Many snow removal companies find themselves at the beck and call of their customers so they can maintain and keep contracts. Or they find that they are saying “yes” to every customer, no matter the request, and find that they are merely breaking even on their contracts. This is not how you run a business.
It is important that you ensure all of your contracts are profitable, making enough money to cover all of your overhead costs plus a little cushion. If you are barely scraping by with your contracts, it might be time to reconsider some of your contracts and to get a better handle on how you calculate estimates (see our previous post) and how to start saying no. Read on to learn more about how (and why) you should sometimes say no to some customers.
When to Say No to Contracts
You don’t have to do a contract with every customer that comes your way. Some customers prefer to not have a regular snow removal service, but rather want to call as they feel they need you.
If you take one-offs, it can negatively impact your ability to service your client list in a timely manner. Somebody might have to get bumped and it wouldn’t be fair to your regular customers if that happened. Many snow removal companies operate on fixed-price monthly contacts and don’t allow customers who want to have them on call for occasional snow. This is an example of why setting boundaries is key.
How to Set and Manage Boundaries
Set out clear service expectations and policies in writing and have each client read and sign their contract with you. This gives both you and your client something to reference should something come up. You didn’t show up to plow the two inches of snow that fell two nights ago? Remind them that your service contract says you will be there if three inches or more fall.
For example, give yourself a window broad enough to ensure you can cover all of your customers’ snow removal needs by stating something along these lines: We strive to get to your site within 24 hours of snowfall, but we guarantee we will be there within 48 hours. You should also ensure that your minimum amount of snowfall for plowing is also included in your policies.
Have flexibility in your contracts of course. Some customers may request you plow if only two inches fall. You don’t have to set the same terms for each client – just be sure their expectations and yours are well-documented.
Additionally, you will undoubtedly run into random people in neighborhoods asking you to plow snow from the end of their driveway just so they can get out. It is wise to have a policy that helps you to enforce this. If your crew is already running 1.5 hours behind, taking on another small job like this won’t help you or your current clients. Maybe make it a practice to say no or only do it for clients who meet certain criteria (elderly people, those who need to get to a hospital, etc.).
How to Let Customers Go
Sometimes you need to let snow removal customers go. Dropping a snow removal customer is not always easy. You should handle letting a customer go carefully and professionally. Typically a phone call and email or letter in the mail is a good way to handle letting a client go. Asking around to find another snow removal contractor who you trust who might be able to take the dropped client on is also a good step to take before making the cut.
Wondering what to say exactly? Something along these lines is appropriate:
Thank you for allowing __________ to be of service to you for the past 3 years. Due to the increasing cost of doing business (or whatever your reason), we are regretfully no longer able to offer service in your area. We plan to finish out your contract if you wish, but we will not be able to renew it once it ends. We recommend contacting ________ as they service your area. Thank you again for your business and don’t hesitate to reach out if you have any questions.
Saying no to customers may seem like a bad business practice at first, but once you truly calculate the costs of some snow removal jobs, you will realize that your business is better off passing on them.