Monday, July 24, 2006

Minimum Production Volumes

Something I wrote quite a while ago...

Actually I think a small plant can be profitable closer to 100K
gallons/year. I was recently contacted by Footprint Recycling in Arcata
who are producing less than that and have been in business for 3 years.

There are several things that change when you run a really small
business (small business are $10,000,000 - $50,000,000 according to
government classifications).

1) A really small business can be in the oil pickup business which
reduces some artificial and some real costs in having to buy yellow
grease on the open market.
2) A really small business can sell to small off road buyers who don't
get great discounts from really big fuel suppliers but still are great
customers for really small businesses.
3) A really small business doesn't have to go into the whole NBB thing.
They can just sell a diesel fuel additive which informed customers seem
to be pretty happy with.

Kenneth Kron
Bay Area Biofuel

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