Midrand Print Company Business Plan — Risk Analysis

Digital substitution, overcapacity, input cost and credit risk, with controls and trigger points for each.

Section 17 of 28

Risk Analysis

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16.1 Risk register

	Risk	Prob.	Impact	Rating	Mitigation	Owner
R1	Volume shortfall against the account acquisition plan	High	High	Critical	Paid pilot model to shorten and de-risk conversion; second press deferrable to FY2031 on single-press capacity; expansion capex gated on utilisation triggers rather than calendar	MD
R6	Ramp-phase debt-service gap before FY2030	High	High	Critical	Twelve-month capital moratorium on AF1; 18-month moratorium on the term loan; covenant testing deferred to the FY2030 measurement date; R7.5m revolver as the liquidity buffer	FM
R2	Working-capital absorption and debtor stretch	High	Medium	High	Credit limits set before first order; consolidated monthly programme billing; credit insurance on the ten largest exposures from FY2029; debtor days a board KPI and a bonus metric	FM
R3	Loss of an anchor account	Medium	High	High	No single account above 12% of revenue by policy; annual contracts with 90-day notice; embedded template libraries raise switching cost	Head of Programmes
R4	Substrate cost inflation and rand volatility	High	Medium	High	Dual-sourced substrate by category; quarterly rate-card review; currency adjustment clause above a 7% movement threshold	Ops Director
R11	Structural decline in print demand	High	Medium	High	Portfolio weighted to branch, regulatory and in-store collateral with no digital substitute; service revenue growing as a share of the mix	MD
R5	Press downtime and unplanned maintenance	Medium	High	High	OEM service contract with response-time commitment; capacity headroom allows rescheduling; trade-finisher relationships provide overflow	Ops Director
R7	Power supply interruption	High	Low	Medium	Backup capable of carrying a controlled shutdown; production scheduled around published load curtailment where possible; cost provided in overheads	Ops Director
R8	Scarcity of skilled press operators	Medium	Medium	Medium	Structured apprenticeship with the OEM; retention premium budgeted into production labour; cross-training across lines	Ops Director
R9	Technology obsolescence of the installed base	Low	High	Medium	Seven-year asset lives against a six-to-eight year practical technology cycle; maintenance and upgrade capex provided from FY2029	Ops Director
R10	Regulatory, environmental and B-BBEE compliance	Low	Medium	Low	ISO 9001 and FSC certification in months 5–11; B-BBEE verification annually; waste and solvent handling to permit conditions	FM
R12	Key-person dependency	Medium	Medium	Medium	Documented programme and scheduling procedures; deputy identified for each critical role by FY2029; key-person cover on the two founder executives	Board

Table 28: Risk register, ordered by overall rating

16.2 Risk heat map

Figure 1. Two risks sit in the critical quadrant — and they are the same commercial exposure seen twice

R1 and R6 are not independent. The debt-service gap exists because the fixed cost base and the financing structure are sized for the volume plan; if volume arrives, the gap closes on schedule. Treating them as two risks with two mitigations overstates the diversification in the register. The honest formulation is that this is a single-factor risk case: the company is exposed to whether it can acquire and hold programme accounts at the modelled rate, and almost everything else in the register is second-order beside it.