003)

DuraBird02;1408527 said:


> So, they show up at your accounts with their lettering and phone numbers on their trucks. So when a neighbor says, "Wow this company does excellent work" they call him instead of you. And your client base never increases, only decreases. This sounds bad...


good point there, then after being in the area long enough they will pick up accounts of their own, and take yours with a lower bid down the road.

There is no way they can guarantee the level of service I provide for my customers. I dont get why anyone would consider this, I dont see one good point, 7.5% wont pay for ****


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## Luther (Oct 31, 2007)

mike thunder;1409913 said:


> They don't market themselves directly to your client, they help you with the notification aspect.


Here we go. This kind of resembles an answer to one of the many questions.

So...they'll help me craft and send an e-mail?


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## IMAGE (Oct 21, 2007)

So you've avoided answering so far. I will just ask you outright: ARE YOU "CLEAN HANDS" ??? I have lots of ideas i'd like to reasearch also, but I dont see any benifit in doin in in the '3rd person'. I'm not sure why you won't just admit it.


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## mike thunder (Oct 19, 2011)

SullivanSeptic;1408420 said:


> So I would need to hold all the paper on the deal? Meaning, billing and collecing? If so, then 7.5% is way low. Billing, Bidding and all paperwork is what cost a lot in business, especially small business. I am in the process of trying to go completely paperless with both my companies. Once I am paperless, I am looking at a 10% savings. I think doing this deal would be going backwards. Not to mention I would be taking all the risk. I don't care what a contract says, once the crap hits the fan, I will be the one paying for it. I have seen and done it too many times. "There is never a problem, until there is a problem" Then everyone involved just plays dumb and says it wasnt their fault.


The way I understand it is that it depends upon your comfort level. If you would like it that your customers se very little change, keep control. If you would rather not deal with it, let them do it.


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## mike thunder (Oct 19, 2011)

northernsweeper;1408443 said:


> You say " you open your books to them, they open their books to you, and if it seems profitable to both parties you proceed".. If not then what? They then know your entire client list and what you are charging each client, and what your expenses are. Would you then feel secure with them knowing this information, and having no contract?
> They then SUB the work out to someone else at even less money, because now they are going to give you an extra 7.5%. I would want NO part of it. No way, No time, No how.


There would be a contract in place from the beginning, see the original post.


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## mike thunder (Oct 19, 2011)

the new boss 92;1408462 said:


> i would run far the other direction. you have the stuff to service YOUR accounts. you decide to sub them out, possibly loose your ass on everything then your ******. so what i got out of all this is your lazy, you want free money, and you are not taking any ones advise after you asked for it.


What if you didn't have all the equipment?


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## mike thunder (Oct 19, 2011)

DuraBird02;1408527 said:


> So, they show up at your accounts with their lettering and phone numbers on their trucks. So when a neighbor says, "Wow this company does excellent work" they call him instead of you. And your client base never increases, only decreases. This sounds bad...


This is a very legitimate concern.


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## mike thunder (Oct 19, 2011)

excav8ter;1409061 said:


> I would not sign up for it. I only do about $30,000 in plowing and blower work in a decent winter. Why would I give up all my work, only to get $2,250.00 to keep for myself to get through the winter? I paid for my truck, my 8'2" VXT and my 14' Ebling....as well as my CTL with a 5' blower. Why wouldn't I want to run it?.....or at least put a good person in it to help me? I must be missing the point.....


Your actually just the guy that could benefit from "clean hands" offer.


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## mike thunder (Oct 19, 2011)

cwby_ram;1409081 said:


> That raises a good point. Better to keep our employees working through the winter. We'd get 7.5%. If we're not doing the work, what do they get to survive the winter on?


If you have key personal that you want to keep around they will find a spot for them.


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## mike thunder (Oct 19, 2011)

greenworldh2o;1409132 said:


> it makes for interesting debate in this snow less winter!
> 
> for someone who is a great salesman, has no winter equipment, it seems like win win. if i had $500k of snow contracts i might think about it...


Sure. There are definitely guys out there that would benefit greatly from this arrangment.


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## mike thunder (Oct 19, 2011)

TCLA;1410109 said:


> Here we go. This kind of resembles an answer to one of the many questions.
> 
> So...they'll help me craft and send an e-mail?


If that's what you need.


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## mike thunder (Oct 19, 2011)

IMAGE;1410191 said:


> So you've avoided answering so far. I will just ask you outright: ARE YOU "CLEAN HANDS" ??? I have lots of ideas i'd like to reasearch also, but I dont see any benifit in doin in in the '3rd person'. I'm not sure why you won't just admit it.


Avoided? I've never been asked until now. I've been involved in unique ventures like this in the past, but i'm not "clean hands".


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## Jacobsmovinsnow (Jan 12, 2011)

That wont work around here. Remember your clients are not hiring your equipment. They are not interested if you got a John Deere, Cat or a freaking Fisher plow. You got equipment. But they have a lot of trust in the owner, the service provider, thats the key.. You take your self out of the picture and your gonna lose your business. Seven grand is nothing


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## mike thunder (Oct 19, 2011)

Jacobsmovinsnow;1411154 said:


> That wont work around here. Remember your clients are not hiring your equipment. They are not interested if you got a John Deere, Cat or a freaking Fisher plow. You got equipment. But they have a lot of trust in the owner, the service provider, thats the key.. You take your self out of the picture and your gonna lose your business. Seven grand is nothing


Depends who you are working for. Most large commercial/industrial customers require an equipment list, so they care a little. For the most part i agree with the remainder of what you said, but would change "yourself" to "the person that sold them the work". If it was your gm/sales guy/department head/etc. that sold them the work, they most likely based part of their decision on the trust they have in him/her.


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## greenworldh2o (Dec 3, 2008)

this business model does not work for every contractor in every market. there could be an enviroment where this will work. like i said, contractor with little or no winter equipment that is looking to partner or sub out the winter work for a guaranteed percentage. I think the only problem I have with this is that winter work is 'high profit' and the 7.5% you quote seems to most on this board as 'low profit'. 

But posters have to remember, the sub is taking all the risk...therfore he will get the 'reward'?

Am I wrong?


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## northernsweeper (Aug 26, 2004)

I like the name "clean hands"...it kind of sounds like "no liability". As far as I am concerned, there are more than enough "National" companies based 1000 miles away, with no equipment of their own, trying to take over the local markets. It always means more people getting their share of each dollar, and the guy doing the work getting less. I wish they would all just go away. I refuse to work for them, and let them control or dictate my business. They have gotten way out of hand.


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## DuraBird02 (Oct 26, 2011)

Personally, i like to work. I like to interact with customers and get to know them personally and make them feel comfortable with me. That usually means more $$$ when they need anything done. I don't see how anyone could live off of 7.5%.


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## 32vld (Feb 4, 2011)

He can deny it all he wants but the OP sounds as he's "CLEAN HANDS".

Read his sentence structure.

MIkethunder is writing as a salesman promoting CH and how it's going to help us. His sentence structure does not convey the image of a snow removal business owner being convinced that CH is the best thing since sliced bread for him.

As said before where is the logic to sub out $10,000 - 100,000 of work for $750 - $7,500 kick back.

Earning peanuts on what you invested to build up.

Letting them know your price structure before a deal gets completed so they can under bid you.

As stated here on PS before no complete contracts are difficult to enforce.

CLEAN HANDS can just leak you bid info to their sister company DIRTY HANDS and they then low ball your customers away.

And the best part is they do a crappy job and who does the customer come to complain and blame you not your subcontractor/CH. You get fired.

How good is a guarantee when CH goes out of business after a year or two? Not good.

This business venture is just old scams re-served on a new plate.

Parasites would not be here if there weren't plow owners willing to be greedy low ballers.

Problem is the people go into snow removal on credit and or with their back to the wall desperate for money. No business can survive operating with this model.

With the time it takes to build up accounts trucks and plows should only be bought if you can afford to pay for them without having to use them once.

That means you have a good paying income and or enough money in the bank to spend some of it and not miss it.

This is why nationals are thriving. It takes no money on their part they aren't tying up money in equipment. If plow ops refused to low ball for them they would have to put up the money to buy the equipment or disappear.


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## buckwheat_la (Oct 11, 2009)

I have a arrangement a lot like this with one of my competitors/friends, but there has to be a lot of trust involved. In my arrangement I am the contractor that is doing the work for him, and for the most part we have a great working arrangement, however, this is because we are friends and trust each other a lot. Many of his contracts that have approached me basically saying "lets cut out the middle man......" and tried to get me to bid them directly. I won't because I am a man of my word, also the arrangement we have is that I take a pay discount on my regular hourly rate but I get a check cut whenever I ask for it. 

So for example:
My hourly rate is $75/hour for a skid
I bill my friend at $70/hour

BUT I get paid whenever I ask/submit a invoice, same day.

so I tell anyone that asks me to bid it directly that it is going to be the same price that they are getting billed at right now ($75/hour) and if they wanted a discount they would have to give me the same terms, pay the same day that a bill is submitted. That deters most people/contracts from giving me any grief about it. 

So for the original poster, here is a question, if you don't get paid from one of your clients, are you still on the hook for paying the other contractor? Because if so, your 7.5% profit margin is going to get eaten up really fast covering his 12.5% profit margin, and his 80% operating costs.......just saying.


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## sectlandscaping (Sep 7, 2009)

Well we all know how much people hate the nationals. This seems like a worst deal then they give. At least they find the work themselves then pay you half. Even if you were on the other end paying the national, you would still get half the money. 

The CH way wont even pay taxes. As of this winter I made a easy $18,000 grand and havent touch my plow yet. With profit margins like that. How could you give it away? 

Even a finders fee is 10%.


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## mike thunder (Oct 19, 2011)

buckwheat_la;1412037 said:


> I have a arrangement a lot like this with one of my competitors/friends, but there has to be a lot of trust involved. In my arrangement I am the contractor that is doing the work for him, and for the most part we have a great working arrangement, however, this is because we are friends and trust each other a lot. Many of his contracts that have approached me basically saying "lets cut out the middle man......" and tried to get me to bid them directly. I won't because I am a man of my word, also the arrangement we have is that I take a pay discount on my regular hourly rate but I get a check cut whenever I ask for it.
> 
> So for example:
> My hourly rate is $75/hour for a skid
> ...


I've done something similar to your situation. See my "unique ways you've moved your company forward" post.


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