# Excavator. Buy or...buy?



## drewsserviceco (Aug 1, 2014)

I bought a Deere 110 TLB last summer. 

The biggest hurdles I found:

Insurance-

my insurance co looks at what the machine is capable of digging for depth and anything more than 3 ft they consider you an excavating contractor. Puts you in a higher risk category which is higher premiums. They wanted something like $4K additional. 

Transportation-

With the weight of my machine I essentially need a CDL to move it. As I understand the law, it's based off of the rating of the trailer (even if you get pulled over and it's empty) anything over 10K lbs needs an A endorsement). This is regardless of tow vehicle. 

Maintenance-

Nothing on these things is cheap to repair. Add in a heavy equipment mechanic shop rate is over $100/hr and more if they come to you. 



What I thought was an easy move, just but the machine, snowballed into buying a machine and needing a trailer, tow vehicle, fuel transfer tank, special insurance etc. 

You almost have to buy a dump truck, because how many jobs don't require screenings or grit for backfill around what your installing. And who/how do you haul the spoils away?

It could be worked out with deliveries, but now you're relying on someone else which is what has you considering buying a machine in the first place.


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## Glock23gp (Mar 10, 2014)

drewsserviceco said:


> I bought a Deere 110 TLB last summer.
> 
> The biggest hurdles I found:
> 
> ...


All very good points thanks.

My trailer can haul 8k so that's my limit plus my van is just an E250 with a 5.4 so that's pushing it.

Also thought about the maintenance which you brought up and isn't a pleasant thought.

Insurance I had thought about but didn't consider the depth capable of digging as a factor. 

I really only need to go 3' for primary but the last walk behind ditch witch was such a pain (and only dug 2') and kept getting stuck on almost level ground because it rains 367 days a year here so it would be pointless to buy (plus no blade for backfill) Riding ones have their limitations too unfortunately and are not even available to rent here.

Just what I need is another insurance policy...

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## telsa (May 22, 2015)

The brutal reality is that an EC can't get enough utility ( time of use ) while being stuck with ALL of the insurance of a dude that's running the same gear 1,400 hours a year.

With your reduced usage, your troops are no where near as quick on the controls. Expect them to operate at 25% of j-man speed ( even yourself )... and to be much more prone to gaffs.


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## wildleg (Apr 12, 2009)

if you have the work to make it pay for itself in the first year it's a go.

if you are going to have it sitting around gathering dust, it is a huge waste of money.

as others said, you have to have one or two guys dedicated to doing the digging, so the machine stays frosty as well as the work, with as little collateral damage as possible (water lines, gas lines, other utility lines, etc). If you decide to buy it, buy a utility locater too, so the guys that are digging can check themselves, regardless of what the utility locator/miss utility marked out.

good luck with it if you go for it. A company I worked for bought a couple and those things were paid for after a few medium site/new work hotels.

I like the mini soft track excavators.


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## splatz (May 23, 2015)

I have seen it work out if you have can get some people to subcontract their trenching from you, even a handful of people giving you one job a year. But you're really getting into the ditchdigging business at that point. (I wonder if you'd be better off separating it formally from the main business...) 

If you're not very proficient with the machine you can probably 1099 someone that is and have it work out well for both of you.


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## drewsserviceco (Aug 1, 2014)

I could justify the expense of the machine with the amount of personal use it would get. For the business, it made sense to get it just for the fact of having pallet forks and being able to receive deliveries without a loading dock.

I had this fantasy that other electrical contractors would subcontract they're digging to me, and all I would have to do is show up and dig. Not that that is impossible, but not as easily found as I was hoping. As pointed out by others, it would have to be a significant amount of digging to justify the overhead of putting the machine to work.

I had this very conversation with my insurance agent stating that I would only be digging 3 foot because that is what the utility company requires for underground services. His response was that basically, they imagine an electrical contractor doing post lights and such, not having any grasp the idea of duct banks and other such installations. Plus needing a significant size machine to be efficient digging to a 3 foot depth with the soil conditions I have in my area, lots of shale and or stone.

I'm certainly not trying to talk you out of it, just advising of what the reality may be, if you can accept the expenses incurred it may be worth it, but I wouldn't count on it to be a significant boost to your bottom line. 

The more I learn and the more varied work I do, the more I realize everything costs money, and often it is the tertiary expenses that hurt the most, more than the sting of the original purchase price.


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## Cow (Jan 16, 2008)

Our shop bought a John Deere 35G about a year ago. Definitely in the top 3 tool purchases our shop has made.

It has been an absolute time saver when working projects. No more waiting for the diggers to get around to digging our ditches, you know after they're done with their projects, and the plumbers, and the.....

You get the point.

And like anything else, once we purchased it, none of us can understand how we went without for so long? It literally gets used several times a week by someone in our shop for a project.

If you can justify making the payments on it, meaning it actually pencils out, without just be being a "fun toy", go for it!

I know ours has already paid for itself, so it was a quick return on investment for us.


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## sbrn33 (Mar 15, 2007)

I have been contemplating this same thing. It will be my next purchase also. I want to get something vary small, maybe with expandable tracks to get thru a 48" gate for backyard services. I am a lot like you already have the trailer, and sometimes my little boxer 420 just doesn't cut it. I am not really even worried about payback or insurance because my insurance guy has already said it will not affect in one bit liability wise. 
I am thinking something like a Deere 17d or 27d. Mainly because I do work at our local JD. If not it will be a small Cat.


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## Lone Crapshooter (Nov 8, 2008)

Read a article many years ago in Electrical Contractor magazine about buying equipment and at that time it said that if you could not keep it busy 70% of the time you were better off to rent equipment. 
I want to say that was back in the late 70's when I had my business. A lot has changed sense then.

LC


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## MechanicalDVR (Dec 29, 2007)

Lone Crapshooter said:


> Read a article many years ago in Electrical Contractor magazine about buying equipment and at that time it said that if *you could not keep it busy 70% of the time you were better off to rent equipment.*
> I want to say that was back in the late 70's when I had my business. A lot has changed sense then.
> 
> LC


I couldn't agree more but it sounds like rental companies are not providing quality equipment.

I personally wouldn't pull the trigger on a machine unless it was going to earn it's keep on at least a monthly average.

If I had to I'd look to an auction for a decent deal.


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## MTW (Aug 28, 2013)

EC's in my area almost never own equipment like this. Trenching is subbed out or the equipment is rented. The numbers just don't work, nor is the hassle of owning equipment that needs constant maintenance and transportation justified.


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## MechanicalDVR (Dec 29, 2007)

A former BIL owned a fairly large EC company in NJ, his business was very top heavy with various equipment from large trucks to various tractor type equipment.

He had a yard guy and one or two mechanics on staff year round.

When I had a long talk with him about it he said that whole part of the business runs at a loss and that was how he liked to keep it foe tax purposes.


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## drsparky (Nov 13, 2008)

Another factor to consider...excavators are fun, biggest toy in the sandbox and you don't need to make sound effects.


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## Patriot1776 (May 20, 2016)

I'm not so proficient at running equipment, I can get the job done but it takes me a good bit longer than it would if I were trained to run it. Just a bit of advice; if you are going to run the equipment get proper training on it first. I think it makes sense to do your own digging work when you have the proper tools and training, whether you own or rent the equipment.

The company I work for tries to buy any equipment that they rent more than once a year. There are very few pieces of equipment that we rent anymore.


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## backstay (Feb 3, 2011)

I have a small 3 point hoe on my tractor. It's ok for smaller jobs. But if I'm going more than 100 feet or 5 feet deep, I rent. The second picture is the last one I rented, had to dig an eight foot hole and trench for a solar job. I probably rent 5 to 10 times a year.


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## MechanicalDVR (Dec 29, 2007)

backstay said:


> I have a small 3 point hoe on my tractor. It's ok for smaller jobs. But if I'm going more than 100 feet or 5 feet deep, I rent. The second picture is the last one I rented, had to dig an eight foot hole and trench for a solar job. I probably rent 5 to 10 times a year.


Why limit the hoe to 100'?


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## backstay (Feb 3, 2011)

MechanicalDVR said:


> Why limit the hoe to 100'?


The 3 point is slower to dig because you have to move to the tractor seat, release the break, put it in gear. Then reverse that every 4 feet. Plus it's not near as friendly for backfilling.


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## MechanicalDVR (Dec 29, 2007)

backstay said:


> The 3 point is slower to dig because you have to move to the tractor seat, release the break, put it in gear. Then reverse that every 4 feet. Plus it's not near as friendly for backfilling.


Thanks, now I understand.


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## Glock23gp (Mar 10, 2014)

backstay said:


> I have a small 3 point hoe on my tractor. It's ok for smaller jobs. But if I'm going more than 100 feet or 5 feet deep, I rent. The second picture is the last one I rented, had to dig an eight foot hole and trench for a solar job. I probably rent 5 to 10 times a year.


Ya tractor or backhoe wouldn't serve my needs due to the outriggers. Used a friends mini hoe tonight to teardown a shed and do some limbing on a house I'm buying. 

Love them they are so handy.

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