Site Grading

turtleman

Hello all, I am new to the dirt working business. I have been reading the post here for sometime now and hope you guys can help me. I live in South Louisiana and I purchased a 2006 D5N LGP cab/air in March 2006 and installed a Topcon System 5 laser guided machine control system. I purchased this dozer to complete a levee project in New Orleans and since completing I have returned home (lost money on project) to Lafayette with the dozer to try and start a precision grading business.

This is the problem that I am having. All the big contractors will not give me the time of day. They tell me that if they have a job that needs a laser then they would have one. These guys are making plenty of money without me today so why do they need me? I was told that I needed to provide turnkey services from clearing the pad, removing brush, rootraking and grading it ($7,000-8,000 per acre --good or bad). The only problem I have with that is that I already have one piece of equipment that is not working and I can not afford another piece. Is it possible to find work doing rough and fine grading with a dozer like mine? How do I find work? This dozer is a cancer right now and I need to get it to add to my bottom line rather than take away from it. I would think that finding work for a grade cutting machine like mine would not be that difficult but I am running into some resistence. This thing can cut flat grade or slopes to 50%. Set the laser and lock on and as long as the grade falls within the scope of the blade's movement then it is done.
My plan of action is to get my general contractors license and start bidding sitework jobs. This will take 4-6 weeks or 2 more monthly notes out of my pocket. Need work now not 2 months from now. I subscribed to datafax and it provides information mainly on the large GC that won't give me the time of day. Not much help other than identifying the GC's. I am going to also keep hounding these large GC's to give up some work. I know that my machine is a cost efficient alternative to having grade checkers and pulling strings. Is a single dozer enough? Do I need to invest in a track hoe and dump trucks? Where to go from here? Wanting to make the right move just don't know which way to go. I know how hard it is to find good help today and I would be jumping up and down to hire a company like mine. Any help appreciated.


TM

rino1494

First of all, welcome to the site

I don't see how you can spend $150,000 on a brand new machine and not have any work for it. Why not buy a older used machine at first, then when you get established and have more work coming in, then upgrade. Around here, there is nobody that does just fine grading work. Most contractors do everything from bulk excavation, grading, utilities, detention basins, etc...

Also, how do you like that D5N ?? We are looking at possibly purchasing D5M this upcoming year. If we get enough work, we may spring for the N.

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jmic

Yeah Hi Turtle,

My question is why didn't you lease the machine for that one job you had? I guess if I had to only own one machine it would deffinatly be an excavator. Very, very limited with a dozer, with an excavator you can really do everything if you had to. Wouldn't always be the most efficient, but would get the job done.

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Joe

4theroc

Man you must be rich. This is what i would do, Sell the machine. Think about it. If i had $150,000 i could buy a fleet of used dumptrucks (tandem axles), 1 dozer, 1 trackloader ( 955 953 655, 755), 1 skidsteer( 267, 277, T-300), 1 30,000 lb+ excavator. And still have money left. Oh i left out a tag trailer (20Ton). Also, large GC's are probably not going to due business with you because you are just starting out and havent made a name for yourself.
Advertise in your local newspaper for the following: Grading, clearing, Excavating. and say we are offering 20% off. Believe it or not, you can make alot of money in the residential sector. Work might not be frequent, but when u look at what u make on a residential job vs. a commercial job you will probably make double if not triple the profit. Word of advice when just starting out always buy used equipment. Never buy new stuff. And dont buy stuff from dealers. Buy from private owners and auctions.

I think you should pay me for this advice because you will thank me for it later

dayexco

you're running at margins where you can discount work 20% and still pay all the bills?

i think profit margins are all driven on how saturated your local market is. personally, my margins are considerably greater in the commercial, municipal work. there are too many guys with mini-ex's, tractor hoes to allow any kind of money to be made in residential. we do residential, but primarily as a filler.

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someday, i'll be as patient as Nick.

4theroc

ya I can make money because First i know how long its going to take me.

dayexco

my advice to you, don't be bragging about your margins in the bar, coffee shops, or amongst friends, you'll have 15 new competitors bombing your pricing. as i said, profit margins are driven locally primarily by supply and demand. apparently for you, there's more demand than there are contractors available. lucky for you i might add!

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someday, i'll be as patient as Nick.

4theroc

Ya around here competition is stiff sometimes, but I guess if your a good saleman, or just ask the customer what they are willing to spend its easy to seal the deal.

dayexco

what if what they're willing to spend is considerably less than what it will cost you to do the job? i like to know where my numbers have to be to insure i make a profit before i approach the customer. what should happen if all goes to plan, is i get the work, make the margin i want, and the customer feels he got a great value for what he's paying me. if their budget numbers say they can't afford me, they'll have to redefine the scope of the job to reduce costs, try to find another contractor that will do it within their budget. although i do have a concern for a customer's budget, i'm far more concerned with mine

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someday, i'll be as patient as Nick.

4theroc

ya your right, I know alot of small contractors that are always hungary for work, and sometimes I say "damn," If that was me i wouldnt even haul my equipment out there for that. So i just sub it out to them. But when i say the discount on the work, please take into consideration this is only for the winter. Everybody knows this type of work slows down in the winter time. If it was summer, I would mark the price up 20%+ because this is when business is booming. But it also goes back to the scope of work you are doing. If something will take u a half a day or 3 days with no laborer's and no materials you can make money. If the job has you delivering gravel, topsoil, or fill, you can make your money off of selling the materials and work your dumptruck. It all depends on what your doing.

Also I wouldnt give a large discount on work over $4000. because think about it $5000*.20 is a 1000 out of your pocket.

turtleman

The job that I did required 4 dozers. I RPO'ed from Cat 2 D6N and 1 D6R. I chose to buy the D5 as I needed the Laser system to finish the job. While all this was going on we were going to do levee repair for years to come and I felt that my risk was limited to some degree. I still may do some levee work but I will need a different arrangement from before to be profitable. I chose to purchase the 5 also because of the lower rates Cat offered me 1.9% fixed for 60 months. If you RPO a machine and choose to convert to a sale at the end of 6 months then your rates jump to 8.5%. I purchased the machine at a good price and added the laser system which cost me $30k. I am sure that when we dry out, I will have work for this machine. I am also going to market complete land clearing and grading and I will need an escavator and some dump trailers for my trucks. I plan on renting what I need to get some work done and see which machines I like the best. I take good care of my equipment and I plan on owning this dozer for a long time. I am somewhat frusterated with my progress but I am just beginning my marketing phase. I am a good salesman and I am sure I will hook up with the right GC and never look back. I surround myslelf with good solid people that anyone would enjoy working with and I feel that is another key to future success. Everyone wants to get paid but nobody is willing to work for what they get. The workforce is terrible here in Louisiana. I have a few good employees and that will make some difference for me down the road. Thanks for your input, I appreciate the advise and I will update you on my progress. This site is one of only a few that deals with site work and grading. Thanks
TM

rino1494

Very very very true. There are a ton of guys that have a backhoe and dozer and or a old excavator that will work for nothing just to get work. Grant you though, there are a few of us around that work in the same price range and we all have enough work to keep us busy.

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Dirt Works

I'm new to the site. Alot of good advice and questions. There is always someone that will do jobs cheaper. I've been through alot in 18 years of business and i have to say that there has been more bad times than good overall. I have always managed to stay busy either way and make a living. You learn as you get older and I was told when I first started that the times of economy woes weeds out out the wanna bee contractors and the strong survive. Anybody can have new trucks and machines all you do is sign on the dotted line. But can they pay for it???? Work and checks slow down but those payments keep on rolling in. Hate to whine on my first post but all you middle age business owners know where I'm coming from.

rino1494

Welcome to the site dirt works. Where you from and what kind of work do you do ??

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denick

Welcome DW,

We're always glad to have a new guy aboard. (I am waiting for the day I am taken to task for saying "guy" by a woman joining in the conversation). Come by the chat room on Thursday night we call it the "Misery Loves Company Hour"

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Nick

"Every day I remind myself that my inner and outer life are based on the labors of other men, living and dead, and that I must exert myself in order to give in the same measure as I have received and am still receiving" Albert Einstein

Dirt Works

Hi Rino, I'm from Southern New Jersey. We do excavating, utility and site work for smaller subdivisions and alot of septics. About 2 years ago I started a small crew for concrete work (flat & curbing only). I was getting ticked at subbing out, paying top dollar and still doing most of their work. I always told myself I would never wonder outside my trade, but that work came at a good time. It seems like that work always pays the bills when the iron isn't. I like to keep my prices a click higher than my competitors, I have to say about 75% of the time the customer knows he is going to get a great job and is willing to pay the difference. I don't know about you but it always seems to me that the people who b*%^h about the price up front are always the people you chase for the $$$ at the end. Hope your keeping busy because no matter what in this business the bills keep on rolling in
Thanks for your time.

denick

Turtle,

Reading your posts I am a bit confused?

Would you want to tell us about your background?

What did you do before the dozer?

Where did you get your experience?

Do you run the dozer?

How many people do you employ?

What other equipment do you own?

If we know the whole picture it's easier to try and give advice thats helpful than trying to sort out all that you have thrown out so far.

Only trying to help.

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Nick

"Every day I remind myself that my inner and outer life are based on the labors of other men, living and dead, and that I must exert myself in order to give in the same measure as I have received and am still receiving" Albert Einstein

ruskent

Dirt works- welcome to the site.
Where in south jersey are you located. I need a excavating and concrete flatwork sub to do work basically any in south jersey. I'm from north jersey and it looks like i will have alot of jobs coming up down the shore and have no contacts in those areas. Any i am scared to death to call someone out of the yellow pages! Do you do stamped concrete also?

Matt

turtleman

I have lived in louisiana all of my like. I employ from 10-15 employees that work for me in the oilfield industry here in south la. I have been around oilfield construction for the last 10 years or so. This would be building road and sites for drilling rigs. The D5 is the 1st piece of what I wouold call true construction equipment that I own. I also own a tractor with front wnd loader with all the attachments. I own several 18 wheeler tractors that I could add wet kits to and haul dirt or brush (land clearing). I plan on getting my contractors lic and bid work direcly as soon as I can. I am sure that when we dry our work will be available. I also plan on adding a mid size escavator(40,000lb). My main manager has many years in the underground storage tank business, he has many years experience in bidding directly and installing gas tanks and running drainage pipes. My main goal is to purchase land, develop subdivisions and sell lots. Once I get a year or so under my belt I will start with something small and see how it goes. Thanks for the advise and I hope this history on myself will answer some questions for you.

TM

Dirt Works

ruskent, We are located in Atlantic County which puts me 30 minutes to Philly or to any shore location. I do not do stamped but could refer you. Shoot me an e-mail Dirtworksrr@verizon.net if you need anything.

Sorry don't what to hi-jack this thread!!