LOANS!!!!!!!!!!!!!!!!!!! Spending $$$$$$!!!

Discussion in 'Lawn Mowing' started by eggy, Aug 27, 2000.

  1. eggy

    eggy LawnSite Bronze Member
    Messages: 1,144

    Well just wondering how many of you are operating on a pay cash basis for your equipment...I would find this impossiable to start a sucesfull buisness and do this and even somewhat silly..I think I have realized that in this buisness it is overwhelmed with labors...but hardly no buisness people. Also I would really like to see how many of you are incorporated....thanks!
  2. bob

    bob LawnSite Platinum Member
    from DE
    Messages: 4,262

    On your "incorporated" comment, do a search. We just had this question about 2 weeks ago.

    P.S. I'm not incorporated.
  3. Kent Lawns

    Kent Lawns LawnSite Senior Member
    from Midwest
    Messages: 870

    Why would you pay cash for equipment? (Unless you have surplus $)

    Most dealers/manufacturers have promos for 0% for 6 months or low % financing. Even straight thru leasing companies rates are pretty attractive.

    Use your cash for "non-finacable" items.
  4. dhicks

    dhicks Member
    Messages: 770

    I have paid for all of my equipment with ca$h. I don't like debt and 10-21 percent interest rates. Just a personal preference for my lifestyle and business.
  5. accuratelawn

    accuratelawn LawnSite Senior Member
    Messages: 922

    I am debt free.. Truck ...everthing
    When I started out I took advantage of 6 month no interest and no payment to get going. Bought two mowers this way.
  6. tlcgrounds

    tlcgrounds LawnSite Member
    Messages: 133

    Yes I have to admit there are a lot of laborers and few business men. The diffrence is common sense. A lot of the guys just mow mow mow. If they need mor money they get a bigger machine and another guy and most of the times that doesn't work. to run your business effieciently we need to look at our hourlys what they actually are and not what we like them to be. our costs and find ways to mimize our costs and maximize profits. Every area has a dirrent combination of machines labor force and size of properties and whhat those properties expect from us. from there we need to judge these factors to decide what the delicate balance of work load and equipment are. Then you need to track your progress and adjust your gameplan accordingly.
  7. eggy

    eggy LawnSite Bronze Member
    Messages: 1,144

    Bob I know we talked about this a few weeks ago I was impressed by what little people know about buisness..They can mow grass and this is a great site for those tips..but buisness tips are few....I guess I just seek informnation on the bottom line....How long did it take you guys to see a profit it seems that all we do is by more equipment which is needed.....sales are good..but winter is long here about 4 months ...this kills a just seems after expenses the cash isnt really there....maybe we are paying cash to often and need to get more cash flow ..who knows...
  8. Yardworks

    Yardworks LawnSite Member
    Messages: 141

    Everything I have is paid for except for my JD M653 ztrack. The Ztrack is a 0% interest deal for a year. My motto is whenever you can use someone elses money for free, do it. If I can't use money for free I pay for it. All that saved interest just adds to the profit margin.
  9. jaclawn

    jaclawn LawnSite Senior Member
    Messages: 490

    One problem that I see is that many contractors fear debt. They would rather put up their money to pay for a piece of equipment, than use someone elses for a fee. I really can't balme them, IF, they have the cash to do so.

    Many times, guys will use too much cash to purchase something, then not have adequate working capital to operate off of. This gets a lot of contractors in trouble, they will pay cash for a large purchase, then have to borrow to pay every day operating expenses. Maybe they don't borrow per say, but they may use a credit card, and carry a balance to the next month...

    It is also a good idea to have an extra cash reserve for a rainy day. You never know when you will need your money, so hold on to as much of it as possible.

    BTW- Those same as cash offers can be great, if you can pay them off in time. Check the fine print though, some will stipulate that if you do not have the balance paid in the free period, the interest accrues from the day of purchase, and usually at a higher rate than if you financed it traditionally.

    [Edited by jaclawn on 08-28-2000 at 10:25 AM]
  10. Twotoros

    Twotoros LawnSite Senior Member
    Messages: 494

    If the purchase is under 2 k I pay cash. Over I use a leasing company that bills only six months out of the year i.e. during my working season . Last time was for a 36" snow thrower and I was billed during winter months for two and a half seasons. Works for me.

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