Any Help Needed For My First Venture.......

TMatt142

Hey everyone! My name is Tim I've got 17 years experience in the construction industry (mainly highway heavy). For about a year now, I've worked with a small excavation company doing their underground stuff for their accounts with plumbers and some site work here and there. Throughout this past year, all the contractors I've worked for have expressed and interest in hiring me if I were to start my own excavation company. As fate would have it, a friend of mine who also owns his own company, has offered to help me get started by purchasing a backhoe. My main weakness with starting up this whole thing is estimating. Not that I don't know what it takes to do X amount of work and such, it's just that I've never estimated. The work I can start out with is hourly stuff, but I know that doesn't take a guy very far plus, I can' see how a person could even schedule a bunch of hourly work being that the hourly stuff is usually short notice (1 day or 2). I'm excited about starting but don't want to be confused about this. Any help would be appreciated.

denick

Hi Tim,

Glad to have you here on the site. What do you know about running a business? Where do you call home? Besides buying a backhoe what's your overall plan? What type work would you be estimating? Have you worked up some numbers on what your costs of doing business?


Just questions to get conversation going.


Welcome Tim.

Nick

rino1494

I could write a novel on estimating and your head would spin clean off. It is the toughest part of this business and not knowing what your costs are and if you are actually making money is where people go wrong. I read somewhere that around 80% of contractors don't actually know how much it costs them to run a business. This is why there are so many businesses going belly up.

Ask around and see if you can find the typical going rate for a backhoe in your area. If someone needs 30 min worth of work....make sure that you get a 3 or 4 hr minimum. You must get mobilization too. On materials, make sure you mark them up 10-20% depending on what it is.

Here are a couple books that can help you out.

http://www.amazon.com/gp/product/093...g=UTF8&s=books

http://www.amazon.com/gp/product/093...g=UTF8&s=books

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TMatt142

Ok, so far here is what I have. I'm in the St.Louis area and am in local 513 operators. The connections to work I have are doing site work and underground for plumbers. Right now I have 4 contractors who are willing to hire out my services on an hourly rate. Not to mention My partner (the money man) has a bunch of subdivision work that basically would be the fill in stuff. He wants to get $108.00/hr for operator/machine which I believe is what a lot of contractors are looking for in the area. As far as my estimating experience, None, I know certain things just from being a part of a family business. mobilization, fuel surcharge, stuff like that but for the most part, its all greek to me. I never was included in on that part of the business. My one year outlook would be to have steady work for that year. Down the road a bit I would hope to be bidding a lot of this site stuff (larger scale) and have a few contracts with companies long term as their excavator. I would also like to be on a list doing emergency work for the water companies in St. Louis, since a lot of that stuff is subed out.(from what I hear). Do I need to keep going????

rino1494

$108/hr for what machine ??

__________________
Life is hard. It is harder when you are stupid

Uncle Sam wants YOU....to speak ENGLISH

TMatt142

Jd 410

denick

Tim,

Have you found out about your State and Federal requirements for your new business? What are the license or registration for contractors? Have you talked to an accountant and lawyer who know construction, about setting up a business? What type of business is best for you to operate under? What is the cost of thier services for the year? Sales tax filing? Bonding for street openings? What is the cost of your Insurance? What insurances are required? Do you have a contract formatted and does it conform to your states laws? Who's going to do the billing? How are you going to pay yourself when you start? What is the total cost of start up ( pick up truck, fuel tank and pump, shovels and hand tools,grease guns, compactors, pumps, road saw mechanics tools, etc, etc)? where are you going to park all this, is there a cost? How are you going to move the equipment and whats the cost? How many billable hours a week are you basing your estimation of cost on?

Have you looked at dayexco's post on doing business with friends?

Have you thought about taking a business course?

Nick