Natural Stone < Building Materials For Construction

Natural stone business can be regarded as capital intensive industry and low capital investment industry. Capital can be obtained from venture capitalists, banks and non banking financial institutions. A good project report should contain assurances from suppliers, marketing and advertising capabilities, demand and supply reports, retail spaces or retailers, end consumers demand report and at the end it would be very good if you have some assurances or contracts from demand side like construction houses, large retailers, etc. There are many options to natural stone businesses such as mining, retailing, transportation (remember natural stone business needs specific and high quality transportation equipment and personal), marketing and advertising, storage, processing, curing, building materials etc for which capital can be secured or obtained from various financial institutions.

Basically natural stones are catered for construction and decorative needs. Decorative stones are very much popular in jewelry. Diamond is by the most famous and expensive natural stone. Diamond industry is a capital intensive industry. Margins are huge for diamond business because of small number of established players. Jewelry stones have a popular demand among the consumers. Production is low for jewelry stones because of extensive refining and low availability in natural. Africa is considered to have huge reserves of diamonds and other precious natural stones and India is the highest consumer of Gold and natural stones building materials. It is important to know the sellers and buyers for a new entrant. Good margins are available to importers, exporters and middle man. A middle man in this business negotiates and stands guarantee between the buyer and seller.

Building and construction industry uses a huge range and variety of natural stones such as Marble, Slate, lime stone, Granite, Sandstone, Quartzite, Mosaics, pebbles, etc. Construction industry uses some of these stones for decorating purposes. Cost of these natural stones materials varies according to quality, shape, size and quantity ordered. Large construction industries have long term contracts with suppliers and producers to avoid fluctuations in supply and to have stability in pricing. If a new entrant wants to enter into natural stone materials business he needs to have good contacts and deals which ensure him constant supply demand ratio. There are other various special stones which are suitable for a particular type of region. Temperature stones are used widely because some countries have high temperatures and other regions have low temperatures for which a suitable stone needs to be selected. Marble is one such kind which exhibits cooler temperature even in summer season and during winters it gets worse because it gets much cooler than other stones.

Before starting any business one needs to consider the risk involved. Natural stone business reduces the risk of doing business. One of the most important aspects of this industry is risk which is reduced due to various factors. Natural stones can be stored for years together without any visible defect. Care should be taken so as to reduce the exposure of these stones to potential harmful (air and water) pollutants and harsh water which may cause harm to natural stones. Most importantly inventory does not loose its value with time. This makes the business potentially very beneficial to long term players. There are many established companies and very few small and medium scale business which are offering value as retailers and suppliers. Business cycle is not seasonal but it is entirely dependent upon construction business and economy ups and downs. Real estate sector and demand for new homes will be constantly growing due to population growth which in turn is offering better returns to the natural stone business. Natural stone business is growing at a very decent healthy rate and future demand is likely to be good. Mining is a profitable venture for new entrants.

Storage and transportation industry offers good business opportunity due to complexity and regulations in transporting natural stones building materials. Precious natural stones need special protection and natural construction stones need large storage spaces. Trucks transporting natural stones need special drivers and equipment. Also these trucks can transport only few stones and volume can be met only by frequent playing of stones from end to end destinations.

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Building And Construction