Tarlton Beetroot Business Plan — Risk Analysis and Register
Water, price, agronomic and execution risk scored by likelihood and impact, with mitigations and trigger points.
Section 19 of 37
Risk Analysis and Register
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- i. Important Notice and Basis of Preparation
- 1. Executive Summary
- 2. Investment Thesis
- 3. Company, Structure and Stage of Development
- 4. Customer Problem, Value Proposition and Monetisation
- 5. Products, Portfolio and Unit Economics
- 6. Industry Analysis
- 7. Market Analysis and Sizing
- 8. Customer and Channel Analysis
- 9. Competitive Landscape
- 10. Business Model
- 11. Go-to-Market Strategy
- 12. Operating Model: Agronomy and Production
- 13. Operating Model: Post-Harvest, Packhouse and Logistics
- 14. Water, Energy and Land: The Three Binding Constraints
- 15. Management and Organisation
- 16. Strategic Plan
- 17. SWOT Analysis
- 18. Risk Analysis and Register
- 19. ESG and Development Impact
- 20. Implementation Roadmap
- 21. Financial Assumptions
- 22. Projected Income Statement
- 23. Projected Balance Sheet
- 24. Projected Cash Flow
- 25. Capital Expenditure and Working Capital
- 26. Funding Requirement and Structure
- 27. Break-even Analysis
- 28. Debt Serviceability
- 29. Investment Returns and Valuation
- 30. Sensitivity and Scenario Analysis
- 31. Phase 3: Processing Optionality
- 32. Key Performance Indicators and Management Dashboard
- 33. Conclusion and Investment Recommendation
- A. Appendix A: Monthly Projections, Year 1
- B. Appendix B: Detailed Assumptions Register
- C. Appendix C: Glossary
Fourteen risks assessed. Three are severe, unhedgeable and central to the investment decision.
Table 29 Risk register
|
ID |
Risk |
Prob. |
Impact |
Rating |
Mitigation and owner |
|---|---|---|---|---|---|
|
R1 |
Beetroot price falls materially below assumption |
High |
High |
Severe |
Migrate volume to contracted retail; hold informal channel as a floor; contract Year 4 and 5 volume on seasonal fixed price. No hedge exists. Owner: Commercial Manager. |
|
R2 |
Funding shortfall — committed capital does not cover the base case |
High |
High |
Severe |
R7.5 million working capital facility as a condition precedent to Series A; weekly cash monitoring from month 30; ability to defer the second in-field irrigation tranche. Owner: Managing Director. |
|
R3 |
Water entitlement not verified or reduced on validation |
Medium |
High |
Severe |
Independent hydrological and legal verification before transfer; entitlement is a condition precedent to drawdown and bond. Owner: Managing Director. |
|
R4 |
Retail agreements not secured or secured late |
Medium |
High |
High |
Begin engagement in Year 1; fund paid trials; lead with certification; maintain municipal market capacity as fallback at a R3.50/kg realisation penalty. Owner: Commercial Manager. |
|
R5 |
Hail or severe weather event |
Medium |
High |
High |
Crop insurance at R3,900 per hectare-cycle; staggered planting spreads exposure across the season; rotation block diversifies. Owner: Production Manager. |
|
R6 |
Yield underperformance against 51–54 t/ha assumption |
Medium |
High |
High |
Independent agronomic consultant; boron programme; cultivar trials on the Phase 1 block; break-even yield is 30.6 t/ha, giving 43 per cent headroom. Owner: Production Manager. |
|
R7 |
Customer concentration — loss of one of two retail accounts |
Medium |
High |
High |
Actively pursue a third account from Year 4; maintain market agent relationship; staged volume commitments. Owner: Commercial Manager. |
|
R8 |
Key-person dependency before month 27 |
Medium |
High |
High |
Key-person insurance; retained agronomic consultant; early appointment of Commercial Manager at month 13. Owner: Board. |
|
R9 |
Land tenure and expropriation policy |
Low |
High |
High |
Clean title, productive use, compliant employment, community engagement. No insurance instrument exists. Owner: Board. |
|
R10 |
Interest rate increase on prime-linked debt |
Medium |
Medium |
Moderate |
Modelled at prime 10.50 per cent; a 200 basis point rise reduces Year 5 DSCR from 2.54 to approximately 2.21, which remains within covenant. Owner: Financial Manager. |
|
R11 |
Electricity tariff escalation above the 5.8 per cent assumption |
High |
Low |
Moderate |
100 kWp solar from month 31; off-peak pumping scheduling; drip rather than overhead irrigation. Owner: Production Manager. |
|
R12 |
Labour cost escalation and labour relations |
Medium |
Medium |
Moderate |
Modelled at 5.8 per cent, above revenue escalation; compliant conditions; selective mechanisation of land preparation only. Owner: Production Manager. |
|
R13 |
Food safety incident or certification loss |
Low |
High |
Moderate |
GLOBALG.A.P. systems; potable wash water with chlorination and monitoring; traceability from block to pallet; product liability cover. Owner: Packhouse Manager. |
|
R14 |
VAT refund delay from SARS |
Medium |
Low |
Low |
1.5 month lag already modelled; monthly filing; complete supporting documentation; overdraft facility bridges timing. Owner: Financial Manager. |
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