Production of cinder blocks: business plan with calculations

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Every year, construction volumes throughout the country are increasing, and consequently, the demand for materials is constantly growing. Therefore, the manufacture of cinder blocks as a business will be an excellent option for investing money. At the same time, many entrepreneurs choose this particular direction, since this type of finished product does not need to be certified. Let's try to understand all the features of this field of activity and find out what is needed to start, what investments the project will require, and how quickly the investment will pay off.

General information

Before you start writing a business plan for the production of cinder blocks, you need to assess the potential of this niche. To date, the most common is the low-rise construction of residential buildings and economy-class cottages. This is due to the fact that due to the economic crisis there are no large private and state orders. Therefore, the demand for cheap materials todayas high as ever. And since the discussed products are endowed with good technical characteristics and high practicality, they are the leaders in terms of sales.

The cinder block manufacturing business plan will be given below. This building stone has a low cost.

Since its main component is concrete, the following components can be added to it in various proportions:

• sand;
• rubble;
• slag;
• sawdust;
• remains of a brick;
• other raw materials.

Thus, this material is considered one of the best for the construction of inexpensive but practical houses.

Advantages of cinder block

What are they? If you get serious and put together a good cinder block business plan, you can build a successful company that consistently generates high profits.

This is also due to the fact that in addition to being cheap, this material has the following advantages:

• ease of operation;
• good strength and durability;
• high performance;
• excellent heat and sound insulation;
• fire safety;
• light weight;
• resistance to pests, as well as the formation of mold and mildew.

In addition to all of the above, cinder block is much more economical than many other materials, making the construction of real estate much cheaper.

Prospectiveactivities

This issue needs special attention. A detailed business plan for the production of cinder blocks with calculations will be given at the end of the article, but for now let's look at the main advantages of this type of activity.

Experienced entrepreneurs say that among the main advantages are the following:

• low entry threshold;
• fast ROI;
• high demand for finished products;
• excellent profitability;
• large selection of equipment to improve the quality of materials and reduce their cost;
• the ability to start production even in a small workshop.

Given all the above advantages, we can conclude that the production of cinder blocks is very promising in terms of economic efficiency.

Legal

What are they? Before you start calculating a business plan for the manufacture of cinder blocks, you need to deal with some organizational issues. If you plan to engage in production in small volumes and sell finished materials on the regional market, then for the first time you can register as an individual entrepreneur. In the future, when scaling, most likely, it will be necessary to form an LLC. When submitting an application to the tax office, you need to indicate the OKVED code 26.6, which involves the production of gypsum, cement and concrete products. As for the taxation system, the best option would be "simplified", since itdoes not require strict reporting and drawing up a large amount of documentation, so you can work without an accountant.

As mentioned at the beginning of the article, the cinder block is not subject to certification, so it will be quite simple to organize production. However, you should not forget that all components that are used for manufacturing must meet the established quality standards. In order to avoid any problems in the future, it is better to immediately purchase good raw materials so that reliable cinder blocks are obtained at the output. A business plan with calculations should include the actual cost of production, so that you have an idea of the potential profit and the timing of reaching break-even.

A few words about raw materials

What is its feature? The cinder block is actually an artificial building stone. The main component of its composition is concrete, which is mixed with sand, gravel and some construction waste. Using this technology, the material has been produced for several decades. However, every year more and more popular is the environmentally friendly cinder block, which is based on expanded clay or other modern polymeric materials. The binding element is cement with plasticizers. The latter are needed in order to make the mixture more plastic and easier to work with. For your investment to be successful, you must take your project planning very seriously.

Compiling a business plan for the production of cinder blocks,you need to consider the following nuances:

• what raw materials are available on the market in your area;
• what types of building materials are in the highest demand;
• what will you focus on - quality or cheapness.

These aspects are very important and should be carefully considered at the project planning stage.

Search for premises

One of the most important aspects to consider when drawing up a business plan for the production of products, regardless of its group, is the search for a suitable premises. It must have a workshop and a warehouse. As for cinder blocks, a building with an area of about 120 square meters would be the best option. This is enough for the manufacture of building materials in the average volume.

In addition, it must meet the following criteria:

• the presence of a powerful ventilation system;
• heating;
• Smooth concrete floor that can support heavy equipment.

Also, there must be a good access to the building so that you can freely import raw materials and send finished products to customers. As for the warehouse, it must be well protected from moisture, since it greatly impairs the characteristics of the cinder block.

Technological process

What is it? When planning a business plan for the production of cinder blocks, you should have a detailed idea of the manufacturing technology of this building material,to take into account all the nuances.

It looks like this:

1. Dry ingredients are poured into the mixer, on the basis of which the mixture will be prepared.
2. Concrete is poured into molds and compacted well.
3. The die is sent to special pressing machines for approximately 30 seconds.
4. The cinder block is being dismantled and moved to special wooden pallets.
5. Finished products are sent to dry.

It is worth noting that the strength of the material depends on the stiffness of the prepared concrete solution. The air temperature in the production hall must be at least 10 degrees Celsius. On average, it takes 2-4 days for the cinder block to completely harden. This time can be reduced by adding plasticizers to the mixture. After drying, the material must lie at least one month in natural environmental conditions for full ripening. Only after that, the products can be sent for sale.

Technical equipment

Organization of production, a business plan must necessarily provide for this, is impossible without certain specialized equipment.

When starting a small workshop capable of producing up to 450 pieces of cinder block daily, you will need to purchase the following:

• vibropress;
• forms for pouring concrete mix;
• line control panel;
• pumping station for water supply.

The investment in material and technical equipment is about 500,000 rubles. However, this amount does not includeconcrete mixer, belt conveyor, racks and pallets. For a complete arrangement, approximately 1 million rubles will be required.

Financial performance and payback

Any business plan for the production of cinder blocks with calculations must necessarily include this section so that you can really understand after what period of time the investment will fully pay for itself and begin to generate profit. Let's assume that you will be making 450 cinder blocks daily. In this case, the main items of expenditure will be as follows (all prices are given in rubles):

• purchase of raw materials - 110,000;
• wages of employees - 40,000;
• room rental - 40,000;
• logistics - 7000;
• utility payments - 3000;
• marketing - 9000;
• other related expenses - 10,000.

Thus, for normal functioning, you will have to spend 220,000 rubles a month. During this time, with a standard mode of operation, you will be able to produce 11,250 pieces of artificial stone. The cost of one is 30 rubles, so from one batch you will gain 337,500 rubles. We subtract from this amount taxes, which amount to 50,625 rubles, as well as the amount of financial resources required to maintain production, and we get a net profit - 66,875 rubles. Thus, breaking even will take an average of 8 to 12 months.

Potential customers

You can sell finished products to both private customers and small shopsbuilding materials and developers operating in your area. As practice shows, with a good advertising campaign, you yourself will not have to look for consumers, as they will contact you on their own.

Conclusion

Here, in fact, we have considered the process of opening a shop for the production of cinder blocks. Based on the specific figures given above, we can conclude that this line of business is very promising. At the same time, the demand for artificial stone is constantly growing, so you have good prospects for further scaling. Therefore, you can safely invest in this niche, as they will pay off almost 100 percent of the time.