I want to start a small excavation business...need advice!!

[RPPaving]

This area is tough, there are a lot of small guys running around doing things like this already but then there is still demand. I don't see the OP getting rich off this but if he can keep his budget in line and do side jobs as he gets them he could make some extra money while enjoying the outdoors.

While I didn't expand too much in your other thread dealing with what size excavator I will add a little more to this one. Drainage work is great if you have helpers checking the grade for you. It keeps you in the seat and making progress. If your going to try doing things like this by yourself you will find it very frustrating hopping in and out of the machine every 10' checking grade. You can go with a laser setup of find an old style transit (will be much cheaper but need two people to be efficient to run this style).

I already covered the stump issues, concrete can be even worse then stumps. I just had to dig a drain line for a job site and the line was entering the building at an old window well that was filled with gravel. I dug as much gravel out as I could and started trying to work the concrete loose. It ended up being almost 2' thick on the bottom as they dug the hole, formed up the inside and poured the concrete from the form to the dirt. Had to use a Cat skid steer and lots of blocking to get it out. My mini could start to lift it but it was too bulky to really be able to get out of the hole. I could have dug a deep hole next to it but that would have been admitting defeat. When it was up high enough we put the skid steer bucket under one edge and I backed up while holding the other side. Drop the blade and was finally able to pull it onto the surface. Then used the skid to push it out of the way. I never expected it to be that big. It was almost worth getting the demolition hammer and breaking it down but again, that would have been admitting defeat.

Small ponds and such are fun projects. Charge by the hour though that way they can have you dig till their pockets are happy. Digging a pond with a mini (or any excavator for that matter) can be a challenge as you need to keep moving the spoils away. You will find it very frustrating as you spend more time moving spoils it feels like then you do digging the pond.

I have a friend who has a full time job but he does small projects on the side. He has a 3 ton mini he uses for drainage projects, a small dozer and small loader tractor (small Kubota 30 horse unit). He stays very busy just by word of mouth doing small projects for people. He knows what his equipment can handle and what it can't and he isn't afraid to turn down projects that are too big or too much of a hassle. He makes some extra money and it helps him to keep adding to his toy fleet but it isn't his sole income. Try to find your nitch and build up slow. If you have very little excavator experience it will be easy to cut your own throat bidding. Try to pick jobs that pay by the hour till you get enough experience to better bid a job. And remember, bidding an excavation job is a gamble, you never know what your going to hit under ground till you start digging. And remember, 811 is your friend. Call them anytime you dig and always be careful.

Ill try to expound on your comments from each paragraph (btw thank you once again for going into detail on another post, it is all very very helpful)

When I do excavate, I would have 1 or 2 other workers with me, and if its drainage they would have to keep a constant grade for me as well, i dont want water flowing uphill haha, and i would hopefully be able to find an older style transit that would do the job just fine, in regards to depth.

Also in response to how you took out that big concrete slab, I have almost identically did the same thing many times when I used to do blacktop and we had to dig out the old concrete driveways. You have to wiggle and shake the concrete chunks with the excavator while lifting up the edge with the skidsteer bucket, and just try to pull the chunk out as well as possible.

But you said that you could have dug around it and just pulled it out with the mini, but you didnt want to admit defeat haha

I would love to do work on small ponds, creeks, other bodies of water etc... I talked to my dad about it today and he also said charge by the hour so i could dig until the client is happy with the job.

--On that note, I would have to keep the dump trailer by the excavator the entire time im digging out, so i wouldnt have to worry about cleaning up piles of dirt/mud/etc later right??

--Your friend who does the excavator job on the side from his full time job is what I want to do, start off with craigslist and word of mouth at first. It looks like he has quite a small fleet though (mini ex, small dozer, small loader) so his job opportunities are probably much mire open than mine, unless I choose to rent some equipment for bigger jobs.

I have alot of construction experience, but little operating experience of an excavator. So I would only bid on jobs that I could handle and have some knowledge of as well.

Also you recommend that I only bid on pay by the hour jobs? Ill make more/less that way, or its just better to do before I bid on a contract job (1 payment)

 

[RPPaving]

Also I know its somewhat of a broad question, but im wondering what could i charge for excavation work, on a per hour basis for the following jobs:

-stump removal
-trenching/drainage
-concrete/rock/blacktop removal
-and an other services as well that are worth mentioning

 

[JD 4520]

RPP - the type of questions that you are asking makes me cringe. It sounds like you are going from the desk to the outdoors without knowing what to where and where to start. Most of the questions that you have asked you should already know if you want to be in business. Doesn't matter what kind of business it is, you should work for someone before you launch into a venture purchasing expensive equipment and not knowing the risks, the business or what to do and what not to do.

I am saying this in a helpful way. Small business is great but until you have experienced some of these things first hand you really don't know if you should do this or not.

Do you have a business plan?

 

[RPPaving]

RPP - the type of questions that you are asking makes me cringe. It sounds like you are going from the desk to the outdoors without knowing what to where and where to start. Most of the questions that you have asked you should already know if you want to be in business. Doesn't matter what kind of business it is, you should work for someone before you launch into a venture purchasing expensive equipment and not knowing the risks, the business or what to do and what not to do.

I am saying this in a helpful way. Small business is great but until you have experienced some of these things first hand you really don't know if you should do this or not.

Do you have a business plan?

Yes i do, i currently own a decent sized snowplowing company right now and my good friend owns a trucking/excavating company so ill have him help me in buying the machine, estimating at first, and just basically aiding me with the information i need to help it get off the ground.

Ive done construction for many years, but i have always loved the excavation aspect of it, so therefore i want to start my own small excavating business, so hopefully this forum can help me out

 

[JD 4520]

Since you have a friend in the business, would or could you work with him for a little while to get a better fill for what you can do in your area and the pricing and what size machine, what to stay away from. No different than your snow plow business. Learn it first then you will have a greater degree of success and satisfaction and much less financial risk.

 

[JD 4520]

Since you have a friend in the business, would or could you work with him for a little while to get a better fill for what you can do in your area and the pricing and what size machine, what to stay away from. No different than your snow plow business. Learn it first then you will have a greater degree of success and satisfaction and much less financial risk.

And life will be more enjoyable as well!

 

[RDrancher]

Honestly, I would work at whatever job you're at now, go after the work you're interested in and rent equipment until you get it figured out. In this VERY competitive economy it will give you a chance to search for a niche market without an equipment payment to worry about right out the gate and figure out what type of equipment you really need for the jobs you want to do. Since you're paying for a rental, this method doesn't work very well for hourly work, but your financial risk is minimal. YMMV, but I do over a hundred bid jobs to every by the hour job...there's not enough money in it.

Whatever you do, get liability insurance to cover your tail, learn how to write a good contract with an "unseen underground objects clause" and "rock clause" in it. If you have employees and don't have workman's comp insurance, you're opening yourself up to a very large (and ugly) can of worms.

Don't get me wrong...I don't mean to discourage, I love to see young folks with the entrepreneurial spirit! I wish I had started the business I'm in now 30-years ago. It's a lot more fun with a lot less headaches than the business I owned before.

 

[Qapla]

For the trenching part of the business, besides drainage, you might see if you could get any work trenching for plumbers doing new construction. Many have their own machines for this, but not all do. Also, there is usually not near the buried surprises under new house foundations.

 

[BeezFun]

Also, my other main question is this: what could I specifically do with the machine?

One niche might be using small machines that don't tear up people's property and can fit through reasonable sized gates without taking down fences or damaging trees. People have concerns that contractors either don't want a small job or will make a mess of their yard and damage their trees. If you promoted a willingness to do small jobs in a yard friendly, driveway friendly way, there might be something there. That would also leverage the fact that you have a truck and can haul away dirt/debris, something the homeowner typically can't get rid of.

 

[schmism]

I think you might have more success starting with a large skidsteer and offering to partner with a concrete guy who does flat work but doesnt do excavation. Pays well, and work is steady. Once you have some cash flow and your out in the world working, you can take a look at what other gap in your area needs filling and move into that, whether it be a small trackhoe or med size one.

But that seems to be the simple stuff compared to all the questions we field about insurance, CDL's, bonds, registrations with municipalities, LLC etc. Its been my experience that you need 10x help with those parts of it than you do rounding up equipment and jobs. and to be honest, that last part is what makes a small business a business and not just some fly by night operation/hobby.