I'm thinking of starting a motor grader business on the side. I would like to rent out the machine and operate it on weekends. I would keep the machine at my house and have a shop to make my own small repairs. I think a late 90's Caterpiller 140h would be my best option. They seem to be the preferred grader for local construction companies. Is this a profitable business idea? Or is this to much machine ($$) for a one man operation? Also would I have to keep this machine in a shop during the winter months to prevent rust, or leave it out side and paint over rust? thank you
Sounds like a lot of overhead for the potential profitability unless you have the work lined up and have some trusted potential renters and your numbers say its a good idea. I've got a side grading buisiness w/ contracted work and for the volume of work I'm doing (200-300 hrs a year) I have a hard time spending more than 10-20k on a machine (depending on what it is) I know a guy that swears up and down you've gotta run Cat 140's but I'm making the same money with my 10k machines he's making w/ his 40-50 machines (by the hour). If my volume of work was higher and I was looking at it as a full time gig I'd maybe have a different outlook, but as a sideline its been working fine for me.
A good observation.Most weekend jobs are not high payers.The real contractors need a machine when they need it.
I do have some contacts in the construction industry. The contractors can rent the machine any day of the week. Week days they will need their own operator. I'm now thinking that a CAT 120G would be a good option? Any input is appreciated.
or perhaps a 12H? I'm trying to decide on what model to focus on getting.
I'd really focus on the type of work the machines going to be doing and what your potential renters are looking for. These are the factors that should drive a business decision. If you just have 40-80 grand your really wanting to spend and the machines going to be a toy then start hoping in seats and seeing what you like, if its somthing thats got to be self supporting then there are other considerations. If I was looking at a machine for this type of business model I'd probably be looking more at a New CTL/MTL or a backhoe or excavator as theres probably more work out there for those machines as rentals or as a sideline/weekend business. Just my .02 on the idea
Like as been said previous, it all depends on the contractors that you are trying to cater to. Here's my guess.... tell me if I am wrong. Smaller contractors who dont have the need for a full time blade but have the occasional job where it would come in handy? Then these are the ones that you should target. With that said I am guessing that a 12 or even a 120 would be big enough (and cheap enough) as compared to a 140. If it is a bigger project where a 140 or 14 is needed, my guess is that the contractor already has a blade in his(her) inventory.
Also if you dont have the contract work for it lined up, anything in the 'H' series is going to be a LOT of money tied up for just weekend work.
You would be more marketable with a skid steer and grader attachment. Contractors need a blade, they buy one. Weekend gigs don't pay enough to justify $70-80K blade. You could buy an older Deere for $15-20K, probably make more sense to do that. Older 140G's are still fetching $50K+. Unless you had a lot of work lined up, I'd start real lean and see what happens.
You are right. I know people personally who have small contracting companies that don't have a grader, but would need one time to time. They are my most likely customers and they will work weekends. I also know people (former employers) who are contractors with multiple 140H's with operators. I might get some, but little weekend work from them when times get busy mid summer. Also when one of the 140H graders are down. I cant operate the grader on weekdays, but it will be available for rent. I'm starting to think that a 140H would be too much over head of this kind of business. Even a 12H I'm looking at $90k. Maybe a 120G would my best option.
You are right. I know people personally who have small contracting companies that don't have a grader, but would need one time to time. They are my most likely customers and they will work weekends. I also know people (former employers) who are contractors with multiple 140H's with operators. I might get some, but little weekend work from them when times get busy mid summer. Also when one of the 140H graders are down. I cant operate the grader on weekdays, but it will be available for rent. I'm starting to think that a 140H would be too much over head of this kind of business. Even a 12H I'm looking at $90k. Maybe a 120G would my best option.
Buying an older 140G, 12G, or 120G makes a lot more sense than a new pickup. Try to find one around the price of a new pickup or less and try it. If you have the weekends to work you can spend some time cleaning up an older grader that is mechanically sound with decent rubber but is dumpy/rough. And in a year or two if the idea doesn't work, the grader should resale a lot better than that new pickup would of.