Now the office manager at the company, he spent the early goings of his 10 years at Sneller worrying about how they were going to handle a strong blizzard. The company is based just 30 miles away from Lake Michigan in Byron Center, Michigan, so when snow events happen, it piles on fast.
But the team could only store around 3,000 tons of salt product at any given time. Offringa says that as Sneller has grown, so has the storage — they’re now up to a 20,000-ton capacity. That’s a game changer, even though Offringa acknowledges many smaller companies might not be able to swing all that storage.
But it’s an important consideration for companies looking to expand the snow segments of their businesses, Offringa says. It’s one of many ways to mitigate the stress of a snow event.
“I don’t watch the train loads come in like I used to,” Offringa says. “I don’t lose sleep – we don’t worry about that anymore.”
The right supplier
At Capital Landscaping in Des Moines, Iowa, Phil Glaser leads a company that nearly doubles its staff size from 32 to 60 over the winter. Ensuring those employees all have product to work with is vital, and that’s why Glaser starts placing his orders in August.
Glaser says one challenge his suppliers have helped him mitigate is that getting bulk is really tricky because Des Moines doesn’t receive any freight other than trains. “If you’re in Omaha, if you’re in Chicago, they get bulk,” Glaser says, “but because we don’t have any other freight, it gets a little problematic on the pricing.”
A typical winter in Des Moines produces roughly 32 inches of snow. Glaser says he’s never run out of product, but he’s seen people start scrambling once a winter season reaches 40 inches or higher. That’s when even he has started to nervously check his supply.
Supply chain issues might complicate ordering excess product this year for many contractors. For both Glaser and Offringa, that hasn’t yet been the case, though they’ve noticed price increases. Glaser says a lack of trucking labor has driven prices all the way to 20% higher from where they were just a few seasons ago.
There’s an easy solution, Glaser says: Show them the money.
“You can mitigate (the price increases) because we pay upfront for it,” Glaser says. “Everybody likes cash up front.”
Offringa says Sneller hasn’t felt the pinch of the supply chain shortages in snow yet, either, as they order all the way in March for their next year’s product. The last two winters have been significantly lighter than usual, so Sneller was able to buy product for cheaper. It’s a fortunate combination of slower winters, excess product that needs cleared from the docks, and a good cash flow at Sneller that allows them to buy so early.
“As we’ve gotten bigger over the years, we’ve been able to buy in larger volume over the summer season. We’re not at the mercies of the marketplace if there’s a bunch of blizzards out east or out west. We’ve been able to weather that and not have to pay top dollar prices,” Offringa says, adding that the team has two or three salt suppliers, so all their eggs are not in one basket. “So, getting your supply locked in early has been very beneficial to us the last four or five years.”
Glaser helps deal with salt supply issues by maintaining good relationships with his supplier. He’s had several out-of-market suppliers call in recent years trying to sell their services to him, but he’s ultimately declined because he’s built a good relationship with his current supplier. In return, they’ve helped Glaser in two significant ways: They store the salt product until Glaser makes room for it, and they call when they notice supply is running low.
“You have to be comfortable with who you’re buying from. We’ve been buying from the same guy,” Glaser says. “You have to build that long-term relationship.”
The right client
Glaser’s recommendation on building a good relationship also extends to the people buying Capital’s services. He says the new accounts they add throughout a season are the ones where they’re already structured to service them; in other words, Glaser prefers high-end clients. They’re not plowing malls or huge medical centers, but rather doing stuff like smaller businesses where they can offer pretreating and snow removal.
So, they’re not just plowing bigger accounts when the snow gets bad. Those clients tend to be finicky, he says, and often look for the lowest-priced bid on an annual basis. And with the price of product rising, it gets harder to pass it on to a customer who’s just looking for the cheapest solution.
“Last year, we noticed before the winter hit, people were calling asking for service because it was too much for them,” Glaser says. “We continue to service our accounts and are very selective about any new accounts.”
Offringa says that Sneller has opted for rock products that his clients prefer over liquid. They tried upselling into pretreatments and using the liquid products, but few clients ultimately found that service desirable because it’s not as effective on an ongoing basis in West Michigan.
“We’ve got that big body of water only 30 miles away,” Offringa says. “We deal with that little thing called lake effect snow.”
Glaser has noticed his clients prefer a few certain types of products they use frequently at Capital: One type of bagged product has a molasses coating that’s more eco-friendly, and then they have a product that melts down when temperatures hit minus 20 degrees. Plus, they have the standard rock salt, which they use plenty of throughout the season as well.
“Before it snows, we do the pretreat sometimes,” Glaser says. “When it’s really cold, we use the rock salt to pretreat.”
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