The concept of a web based business for Natural Stone tiles was started on a premise that there are “basic” materials in each category of Stone (such as Granite, Marble, Limestone, Slate and Travertine) that are commonly available, used and known by all the people in the industry – Home owners, developers, architects, designers, installers and contractors.

In order to achieve these objectives, the company started by selecting 4-5 items in each product group, that we considered as the “Bread & Butter” items in the region (West Coast).

Then a standard was established by working closely with the suppliers selected for each item. The whole concept was shared with them, and standards were set for quality, packing and price.  We are proud to say we have very strong suppliers for each product and the search will be on going in this area.  This will become increasingly important as the number of locations increases, and the challenge to keep consistency of products at each location is increased.

The next step was to find a suitable location with warehouse, which also can handle sufficient product and is accessible to truckers. A good warehousing facility and also trucking companies in the region that can handle trucking at the most competitive rates.

The company will provide a strong infrastructure and support to market the site; that would draw clients to the site. 

Product selection that is appropriate for the local market area. There would be some change in products at each location.  To procure quality materials, at a competitive price. To maintain a high standard of quality, good supply lines and prices.  Inspection and timely shipments.

Site will be supported by a strong marketing team to solicit customers within the region. Make calls to owners, buyers and key personnel who make buying decisions and back up with a Demo CD.  Make sure site comes up on search engines, so people who are looking for the products can be directed to the site.

A robust system for the website. Secure and reliable site for shopping. Each location would have its own warehouse and show products at the specific warehouse.  The site will allow users to look at inventory at other locations, and buy from the preferred locations.

The ultimate goal is to have a network of locations, with a range of basic natural stone tiles products available throughout the United States of America.  This site would become the standard for all Natural Stones in the industry.

1. Total Investment in Inventory to start a new location $1M
2. Monthly Cost of operation
    a. Warehousing   $5K
    b. Other Costs   $5K

Break even at ~$100K

Gross Profit Margin ~15%

Once the location gets to a point where Sales are approx. $200 K per month – the return on the Investment would be about 20~25% and pay back of initial cap investment would be in 4-5 years.

David Hinton
HKG
200 Del Mar, Suite 350
Pasadena,
CA 91105
Tel No 626.585.0666 Ext 203.
Email: dhinton@hkgllp.com