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Gravel Rock Products Business Plan

A complete business plan for Durango Gravel

About this business plan

Durango Gravel, Inc. produces and sells types and grades of gravel to public and private customers in the Four Corners Region, concentrating on the area around Durango, Colorado. Durango Gravel seeks to expand its existing market niche by becoming a major supplier to the asphalt paving companies in the Four Corners area. We reached profitability in Year 1.

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Executive Summary

Durango Gravel, Inc. produces and sells types and grades of gravel to public and private customers in the Four Corners Region, concentrating on the area around Durango, Colorado. In just five months of operation, we operated at a profit, recording $250,000 in sales and selling almost 49,000 tons of gravel products.

Our goal for this year is to penetrate the asphalt market, with its high profitability and limited competition. By adding an asphalt plant, and meeting our minimum goals of 45,500 tons of asphalt, we plan to sell over 191,000 tons of gravel products to municipalities, contractors and end-users, with sales of over $2,696,000 and net profits of $854,000.

We have experienced significant success penetrating the local market by offering superior products and customer service.

Our keys to continued success are:

Expanding into the asphalt market.
Establishing and maintaining working relationships with major institutional users.
Exploiting the coming void in gravel supplies to establish a market niche.
Developing a net profit margin above 30%.
Effectively communicating to our existing and potential customers, through targeted efforts, our position as a differentiated provider of the highest-quality gravel and asphalt products.

1.1 Objectives

The objectives of Durango Gravel, Inc. for the coming year:

ASPHALT

Establish strategic working relationships with the major asphalt users in the area.
Develop initial sales of 45.5K tons of asphalt, resulting in first-year sales of $1,638,000.
Increase Sales over a three-year period to 77K tons per year.

GRAVEL

Continue to develop strategic working relationships with the 10-15 major institutional users.
Hit target gravel sales levels of 145.5K tons of both road base and screened rock, resulting in gravel sales of $1,064,000.
Continue to exploit the weaknesses inherent in the major area competitors to increase our presence in the local market area.

1.2 Mission

Durango Gravel, Inc. serves municipalities, construction companies and individual users by providing superior-quality products manufactured to the highest standards at competitive prices.

Our principals have a history of valuing relationships with their customers. We communicate our commitment to quality and customer appreciation through outstanding product quality, personal service and efficient delivery. Our commitment to our customers is reflected through honest and responsible business practices.

1.3 Keys to Success

The keys to success for Durango Gravel, Inc.:

Establishing and maintaining working relationships and contractual agreements with municipality and business sector clients.
Increasing our facility to maximum production within the next three years.
Continuing our position as a customer-service-oriented company with competitive pricing.
Increasing our profit margins and decreasing our production costs.
Developing a presence in the asphalt market with area users.

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