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Labor challenge? Consider subs

  • Mike Rorie
- Posted: October 1, 2014
Maintaining a positive reputation in this business is key. Because of the unpredictable nature of snow & ice management, it’s important to be known as a reliable and trustworthy service provider. To achieve this, you can’t overcommit when selling your services. You have to be there on time every time, and get the job done right.

As providers, we have a short window of time to take care of our clients, and when time constraints are combined with the unexpected, you can find yourself under pressure to perform. So, how can you grow your business without overcommitting your resources?

The answer is simple: Use subcontractors.

It’s much easier to grow your snow services with the help of subcontractors. In my experience, most of the disadvantages commonly associated with using subs are not as big of a threat as they’re perceived to be.

My experience
We didn’t begin using subs at GroundMasters until we were about 15 years into the game, which was foolish.

Like many service companies, we were hesitant to subcontract our work because we were worried about risking our brand and reputation. We feared that subs wouldn’t show up or wouldn’t fulfill the job to our standards. We also feared that they would work directly with the client and cut us out.

We got over these fears when we realized that not having enough resources and encountering the unexpected were much bigger problems. Plus, if we hadn’t enlisted the help of subs, we would have had to work a lot harder and spend a lot more money to scale our snow business.

Had we learned to utilize subs earlier, rather than trying to do everything ourselves, we would’ve grown our core business much faster.

When you work with subs you automatically extend your reach with equipment, manpower and likely geography. You also have the opportunity to develop relationships with other contractors, which can lead to new business and business insights. All of this will almost guarantee the opportunity for growth. The initial steps to starting a relationship with subcontractors is no small task, and there’s a large, ongoing administrative component associated with maintaining these relationships, but you may find that it’s worth it.

Ease the process

The goal is to make it easy for subs to work with you. If you can make it easier to do business with your company versus someone else’s, you’re in a good spot and will attract and retain quality subcontractors. The key is to maintain control of the sales and administrative processes, and to remain the point of contact for both the subcontractor and the client.

This means you will be responsible for gathering the property specs, estimating the job, winning the sale, and executing the contract with your client.

A property diagram with parking lots and sidewalks color-coded for service, and any notes, special instructions and expectations for the service are also a must. Review this with the sub and make sure they have a copy so everyone is on the same page when it’s time to service the property.

Be sure to execute a subcontractor agreement that outlines expectations, billing, payment terms, etc. In addition, you must have proof of insurance from the subcontracting company before work commences, and ensure their policy fulfills the client’s service requirements.

Communication is key

The true test of how well your relationship with any given sub is going to work is how an actual snow event goes. If the sub isn’t going to fulfill your expectations and complete the job, discuss that with them early.

It’s also a good idea to frequently communicate with your subs during an event. With software and text messaging at your fingertips, this should be easy. At the bare minimum, require a message from your subs that the site is clear and the work has been performed, whether it’s via text, phone call or software confirmation.

Here comes the fun part (and more administrative burden) - it’s time for everyone to get paid.

Get your invoices from subs and suppliers ASAP, so you can quickly submit invoices to the client. Billing fast eliminates the risk of your customers forgetting about an event (or its severity) and decreases their desire to negotiate you down. You will then get paid faster and can more quickly pay your subs.

We would often pay subs the day following an event, because we felt it was our responsibility to get the payment from the customer and not make the sub wait. We were popular with subs because of this, and after we established our subcontracting system we never had trouble finding reliable subs.

Recruit from other industries

We could always find subcontracting companies through trade associations and contractors in other industries. Excavating, roofing and hardscape companies stuck with us year after year because we had work and were easy to work with.

Simply putting the word out that you’re looking for seasonal labor is the main thing. Tell your employees, friends, suppliers, neighbors, anyone you think might have a connection to someone seeking extra income, to spread the word. Placing a newspaper ad or posting a flyer at the grocery store are easy, affordable ways to recruit folks.

It’s capital intensive to scale these businesses, but working with subs eliminates having to invest in equipment, labor and insurance liability. Work hard at maintaining those relationships with your subs because it pays off. If you can win the work, then win the workforce, you win it all. 
Mike Rorie founded, grew and eventually sold GroundMasters, a Cincinnati-based commercial grounds maintenance provider. He is now CEO of GIS Dynamics, parent company to Go iLawn and Go iPave.
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