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Ready business plan sawmills “Pili-Saw”

1. SUMMARY OF THE PROJECT
The purpose of the project is the organization of a sawn timber enterprise (“Pili-Pila”) in the Autonomous Republic of Crimea, in the immediate vicinity of Simferopol. The prerequisites for the development of the project are: a shortage of affordable building materials in the republic due to the lack of land communication with the mainland; lack of established supply chains from Russian manufacturers; implementation of the state program for the development of the republic related to the development of infrastructure, housing, etc .; increased interest of private investors in construction in the republic.

Lumber is one of the most widely used building materials, which can be used for exterior and interior decoration of buildings, when installing floors, stairs, roofs, etc.

The technological chain of production organization includes the supply of round timber, its sawing and planing in place. Sales – in bulk at regional building materials bases. A certain amount can be sold by self at retail.

A limited liability company was chosen as the legal form; form of taxation – STS.
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The project is attractive for investment, which is confirmed by integrated performance indicators calculated taking into account all costs and the planned revenue of the enterprise.

2. DESCRIPTION OF THE INDUSTRY AND COMPANY
To date, there is information in open sources about only one lumber producer throughout the republic, located in Dzhankoy. 97% of lumber comes to the Crimea in finished form from suppliers on the mainland. Moreover, their cost is on average 55-65% higher than the cost of similar materials in other regions of the Russian Federation.

At the same time, the pace of construction is growing. According to the government program for the development of the republic, the territory of Simferopol should be expanded 7 times. In addition, the volume of construction and reconstruction of tourism infrastructure is increasing. Organization of a free economic zone (SEZ Crimea) makes the region attractive for investors from other regions.

At the same time, from 50 to 70 bases of building materials that sell edged and unedged sawn timber wholesale and retail are present and successfully operate in the region. Deliveries to them are carried out from manufacturers of “forest” regions of the mainland of the Russian Federation. All these organizations are potential consumers of the products produced by the project. The total consumption of lumber in the republic and the city of Sevastopol is estimated at 12-15 thousand cubic meters per month.

The most popular type of product is edged board, which has a wide range of applications. Then – a beam, a planed board, a block house, imitation of a beam, etc. Edged boards account for at least 65% of the total market volume or 8.5 thousand cubic meters. In the coming years, stable demand growth is expected in the range of 5-10% annually.

Much attention is paid to the choice of supplier. The selection was made according to a number of parameters: quality and price of the material, convenience and cost of logistics, stability of supply of the required volumes. The production is supposed to be located no further than 5 km from the Simferopol – Gruzovoy station, which will be most convenient from the point of view of logistics organization, as transportation of raw materials is supposed to be carried out by rail.
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The production facility is selected primarily from the point of view of the possibility of implementing the technological cycle, manipulating workpieces and finished material with a length of 6 m, etc. Loading equipment is leased. Given the seasonal nature of the demand for the products in question, this is a more economical option than acquiring a property.

The main sales channel is the wholesale supply of lumber to building materials bases located on the peninsula. The minimum order quantity is 30 cubic meters. Delivery is organized by Pili-Pila LLC with the involvement of a transport company or private carriers. In addition, it is possible to sell the goods in retail, subject to pickup.

Investment costs include, first of all, the purchase of technological equipment and the costs of forming the initial stock of raw materials.

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