Chicken Little may be the most famous weather extremist to date, but today’s snow-and-ice contractors are smart to keep an eye on not only the immediate forecast, but also long-term trends. This season’s back-to-back-to-back storms that hit the East Coast surely raised some eyebrows, but was this a dramatic climate shift or just the cyclical nature of weather?
Lee Trachtman, director of business development for Global Industrial Services, based in Apalachin, N.Y., has plenty of experience looking at advance weather models.
“I know there has been a lot of talk of climate change and its effects on winter storms,” Trachtman says. “I had a weather insurance business prior to my current role and from what I have seen, I believe this is just the cyclical nature of weather. If you research weather history you will see these types of events occurring in years past.”
When the weatherman warns of a possible “super event” in the days ahead, Global Industrial Services is blessed to have a wealth of reserves in place to alleviate any panic.
“As a large self-performer with extensive resources across the Northeast U.S., we are fortunate to have additional resources that we can move and reposition to help assist with large events,” Trachtman says. “At each of our over two dozen service locations, we have an emergency plan in place that lists multiple crews that will travel to our other service areas on short notice to assist. This plan goes into effect typically 48 hours before a sizable storm.”
And when in the throes of the battle, communication is paramount.
“The key during any large event is to make sure you are communicating all aspects of the storm with both your crews and your clients,” Trachtman says. “It is imperative to have a plan beforehand that you share with everyone so everyone knows what to expect. This can be modified during the event but it is key to set expectations to help reduce storm-related issues and complaints.”
Frankie Ippolito of Boston’s Ippolito Snow Services, concedes the possibility of a climate shift, though it does not affect his focus.
“I am sure there are some climate-related shifts in the works, however I am not sure if we will ever really know what caused what and when,” Ippolito says. “But what I do know is we have to be ready to deal with these types of events because clients expect us to.”
And when the extreme is predicted, procedures are in place at Ippolito Snow Services.
“Anytime there is a major event, including those now termed ‘super events,’ we do plan a bit differently,” Ippolito says. “We immediately begin to secure more equipment and resources, and make sure we have back-up equipment ready to deploy in the event of break-downs.
“We’ve had to come to grips with renting equipment just to have if there is a problem, and sometimes paying for it and never using it,” he added. “It’s a cost of doing business and providing clients peace of mind.”
Once in the fight, sticking to the game plan is S.O.P.
“We just run the playbook and stay the course, constantly monitoring for anything that could be coming off the rails,” Ippolito says. “It’s hard in the moment, but trying to really be thinking about what’s next helps you stay proactive.”
Matthew Burgio, executive secretary at Matthew & Tony General Landscaping in Westchester County, N.Y., says the increase in super events may be both a climate shift and the cyclical nature of weather, with jet stream patterns changing from year to year. That said, they approach each storm “relaxed and confident” because they plan for the worst-case scenario.
Wayne Michalak, president of The Greener Side in Inkster, Mich., concedes that he’s not a climate expert, but believes this trend is merely cyclical.
“I can remember as a kid getting some pretty large storms,” he says. "We haven’t had these in a long time. Not to say there might be something larger going on in the big picture with the temperature/averages.”
His company’s clientele requires planning differently when the forecast calls for a “super event.” “We service zero-tolerance type accounts,” Michalak says. “During major events, many of our sites are better than the roads. We build up auxiliary labor and equipment. We will run shifts instead of going ‘straight through’ as we might with a normal type of event. We will look at materials and decide if they will be effective given the rate and duration of the snow event. We will develop an initial strategy as to how best to perform the work that needs to be done while keeping our team safe and our customers happy. We will communicate the plan with customers and team members.”
Once in the fight, you’ll likely find Michalak calm and smiling. “The moments leading up to the event are usually more stressful than the actual event happening,” he says. “We are professionals. We know how to get it done. There will be issues as there always are. We have contingencies. Sometimes with the bigger events, customers are a little more understanding.”
Considering a season with multiple “super events” is just as likely as a standard, nondescript winter … or even a no-snow season … contract wording is very important. Burgio says getting that right comes with experience.
“Snow removal has to be priced correctly,” he says. “You cannot afford to underbid, so you have to account for ‘super events.’”
Michalak has built-in language in his contracts that kicks in for major storms. Language based upon an if/then scenario – if X inches of snow in a season/event, then cost increases – exists, but could lead to a slippery slope.
“The majority of our work is per push/per application so we have inch charges and other language that covers us for massive events,” Michalak says. “On the seasonal side, we have a cap, but honestly, that is an area when we grow, we will have to work on, in my opinion.
“Most snow contractors that have been in the business for more than 6-10 years will have this [language], having been through the cycle once or twice,” he says, adding: “We have an issue asking a seasonal contract to pay more at the conclusion of the season. I’m always worried about the other side of the equation.”
The competitive tone of the business at the scale of Global Industrial Services forces Trachtman to take a different approach in contract bids and proposals.
“In a perfect world you would like to have a blizzard clause in every snow contract that gives you the ability to charge more for larger events,” he says. “Unfortunately, given the nature of the large national RFPs and bids that we participate in, that is not always possible.
“With that being the case, we use our ability to provide built-in emergency services as a selling tool and as a way to differentiate our company with some of the other large national or regional players,” Trachtman adds. “We feel that if we are not going to be able to charge more for the big events, we make sure our clients are aware of the additional resources that we might provide. Hopefully it translates into improved and timely services and our clients recognize it and we can grow our business with them.”
Creative language can be utilized in the event of extremes, Trachtman says.
“There are many ways to structure a snow contract, including a floor and ceiling, in a seasonal contract that accounts for both high and low snowfall,” he explains. “These contracts help to reduce one side feeling like they ‘lost’ during any one snow season. These can be a bit more difficult to implement with large multi-site contracts and are typically utilized for one-off type locations.”
While Ippolito wouldn’t change his pricing model, Mother Nature’s unpgredictably underscores the need for a diversified service offering, – seasonal based, multi-year, or event based accounts; or the mix of total inch caps and floors.
The French have a term to describe going beyond “super events,” Ippolito says. “There are modifiers to contract language that can escalate the price if you go over X inches, and others that offer a credit back to clients if under X inches, and those can be useful in some instances,” he said. “I’ve also seen some very strong clauses around force majeure (superior forces) events to protect the contractor if we have the ‘super-duper cyclone storm of the century’ and despite the best efforts and additional resources it’s near impossible to keep a lot operational.”
Spanish philosopher George Santayana is noted as saying, ”those who cannot learn from history are doomed to repeat it." Each storm is unique, but each can aid in how the next is handled.
“We have to be balanced about [planning],” Ippolito says. “It’s never a guarantee, so we have to work on processes that have certain levers we can pull that help us to scale up when needed. We’ll get better in each planning cycle, I wouldn’t rush it all at once and overburden the P&L, there is a happy medium and we can incrementally build it into the run rates.”
When it comes to “super events,” you don’t always know what you don’t know. “Large events are always great learning experiences,” Trachtman says. “The one thing you realize is that you cannot effectively anticipate everything. There will always be things that can and will go wrong. You use those experiences to help teach and train your staff and hopefully avoid similar issues again.”
When discussing young contractors looking at getting into the snow-and-ice-removal industry, Burgio stresses the importance of how other people view them.
“First and foremost, make sure they don’t sell themselves short,” he says. “Under-charging on contracts can lead to a poor reputation. After all, your reputation is all you have when starting out.” He also offered a few things to consider:
- Always prepare for the worst-case scenario;
- Stock spare parts for the usual suspect break downs;
- Stay on good terms with other contractors in your local area.
“You never know if they are going to need your help or you find yourselves in a situation where you’re in need of help,” Burgio says. “Always remember, your greatness comes from lending others a helping hand.
“Don’t lose focus and don’t assume you’re the man … stay humble no matter how great you become,” he adds. “The snow industry across the United States finally has a voice with, ASCA and SIMA. With our voices now being heard, it’s imperative that young and old contractors work together to maintain reputable companies.”
For Ippolito, some of the most important time comes after the event. “I know it is tough when you are in total react mode, and the only focus is getting the work done for clients, as it should be,” he says. “But once you are done, and have gotten some rest, I find it really important to get your key folks together to understand what worked and what didn’t work. Don’t try to solve it all by the next storm, pick your battles and typically ones you know you can win in short order. It feels [better] to win a few small battles than to be defeated in a large war.
“Lastly, communication is key and I have found that it has to be someone’s job to make sure your communication to clients and employees is happening regularly – people love consistency,” he adds. “If you think, ‘I’ll call everyone’ or ‘I’ll e-mail them out a status,’ there is always something that will be pulling you away … and communications goes to the bottom of the list.”