[sandim]

I don't think your chicken 4Seasons, I think your smart! Granted our volume is not quite where yours but we're sooooo careful about buying equipment. We don't have much, like you, we rent when we need it. I can happily say for every piece of equipment we have, after the purchase, we've been able to say "well worth it."
I understand the temptation to own equipment, but I hear of so many companies that get in trouble because they bought too much too soon.

[site]

Are you risking everything to make the purchase? Do you have solid commitments for work this season? Can you see a way to increase your net income because you own a skidsteer? Are you confident you can make the payments even when the economy slows down? (From what I hear this housing crisis thing wont really work itself out until 2009). Will it create it's own market? In other words when your customers find out you own it will they reccomend you and your skid steer to friends? I always try to think like a businessman in these situations. It is hard not to listen to that kid inside that insists on having a new toy.

[moose02]

All great points, If i buy a tracked skid steer is still up in the air a tire ss would more than likely do fine for the coming season & for price reasons. I'm hoping to double last years sales I started late in the season last year and spur of the moment sort of thing.

The way I see it is that I am a one man crew, I need to hire employees in order to move quicker or use the help of machinery. To be frank at this point I would rather pay $20k toward a machine then a couple of lazy kids & the gov (in most cases). Also if i was $5k a year in rental I would rather put that toward something that I own and now have to use when I need it.

Maybe I'm being a little quick to jump the gun on buying one, but I hate renting. I need one for 10 mins here an hour there and so on. Having a machine will hopefully open more doors for larger or more projects as well as showing folks that I mean business

Just my 2 cents, its great to have this board that allows us to hear everyones Opinion and help one another. I'm not so sure I will spend the extra dough on a track machine now after this, but a ss is still in my future

[Mac]

Originally Posted by moose02

... as well as showing folks that I mean business

I think you were sarcastic, but please dont ever use this as a justification. Yes it is important to look the part but simply having a skid steer, whether rented or owned, allows you to look the part. Image is important but it should not weigh heavily when a purchase is considered.

[sandim]

Moose,
If you're going to invest in your business, I think you should consider employees or maybe sub-contractors. Yes, machinery is awesome and definitely makes the job faster and easier, but there are things that you may be able to use your employee for that you cannot use a machine for. You can rent a machine if necessary, not an employee.
Also, most of our homeowners are never home. We don't put down "Backhoe rental" on the invoice, we just put down "backhoe".
If you're going into your second year, esp. with the economy the way it is, I think you should wait and rent this year. See how often you use it and if it's worth it. That's a lot of cash out for a ss if you don't use it as much as you think you will.

[scl]

I also think that we're all looking at this from a "buying a new one" standpoint. We are in this credit culture now of buying everything new, bigger, better because its just a few more dollars on the payment. There use to be this little saying called "buy what you can pay for" and its more appropriate now than ever. That is what is driving the mortgage crisis and why affordability is not an issue when new houses were getting 40% over budget (sorry, small rant). That said, I strongly believe that a SS is the single most important piece of iron I own, and I bought mine 9 years ago for 60% of new with 300 hours on it. Yes its taken some maintenace, both PM and troubleshooting, but thats one of the tradeoffs.If you wait and look, especially this year, something rightwill come along. But don't think you have to go $30K in debt immediately. I think everyone on here has presented valid and insightful points. I believe that the smaller your operation the more plausible and benficail one is.

[scl]

I also think that we're all looking at this from a "buying a new one" standpoint. We are in this credit culture now of buying everything new, bigger, better because its just a few more dollars on the payment. There use to be this little saying called "buy what you can pay for" and its more appropriate now than ever. That is what is driving the mortgage crisis and why affordability is not an issue when new houses were getting 40% over budget (sorry, small rant). That said, I strongly believe that a SS is the single most important piece of iron I own, and I bought mine 9 years ago for 60% of new with 300 hours on it. Yes its taken some maintenace, both PM and troubleshooting, but thats one of the tradeoffs.If you wait and look, especially this year, something rightwill come along. But don't think you have to go $30K in debt immediately. I think everyone on here has presented valid and insightful points. I believe that the smaller your operation the more plausible and benficail one is.
And there is some truth to the legitimacy issue. I have customers ask where my equipment comes from, how long have you had it, boy that is nice, blah, blah, blah, all the time. Its just coversation mostly. But I just hate having to say it came from Ace Hardware or XYZ rental. Then that leads to another discussion of renting and why and more blah, blah, blah, which, yes I know, it shouldn't matter and its none of their business, but that matters to me (2nd small rant). As before, do what you can affors to. You can always upgrade.

Scott

[Nebraska]

No piece of equipment will make your business grow. In my opinion buying a skidsteer with $60k in revenue is putting the cart before the horse. You can rent when needed and not have the headache at this point in your business. When you can either afford a large down payment and the ability to pay the remainder off in 24 months or less or even better yet pay outright for the equipment is when you should consider.

Focus upon sales and marketing first.

With renting there is the advantage of also realized lower costs, less use of capital, and no maintenance and it's a 100% write-off expense. At $60k in revenue the big issue should be "less use of captial".

....that's just my opinion and for the record we still do not own a skidsteer (excluding our paid for Ramrod Taskmaster 1150) going into our 12th year.

[Paul]

I have to agree, K in sales isn't enough to justify a skid steer. What are you bringing home? Not enough!! Sales you need more sales.

[moose02]

I will do double $$$ this year, The machine I'm looking at Ive worked my finance out and I'm $350 a month + maintenance so I'm certainly not braking the bank on any thing. Also why pay anything out right when the business can pay for the financing? The money that would be tied up by paying it out right will be working toward building a new house

In my case a machine will make the company grow rental or not because there are only so many things a shovel can do and if you turn a job down because you cant move a few rocks around well your not growing your moving backwards.

[Pelican]

I rented machines when I started out, I didn't have the capital nor the security established to take the risk in buying a machine. When my monthly rental fees approached the amount a payment would be on a machine, I took the risk. It has paid off tremendously, not only do I have equity in the machine, but I'm not spending time picking up and returning the machine, which would be a minimum of two hours each time I rented. The other plus is convenience, I have the machine where I want it when I want it, I don't worry if it is available when I need it or if the job is big enough to warrant the time and expense of renting a machine.

I'm curious about $350/month for a tracked machine. You've either got a huge down payment or found one somewhere dirt cheap. My machine was nearly $900/month in 2000, a rubber tired skid steer.

[Paul]

I'm Sorry but a few things I have found thru 30+ years of landscaping, When Jeff bought his machine $60K in work was a lot different than $60K in work now days. Inflation has somthing to do with that, When I started posting on the net, 10+ years ago I figured a man to do $100K in gross sales, now day I would expect that number to be closer $150K in gross sales. I know closer but I'm semi retired now and my consulting did $60K in work last year part time.

It's really nice to figure your machine is going to cost you $350 per month, wait we forgot insurance, fuel, maintance, replacement cost, replacment parts, and other overhead. If you go back and read my posts I'm all for having equipment! If you look closly you'll see that I had all sorts of equipment. But I don't think you have reached that point yet (labor you use once, machine you you have forever). It's still you doing the labor right now and rental is not killing you, your back maybe, but out of pocket wise your in good shape.

[moose02]

for sure ill be more than 350 a month buy the time you add everything up. Everybody has a different ways of doing things and I was curious of what other folks were doing, however even with everything said I'll still purchase a piece of equipment. Wont be as large or costly now but I will still buy. My way may not be the right way for allot of folks but I'm confident it is for me .