Mark Krog is the owner of KCG Management with multiple locations and a corporate office in Schaumburg, Illinois. Snow removal clients are all commercial and the company does business in Illinois, southern Wisconsin and western Indiana. The company has 120 workers during the winter months and has an annual revenue between $3 and $5 million.
Krog’s fleet includes dump trucks, loaders and tractors. Loaders are frequently used on large parking lots.
“We tend to put loaders on a lot of our sites, we just need an operator there on site to be able to hop in and go,” Krog says. “If we have plow trucks that we’re relying on getting there, if the truck gets in an accident, the truck’s down.”
Risk is reduced and clients receive expedited service this way.
“All of our sites are running at the exact same time. Customers are being taken care of simultaneously,” Krog says. “Timing is of an essence in our industry.”
Meanwhile, William Moore, president of Executive Property Maintenance based in Plymouth, Michigan, says he can sell more jobs within an area if he knows he has a piece of equipment ready and an operator to just head out there. The operator will cost more but more work is being done per hour, he says.
In the southeastern Michigan market, Moore says a typical plow driver will command $15 to $17 per hour. A wheel loader driver will command $20 to $25 per hour.
“We’re spending $5 more but his revenue generation per hour is a lot more than $5 per hour,” Moore says. “The initial upfront is higher but your end game, the end result, is efficiency and you’re putting less people out there.”
Krog builds the expense into the bid, but with a clear understanding of what larger equipment will provide.
“We have a budgeted price on each piece of equipment and that’s how it gets blended into the bid,” Krog says. “A $100,000 machine is going to command a little more, but we educate our customer that they’re going to spend a little bit more money but they’re going to get the most efficient service.”
