So far, this winter has been looking up for most snow contractors. I’m in southern Ohio, and in December we had almost five times our normal average of 2.5 inches. This brought a great start to the season and a nice finish to 2013, which most contractors in my region haven’t experienced in a few years.
With the snow still falling, there are a few key aspects contractors can evaluate now to make sure they’re on track and are making the most out of the bounty Mother Nature is delivering this season.
How is your current book of business performing? With a couple storms under your belt, you should have enough information to understand what you’re paying to complete the work.
- Take a look at your direct costs, which have to do with the work you and your staff accomplish. How much gross margin do you see? Are you happy with the results?
- If applicable, look at your subcontractor costs. As a percentage of your revenue, what are your subcontractor costs? Is this what you budgeted? Is it higher or lower than past years? Is the number of subs you’re using larger, smaller or about the same as previous years? Are you using the number of subs you wanted to and planned for?
Answering these questions will help you understand where you are now, and help you make informed decisions when you set out to win new work and renew existing work.
Once you’ve analyzed these two large areas, you should have a good overall idea about how the business is performing financially. Whether you’re happy with the results or disappointed, you need to know why. Your indirect and direct costs make up your cost structure, so if you’re not pleased, drill down further until you discover where the trouble lies.
What kind of feedback are your customers giving you? What’s going on with the clients you’ve serviced so far? Check in with your managers and your customers. Are your clients happy, mad or quiet? How long did it take for them to receive invoices for services? Did they contest any charges?
Something that worked well for my company was to include a recap of the weather events and how we managed them with their invoices. It helped our customers interpret the charges and reduced a lot of calls. Plus, it educated the property managers we worked with and helped us work with them to determine the right amount of service, especially as budgets got tight toward season’s end.
How are your employees doing with the demanding season? Never overlook the disruptive nature that a long snow season has on your team. It’s not an 8-5 task to deliver timely service, and your staff makes the difference during these hectic events. I always tried to show my appreciation to my staff during the snow season, and a large part of that involved listening to their experiences and opinions about how operations were running. Find out what the toughest part of delivering the services is for them. Listen carefully, and then try to give them the tools they need to make delivering services easier and less burdensome for them. I discovered over the years that making things easier for our staff was generally pretty simple and worth the expense if added labor or equipment was desired.
Your staff is the link to your company’s performance, and it’s important to make sure they’re happy. Share the wealth when the business is doing well. Make sure everyone is fairly compensated for their time and contribution to the delivery of services. It doesn’t take much to be fair and show your appreciation for their efforts and the long hours they’ve put in to help the company accomplish the job.
Plan for your future
Are you attending the SIMA Symposium in June? With a better winter than we’ve seen in some years, you have a great reason and no excuse not to attend the SIMA Symposium. Take your key managers and look for the edge to grow and improve your business for the next season. Industry conferences provide the best return on your time. It’s all there: networking, education, manufacturers and suppliers all in one spot for four days of value. I’ve attended these conferences my entire career and always walk away with tremendous value. I hope to see you there.
- It’s been a long winter. Make sure you take the time to express your gratitude to your employees for making the season a success.
- Check in with your customers and your managers to gain feedback on the season.
Mike Rorie has been a participant in the snow & ice industry for over three decades. He is now a supplier to the industry as the CEO of GIS Dynamics, parent company to Go iLawn and Go iPave.