Start-up equipment questions

   / Start-up equipment questions #1  

MPS

New member
Joined
Aug 12, 2009
Messages
1
Location
Alabama
We started doing some land maintenance work a few months ago, as we realized the commercial real estate appraisal business is going to remain in the doldrums for the foreseeable future. Originally thought the banks would be a likely target, cleaning up and maintaining all the bank-owned lots and subdivisions. So far, the banks are reluctant to spend a dime on property they've already lost money on, but I expect next year may be a different story. We've gravitated toward agricultural/recreational tracts, dealing with people who have tracts too small to justify owning their own equipment, or who are no longer interested in doing that work themselves or paying the fellow down the road to do a half--- job when he gets a round tuit. Trying to offer a turn-key high-quality wildlife habitat management program, with some success.

I've been aware of mulching as a service for four or five years, first noticing when a large developer cleaned up miles of shoreline in putting a bunch of developments in north Alabama. I've had several people talk to me about doing it, and think there is some market for the service in enlarging, expanding, maintaining food plots and fields on rural tracts. I think if I can make some kind of living for the next 12-18 months, the developers will be back, and will need to clean up the subdivisions that they have basically allowed to lie fallow for the last couple of years.

I've got a potential client, a couple of hundred acres, of which he needs about 30 cleaned up to improve his views off the ridge to the lake when he divides his property into estate lots. If he'll commit, I'll probably get brave enough to buy an outfit, and really push with some of my other contacts for more work when this project is done.

If I had my druthers, I'd get all outfitted with a Rayco or Fecon 140 or so from the factory, along with a brand new 550 to pull it. In the real world, if I had that kind of cash, there are probably a couple or real estate bets I'd make instead. I expect I can find an ASV 100 class machine with a decent head for 40-50K, swap my nearly new 1/2 ton for a dependable 1-ton and a gooseneck, and go.

Reasoning on the smaller class machine is that I'm going to spend a fair amount of time dragging it around the state, and I'd rather do it with a 1-ton where I can charge $1.50 per mile than with a dump truck. I've also had the larger machines described as units that are good for nothing but self-destruction. Trees get immovable faster than machines get irresistible. To oversimplify, most of this equipment is good for clearing up to about 4", the skid-steer stuff just does is slower, and is more maneuverable. From what I can see about my particular list of potential clients, I'd rather negotiate about spending more time on a project than watch a 140-class machine rust in the yard.

I don't want to get into a ----ing contest over brands and sizes - I've read enough to look out for some designs and motors, and this work is terribly hard on any machine. But I'd like to hear any commentary, and I've got a couple of specific questions about stuff that's available in my area.

First - Gehl - I haven't heard a word about them - saw the U-tube video with the fellow in the open cab, no safety equipment. The funny thing is, I've had a couple of developers brag about a mulcher around here who is more efficient than anyone else around with a skid steer, and he's running a Gehl. A fellow in my area has got a 7810E with a gooseneck and a bucket and a fae head with less than a thousand hours on the machine for just under $50k. Any comments?

Second - How many hours can you get out of a machine? I understand that tooth wear is on the order of $10 per hour, heads in a couple of thousand hours, track wear is its own subset, but what about the tractor itself?

Any help would be appreciated. If I can't make this work, I'm going to have to find another job, and frankly, it's a --- of a time to look for work in the real estate or banking industry. Hope everybody stays busy.
 
   / Start-up equipment questions #2  
We started doing some land maintenance work a few months ago, as we realized the commercial real estate appraisal business is going to remain in the doldrums for the foreseeable future. Originally thought the banks would be a likely target, cleaning up and maintaining all the bank-owned lots and subdivisions. So far, the banks are reluctant to spend a dime on property they've already lost money on.
but I expect next year may be a different story. We've gravitated toward agricultural/recreational tracts, dealing with people who have tracts too small to justify owning their own equipment, or who are no longer interested in doing that work themselves or paying the fellow down the road to do a half--- job when he gets a round tuit. Trying to offer a turn-key high-quality wildlife habitat management program, with some success.
Tell me about it.
My brother died 3 years ago and his place is in forclosure.
A few month ago the power company trimmed a bunch of limbs and branches away from the elect lines and left every thing scattered all over the yard where the grass and weeds have grown up through it turning the place into a jungle becaus the bank is to tight to spend the money to maintain the place.

Same sort of thing with a house next door to me
Talked to a guy mowing that yard the other day for the bank that had repsssessed it.
Needs some trashed picked up and hauled away but the guy told me the bank didn't want to pay hin to get rid of it.
 
   / Start-up equipment questions #3  
If your really into it I have a '05 ASV RC-100 with a magnum head, grapple, & bucket I would like to sell!! I would also let a 25' gooseneck go for a little more if you wanted it!!
You can pm me if your interested.
:):)
 
   / Start-up equipment questions #4  
The best start up equipment is whats paid for... If the idea will make money, get in with the least investment feasible and let the work pay until you can afford better.
 
   / Start-up equipment questions #5  
The best start up equipment is whats paid for... If the idea will make money, get in with the least investment feasible and let the work pay until you can afford better.

Amen to that. In this economy, IMO, it would be very foolhardy to take out a big equipment loan. As an RE appraiser, I'm sure you're familiar with the term, "The money's made on the buy", or "You make money when you buy RE, not when you sell". This also works for other things, and the less you have to spend getting into it, the quicker you make money, and the lower your risk.
 
   / Start-up equipment questions #6  
I disagree...kinda. I would not go out and buy a bunch of equipment that you have no way to pay for. But, if you have the work and you know that you can pay your stuff of go for it. Things are tight right now so you can get in some good machines right. I have also noticed that as things go on they way they have those who mismanaged their business while things were nuts are not my competition any more. I thought that the competition would be getting more and more fierce but it seems that the guys who do not think straight are gone already. If you have the work...get the machines. If you ar buying a machine and hoping to find the work proceed with caution!
 
   / Start-up equipment questions #7  
The best start up equipment is whats paid for... If the idea will make money, get in with the least investment feasible and let the work pay until you can afford better.
the problem with that theory is that old worn out equipment will not make money in the mulchng business. You need good stuff and good stuff is very expensive!!!
 
   / Start-up equipment questions #8  
It's funny you're getting out of appraisal because one of my friends is getting out of the restaurant biz to get into the appraisal biz. My mother is an appraiser and a broker. She says biz is all but dead.

There's no "magic advice" for starting a business and buying equipment. I've done it all different ways. I've bought junk that needed fixing and I've gone out on a limb and bought nicer equipment that I know I needed.

You can get hosed by doing it either way. No one has a crystal ball to see when the economy will tank, so when you buy new stuff, you might get stuck making payments on idle equipment. Conversely, the headaches of repairing junk when you're really busy will drive you nuts! I know it did for me.

There's sound reasons to buy new and get the best deal you can because you'll have several years of warranty coverage. Blow a powershift transmission on a junker backhoe, etc. and you'll pay a repair bill worth ~10 payments on a new machine.

If you're in it for the long haul, I'd lease or get a newer machine with a warranty. If you're just playing or unsure, I'd prolly buy used so you can avoid the depreciation hit if you get out in a year or 2.
 

Tractor & Equipment Auctions

John Deere Gator Utility Cart (A50324)
John Deere Gator...
2007 Ford F-250 Crew Cab Pickup Truck (A51692)
2007 Ford F-250...
JOHN DEERE 1050 TRACTOR (A51247)
JOHN DEERE 1050...
2015 Kubota KX71-3S Mini Excavator (A52377)
2015 Kubota...
UNUSED LANDHERO LDHGAC40V AIR COMPRESSOR (A51248)
UNUSED LANDHERO...
UNUSED WOLVERINE PT-16-01C UNIVERSAL ADAPTER (A51248)
UNUSED WOLVERINE...
 
Top