Two Seasons Garlic Business Plan — Market Analysis
Market size, demand drivers, pricing and the ceiling this plan explicitly acknowledges on national consumption.
Market Analysis
Jump to section
- Overview & contents
- 1. Executive Summary
- 2. Investment Thesis
- 3. Company and Business Overview
- 4. Problem, Customer Need and Value Proposition
- 5. Products and Services
- 6. Industry Analysis
- 7. Market Analysis
- 8. Customer Analysis
- 9. Market and Competitive Landscape
- 10. Business Model
- 11. Go-to-Market Strategy
- 12. Operating Model
- 13. Management and Organisation
- 14. Strategic Plan
- 15. SWOT Analysis and Strategic Implications
- 16. Risk Analysis
- 17. ESG and Sustainability
- 18. Implementation Roadmap
- 19. Financial Model and Revenue Build
- 20. Projected Income Statement
- 21. Projected Balance Sheet
- 22. Projected Cash Flow
- 23. Capital Expenditure and Working Capital
- 24. Funding Requirement and Structure
- 25. Break-Even Analysis
- 26. Investment Case and Returns
- 27. Debt Serviceability
- 28. Sensitivity and Scenario Analysis
- 29. Key Performance Indicators and Management Dashboard
- 30. Conclusion
- A. Appendix A: Assumption Register
- B. Appendix B: Conditions Precedent to the Seed Subscription
- C. Appendix C: Glossary
- 7.1 TAM, SAM and SOM
- 7.2 Customer segments and demand drivers
- 7.3 Pricing dynamics and seasonality
- 7.4 Customer acquisition dynamics and market gaps
The serviceable obtainable market of 910 tonnes in FY2031 is 22% of a serviceable market of ~4,100 tonnes, large enough to build a R53m business, small enough to impose a ceiling the plan respects.
7.1 TAM, SAM and SOM
|
Tier |
Definition |
Tonnes |
Value (R m) |
Derivation |
|---|---|---|---|---|
|
TAM |
Fresh garlic consumed in South Africa and reachable SADC markets (Namibia, Botswana, Eswatini, Mozambique, Zambia) |
~9,000 |
~440 |
SA apparent consumption 5,200 t + SADC imports of ~3,800 t at a blended ~R49/kg |
|
SAM |
Channels the company can serve: SA formal retail (~45% of consumption), food service (~30%), SADC export reachable by road (~600 t) |
~4,100 |
~235 |
2,340 t retail + 1,560 t food service + 600 t export at channel prices less freight |
|
SOM |
FY2031 saleable crop |
910 |
52.8 |
Bottom-up from 92 ha × 11.8 t/ha less seed and culls at modelled channel mix and prices |
Table 13. TAM, SAM and SOM (FY2031 basis).
The top-down check: 910 tonnes is 17.5% of SA apparent consumption in FY2027 terms and 15.0% after 3% annual growth; against the import pool of ~3,000 tonnes it represents displacement of about 30% of imports. The bottom-up build from hectares, yield, seed retention and cull rate is the basis of the financial model. The two approaches reconcile because the bottom-up figure was deliberately capped to a share the market can absorb without the company moving the price against itself.
7.2 Customer segments and demand drivers
|
Segment |
Share of SA consumption |
What it buys |
Demand driver |
Company priority |
|---|---|---|---|---|
|
National retail |
~45% |
Graded pre-pack and loose bulbs on programme |
Local-sourcing policies; provenance labelling; shelf-life economics |
Primary — carries the price |
|
Food service and restaurants |
~30% |
Peeled cloves; whole bulbs |
Casual-dining growth; labour saving in kitchens; shelf life |
Primary — carries the margin |
|
Food manufacturing |
~10% |
Bulk bulbs and culls for paste and seasoning |
Lowest cost; import-parity pricing |
Tertiary — served with culls |
|
Informal and municipal markets |
~15% |
Mixed calibre, bagged |
Price |
Clearing channel only |
|
SADC export |
Outside SA |
Cured bulbs, 10 kg mesh |
Proximity; seasonal timing; regional shortfalls |
Secondary — diversification |
Table 14. Customer segments.
7.3 Pricing dynamics and seasonality
Domestic garlic prices follow a seasonal pattern: they are weakest at the September–November Limpopo harvest when local volume peaks, firm through the summer and peak in April–July when stored local product is exhausted and the market is supplied only by imports. The two-block structure places the Karoo harvest in December–January, allowing cured product to be marketed into the firmer autumn window. Realised prices in the model are season-blended and include an explicit R5/kg discount for the heaviest-supply months.
Pricing is anchored to the landed cost of Chinese garlic inclusive of the R19.25/kg duty, currently R48–R52/kg at the port, plus the local premium of 5–10% that retailers pay for provenance and shelf life. Spanish and Argentine garlic lands at R55–R65/kg and is therefore not a price constraint. The plan’s retail price of R63/kg at FY2031 is consistent with these benchmarks after 2–3% annual price inflation.
7.4 Customer acquisition dynamics and market gaps
Acquisition in retail is a two-season process: a trial season on a short window, then a programme listing once the packhouse is certified and two-block supply is demonstrated. Food service is acquired through two or three national distributors rather than one kitchen at a time. The market gaps the plan targets are the absence of any domestic supplier with an eight-month window, the absence of a locally peeled line at commercial scale, and the thinness of regional supply into Botswana and Namibia in the December–March period.