Starting a concrete production business can be a very profitable business, or it can bring continuous losses, depending on whether you manage to establish sales of finished products.
The main consumers of concrete are construction companies, so the well-being of the concrete plant also depends on their volume of work. Therefore, before starting this business, it is necessary to conduct a thorough marketing research , study demand and competition, outline distribution channels and determine the volume of supplies. In addition, it is necessary to have guarantees for the timely receipt of inert materials and cement for the production of concrete. This work should be completed with the preparation of a business plan, according to which production should be launched.
Only such a path can lead an entrepreneur to create a successful and profitable enterprise.
Many entrepreneurs make the mistake of focusing on the unfolding construction of large facilities. Firstly, the builders may already have concrete supplies with other contractors. And, secondly, if the line is frozen, the concrete plant will collapse. Therefore, it is extremely important in such cases to obtain reliable information about the timing of construction, the reliability of financing and to agree in advance on the volume of supplies.
After all, investments in the creation of a concrete plant are quite solid. Even if we are talking about a small plant for 40-50 cubic meters of concrete per day, then the initial costs only for the purchase of equipment will amount to several thousand dollars.
But, in addition to the equipment, it is necessary to perform quite a lot of costly work:
- select and prepare a site for production;
- build a warehouse for cement storage and service premises;
- to equip access roads and parking of vehicles;
- to bring power lines of sufficient power;
- purchase stocks of raw materials and obtain permits for the production of concrete.
A well-located concrete plant, fully loaded with orders, has a ROI of up to 35% and allows you to recoup your investment within the first year of operation.
But experience shows that often the profitability of concrete production has completely different indicators.
The profitability of concrete production is always highly dependent on two, often conflicting factors: proximity of the plant to raw materials and proximity to the customer. These requirements rarely coincide in reality, therefore, often, the cost of shipping either raw materials or finished products eats up a significant part of income. In addition, in the event of completion of construction, the concrete plant is too far from the new customer and the profitability of production is reduced.
The way out of this situation can be the purchase and operation of a mobile concrete plant, which can be quickly assembled and dismantled, depending on the circumstances. The capacity of such plants is small, but the flexibility of managing such an enterprise has its advantages.
And the success of management and planning is the key to the profitability of the business as a whole.
On our website you can order a business plan for a concrete plant with all the necessary calculations, which will help you set goals correctly, plan costs and quickly bring the company to profitability.