GrainCore Business Plan › Section 9 › Distribution & Logistics

Distribution is where many millers either capture or surrender
margin. GrainCore will build an owned-and-partnered hybrid network
designed for high service levels at low cost-to-serve, with particular
emphasis on the high-volume informal channel that larger competitors
under-serve.

9.1 National Distribution Model

• Central warehousing co-located with the flagship mill for
  efficient throughput.
• Satellite depots positioned in high-density demand nodes to
  shorten last-mile delivery.
• Wholesale distribution to cash-and-carry and independent
  distributors.
• Informal-trade supply chains reaching spaza shops and township
  wholesalers — a deliberate competitive focus.
• Retail partnerships securing listings and shelf space with formal
  supermarket chains.

For context, the reference operator runs fourteen warehouses and
twenty-six-plus depots and satellite depots across an extensive national
network. GrainCore will start lean — one central warehouse and a small
number of satellite depots — and expand the depot network in step with
volume, keeping fixed logistics cost aligned to revenue.

9.2 Logistics Cost Management

Logistics is modelled at approximately 5.5% of revenue. The Company
will mitigate South Africa’s well-documented road, rail, and port
constraints through milling-near-farmers procurement, route
optimisation, backhaul utilisation, and selective use of rail for bulk
inbound grain where reliable. These infrastructure shortfalls are a
recognised sector challenge and are explicitly carried in the risk
register (Section 18).

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 GrainCore Milling & Foods (Pty) Ltd.