Wondering how much to charge for your snow removal services or if your pricing is within industry benchmarks?

Here’s what you need to know about industry pricing:

Commercial snow removal contract pricing typically ranges from $50 to $203, with an average of $103. This broad variation depends on factors such as service types, property size, and travel time. 

However, at the end of the day, your pricing should serve two purposes: to cover expenses and generate a profit. 

This article will help you navigate how to develop a pricing structure for your business and evaluate whether existing rates are competitive and sustainable.

What is the average price in a commercial snow removal contract?

According to Angi, the average commercial snow removal contract ranges between $50 and $203. The value of the contract depends on the service type and other factors, for example, the size and length of your driveway. 

Here’s a breakdown of average pricing by service type:

Next, let’s explore key factors affecting service prices so you can set competitive rates tailored to your market and services. 

What factors affect the pricing of commercial snow removal services?

Several factors affect the pricing of commercial snow removal services, including:

1. Service type

How you remove snow directly affects pricing. Will you be pushing it with a plow, blowing the snow away, or de-icing? 

Each method comes with different costs. For instance, using a snow blower will cost more than shoveling because it requires fuel, maintenance, and occasional repair, all of which should be factored into your rates. 

2. Property type and size

Snow removal varies between commercial and residential properties. A job that typically takes an hour at a home might take two to three times longer at a commercial site due to a larger surface area, more complex layouts, or higher service expectations. 

For a residential driveway or sidewalk, shoveling, plowing, or adding salt/sand are great service offerings. But blowing, plowing, or loading deck cleaning will be required for large commercial sites. 

The bottom line is to ensure that your pricing reflects the time, labor, and equipment used on a property.

3. Service frequency

Is your business in an area with heavy snowfall? Then, it’s more likely you’ll have customers who need your services regularly. 

Because of this, you should have flexible pricing rates based on service frequency. You can decide to charge per: 

• Visit: Each time you remove snow 

• Storm: Set a fee for the duration of a single snowfall event. 

• Season: a one-time rate covering all snow events during winter

4. Response time

Do you want to offer an emergency snow removal service? How long after a storm would you be available?

Your response time will affect your pricing. Emergency services, for instance, should have higher rates, as you may have to drop everything for the project.

However, if your response time is a few days after a storm, ensure pricing is within industry benchmarks. 

5. Accessibility

The ease of accessing your job sites should affect your prices. Open and easy-to-navigate spaces may not need special adjustments since you can comfortably use any snow removal method. 

But if the area is tight, uneven, or limits equipment access, you will need that special adjustment, and it will increase your operating costs. Projects in such locations require more manual labor, time, and smaller tools. Your pricing should reflect the extra work your crew will put in to get the job done.

How are commercial snow removal service rates calculated?

To calculate your commercial snow service rates, consider the fixed costs, variable factors, and profit margin targets. 

While there are several formulas contractors use to calculate their rates, there’s no one-size-fits-all.

But there are steps to follow to ensure your pricing is fair, competitive, and profitable:

1. Assess the scope of work to be done

First, visit the site to check its size, distance from your headquarters, and any potential layout complexity, such as slopes, obstacles, or curves. 

Based on your assessment, evaluate what snow removal service best suits the property. Shoveling, plowing, or de-icing? This helps you calculate the amount of time, labor, and equipment required for the job.

2. Estimate time and labor

How many crew members will you need to complete the snow removal project? Labor is one of your most significant ongoing expenses, so you need to be sure about the number. 

You also want to calculate how long the service will take per visit.

Using Aspire to manage operations is a seamless process, as you can rely on previous projects to estimate labor costs. You can create accurate estimates using the margins and markup for labor, subcontractors, and supplies to ensure profitability.

This ensures you’re never stuck when it’s time to send a bid or proposal. Aspire also features a client portal where customers can view estimates and approve them with a digital signature. 

3. Consider equipment and operating costs

Factor the cost of travelling to the job location, such as fuel and vehicle maintenance, into the rate calculation.

Will you need to rent or service equipment? How about the cost of purchasing materials like sand or salt to de-ice?

You need to include them in the project rates. 

4. Add your profit margin

After covering costs, decide on an ideal profit margin for your company. This could range from 20 to 40% depending on the service level, risk involved, and competition. A healthy profit margin helps sustain and grow the business, protecting it against unexpected costs that may arise after contracts have been signed.

Once you’ve gathered all the inputs, plug them into the formula below to get a solid rate for your commercial snow removal services:

(Base Labor Cost + Equipment Cost + Material Cost + Travel Time Cost) × (1 + Desired Profit Margin)

Here’s how you can calculate each component:

• Base labor cost = (Hourly wage x Number of crew members) x Estimated hours per job

• Equipment cost = Fuel + Maintenance + Rental fee per job

• Material cost = Cost of supplies to be used per job, e.g., sand or salt

• Travel time cost = Hourly wage x Total travel time

• Profit margin expressed as a decimal, e.g., 30% margin is 0.30

Now, say you’ve been contacted for a midsize commercial property.

• Base labor cost = ($25 x 2) x 2 hours = $100

• Equipment cost (fuel and rental) = $30

• Material cost (salt) = $20

• Travel time (30 minutes round-trip)= $25 x 0.5 hours = $12.5

• Profit margin: 30% margin = 0.30

Using the formula, you have:

($100+$30+$20+$12.5) x (1+0.30) = $162.5 x 1.30 

= $211.25 

That means you can quote $211.25 for the job per visit. 

How can you price commercial snow removal services?

There are different ways to price commercial snow removal services. Some of the most common ones include:

• Flat fee

• Hourly rate

• Square footage rate

• Custom pricing

Choosing the right model depends on project complexity, property type, frequency, and client expectations. 

Here’s a breakdown of each option to help you better understand and know when to use them: 

1. Flat fee

Here, you charge a fixed amount per visit, event, or the entire winter season. This pricing model is ideal for predictable projects. You know the property and understand client expectations and the snow load. 

You can charge a flat fee if you know how long the job will take, the snowfall levels are consistent, and the property doesn’t change that often, e.g., a walkway. 

Why use it:

• Invoicing is easy

• Helps clients budget

• Allows you to lock in recurring revenue

Cons:

• Profits could drop if snowfall is heavier than expected

• You may run at a loss if the rates don’t have a sufficient buffer

To maximize flat rates, ensure your pricing is based on historical snowfall data in the region and that it covers worst-case scenarios.

2. Hourly rate

A per-hour charge is one of the most common pricing options as it’s relatively easy to calculate. You charge clients for your crew's time on the job (travel time and on-site work). 

To calculate this rate, multiply your hourly rate by the hours needed to complete the job and the number of workers. Then, add material cost, overhead cost, and markup for profit. 

The average hourly rate for snow shoveling and blowing ranges from $25 to $75. 

Use an hourly rate if you’re working in unfamiliar territory or unpredictable conditions, e.g., an icy loading dock.

Why use it:

• Ensures you’re paid for your time

• Protects you financially when working with unknown variables

• Easy to quote when it’s hard to predict how long the job will take

Cons:

• Might make clients hesitant if they think you’re intentionally working slowly

• Doesn’t always translate to repeat work compared to fixed rates

3. Square footage rate

This model lets you charge clients based on the area to be covered in square feet. It’s a good option for extensive commercial facilities where their size could significantly raise the service cost.

To use the square footage rate, ensure you have accurate property measurements so you’re not running at a loss. 

Speaking of property measurements, Aspire’s PropertyIntel lets you measure job sites from aerial photographs and maps. You won’t have to spend more to visit the site physically.

The tool also enables you to create estimates automatically as you measure, so you can send bids and get approval quickly.

Why use it:

• Promotes efficiency as you earn more when you cover more ground

• Easy to increase and justify your rates with clients

Cons:

• Doesn’t account for complexities, such as tight spaces or corners

• Requires adjustments in harsh weather conditions

4. Custom pricing

This is known as tailored or tiered pricing, where you build pricing based on the client’s needs or offer a bundled package. 

It’s a good option for complex commercial sites or projects that require multiple services, such as shoveling, plowing, salting, or post-storm checkups. 

Why use it:

• Typically flexible and client-friendly

• Allows you to upsell or cross-sell higher tickets to clients

• Supports long-term collaboration with customers

Cons:

• Takes a while to build accurate quotes that benefit you and the client

• Requires more manual effort when creating bids, which could lead to errors

Price more accurately with Aspire

Nailing your pricing is crucial in snow removal as it can be the deciding factor in whether a client chooses your service or moves on.

Aspire ensures you price with confidence using built-in job costing and estimation tools. 

With real-time job costing, you get to track costs associated with existing projects, materials, labor, and other overhead expenses against your original estimates. It helps you instantly know if a job is profitable or not. 

If it is profitable, this data forms the foundation for future projects.

Aspire centralizes your cost and pricing data, then automatically factors in those numbers into future bids to ensure accuracy and profitability.  

Book a live demo with Aspire today to see how it can help you price accurately.