|Who Is Making Money With Cart-Away Concrete?|
The Cart-Away Concrete
For the past 40 years, businesses have added small concrete systems and trailers to their services to add profits and expand their customer base. Over the years the customer profile has evolved from the occasional do-it-yourselfer to a much broader group of users. And over these many years the equipment has evolved from dirty, slow and impractical, to the modern dry material dispensers and rotating drum mixing trailers of today. In the 70’s a customer had to wait for twenty minutes to get a yard of concrete that today takes only two minutes to load. The quality of the concrete has improved dramatically as well with the introduction of the rotating drum trailer. Just ten years ago a customer would pull a tub trailer to the job site only to find most of the rocks were at the bottom of tub. Today’s modern mixing trailer delivers a superior ready-mix concrete with the convenience of a ready-mix truck.
As the quality of the concrete has improved so has the quality and quantity of customers who use this product. Now a full 63% of the customers are contractors of some sort. 31% of the users listed are do-it-yourself shoppers and 6% are city or county municipalities.
Of the 1500 yards per year that an average location will produce a year, just under 950 yards will be going to the highest of all repeat customers, the professional contractor. Repeat users make up 84% of the Cart-Away Concrete sold, so there are multiple visits to the location, opening many other sales opportunities. In fact, of all repeat concrete customers, 32% use the concrete service at least every month, with 36% using the service every week, at least.
Adding to the pool of customers each year is the first time user.
The first-time customer represents 16% of all concrete sales and highlights the value of ready-mix as a “customer magnet”.
Why is the Cart-Away Concrete customer important to a business?
Besides bringing hundreds of repeat concrete customers through the gate every year, survey results demonstrate that 5% of concrete users say that concrete was their first purchase at the location. The conclusion that can be drawn is that from the 800 to 1000 concrete users through the gate, there are approximately 40 to 50 customer captures completed. Each location that is considering concrete should calculate the value of this additional market capture. The results of this study discovered that there is great value in capturing a concrete customer. 68% of respondents answered that they where 100% loyal to the location with concrete. 31% indicated that convenience was the critical factor in selecting a Cart-Away provider, which points to the advantage of multiple concrete locations within a region to maintain market share.
Another positive business factor is the value of ready-mix in building additional revenues for the enterprise. Concrete projects require many additional materials, tools and supplies to complete. This brings many opportunities for add-on sales. A full 92% of ready-mix concrete purchasers also purchase or rent other items from their concrete supplier. Of these sympathetic sales or rentals, 67% are the larger site preparation equipment like tractors, compactors and compressors. And 25% of add-on revenues come from hand tools that the respondents listed as trowels, vibrators, form stakes and wheelbarrows. Any business evaluating concrete should measure the value of 800 to 1000 concrete projects a year, then add tens of thousands of dollars in extra revenues to all ready-mix sales.
As revenues are calculated it is important to note that average concrete revenue is $90. per yard and profits are 50% or better.
Surveyed locations found that daily sales of ready-mix are at 6.3 yards. Depending on the available construction season, 270 days of production (factoring a 7 day operation and 9 month season) could result in 1700 yards or $153,000. per year in revenues.
A study of the value of concrete should include the benefits of capturing many new customers, keeping loyal customers, adding over $100,000. in concrete sales and adding that much or more in sympathetic sales revenues.
What is this concrete used for?
Most of the respondents said that they use concrete in a trailer whenever they need less than 3 yards or if time is critical. These two reasons are exactly what caused this niche to be introduced 40 years ago. High short-load fees and transit-mix truck scheduling delays result in increased concrete costs and reduced profits for many contractors. The survey found that pouring a slab (56%) is the most popular use for concrete out of the trailer. Both contractors and do-it-yourselfers listed driveways, patios, spa support and shed slabs as the most common slab that they pour. Sidewalk repair (27%) and underground construction (20%) are the main use by contractors and municipality customers. Other projects listed include, footings, fence posts and mow strips. As the community finds this resource is available to them, they begin to complete projects that they would have postponed or canceled because of short-load fees and transit-mix inconvenience. In most of these communities there is a large pool of potential customers with the skills to complete these small concrete projects. It is also clear that referrals are an important source of new concrete business, with 9% saying that buying concrete at this location was recommended by someone else. Partnering with local transit-mix companies results in most of the referrals that a trailered concrete location will receive. Dispatchers from the large ready-mix firms will add to customer capture and ultimately the extra revenues of the Cart-Away operation.
How do the customers find this concrete?
Regular customers are the best source of ready-mix sales at 60%. This makes it critical that proper signage and counter sales presentations are made apart of any marketing plans. Signs on entry fences, on cement silos and behind the sales counter introduce this service to regular customers. Invoice stuffers, telephone “on-hold” messages, counter reminders and grand openings also build sales for the regular customer base. Of the first-time concrete users surveyed, 20% indicated that they where referred by someone else, demonstrating the value of word of mouth.
Though the survey did not completely bear this out, it is important to be listed in the Ready-mix concrete section of the Yellow Pages. Many of the new concrete customers traditionally come from searching in the Yellow Pages.
Why a Cart-Away System?
There is little question as to the success of adding ready-mix concrete to any construction related operation. Your success in this niche will be the result of your own efforts combined with a strong support team. For the past 18 years Cart-Away Concrete Systems has supported the most successful concrete operations in this industry.
This survey and report is only one of the extra services that operators have come to expect from Cart-Away. Ready-mix concrete production is as much art as science and real-life field experience is critical to your success. Many equipment manufacturers, anxious to sell you mixing equipment, have never operated a ready-mix business. In fact, the support team is as important to your success as the selection of mixing equipment that you choose! Cart-Away is proud to support you with an experienced team of professional concrete operators along with our line of quality equipment.
|Company Information | Contact Us | Call a Cart-Away Expert. 1-888-648-5464|
Cart-Away Concrete Systems, Inc., 1405 NE Alpha Drive, McMinnville, Oregon
97128, Phone 1-503-434-4444, FAX 1-503-434-5888
All Specifications subject to change without notice.