Debt to profit ratios

[RyanCafferky]

Last year my business went into significant debt for the first time. I bought a brand new chip truck and this year I bought a really nice used chipper. Before purchasing I talked with my accountant and asked for his suggestions. Both times he suggested keeping cash on hand rather than doing big down payments. But he also knew some of my personal goals as well as the business trajectory. Now we are looking into swing loaders and once again have a meeting scheduled to discuss financing and down payment options. Having a good accountant you trust to help make critical decisions is one of the most valuable things in my experience. Financing good equipment has changed my life completely. I went from being a contract climber commuting 90 minutes plus each way to running my own business in my own market. Quality of life went WAY up. I couldn't have made that step in the way I wanted to (big functional equipment) without going into debt.

 

[Serf Life]

^ Nailed it. More money in the bank makes way more sense than paying aggressively and putting lots down. Medical bills, slump in work, injuries, equipment downtime etc, the possibility of unforeseen expenses is always present. There’s a reason rich people get loans even though they have the liquid funds.

 

[southsoundtree]

I went dump trailer pricing today.

I looked at a 7x14 14k, downrateable to 10k. Powder coated, ramps, tarp kit, $12k.
Maybe/ probably would would require my FSuperduty (basically F450 dually), or my F600 chip truck. Not sure how i feel about that.



A 6x12 10k maybe better suited to my daily driver/ equipment truck f350 srw, gasser. Maybe easier since i largely roll solo.


Maybe derated 14k trailer are more for hardwood belt folks.




Oh yeah, between battery shopping, trailer window shopping, and a consult/ bid, I topped my neighbor's last poplar leader, chunked it down and pulled over the spar.

 

[flushcut]

A down rated trailer is nice but easy to over load. If you will never use the plated capacity the trailer will last longer.

 

[Fivepoints]

You may have more payload with the 10k trailer instead of the downrated 14k. Most 14k dump trailers weigh around 4k empty. Downrated will leave you about 6k payload. Fill it full of oak logs and itll be overloaded. Pine and fur should be fine. I know you mentoned ramps. You can use them for equipment but it generally sucks tying stuff down in them.

 

[ATH]

I went dump trailer pricing today.

I looked at a 7x14 14k, downrateable to 10k. Powder coated, ramps, tarp kit, $12k.
Maybe/ probably would would require my FSuperduty (basically F450 dually), or my F600 chip truck. Not sure how i feel about that.

A 6x12 10k maybe better suited to my daily driver/ equipment truck f350 srw, gasser. Maybe easier since i largely roll solo.

My F250 can pull 14K. I don't want it to...but by the tag it could.

What are you wanting to put in it? Logs? Probably gonna struggle to stay under 10K.

I've looked for a 7x14 trailer that is built lighter than a true 14K trailer (imagine this would be Al). I want the extra space for brush, but don't need the weight capacity. Haven't found a good option yet.

 

[Jehinten]

I went dump trailer pricing today.

I looked at a 7x14 14k, downrateable to 10k. Powder coated, ramps, tarp kit, $12k.
Maybe/ probably would would require my FSuperduty (basically F450 dually), or my F600 chip truck. Not sure how i feel about that.



A 6x12 10k maybe better suited to my daily driver/ equipment truck f350 srw, gasser. Maybe easier since i largely roll solo.


Maybe derated 14k trailer are more for hardwood belt folks.




Oh yeah, between battery shopping, trailer window shopping, and a consult/ bid, I topped my neighbor's last poplar leader, chunked it down and pulled over the spar.



View attachment 82283View attachment 82282

I have an older f350 dually with a 351 that pulls a 14' with no problem while loaded with tools and a mini on the truck bed. And admittedly sometimes the trailer is overloaded.

The biggest issue I have found is how easily I get stuck off road, but that's more of an issue of it only being 2 wheel drive.

Assuming you have a trailer brake controller on your truck, you shouldn't have any problems towing or stopping a 14 footer.

As others have mentioned, depending on trailer weight, if your going to get it derated a 12' or 10' trailer might have more capacity for logs and chips. For brush hauling I'd stick with as big of a trailer bed as you can get.

 

[Serf Life]

My 10k 12’ u-dump is 3k empty and over 6yrs old. No issues and it has been used quite hard. More overloading of gravel for home projects than transporting wood.

 

[Stumpsprouts]

Another option that I’ve been into is having someone with a log truck on hand for those jobs when there’s oodles of logs to load and transport. A pile of logs might require 3 trips with a 12’ trailer, plus time loading with mini- whereas a logging knuckle boom truck could load them all in one go. As I have priced it out, it’s significantly cheaper just based on labor costs alone. And doesn’t take into account the money you save by not throwing down for a large dump trailer.

 

[southsoundtree]

I hear that.

Input is always appreciated.



I have a friend with a kboom and grapple. He's 75 and keeps talking about selling the truck. I don't want it.

Keeping my own schedule is simplest.

If i get the dump trailer, I'll maybe sell my Forestry body chip truck with insurance payments, licensing and Gross Weight expenses.


I've got a Prevailing Wage job out on bid that I will do solo, if i get it.

 

[Serf Life]

Another option that I’ve been into is having someone with a log truck on hand for those jobs when there’s oodles of logs to load and transport. A pile of logs might require 3 trips with a 12’ trailer, plus time loading with mini- whereas a logging knuckle boom truck could load them all in one go. As I have priced it out, it’s significantly cheaper just based on labor costs alone. And doesn’t take into account the money you save by not throwing down for a large dump trailer.

We had a job last summer ~30min away which piled up about a pulp truck and a half of maple and pine, paid my trucker to bring the maple to my house and take away the pine: $350. Easy math there

 

[Reach]

I went dump trailer pricing today.

I looked at a 7x14 14k, downrateable to 10k. Powder coated, ramps, tarp kit, $12k.
Maybe/ probably would would require my FSuperduty (basically F450 dually), or my F600 chip truck. Not sure how i feel about that.



A 6x12 10k maybe better suited to my daily driver/ equipment truck f350 srw, gasser. Maybe easier since i largely roll solo.


Maybe derated 14k trailer are more for hardwood belt folks.

There’s a used aluminum dump trailer on Craigslist near here, might be what you’re looking for. https://lancaster.craigslist.org/tro/d/landisville-dump-trailer-aluminum-7x/7491271632.html

 

[southsoundtree]

That's really nice, and the price is right. Wrong side of the country.

Thanks.

 

[owScott]

Last year my business went into significant debt for the first time. I bought a brand new chip truck and this year I bought a really nice used chipper. Before purchasing I talked with my accountant and asked for his suggestions. Both times he suggested keeping cash on hand rather than doing big down payments. But he also knew some of my personal goals as well as the business trajectory. Now we are looking into swing loaders and once again have a meeting scheduled to discuss financing and down payment options. Having a good accountant you trust to help make critical decisions is one of the most valuable things in my experience. Financing good equipment has changed my life completely. I went from being a contract climber commuting 90 minutes plus each way to running my own business in my own market. Quality of life went WAY up. I couldn't have made that step in the way I wanted to (big functional equipment) without going into debt.

I agree with everything you just said. You will not be in debt long. I hear people say they will not buy on credit and will save the money to buy the equipment. You will get to the $ amount needed for the equipment way quicker using the equipment to get there. Smart business people manage credit, debt and how much cash they hold wisely. I have equipment debt and the cash to pay it all off and then some but if the interest is low why. Good for you, happy to see that you turned that corner.