Let’s Talk Granite - Pre-fabricated Granite Import Guide

It’s one of the hardest substances on the planet, its classy and its profitable! Walk with me examining what has been one of the most profitable importing ventures to date. You have to have networked into the right business circles, but pre-fabricated granite has rock hard margins for selling to or consulting for real estate builders/developers/tycoons or granite shops.

Granite in a Nutshell
This is an immensely labor intensive business, which makes a great recipe for a Chinese manufacturing and import venture. The material doesn’t cost that much so the majority of the cost is from the middleman and fabricator.

This is generally how granite countertops arrive in your home:

There is a solution that places you as the main link between the quarry and the builder. Let’s buy from the source, do all the fabricating in China, import it and sell it direct to the builder. Sounds complicated, it’s not, but you have to be meticulous with your work.

Overview
This business model will only work for selling to a client that has a minimum of twenty homes that will need granite. Track home builders, condo developers or high end apartments are the main types of companies to target. Granite fabrication shops are also good customers, but we will discuss that sales model later. This also works for restaurants or commercial businesses depending on their size. You will need to find clients that have a large enough order to fill up an entire 20ft container worth of granite countertops. If you do not fully fill the container then you are losing profit margin. When you have imported the granite, you will open your container and find crates containing pre-made granite countertops. What is required for installation is to unpack the crates, set the countertops onto the cabinets and glue the undermount sinks. That’s it!

This is how our business model will work:

• 1. Find a client that you can either sell granite pre-frabricated and ready to “drop in” or work out a consulting fee to do it for them (if they do not want to pay you the money direct). The key here is to take measurements just as any other granite shop would either from architectural plans or from cabinetry already installed. The order needs to be placed a minimum of 45 days ahead as this is how long it will take to produce and ship the granite to the US.
• 2. Take those measurements and enter them into Microsoft Visio or a CAD application. This is often referred to in the granite industry as templating. Diagrams should include exact measurements for the granite that will be made including: locations for sink holes, indications of which sides are polished and overall length/width. If this is a kitchen, for instance, break the countertops into sections. As an example, here is a a diagram from a recent order for a developer that performed an apartment to condominium conversion and needed 114 condos worth of granite :

• 3. Enter all the dimensions from each diagram into a purchase order list like this (this is just a section):

• 4. Email order and diagrams to your granite or stone fabricator/manufacturer in China. I would recommend that you have the manufacturer arrange delivery and logistics. I have personally purchased a number of containers of granite from China Newstar (www.stone-export.com) and have nothing but great compliments about their craftsmanship/work.

• 5. Arrange payment (for deposit) via international wire transfer or letter of credit.
• 6. Accept delivery either at a commercial location with a loading dock or have the product transferred to a flat bed tractor trailer. This can be done in conjunction with a customs broker and domestic freight provider. Encore Forwarding (Jacksonville, FL) can handle this type of request, they have offices in most major US port cities. In any event, you will need a fork-lift to unload the crates.
• 7. Partner with a capable contractor for installation. They will be getting 20+ houses of install so you can negotiate for a very reasonable price. Often times the builder has staff that can handle install on their own.

Areas of Cost and Additional Profit Opportunity
Let’s first examine the various areas where margin can be increased.

Chinese Local or Import Granite : The way I see it, stone is stone. You could get a nice Italian suit or the same suit without the label, your choice. Imported products are typically more expensive than domestic. When it comes to granite, the savings can be enormous. You obviously want to request samples from the manufacturer to compare, but I would recommend showing your customer the Chinese granite samples with a “this is in the style of Uba Tuba” disclaimer. If the customer wants the real deal, sell it to him. The real cost savings to the customer will be better in Chinese granite. Compare the two colors below.

Granite Fabrication and Installation : It’s important to note that the granite fabrication and installation phase is the highest factor of cost. By the time we are done, it will be the least expensive factor. The granite will arrive and be ready to drop in place.

Accessory Items : If what you have read hasn’t sold you, here is the kicker. The same company you will select to manufacturer the granite can offer you the stainless steel kitchen sinks and porcelain vanity sinks at well below wholesale. They do this so that they can cut the sink holes in the granite to exact specifications. Stainless steel sinks typically cost $50USD and the 18″ vanity sinks run $8USD.

Costs, profit margins and what to expect

Here is the overview of specifications and related costs per unit/home. This is important when discussing prices with the builder/developer. If after talking with the your client, they are interested in getting an ACTUAL quote, then ask for architectural plans to prepare a quote from. The below spreadsheet shows actual costs, is setup for a consulting-style contract and includes a $250 markup per home. At forty homes, using this schedule, your total profit from one container of granite is $10,000. Profit margins are much higher if you “sell” the granite to the builder just as a would a local granite fabrication shop. This pricing is also based upon the import of Uba Tuba and additional profit can be obtained by using Chinese domestic granite colors. This information is purely for instructional purposes and should not be taken at face value.

The comparison cost of purchasing US domestically fabricated granite would well exceed $2,364.85. This translates into a 50% savings to the builder and enough to land his business. It is important to note that this is not an installed price. Negotiating with a contractor for a reasonable installation price is paramount in keeping the margins up.

Here are some of the typical costs for importing a 20′ container of granite including sinks. These figures are from actual costs (2 years ago).

Here is an example of a multiple container quote for a 90+ unit luxury Florida condominium development. You can imagine what the granite would cost here in the states if our quote was $110k!

dylan@sourcejuice.com

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