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Summertime dues

  • SIMA
- Posted: November 5, 2017
By Thomas Skernivitz

The world turned upside-down for Karen Shackles, CSP, ASM, not when they paved paradise to put up a parking lot, but rather when they took her parking lots and gave them to someone else.

Parking lot sweeping had for years been a “really good fit” for Alpine Ventures, according to Shackles, the firm’s managing director since 1993. That ended when facilities maintenance companies arrived in Dillon, CO, and assumed control from local store managements. Just like that, the price for a daily service that would last 1.5 to 2 hours fell, Shackles says, to $25 or less.

“We can’t have a guy come in and start the truck for $25. It was ridiculous,” she says. “So, we declined to renew those contracts and sold off our sweeping equipment. That really set us on the path to being snow only.”

Alpine Ventures then gradually reduced its landscape excavating work while simultaneously building its snow customer base until the company - in the middle of the Rocky Mountains, 9,000 feet above sea level - finally hit a balance in which it could focus entirely on snow removal.

“We are the reverse of a lot of companies,” Shackles says. “Where they only have three or four months of snow season, we only have about four months of summer.”

Xtreme Snow Pros, based in Ringwood, NJ, had been a snow and landscape business until its sale in 2006. “We took a few years off and made a decision to open up our snow-only business in 2009,” owner Chris Marino, ASM, says.

Kent Peddie, CSP, the president of Precision Snow Removal, went the snow-only route in Ottawa seven years ago after dedicating much of the previous 18 years to interlocking stone installation and landscaping. The reasoning for the change was three-fold:

“I felt I had managed to accomplish most of the technical challenges in the landscape construction side of the business. There really wasn’t anything out there that we had not done or delved into, and so the excitement was wearing thin,” Peddie says. “The second reason was that when I first started out I mostly hired friends. Over the years, my friends, and their friends, and also friends of friends started dwindling as they moved on to other careers, and I was left getting up each morning and working with people who I didn’t know well and didn’t sync with. So, the jobsite fun and antics were no longer there.

“Lastly, I was learning more and more from people who I met at the SIMA Symposium on becoming a snow-only company, and that concept became a new challenge for me.”

Snow-focused benefits
The best thing about being snow only is the “time to play in the summer,” Shackles says.

Xtreme Snow Pros can now “hyper-focus” on its business model, Marino says. The company spends all year preparing. Snow-specific equipment can be purchased; no longer is there a need to turn a landscape truck into a plow truck. Team members have time to attend SIMA events and partake in education certifications and online webinars. “Our thoughts and processes are well laid out since we have the dedication and time to make sure it’s right since there is no tomorrow in the snow business. We need to get it right the first time,” Marino says.

Snow-only companies have an advantage over other companies in that they can market themselves as “focused snow professionals,” Shackles says.

“We are always ready and waiting” while competitors, Peddie notes, “are still tied up with their other endeavors.”

“Perhaps more importantly, we are able to have all of the processes related to the snow management business up, running and fine-tuned months in advance of the season,” Peddie says. “Our snow-only concentration has also allowed us to talk to our suppliers and other partners well before autumn to secure equipment and negotiate better deals.”

Cons of snow only
On the downside, companies cannot employ workers year-round, so finding quality help is always a challenge. “We are a farming town,” says Eli Sullivan of Sullivan Snow Service, out of Crookston, MN. “When my dad started this business, there was always seasonal help around that wasn’t working in the winter. As times have changed those people are now employed full time for the farmers.”

Cash flow is the biggest issue, according to Peddie. “That challenge is something we struggle with; however, I think we finally are getting a handle on it and (I) am hopeful this will be less of an issue in the next year,” he says. Another challenge is labor related. “We go from three to four regular staff members in mid-October to dozens by late November. That 0-to-60 mph launch causes a lot of stress and doesn’t give us much time to get to know new recruits and to reconnect with our previous team,” Peddie says. “The new team members are not familiar with our business, our processes or our corporate culture.”

Peddie and Marino also cite the possibility of missing out on snow contracts because they cannot offer year-round landscaping and snow plowing services as a challenge. “This doesn’t appear to have been a big problem so far, although it is hard to tell how many property managers passed us by because we were a snow-only company,” Peddie says, adding he is considering getting back into landscape management and grounds maintenance. “We think this might help to keep a core group of staff on year-round who embrace our corporate culture and expand our market to include those that want landscaping and snow services from one provider,” he says.

What if it doesn’t snow?
Alpine Ventures offers only flat season pricing while relying on the law of averages in terms of snowfall, Shackles says. “Fortunately, we live in an area where the fluctuations between ‘below average’ and ‘above average’ are not that extreme, so pricing our work based on an average winter yields the appropriate income,” she says. “We have always maintained a customer retention rate over 95%, so when we get a new customer, we know that most likely they will stay our customer long term. One year we may make a little less profit, one year we may make a little more profit, but over time they pay a fair price and we make a fair profit.”

Marino balances his portfolio with a 50% mix of seasonal and billable contracts. “This year we are looking into introducing snow insurance as another safeguard against a high or low winter,” he adds.

A potentially larger issue is too much snow, Peddie says. “Seasons where we get crazy weather but cannot charge extra because we are just below the threshold can cause problems. This is why you have to have different types of clients or different types of contracts to buffer the risk,” he says.

“I think the key is really knowing and having confidence in your business, knowing what your costs of operations are, looking at the big picture long term, and not panicking over the fluctuations of one season. We’ve been in business for 24 years now, and having that history definitely helps us keep our perspective from one winter to the next,” Shackles says.
State of the Industry 2017



Tom Skernivitz is a veteran trade publication journalist based in Cleveland.
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