No Snow Winter

In New England, the 2010-11 winter dropped 81 inches of snow, according to the National Weather Service. This year so far it has dropped only 9.1 inches. Last year, snow-removal companies were scrambling. There was not enough equipment or man-hours to keep up with the snow levels. As a result, many landscape contractors spent the off-season loading up on expensive snow removal gear, only to see virtually no snow-removal work in New England this year.

The pitiful snowfall this year has had trickle-down consequences. Among the hardest-hit were snow-removal companies, many of which followed a season of record profits with a season of record losses.

Weather-dependent businesses can be risky in general, but the fact that this winter followed one that was exceptionally snowy created its own set of problems for the snow-removal industry. In addition to the capital outlays, many have found themselves in a losing approach to commercial contracts.

A Lesson For Snow Removal Contractors

The industry works basically two ways: Contractors are either paid a flat fee for the season or paid by the storm or the inch. Last winter, those who were locked into flat-fee contracts with commercial customers lost out due to the excessive hours plowing and removing huge snow piles. After that, many companies decided they wanted to be paid for every inch, only to have gambled the wrong way.

Lesson Learned

?EUR??,,????'??If I?EUR??,,????'???d been smart, I would have done half in winter contracts and half by the inch,?EUR??,,????'????EUR??,,????'??? said Extreme Landscaping?EUR??,,????'???s Jamie Lewis. Lewis works only by the inch, and last year, he said it allowed him to earn three to four times what he might have under a seasonal contract. Not so this year.