AgriNova Business Plan › Section 6 › Business Model & Revenue Streams

AgriNova operates a diversified, multi-stream model that converts a
single raw material — maize — into a portfolio of food, feed and
engineering revenues. The model is designed so that no single stream
dominates risk, and so that the higher-margin equipment and services
activities offset the structurally thin margins of commodity
milling.

6.1 Revenue Mix

In the steady state (Year 5), milled maize products and samp
contribute the largest revenue share, followed by animal feed, with
equipment and services collectively contributing roughly one-sixth of
revenue. The chart below shows the Year-5 revenue composition across all
streams.

Figure 6.1

6.2 Margin Architecture

The Company deliberately layers margin pools of different character.
Commodity milling delivers high-volume, low-margin throughput that
covers fixed costs and anchors customer relationships. Feed adds
counter-cyclical volume. The equipment and services division contributes
a smaller revenue share but a disproportionate share of gross profit,
lifting the blended margin. Management is explicit that this blending is
the source of the consolidated 32–33% gross margin and that the milling
and equipment economics should be assessed as separate profit pools.

6.3 Pricing Approach

Maize-product pricing tracks the underlying maize price plus a
milling spread, with the spread protected by procurement discipline,
yield optimisation and product-mix management (samp and grits earn more
than basic meal). Equipment is priced on a cost-plus engineering basis,
while services and spares are priced for margin and customer retention.
The model assumes a 5% annual inflation pass-through across prices,
broadly consistent with the prevailing inflation outlook.

6.4 Customer Segments & Channels

• Formal retail and wholesale — packaged maize
  meal and samp through chains, wholesalers and independent
  traders.
• Institutional buyers — government feeding
  schemes, hospitals and bulk caterers seeking reliable staple
  supply.
• Feed customers — poultry, pork and cattle
  operations buying compound feed and bran.
• Equipment customers — emerging and established
  millers, including community-mill franchisees, buying machinery and
  services.

Confidential — this business plan is provided to prospective investors and lenders for evaluation purposes only and may not be reproduced or distributed without the written consent of AgriNova Milling Technologies (Pty) Ltd.