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i need some advise on owning an excavation company

Discussion in 'Heavy Equipment' started by jethro bodeen, Dec 11, 2008.

  1. jethro bodeen

    jethro bodeen Junior Member
    Messages: 4

    I am 18 and i would like to start a small excavation company.
    i have had serveral hours behind the controls of a case 580c that my dad owns.
    i like the kind of work but im unsure of how to go about starting up
  2. KCLawnTamer

    KCLawnTamer Member
    from Kansas
    Messages: 53

    I would suggest working for someone with a established buisness and get lots of seat time on all the equipment you can... Start trying to find some equipment to do side work... Talk to builders and find out who is doing their basements and see if you can contact them... When the housing market was up I would back fill the foundations and do finall grade for them and then either hydroseed or sod the property.. I would start small and do good work... The rest will come...
  3. LoneCowboy

    LoneCowboy PlowSite.com Addict
    Messages: 1,760

    the word is advice, not advise.

    They are both correctly spelled, but you are using the wrong one.

    That's my advice.
  4. illiniplower

    illiniplower Member
    Messages: 70

    I worked for my father-in-law farming and doing excavation. When I went out on my owm I started doing what KC did. Its a good way to start small and work your way up. You will find that you will be told the same thing over and over and thats get plenty of seat time and all types of equipment to help better your chances of getting a job.
  5. csx5197

    csx5197 Senior Member
    Messages: 209

    Do you have any business classes under you belt? Owning your own business it's helpful to have some business background so you can understand how to run it legally. I'd agree though with KCLawn, try to get some experience first. Have you thought about applying to your local construction compaines, town, or state departments? That would get you ample time to make sure you know how to operate and repair your stuff.
  6. tuney443

    tuney443 PlowSite.com Addict
    Messages: 1,847

    I started at 21 years old 34 years ago--yeah,I'm an old fart.So listen up to an old fart---I started with a POS old Allis Chalmers hoe,you can start with your Dad's Case if he'll let you.Just run that,advertising for septic work,water and sewer hookups--get friendly with some small mom and pop plumbers,by keeping your overhead low you stand a better chance of surviving probable slow start up times--hopefully you'll get a good reputation.Treat EVERYONE the way you would want to be treated even if you know they're an A-hole---the customer is always right attitude.When and/or if you get ahead financially,get some more iron if it's justified.Bid jobs with the attitude that there is no shame in not being the low bidder all the time.If you feel you can't make what you need to on a job,don't do it.$1,000,000 X 0 is still $0. Good luck.
  7. BIGBEN2004

    BIGBEN2004 Member
    Messages: 86

    Are you sure it is what you want to do? The reason I ask is because in the dirt world you either have the ability to run machines greatly or you will never get the true ability. I can say that for now the economy is at it's worst level in a long time and that it is not recommended to start any business wright now but if you have a huge desire to try well then go for it. I would just recommend to work for someone for at least 5 years and get some mileage under your belt before venturing out on your own.

    Also if you do start up you need insurance and I would recommend doing a business under a LLC to keep anyone from trying to get everything of yours should they sue you witch happens allot these days since it is a easy way out for many to get money.
  8. JohnnyRoyale

    JohnnyRoyale 2000 Club Member
    Messages: 2,935

    I dont advise you to get into the dirt business.
  9. big pusher

    big pusher Senior Member
    from ohio
    Messages: 129

    I TOTALLY agree with Johnny. Now is not the time to be in this business.
  10. Bajak

    Bajak Senior Member
    Messages: 999

    "If a guy never broke anything, it's because he never did anything."

    That's what I was used to hearing growing up in the industry. I started running heavy equipment when I was 15 and broke a few things due to inexperience, at first, and was thankful that my employer could have the money or resources to fix it. I think you should get about 6000hrs in the seat before you strike it out on your own.

    I find the hardest thing is the quoting or bidding process. A homeowner always wants to know how much up front. They don't care about hourly rates. I used to work primarily for a company that was only subbed out by the hour for larger companies. So the learning curve of quoting jobs took me a while and will continue to be a learning curve as the market changes constantly.

    The highest bid is what the job is actually worth, the lowest bid just gets the job done.

    People skills, Estimating skills, then Operating skills in that order seems to be what all
    of the successful people I know in the small construction/excavating business have. If I was 18 I would practice developing those skills for a while yet.
  11. stauffer.80

    stauffer.80 Junior Member
    Messages: 20

    If you do get started, stick with the small jobs until you feel comfortable doing the bigger ones. I know people always tell me that job is too small, or there is no money to be made there. However, I don't think that is true. I have done many small 1-3hr jobs, and made well over the standard $75/hr and haul time almost every time. All you need to do is set a minimum for coming out, and bid with that in mind. I don't like to charge for excavation by the hour because when you are efficient at what you do with your machines, you don't have any incentive to get done any faster. Also, it is much easier to get small jobs, and there are more out there. I would recommend being open to anything that comes by. Some of the easiest stuff is the best money if you know how to do it and don't close the door on opportunities. Think outside the standard.
  12. tuney443

    tuney443 PlowSite.com Addict
    Messages: 1,847

    ''The highest bid is what the job is actually worth, the lowest bid just gets the job done.''

    Now you know this by any means is not always true.Someone who either doesn't know correctly how to do a take-off on a job or a contractor who bids high because he knows there's vague descriptions in the plans and he wants to protect his caboose disputes that.As far as the low bid is concerned,that's what every contractor wishes for,as long as he{or she} figured correctly.A better term is the lowest responsible bidder---I just wish everyone had that philosophy.I for one have NOT been the low bidder on thousands of jobs just to get the job done.I have always gone beyond the scope of the plans/proposal.That's how you get a good reputation.
  13. elite1msmith

    elite1msmith 2000 Club Member
    from chicago
    Messages: 2,762

    im not exactly in the dirt business, but my neihbor at my industrial shop was.... he ended up switching to just sewer/water - anyway , heres what i know , I AM NO EXPERT AT ALL...but

    first to do th ejob , last to get paid .... inotherwords, on alot of projects...your the first guy in , but dont see a check til the first draw, which could be when the building is under a roof..... 3 months sometimes.. or more he had to wait for his money

    you need a BIG savings account as a result..the line of work your going into , is VERY expensive..... it costs thounds of dollars just to put a liecense plate on his trailer........ 100,000 machines are very common - and thats just the starting point

    the dirt business is nothing to fool with , you really need connections..... lets say you have to dig, remove, haul , and back fill with good soil..... while your paying all that money .... the guy down the street has friends... that want his dug soil.....and are willing to haul it for him... and he has good black dirt , from a friend that has too much , so he gets that at a good price

    what happens when your machine goes down? rental fees are high..... our trucks go down and it sucks.... but 5,000 will buy me a very reliable nice back up truck...... a very nice reliable back up - back hoe, is 25-30,000

    CDL? do you have a truck and trailer that can pull it? you will get away with a skid steer, maybe a small backhoe.. but at some point quickly will need really big expensive toys , and its not like you can easy your was into it.... once you go so big ....then you need semi truck , semi trailer - big boy tools to do repairs, and the list goes on

    as i understand it , excavating , can be broken down into 2 or 3 basic types..... new construction , that requires digging , the abblity to read blue prints , and bigg toys

    tear down , which again requirs big toys, and hualing fees

    or underground, sewer water, - you can lay pipe, and you dont need the big boy tools, but you need the know how , thers more to it...and you need to know the codes.... its the cheapest to get into , but alot more to know , alot of codes...and a long time top build your name up

    the only simple thing i did with him , was disconnects.... when a house is gonna get destroyed, you have to disconnect the water/sewer..... 500 bucks in less than 15 mins.... it took longer to call for utlity locations then to do the job..problem is , towns at least in my area...are going away from open pit trench,,,, if a latteral breaks and you need to retap off the main , they dont want the steet torn up ... so they want horizontal boring.... which isnt a cheap toy... but it did bring in 100 plus per foot drilled

    i would get a job working for one, and see how it goes , learn what it is

    just many things to keep in mind
  14. OhioPlower

    OhioPlower Senior Member
    Messages: 440

    Im in the same boat as you, except im 21. My plan is to work for other dirt companies for about 10 years then go out on my own. Im gonna get a house paid for or damn near paid for and start saving up for machines to start out. 10 years of experience is gonna help alot too. I was a first year apprentice with the operators union this year and I worked 352 hours. Some apprentices didnt go out to work at all. Right now isnt a good time to start a business in dirt work unless you know ALOT of people. Just go work for someone else for at least 5 years. Theres alot of stress in running a business so be ready for that. Get on heavyequipmentforums.com. Ask the same question and search that same question and you'll have a probably a few days of reading.
  15. murray83

    murray83 Senior Member
    Messages: 420

    I agree HEF is an amazing site with a wealth of information on anything you want to know.

    I gotta go with tuney443,start on small jobs and stay there,the big jobs are really nice but have much larger headaches that you can't even describe.I do septic repairs and alot of residential water & sewer service repairs on the side over the past 3-4 years trying to start my own business and its very hard getting a foot in the door and putting food on the table.

    Use the K.I.S.S method when and if all possible and remember its not very hard to operate a backhoe its alot harder to understand the office side of it and thats where many guys fail.

    Good luck
  16. jethro bodeen

    jethro bodeen Junior Member
    Messages: 4

    thanks for the advice guys
    have a good day n be careful on the job