Starting Milling Business Q's n A's

[GrantD]

You don't have to know squat about sawing to ask someone how long they've been doing the work and what their experience level is. It's not your job to babysit your customers and make decisions for them. It's rather naive to advocate being a seasoned expert before charging for your work. No one's time is free.

To the OP, my response is in no way directed towards you as you have already stated you are cutting your first few logs on a 50/50 split.

Spacemule: To use your phrasing... It's rather naive to offer a professional service under the guise that you "may" be experienced just because you have the equipment to perform said service.

That is the mindset on the pin hookers/jack-legs/fly-by-nite ******** that drives a lot of industry cost (example: liability insurance) through the roof for the folks that are doing things by the book and trying to make a living by it. /rant

 

[spacemule]

To the OP, my response is in no way directed towards you as you have already stated you are cutting your first few logs on a 50/50 split.

Spacemule: To use your phrasing... It's rather naive to offer a professional service under the guise that you "may" be experienced just because you have the equipment to perform said service.

That is the mindset on the pin hookers/jack-legs/fly-by-nite ******** that drives a lot of industry cost (example: liability insurance) through the roof for the folks that are doing things by the book and trying to make a living by it. /rant

Actually, undercutting and not charging enough to do a correct job is what drives a lot of the fly by night industry. Charging for a service and your labor is not operating under the guise that one is an expert. That is a separate issue and it is up to the buyer to determine to his satisfaction that the experience level of the operator matches his requirements.

 

[GrantD]

Grant D: I talked to the family accountant today (he's a family friend from way back when). He doesn't seem to think that becoming an LLC or INC would help me at this point in time, he's recommended I go and submit a DBA certificate with the county clerk and he'll get me a federal tax id and help me do quarterly returns and whatnot. I have insurance on the way. What sorts of things would I need to address with an attorney?

Thanks yawl,
Doug

Liability, liability, liability. In this day and age of the sue-happy consumer, you need to have your bases covered. The biggest thing is to protect yourself and personal assets (I.e. home, truck, personal items of value not associated with the buisness). If something goes wrong, some sort of damage occurs to something on/to your customer's property you personally are liable under a DBA. Under a LLC or S corp, the company is liable. If you ever have a civil suit, the latter will protect personal property. Just something to think seriously about, especially if your not only going to be working on a customer's property but also traveling back and forth to the site.

 

[4x4American]

My first bunch of jobs are 50/50 split, with people who aren't too worried how it comes out. But afterwards, that'll be cash on the barrel head son. This old grey dog gets paid to run. I'm not going to be charging some ridiculous hourly rate to start out with. I am going to cover my costs and establish a name.

Don't worry about how I milk my cows. There is very little portable milling going on around here as it is.

Now that that's out of the way, let's cut it with the drama, and get on to some useful information.

 

[4x4American]

Liability, liability, liability. In this day and age of the sue-happy consumer, you need to have your bases covered. The biggest thing is to protect yourself and personal assets (I.e. home, truck, personal items of value not associated with the buisness). If something goes wrong, some sort of damage occurs to something on/to your customer's property you personally are liable under a DBA. Under a LLC or S corp, the company is liable. If you ever have a civil suit, the latter will protect personal property. Just something to think seriously about, especially if your not only going to be working on a customer's property but also traveling back and forth to the site.

Now you see, that's what I was thinking too, but as my accountant told me, an LLC or S corp will protect my personal assets only if I wasn't the one who messed up.
Say I become an LLC.
Here are some examples:
Eg. A: I run over a little kid backing onto someone's property. Since I personally backed over the kid, I am going to be sued, as well as the company. LLC will not protect me.

Eg. B: An employee runs over a little kid backing onto someone's property. My company will be sued, and so will the employee who backed over the kid, but I am protected because of the LLC.

So since I don't have any employees, it won't benefit me to get LLC because I am the owner/operator.

What say you?

 

[GrantD]

A lot of it can and is bound to interpretation. The reason I suggest talking to a legal professional. And anyone can put a civil suit against you personally at anytime for any reason....


Now for backing over someone, that's a whole different aspect lol. I was leaning more towards running over water/sewage lines, causing damage to structures, things of that nature. And trust me, repairs can add up with a quickness.

Personally, I have an S corp that provides professional liability protection for the type of consulting I do. I have no idea what would be best for your situation, as I have never researched trying to provide milling services. I'm just making a few business related suggestions from my own experiences from being self-employed for a few years.

 

[4x4American]

well I appreciate the help GrantD. I will do some more looking into it. Another family friend is a judge I may have words with him and see where that gets me.

But for now, gotta get to sleep to wake and head back to paradise in the morn. Eastern daylight time o'er here.

Doug

 

[Jim Timber]

Negligence falls back on the guy who did it. The company is it's own entity as a corporation (just like having a partner to take the fall for you) and an LLC will protect you from certain cases, but when things get serious and the company isn't worth enough to settle the damages (log rolls off the mill and cripples the customer because you didn't keep them at a safe distance), they'll come after the guy responsible. Doesn't matter what veil you hide under in those cases; once your business assets are gone, they'll be looking for anything the law will allow them to take (some states prohibit taking a house, but if you have land it's fair game).

Sole proprietor with a good insurance policy is every bit as good of protection as isolating yourself via the LLC. You need the deep pockets to belong to someone else if someone goes after you regardless of who's fault it was.

 

[4x4American]

Seems like if something goes wrong it could become a big headache fast.

 

[imagineero]

Seems like if something goes wrong it could become a big headache fast.

That's true of all things, but no reason to not go out and do them. A ship in port is safe, but that's not what ships are made for.

 

[Jim Timber]

No risk = no reward.

If you're planning on sawing full time, I'd get a big fat personal disability policy on yourself before I worried about hurting someone else. Slipped disk will put you out for weeks/months. Just takes pushing that log/board wrong for a split second and you're down. Of course, if you're letting someone else help you, I wouldn't turn the saw on without the liability umbrella too. You might have a personal umbrella policy now (I do), but if you're operating a business that policy won't cover it. Same goes for transporting the saw itself. Your auto insurance probably won't cover it if the saw has something happen and it causes an accident - you're working even though you're rolling down the road at the time. First thing the adjuster is going to look for is a reason not to pay the claim at all, it's only after that they'll worry about how much to give you for it.

 

[Sawyer Rob]

It's rather naive to advocate being a seasoned expert before charging for your work. No one's time is free.

Who said anything about working for free???

Has it not occurred to you that's there's more than one way to charge for milling?? I don't charge by the hour, and I've been milling a long time...

How long have you been milling, and how do you charge that service??

SR

 

[4x4American]

No risk = no reward.

If you're planning on sawing full time, I'd get a big fat personal disability policy on yourself before I worried about hurting someone else. Slipped disk will put you out for weeks/months. Just takes pushing that log/board wrong for a split second and you're down. Of course, if you're letting someone else help you, I wouldn't turn the saw on without the liability umbrella too. You might have a personal umbrella policy now (I do), but if you're operating a business that policy won't cover it. Same goes for transporting the saw itself. Your auto insurance probably won't cover it if the saw has something happen and it causes an accident - you're working even though you're rolling down the road at the time. First thing the adjuster is going to look for is a reason not to pay the claim at all, it's only after that they'll worry about how much to give you for it.

For right now it's going to be on weekends unless I get enough work. I've got quite a bit of work lined up and more in the making. I went and filed a DBA today. I'm doing sawmill insurance through the Stanley McDonald Agency of Illinois, they have a sawmill specific insurance deal for property and liability. My accountant is setting me up with a federal tax id number and getting all that sort of stuff squared away. Next thing is going to be to talk with a lawyer.

Do any of yawl make the log owner sign any papers before milling begins?

 

[4x4American]

That's true of all things, but no reason to not go out and do them. A ship in port is safe, but that's not what ships are made for.

True words.

 

[Philbo]

Did you get the mill yet?