How to Price

With the amount of work available and the overwhelming demand for spreading services, there is no reason why you can't be successful in this business. So why do more than 50% of all new snow and ice removal businesses fail? The simple answer is pricing. Many contractors have several different reasons for why they price jobs a certain way. Unfortunately most of these reasons aren't based in logic. Don't be a statistic. Take the time to establish a smart pricing structure.

Most Common Mistakes

Factor Your Costs

To price a job effectively, you must know what it's costing you:

Direct Costs

• Truck
• Equipment
• Materials
• Financing
• Insurance
• Licensing fees

Indirect Costs

• Fuel
• Oil
• Grease
• Repairs
• Preventive maintenance

Overhead

• Rent
• Phone
• Advertising
• Administrative
• Utilities
• Labor

Every successful business prices its goods above and beyond its costs. Why should you be any different?

*The key is to boil all of these costs down to a per- application rate. Materials are easy because they come with a price tag. The rest takes a lot more thought. Remember, the more you use your equipment, the less the per-use cost should be.
Though this doesn't directly relate to pricing, you should always remember to document every job in as detailed a manner as possible and attach a copy to your invoices. Include the date, time of day you applied material, what type of materials were applied, what the conditions were, what the ambient temperature was, wind direction and strength, and so on. The more details, the better.

This not only will help build better relationships with your clients, but better yet, helps reduce your liability. During a lawsuit, everyone involved can be called into the courtroom as the finger of blame continues to search for a final target. Protect yourself with documentation that proves you not only did the job, but did it right for the situation. Also, documenting jobs is a good way to add discipline to your service, encouraging you to take the time to assess conditions before each application.