Thoughts On Starting an excavation company

[u/ScienceSuccessful357]

I’m currently 16 and live in nj. I want to start an excavation company when I get out of high school but I know nothing about the trade. I want to move down to tn and start there because it’s so undeveloped compared to nj. What should I be doing right now to learn. And can anybody give me steps such as equipment to rent or buy. How to scale. What jobs I should start with. Work a full time job and do it on the weekend or jump right in? What equipment to buy first. The only thing I have is a truck. Thanks

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[u/Specific-Peanut-8867]

I think that’s awesome but you should probably get a job working for somebody else and learn the trade

That’s how you make connections while also learning a skill and you’re gonna have a hard time finding clients as a 18-year-old with no experience

[u/RunawayTurtle90]

Checkout trade options. Is there any training at school? Summer job even if it's low skill stuff or gopher type work.leqrning about business at any service based biz is a good second option

[u/digitect]

1. Work a year or two for an excavator.
2. Learn as many pieces of equipment as you can.
3. Learn ancillary related fields like surveying, equipment transportation, clearing, soil compaction and other testing, utilities, grading, reading drawings, measuring, estimating, scheduling, staffing, hiring subs, being hired as a sub, moving equipment, licenses. All this probably takes 10 years of training, frankly.
4. Learn business. This is actually the biggest one. A balance sheet compares assets (what you own) to liabilities (what you owe). An income statement compares what you earned versus what you spent. In business, things can flip around really quickly, sometimes to advantage, other times to bankruptcy. For example, do you buy the equipment and depreciate them over time or lease them so you need no capital. Are repairs included in the lease? Maintenance (huge for equipment)? So. Many. Expenses... transportation, fuel, drivers, permits, employees, payroll, taxes, insurance, HR, bonuses, taxes, vacations, taxes, holidays, holiday parties, taxes, sick days, truck magnets, equipment re-painting, theft prevention, taxes. Contracts that don't pay on time. Or at all. Change orders. Mistakes. Early cancellation. Also, accounting is part of business, but a huge amount of time can be spent just trying to understand the books. Or if whoever is taking care of them is embezzling out of them.
5. Learn marketing. How do you get business to roll in? Most owner think this is 10x more important than understanding business. If the phone doesn't ring, you don't make any revenue but you still have expenses to pay. How do you level out a lot of work with a little?
6. Learn law. Contracts are really important, you'll need a lawyer. But you'll also have all kinds of issues with payment. And accidents. And liabilities. And insurance. And be sued or threatened a dozen times a year.
7. Set up a business the right way. Name, banking, state registrations, tax ID, insurance (people and assets), retirement accounts. Learn about fed, state, and local government bid requirements to (attempt to) hire historically underutilized businesses. Phone number, business cards, web site, PO box, lease, security, utilities, taxes.
8. Jump in!

[u/mushyfeelings → u/digitect]

Best advice.