Your equipment will have a significant influence on your snow and ice sales. From the types of work you win, to the number of sites you can complete in a shift, right through to what you’re charging for your services, your equipment will play a strong hand in the work you win this winter.
You could argue that your equipment is just as effective as a great salesperson. How? Let’s take a look at a couple of realistic examples.
Let’s start with an example of two snow + ice companies bidding on the same property. The property we’re about to bid is 2.25 acres of accessible asphalt. It’s of average difficulty with no particular tight spots or challenges. For the purposes of a explaining a simple example, we’re not including salting. Just bidding the plowing.
The Right Equipment for More Competitive Pricing
Acme Maintenance does mostly maintenance work. They don’t own any larger equipment, but they do have a fleet of trucks and plows. Using a plow truck with an 8’ blade, Acme comes up with an estimated time of 2.80 hours to plow the lot in an average event. Their estimate (super-simplified for this example) looks something like this:
| Plow Truck & Driver | 2.8 HRS |
| Cost Per Push | $126 |
| Overhead | $68 |
| Price Per Push | $260 |
| Estimated Pushes Per Season | 20 |
| Seasonal Price | $5200.00 |
Zappa Landscaping is also bidding on this same lot. They own some backhoe loaders for their operations. Using their backhoe with a 14’ blade, they get better productivity, but are also spending more on both the equipment and the operator. So, their equipment and labor costs are higher, but so too is their productivity. Using the exact same overhead and net profit margin as Acme, Zappa Landscaping’s bid is much lower as a result of the improved productivity:
| Backhoe Loader & Operator | 1.5 HRS |
| Cost Per Push | $95 |
| Overhead | $68 |
| Price Per Push | $163 |
| Estimated Pushes Per Season | 20 |
| Seasonal Price | $3260.00 |
Even if Zappa recovered more overhead and/or profit on their bid (if their costs are higher, they would likely recover more overhead), they still have thousands of dollars of wiggle room before they’re competing with Acme’s price.
There’s almost no scenario that Acme could compete, and win, this job when bidding against Zappa. And Zappa’s not giving away their work for free either – they just found the most productive equipment for the job.
Now you might argue that Acme has the trucks – so that if that job did require salting, they might have the upper hand. Maybe. Let’s look at how equipment can affect salting operations in our next example.
*As always, the numbers in this article are intended to project realistic examples, but are not intended as actual costs/savings for any one specific company. Be sure to run scenarios with your own costs/revenue and time saved estimates.
