Added to benefiting the environment, used tire recycling can be a profitable business. Millions of used tires provide a continuous source of supply of recycled tires that are used in three markets: tire-derived fuels, civil engineering applications and ground rubber applications or rubberized asphalt.
Prior implementing and financing a tyre recycling business, conduct a thorough market analysis to identify possible customers in your area and to find reliable sources of supply.
Havelet Finance Limited is a Channel Island finance and loan company is capable of funding a large tyre recycling business at affordable rate of 2% per Annum.
Finding Sources of Used Tires
- Tire retailers
- Taxi companies
- Car rental firms
- Bus operators
- Trucking companies
- Companies with large car fleets
Methods of Acquiring a Used Tyres
- Sending vans to a supplier’s location for pickup.
- Using drop-and-hook, a method that refers to leaving a bulk trailer at the supplier’s location to fill. The trailer is picked up by the recycler when it is full.
- Encouraging do-it-yourselfers to drop off tires at the processing plant.
As you visit with the possible used tire sources, form estimates about the potential volume of tires that each source might be able to supply.
Finding Customers for Used Tire Products
The following is a sample of possible customers for tire-derived fuel products:
- Electric utilities
- Pulp and paper mills
- Cement plants
- Institutional and industrial boilers
- Dedicated tire-to-energy plants
Ground or crumb rubber is used in the manufacture of a variety of products. Look for manufacturers of the following items:
- Automotive parts and tires
- Agrimats and equestrian footing
- Landscaping, walkways and trails
- Extruded and molded products
- Rubber modified asphalt
- Athletic surface and fields
- Playground mats
Recycled tires have found applications in different types of civil engineering projects:
- Road construction
- Septic tanks
- Building foundations
- Landfill construction
- Light-rail base for commuter trains
Methods of Tire Recycling
Recycling tires is a business that must be studied and learned to operate successfully. The owner must understand the advantages and disadvantages of the process. Depending on the mix of potential buyers, an operator should know which applications require a specific particle size.
An owner needs to know how to operate all of his equipment so that he can teach his employees to work productively and not be injured.
Prepare a Business Plan
After making a thorough analysis of potential sources of supply and making a list of possible customers, prepare a business plan to determine how to build a profitable business recycling tires. Starting up a tire recycling business requires a considerable investment of funds in equipment, site preparation, trucks and wages. The path to profitability must be carefully thought out with financial projections and the determination of the break-even sales level. The business plan will be needed when talking to banks and investors for loans and financing.
Site Location Analysis
The location of the plant must comply with local zoning regulations. Tire recycling is a noisy, dusty business, so there are restrictions on where a municipality will allow these plants to be located.
The site must be large enough to accommodate storage of used tires and recycled products. It needs a building to house the equipment and an office and must have easy access for trucks coming and going.
Licenses and Permits
Financing a tyre pyrolysis recycling business needs approval from local, state and federal agencies, especially the environmental departments. Some of these permits can be expensive, and they should be included in your business plan expenses.
Adequate Insurance Coverage
A tyre recycling plant must have adequate insurance coverage. It has safety risks and the potential for environmental mishaps. It needs protection from product liability lawsuits.
Recycling tyre can be a profitable business, but it must be carefully planned and supported with sufficient financial capital to succeed. With millions of cars and trucks on the roads, there will be a continuous source of supply. The challenge is finding the most efficient collection methods and producing the products that are in demand by other manufacturers in the area.
Sources of Funding for Tyre Recycling Business
Access to capital is a significant barrier to the growth of new and expanding a Tyre recycling enterprises. However, recycling companies are not unique in having difficulty finding the funds to expand. Indeed, improving capital formation was the top priority of small and entrepreneurial business participants in the recent series of White House Conference on Small Business meetings.
In the recycling industry, new companies may have special challenges in attracting capital. New technologies or processes, fluctuating commodity prices, uncertain materials supply, and fickle customers can combine to make these enterprises appear too risky to potential investors. Financial institutions like to compare potential financing deals with existing ventures. However, in many developing recycling sectors, such “comparables” are often hard to come by. Recycling entrepreneurs must be persistent and innovative in their search for the funding to make their business plans a reality
The Waste and Resources Action programme has launched a new funding sources and program aimed at increasing the UK’s used tyre recycling infrastructure.
Havelet Finance Limited, a Channel Island Finance and loan company provide financial support towards the cost of plants, equipment and infrastructure for projects in the EU, ASIA, AFRICA, MIDDLES EAST, AUSTRALIA and AMERICA in order to increase recycling of used tyres into sustainable markets.
Financial institutions and investors belong to a variety of associations. These associations can provide referrals to active members in a geographic area and information on the general investment criteria of their members. For example, the National Association of Small Business Investment Companies, Alexandria, Va., represents financial institutions which invest equity capital and long term debt in small, independent businesses.
RECYCLING VENTURE FORUMS
A recent study concluded that investment forums focused on recycling ventures could help strengthen the capital markets for those companies. The Recycling Venture Forum Study, available through The Northeast Recycling Council, Brattleboro, Vt., and the National Recycling Coalition, Washington, noted that although there are many individual investors, investment firms, finance companies, intermediaries, or other capital sources that are interested in financing strong recycling ventures, reaching these investors is a costly and difficult proposition.
Whether identifying potential equity investors through networks, associations, forums or other methods, the entrepreneur needs to structure the investment offering with assistance from appropriate counsel. One option is to sell off company securities in a private placement complying with Securities and Exchange Commission’s small business exemption regulations to reduce expense and reporting requirements.
Public loan and loan guarantee programs offer a good complement private debt and equity financing sources. Federal, state, and local governments offer financing assistance to help promote small business, community development, rural employment, minority businesses and other goals.
The survey of North Carolina recycling businesses found that four out of five were independent small businesses, not subsidiaries of larger companies.
Their sales revenues averaged about $1 million per year and they employed about 12 workers per company. Recycling enterprises across the country that match this description are ideal candidates for SBA small business debt financing programs.
The SBA 7A Guaranteed Loan Program, for examples, guarantees loans through private lenders to businesses for up to $500,000 for a variety of uses.
Our Service includes;
• Long-term loans for up to 20 years.
• Organization of project finance (PF) schemes.
• Operations with letters of credit or bank guarantees.
• Financial modeling and consulting.
• Investment engineering.
Contact us today for all Trye recycling business financing.