You can make great money plowing snow, but there are many factors you need to consider before going all-in on the industry. From weather conditions to insurance coverage there are some varying factors that come into play. However, with the right business plan and approach, there is money in the snow removal business.
Due to the seasonal nature of the business, you need to be prepared for revenue only coming in during certain months. Sixty percent of professionals within the snow removal business say that it is less than 30 percent of their annual income. And only four percent are solely in the snow removal business with no additional income. This should be your first question when considering snow plowing for profit. Will you go ‘all-in’ or is this a side business?
Regardless of how you decide to structure your business, these considerations will help you understand how much money you can make in snow removal.
Running a snow removal business can be simple, but does come with expenses. The biggest items you’ll need to consider are equipment, supplies, staff, and any overhead. If you are running the business completely on your own then you don’t need to worry about the last two items.
- The equipment prices may come as a shock at first but think of it as an investment. There are multiple types of plows, plow trucks, skid steers and front loaders you can purchase, but the type of equipment you use will depend on your business model. Assess the equipment you already have (ie. a Bobcat if you do landscaping) and research the parts that you need to complete your fleet. However, once you make the investment into the right, quality equipment it can be a critical piece of making money with snow removal.
- The supply portion of expenses may be done in small increments but can add up over time. Supplies pertain to fuel for your trucks, salt, and any other chemicals. If you’re able to purchase these in bulk or wholesale it can cut down on costs.
- Do you plan on hiring staff? If so, then you need to do your homework on establishing fair wages. In order to be profitable in plowing snow you need to keep your expenses to a minimum, so if extra staff aren’t necessary, don’t overhire.
- Overhead expenses pertain to office space, vehicle maintenance, phone usage, and insurance. These are the things that keep the wheels turning for your business. While you may not need office space, you do need insurance for your equipment. Do the math on these expenses in the upfront to help you better understand your budget.
Finding The Right Market
If you want to make money with snow plowing than you need to target a market that actually needs you. If you’re in an area that has multiple snow plowing businesses, covering both residential and business then you may be barking up the wrong tree. You don’t want to get yourself into financial trouble simply because there are too many competitors out there. Do your best research to understand the market you’re targeting. What competitors already exist? Do they cover both business and residential? Do they offer different types of snow plowing? Try and find a white space that you can own which will differentiate you from the pack. Consider also that residential driveways might be plentiful, but are they profitable?
Pricing Snow Removal Services
The pricing for snow plowing can be difficult because of weather unpredictability. Unfortunately, with the snow plowing business, your hands are tied when it comes to Mother Nature. If you live in an area that without fail always has snow during the winter, then you likely will be profitable. But if you live somewhere that it can snow one winter and not the next, then snow plowing could be a tough business.
You can price your business either based on season rates or per inch of snow. A seasonal rate means you are paid the same amount regardless of snowfall. A per inch rate is simply a price tag per inch of snow that falls. Both have their pros and cons, so based on your geography you’ll need to decide what works best for your business and potential profit.
Subcontracting Snow Removal Services
If you’re nervous about diving headfirst into owning your own snow plowing business, consider subcontracting. Making larger snow removal companies hire subcontractors. This takes away the pressure of going against these larger companies as competition. Reach out to these companies or look at online job sites such as Monster.com for snow removal postings. This route allows you to turn a profit at a much lower risk.
There are many factors you must consider to understand how much money you can make plowing snow. A few numbers to run and questions to ask, but if done thoughtfully then you’ll be best prepared.