Running a pipe repair and replacement business can be expensive. It is important that as a contractor, you invest in the right equipment and understand the through life costs.
At the top end, directional drills will cost upwards of £100,000 ($140,000). Being able to operate a sustainable and growing pipe repair business means building to a position when you may have several crews out on the road every day of the week.
Why is through life cost important?
Capital plant equipment is a significant but necessary outlay and financial burden on contractors and utility companies. Payback is important. Increasingly companies are looking at whole of life costs of equipment. It goes beyond the initial purchase price and looks at things such as:
- How much does it cost to purchase or lease?
- What is the annual cost of maintenance?
- What is the expected lifespan of equipment?
- What is the replacement cost?
- What is the cost of spares and accessories?
If left unchecked?
Running a pipe repair and replacement business is going to get considerably more expensive if you are using drilling techniques that require more equipment, more set up and reinstatement time.
Solution
Pipe pullers, like the Kobus KPP300 are relatively inexpensive in capital equipment terms, costing around £25,000 – £30,000 – similar to a mini-excavator. Pipe pulling systems do require new consumables on each pipe replacement, however, maintenance costs are kept to a minimum by the design being largely maintenance free.
Compared to open cut excavation, pipe pullers can save around £1,000 – £1,500 per replacement when taking into account the reduction in time, resource, traffic management and reinstatement. That means they can payback in as little as six months and can keep on paying back for at least five years.
Make sure you understand the total cost of your pipe repair equipment. The right equipment might even help you make money.