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Discussion in 'Heavy Equipment & Pavement' started by Gravel Rat, Mar 13, 2010.
you might be surprised at how small of an operation some of us are
Many of the excavation contractors in my area are 1-2 guy operations with two excavators one mini one fullsize etc.
I agree completely with the above. Fly by nighters? Don't have that problem. Established dirt businesses that have been here for many years are tipping over, it will be even worse this year. No one is trying to get into this business here.
I have always tried to rest my fate on doing a better job and charging a little more. Be easier to work with, and give the customer more than what they were planning on. When money was flying around this worked well. Now everything takes a backseat to price. So your customers demand the same level of service, but want your number to be cheaper than their lowest bid. Its a bit of bind. The good thing is your getting the calls based on your reputation for quality work. Whether you chose to drop your shorts, that is your decision, but at least you get the calls.
I think diversification is huge. Where I am at it is very important. The residential market is very cut throat, in fact I have never seen anyone digging foundations for less than a dollar a square foot, but they are now. No money in that. So I try to side step that market and do other things that pay better. That diversification is the name of the game right now.
i hope the mulching will help with that diversification. It has been an awesome tool for us and now I'm diversifying back to dirt work more and more. Eventually, I think I will be at 50%- 50% dirt/trees. I'd like to do 50% trees and mulching, 30% landscaping, and 20% dirt and driveways. Not sure if that is enough diversification. A lot of different jobs fall under "tree work" from land clearing, to difficult creek cleanup to chipping and mulching larger brush piles. When things were hot, trees kept me busy full time. I'd rather not play the bid war game so I am doing some dirt work again and keeping my customers in house so to speak. I think it's better not to introduce them to other contractors if I can do quality dirt work or landscaping.
The mulching will be a big portion of that. This Spring will really mark the begining of some nice mulching projects. I hoping to continue to grow that portion, if this goes well this Spring with the mulching projects, I will have a significant foot into this market. As far as percentages it seems that every year brings a different mix. Whatever it takes to stay busy. Mulching is nice because I can do that without any hired help. I am also wanting to expand the precision grading portion of my business. The large commerical building market has fallen off the cliff, but I really plan on pressing that more, even if its on smaller projects. I really missed the market with this precision grading project, dam that sucks.
I am going to play devils advocate here. I agree with the poster who said atleast they are out trying to work instead of sitting at home and collecting welfare (god only knows that would be easier).. Now i do not landscape or do construction any more, when i left construction last year times were bad the company i was working for who has been around for a long time was bearly making ends meet. (so i know how hard it is for you guys) Here is were im going to play devils advocate, in this economy and this time (until things get better) you have to feed your family. Just about every job out there is cut throat, right now. So what im saying is if you get offered a job for 250 dollars, that you would normally do for 500, i would rather take the 50 bucks you make after expenses at the end of the day than sit around and make nothing. Its sad but true making 50 dollars at the end of the day may not put steak on the table but its something, and imo something is better than nothing. Another thing gravel rat, and im not knocking you. You just bought another truck with montly payments which is fine, however you cant knock the guys who under cut you with a pos truck..... You need to make x amount every month just to pay off your truck payment. Were as they dont have to because they have no payment, and if they do, it may be very little compared to yours. The simple fact of the matter is some people can live on x amount of money were as others need xxx amount of money to make it... My family as i am still young are not rich nor are we poor, we are probably middle, middle class. We do not take vacations, we do not buy new cars every 5 years, we do not own a boat, vacation house, nor do we own camp or camper. That is just throwing away money. With that being said all we need is enough to pay off our morgtage and bills every month and that is it. So what im getting at is since we dont own boats, vacation houses, camps, campers, or brand new cars, we dont have to bring in as much as a family who does buy brand new cars every year, or has a camper or camp. Does those material items make other familys better than ours, in our day and age people seem to think owning a corvette is a status symbol of money, when in reality those people may be strapped to the wall in debt.... Business these days (once again until things get better, which i hope they do soon) will require survival of the fitest (sp) who can have the lowest over head to bid the lowest to get jobs.... That of course is my opinion i know some of you may not agree with me but time will tell...... Btw i may have merged away from the topic a bit but its good discussion none the less....
I gotta say this is my 7th year in biz and I just bought a kubota 121 mini ex. I do quite a few stonewall rebuilds here in NH, stonework in general and the mini ex will revolutionize what I do and how I do it.. I think if you buy one of these things and you have a plan, you have your niche, and a real use for the machine you'll be just fine. If you make a big equipment purchase with no real plan, just hoping that everything will work out that's very risky; there's a big difference between the folks that have worked their way up, paid their dues, have a plan, vs the folks that just jump in and hope for the best and try to give good deals; they may take jobs away from the quality contractors initially but who gets called to fix their mess a few years down the road? It all works out!
Go for it. Eventually you will be posting pics of your mulching fleet. It is like lawn maintenance. Always something to mulch or remulch especially if you have fire country out there.
the logic only works assuming that someone's business is tied to their family's lifestyle or bank account. Personally, I'm incorporated and draw a steady paycheck. My personal family has no debt but a small mortgage. No credit cards, car loans, etc. Business has a little debt but it isn't tied directly to me.
If someone LEGITIMATE can work cheaper, God bless him or her. If that same person works cheaper because he uses shortcuts (no insurance, sales tax permits, etc.,) then I have a problem with that. If that same guy cheats by dumping brush on the side of the road versus disposing of it properly, I have a problem with that. The fly by nights, aka really cheap guys cheat out here. They just do. I was hired 2x last year to clean up the same lot where a roll off contractor dumped 2 loads, 2 months apart. It took a little investigative work but we caught the company. It was a large company that was doing haul-off's off the books. The homeowner had to be in on it because he was paying with cash. He only admitted that the material was his (boxes and fed ex stuff with his name and address) after criminal charges were discussed by the sheriff's dept. He was paying $500 for 24 yd rolloff in a $700 industry. The company took the cash, off the books, and dumped the loads right off the road on a rural lot that was a few miles from the jobsite. That's fly by night activity by a larger company!
We have another issue here that gets me fired up. I hate the fact that contractors and developers can burn. I'd much rather see recycling but not just because I chip and grind. It think it's better though I admit I occasionally burn. Still we have laws that govern burning and contractors routinely ignore them even when cited. The rules are in the chipping and grinding company's favor, that is, it might make it more attractive to recycle brush versus burn it but when the contractors ignore the rules and burn they are cheating. When one of the gravel pits got slow, the owner put out the word that he would accept brush for burning on his land. A big no-no in the eyes of the law and there were contractors lined up during the burn ban looking for a cheap place to dump. That's a bunch of BS and the guy got shut down (I didn't call but one of us old piles smoldered during the burn ban and the winds picked up some embers and started a brush fire!).
What I'm saying is go ahead and work cheaper if you can as long as you aren't cutting customers. Even if things are tight, if a contractor is cutting corners by not working with insurance, then he is not putting his customers first and that is the definition of fly-by-night.
I saw an add for a local guy on kijiji (same idea as craigs list) that i will try to look up. But he was charging $35 an hour for skidsteer services, which included any attachment he had (auger,breaker , power rake ) and free delivery within 100kms (60 miles). I sent a very nice email to him...