Do you want to start a concrete plant and need to write a plan? If YES, here is a sample ready mix concrete plant business plan template & feasibility report.
It is an established fact that construction works aren’t going away any time soon in the United States. This goes to show that any business in the value chain of the construction industry is bound to succeed. Hence a ready mix concrete manufacturing business is worth starting in the united states of America.
Ready mixed refers to concrete that is batched for delivery from a central plant instead of being mixed on the job site. The United States in particular has some serious infrastructural goals that need to be filled in the coming years, meaning that as a ready mix concrete manufacturing company, there are loads of jobs waiting for you.
Interestingly, smaller operators comprise the majority of total establishments in the ready mix concrete manufacturing industry not just in the United States but in most countries of the world and they serve local markets. Below is a sample ready mix concrete manufacturing business plan that will help you write your own without stress.
A Sample Ready Mix Concrete Plant Business Plan Template
1. Industry Overview
Ready mix concrete, or RMC as it’s also known, refers to concrete that is specifically batched or manufactured for customers’ construction projects, and supplied to the customer on site as a single product. It is a mixture of cement, water and aggregates: sand, gravel, or crushed stone.
Ready mixed concrete is used in construction projects where the construction site is not willing, or not able, to mix concrete on site. Using ready-mixed concrete means product is delivered finished, on demand, in the specific quantity required, and to the specific mix design required.
For a small to medium project, the cost of hiring mixing equipment, labor, plus purchase and storage for the ingredients, added to environmental concerns (cement dust is a particular airborne health hazard) may simply be not worth it when compared to ready-mixed concrete, where the customer pays for what they use, and lets someone else do the work up to that point.
For a large project, outsourcing concrete production to ready-mixed concrete suppliers means delegating the quality control and testing, material logistics and supply chain issues to specialists who are already set up for those tasks. Ready-mix concrete is bought and sold by volume – usually expressed in cubic meters (cubic yards in the US). Batching and mixing is done under controlled conditions.
The Ready – Mix Concrete manufacturing industry manufactures concrete and delivers it in a plastic and unhardened state to purchasers, who then mix and pour the concrete at construction sites. Please note that this industry does not engage in mixing and pouring operations.
It also does not manufacture dry concrete. Statistics has it that the Concrete Contractors industry in the United States of America, is worth over $34 billion, with an estimated growth rate of 5.1 percent between 2014 and 2019. There are about 81,886 registered and licensed ready – mix concrete manufacturing businesses in the United States and they are responsible for employing about 279,527 people.
It is important to state that CEMEX SAB de CV is the company with a dominant market share in the United States. A recent report published by IBISWorld shows that over the five years to 2019, favorable lending rates, improved per capita disposable income and record corporate profit levels have helped bolster construction activity across several sectors, increasing demand for industry products.
The report reveals that housing stats are expected to increase an annualized 6.2 percent over the five years to 2019. Conversely, unemployment is expected to fall at an annualized 10.7 percent during the same period, boosting the need for new office, industrial and manufacturing space.
The ready – mix concrete business will keep on thriving in the coming decade. The market is highly unsaturated and there is room for growth as the industry is expanding and maturing.
The Ready-Mix Concrete Manufacturing industry is very open to any aspiring entrepreneur who have acquired the required trainings, skills and perhaps professional certifications to start his or her own plant and of course make good money from the industry.
2. Executive Summary
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. is a licensed American ready – mix concrete manufacturing company.
We have been able to secure a standard facility in an industrial district in Arlington Heights – Texas. We are set to compete in the highly competitive Ready Mix Concrete Manufacturing industry not only in Arlington Heights – Texas, but also throughout the United States market.
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. will manufacture ready mix concrete and deliver it in an unhardened state to purchasers who will then mix and pour the concrete at construction sites. Our business goal is to become one of the leading mix concrete companies in the United States and we will make sure that we do all we can to compete favorably with leaders in the industry.
Our workers are going to be selected from a pool of highly experienced civil engineers, technicians and tradesmen with different areas of expertise as it relates to our service offerings.
We will make sure that we take all the members of our workforce through the required trainings that will position them to meet the expectation of the company and to compete with leading concrete contracting companies in the United States.
At OJ Maxwell® Ready Mix Concrete Manufacturing, Inc., our client’s best interest will always come first, and everything we do will be guided by our values and professional ethics. We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely.
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. is founded by Engr. Olsen Jay Maxwell. Engr. Maxwell graduated from A and M University, Texas; with a B.Engr. in Civil Engineering. He will run the business alongside his son Jeremy Maxwell who has a B.Sc. in Business Administration.
They have a combined experience that can help them build OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. to favorably compete with other ready mix concrete businesses in the United States of America.
3. Our Products and Services
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. is established with the aim of maximizing profits in the industry.
We want to compete favorably with the leading ready companies in the United States which is why we have but in place a competent quality assurance team that will ensure that every ready mix concrete manufactured from our plant meet and even surpass our customers’ expectations.
We will work hard to ensure that OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. is not just accepted in Arlington Heights – Texas but also in other cities in the United States of America. Our service offerings are listed below;
- Manufacturing wet batches of ready-mix concrete in plants
- Delivering ready-mix concrete to end users
- Manufacturing ready-mix concrete in transit using mobile plant facilities
4. Our Mission and Vision Statement
- Our vision is to establish a standard and all – round ready mix concrete manufacturing company whose brand will not only be accepted in Arlington Heights – Texas but also in other cities in the United States of America.
- Our mission is to provide globally accepted ready mix concrete from our manufacturing plant and on transit and to build a ready mix concrete manufacturing company that can favorably compete with other leading brands in the industry.
Our Business Structure
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. intends starting small in Arlington Heights – Texas, but hopes to grow big in order to compete favorably with leading ready mix concrete manufacturing companies in the United States.
We are aware of the importance of building a solid business structure that can support the kind of world class business we want to own.
At OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. we will ensure that we hire people that are qualified, hardworking, creative, customer centric and are ready to work to help us build a prosperous business that will benefit all the stakeholders (the owners, workforce, and customers).
As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of ten years or more as agreed by the board of trustees of the company. In view of the above, we have decided to hire qualified and competent hands to occupy the following positions;
- Chief Executive Officer
- Plant Manager (Senior Civil Engineer)
- Human Resources and Admin Manager
- Sales and Marketing Executive
- Civil Engineers/Tradesmen
- Client Service Executive
5. Job Roles and Responsibilities
Chief Executive Officer – CEO:
- Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results
- Responsible for providing direction for the business
- Creating, communicating, and implementing the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
- Responsible for signing checks and documents on behalf of the company
- Evaluates the success of the organization
Plant Manager (Senior Civil Engineer):
- Oversees operations in the ready mix concrete manufacturing plant
- Serves as project manager of the organization; works directly with employees
- Develops strategic plan by studying technological, and financial opportunities; presenting assumptions; recommending objectives.
- Accomplishes subsidiary objectives by establishing plans, budgets, and results measurements; allocating resources; reviewing progress; making mid-course corrections.
- Maintains quality service by establishing and enforcing organization standards.
- Maintains professional and technical knowledge by attending educational workshops; reviewing professional publications; establishing personal networks; benchmarking state-of-the-art practices; participating in professional societies.
- Make certain that the technical department perform efficiently, coordinate employee efforts, and facilitate communications between management and handymen
- Ensures that the organization work in line with international best practices.
Admin and HR Manager
- Responsible for overseeing the smooth running of HR and administrative tasks for the organization
- Regularly hold meetings with key stakeholders to review the effectiveness of HR Policies, Procedures and Processes
- Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
- Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
- Defining job positions for recruitment and managing interviewing process
- Carrying out induction for new team members
- Responsible for training, evaluation and assessment of employees
- Responsible for arranging travel, meetings and appointments
- Oversee the smooth running of the daily office activities.
Sales and Marketing Manager
- Manage external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
- Model demographic information and analyze the volumes of transactional data generated by customer
- Identifies development opportunities; follows up on development leads and contacts
- Writing winning proposal documents, negotiate fees and rates in line with organizations’ policy
- Responsible for handling business research, market surveys and feasibility studies for clients
- Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
- Create new markets cum businesses for the organization
- Empower and motivates the sales team to meet and surpass agreed targets
- Responsible for preparing financial reports, budgets, and financial statements for the organization
- Provides managements with financial analyses, development budgets, and accounting reports
- Responsible for financial forecasting and risks analysis.
- Performs cash management, general ledger accounting, and financial reporting for one or more properties.
- Responsible for developing and managing financial systems and policies
- Responsible for administering payrolls
- Ensuring compliance with taxation legislation
- Handles all financial transactions for OJ Maxwell® Ready Mix Concrete Manufacturing, Inc.
- Serves as internal auditor for OJ Maxwell® Ready Mix Concrete Manufacturing, Inc.
- Responsible for manufacturing wet batches of ready-mix concrete in plants
- Responsible for manufacturing ready-mix concrete in transit using mobile plant facilities
- Responsible for operating and maintaining concrete mixers, transit mixer trucks, dumper trucks, crane hoppers, truck-mounted conveyors, and, in extremis, wheelbarrows and other related equipment
- Handle other related job as instructed by the Plant Manager.
Client Service Executive
- Welcomes clients and potential clients by greeting them in person or on the telephone; answering or directing inquiries.
- Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
- Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
- Manages administrative duties assigned by the creative director in an effective and timely manner
- Consistently stays abreast of any new information on the organizations’ products, promotional campaigns etc. to ensure accurate and helpful information is supplied to clients when they make enquiries
6. SWOT Analysis
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. engaged the services of a core professional in the area of business consulting and structuring to assist our organization in building a well – structured company that can favorably compete in the highly competitive concrete concreting industry in the United States.
Part of what the team of business consultant did was to work with the management of our organization in conducting a comprehensive SWOT analysis for OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. Here is a summary from the result of the SWOT analysis that was conducted on behalf of OJ Maxwell® Ready Mix Concrete Manufacturing, Inc.;
We can boast of having a system that runs on automation and it includes concrete mixers, transit mixer trucks, dumper trucks, crane hoppers, truck-mounted conveyors, in extremis, wheelbarrows and autonomously operating equipment.
We have been able to select a team of workforce that will give us advantage. Aside from the synergy that exists in our carefully selected workforce, our production process and products will be guided by international best practices.
As a new ready mix concrete manufacturing company in Arlington Heights – Texas, it might take some time for our organization to break into the market and gain acceptance especially from top profile clients (construction companies) in the already saturated and industry; that is perhaps our major weakness. Another weakness is that we may not have the required cash to promote our business the way we would want to.
Construction can be very fast if RMC is used. It reduces cement consumption by 10 – 12 percent due to better handling and proper mixing. Further reduction is possible if mineral admixtures or cementitious materials are used.
Acceleration of the housing and nonresidential construction markets in the United States is bound to support growth for our business. Operators in the nonresidential building market are major consumers of concrete, mostly for use in foundations, suspended slab flooring, tilt walls and paving.
Ready-mix concrete is also the principal input into a wide range of other nonbuilding infrastructure, such as transportation terminals, sports stadiums and petrochemical plants. The value of private nonresidential construction is expected to increase in 2019, representing a potential opportunity for the industry.
Private investment in housing, commercial buildings and infrastructure is influenced by trends in long-term interest rates. A low inflationary outlook and interest rate stability foster investment in construction markets, boosting demand for ready-mix concrete.
Therefore, a low interest rate, characterized by a low yield on the 10-year Treasury note, bolsters revenue for ready-mix concrete manufacturers. The yield on the 10-year Treasury note is expected to decrease in 2019, but continued projections of growth mean it remains a potential threat to the industry.
7. MARKET ANALYSIS
- Market Trends
A close watch on industry activities shows that revenue increase is due to an acceleration in downstream construction markets in the United States. As a result of the steady increase of demand from downstream construction markets, activities in this industry, registered businesses and of course contracts/job numbers have been trending upward.
Going forward, the construction industry and real estate industry are expected to continue thriving hence increase in the demand for ready mix concrete. Strengthening demand from downstream markets has driven growth for the Ready – Mix Concrete Manufacturing industry.
Operators in the industry produce and deliver wet batches of concrete to construction contractors. Companies do not mix the concrete or pour it, instead they focus on manufacturing and distribution. The industry’s largest market is in construction, both for private residential and nonresidential use and for state and local public agencies.
Therefore, industry demand is primarily driven by housing stats and the value of government investment on state and local projects. Growth in these factors, coupled with other economic catalysts, has pushed the industry to increase at an annualized rate of 5.1% to $34.0 billion over five years.
Another notable trend shows that ready mix concrete plants are moving from using technology solutions for specific tasks to having real-time and accurate information at their fingertips. Construction productivity is on the brink of a huge leap due to integrated and intuitive software that doesn’t just give you a bunch of numbers but rather provides easy-to-understand information that enables you to make good decisions.
8. Our Target Market
Before starting our ready mix concrete manufacturing company in Arlington Heights – Texas, we conducted a market survey and feasibility studies and we are certain that there is a wide range of construction companies and other players in the construction value chain that need our products. We are aware that the industry’s primary markets are the nonresidential and residential building sectors.
Our Competitive Advantage
There are favorable conditions for growth in the Ready Mix Concrete Manufacturing industry and as a result of this, survival in the industry will require that you build on existing knowledge and broaden your skill base. More ready mix concrete manufacturing companies are coming up and they are using the services of existing franchise in the business to boost their competitive edge and exposure in the industry.
We are quite aware that to be highly competitive in the Ready Mix Concrete Manufacturing industry means that you are not only expected to deliver reliable ready mix concrete, but you must be able to meet set targets. No one would want to hire your services if don’t always meet up with target.
Our Competitive Advantage lies in the power of our team; our workforce. We have a team of certified and highly trained civil engineers and technicians et al, a team with excellent qualifications and experience in various niche areas in the ready mix concrete manufacturing industry. Aside from the synergy that exists in our carefully selected workforce, our services will be guided by best practices in the industry.
Lastly, all our employees will be well taken care of, and their welfare package will be among the best within our category in the industry. It will enable them to be more than willing to build the business with us and help deliver our set goals and objectives.
9. SALES AND MARKETING STRATEGY
We are mindful of the fact that there are stiff competitions in the Ready Mix Concrete Manufacturing industry, hence we have been able to hire some of the best marketing experts to handle our sales and marketing. Our sales and marketing team will be recruited based on their vast experience in the industry and they will be trained on a regular basis so as to be equipped to meet their targets.
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. is set to make use of the following marketing and sales strategies to attract clients;
- Introduce our business by sending introductory letters alongside our brochure to construction and real estate companies and key stake holders in and around Arlington Heights, Texas.
- Promptness in bidding for ready mix concrete supply contracts from construction companies and real estate companies
- Advertise our business in relevant business magazines, newspapers, TV and radio station.
- List our business on yellow pages ads (local directories)
- Attend relevant international and local expos, seminars, and business fairs et al
- Leverage on the internet to promote our business
- Engage direct marketing approach
- Encourage word of mouth marketing from loyal and satisfied clients
Sources of Income
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. is established with the aim of maximizing profits in the Ready Mix Concrete Manufacturing industry and we are going to ensure that we do all it takes to meet and surpass the expectations of our clients.
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. will generate income by;
- Manufacturing wet batches of ready-mix concrete in plants
- Delivering ready-mix concrete to end users
- Manufacturing ready-mix concrete in transit using mobile plant facilities
10. Sales Forecast
One thing is certain, there would always be construction and real estate companies, households and individual who would need the services of ready mix concrete manufacturing companies.
We are well positioned to take on the available market in the Ready Mix Concrete Manufacturing industry and we are quite optimistic that we will meet our set target of generating enough income/profits from the first six months of operation and grow our company to enviable heights.
We have been able to examine the ready mix concrete manufacturing cum construction market and we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below is the sales projection for OJ Maxwell® Ready Mix Concrete Manufacturing, Inc., it is based on the location of our business and of course our target market;
- First Fiscal Year (FY1): $350,000
- Second Fiscal Year (FY2): $750,000
- Third Fiscal Year (FY3): $1.2 million
N.B: This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor offering same products as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.
11. Publicity and Advertising Strategy
We have been able to work with our brand and publicity consultants to help us map out publicity and advertising strategies that will help us walk our way into the heart of our target market.
We are set to become the number one choice for both corporate clients and households in the whole of Arlington Heights – Texas and beyond which is why we have made provisions for effective publicity and advertisement of our ready mix concrete manufacturing company.
Below are the platforms we intend to leverage on to promote and advertise OJ Maxwell® Ready Mix Concrete Manufacturing, Inc.;
- Place adverts on both print (newspapers and construction and real estate related magazines) and electronic media platforms
- Sponsor relevant community – based events/programs
- Leverage on the internet and social media platforms like; Instagram, Facebook, LinkedIn, Twitter, YouTube, Google + et al to promote our products
- Install our Billboards in strategic locations all around Arlington Heights – Texas
- Distribute our fliers and handbills in target areas
- List our company in local directories/yellow pages
- Advertise our company in our official website and employ strategies that will help us pull traffic to the site.
- Ensure that all our staff members wear our branded shirts and all our vehicles, concrete mixers, transit mixer trucks, dumper trucks, crane hoppers, truck-mounted conveyors, wheelbarrows and other related equipment are branded with our company logo.
12. Our Pricing Strategy
According to the NRMCA – Ready Mixed Concrete Industry Data Survey, the average cost of concrete in 2016 was $108.22 per cubic yard, or $216.44 for the 2 cubic yards. At OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. we will keep the prices of our ready mix concrete below the average market rate by keeping our overhead low.
In addition, we will also offer special discounted rates to all our customers at regular intervals. We are aware that there are some one – off jobs or government contracts which are always lucrative, we will ensure that we abide by the pricing model that is expected from contractors that bid for such contracts.
- Payment Options
The payment policy adopted by OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.
Here are the payment options that OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. will make available to her clients;
- Payment via bank transfer
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
- Payment via bank draft
In view of the above, we have chosen banking platforms that will enable our clients make payment for ready mix concrete delivered without any stress on their part.
13. Startup Expenditure (Budget)
From our market survey and feasibility studies, we have been able to come up with a detailed budget for establishing a standard ready mix concrete manufacturing company in Arlington Heights – Texas and here are the key areas where we will spend our startup capital;
- Business incorporating fees in the United States of America will cost – $750.
- The budget for Liability insurance, permits and license will cost – $3,500
- Acquiring a facility that will accommodate the number of trucks for at least 6 months (construction of ready mix concrete plant inclusive) will cost – $120,000.
- The amount required to purchase the needed concrete mixers, transit mixer trucks, dumper trucks, crane hoppers, truck-mounted conveyors, wheelbarrows and other related equipment – $200,000
- Equipping the office (computers, printers, projectors, markers, servers/internet facility, furniture, telephones, filing cabinets, and electronics) will cost – $5,000
- Launching an official Website will cost – $500
- Amount need to pay bills and staff members for at least 2 to 3 months – $50,000
- Additional Expenditure such as Business cards, Signage, Adverts and Promotions will cost – $1,000
Going by the report from the market research and feasibility studies conducted, we will need about six hundred and fifty thousand ($650,000) U.S. dollars to successfully set up a medium scale but standard ready mix concrete manufacturing company in the United States of America.
Generating Funds/Startup Capital for OJ Maxwell® Ready Mix Concrete Manufacturing, Inc.
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. is owned and managed by Engr. Olsen Jay Maxwell and his immediate family members. They decided to restrict the sourcing of the startup capital for the business to just three major sources.
- Generate part of the startup capital from personal savings and sale of his stocks
- Generate part of the start up capital from friends and other extended family members
- Generate a larger chunk of the startup capital from the bank (loan facility).
N.B: We have been able to generate about $150,000 (Personal savings $100,000 and soft loan from family members $50,000) and we are at the final stages of obtaining a loan facility of $500,000 from our bank. All the papers and documents have been duly signed and submitted, the loan has been approved and any moment from now our account will be credited.
14. Sustainability and Expansion Strategy
The future of a business lies in the number of loyal customers that they have, the capacity and competence of the employees, their investment strategy and the business structure. If all of these factors are missing from a business, then it won’t be too long before the business closes shop.
One of our major goals of starting OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. is to build a business that will survive off its own cash flow without injecting finance from external sources once the business is officially running.
We know that one of the ways of gaining approval and winning customers over is to offer our ready mix concrete a little bit cheaper than what is obtainable in the market and we are prepared to survive on lower profit margin for a while.
OJ Maxwell® Ready Mix Concrete Manufacturing, Inc. will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and re – training of our workforce is at the top burner.
We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.
- Business Name Availability Check: Completed
- Business Incorporation: Completed
- Opening of Corporate Bank Accounts: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Securing a standard ready mix concrete plant – facility, renovation and equipping of the facility inclusive: Completed
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Conducting Feasibility Studies: Completed
- Generating part of the startup capital from the founders: Completed
- Writing of Business Plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents: In Progress
- Design of Logo for the business: Completed
- Purchase of concrete mixers, transit mixer trucks, dumper trucks, crane hoppers, truck-mounted conveyors, wheelbarrows and other related equipment and other related equipment: Completed
- Printing of Packaging and Promotional Materials: Completed
- Recruitment of employees: In Progress
- Purchase of the needed furniture, office equipment, software applications, electronic appliances and facility facelift: In progress
- Creating Official Website for the business: In Progress
- Creating Awareness for the business: In Progress
- Health and Safety and Fire Safety Arrangement: In Progress
- Establishing business relationship with vendors and key players in the construction and real estate industries: In Progress