Charging for mini-ex/skidsteer combo

[Electra_Glide]

Here's a question for you guys that run your operation with skid-steer and mini-ex.

How do you guys charge when you have both pieces on-site with a single operator? Got asked to bid on one of those akward jobs where I need about 1/2 a day of skidsteer time and 1/2 a day of excavator time, and I'm not set up to haul both machines to the jobsite in one shot. Maybe I would be better off renting a compact backhoe?

The job involves:
demo half of a concrete patio (about 10' x 15' to be removed)
excavate for a house addition - crawlspace only (15' x 24' x 40")
prepare a pad for a new garage (20' x 35') and driveway approach
excavate footers for new garage (40" deep)

All the dirt goes across the backyard and over the hill.

I've done work for this guy in the past, and I feel he'll keep giving me work in the future, but I don't want to be working for free!!!

Joe

 

[CascadeScaper]

Can you have both the skid steer and excavator on site at the same time? I've done a couple jobs like this where I used half and half. The thing is, when I was doing one job, I just estimated the time I would need with our excavator and how much time I would need with the skid steer. I came out pretty close with what I had estimated. If all else fails, you could split the difference between your hourly rates to give an estimate. We charge $70 an hour for the skidsteer and $90 an hour for the excavator, so I figured the job would take me 8 hours at $80 an hour, averaging the difference between the 2. I've done this once and it worked well, we made money on it.

 

[atgreene]

I would estimate it as a flat rate for the job, rather than by the hour for each piece. I find I do better work by the job, as I'm not rushing to keep my hours down and I know what I'm making for the day.

If he insists on hourly, then what I have done in the past is charge the hours for each machine plus moving costs for both plus materials. Either way, you're tying-up an entire day there and need to bill for it.

Things like silt fence, grade stakes, marking paint, flagging tape and marking for utilities need to be billed somewhere. When someone askes me for hourly rates, I explain that that hourly rate does not include extras like the aforementioned materials. Most people realize that a daily rate is a better deal, once you educate them.

Good luck.

 

[nobull1]

All jobs are different and priced accordingly. What I usually do is try to charge 50% for the second piece of equipment for the time both are on the job. If someone questions that price I just remind him/her that If I didn't have the equipment we would have to get someone to bring the other piece of equipment on to the site and then pay both of us. Obviously this is only for hourly paid work. Most people think this is a good deal and pay the price without question.

 

[dayexco]

you all should know your daily/hourly cost of operation per piece of equipment. price it out accordingly. can't make money on it? move on to the next one

 

[digger242j]

you all should know your daily/hourly cost of operation per piece of equipment.

I won't argue against that, but I think Joe's asking very a different question.

If one piece is sitting idle while you're operating the other, how much is it fair to charge the customer for the idle piece? If it were sitting at your yard, you'd be getting nothing, but it wouldn't be costing you anything, as far as direct operating expenses. Whatever overhead there is attached to the second piece, you'd incur whether it was sitting idle in the yard, or at the customer's site. So, back the the original question.

I don't think you're working for free if you're only charging for the machine that's running, but on the other hand, what if you had to rent both machines? The rental yard doesn't care if you're only on one at a time--they want paid for all the time you have it/them out. Plus delivery and pickup for each.

It's more of a "customer relations" question than an "equipment cost" question.

By extension, I've often wondered how big jobs are priced out. If a contractor puts a whole fleet of equipment on the site, but is using only a half or 3/4 of it at any given time, (because different phases of the job require different pieces), how do they figure their cost for the total job, and incorporate it into a bid?

 

[atgreene]

The issue is this: Whatever you are charging, it covers both pieces of equipment anyway. Your daily rate has to cover the bills for the business, regardless of what you are doing. If your second piece sits for a month while the primary is working, you still have to pay the bill for it.

You really need to charge by the job, just for this reason. Don't be afraid to lose a job because you're higher priced than the little guy starting out with less overhead. It's better to be known as expensive but dependable and capable of quality work, rather than a lowballer. If a customer is so tight as to want to know the cost of everything and have control over how the job is done, to the point that your working for him by the minute, it's time to tell them they need to find someone else.

In our maple syrup business, my father has always said "If no one complains about our price, we're too cheap".

 

[Squizzy246B]

We run the Ex and the skid together on lots of job. Often the rate is contained within a larger job and it depends on the job. If we are doing machine work only they are charged out at hourly rate when they work. If its only one operator and two machines they get charged according to use plus a mob-demob cost. (normally an hour).

 

[digger242j]

The issue is this: Whatever you are charging, it covers both pieces of equipment anyway. Your daily rate has to cover the bills for the business, regardless of what you are doing. If your second piece sits for a month while the primary is working, you still have to pay the bill for it.

Atgreene, I'm gonna play the devil's advocate...

My name is Mr. Customer, and I don't care whether you've got one machine or a dozen sitting idle in your yard, You've only got this one here working for me, and that's all I'm paying for!

"If no one complains about our price, we're too cheap".

There is a lot of sense in that. I recall having read someplace that if you're getting more than 1/3 of the jobs you bid, your prices are too low.

 

[Electra_Glide]

Thanks for the replies...here's some additional comments...

Digger's first reply is spot-on as far as understanding the question I'm asking.

I intend to bid a fixed-price for the job. In fact, that's what the builder has asked for. This job is just digging, nothing more. There's not way to contain the equipment costs inside a larger bid. Machine time only.

I know exactly what my hourly costs will be since I'll be renting both pieces. I will be discussing the job with the local Bobcat rental guy to try to work out something. He has treated me well in the past.

I am the little guy. This is only my second season, and last year didn't really get going until the summer. This is my first solid lead within the local construction market. I worked for him once last year, and I feel I'm still in the "customer acquisition" phase with him. I'm trying to develop this relationship to a point where I can be doing more profitable work with him, but right now he's only interested in me doing digging.

I am not a lowballer, but still need to compete in the local market. Going rate around here seems to be $75-$85/hr. for this type of work. I'm still trying to make contacts and get myself established. I don't like to lose bids, but I've lost my fair share. I need to go back and look at how close I am to Digger's 33% comment...

Thanks for all the replies so far, and keep them coming.

Joe

 

[jmac]

We price our jobs by the job, based on how long I think it will take to do. My math is this, how long by the day. That day could be 6-10 hours depending on the job. All jobs take at least full day for MOB and completion and end on a full day even if we spend a 1/2 day on the last day. Our day price is $1000. plus materials. This includes all my equipment needed for that day to include dozer, mini, mid size excavator, skid steer, dump truck and two peolpe. I always add a little extra for buffer on larger jobs that are longer than 4 days. All of the other guys are are at least $1000 per day and most are $1500. The only hourly I do is sub work for GC's or change orders on a already quoted site work job at $150 for dozer or excavator and MOB if needed. The point is this, quote the job not the hours. Know what the job is worth and stick to that and hope you get done quicker than you planned. By hours could also be used if it is impossible to price out because of the need to wait for other sub's to get done and you equipment has to stay on site waiting on plumbers, eletricial etc. Try quoting a three month job for site wotk off a set of prints LOL the same math applies but by the month now, not the day plus materials. And then again some times when things are slow I do what it takes to keep your equipment moving no matter how low I have to go. Like in December!
John

 

[jmac]

Eletraglid you said that you have lost your share of jobs, this is because you have to rent. Buy as soon as possible. It is very hard to be competitive on small 1-3 day jobs renting. What happens if you have to go back for a half day next week because of rain on you pay for a day rental and machine sits for a day but you need it the day after next. The guys that own the equipment can beat your price ever time if they want to. Go to an auction and buy a skid steer, dump trailer and pick up that will get you started cost you about 25K and you are on your way. Just to hard to rent. Most of the time you can put your rental towards purchase of machine at the end of the summer ask your dealer.

 

[Electra_Glide]

Eletraglide you said that you have lost your share of jobs, this is because you have to rent. Buy as soon as possible. It is very hard to be competitive on small 1-3 day jobs renting.

Jmac,

I agree with you 100%, but it's tought for me to justify the investment given the current workload. I've kinda decided that 2006 has to be the year where I generate enough leads and jobs to justify the investment, or hang it up...

Go to an auction and buy a skid steer, dump trailer and pick up that will get you started cost you about 25K and you are on your way.

Hmmm...there is that money saved up for the kids to go to college...:nono

Take care...

Joe

 

[jmac]

You can't sit on the fence, you are in or you are out!
The other guy is in 100% and how can you compete with that. No buisness can make if if you do not make the investment!
John