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Wood Pellets Storage

Belarus, Minsk Region
Market: Logistics and warehouses, Production, Trade, Power Engineering
Project stage : Operating business

Date of last change: 30.05.2017
Sale price
$ 1.800.000
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Idea

Creation of central storage for European biofuel customers (existing and new)
European winter storage
All math and figures are taken from personal experience obtained during last year
Pellets sales market- Europe
Pricing policy of sales - summer 90€ winter 110€ Big Bags
Purchase of pellets - summer 72€, winter 100€
Income concept - to buy pellets in summer, to sale in winter
Value of the product: Any Certified volume available in stock is sold in winter
Turnover: 330000€ - first season, 800000€- second season. Turnover depends only on how early the purchase of pellets began and the availability of money supply.
Dead season for biofuel : June - August, as the price falls.
Payback of the project 2-3 seasons.

150,000 – 250,000 storage
30,000- 50,000 refinement depending on the condition of the roof
18,000 forklift
5,000 cameras, doors, alarm
1,000 weight checker
288,000 Purchase of pellets including VAT
Working staff : Forklift driver 160€ /month, packers
Total : 342,000 – 492,000
Risks and advantages
1. No salary risks (very important)
2. Poorly made roof can soak 2-3% of the total volume of pellets stock
3. 100% claimed goods
4. It is possible to open separate SP for removal of external risks.
5. Theft of pellets (unlikely, as everything is in big bags) impossible to take away by ordinary car, only control persons have the keys.
6. Poor quality products are excluded by 2 factors: 1- verified suppliers, 2- incoming inspection
7. Large customer base
8. Deliberate arson (decision - to insure against fire)

Current Status

Range of products

1. Fuel briquettes for boilers, fireplaces, saunas:
- Pini Kay(Octagonal wood briquettes with a hole in the middle made of dry compressed wood chips)
Packaged in shrink film, 12 PCs per 10 kg

- RUF (Pressed block briquette made of wood dust)
Packaged in shrink film, 10 PCs per 10 kg


2. Pine wood fuel granules (pellets) for boilers:
- Light pellets (6-8mm, ash content up to 0.4%)
  Packaging: Big bags and 15 kg bags, total weight 1000 kg

- Gray pellets (6-8mm, ash content up to 0.6%)
  Packaging:Big bags and 15 kg bags, total weight 1000 kg

- Dark pellets (6-8mm, ash content up to 1.2%)
  Packaging: Big bags and 15 kg bags, total weight 1000 kg
    

3. Wood cat litter (pellets):
- “Catisha” (lightpellets, Packaging: 3kg, 5kg and 7 kg)
- “Red Cat” (light pellets, Packaging: 3kg, 5kg and 7 kg)
- “My Cat" (gray pellets, Packaging: 3kg, 5kg and 7 kg)
- Sales of catlitter by weight in any quantity


4. Beddingand feed for rodents:
- “Hamster Love” (lindenshavingsbedding, packaging 400 g)
- Selectedhay (bedding and feedfor rodents, packaging 300 g)


5. Grill set:
“Grill Set” (alternative to coal) includes:
6 RUF Briquettes
1 Solid Fuel Tablet
1 Box of Matches
Note: strict observance of the instruction for comfortable and correct preparation of coals

Annual sales, $

320000

Annual net income, $

120000

Organizational form

LLC

Number of employees

55

Problem or Opportunity

After negotiations

Solution (product or service)

European winter storage
All math and figures are taken from personal experience obtained during last year
Pellets sales market- Europe
Pricing policy of sales - summer 90€ winter 110€ Big Bags
Purchase of pellets - summer 72€, winter 100€
Income concept  - to buy pellets in summer,  to sale in  winter
Value of the product:  Any Certified volume available in stock is sold in winter
Turnover: 330000€ - first season,  800000€- second season. Turnover depends only on how early the purchase of pellets began and the availability of money supply.
Dead season for biofuel : June - August, as the price falls.
Payback of the project 2-3 seasons.

150,000 – 250,000 storage
30,000- 50,000 refinement depending on the condition of the roof
18,000 forklift
5,000 cameras, doors, alarm
1,000 weight checker
288,000 Purchase of pellets including VAT
Working staff : Forklift driver 160€ /month, packers
Total : 342,000 – 492,000
Risks and advantages
1.    No salary risks (very important)
2.     Poorly made roof can soak 2-3% of the total volume of pellets stock
3.     100% claimed goods
4.    It is possible to open separate SP for removal of external risks.
5.    Theft of pellets (unlikely, as everything is in big bags) impossible to take away by ordinary car, only control persons have the keys.
6.    Poor quality products are excluded by 2 factors: 1- verified suppliers, 2- incoming inspection
7.    Large customer base
8.    Deliberate arson (decision - to insure against fire)

Competitors

There is no such business model in Belarus today. And it can not be copied.

Advantages or differentiators

A profound work on on the formation of suppliers and buyers have been done

Reason for sale

to start the second project

Market

The volume of pellets consumption in this period is 22mln tons, until 2020-45mln tons

Videos

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