Commercial Plan

Jump to section

• Overview & contents
• i. Important Notice and Basis of Preparation
• 1. Executive Summary
• 2. The Business
• 3. Market Analysis
• 4. The Energy Strategy
• 5. Facility and Location
• 6. SWOT and Competitive Position
• 7. Commercial Plan
• 8. Operations
• 9. Financial Plan
• 10. Break-Even and Debt Service
• 11. Investment Analysis
• 12. Risk Analysis
• 13. Implementation Roadmap
• 14. Key Performance Indicators
• 15. Key Assumptions
• 16. Conclusion and Recommendation
• A. Appendix A: Consolidated Financial Summary
• B. Appendix B: Capital and Depreciation Schedules
• C. Appendix C: Funding and Debt Schedules
• D. Appendix D: Energy Model
• E. Appendix E: Risk Register
• F. Appendix F: Glossary

7.1 The occupancy ramp is the whole plan

The store must reach roughly 56 per cent occupancy to cover its costs and debt service, and the plan projects 46 per cent in Year 1. That gap is funded from the working capital reserve, and it is the central commercial risk in this document. Everything in this section exists to close it faster.

7.2 Anchor tenancy before commissioning

The single most important commercial action happens before the plant is switched on. The plan requires 1 200 pallet positions, roughly 27 per cent of capacity, contracted on multi-year terms as a condition of drawing capital. Anchor tenants are offered a discount of 10 to 15 per cent against the rate card in exchange for term, minimum volume commitments and a take-or-pay floor.

7.3 Rate card

Tariffs escalate at 6.2 per cent a year against assumed inflation near 3.5 per cent and assumed energy escalation of 8.8 per cent. This is a real price increase and customers will resist it. The plan’s defence is contractual: an energy pass-through clause indexed to the published Eskom tariff, capped so the customer is protected from the worst case and the operator is protected from carrying the full increase. A cold store that cannot pass energy through will see its margin eroded by roughly two points every year.

7.4 Winning customers

• Direct sales into the manufacturing corridor. A small commercial team calling on food manufacturers, importers and distributors within a 40 km radius. This is a slow, relationship-driven sale with a six to nine month cycle, which is why the ramp is modelled over three years rather than one.
• Blast freezing as the entry service. Few independents offer it. A manufacturer who brings product for blast freezing frequently leaves it in storage, which converts a transactional service into a contract.
• Certification as a qualifying condition. FSSC 22000 or BRCGS certification is not a differentiator; it is the price of entry for retail-bound and export product. Targeted by month 12 and budgeted accordingly.
• Seasonal overflow as a wedge. Taking a national operator’s overflow at peak is low-margin work that fills otherwise empty space and creates the relationship that later becomes contract volume.