How to Run a Backhoe Business
Before new construction can begin in an area, heavy equipment machines, such as bulldozers and backhoes, must prepare the site for the building. This requires removing debris such as trees, shrubs and grass and leveling the land to accommodate the size and shape of the building. Backhoes are perfect machines to perform this work because the digger can unearth debris and dirt while the front loader can remove it and help level the land. In fact, you can create an entire company around this one machine if you know how to run a backhoe business.
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Instructions
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Find funding for your backhoe business. The start-up cost for a backhoe business can be expensive, especially if you plan to purchase backhoes rather than lease them. John Deere and Caterpillar are just two of several manufacturers that sell backhoes, but even their most basic model costs more than $50,000. You'll need to obtain funding through loans or private donors to get your business started.
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Lease or purchase backhoes. You need to determine whether leasing or purchasing backhoes is right for your business. Leasing ensures that you are up to date with the latest equipment and tools in the field. However, by purchasing equipment, you can continue to use it even after you have paid it off.
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Obtain insurance to cover backhoes and your business. Although you don't need vehicle liability insurance because you won't be driving the equipment on the road, you do need property insurance to cover the equipment in case it is damaged as a result of a natural disaster. You also need to purchase general liability insurance for your business to cover you in the event someone is injured on a site where your backhoes are working.
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Register your backhoe business. Your business needs to be registered with the IRS and your state department of revenue. You may need to obtain a contractor or subcontractor license from your state or local government to operate a commercial backhoe business in your area. You can check with the professional licensing division in your state or city hall at the local level to determine if there are laws requiring you to obtain a license.
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Purchase or lease hauling equipment. Once you complete work at a specific location, you need to move your backhoes using semis with flatbed trailers. This type of equipment can be leased or purchased, or you can choose to contract with a hauling company to move the equipment for you. ust remember that if you own or lease, you need to have someone with a commercial driver's license (CDL) to drive the semis.
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Determine pricing for services. The money you are making from using your backhoe needs to cover your expenses as well as provide you with a profit on which your business can grow. By determining the approximate amount of money you need each month to cover your expenses, you can then determine how much you need to charge per job.
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Hire operators and other employees. As your business grows and you begin operating more than one backhoe, you want to hire additional operators to run the backhoes. It may also be beneficial to hire office staff to manage the business aspects of your company as well as a diesel mechanic to service and repair your backhoes.
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Promote your backhoe business. Most people don't need backhoe services, so general advertising and marketing won't be effective for your backhoe business. Instead, focus on networking with general construction contractors and other companies that have a need for backhoes.
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