Dougster

It is a sad irony of life that the best bargains are often out there when you have the least money available and the most risk to incur going after them. My GF are finding this in real estate as much as I am finding it in used digging machinery. And while there are plenty of folks out there screaming no work and how the poor business climate is killing their businesses... the asking prices for the equipment they want to unload is often surprisingly high. Many of these folks have loans on the equipment and are upside-down on their equity and/or behind in their payments. They are looking for the proverbial "Hail Mary Pass" and a guy like me to come along who has maybe not done enough homework. Fortunately, this "hopeful owner" situation is not seen at the local "unreserved" auctions.

In terms of partnerships, it does not help me to partner with a guy with similar equipment unless a job comes up that is too big for me to handle alone (and in this regard, I do maintain certain non-competitive business relationships). But the fact is, I am looking for just the opposite: A guy who doesn't have equipment who needs to partner with someone who does have the equipment. In fact, I have found a couple such smaller organizations and am very hopeful they will bring me some good work this season.

This current business climate is awfully scary. I am trying to think when I have seen so much raw, unrestrained pessimism before and it is hard for me to come up with similar "sky is falling" circumstances in my lifetime. On the other hand, I don't think anyone is expecting this to last forever or even for a very long time. My timing has never been all that great... and here I find myself struggling hard to survive against all odds. The smartest thing to do right now might be to do nothing... or at least the minimum to get through this coming digging season with the least amount of equipment expenditures.

Dougster

Dougster

Finally got a chance to look at a bunch of used mini-excavators today from a guy who claims to have bought them all recently down in Florida. Supposedly, used Florida machines are better 'cause there is more easy diggin' sand and less rock. Unfortunately, this rather interesting and varied group of machines were absolutely beat to high heaven. It's always fascinating to me how good a machine can look in pictures vs. how bad it can look in person.

This extremely beat-up group of mini's was so bad that it had me rethinking the whole used mini-ex vs. used full-sized backhoe debate all over again. For equal age and equal operating hour machines, the full-size backhoes seem a lot less damaged and in a lot better condition overall than their mini-ex brothers.

Has anyone else noticed that? My working theory is that mini-ex's are far more delicate and therefore more easily damaged. It may also be that mini-ex's are inherently called upon to work more often in very tight quarters... something that could also lend itself to greater potential for damage.

Hmmmmmmm...

Dougster

Ducati996

I was just looking closely at a New Holland Mini Ex model E30/E35 series.
It was new but the zero % is a good thing - I really liked them. Also Like the Kubota KX90 series too. Its hard to find good condition used machines, however I feel this year above all other recent years, you might score some deals -

SkunkWerX

Just a wild guess, maybe the mini's are entrusted to not-quite-operators, where the larger construction ho's are the realm of the serious operators. i don't know this, just a possibility.

Similar to looking for used BobCats/skidsteers. They run a good deal of money if they are in good shape, but there are tons of beat-to-heck models out there.

So, yes, Dougster, I have noticed what you are saying, it is a real dilemma.

In mini-Xs it's liek settle for a junker at lower cost, or mgiht as well buy new or near new and pay the hefty fee.

It's fun to look, but I don't envy your decision step, given what's out there on the used market.

Kubota BX2350 and more attachments than I have sense to operate.

Kennyd

There are better units out there...But one other aspect of all this is transportation. What equipment do you have to move these machines with? A full sized backhoe requires a lot more truck/trailer to move than a mini-ex.

John Deere 4110HST
FEL, MMM, FEL Forks (homemade),I-Match, Ballast Box, #380 plow (modified to fit) Markham LD-48 Grapple, and lots of other STUFF.

PaulChristenson

Massive foreclosures in Massachusetts; up a stunning 600% over 2005




January 23, 2008 ·


We’ve heard a lot about the Southwest, California and Florida lately. But the collapse of credit, wealth and homeownership is no doubt occurring throughout the United States. Case in point: Massachusetts. There, the number of foreclosures in 2007 was 600% higher than in 2005. And 150% more than 2006.


BOSTON–(BUSINESS WIRE)–Foreclosure deeds in Massachusetts more than doubled in 2007 when compared to 2006, and were up seven times the number of foreclosures in 2005, according to The Warren Group, publisher of Banker & Tradesman.
“The rise in foreclosure deeds fell off a little bit in October and November, but rose more than 100 percent again in December, a clear signal that this problem is far from over,” said Timothy Warren Jr., CEO of The Warren Group.
There were 7,653 foreclosure deeds in 2007, up 148 percent from the 3,086 in 2006, and up 600 percent from 1,092 in 2005. During the month of December, deeds rose 136.3 percent to 683 from the 289 filed in December 2006.
Auction announcements rose 119.3 percent from 6,659 in 2006 to 14,604 in 2007. Last year, they were up 216.1 percent from the 4,620 filed in 2005. In December, auction announcements increased 66 percent from 661 in December 2006 to 1,097 in 2007.
“Although foreclosures rose substantially over 2006 numbers, the severity of the problem becomes even more obvious when 2007 is compared with 2005, and we see that foreclosure deeds rose 600 percent,” Warren said. “Many more people will lose their homes in 2008, and regulators, mortgage lenders and lawmakers need to continue to find solutions to the problem.”
The historic leverage unwind continues as paper wealth disintegrates.

How does this affect your business projections for this year???

Paul in VT

I used to own an ant farm but had to give it up. I couldn't find tractors small enough to fit it.
-- Steven Wright

Dougster

I sure hope you are right. With essentially no outside income and the business still operating at a net loss, no one will finance anything for me right now. Anything I buy will come out of savings (read: borrowed home equity) and it will likely have to be a used/leftover/distressed sale machine. That's the world I live in right now.

The New Hollands are fine machines. Very few are showing up in the used market right now. One slight problem: The E30 is near perfect in terms of digging power and transport weight, but falls slightly short of my needed 10-foot (min) digging depth. The E35 meets that 10-foot goal, but kicks the transport weight up to the point where it is marginally illegal on my current 10K equipment trailer. Still, if either one became available "slightly used" at a price I could justify, I would have to give them very serious thought!

I have not come across a Kubota KX90 (an older version?)... but the current KX91-2/-3 is a magnificent machine. While slightly lower in specified bucket digging force than the New Hollands, the Kubota KX91-3 would likely be my first choice in a new machine (complete with cab, thumb and angling blade) if I suddenly were to win the PowerBall lottery.

Dougster

Dougster

Once again Skunk, you have hit the nail right on the head. Too many of these used mini-ex's are coming out of the daily/consumer rental market while the big hoes are not. The big hoes tends to have been owned by legitimate excavation/construction companies and run by better trained/experienced operators. So in a sense, I am looking for the proverbial "needle in a haystack"... i.e., a 3.5 metric ton mini-ex that happened to have been owned by an excavation company or private party... and yet find it at a relative bargain price. Obviously, this will not be so easy.

Dougster

Dougster

The beauty of the full-size backhoe is that most can be efficiently "roaded" to jobsites within maybe 10-15 miles. This requires annual insurance, registration and excise taxes, of course... plus I'm told there is a significant tire "wear and tear" factor/cost. The backhoe must also meet certain state requirements (windshield, travel speed, lighting, etc.) and be on a state list of approved roadable machines. It is not a simple, nor cheap endeavor.

Beyond some point, professional transport to/from jobsites would be required. The job would have to be profitable enough to justify that added time, complexity and cost. At this point, there is no way for me to tell which option (mini-ex vs. full-size hoe) could net me more money... this coming season or overall.

Dougster

Dougster

Now Paul... there you go scaring me half to death again! You are like a little man that stands on my shoulder and whispers scary things into my ear!

Yes, I am very concerned about the crazy business climate and how it might affect this spring and summer's business. Right now, it is still too early for me to tell. I am getting the usual sprinkle of early inquiries, but I'm still weeks away from any serious start to digging season. April will tell the story. That's when the serious requests for quotes usually start in earnest. Unfortunately, I can't wait that long to make a decision re: mini-ex vs. full-size hoe vs. mods & upgrades to my current machine.

Dougster