What is a going rate for an acre?

[ted putnam]

I pay 12-$1400 a month for all that on me and a part time guy. I make a decent living but by the time I pay for all my material, payroll, truck payment, equipment payments, insurance and all the other overhead there's not much left over at the end of the year. I only pay myself a couple thousand more a year than I made at the FD. If I can't at least do that, I need to find another job. What I am trying to say is everyones situation is different for different reasons. I think it's great that all your stuff is paid for. One of these days it will have to be replaced and it's going to cost you more than what you live life on right now without those payments. If you are saving for those future replacement costs, you're covered. If not....

[rcreech]

Originally Posted by ted putnam

I pay 12-$1400 a month for all that on me and a part time guy. I make a decent living but by the time I pay for all my material, payroll, truck payment, equipment payments, insurance and all the other overhead there's not much left over at the end of the year. I only pay myself a couple thousand more a year than I made at the FD. If I can't at least do that, I need to find another job. What I am trying to say is everyones situation is different for different reasons. I think it's great that all your stuff is paid for. One of these days it will have to be replaced and it's going to cost you more than what you live life on right now without those payments. If you are saving for those future replacement costs, you're covered. If not....

It comes down to this!!!!!

It isn't what you charge for a service.....it is what you net at the end of the day!

It sounds like you charge more, but your costs are a lot higher. And that is why I said earlier to just know your costs and make a profit.

I am a sole prop!

From what you are saying....I think it is safe to say that a smaller guy has a lot of advantages over a bigger business!

As far as replacing equipment....you are correct! Yes equipment has to be replaced, but if you take care of what you have that will have to be done what....every 5-10 years?

I think it is best to upgrade as you go!

[humble1]

Originally Posted by rcreech

It comes down to this!!!!!

It isn't what you charge for a service.....it is what you net at the end of the day!

It sounds like you charge more, but your costs are a lot higher. And that is why I said earlier to just know your costs and make a profit.

I am a sole prop!

From what you are saying....I think it is safe to say that a smaller guy has a lot of advantages over a bigger business! When I pull off an acre, other then some minor equip cost and fuel I know I have netted about $70-80 in about 35-40 minutes.

As far as replacing equipment....you are correct! Yes equipment has to be replaced, but if you take care of what you have that will have to be done what....every 5-10 years?

Trucks, spray tanks, seeders, spreaders all last 10-15 years or more if taken care of. I think it is best to upgrade as you go!

I am sure the cost of living is different but I am wondering the difference in fert prices based on where you live. Are most of the FErt production done where there is an abundance in farming? If so it would mean that the guys that work closer to the production areas would pay less than someone far away. I think everything is relevant to what your cost to live is, i have heard stories of a gallon of milk costing over $8 gallon in Hawaii

[advanced irrigation]

is $637.50 an acre for weed control high?

[rcreech]

Originally Posted by humble1

I am sure the cost of living is different but I am wondering the difference in fert prices based on where you live. Are most of the FErt production done where there is an abundance in farming? If so it would mean that the guys that work closer to the production areas would pay less than someone far away. I think everything is relevant to what your cost to live is, i have heard stories of a gallon of milk costing over $8 gallon in Hawaii

Very well said!

I was out in IL this week and they raise 250 Bu corn, and we here in OH usually raise about 140-180 Bu corn! That means they GROSS about 50% more then I do.

You would think that these farmers would make much more then use here in OH, BUT their costs are 2-3 times higher then ours!

They HAVE to raise 250 Bu corn to make a good profit, where I can raise 150 Bu corn and make more money per acre then them!

It is just like this in lawncare! This week was a BIG eye opener for me as I guess I don't get out much!

[ted putnam]

Hey Rodney,

I hope you didn't take my comments the wrong way. I wasn't trying to irritate you. I was just pointing out evryones situation as being different. I just S Corp'd a little over a year ago. Before that I was like you. I had to do it. Taxes were killing me. Self employment tax is 15% of everything. If you incorporate it's 15% of net profit. Big Difference. I want to cry every month on the 15th when I write those checks. I used to be able to stick most of that back in the bank. I will be interested to see just how much it's helped me this year. Everyone needs eye openers occasionally. I've had my share on here. It's good to see what others across the country are doing and how they run things. Networking with others. It helps keep you on your toes. makes you more competitive with the local adversaries.

[ted putnam]

Originally Posted by advanced irrigation

is $637.50 an acre for weed control high?

Just a little!!!!!!!

[rcreech]

Originally Posted by ted putnam

Hey Rodney,

I hope you didn't take my comments the wrong way. I wasn't trying to irritate you. I was just pointing out evryones situation as being different. I just S Corp'd a little over a year ago. Before that I was like you. I had to do it. Taxes were killing me. Self employment tax is 15% of everything. If you incorporate it's 15% of net profit. Big Difference. I want to cry every month on the 15th when I write those checks. I used to be able to stick most of that back in the bank. I will be interested to see just how much it's helped me this year. Everyone needs eye openers occasionally. I've had my share on here. It's good to see what others across the country are doing and how they run things. Networking with others. It helps keep you on your toes. makes you more competitive with the local adversaries.

Heck no, not at all!

We just all do things differently, and as you said it is neat to discuss them as we all have plenty of room to learn!

[turf hokie]

[QUOTE=rcreech;2096212]Worse case....if you pay $18.00 a bag for fert (which is very high) and and it costs you $15 an acre for broadleaf control (which is very high), your cost is $64.00 an acre plus fuel and equipment etc.

If you are charging 160-180 an acre and your cost is 64 (which is on the very high side) you are still making over 100 per app.QUOTE]

Using your material numbers b/c I assume they are close for everyone. And the way prices are going these prices may not be very high for long.
Fert w dimension $18 covers 12,500 3.4 bags per A = $63
broadleaf weed $15 per A =$15
labor per A (based on 1A per hour avg w/tax etc) =$25
Total per A =$103
You also have to assume over 8% tax on all materials as NY does not exempt these purchases anymore. They closed the "for resale" ability and dont consider what we do "reselling" anymore.

I am an S corp w/ 2 full time applicators and a part time secretery. But even if you a sole operator you need to pay yourself as an employee and them figure your profit on top of that. So you really in a sense get to double dip.

As an owner of an S corp and not always in the field my salary goes to overhead along with the office staff.

Put in my warehouse, phones, cell phones, insurance, fuel, utilities, equipment payments, DEC & county licensing etc....well you get the picture

Around here you can not park a commercial vehicle at your house. A parking spot goes for $100 - $200 per month depending on location. IF you can find property to buy that is zoned commercial it will cost you over 1 mill per acre with NO buildings on it.

Now you undestand why it might look like 160 per A is great but around here it has to be our minimum.

[rcreech]

[QUOTE=turf hokie;2096830]

Originally Posted by rcreech

Worse case....if you pay $18.00 a bag for fert (which is very high) and and it costs you $15 an acre for broadleaf control (which is very high), your cost is $64.00 an acre plus fuel and equipment etc.

If you are charging 160-180 an acre and your cost is 64 (which is on the very high side) you are still making over 100 per app.QUOTE]

Originally Posted by rcreech

Using your material numbers b/c I assume they are close for everyone. And the way prices are going these prices may not be very high for long.
Fert w dimension $18 covers 12,500 3.4 bags per A = $63
broadleaf weed $15 per A =$15
labor per A (based on 1A per hour avg w/tax etc) =$25
Total per A =$103
You also have to assume over 8% tax on all materials as NY does not exempt these purchases anymore. They closed the "for resale" ability and dont consider what we do "reselling" anymore.

I am an S corp w/ 2 full time applicators and a part time secretery. But even if you a sole operator you need to pay yourself as an employee and them figure your profit on top of that. So you really in a sense get to double dip.

As an owner of an S corp and not always in the field my salary goes to overhead along with the office staff.

Put in my warehouse, phones, cell phones, insurance, fuel, utilities, equipment payments, DEC & county licensing etc....well you get the picture

Around here you can not park a commercial vehicle at your house. A parking spot goes for $100 - $200 per month depending on location. IF you can find property to buy that is zoned commercial it will cost you over 1 mill per acre with NO buildings on it.

Now you undestand why it might look like 160 per A is great but around here it has to be our minimum.

Makes total sense to me! Just like we have been talking about! All of our costs are different. I now see that none of us should be making comments about other prices on here! I always assume that most of our costs are the same!

If you ran your business here you would be RICH or out of business and if I ran my business in NY I wouldn't last a couple months (that is, if we didn't change)! Isn't that funny how different it all is!

It is still good and fun to talk about as we can all learn what each other has to deal with, but again I don't think we can every compare prices!

I always heard that your chem and fert costs much more up North! My material cost/ac is about $46-50/acre so that is why I can charge less! Running larger acres most of the day allows me to get by charging less also. There are just so many variables!