How Much to Charge for Snow Removal

Knowing how much to charge for snow removal is crucial to the success of your business. Price too high, and you might lose clients to competitors. Price too low, and you risk operating at a loss.

This comprehensive guide will help you navigate the complexities of snow removal pricing, ensuring you can build a profitable business while providing excellent value to your clients.

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Understanding Your Costs

Before you can set appropriate prices, you need a clear understanding of your costs. Let's break down the primary expenses you'll encounter:

• Equipment Costs
  • Purchase price or loan payments for plows, snow blowers, and trucks
  • Maintenance and repairs
  • Fuel
• Labor Costs
  • Wages for employees
  • Your own time (don't undervalue this!)
  • Training and certifications
• Materials
  • Salt and other de-icing agents
  • Sand or gravel for traction
• Overhead
  • Insurance (e.g. liability, workers' comp, etc.)
  • Marketing and advertising
  • Office expenses
  • Vehicle registration and licensing
• Emergency Fund
  • Set aside money for unexpected repairs or slow seasons

Once you've calculated these costs, you'll have a better idea of how much you need to charge to break even and generate a profit.

Factors Influencing Pricing

Several factors will influence your pricing structure:

1. Property Characteristics
   • Size: Larger properties require more time and resources
   • Type: Residential vs. commercial (different expectations and liabilities)
   • Complexity: Obstacles, tight spaces, or multiple levels can increase time and difficulty
2. Weather Patterns
   • Average snowfall in your area
   • Frequency of storms
   • Typical snow density (wet, heavy snow takes more effort to remove)
3. Service Level
   • Trigger depth (how much snow accumulates before you start clearing)
   • Response time expectations
   • Thoroughness (e.g. clearing to bare pavement vs. leaving a thin layer)
4. Additional Services
   • De-icing application
   • Snow hauling
   • Roof snow removal
5. Market Factors
   • Local competition
   • Regional economic conditions
   • Urban vs. rural location

Snow Removal Pricing Models

Now that we've covered costs and influencing factors, let's explore different pricing models:

1. Per-Push Pricing

This model involves charging a set fee each time you clear snow from a property. Keep in mind, this can be multiple times during a single event.

Pros:

• Simple for clients to understand
• Can be more profitable during heavy snow seasons

Cons:

• Unpredictable income
• Potential disputes over when service is necessary

Pricing Guide:

• Small residential driveway: $30-$50 per push
• Medium commercial lot: $100-$200 per push
• Large commercial property: $300-$600+ per push

Pro Tips:

• Consider offering volume discounts for multiple properties
• Clearly define what constitutes a "push" (e.g. 2-inch accumulation)

2. Seasonal Contracts

With this approach, you charge a flat fee for the entire snow season. Typically, it's paid out in monthly installments.

Pros:

• Stable, predictable income
• Clients appreciate knowing costs upfront

Cons:

• Risk of losing money during heavy snow seasons (set limits to avoid loss of profits)

Pricing Guide:

• Residential season (typically Nov-Mar): $300-$700
• Small commercial property: $1,000-$3,000
• Large commercial property: $5,000-$15,000+

Pro Tips:

• Use historical snowfall data to inform your snow removal pricing
• Consider including a clause for "excessive" snowfall (set a limits for events, pushes, and inches)

Multi-Seasonal Contracts

A multi-season contract is a longer-term contract, which usually happens in commercial plowing. While it's not common in residential, you could make it work.

This model should include an annual rate increase of AT LEAST 10-15% to account for costs increases and inflation.

For example, travel, labor, and equipment costs have risen by about 19% over the past few years. Always account for these costs in your multi-seasonal contract.

Pros:

• Can cultivate very profitable long-term relationships with clients

Cons:

• Challenging to develop and calculate
• Requires a good history, trust, and rapport with clients

3. Per-Inch Pricing

This method involves setting a base rate for a certain amount of snowfall and charging additional fees for each inch above that threshold.

Much like per-push, this is when you charge per inch that's cleared.

Pros:

• Flexible model that allows you to set the rate per inch
• Closely correlates with the amount of work required
• Can be mutually fair for both your business and the client

Cons:

• Requires precise measurement
• Can be complex for clients to understand
• Involves extensive experience and is challenging to calculate

Pricing Guide:

• Base rate (up to 6 inches): $50-$100
• Each additional inch: $10-$20

Pro Tips:

• Use reliable methods for measuring snowfall
• Consider a cap or different rate for extreme snowfalls

4. Hourly Rates

Charging by the hour is straightforward but less common for residential properties.

Hourly pricing is a simple method, especially for job costing. You'll charge for your time on the job per person. Then, you'll bill every event and push by the hour.

Pros:

• Ensures fair compensation for time spent
• Works well for complex jobs

Cons:

• May incentivize slower work
• Can lead to disputes over time spent

Pricing Guide:

• Basic snow removal: $50-$100 per hour
• Specialized equipment operation: $100-$200 per hour

Pro Tips:

• Be transparent about your time tracking methods
• Consider minimum charges for small jobs

5. Per Event

Charging per event means you charge per event. Which means, even if you push multiple times during the event, you'd still only charge once.

Pros:

• Lucrative for low volume events

Cons:

• Not profitable for heave volume events
• You don't get paid if it doesn't snow

Pricing Strategies for Success

1. Tiered Pricing: Offer different service levels at varying price points. For example:
   • Bronze: Basic snow removal
   • Silver: Snow removal + walkway clearing
   • Gold: Snow removal + walkway clearing + de-icing
2. Early Bird Discounts: Offer discounts for customers who sign up early, helping you secure business before the season starts.
3. Multi-Year Contracts: Provide slight discounts for customers who commit to multi-year contracts, ensuring stable long-term income.
4. Referral Programs: Incentivize current customers to refer new business by offering discounts or credits.
5. Bundled Services: If you offer other seasonal services (e.g., lawn care), create packages that include snow removal at a slight discount.

Setting Your Prices: A Step-by-Step Guide

1. Calculate Your Costs

Use the cost categories outlined earlier to determine your break-even point.

You'll compute job length based on the hours it would take one person, working alone to complete.

This way, you can divide by the number of crew members to get an accurate gauge of how long it will take, real-time, even if the crew size changes.

Plus, easily access your average snow removal times for similar job using the right snow removal software.

With Service Autopilot you can quickly see how clients align with your profit goals. In turn, you don't have to spend hours crunching numbers on a calculator.

2. Research Your Market

Understand what competitors are charging and what customers in your area expect to pay.

The profit you're able to generate largely depends on the level of demand in your area. For this reason, it's important to see what your competitors are charging.

While you shouldn't base your prices on the competition, it's important to be aware of what's going on in your market.

3. Determine Your Desired Profit Margin

Decide on a fair profit margin, typically 50% for the snow removal industry.

Even though profit setting goals vary from business to business, these are the main factors influencing how much profit you can get from your local market:

• How much are clients willing to pay for snow removal?
  • See what competitors are charging to gain a general consensus.
• Are you a good salesperson?
  • How well does your online presence sell for you?
    • Website
    • Google Ads
    • Social media
• What’s the supply and demand in your area?
  • Did they call you right before a snowstorm?
  • Is the only other snow removal business fully booked?

After setting profit goals, remember to incorporate a little wiggle room for errors and unexpected costs.

4. Create Your Base Pricing Structure

Choose a primary pricing model (per-push, seasonal, etc.) and set base rates.

You want to get familiar with the snow averages in your area. This will help you decide which pricing models will generate the most work and profit.

Some pricing models work better with lighter or fewer snow events, and for others, it's the opposite.

As always, remember to complete a winter preparation checklist during pre-season snow visits to:

• Maximize profits
• Minimize liabilities
• Identify potential obstacles
• Ensure no steps are skipped
• Fully evaluate every property each new snow season

Also, keep in mind, you can utilize different pricing models as you deem fit for the job. Usually, it's best to apply different models to different clients to ensure maximum profits no matter the weather.

5. Adjust for Property-Specific Factors

Develop a system for adjusting your base rates based on property characteristics and service level.

When pricing snow removal services, it's crucial to consider the unique characteristics of each property. A one-size-fits-all approach can lead to undercharging for difficult jobs or overpricing simpler ones.

Here's a brief overview on a few property-specific factors you'll want to consider when considering how much to charge for snow removal:

• Property size:
  • Measure the area that needs clearing (driveways, parking lots, sidewalks)
  • Establish a base rate per square foot or square yard
  • Use a sliding scale where the per-unit price decreases for larger areas
• Property type:
  • Residential: Usually smaller, but may have more detailed work (clearing around vehicles, walkways to doors)
  • Commercial: Larger areas, higher liability, may need to be cleared before business hours
  • Industrial: May require heavy equipment, could have hazardous areas
• Surface type:
  • Asphalt: Generally easiest to clear
  • Concrete: Similar to asphalt, but may require more care to avoid scratching
  • Gravel: Requires special equipment or techniques to avoid displacing gravel
  • Pavers or decorative surfaces: Require extra care and possibly hand-clearing
• Terrain and obstacles:
  • Slopes: Increase difficulty and risk
  • Tight spaces: May require smaller equipment or hand-clearing
  • Obstacles: Cars, planters, or other items that need to be worked around
  • Multiple levels: Such as multi-tiered parking lots or properties with both driveways and upper decks
• Accessibility:
  • Distance from your base of operations
  • Ease of access for your equipment
  • Whether you need to clear a path to reach the main clearing area
• Service level requirements:
  • Trigger depth (how much snow accumulates before you start clearing)
  • Response time
  • Thoroughness (clearing to bare pavement vs. leaving a thin layer)
  • Frequency of clearing during ongoing snowfall
• Additional services:
  • De-icing application
  • Snow hauling
  • Roof snow removal
  • Hand shoveling of steps or walkways
• Time of service:
  • Regular business hours
  • Early morning or late night
  • Weekends and holidays

6. Include Clauses for Exceptional Circumstances

Address how you'll handle extreme weather events or other unusual situations, such as:

• Property damage
• Liability limitation
• Contract termination for exceptional circumstances
• Price adjustments for extreme snowfall and material shortages

Remember, while these clauses protect your business, they should be balanced with a commitment to providing excellent service.

Your goal is to create a fair agreement that allows you to maintain a sustainable business while meeting your clients' needs, even in exceptional circumstances.

7. Develop a Clear Contract

Clearly outline your services, expectations, and pricing structure in a professional contract.

These are a few essential elements to include in your contracts:

• Services to be provided
• Terms of the contract
• Pricing and payment terms
• Service provider responsibilities
• Client responsibilities
• Limitation of liability
• Dispute resolution
• Confidentiality
• Modifications

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8. Review and Adjust Annually

Analyze your profitability each year and adjust prices as necessary.

Communication Is Key

Once you know how much to charge for snow removal, it's crucial to communicate this to leads and clients effectively:

• Be transparent about your pricing structure
• Explain the value you provide (reliability, quality equipment, insurance, etc.)
• Use professional proposals and contracts
• Be prepared to explain how you arrived at your prices

Remember, the lowest price doesn't always win. Many clients are willing to pay more for reliable, high-quality service.

Pricing for Commercial Properties and Parking Lots

As you know, commercial properties take more time and materials than residential drives. In turn, you'll need to consider the size difference between a residential driveway and the average parking lot.

However, there's more to it than size:

• Will there be cars parked in the parking lot?
• Will you need a skid steer to push and lift snow?
• Will they demand emergency clearing during a snow event?
  • E.g. hospitals, commercial centers during business hours, etc.

Keep these factors in mind when bidding commercial properties. Remember, it's important not to overextend yourself.

If you don’t have a way to service everyone, you’ll end up skipping and/or juggling properties. Additionally, this will burn out overwork your crew, and anger clients.

Since snow is a demanding business with long work hours, it's important to do you best to remain dependable with consistent high-quality snow removal services.

Plus, clients are likely willing to pay more for these reliable high-quality services.

Automations is the  #1 way to follow up  with clients. If you’re not using it, your business might still be successful - but it won’t grow. 

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In Service Autopilot, our automations send emails and texts to:​

Every lead after an estimate is completed

Clients after their property has been serviced​

Remind leads and clients to send you customer feedback​

Update outdated or declined payment information​

Inform them when a service can’t be completed due to unforeseen circumstances (i.e. weather)​

Remind them of maintenance tips (i.e. putting a cover on the outdoor faucet before the winter)​

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Did you know, the best snow removal software has the power to:

• Track pre-season snow visits
• Quickly view client profitability
• Document before and after pictures
• Automatically track average job times
• Access client account information from anywhere

Service Autopilot is the best way to automate growth and easily launch simplified marketing campaigns.

In addition, with Service Autopilot, you'll gain access to profit-generating resources, such as:

• Smart forms
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• Crew and equipment tracking
• Instant estimate creation on-the-go

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Now You Know: How Much to Charge for Snow Removal

Exploring how much to charge for snow removal doesn't have to be a complex process.

This article has shown you a simplified process of how much to charge for snow removal based on profit. Plus, use this information to help determine how much to increase prices on existing clients.

AS ALWAYS, check in with your trusted CPA (i.e. Certified Public Accountant) before launching any new pricing changes.

Now, you know how much to charge for snow removal to meet profit goals and grow your business today!

Related: How to Easily Increase Snow Removal Prices

Originally published Oct 24, 2017, updated Oct 8, 2024 4:55 PM CT