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View Full Version : How to get new equipment???????


ON-THE-GREEN LANDSCAPING
09-03-2007, 10:23 PM
I Just got started this year and have bad personal Credit and would like to know how the best way to get equipment with out paying cash up front ....I know about haveing a duns number for business credit and I'm going to get that soon. But will dealers front me equip to buy ???????


I want some Nice commercial mowers Help!!!!!!

leaflandscape
09-03-2007, 11:38 PM
We started with all used stuff, fixed it up nice, and bought the new stuff as we went. Right now we've got a 1975 Bobcat that we plan to replace, probably in two years. We just keep the bugger running and looking good. If you get into new stuff and can't afford it you're screwed.

ON-THE-GREEN LANDSCAPING
09-04-2007, 12:00 AM
Yeah i know that I just want like a good walk behind I have the jobs but it takes me to long with reg mowers

Ramairfreak98ss
09-04-2007, 12:09 PM
well bud, i had shoddy credit up front too, i started this business when i had the least amount of money in my life actually, started small and grow big fast..

I was lucky for commercial stuff though. My mother has an account for Ferris/Simplicity and a handful of other Briggs brands and i pick stuff up when "theY' want me to buy it on 0% offers.. not when i want or need it.. it works

Ive had snow throwers, walk behinds, tractors and both zero turn ferris mowers on it, most times i pay them off much sooner but its nice to swipe the card at 0% or 24 or 36mo a nd off i ride on a new 8k mower or whatever :) Have any fa mily members with some descent credit? My moms wasnt perfect and i have a pretty high limit on it.

green horizons
09-04-2007, 02:57 PM
Buy used. If all you are after is a quality mower, there is nothing wrong with buying used. If you're handy with a wrench you could buy "well used". If not, buy the nicest used unit you can find/ afford. Brand new equipment looks nice on a trailer, but it's no more effecient than lightly used equipment. I've found "used" Z's with only 150hrs on it for nearly $3000 less than new. It's a no-brainer when starting out.

Stillwater
09-04-2007, 05:59 PM
Buy used. If all you are after is a quality mower, there is nothing wrong with buying used. If you're handy with a wrench you could buy "well used". If not, buy the nicest used unit you can find/ afford. Brand new equipment looks nice on a trailer, but it's no more effecient than lightly used equipment. I've found "used" Z's with only 150hrs on it for nearly $3000 less than new. It's a no-brainer when starting out.

This is good advice from green horizons good used equipment makes more money than new avoid debt

Lawnworks
09-04-2007, 06:48 PM
If you can't handle your personal finances... makes me wonder how you will run a successful business. Buy used trucks, equipment, etc and keep money in the bank.

Ramairfreak98ss
09-04-2007, 08:47 PM
If you can't handle your personal finances... makes me wonder how you will run a successful business. Buy used trucks, equipment, etc and keep money in the bank.


Who says he cant handle his own finances? Hes starting out and asked a simple question about an easier way to obtain commercial grade equipment than to walk into say a JD dealer with 9k cash in hand and out he goes with a mid sized ztr... why jump on his back?

Around here, i see tons of guys buy used utter crap.. I for one am always for used, i buy lots of used cars and keep them for a long time. I can fix most things myself as well. Aside from this, ive bought ALL of my equipment brand spanking new... why? Because a ztr for 7k with 0 beatup hours is worth 7k.... The same machine with just 250hrs on it looks like a$$ to begin with or was severely beaten on.. Trust me, in central jersey, i see what these other LCOs do to the equipment, run over curbs, turn on/off full throttle, poor maintenance, never blows them off and has tons of grass build up, never washed, never greased etc.. I wouldnt offer $2k for a machine that was 7k new that came from one of these places, never.

Ive done just fine starting out with all new equipment, and its still very new looking, low hours and will last me tons of years. If its a decision of finance for anything higher than a few %, buy it used... or like me, buy when THEY want to sell you the machines, nothing beats new equipment from Ferris, Simplicity, Exmark or JD for 0% for 2-3 yrs.... I almost bought another tractor this past July from JD because of 0% for 36mo on a 40k machine.. i just couldnt get over the $1,111 monthly payment for 3yrs if nothing was put down... Maybe next year, either way the deals are out there. Dont buy in the spring or mid summer. Buy stuff at the end of season or find out from local dealers when guys trade in equipment at the end... Most Deere dealers have plenty of used stuff for better prices and theyll only take well taken care of stuff back on trades.

Lawnworks
09-04-2007, 09:42 PM
Who says he cant handle his own finances? Hes starting out and asked a simple question about an easier way to obtain commercial grade equipment than to walk into say a JD dealer with 9k cash in hand and out he goes with a mid sized ztr... why jump on his back?

Around here, i see tons of guys buy used utter crap.. I for one am always for used, i buy lots of used cars and keep them for a long time. I can fix most things myself as well. Aside from this, ive bought ALL of my equipment brand spanking new... why? Because a ztr for 7k with 0 beatup hours is worth 7k.... The same machine with just 250hrs on it looks like a$$ to begin with or was severely beaten on.. Trust me, in central jersey, i see what these other LCOs do to the equipment, run over curbs, turn on/off full throttle, poor maintenance, never blows them off and has tons of grass build up, never washed, never greased etc.. I wouldnt offer $2k for a machine that was 7k new that came from one of these places, never.

Ive done just fine starting out with all new equipment, and its still very new looking, low hours and will last me tons of years. If its a decision of finance for anything higher than a few %, buy it used... or like me, buy when THEY want to sell you the machines, nothing beats new equipment from Ferris, Simplicity, Exmark or JD for 0% for 2-3 yrs.... I almost bought another tractor this past July from JD because of 0% for 36mo on a 40k machine.. i just couldnt get over the $1,111 monthly payment for 3yrs if nothing was put down... Maybe next year, either way the deals are out there. Dont buy in the spring or mid summer. Buy stuff at the end of season or find out from local dealers when guys trade in equipment at the end... Most Deere dealers have plenty of used stuff for better prices and theyll only take well taken care of stuff back on trades.


Great advice from a guy who uses his mom's credit! :hammerhead:

paponte
09-05-2007, 08:43 AM
Double DOH!!!! :hammerhead:

What I have learned from being in business is if you can't afford it... don't buy it. A smooth business has equipment that works for the company. Once you start working for your equipment, it's just not fun anymore. Nothing like having equipment sit during slow periods that you are making payments on. If you NEED a piece of equipment, buy what you can afford and make it work. Sure it's nice having new shiny stuff, but it helps build character and makes you feel good when you can afford what you want.

Lawnworks
09-05-2007, 07:18 PM
Double DOH!!!! :hammerhead:

What I have learned from being in business is if you can't afford it... don't buy it. A smooth business has equipment that works for the company. Once you start working for your equipment, it's just not fun anymore. Nothing like having equipment sit during slow periods that you are making payments on. If you NEED a piece of equipment, buy what you can afford and make it work. Sure it's nice having new shiny stuff, but it helps build character and makes you feel good when you can afford what you want.

I agree. I try not to finance anything. I have found GREAT deals on used landscaping equipment. If it sits for a month it doesn't matter... its paid for. All it takes is patience and negotiating skill to land the deals. Well and you actually have to save some of the money you earn. I believe in slow stable growth. Debt sucks.

Fairway Land & Lawn
09-05-2007, 09:23 PM
Sure, no debt is a really nice situation. However, on the opposite side, never using your credit is a bad thing too. Using credit is a good thing. Taking advantage of 0% or very low interest rates are the way to go. For example - I bought a new computer on saturday. $1,200.00 dollars financed at 0% for twelve months. I would rather have the $1,200 in the bank. The financing costs me nothing, so why take the cash from capital ? Debt in good standing, is far better than no debt - no debt = no credit......responsibility........

Lawnworks
09-05-2007, 09:58 PM
Sure, no debt is a really nice situation. However, on the opposite side, never using your credit is a bad thing too. Using credit is a good thing. Taking advantage of 0% or very low interest rates are the way to go. For example - I bought a new computer on saturday. $1,200.00 dollars financed at 0% for twelve months. I would rather have the $1,200 in the bank. The financing costs me nothing, so why take the cash from capital ? Debt in good standing, is far better than no debt - no debt = no credit......responsibility........

I disagree. Not having to use credit, b/c your bank account is loaded is a great thing. Who needs good credit when you already have the money?

Focal Point Landscapes
09-05-2007, 11:31 PM
Lawnworks is right - if you can pay for your stuff up front , it doesn't matter that your credit history is sparse - you don't need a credit rating . And it is a great feeling to have most if not all of your equipment paid for - makes life a lot less worrisome . I realize that lots of people have trouble doing it , but in my opinion its the best way to operate. The original poster would benefit from having a better mower , it would certainly improve his efficiency and ultimately his bottom line . But he offered that his credit was bad , which I think is what Lawnworks was referring to - it is unlikely that he will be able to get a dealer to finance a purchase . Maybe a co-signer or buy it in a relative's name. I would wait until I had cash for a good used mower.

smcunningham
09-05-2007, 11:51 PM
Every mower you see listed below including push mowers were purchased used.....and I would estimate I've gor 3,500.00$ invested in all mowers....
61"tt/52"/48"/36"w/b and a honda and toro.

paponte
09-06-2007, 06:18 AM
Sure, no debt is a really nice situation. However, on the opposite side, never using your credit is a bad thing too. Using credit is a good thing. Taking advantage of 0% or very low interest rates are the way to go. For example - I bought a new computer on saturday. $1,200.00 dollars financed at 0% for twelve months. I would rather have the $1,200 in the bank. The financing costs me nothing, so why take the cash from capital ? Debt in good standing, is far better than no debt - no debt = no credit......responsibility........

Agreed, there is bad debt and good debt. It's all about managing your money. The point that you made, is you have the money in the bank, so your back to my original point. Only thing to watch out for is taking advantage of too many offers, then you find yourself in a hole. It's all about managing your money correctly.

willretire@40
09-06-2007, 07:23 PM
I guess wal mart is debt free along with Donald Trump. The people that are sacred to use credit is the ones that will never make it to more then 100k a year IMO. I never here anyone say dont go to college if you can't pay cash for it but yet they get 100k in debt in about 4 years and then have to work for 10 plus years to pay it all back. Whats the difference people. Atleast with lawn equipment you are making the money back everyday.

Lawnworks
09-06-2007, 07:30 PM
I just don't think using credit is a great idea when you have a history of bad credit. It is kind of a no brainer.

I am not scared to use credit, but I prefer not to... and I did 100k back when I was 18. You don't have to carry debt to be successful.

YardPro
09-06-2007, 08:54 PM
here's a different take on the situation:

do you WANT new equipment just to have new equipment, for the appearance, or bling factor,

OR

do your NEED new equipment because you are so buys you cannot afford any downtime???

if it is the first then is is the same poor decision making that has led you in previous choices that has led to your current bad credit...i would reconsider

if it is the second, then you absolutely should buy new and pay the higher percentage rates... after all, there are your penalties for previous mistakes.... take your medicine and move on.

PlatinumLandCon
09-07-2007, 10:41 PM
You really have to learn what's good debt and what's bad debt. If you've got a steady growing business and have jobs lined up, it might not be a bad idea to take on a bit of debt to pay for a better machine. If you're just starting out, it might bet better to stick with used to get you the steady customers THEN buy new using credit.

I plan on buying a truck in a month or two and paying $8-10k down, $10k loan. I feel this is GOOD debt because it'll be used for plowing and landscaping. I think that within 12 months of buying the truck I'll make $20k directly because I have a truck. That means I can pay off the loan 4 years early and still have money on hand. If I went out and spent, say $35k on a truck now, I leave myself open to getting into a jam with payments if something happens and I wouldn't be able to pay it off in less than a year.

You really need to evaluate all the money a machine will make DIRECTLY BECAUSE OF PURCHASING IT in the next 12 months and if it doesn't come close (i think it should make more) than the cost of the machine, it might leave you open to payment trouble.

ON-THE-GREEN LANDSCAPING
09-10-2007, 12:47 AM
Thanks for the info. I like used equipment. I just wanted to know but it does not matter. I just got a customer and signed them to $10,000 job and got 2,000 up front. I am in day 3 of job and almost done. Job includes stone work, all trees trimmed, all bushes, 8 drains ran out to street, all flowerbeds, sod layed in back 2 small trees relocated. It has been lots of work, but I picked up 4 jobs on the same street looks like about $20,000 + minus expenses. So I do not have time to mow anything right now.

Americal Vet
09-10-2007, 01:34 AM
Thanks for the info. I like used equipment. I just wanted to know but it does not matter. I just got a customer and signed them to $10,000 job and got 2,000 up front. I am in day 3 of job and almost done. Job includes stone work, all trees trimmed, all bushes, 8 drains ran out to street, all flowerbeds, sod layed in back 2 small trees relocated. It has been lots of work, but I picked up 4 jobs on the same street looks like about $20,000 + minus expenses. So I do not have time to mow anything right now.

I wish you the best of luck and continued success in your new venture.:drinkup:

Fairway Land & Lawn
09-10-2007, 01:47 AM
I disagree. Not having to use credit, b/c your bank account is loaded is a great thing. Who needs good credit when you already have the money?

Everyone needs good credit, EVEN IF YOU HAVE THE MONEY!!! There is no reason to deplete your account of 6-10K all at once.... Congrats, you have a loaded bank account......try to keep it that way. Food for thought- Try taking the money that you would spend all at once on a peice of equipment and put it in a money market account. Generally they have a pretty good interest yield. Said interest that is accrued will help make the payment. Why do you think that many large companies are on a net 60 payment schedule. The longer their money hangs around, the more it becomes....Kinda like rabbits....:rolleyes: They get YOUR money to work for them, by making them more money. Think a little deeper, and make YOUR dollar worth more.....Simple bad credit is easy to change.

Lawnworks
09-10-2007, 06:28 AM
Everyone needs good credit, EVEN IF YOU HAVE THE MONEY!!! There is no reason to deplete your account of 6-10K all at once.... Congrats, you have a loaded bank account......try to keep it that way. Food for thought- Try taking the money that you would spend all at once on a peice of equipment and put it in a money market account. Generally they have a pretty good interest yield. Said interest that is accrued will help make the payment. Why do you think that many large companies are on a net 60 payment schedule. The longer their money hangs around, the more it becomes....Kinda like rabbits....:rolleyes: They get YOUR money to work for them, by making them more money. Think a little deeper, and make YOUR dollar worth more.....Simple bad credit is easy to change.

Think a little deeper. Give me a break. How much money will you make on the interest of 10k invested in a money market account while paying off a piece of equipment? After you subtract the loan interest... it can't be more than 2-3%... and then you have to pay taxes on that... so it is virtually nothing. And you don't need good credit if you have cash!

CuttersEdgeks
09-10-2007, 10:44 AM
you still have to have good enough credit to do other things in your life. you have to play both sides of the table. you have to use your credit in order to get big ticket loans (home trucks ect.) but the small stuff can be paid for. pay 8k for a mower put half down and pay the rest over 6 months. if you have no credit it will screw you regardless of how much you have to show. if one of my kids gets sick and ran medical bills up how wuold you pay for it. chances are you would have to refi your house and if you have poor credit its not going to happen.

Fairway Land & Lawn
09-10-2007, 12:49 PM
Think a little deeper. Give me a break. How much money will you make on the interest of 10k invested in a money market account while paying off a piece of equipment? After you subtract the loan interest... it can't be more than 2-3%... and then you have to pay taxes on that... so it is virtually nothing. And you don't need good credit if you have cash!

You are correct that amounts may be small. However, even if it only saves me $10 bucks over the term of the loan then I will take it.

Also, percentages are exponentially increasing. The more money that is there, the more money it will yeild. You are only thinking of just 8k sitting there. What is 5% of 20k? $1,000. What is 5% of 28k? $1,400. So, the more money you have around, the more it will make for you. Just for the record, you may think that I am sitting here making these statements because I am in debt up to my eyeballs. Quite the opposite. I OWN all of my equipment, I OWN my truck. The business now operates debt free. I did pay for my equipment outright when I bought it, and realized that it was a mistake. Everyone will make their own decisions on how to manage THEIR money. All we can do is help them make an educated decision.

PlatinumLandCon
09-10-2007, 03:43 PM
Think a little deeper. Give me a break. How much money will you make on the interest of 10k invested in a money market account while paying off a piece of equipment? After you subtract the loan interest... it can't be more than 2-3%... and then you have to pay taxes on that... so it is virtually nothing. And you don't need good credit if you have cash!

LOL.... think about what you just said.

The idea of investing the money was not necessarily to profit off it, it was to have a loan that can have the payments offset my the investment. At the end of the term, you have no loan, $XXk invested and a free-and-clear piece of equipment.

fitzg2md
09-10-2007, 04:45 PM
fairway - couldnt agree more. Come on guys, the point of any business is to make money. If spending an extra 5k will give you the opportunity to take on alot more work, then its a good idea. You do however need to have a good handle on the cashflow situation of your business.

Lets take buying a new truck for example. Lets say its 20k to make the math easy. If you are offered a 0% loan or the option to pay with cash (you happen to have the money in the bank just waiting), what is the best option. Well, I would argue to finance it. Let say you put it in a simple savings account that has a good return. Like ING..gets about 5.0% per year. Thats an extra 1000 in your pocket the first year. Drag that out to 5 years, and youve made a nice little sum simplly because you were able to use your money. Invest it in a money market and the return may be even better than 5.0%.

Now heres the key...that 20k in the bank is not money that you want to spend freely. It is already accounted for. If you NEED it really bad, then it is there to use, but you should know that you are now getting into trouble. You have spent that money twice (once to buy truck and once for other thing). Bad idea. What would you have done if the 20k wasnt there? Find another option right? So do that instead from the start. Cant look at it as "well, i have 20k in the bank"...you do, but its offset by your liability of the truck.

With a little discipline a 0% loan can be a real good thing. But if you cant afford a new 20k truck who cares what the % rate is! Thats irrelevent.

PlatinumLandCon
09-10-2007, 05:13 PM
ALWAYS take a 0% loan offer. You'll make more money with the money if you don't buy the truck with it, especially if you're not paying interest.

KTO Enterprises
09-10-2007, 05:23 PM
I guess wal mart is debt free along with Donald Trump. The people that are sacred to use credit is the ones that will never make it to more then 100k a year IMO.

Spoken like a true fool. Last time I checked my dad doesnt use credit, buys 20 grand vehicle scanners and other equipment with cash money. Oh yeah and the 200 corvette and 1999 jaguar XK8 were also paid for with cash. He also makes just over 200,000 per year running his auto repair shop with NO EMPLOYEES.

Come on over and I will put some magic words in your ear and show you how to really make money.

fitzg2md
09-10-2007, 05:27 PM
In the end, cash is always king.

Lawnworks
09-10-2007, 07:14 PM
fairway - couldnt agree more. Come on guys, the point of any business is to make money. If spending an extra 5k will give you the opportunity to take on alot more work, then its a good idea. You do however need to have a good handle on the cashflow situation of your business.

Lets take buying a new truck for example. Lets say its 20k to make the math easy. If you are offered a 0% loan or the option to pay with cash (you happen to have the money in the bank just waiting), what is the best option. Well, I would argue to finance it. Let say you put it in a simple savings account that has a good return. Like ING..gets about 5.0% per year. Thats an extra 1000 in your pocket the first year. Drag that out to 5 years, and youve made a nice little sum simplly because you were able to use your money. Invest it in a money market and the return may be even better than 5.0%.

Now heres the key...that 20k in the bank is not money that you want to spend freely. It is already accounted for. If you NEED it really bad, then it is there to use, but you should know that you are now getting into trouble. You have spent that money twice (once to buy truck and once for other thing). Bad idea. What would you have done if the 20k wasnt there? Find another option right? So do that instead from the start. Cant look at it as "well, i have 20k in the bank"...you do, but its offset by your liability of the truck.

With a little discipline a 0% loan can be a real good thing. But if you cant afford a new 20k truck who cares what the % rate is! Thats irrelevent.

I would argue that there is a 0% price and a cash price... the interest is factored into the price of the truck. And hopefully if you are buying a 20k truck w/ cash... you have 100k in the bank. I am not saying credit is a bad thing. I am just saying life w/ out debt is much more enjoyable. I can't wait to have my house paid off in 2.5 years and be completely debt free. It is just a feeling of freedom. Granted I know when you are trying to grow a business it is hard to be debt free.

maintenanceguy
09-10-2007, 07:33 PM
Having credit is good. Being in debt is bad. Being able to get the parts you need at a supplier and pay in 30 days is very convenient. Paying $20,000 for a $10,000 mower because you financed is a waste of money.

The value of equipment depriciates much faster than it's useful life. A mower with 80% of it's life left will likely only cost you 60% of what a new mower would cost. Good used equipment is a smart investment, probably smarter than new.

Lawnworks
09-10-2007, 07:57 PM
Having credit is good. Being in debt is bad. Being able to get the parts you need at a supplier and pay in 30 days is very convenient. Paying $20,000 for a $10,000 mower because you financed is a waste of money.

The value of equipment depriciates much faster than it's useful life. A mower with 80% of it's life left will likely only cost you 60% of what a new mower would cost. Good used equipment is a smart investment, probably smarter than new.

I agree. I run up 7k balance on my credit cards each month... but they get paid each month. I also have credit lines at suppliers.... it is nice but the trick is paying everything off every month.

I also agree w/ you on used equipment. I have found that I can score some great deals w/ the punch line "cash money right now." My deals that I have paid cash for included, '04 Scag 450 hours - $4500, 03 Dingo tx425 400 hours - $5000, 2000 Cat 248 2000 hours - $4500.

I have also find if you pay cash on used equipment and buy it right you can use it virtually for free... selll it for about for you have in it. I actually bought a package deal of mowers and other equipment for $8500 on Labor Day... I sold it on Saturday for $12,500. Quick profit thanks to cash.

fitzg2md
09-10-2007, 08:11 PM
Lawnworks - I totally agree with you about the freedom of living without debt hanging over your head! Its a great feeling! I guess Im kinda speaking more from the perspective of my business and not as much from my personal finances. I know in small businesses it can be hard to seperate the two completely, but I try very hard. I also would have to agree that you can get some great deals by having a stack of cash in your hands!

Starting out from scratch without being able to afford good equiptment is tough...in any business. Your only real option is tighten your belt (alot) and buy something well used, and work really hard. Then upgrade asap. This will also help you to only grow your equiptment if you NEED it. otherwise its just sitting there and depreciating. May need to pass up some good jobs that you are just not properly equipt for, but such is life. The first few years can be the most trying...

(ps - wow, i need to go back to third grade and learn how to spell!;) )