When you’re growing your business—getting new clients is a huge focus. But not all clients are the same. Their unique snow and ice control needs require different billing practices and different levels of service—all things you need to be able to keep track of to properly service them throughout the winter season. As you add clients to your winter services portfolio, keep the things below in mind to diversify your business.
#1 Diversify your Billing Types—Per Plow vs Flat Winter Fee
There are two main billing contract types to use when you sign up new snow and ice control clients. They are Monthly/Seasonal or Pay-Per-Plow contracts.
- Monthly/Seasonal Contract: The client pays you a flat fee for the winter, regardless of the number of times you visit the property to provide services. This allows you to have a consistent income you can plan on whether you get heavy snowfall or not throughout the season. These contracts can be for the entire season, or be a hybrid that cover 5-7 events with any billable event beyond that converting to Pay-Per-Plow.
- Pay-Per-Plow: The client pays an hourly rate for the services you provide. They only pay when you deliver services. This can be a lucrative contract type in years when there is heavy snow and ice. For this contract type, it is important to understand what your fixed costs are throughout the season and know exactly how many events need to occur in order for you to break even. This will reduce your anxiety throughout the winter season.
The path to profitability is different for each snow and ice control company. But it’s a good rule of thumb to can organize your portfolio so you can cover your basic monthly expenses (overhead) with your monthly accounts and cover your labor costs with your Pay-Per-Plow accounts.
#2 Location & Geography Matters
When you are building your client portfolio, determine how far you are willing to travel to perform services. It’s good to set a radius around your hub and try to attract the types of properties you want to maintain within that circle. The farther you are away from your hub, the more time your crews will spend driving and the longer it will take for them to refill if they need to get more salt or supplies. If you choose to take clients that that are a fair distance from your hub, consider storing equipment on their site so your crews can go directly to the properties needing maintenance. This will make you more efficient and allow you to take on more clients.
Once you land a client, attract the properties that surround them to add efficiency to your business. You can also look at the common routes your crew takes to travel to your current clients. Work to attract the properties on these common routes to fill in billable services.
#3 Understand the Needs of your Clients
Winter weather is unpredictable and not all properties have the same schedule or needs. Understand the schedules and expectations of your commercial and residential clients—for each day of the week. Their schedules might not be the same day to day and therefore require different snow and ice control service levels on a Tuesday compared to a Sunday. Understanding these needs and expectations in advance will allow you to create a route when winter weather is on the way that prioritizes those clients that need service immediately versus those that can wait until later in the day.
For example, a winter storm hitting on a Sunday would make you prioritize a church with 8am services over the local dentist office that doesn’t open until 9am Monday morning. This level of detail will allow you to service your clients so they can safely welcome patrons when their businesses open.
If you choose to have residential clients, make sure you are clear when you will arrive to perform services. Most municipalities give property owners 24 hours to get their driveways and walkways clear of snow. However, their expectations might be that you will have their driveways clear before they leave for work or return home.
#4 Focus on Commercial Accounts
Residential accounts can be beneficial to someone who is starting out in the plowing business, but require a high quantity before becoming profitable. If you want to develop a lucrative snow and ice control business, you should place your focus on securing commercial clients. The margins on services for commercial properties is higher, allowing you the revenue needed to invest in your business and increase your efficiency. Approaching the owner of a business to quote winter services might be more difficult than working with your neighbors, but the payoff is greater as well.
#5 Grow Your Business Through Referrals
Once you have clients that you enjoy working with, ask for referrals. If you understand the needs and expectations of your customers and provide a high level of service, it should be easy for them to refer you to their circle of contacts. Many business owners are involved in local Chamber of Commerce groups and know many of the other local business owners. There’s a validation that comes with a referral that doesn’t translate as easily into a paid advertisement.
You can kick-start the positive word of mouth buzz your business receives by creating a referral program that benefits your current customers:
- Give your clients a discount on their services for every client they refer
- Ask for reviews on your Google Business Page or Facebook Business Page
- Incentivize your clients to leave you a video testimonial with their smart phones
- Ask if you can leave a sign at the properties you maintain, or put promotional flags on your snow guides with your business name and phone number
The best way to get new clients is to provide the highest level of service possible to your current clients. If you are targeted in how you reach out to prospects, you can create a diversified portfolio and then let it work for you through referrals. But realize that your clients are not all the same. And when you embrace those differences and ensure you have a diversified portfolio of clients, you can reduce your anxiety levels in the winter months.