Bought Bucket Truck for Rental Portfolio - Utilization Questions!
Hello,
I'm writing this from central Iowa. We have a growing rental portfolio currently of 6 properties.
We have a couple other local landlords/investors here that are useful to bounce ideas around with.
Over the last couple of years, we have evaluated several businesses as possible candidates to purchase - the idea being to diversify, but also to allow us some flexibility to capture some value with suppliers that we would be using anyways. Some of the ones we've looked at have included: a granite shop, a cleaning business, and a tree trimming business.
Most recently, I linked up with an individual with a very solid background in gutters and window/fascia wrap. We also have a house under contract that has an especially tricky roof that needs installed, as well as quite a bit of tree trimming and some masonry work that will require someone to be off the ground significantly. We felt that a bucket truck was justified, and purchased one about a week ago. We have been able to put it to work immediately on a house that we are rehabbing. We paid $3200 for it.
We are thinking of forming a multi member LLC with an operating agreement that in a nutshell spells out something like:
- Revenues OR Net Income Split (30% Owner Operator, 15% me/wife, 55% back into business)
- Our rental operation gets 'close to cost' work from this new company that crosses over with gutters, fascia, soffit, and window wrapping. We provide some commitment of baseload work for the fledgling company.
- We provide material marketing / IT support as well as function as passive investors/advisors
- Primary Sales and Operational Responsibilities fall on other Members (husband / wife duo)
- Bucket Truck can be rented to our Rental Operation for $1/day if we give enough advanced warning of need, and we can rent it externally, as well.