Gravel Pit Business Plan and SWOT Analysis

Gravel Pit Business Plan, Marketing Plan, How To Guide, and Funding Directory

The Gravel Pit Business Plan and Business Development toolkit features 18 different documents that you can use for capital raising or general business planning purposes. Our product line also features comprehensive information regarding to how to start a Gravel Pit business. All business planning packages come with easy-to-use instructions so that you can reduce the time needed to create a professional business plan and presentation.

Your Business Planning Package will be immediately emailed to you after you make your purchase.

Product Specifications (please see images below):

  • Bank/Investor Ready
  • Complete Industry Research for the Industry
  • 3 Year Excel Financial Model
  • Business Plan (26 to 30 pages)
  • Marketing Plan (24 to 28 pages)
  • 425+ Page Funding Directory
  • PowerPoint Presentation
  • Loan Amortization and ROI Tools
  • Three SWOT Analysis Templates
  • How to Start a Business Guide
  • Easy to Use Instructions
  • All Documents Delivered in Word, Excel, and PowerPoint Format
  • Meets SBA Requirements

While gravel pits are not the most exciting businesses in the world to own and operate, they are able to produce highly predictable streams of revenue on an ongoing basis from the sale of rocks and gravel to the general public as well as to contracting businesses. These companies remain in demand especially in areas where new constructions are continuous. Gravel serves a number of purposes as it relates to construction as well as landscape contracting. The barriers to entry for these types of businesses are considered moderately low given that it is simply just the acquisition of land that is needed that has the ability to produce gravel. One of the ways that these businesses are able to develop their revenues very quickly is by establishing relationships with driveway contractors, paving companies, construction businesses, real estate developers, and landscape contractors.

The gross margins generated from the sale of gravel are considered to be low and the usually range anywhere from 10% to 20% of the total order. The startup cost associated with the new gravel pit typically range anywhere from $250,000 to $1 million depending on the amount of land that is being purchased in conjunction with this business. The operating costs are considered to be moderately high given that there is a significant amount of labor that goes in to not only producing gravel but also delivering it to its specified destination. These businesses are only moderately sensitive to negative changes in the economy given that people are going to continue to need gravel for their homes, driveways, and other real estate and land focused applications.

A gravel pit business plan should be developed that features a three-year profit and loss statement, cash flow analysis, balance sheet, breakeven analysis, and business ratios page. As it relates to the gravel pit industry – there are approximately 1,400 businesses within this market that provide jobs to about 50,000 people. Each year, these businesses generate about $15 billion in revenue. Although this is a significantly large industry, the gross margins do not make it overly profitable.

A gravel pit marketing plan is usually developed in conjunction with any type of business planning document documentation. As it relates to marketing, this can be done on a somewhat limited basis given the demand for gravel primarily exists with commercial enterprises such as contractors and real estate developers. As mentioned above, these businesses typically generate a significant amount of their revenues directly from ongoing purchase order relationships that these companies have with third-party businesses. Of course, it is important to maintain a proprietary website that showcases the gravel products offered by the business so the individuals that are searching online for these products can quickly find the business in place in order for delivery. There are many homeowners that do much of their own repairs and landscaping and as such it is important that the business maintaining certain level of visibility among the general public. Print advertisements are frequently distributed among local and regional trade journals that focus on the needs of landscape contractors as well as driveway contractors. This can be one of the quickest ways of the business is able to develop its revenue base.

My imperative, some gravel pits have taken to maintaining a very small presence on social media platforms such as FaceBook, Twitter, Google+, and related platforms. Usually, the owner enrolls the business in a number of community focused websites that focus on landscape contracting, new residential development, and other matters that pertain specifically to land improvements.

As it relates to raising capital, nearly all lenders and banks are willing to put up the necessary capital in order to acquire the land, equipment, and delivery vehicles for a gravel pit. One of the best things about this business is that there is a significant amount of access to money given that the vast majority of the funds or use are for the acquisition of land and tangible furniture, fixtures, and equipment. It can be expected that the entrepreneur is going to need to put up a 10% to 20% down payment against any credit facility that is being sought. One of the ways of these businesses frequently expand this by acquiring a working capital line of credit allows us worst many different types of gravel and rocks that are not directly produced by the facility. This can be one of the quickest ways of the business can expand its operation is through the sourcing of specialty stone products through third parties.

A gravel pit SWOT analysis should be produced as well. As it relates to strengths, the gross margins wall low are able to produce a significant amount of profits for these businesses on an ongoing basis. Additionally, once these businesses are established and they are able to produce a significant amount of highly predictable streams of revenue will not having to deal with very many competitive issues. There are usually only a handful of other gravel pit companies in any given regional or state-based market.

For weaknesses, the operating expenses associated with this type of company are very high given that there needs to be a number of employees on staff that are able to properly produce and prepare orders a gravel for delivery. Additionally, there are a significant amount of liabilities and insurance costs associated with operating the save the business on a day-to-day basis.

For opportunities, gravel pits can readily expand by simply acquiring additional parcels of land from which gravel can be extracted and distributed. As stated earlier, nearly all financial institutions are willing to put up the necessary capital that will allow these businesses to expand once they reach profitability. Private investors are also another option for these businesses to expand once you have reached profitability given that they do provide a strong return on investment as it relates to the underlying equity.

For threats, there’s really nothing major that would impact the way that these companies conduct business moving forward. There’s always going to be a demand for gravel among homeowners, property managers, real estate developers, landscape contractors, and other entities that use these raw products in the course of their business operations. This is a business that can face some challenges as automation occurs given that robotics can mimic the gravel producing movements of a human being. However, it will be quite some time before mechanized labor takes over this aspect of operations.