Your business: how to become a dealer of plastic windows

* The calculations use the average data for the World

Unfortunately, the current situation in the market of metal-plastic windows (and with them doors, facades, etc.) can be described only by one, not very (watered) correct phrase about the circus who left and the remaining troupe. In this situation, a circus should be understood as the state of the industry when the invested efforts correspond to the profit received.

A small digression into history. The first metal-plastic windows in Russia appeared in the mid-90s, and the rapid growth of the market fell in the mid-2000s. Over time, business profitability has fallen. If in 1997 a set of equipment for the production of window and door structures brought from Turkey fought off in a matter of months, then the payback of production - with the right approach - in 2005 was on average 2-3 years. And if at that time the market was just beginning to actively saturate, then by 2015, saturation probably reached its maximum. About 80% of the private housing stock was glazed, the old wooden windows were replaced with new metal-plastic ones; the most active consumer, instead of individual repairs, was new construction. And all this against the background of the fact that only the lazy did not work in the field of metalloplastics: in 2007, during the three summer months, at least 30 new manufactures of metal-plastic constructions were opened in the Rostov Region alone. Another question is how quickly they had to curtail their activities. Units lasted more than a year. And the point here is not at all a crisis that has struck. The common belief is that the windows can earn big and fast money. But, unfortunately or fortunately, the golden time of manufacturers of plastic windows has gone forever. Given the extremely fierce competition in the industry, the usual dumping was not enough; Those wishing to earn on the total illiteracy of the population curtailed production in three to four months. Those few who tried to produce honestly and by the rules stayed afloat a little longer - the costs turned out to be too large, and the profits low.

So, producing has become unprofitable. But in the crisis year of 2008, the market is still, albeit slowly, but growing. And by 2009 (in Moscow a little earlier), the market for ready-made window dealers began to develop in a boisterous color.

A dealer is an enterprise that does not produce products, but has the ability to successfully sell it. In other words, by the end of the 2000s, a completely logical diversification of the business occurred - the production and sale of metal-plastic structures were divided. Why is this logical? Just because it’s impossible to cover everything at once. None of the car manufacturers, for example, have their own car dealership network.

So, in this case, the dealer is an organization or entrepreneur, acting as an intermediary between the consumer and the manufacturer. Depending on the terms of the contract between the manufacturer and the dealer, the manufacturer can also carry out installation work. Thus, the dealer bears absolutely minimal costs, distancing himself from any technical issues.

On this, in fact, is the division of labor. A production company, having the ability to survive only at the expense of a solid production volume, accumulates orders of several (sometimes we are talking about dozens) dealers. The dealer, having one or more outlets and not incurring large costs, has the ability to survive with a relatively small volume of sales.

Often the dealer business becomes a family affair when the spouse takes orders at the office, the spouse performs the technical part of the work, and so on. In this case, the business becomes much more profitable. Some entrepreneurs work safely even without a sales office. Starting from the glazing of friends and relatives, they earn their recommendations and reputation, and, consequently, an ever-growing circle of customers.

In our case, we will consider an averaged version of such an enterprise - with an office and its own installation team.

Let's start with the necessary starting investments. To transport the finished structures, we need a car - the on-board GAZelle is suitable, which we independently equip with the so-called "pyramid" - a vertical stop for transported windows. A used car today can be purchased for 350, 000 rubles. "Pyramid" - not more than 10, 000 rubles. A set of tools for installers - a puncher, a couple of glass jacks, a screwdriver and other men's joys - this is about 70, 000 rubles. Equip the office with furniture, a telephone and a computer - 30, 000 rubles.

You will also need working capital, as in our averaged version, we assume that the dealer must pay 100% of the cost of the product to the manufacturer until the final settlement with his client. The volume of working capital will depend on the planned monthly revenue, which we will calculate below. Investments in advertising at the start-up stage, given the high level of competition in the industry, should be significant: it is desirable to have at least the simplest website (20, 000 rubles) and a massive advertising campaign in the specialized press for one to two months immediately before the high season. In each city there are advertising weeklies, long since chosen by window workers; no need to look for new ways - those who want to order a window will open this publication first. A one-time exit in 1/8 of a band, depending on the city, will go from 10 to 25 thousand; for an average million-plus city, we take an amount of 15 thousand per issue or 60 thousand rubles per month.

In monthly expenses, it is necessary to take into account the cost of renting a retail space - 25, 000 rubles, utility bills and communications, fuel and lubricants - 20, 000 rubles. Advertising - in the coming months it is advisable to use a smaller module - 30, 000 rubles.

The organization’s staff and payroll should look like this:

No.

Job title

Number of people

Rate, rub.

Total RUB

one

Sales Manager

2 (shift)

25, 000

50, 000

2

Installer

2

30, 000

60, 000

3

Measurer

one

30, 000

30, 000

four

Accountant

one

20, 000

20, 000

Total:

160, 000

Often, the entrepreneur himself assumes the function of a measurer or sales manager, but we will not take this into account in our calculations. There are enough installers with work experience on the labor market today, but if you suddenly cannot find them, manufacturers of specialized systems, accessories, and even window manufacturers themselves conduct regular free training on technology.

Summing up the received figures, monthly expenses will amount to 235, 000 rubles.

Despite the fact that often consumers bring the cost of a window to the cost of a square meter, this is categorically incorrect. The cost per square meter can vary significantly depending on the configuration of the structure used fittings, glass, etc. Therefore, the unit of measurement that more accurately reflects the sales volume of the window company is the so-called conditional window unit - a two-floor window with a blind and tilt-and-turn parts, measuring 1.4x1.4 m (less often - 1.5x1.5 m). It is this type of window that makes up at least 50% of all translucent walling in Soviet-built houses.

The average market value of such a window is from 8, 500 to 12, 500 rubles. depending on accessories. For the convenience of calculation, we take a value equal to 10 000 rubles for the design. In the first two or three months, we can talk about sales of 30-50 conventional window units per month, which will amount to 300-500 thousand rubles of revenue (which will be equal to working capital). After about a year of operation, one outlet can bring 1.2-1.5 million rubles of revenue per month. With a standard dealer discount from the retail price of 20-25%, this will mean 240-300 thousand after covering direct costs or from 80, 000 rubles of net profit. The payback period of the project is 12 months.

It is certainly more convenient to choose an individual entrepreneur as a legal form and, working under a supply agreement, a simplified taxation system.

Of the specific nuances of the industry. According to established tradition, the initial prices for structures are inflated in order to provide the client with an “individual discount”. When choosing a supplier, one should pay attention to the whole range of its characteristics (in comparison with its competitors): cost of products and offered dealer discounts, used components, list of services offered, delivery time, duration of stay on the market, availability of warranty if found during installation or after marriage, the availability of training for sellers and installers. The window market is not a place for rash creative in advertising; the most effective and proven means of communication with the client are one or two advertising publications, accumulating up to 80% of all window advertising. Installation according to GOST assumes the presence of not only a sealing tape between the window and the stand profile and installation using anchors, and not just “foam”, but also the presence of vapor barrier tape from the side of the room and waterproofing tape from the side of the street. You can increase profits by expanding the range of designs of their aluminum; however, it is a specific product with its own target market.

To summarize, we can talk about the following. Despite the optimistic figures, it is necessary to remember the market saturation, high supply and falling demand. The only market segment that is still holding positions - new (or object) construction - is actually closed to non-producers due to stringent price requirements. Nevertheless, the long-term rapid development of the industry in our country allows us to adopt the positive experience of our predecessors and take into account their mistakes in order to create a truly effective and profitable enterprise.

Denis Miroshnichenko

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08/18/2019