Starting my own contracting business

Fendt516profi said:

How would any genuine people feel if they gave a new lad a go and he asked for a deposit or to be payed in full before he left the farm

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Thats it really, in any other scenario, try getting a new supplier to let you have anything without at least a substantial deposit and see how you get on.

Sometimes even see how it goes with people you already know and have done business with. A few years back I asked someone for a quote for some joinery work, not only was the price high, but he wanted 100% paid up front. Not only was his business directly opposite us, but we had given his Dad £3k worth of credit the previous year and had known the family for 30 or so years. His wife even rang us up on the assumption that we would be accepting the quote and asked where our cheque was !!!

Munkul said:

Have you ever heard the saying "pick your customers, or your customers will pick you instead"?
Meaning that to be a successful business, you have to try and steer it towards the good customers that you want to work for, and avoid the bad ones as much as possible.
Get bills out promptly, whatever, and put a 30 day payment term on. Any good customer will pay promptly, and anyone who hasn't paid within 30 days... will at least be on your radar for next time...
I could not understand our silage contractor last year... we asked him for a bill after 1st cut... nothing. Then after 2nd cut... nothing. Then after 3rd cut and wholecrop, he stings us for the whole lot, in October which was quite painful and NOT when we wanted money going out.

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There must be some form of fever attached to grass that prevents invoicing, our Parish Council has had terrible problems over the years getting monthly invoices from grass cutting contractors, they all seem to prefer to just send one invoice in November. Not only does it give a false impression of the account balances for months on end, but unless your record keeping is 100% its virtually impossible to know in November what was done in March.

There's a good Farmflix video of a young fella in his 20's from Scotland who went out on his own recently without family backing, worth a watch. You'll need a subscription though to watch it

If it was me, I would go for a niche market that not many other contractors are doing and build yourself up slowly from there.

I know a local contractor (one man and tractor) to me who specialises in sub soiling and direct drilling grass seed, he gets the lying share of work in a 30 mile radius as most other contractors are too busy at silage/slurry/tillage to be geared up for these two jobs.

If I was starting on my own I think I would go out on my own with a digger, at least you will get it out working 12 months a year and can work in both Ag and Construciton

Good luck!

Bongodog said:

Thats it really, in any other scenario, try getting a new supplier to let you have anything without at least a substantial deposit and see how you get on.

Sometimes even see how it goes with people you already know and have done business with. A few years back I asked someone for a quote for some joinery work, not only was the price high, but he wanted 100% paid up front. Not only was his business directly opposite us, but we had given his Dad £3k worth of credit the previous year and had known the family for 30 or so years. His wife even rang us up on the assumption that we would be accepting the quote and asked where our cheque was !!!

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How many people will of stung him for bespoke joinery and cancelled there order when it was nearly complete. Them just becomes policy, no friends in business

Munkul said:

Have you ever heard the saying "pick your customers, or your customers will pick you instead"?
Meaning that to be a successful business, you have to try and steer it towards the good customers that you want to work for, and avoid the bad ones as much as possible.
Get bills out promptly, whatever, and put a 30 day payment term on. Any good customer will pay promptly, and anyone who hasn't paid within 30 days... will at least be on your radar for next time...
I could not understand our silage contractor last year... we asked him for a bill after 1st cut... nothing. Then after 2nd cut... nothing. Then after 3rd cut and wholecrop, he stings us for the whole lot, in October which was quite painful and NOT when we wanted money going out.

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Ask me for a bill and you'll get one but if you don't and it's not a serious amount you will probably get just one for year at end of season. Not ideal but did you not know how many acres you've chopped per cut and how much £ acre and leave the money set aside. I understand what you mean you want to pay when money's coming in over winter people just tick over

Fendt516profi said:

Ask me for a bill and you'll get one but if you don't and it's not a serious amount you will probably get just one for year at end of season. Not ideal but did you not know how many acres you've chopped per cut and how much £ acre and leave the money set aside. I understand what you mean you want to pay when money's coming in over winter people just tick over

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Yes there's that side of things... but money sitting in the bank when you're buying sheep in the back end... it gets spent
Total bill was less than £10k but we're a smaller farm, £10k isn't loose change.
Just saying, a good contractor will send bills promptly, and a good customer will pay promptly.

If you have energy, enthusiasm and drive, then of course you can succeed.

However, like all good businesses, the devil is in the detail.

Basics: is there a demand for my product/service ? How big is the demand ? What will it cost me to get started ? What will it cost me to keep going ? How much profit will I make ?

You need a detailed business plan of how you will progress and grow you're business for at least three years, and how you will fund it.

This must include cash flow projections based on reasonable work-rate expectations, how growth will be achieved, and at what rate.

So, allot of research is needed, as well as maybe some outside help with the business plan.

If you are young, and this is a new business there will be some help and support out there to get you started, that is the place to start your journey.

Good luck.

I would look at the amenity groundscare sector, start off small, supplement with labour only jobs and build it up, large houses, equestrian, schools, sports clubs, village contracts, churches, industrial buildings plenty to go at I think easy £20 hr with just a petrol hedge trimmer in your hand in winter. Move on to grass cutting(multiple cuts per season. Weed control, aeration, bit of tree work, fencing etc

BRC has given excellent advice. Have your foot in multiple markets to avoid dips and troughs! Also be respectful when it comes to getting new work. Contracts such as village fields and church yards are often done at reduced prices by local companies to support their local area.

Munkul said:

Have you ever heard the saying "pick your customers, or your customers will pick you instead"?
Meaning that to be a successful business, you have to try and steer it towards the good customers that you want to work for, and avoid the bad ones as much as possible.
Get bills out promptly, whatever, and put a 30 day payment term on. Any good customer will pay promptly, and anyone who hasn't paid within 30 days... will at least be on your radar for next time...
I could not understand our silage contractor last year... we asked him for a bill after 1st cut... nothing. Then after 2nd cut... nothing. Then after 3rd cut and wholecrop, he stings us for the whole lot, in October which was quite painful and NOT when we wanted money going out.

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I remember hearing about one farmer in Shropshire that my mate did work for......if you didn't send a bill out fairly sharpish..... Can't remember the length of time....he would send the money out to you what he thought the job was worth....sometimes more..... Sometimes less. ...dont ask me how the invoice worked it never heard of anything like that before or since......was a few years ago now......

Munkul said:

Have you ever heard the saying "pick your customers, or your customers will pick you instead"?
Meaning that to be a successful business, you have to try and steer it towards the good customers that you want to work for, and avoid the bad ones as much as possible.
Get bills out promptly, whatever, and put a 30 day payment term on. Any good customer will pay promptly, and anyone who hasn't paid within 30 days... will at least be on your radar for next time...
I could not understand our silage contractor last year... we asked him for a bill after 1st cut... nothing. Then after 2nd cut... nothing. Then after 3rd cut and wholecrop, he stings us for the whole lot, in October which was quite painful and NOT when we wanted money going out.

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He may be a great machinery man but he's a lousy businessman. If someone asks for a bill they should get it immeadiately. There aren't many who do , so they ought to be well cared for IMO.

Could this thread be made a sticky at top of machinery section?

I don't know how many of these threads are started every year, with same advice from same people. ?

Chae1 said:

Could this thread be made a sticky at top of machinery section?

I don't know how many of these threads are started every year, with same advice from same people. ?

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I wonder how many actually do start and make a go of it?

Which part of the country are you based? I've done the same but I went self employed and was happy to go and sit on someone else's tractor aswell and work with livestock most of the winter, imo if you're gonna do it buy the best basic second hand kit you can afford but keep it basic and don't buy scrap, and have thought about maybe buying a digger or something and then also having a stable income for few months of the year on a veg job like driving a pea viner or driving a combine for someone, also of you're any good at mechanicing get a set of spanners and set of bearing pullers and make yourself known to as many local farmers as possible

Zebbedee said:

I wonder how many actually do start and make a go of it?

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Well, they all seem to disappear and never post again.

If I was a cynic I might suggest they were started by someone else to create traffic.

There was a chap Aaron and his mum who followed up after asking questions. Which was good. Think a tff member went to help and never returned!

Buy a mini digger.

Munkul said:

Have you ever heard the saying "pick your customers, or your customers will pick you instead"?
Meaning that to be a successful business, you have to try and steer it towards the good customers that you want to work for, and avoid the bad ones as much as possible.
Get bills out promptly, whatever, and put a 30 day payment term on. Any good customer will pay promptly, and anyone who hasn't paid within 30 days... will at least be on your radar for next time...
I could not understand our silage contractor last year... we asked him for a bill after 1st cut... nothing. Then after 2nd cut... nothing. Then after 3rd cut and wholecrop, he stings us for the whole lot, in October which was quite painful and NOT when we wanted money going out.

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I dont mean to be smart but there is nothing stopping you from throwing him 2 or 3 grand after each cut to make it smaller

im not from farming back ground at all, but from an early age I was obsessed with tractors...… from being 8 yrs old I went after school to mess about on the dairy farm in the village I grew up in.... left school and worked there on what was then the YTS scheme...., this farmer told me that there was a better living doing something else, so persuaded me to go and work for a local firm making and erecting farm buildings....learned how to weld and fabricate but it wasn't for me.... then a job came up with a local contractor.... had 8 years of long hours, plenty of right royal bollockins...but learnt the skills I needed..... in 1994 I bought a 956xl and small square baler and off I went, borrowed a plough, bought knackered maschio power harrow and bodged it up and sat a 3 mtr Fiona drill on the back and went drilling as well.... took the contract from old boss for spreading liquid fert for chafer and built that up to 10000 acres a year, all grassland work.....built the rest of the business off the back of that.... bought umbilical in 1996, bloody dirty shitty job but with no competion I was raking it in......fast forward 20 odd years..... 3 newish tractors, lexion combine, new jcb telescopic, 2 big square balers, round baler, househam self propelled sprayer,, two wrappers, mowers tedders rakes.....it goes on and on...…. oh, and weve just taken tenancy on another farm which brings us up to 700 arable acres farmed in house as well as the contracting.... if you want it bad enough you CAN DO IT, but its not an easy road, my divorce 6 yrs ago is testament to that, but the most rewarding thing for me is my 23 yr old son working with me in the business, like others have said, some days, most days, its the best , most rewarding job there is...…..but theres also those days where it all turns round and kicks you in the teeth... you'll soon learn how to pick yourself up, dust yourself down, and if you've got the balls, you go back tomorrow for some more

I started when I was 15 buying a Massey 3630 with a few problems my old man being a mechanic we soon sorted it, I passed my tractor test at 16 and starting doing odd bits of trailering ect for foke and used it for transport to general farm jobs then I brought a 2250 gal tanker a year or so later did a bit with that up and down then a contractor I worked for sold up so I brought a silage trailer few other lads did the same one the chopper and one a buckrake and away we went, since then I’ve brought two more tractors umbilical pumping kit and loads of other things works busy now and I work full time at contracting it’s taken a lot Of money and a lot of make do and mending of equipment to get what I’ve got now I’m very lucky to have a dad that’s helped me so much with fabrication of machinery and repairs of tractors, my best paying jobs are my sprayer flail mower and grassland subsoiling can work away on your own and hardly any competition around hear so I’d buy a good classic tractor (mf6290 tm155 ect) and a sprayer and a few bits like that and have a go