So you decided that you want to add snow and ice removal services to your green industry business. Now that it’s in the middle of summer, you know that you need to start connecting with potential clients, writing up bids and checking to make sure that you have the right equipment to get the job done.
According to SIMA, there are four major elements to drawing up a good bid. Your proposal should cover your overhead, meet the customer’s expectations as well as bring in a profit for you.
Photo Credit: Bobcat of Hamilton
The Four Parts to a Bid
Drawing up a bid is a time-consuming process. By getting started in midsummer, you’ll be able to answer your clients’ questions, as well as you’ll also feel more organized.
Here are those four factors:
Know your cash-flow: You need to look at your financial statements from the past few years to make sure you have enough money to push snow this year. Knowing how your business is doing helps you to compare the costs of the past as well as to help you plan for the future—both during the upcoming winter season as well as five to 10 years down the line.
You also need to know how much it costs to plow and de-ice your client’s lots.
For example, you need to review how much it costs to run/use your trucks, snow equipment, as well as itemizing the cost of your trucks (loans, repairs, etc.). You also need to factor in other expenses in your bid, such as employees, insurance, and other overhead.
Know your time and the client’s lot size: Next, you need to determine the amount of time it’ll take to run your trucks, snow equipment and employees to push snow on this property.
Plus, you need to measure the lot that you’re bidding on—to calculate the square footage of it as well as learn the lot’s layout.
Know the minimum and maximum snow events in your region over the past three years: Find the data and record the minimum and maximum amounts of snow and ice storms your area receives each year. Why?
If it’s a low or high snow season, you need to calculate how many jobs you need to make a profit.
Photo Credit: Suburban Maintenance Services LLC
SIMA recommends that you work with averages and add the following:
Look over the past three years
Break the years into normal, medium and heavy snow seasons.
Once you’ve established your cash flow, the time you’ll spend plowing your customer’s lot and what it takes to make a profit in a low and high snow season; you’re ready to put a price together to present to your customer.
Know your customer: Once you have your bid finished, make an appointment to present your proposal to your potential client. Just because the property manager or homeowner showed initial interest, doesn’t mean that they’re the right customer for you.
It’s better to present your quote in person rather than just emailing it. A face-to-face meeting helps to explain your bid as well as answer any questions.