In a short time, some drilling contractors have grabbed hold of the technology and are making really good money. Others have made a fortune and lost it just as fast–and not because they weren’t good drillers.

Today, most struggling contractors spend more time putting holes in the ground to build up the bottom line than they do focusing on the bigger picture of where their business is heading.

To understand the difference between the two kinds of contractors, one needs to understand that developing technology has changed the economics of directional drilling. Less than five years ago, drilling carried enormous profit margins because it was a new alternative to excavation. It was not uncommon to hear about profit margins of 50 percent. The market is much more competitive and the price per foot hasn’t leveled out yet.

We’ve been watching the market for several years, and we’ve noticed a consistent pattern that runs through successful companies. The traits include good people, organization, vision, planning, maintenance and profitability. Name a company in business for any length of time that does not display most, if not all, of these ingredients. You probably can’t, because a company like that can’t exist profitably over the long haul–nor will many newer companies if they are not taking care of business.

People Recruiting and keeping quality people is a common concern everywhere. But all the training imaginable is no good if you do not get good people in place and concentrate on programs that motivate them.

Many quality employees, especially those who have families, are looking for an environment that places value on life outside work. Recruits are also quick to learn if an employer offers open communication with supervisory people. Competitive pay and benefits are important, too. But it is harder to build a company culture that gives employees the tools they need to be confident in their job and work toward your goals.

Machine Maintenance

Like many parts of a business, good maintenance is a mindset, not a job. Maintenance is not just fixing what is broken, but preventing breakdowns, too. The most important maintenance ingredient in your drilling operation is far better off if the attitude is to “prevent” rather than “fix.” It is not realistic to think an operator can know how to fix everything on a drill rig. But operators should have an overview of machine training so they can accurately communicate problems over the phone.


There are two ways to look at planning. Business owners need time to look at the big picture of their operations and decide how to best position the company for the future. The other type of planning involves committing the entire job to paper before starting a job.

On the job site, you will have a better chance of doing a successful bore with proper planning. This includes mapping out a projected bore path, using a checklist for supplies, making specific assignments, finding a good water supply, and identifying utilities and other obstructions.


One of the greatest tools you can give an employee is training. Most of the training we’re seeing is offered regularly and focuses on machine safety. It might be a wise investment to include emergency management training as well.

There are many approaches to training, but one thing is certain: use an expert during regular business hours. Experts can come to your facility from outside sources. You can also send your staff to seminars hosted by industry leaders. Finally, if you have qualified trainers on your staff, have them coordinate a program.


Finally, the margin for error drops in relation to the profit margin. Poor management of people, jobs and equipment is always costly, but mistakes today are three times more expensive than before. For example, when you can’t complete a $1,000 bore on Monday, you return on Tuesday. Unfortunately, the bore originally scheduled for Tuesday is not getting done, so that’s another $1,000 profit loss. Then there’s the cost of redoing the original bore. Now you’re $3,000 in the hole.

Apply the math to your business.

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