Anyone that has a bustling snow removal business can tell what you what it’s like when you’re first starting. As a budding business, all business is good business and that usually means that taking on residential customers isn’t just smart, it’s a necessary step toward bolstering your business.
However, residential accounts will only get you so far. On the contrary—they’re often not even profitable in the long-term. What they do, however, is get your name out there, lend your business credibility, and lay down the essential groundwork for snagging the real bread and butter, which are commercial snow accounts.
Why Commercial Snow Removal Accounts Are Essential
A snow removal business with a foundation made of residential contracts might as well be a hobby or side hustle. It would be great for someone dedicating just a fraction of their time to the business; someone who isn’t afraid to push a shovel or already has a snowblower or plow blade for personal use. Beyond that, a venture consisting of small jobs means small margins—you either spend too much time earning your revenue or cut down on time by investing in equipment and reduce your revenue that way. No matter how you cut it, the time/investment ratio of small-time snow removal is not conducive to sustained profit.
On the other hand, commercial snow plow accounts earn you enough of a profit to invest in better equipment, hire help, and still make money. With enough of these accounts, you’ll soon find an equilibrium that allows you to equally invest in your business (increasing efficiency) while making more and more of a profit. However, it’s one thing to knock on your neighbor’s door to offer your shoveling services. It’s a whole other thing to find businesses willing to invest in your snow removal services. Yet, with a few tried-and-true tips, you can be on your way to earning those lucrative commercial contracts that will soon be the lifeblood of your snow removal business.
Have an Existing Cash Flow as Well as Cash Reserves
One thing many business owners do not realize is that with business contracts you often do not simply get handed a stack of cash every time you plow a parking lot. Rather, you enter into a contract with a business that states the frequency, method, and many other facets regarding the scope of your snow removal. But most of all, your contract should spell out your payment terms.
If possible, try and negotiate Net 30 payment terms. That means that, upon services rendered, your client has a maximum of 30 business days to render payment before they violate your contract. You may also be surprised to find that Net 30 is typically the shortest term negotiated—payment can take even longer than that. With that said, make sure you have some cash flow as well as cash reserves so you’re not champing at the bit for each payment.
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Pound the Pavement
While going “door to door” certainly feels old fashioned in this day and age, it’s still an effective means of getting business in the industry of snow removal. However, don’t bother your neighbors with low-margin, low-profit requests to clear their driveway. Instead, speak directly to the Home Owner Associations in your area as well as the owners/maintenance directors of condominiums in the region. The kind of contracts you want should be large and, the more organized the organization, the more likely they will be to pay well.
Don’t just call these people up—head into the offices and ask the receptionist if you can speak to the person responsible for leading the maintenance and grounds keeping efforts of the establishment. From there, try and score a meeting and be prepared to sell your services well—bring in testimonials, have your accounting ready, and dazzle them with your professionalism and tenacity.
Fake it ‘til You Make it
The adage, “fake it ’til you make it” has a lot of truth to it. Success is often not easy nor is it instantaneous. Often our attitude and our persistence are all we have to show for ourselves. With that in mind, it’s best to bring that philosophy into your client acquisition efforts.
Build a professional website, have a business card with your company logo. Heck, print out some t-shirts, hats, or other memorabilia that you can give away to prospective clients. Most of all, appear organized and professional when you meet with a client. Dress how you think they’d dress. If your future meeting seems like a casual lunch, then wear your company shirt. And when the opportunity calls for it, don’t be afraid to dress to impress.
Lay it All On the Table
Come into a client meeting with the beginning of a plan already in the making. Show them real figures, like the effects of snow removal on condominium tenancy or the increase in seasonal sales from businesses with sustained snow removal.
The truth is, snow removal makes everyone happier, whether they’re renters at a rental community or customers looking for a place to shop in the middle of winter. If you can tell a story, and make your services an important part of it, then you’ll be convincing clients to hire you in no time.
Most of all, listen to your clients. Allow them to show you problem areas so you can come up with a tailored strategy together. Ask them questions, like where they’d want the snow to go after plowing. The more collaborative you are in your pitch, the better your chances of winning a client.
Do Your Research
The best thing you can do, especially when starting, is to simply drive around your city and write down the names of the commercial properties you see. When you have the time, compile this information into a list, find the addresses of these businesses, and if you can, find the owner. With this information, send out an artfully composed introduction to your business as well as a request to bid on their snow removal contract if and when it expires.
The more comprehensive your research, the better chance you have of sticking in that potential client’s mind when it comes time to hire a snow removal company. Send them a removal strategy based on the lay of their land. You could even print out a satellite view of their business with a play-by-play of how you would manage their snow. Cold calling can be unglamorous, but you’d be surprised — sending out your information at the right time could score you a victory that might be exactly what your business needs to reach the next level.