Eoa

Encounter Olives Australia Pty Ltd

• Supply of EVOO in Australia will exceed demand well before 2010.

• To find an outlet for our oil we will have to export.

• The cost of finding and developing export markets is beyond most of us.

• The solution is to work together


• Export markets often need volumes which are larger than individual growers can supply.

• Cost of bottles etc are lower in larger volumes.

• Internal competition is counter productive. It will be hard enough to compete with oil from other countries.



• Small to medium growers cannot survive on $5.40 per litre being offered.

• Currently small to medium growers are able to find local markets through friends, local business and markets.

• There will be increasing competition for these sales.



• Encounter Olives has been set up by growers to develop the idea of working together.

• While the company needs to make money in order to fund operations and to pay dividends to shareholders, the majority of money made will flow through to growers in the form of higher prices.

• The company needs initial funds to develop the export markets


• It is estimated that the company will require around $200,000 to fund the first two years of operation.

• It is intended to apply for export development grants to assist with funding.

• Other forms of raising money may include sponsorships from suppliers and bank loans based on received orders.


• The first country we will target is the US.

• The Free Trade agreement eliminates duties.

• There is almost no language barrier.

• We have similar cultures.• We have similar eating habits.• The distribution chains are similar.• The market for olive oil is very large and relatively

immature.


• To obtain higher prices for growers the selling price asked will have to be higher.

• By value adding it is possible to obtain higher prices.

• By selecting markets which are more exclusive it is possible to obtain higher prices.

• By maintaining very high quality standards it is possible to obtain higher prices.


• The company will target outlets such as Wholefoods which provide high quality products to discerning shoppers.

• The company will seek out distributors who are experienced in supplying the better quality outlets.

• The company will seek advice from experienced exporters.


• To ensure success, EOA needs a guaranteed supply.

• To ensure success, EOA needs to be able to source large volumes of high quality EVOO.

• To ensure success, EOA needs raise enough capital to fund the development.

• To ensure success, EOA needs quickly find a customer.


• We have given ourselves 12 months to find that first customer.

• EOA will aim for as high a price as possible for growers but the end price will depend on what our customer is willing to pay.

• As an indication, EOA would target A$6.50 as a minimum return to growers.


• Directors of EOA will include several representatives from the founding members.

• Some positions on the board will be open to Shareholders.

• In the event that there are more applicants for shares than there are positions available the distribution will be via a ballot.


• There are a maximum of 19 individual shareholder positions available determined by Companies Law.

• The 20th Share will be held by a Unit Trust.

• It may be possible to add further shareholder positions in year 2.

• EOA is a company and not a Co-Operative.


• Suppliers will be asked to sign supply agreements.

• Shareholders will be offered a place on the preferred suppliers list.

• All suppliers will be required to meet minimum quality standards and to be able to demonstrate this.

• Payment for oil will not be made until EOA has been paid by the customer so both the supplier and EOA will share some risk

Business

Eoa