7 Ways Excavation Companies Waste Money

How excavation companies waste money

7 Ways Excavation Businesses Waste Money

How are you wasting money?

Every business has inefficiencies. No matter what you do, there are going to be places where you can tighten things up. With excavation, the stakes are high. You’re working with heavy machinery and there are many things that can go wrong.

In this article, I’m going to show you some common ways that excavation companies waste money and what you can do about them.

Hiring the wrong employees

Good employees can be one of your company’s most valuable assets. Bad employees can be your most expensive liability. If your employees are difficult to manage, have a penchant for damaging machinery, or are difficult in other ways, you might want to consider retraining or replacing them. The best people in excavation command top wages, and they’re worth it. Think of how much money you could save every year by reducing the number of preventable accidents and damage to your machines, as well as management costs and lost efficiency.

Running old equipment

Or perhaps this should say ‘low-quality equipment’. Some old machines are incredibly reliable. Their simplicity is their best feature as their are fewer things to break. That said, if your older machines are breaking down regularly and requiring a lot of maintenance and repair, it’s impacting your bottom line. Having a machine sitting on-site for a day or more while a mechanic repairs cylinder seals or any number of other things not only costs you directly, but indirectly as well because the machine isn’t earning any money while it’s down. Sometimes, spending more money on good equipment will save you in the long run.

Company trucks

In my years in the excavation business, it surprised me how many operators, foremen and management were given company pickup trucks.

This represents a huge cost to the company. Between purchase cost, insurance, fuel and maintenance, company trucks might be the least efficient way to give an employee a perk. Additionally, in some jurisdictions, the employee has to pay taxes on it as a ‘taxable benefit’. You might consider giving your guys an extra few hundred bucks per month so they can offset the cost of their personal truck rather than supplying a company pickup. 

Bad customers

We’ve all had bad clients, and you know that they can make your life a living hell if you let them. There are a few indicators that a customer is going to be a nightmare to work with including:

  • Arrogance – they’ve hired you as a professional, and yet they seem to think that they know everything.
  • Endless haggling – nickel and diming you on every little detail of a job.
  • Nagging – constant contract revisions, picking apart your work and watching you for hours while you dig.
  • Indecisiveness – if the client isn’t crystal clear on what it is that they want, how are you supposed to deliver an end result that they will be satisfied with?

These are just a few example, there are many red flags not mentioned here but the bottom line is this: trust your gut. If you think that a client is going to be a nightmare to work with, you’re probably right. You’ve worked with enough people in the past to have a feeling for when it’s not likely to go well.


Moving excavation equipment can be astronomically expensive. When I was a full-time lowbed operator, it surprised me how often I’d drop a machine at a client’s yard, just to pick it up from the same spot a day later. Of course sometimes this is maintenance related or the machine had to be off site for a certain time. The bottom line is, you can save a lot of money by leaving a machine on-site for an extra few days if possible to make it line up with your next project and bring it directly there.

Spending too much money on marketing

This is common among younger, ambitious excavation contractors as well as more established contractors. Marketing is one of the easiest ways to waste money. From branding packages to billboards and truck wraps, fancy websites to Yellowpages advertising, PPC, social etc. It can be really difficult to figure out exactly how to target the exact customers you’re trying to reach so contractors with some money to spend sometimes take the “throw everything at the wall and see what sticks” approach to marketing.

Much of this spending is unnecessary. Getting your name in front of everybody is expensive, but getting your name in front of a smaller, targeted group of potential clients is much more affordable. If you’re getting to the point where you want to start advertising and building your brand, it’s a good idea to employ the services of a marketing company that takes the time to understand your market intimately. A good company will expertly guide you towards marketing activities that will actually drive results.

Spending too little money on marketing

Wait, what? Hear me out. While it is possible to build a business on handshakes and referrals (and referrals are often the best type of clients), it’s also wise to invest in your marketing at the same time. There are many benefits to a strong marketing campaign including:

  • A steady stream of new leads
  • Strong brand presence in your market – people know who you are
  •  Professional appearance and customer experience
  • Learn more about your customers and their behavior 

How much should you spend on marketing?

There’s no simple answer to this question. How much your business should spend on marketing depends on a variety of factors. That said, common advice suggests that if you’re looking to grow, you should be spending around 10% of your revenue on marketing activities.

Want to talk about a marketing campaign that actually works?

We understand when business owners are skeptical of marketing companies. You likely get calls weekly from Yelp, Yellow Pages and and other marketers who swear up and down that they’re the best solution for your business. We get it, it’s hard to know who to trust. If you want to discuss your digital marketing strategy with an agency who specializes in working with excavation and landscape companies, we’d love to chat and offer you a free evaluation of your online and SEO presence. No obligation, no fee and no strings attached.

Ready to dig in and roll out?

RankMaster is the premier agency for Excavation and Landscape Contractors.