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arnoldir

Question on Labor Rate for Magnatrac

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UCD
Arnold: I'm not in the business, although my dad was, so I can appreciate some of what's involved. This may seem obvious, but when I want to price my labor on some odd job, I use subterfuge, (okay, I lie) and pretend to be a customer for the type of work contemplated. I would call a few construction and landscaping companies that service the markets you wish to penetrate, and pose as a customer. Then, compare the notes you took on these sources, and price yourself accordingly. If you get a good "vibe" from any of them that seemed busy, perhaps you might call back another day, as "yourself," and see if they would like to "sub" some of their "extra" work out to you, thereby getting into the market via referrals by the overloaded company, if you find one willing to "sub" to you. Heck, they might even drag your Magnatrac there and back for you, for a wholesale-priced fee. And Dutch, I'm thinking, will have more insight into this than many, of course. But hey, what do I know, I'm not self-employed. I AM very curious, however, about how it goes for you though, so I appreciate you keeping us all involved. Sincerely, Peter

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Brent_Baumer
Sell the "spoil" as top soil. That's what some of the $%#^'s do around here. Some call almost anything "topsoil". Seriously, if it is top soil it can be sold pretty easily. Brent

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Dutch
Roger, I suspect you’re going to be inundated with work for the Magnatrac. Hourly rates vary greatly by locale, economic conditions, competition, and sometimes season. Check with a larger local site work firm. Explain you don’t want to compete, just need their advice on the going hourly rate for your area. You may even pick up some unexpected work or referrals. Hourly rates are fine for some situations, but many jobs will require that you give a flat price. Experience will be the best teacher. You will have a problem giving quotes on the really small jobs. Whatever you decide for an hourly rate, have a minimum. A minimum is how to quote a 15 minute job where you have 2 hours travel, unload and reloading time. In those situations, let the homeowner be your salesman by lining up additional work on the block. It’s fair to everyone. What are “spoils”? Make a deal where you’re buying your new material to stockpile the surplus material removed. If the “spoils” are trash, get paid to haul and dispose of legally. Don’t forget the recycling market. Very little is actual trash if separated properly, or can be "processed" by mixing with new material.

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arnoldir
Guys, Can I get some advice on the going rates for small machine and operator. I'm trying to work up an hourly rate for the Magnatrac with backhoe. Also, any ideas on rates to haul away spoil from an excavation. Saturday I spread 20 yards of fill for a neighbor at $50 an hour, 2 hours total. Thanks in advance, I always appreciate input from you fine folks.

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Spyder
I agree with all the comments. However, this is a very complex question. From a business point of view, one would have to take all costs in the operation, that is, capital investment, maintenance, labor, transportation, and other indirect expenses. Then estimate when you want to recover your investment and have a positive return on the investment, by estimating how many hours it would take to do that. Example: If you invested say $10,000 and wanted to get in the black in 100 hours, then the price per hour is $100. But then you have to add a prorated amount for manintenance (the thing WILL break in 100 hours operation), $$$'s for your time as the operator, transportation, and any other identifiable indirect cost (phones, office, mail, advertising, etc). Also, you have to account for depreciation, insurance, bonding, etc. Someone pointed out that you will still have to make some adjustment for the particular job, maybe a rate per cubic yard, or a rate for a certain operation to take care of the firm fixed priced jobs. I am very interested in this endeavor too, may want to make a similar investment. Dave

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arnoldir
Thanks to all for your responses, particularly Dutch, nice to have you back in the game. Just to clarify some points, and provide insight for those considering a simmilar commitment. I got into this machine primarly to save my back and avoid the hassel of renting a machine for 4 hours ($135), every time I need to do a 15 minute job in my own yard. I figured that with a little care and feeding it would likely outlast me, the engine is rated for 5000 hours before overhaul. If I charge $50 per hour, it would take 600 hours to earn back the purchase price, that's only 12% of the machines projected life before overhaul. However I do expect sustaining costs, worn bushings, cut hoses, etc. Since I'm already cutting some grass and doing other light landscaping I'm going to need a trailer, might as well get a big dump trailer with tool boxes along the sides. This way I can carry tools, supplies, and attachments without messing up my suburban. I agree with Dutch about setting a minimum, I do that with my rototilling buisness. $35 to get me there and do 10x10, then each 100 sqft additional on a sliding scale. The more sqft the cheaper per 100. With the Magnatrac I'm thinking of $75 or $100 for the first hour including transport (up to 20 miles) and then $50 per after that. As to the term "Spoil" I'm using it to describe what is removed from an excavation site, around here it is a mix of sand and gravel. I know it can be sold as clean fill, but how do you guys handle pricing the removal. Happy tractoring guys.

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