I've noticed for sometime here that alot of the members are self employed, owner operators. I myslef am one. I use this forum alot for seeing what works for others, and seeing if I can implement that into what I do. Now I haven't been in business for myself long and I'm pleased at how my business is growing, This is my 3rd year doing it, 2nd full time. With every year being better than the year before, For instance right now, I've made 2,500 more than I did last year up until the end of June. When does a business plateau? Once I hit year 5 - 7? I know at some point I will have a year where I make less than the previous one. Next, what percentage of your total income are you spending for newer, better, bigger, or different equipment. Last year I invested 42% of my total back into the biz, in the form of trucks, trailers, and equipment. I expect that at some point my equipment needs will level off, at least thats what I hope. Last but not least, Last year I bought and updated trucks & trailers to where I have a nice and dependable combo. A 88' ford 800 diesel dump, 78k on it, & a 88' eager beaver 9 ton tripple axle that has just been completely re-done. Equipment wise I have a takeuchi tb53 w/ 330 hrs. on it. Coupler, thumb, cab... nice unit & a 79' deere 450c trackloader with 7k hours, some wear, but a fresh motor. What I need right now is a grading machine. Alot of the areas I have been work have been rural, 80% of driveways are gravel, alot of log roads as well that need maintenance, and a large source of rock fill comes from the shale quarries in the area, that stuff has sharp edges and needs tracked in to be graded. Here is the thing, I'm split between two machines. A deere 550 or 650g, forestry package, and a takeuchi tl140 or 150. If I get the ctl, I'll need to keep the 450 because of the winch and the steel tracks, don't use it much, bet when i need it I need it, If I get the dozer, the 450 will go. This lessens the amount of cash that i need to free up, and get rid of a machine that I don't use very much. So which one would you get?
Do you have any one that works for you?
I have help occasionally but 90% of the work I do myself. I subbed some dozer work out last year, and a friend had a ctl that I used several times, but he has since sold it. Could have bought it, but it was a bobcat t190, I hate foot controls, and its a little small for dirt work.
I hated the foot controls at first don't mind them to much now, but still prefer the hand controls.
There´s no set time span for when a business will plateau....that is, if it plateaus. You already know many of the outside variables that effect profit. One of the variables you have to examine is yourself. Once you´re making a comfortable living, how much extra stress are you willing to take on in order to bring profits to the next level?:cool2 As for what machine to buy, I can´t tell you which one is right for you. Do you subscribe to the 'lean & mean' method or the 'whoever dies with the most toys wins' philosophy? Things to consider are which machine costs more per hour to run (not just in fuel, but in UC parts that are wearing)? Do you want another machine to maintain? You mention that you put a lot of time and money into upgrading your equipment to the point where it´s sound and reliable. Will you get your investment back if you sell? Would you be willing to go through the same repairs on another machine if you decided later that you needed another 450? I hope that helps. I´m sorry that all I´ve got is questions. I had a bag of answers somewhere....I´ll go check out in the garage under my box of bar codes.
The business doesn't have to plateau. What you have to decide is how much stress you want to put up with. Do you want to babysit a large number of employees or do you want to stay small? How much room does your company have to grow? A small specialized company can put just as much money in your pocket as a large one. Some people thrive on stress and like managing a large business. Others don't. Some people, like me, just can't decide. I have owned a logging company with 12 employees and 600,000.00 worth of equipment. I have also owned a single grader that I ran myself on one large maintenance contract. Now I have two Bobcats with a pile of attachments, a gravel truck and a bunch of other junk with two part time employees. I keep threatening to sell out and go to work for somebody else but then again, there's this other business I would like to try. Once again, more questions than answers.
In addition to being a teacher, I have been in the manufacturing and construction business for the past 23 years. Like BDFT, I have worked by myself, had employees, worked for others, and for the past 15 years have taught school AND worked by myself occasionally employing a couple of retired guys part time. What these guys are saying rings true with me as well - over time you will determine what level of stress you are comfortable with, and how much supervision you want to do. My current status works well for me. I have a steady source of income with a pension attached to it; I still do some work myself; and I have the capability to take on larger jobs with the option of hiring guys who have the same experience and capabilities as myself and can function with or without me. The bottom line is - it may take time and trying different senarios to find what works for you. Good luck John
Well I have a 1995 hitachi ex300lc-3, 1995 D3C, 2004 cat 216B, 2009 Bobcat 337 and I own them all clear. Got the dozer and the high hoe at the same time brand new in 98 but they were the starting point do to the amount of subdevisions that went in around here now that work slowed down last year so I went and bought the mini and the skid steer and own them free and evern tho my high hoe and dozer are old they are very well maintained amd I can justify buy new high hoes and dozers but I'm at a comfortable point in life where I don't need more equipment but now I need to get dump trucks and a low boy to instead of subing out that work. You need to look at the shape of your machinry and say will this due for another year or another factor is are the jobs your taking on getting larger scale. Ie 1-2 acre clearing last year and this year your doing 5-10 acres or 1500 yard ponds and now 3000yd ponds. But it depends on what kind of jobs are in your area big or small and how many people are expanding bigger it might be better to stay smaller your business might never peak if you have good prices when my company started it was making about $50k-$70k and 13 years later I'm making 250k-325k a year with out any payments so it all profit after repairs and fuel and mantaince but questiong is can you do that kind of work with out lossing your mind. It gets pretty crazy at time most of my money is made with the high hoe on big jobs where its digging like 75-90 basements a month on one job and they only pay like 500 dug and back fill sometimes less but that's only 4 months of the year the rest is ponds and developing and site serviceing and what not but its stressful and I hope this helps you I think I got a little off topic but my point was is a need to up size when it going good now. Why runin a good thing you know I wouldn't change a thing
you sound a little like me GCC ,got out of the US MARINE CORPS in 98 and started with a 72 model gmc dump gas job a homeade three axle trailer a 77 580c backhoe and 69 jd 350 dozer worked on septics mostly on weekends while working as a auto mech through the week then got the idea to sell topsoil run and add and sold 30000.00 in 99 taking a load almost every night after work bought an 89 international dump with an L10 got hooked up with a water and sewer installer as a site truck worked 4 10's in 2000 for them at 45 an hr had fri and sat to do my other work sold the harley and bought an 1845 c for 10k with a new trailer for 5k borrowed 36k for a 450B dozer and a 580L in 01 then it just took off had a drought that year and will never forget working 71 days straight . We now have a ford 9000 dump sk160exc cx31Bexc pc75uu-2exc 236Bskid 580L 2-d4cxl,s and its all paid off what a great feeling now days our income is about 30%septic work 30%foundation/utilities/drivewaywork and 30% misc like ponds/landclearingand small sub division installation