Business Idea: Recycling Car Tires

Today we have a special guest, entrepreneur and owner of a small plant for recycling car tires, Igor Prokhor, who is ready to share an interesting and unique business idea. It's rare to come across a businessman who can divulge all the nuances of his business in detail: who wants to lay all their cards on the table for competitors to see? But when it comes to selling a business, the situation changes.

So Igor, before we delve into the business itself, why do you want to sell your business? Is it not profitable?

Hello. No, to say that this business is not profitable would be a lie. Moreover, in today's complex conditions, the production of coal and liquid fuel is very relevant for any region in Ukraine. The reason for selling is a transition to another sector of business. You know, I enjoy achieving goals. Once the goal is achieved and all that's left is a monotonous process, I lose interest. In short, I crave something new.

Igor, tell us about your plant.

The essence of the business is as follows: a plant for processing used car tires. We have signed over 100 contracts with free tire suppliers (as the law requires them to dispose of tires). After processing, we have: liquid furnace fuel (bought by farmers for grain dryers and asphalt plants), technical carbon (suitable for heating, especially relevant in our time when many are moving away from gas), scrap metal (sold for additional profit). The business is ready - start it up and make a profit.

Do you have the necessary licenses?

Yes, all the documentation for tire recycling is in order. We have been issued documents by the relevant government agencies. We are ready to provide everything.

Let's talk numbers.

Alright. We have 2 tanks, each holding 850 kg. In the morning, we load 1.7 tons of old tires. The entire day is dedicated to processing. In the evening, we have 450 liters of furnace fuel (which amounts to 9900 liters per month). The average market price for one liter of this fuel is currently 6 hryvnias. Therefore, just from one furnace fuel, you earn 2700 hryvnias per day (59400 hryvnias per month).

Another product of the processing is carbon (high-calorie coal). In one cycle, we get 700 kg of carbon (slightly less than 16 tons per month). This coal can be sold for 40-60 kopecks per kg (280 hryvnias per day or 6160 hryvnias per month).
In addition, after tire processing, there is wire left, which we sell as scrap metal (about 300 kg per day). Today, black metal is being purchased at 1.6 hryvnias per kg. Thus, from the wire, we earn 480 hryvnias per day or 10560 hryvnias per month.
In total, the gross income will amount to 76120 hryvnias per month.

But you need to subtract the expenses, right?

Exactly. Let's calculate the expenses: territory rent: 2000 hryvnias per month. Salaries: 8800 hryvnias per month (we have 3 workers). Electricity: 500 hryvnias. Firewood for heating consumes another 2000 hryvnias per month. Other expenses (regular equipment checks, etc.) - an additional 4000 hryvnias per month. Total expenses amount to 17300 hryvnias.

By subtracting the expenses from the gross product, we get a net profit of 58820 hryvnias per month. In practice, the profit is slightly lower, around 40 thousand hryvnias per month (due to downtimes when valves and pipes need cleaning and checks, as well as due to workers: fired, sick, hungover, or absent - they're all humans).

Throughout the night, the tanks and furnace must cool down. As a result, the net annual profit is 480,000 hryvnias.

Where is the plant located, and is there any competition?

The enterprise is located in the urban-type settlement of Kyivertsy, Volyn oblast. Currently, there is no competition in the area because we have an exclusive representation agreement with the equipment supplier.

Have there been any issues with tire deliveries?

So far, we haven't encountered any such problems.

What about product sales?

There are no issues in that regard either. Even now, when the plant is not operational (temporarily shut down by me), farmers call asking to restart the process because they urgently need fuel for heating greenhouses. There are numerous regular customers.

Tell us, how much are you asking for your enterprise?

I am selling the equipment itself for 350,000 hryvnias. If you want to buy the land as well, you will need to pay an additional 300,000 hryvnias. So, a total of 550,000 hryvnias for everything.

If you are interested in this offer, call me:
+38 (050) 512-90-82 Igor.
I will answer all your questions on this topic.

Thank you for the detailed information. We wish you success in selling your business and starting something new.