How to open a business for the production of rubber products (RTI)

* The calculations use the average data for the World

Rubber products are used in many fields of human activity. Rubber is used in the largest quantities in the production of car tires and tires, however, this is only a small part of the production of rubber-based products. A wide range of diverse products are rubber products that are used everywhere - in construction, in the automotive industry, in the laying of communications, in the economy. A separate group are vulcanized rubber products, which are represented by tubes, sleeves, hoses. An entrepreneur who decides to open his rubber-based production usually chooses between the production of car tires and the processing of tires that are already unusable (the second is even much more relevant), but you can turn your attention to the manufacture of many other products that are also very popular among people.

However, it is worth noting that many rubber products are indispensable in many industries, so there are a large number of manufacturers of such products on the market. An entrepreneur who has decided to open his RTI manufacturing plant should expect that he will have to compete with enterprises located in all cities of Russia; moreover, a certain percentage of rubber products comes from abroad. That is, the market is practically not lacking in supply, and therefore, in order to take its place and stay in the market, it is necessary to offer consumers excellent quality combined with an adequate price. Or, in general, enter the segment of cheap products, although rubber products for the most part are not too expensive for the end user (which distinguishes them from tires that are expensive for a set, and price often becomes a determining factor). Moreover, the entrepreneur should focus not only on the end consumer, but also on his intermediaries, who also need to offer favorable conditions for cooperation. Many of them have established relationships with manufacturers, so it will be difficult to convince them to abandon contracts and move on to a new agreement. Savings in transportation costs can help, therefore, if there is no plant for the production of rubber goods in the city, you can count on the fact that its products within the region will be cheaper than competitors. But do not forget about the big players who, due to the huge scale of production, can reduce the cost of their products by several times, and a novice businessman with a small plant will still not be able to offer a more profitable cost - do not work at a loss to him.

If we recall such a mysterious country as China, we can understand that it delivers products cheaper than Russian counterparts despite the fact that transportation and customs costs are added to the cost. All due to cheap labor and colossal volumes of production. True, the quality does not always correspond even to such a low price. In general, before starting work, you need to conduct a full-fledged market research, find out the offers of competitors, evaluate the quality of their products, collect feedback from end consumers and intermediaries, then analyze your capabilities and identify prospects. It may well turn out that they will not be, but sometimes RTI is imported into the region from other regions of the country. At the same time, for the assortment, intermediaries can purchase products from different manufacturers, because it is not always possible for a plant to supply absolutely all positions, and a difference in quality is also needed to offer customers with different financial capabilities. There are chances to enter the market, but is it worth trying - you need to analyze it in each case separately.

To get started, you need to register as a business entity. Any form of entrepreneurship, an entrepreneur can register as an individual entrepreneur, but if there is a need to register a legal entity, it is preferable to open a limited liability company: IE and LLC have the exclusive right to use a simplified taxation system, therefore they transfer 6% of income to the state or 15% of operating profit. Some special permits and licenses for such products are not required, although there are state standards for rubber products, and the owner of the plant can select a recipe and produce products that are suitable for these standards. However, GOST has lost the binding character for a long time, and therefore the entrepreneur is not limited by anything. Another question is how high quality and satisfying consumer demand these products will be.

The following is a search for a place for your production. To save money, a businessman can work outside a large city, but not far from it to save his transportation costs. It will take a fairly large area, but the exact size cannot be called - it all depends on the volume and range of products, as well as on the complexity of the production of the selected product range. It will require the erection of buildings, a whole complex of structures, therefore, first of all, you need to consider proposals for the sale of already completed plants, which can simply be converted to fit your needs. An entrepreneur needs an area with several buildings to house warehouses, a production hall and an administrative building. Of course, buying land with buildings will cost several million rubles, and sometimes you can consider proposals for renting real estate. Although usually the cost of renting becomes too much for monthly expenses.

Next, you should purchase equipment for production. The number of machines and their functionality depends on which products will be manufactured. The production technology is also important, because today for many types of products there are several methods of production. Some allows you to get a cheaper product, some improve quality. You also need to consider the raw materials used. In most cases, rubber products are made from natural or, more often, synthetic rubber, the latter is much cheaper, and its characteristics are not much inferior, but much depends on the producer of raw materials. Many rubber goods are made from rubber crumbs or other recyclable materials; in general, an entrepreneur has several opportunities for developing his business, depending on the means available.

At first, it will almost certainly be inadvisable to open a large production, it will be enough just to try to enter the market, and this can be done even with small volumes of production. The main thing is to have an important competitive advantage, this may be the price, quality or supply of atypical, but demanded products. Equipment usually consists of several machines, because a rare product can only be made on one machine. Also, special molds for manufacturing, which vary for each commodity item, are almost always required. For molded rubber products, two types of machines are purchased - extruders and calendars. With their help, a blank is obtained - a sheet from which a part of the desired shape and size is cut.

The cost of a calender is at least 500 thousand rubles, an extruder for rubber will cost almost twice as much - from 900 thousand rubles. The price of equipment differs depending not only on capacity, but also on the maximum size of the workpiece. It should be noted that Chinese manufacturers offer the lowest price, so it makes sense to contact them and clarify all questions. Many of these companies have Russian representative offices, so there is no need to transport sophisticated equipment, in which case they will assemble it in Russia. You also need to take into account the timing of the manufacture of machines, which can be several months, although with a good combination of circumstances, the units may already be available.

For vulcanization of rubber, other devices are required: a vulcanizing press and a machine for rolling and extrusion of rubber. With their help, you can get a large number of various products, but here you will also need special forms. The cost of the press starts from 400 thousand rubles, the installation will cost much cheaper - 150-200 thousand rubles. However, such equipment allows you to get products exclusively from rubber, and to get more complex products you will have to purchase additional machines. This is necessary for applying reinforcement or winding of metal or other materials that are not similar in structure to rubber. Here, in each case, additional equipment is selected that will perform certain tasks.

Rubber is also used not only as a material for the manufacture of finished products, but also for the creation of rubberized fabrics, and in production for the production of seals and gaskets, lead oxide, asbestos, gasoline and special fillers may also be required. Here, in addition, a syringe machine is required. At the same time, a conveyor for the continuous process must be installed at any production facility, as well as special loading machines (forklift trucks) for prompt removal of the finished product to the warehouse.

Also in production, you may need to create your own laboratory department. It will select the composition of raw materials for each type of product so that it becomes possible to improve the properties of manufactured products. In some cases, it will really be enough to buy ready-made raw materials and use it as a basis or add the recommended fillers. However, it may be necessary to derive its own formula for the composition of raw materials, because no manufacturer will say exactly what raw materials and in what proportions he uses, which means that a novice entrepreneur is forced to invest in his own developments. The laboratory department will also allow to find previously unused combinations of materials and thus obtain a more perfect product - and this means improving the competitiveness of the enterprise. In any case, investing in science, finding new methods of production has always been a very costly but promising direction.

Serve production should be a whole staff. First of all, these are machine operators, they must be specially trained people who can cope with even simple, but responsible work. Warehouse workers, supervisors and people in administrative positions are also required. An entrepreneur himself can take on the position of director of an enterprise, but each department needs to have its own manager. Also, drivers may be required if the transportation of finished products to the consumer is supposed.

It is worth taking care of ensuring security at the enterprise, for this you can create your own security service or contact a third-party private security organization that will signal the company, monitor the situation and, if necessary, send your people in case of an alarm. Also, a private security company usually obliges several of its employees to constantly be on duty at the enterprise. All business processes that are not related to profit-making by an organization should be outsourced. This primarily includes accounting, tax and legal advice (if necessary), cleaning services. At the enterprise, you can organize your own purchasing and sales department, marketing and logistics departments - but they are needed or the manager himself can handle these tasks, the entrepreneur himself determines.

To sell your product you need to immediately look for intermediaries - large distribution companies and dealers who will purchase goods in small and large wholesale. The enterprise itself is unlikely to be able to work in retail, although with a sufficiently large range and additional funds, you can open your own store with the presented products. However, this is possible, as a rule, if the company produces the most diverse product, and this should include consumables (bushings, gaskets, washers, belts), as well as independent types of products, for example, garden hoses. Otherwise, the customers in the store will be too few to provide its content. In any case, this option for business development is best considered in the future, when work with intermediaries has already been established and the product has stable demand in the market.

In order to sell goods to wholesale buyers, it is almost certain that it will require the involvement of sales representatives and sales managers, although the entrepreneur himself can contact potential buyers to provide a commercial offer. You can also work directly from the buyer, that is, by his order to produce a certain batch of goods, but not every company is interested in this type of cooperation, because the intermediary wants to receive the goods as soon as possible. Moreover, it may be inconvenient for the manufacturer.

For its presence on the market, you can order the creation and promotion of a site, however, the total amount for this service can be 100 thousand rubles.

Usually, if there are no more manufacturers of rubber products in the region, it is relatively easy for an entrepreneur to reach small wholesale buyers, today RTI is used in completely different fields, so you can start from small points of sale for automotive supplies and up to large garden supplies stores and construction companies. It may turn out that there will be no large wholesaler in the city, so it makes sense to start looking for partners in the nearest regions or in the whole country, the main thing is to offer the most favorable conditions. But even in this case, not every wholesaler will be interested in an offer, because a new product can not always quickly find its buyer. In general, the wholesaler is always primarily interested in the price, the quality is directly evaluated by the end user.

The opening of its enterprise for the manufacture of rubber products will cost several million rubles, if it is supposed to buy land and build buildings, then you need to count on several tens of millions. It is impossible to name the exact amount, each businessman determines his abilities depending on the available funds, but it’s still not worth saving on quality, and it’s better to open a small line that produces inexpensive and high-quality goods than to start with a large plant that is allocated only by production volumes, but it has a lot of marriage. RTI itself, as already noted, does not differ in great cost at retail, therefore, it is initially necessary to produce goods with low cost, since synthetic rubber and other raw materials are relatively inexpensive. However, in some areas, for example, in construction, it is high-quality rubber goods that are valued, but parts that often consist of not only rubber but also metal are often used there. This direction can be very promising, but only when the entrepreneur is constantly analyzing the market and sees the possibilities of its development. But in this area they are not always there.

Matthias Laudanum

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08/18/2019


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