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Great plan, but need some advice

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cptnMorgan92
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Great plan, but need some advice  Reply with quote  

I've done a lot of thinking about starting my own small business here around Eastern Wyoming and into Western Nebraska, and ran some numbers and i know it will make money. But my credit Is pretty pathetic right now and i think i would just get laughed out of a bank. I need money for a truck, trailer, utv, and other necessary equipment, in all no more than $70,000. Any advice would be helpful on how to go about making this happen. Tia
Post Tue Sep 27, 2016 6:28 pm
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oldguy
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quote:
truck, trailer, utv, and other necessary equipment, in all no more than $70,000.


A common failure of 'start-ups' is over capitalizing. The equipment payments suck-up nearly all of the earnings, and a weak month often results in re-possession of equipment.

I suggest about a $5000 truck, a $1000 trailer, and a used utv. As the money starts to roll in and your cash reserves build up over a year or two, start renewing the equipment, one item at a time.

As an example, in our area we see lawn mowing companies come and go. When a guy starts out with a $60,000 2016 Diesel Big Dually and brand new equipment, he goes out of business quickly. And the dude with the paid-for 2000 Dodge, 125,000 miles, does just fine.

We see quite a few Drone businesses starting these days. They film hikers, skiers, farm fields, crops, forests, and provide aerial photos for real estate sales.
Post Tue Sep 27, 2016 9:55 pm
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cptnMorgan92
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Right, that was my plan. Buying all used. But finding a decent diesel truck to get me to job to job while pulling a gooseneck trailer with equipment is hard to find for $5000. Either way i would need to borrow money. $75,000 if it were all new equipment, but as you were saying that would be a bad idea. I figure i could get all used stuff for no more than $25,000. That would include, a truck $12,000, trailer $2500, utv $5000, sprayer $3000 and other misc items. I would charge $45 an hour to ranchers, farmer's, and land owners to poison invasive weeds and land wrecking prairie dogs. Do you think a bank would even consider this proposition?
Post Tue Sep 27, 2016 10:20 pm
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oldguy
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I would charge $45 an hour to ranchers, farmer's, and land owners to poison invasive weeds and land wrecking prairie dogs. Do you think a bank would even consider this proposition?


Does the $45/hr include the chemicals? You can spray a lot of Round-Up in an hour, that might take a bunch of the $45. And IMO, you need to do the total job, people won't hire you if you require them to furnish the chemicals. I think you'll need way more than $45.

But most rancher/farmers already have a utv and a sprayer - and they don't need the truck/trailer, they are already on site. So it may be hard to drum up a customer base? In any case, start out cheap - and buy new stuff later.

I've got a 2001 4WD Dodge 1500, over 100,000 miles - they cost about $7500. And a flat bed will do well, I have a 16-foot flat bed car hauler ($1500), I haul small farm tractors.
Post Tue Sep 27, 2016 10:59 pm
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cptnMorgan92
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Last edited by cptnMorgan92 on Tue Sep 27, 2016 11:15 pm; edited 1 time in total
Post Tue Sep 27, 2016 11:07 pm
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cptnMorgan92
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Last edited by cptnMorgan92 on Tue Sep 27, 2016 11:15 pm; edited 1 time in total
Post Tue Sep 27, 2016 11:07 pm
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cptnMorgan92
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Nono. Hahaha. Round up will not kill these weeds, and certainly not acres and acres of land. You need a pesticide license to buy this kind of chemical. And mix it in with water with what would be a 75 gallon water tank. And it sits in the back of the utv and can spray out the back. The chemical cost $700 and the state of Wyoming pays a good percentage of that and cost me around $140. And a half ton pick up will not carry 300 gallons of water, a car trailer and a utv while traveling on uneven ranch and lease roads, you would need atleast a 3/4 ton or better. $45 a hour for a ranch is better for them and better for business. I help a friend do it now who owns a reclamation company and he 45 for ranchers and 90 to oil field companies. We're doing a ranch for prairie dog infestation now he will have work there for atleast 3 years because that ranch has so much land, and prairie dogs breed like crazy so it spreads and spreads over all of that land
Post Tue Sep 27, 2016 11:12 pm
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cptnMorgan92
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So $45 a hour, you work 10 hrs a day, $450 a day, $9,000 a month, 108,000 a year. And that does not include the cost of chemical. Or paying an employee.
Post Tue Sep 27, 2016 11:20 pm
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oldguy
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And a half ton pick up will not carry 300 gallons of water, a car trailer and a utv while traveling on uneven ranch and lease roads, you would need at least a 3/4 ton or better.

So $45 a hour, you work 10 hrs a day, $450 a day, $9,000 a month, 108,000 a year. And that does not include the cost of chemical. Or paying an employee.


My 1/2 Ton 4WD does fine pulling my flat bed and a tractor, 7000 lbs. About 500 lb tongue weight. Does well at freeway speeds, as well as dirt trails in the back country. You'll be pulling only about 2500 lbs of liquid, maybe 1000 lb utv. But if you learn later that you need a heavier truck, that can be one of the first upgrades.

As for the 10 hr s/day, 20 days/month. projection. If it wasn't for the rain/floods in Iowa, I would be driving a Deere Combine thru corn fields. So much for 20 days/mon. Oh well, maybe next week, lol. You'll have days when it's too windy to spray, too rainy, an occasional breakdown, yada. So allow some reserve in your calculations.

Good deal on that 3-year prairie dog job, that is the kind of continuity that pays the bills.

As for getting a business loan at a bank - yeah, probably pretty hard. And they would want a business plan etc. I would buy the pieces separately. The equipment is fairly normal recreational items - everyone has a 4WD pickup, utv are common toys, and a trailer to haul a utv is common. So I would put a loan on each item as you buy them (that also makes it easier to upgrade individual items later.
Post Wed Sep 28, 2016 2:16 am
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andre43
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And this one

loans for bad credit
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