side business using new tractor

[Billc]

Del,

That was a great post. You really got me thinking. I don't carry insurance on my tractor. Never really considered it necessary. Looks like I have been wrong about that. Never know when an accident will happen.

Bill Cook

 

[Billc]

John,

Guess we'll just disagree on this one.

I think about 90% of my work is a call back. I live in a rual area, lots of pastures. So most of my jobs are cutting, fertilizing, seeding, plugging, or spraying. I try to steer clear of grading work. Have always thought the contractors could do a better, faster job. The only grading work I'll do is the simple things..."can you move that mound", or "can you make the water drain that way".

One other note, as I said before, very few of my jobs are only an hour...in fact, I can think of only one job that I've done that took me only an hour, and it was around the corner from me. Most of my jobs are several hours to a couple of days long.

Anyway, I do wish you much luck as your business grows, and hope you will be a successful contrator.

Oh, one other thought, and this may help your business to grow. When I'm done with a job I always send a thank you note. Also, because I only will take a job if it's in my immediate area, I'll swing by and see my customers every now and again to see how they are doing. I've gotten a bunch of work from this. Can't tell you how often I've heard them say, "Bill, I was meaning to call you about..."

Good luck to you, John.

Bill Cook

 

[TomG]

Guess I've got to say pretty much the same thing. I ran a sideline sound & lighting company for 10 years. It started out as a service to help community groups with fund raising events etc. However, the service attracted bands that played at fund raisers, and the bands thought they were going to be stars and needed BIG PA. I found myself with over $100,000 in equipment and engineering some pretty big events.

I recognized the potential for serious injuries at my events pretty early in the business. I got insurance to protect myself, and also from a feeling of basic responsibility. The commercial insurance payment took any notion of profit out of the idea. Well, I didn't start out with a profit idea anyway, I also didn't loose much money when I got out and I did have fun. It's probably best to think of a sideline business as a kind of alternative for taking fancy vacations.

What I think I learned is that a sideline business that requires a lot of equipment probably doesn't work very well. The equipment has to be kept busy or it makes less money than savings bonds and a second job. To keep equipment busy, somebody has to spend a lot of time promoting new clients

Basically, once the insurance bullet is bitten, it's really difficult to keep a sideline idea from turning into a full time one. The syndrome starts when you rent a piece of equipment to do a job and then realize 'Gee I've rented that a lot. I'd be better off just buying it.' Of course, farmers know all about expensive equipment that is needed but only works a few weeks a year.

 

[john4nh]

Mr. Cook
I csn see that we just perform two different services, I think that is why we approch it two different ways. 80 OR 90 percent of my work is grading (finish work) So as I said before not alot of call back on that. The note thing is a very good ideal, I will probally try that now that Iam going into the stump-grinding side of this work. I have usaully just made one phone call back to insure everything was still as the home-owner wanted. The type of work you are performing is done around here by strictly farmers with lots of green. (money and equipment) So thanks alot and the very best of luck to you and to every one out there trying to make a niche for themselves and there families..

 

[gordon]

What we do is is two fold, we sell two things TIME and SERVICE. There are a number of different ways to approach this the main thing is to get something you feel comfortable charging for or what not to charge for. I charge for my time involved in a job but I don't feel that I'm honing the customer. Bill think of it as this if you have 10 hours a day to sell in time and you spend two of those hours in driving-loading-unloading time you are now only 80 percent productive instead of 100 percent productive. So in a five day period you are only getting four days of pay---it can add up quick can't it! I can relate to the plumbers charge of travel time for one reason---time is money So so far we have lost 20 percent of productivity for not charging travel time. Now out of our base rate of charge we have machine upkeep-oil changes-grease-tires-filters-and of course fuel. Oh my now we have a tractor payment to consider as well. Hummm did I mention insurance yet. At thirty an hour the above debits add up to another day and 1/2 you have to give away and that is being very light on the figures. So now we are down to $650.00 for fifty hours worked. Now dag nab it I got a job twenty miles from the house and I need a truck and a trailer. Now once again for a cheap payment for truck and trailer figure $150. off the top a week so now we are down to $400. a week for fifty hours worked. oooppppsss just had a break down there goes the profit for the week./w3tcompact/icons/smile.gif

Now lets look at a two or three hour minimun if it's not hidden from the customer and the customer is told this up front I also feel that its a fair charge. Reason being on a productivity scale you load up and do an hours work you get done in an hour instead of four hours because you know what your doing and how to run the heck out of your tractor. Is this costing the customer or actually saving the customer money---this one is a two way street. You have charged a two hour minimun (that is what I charge) one hour actually working and one hour loading and unloading.

Now lets talk about service which this all boils down to. If you get the job done when you told the customer you would. A follow up call or stop by---this gets you alot more work in oh by the ways. Charged a reasonable fee for the work. Above all make sure that the customer is 100% happy and if he is not make sure you do what it takes to make him that way. But service above all is being able to run the tractor at its peak preformance---and what ever you have on the rear of it.----Nothing better than a customer saying---your done already wow thats great. It makes you look better (word of mouth work down the road) and it costs the customer less.

Man this is sounding like I could make a killing at runnin a tractor---Once you start adding up the little stuff it sure takes off the gross and puts a dent in the net./w3tcompact/icons/frown.gif

Depending on the work I charge between 30-80 an hour.
I tell the customer of all charges up front and the customer makes the final decision about using me to get his job done or if he is unhappy with my charges he can call someone else.
My two cents about tractorin work
Many different ways to approach it
What ever the market will bear.
Ok ok I'll shut up for now./w3tcompact/icons/smile.gif
Gordon

 

[Bird]

All this talk about charging for travel time - or not - reminds me of the '89-'90 Christmas/New Year's season when we returned to Dallas for the holidays in our travel trailer and had an ice storm and record low of 1 degree above zero. The couple in the RV next to us had their furnace quit working and he called a service company. Two men in a truck showed up in less than an hour, in spite of the icy roads, had their furnace working in less than 10 minutes, and charged $35 total. And the guy complained about the high price for a 10 minute job./w3tcompact/icons/laugh.gif/w3tcompact/icons/laugh.gif If it had been my furnace and they had charged $100, I'd have considered myself very lucky.

Bird

 

[gordon]

Guess that goes to show that sometimes you can't put a dollar value to a job at times. Here are two guys who know their way around furnances and get the job done real quick and don't charge but pocket change to help the guy out of a jam. Some people are never happy--sad but true!

I would have hated to see if those two guys didn't know squat and bumbled their way around for two hours or even three hours and charged the guy $100. Shame of it is the guy would have probably have said man those guy's sure worked hard on my furnace but finally got it going for only $100.00 out of pocket.

By the way Bird at the shop it costs $60.00 just to say hello to me plus a travel charge of $50.00 flat fee if I have to go on the road. To me like yourself $110.00 to get that furnace going I would have been happy but for $35.00 I would have tipped those guys a twenty spot each!!!

 

[Rowski]

Great post Gordon.

Time=Money

Money=Time

This is from a business veiw. If you are doing it for fun on a Sunday for a little pocket change, go for it.

As you mentioned, it all comes down the customer being happy with the finished product and paying the bill. I wouldn't even think of doing work for someone if I knew that they would put up a fuss with the bill. It's a shame that some people get upset when some one makes some money.

Derek

 

[Billc]

Fishman, this thead should give you some good info on the tractor busienss. As is common with this board you have gotten varied opinions with lots of good information.

Rowski, don't know if your statement "It's a shame that some people get upset when some one makes some money." was directed at me or at the customer griping about the bill. If it was at the customer I agree with you 100%. Have only had that happen twice. I'll never do work for them again.

I think a person has a right to make as much as they can. IMHO Bill Gates deserves every dime he makes. Don't think he or anyone else should pay one dime in taxes either. I don't think someone gets rich because they are fortunate. Being fortunate implies that they are lucky. Luck has very little to do with it. Hard work and not quiting even though you can't see the light at the end of the tunnel has everything to do with success. As my mother always told me, "Rich people are rich because they do the things rich people do. Conversely, poor people are poor because they do the things poor people do. For the most part being rich or poor is a matter of choice.

Opps, got a little off the point. Anyway, I am against trip charges and minimums because I don't like it when I get charged with them. I understand the point of why others charge thoses charges, I just don't agree. Going back to my original example, when a plummer shows up to do some work for me, I don't think I should be charged for the time he took to get there. Rather, I should be charged for the work he did. When I first retired I worked at Home Depot for a bit. The store was 30 minutes from my house. They didn't pay me for the time it took me to get to the store. My wife works for her dad two days a week. He is 1 hour away. He doesn't pay her for her commute time. To me getting to work is the workers responsibility. I would, however, be in favor of charging a doctor a "waiting fee" if I have to stay in the lobby for over 15 minutes waiting on my appointment. Anyway, that's why I don't like trip charges.

Now I understand the reason for minimums, and after reading this thread I have changed my mind and agree with y'all. Again, almost every job I've taken involved at least several hours work so its not something I thought about. Thanks for the lesson on this.

Bill Cook

 

[Rowski]

Bill,

The statement was not directed at you. It was at the gripping customer(s). The quote from you mother about rich and poor people is so very true. It would be pretty cool to charge my boss a "trip charge" to got to work!

Derek