Thrive Agric Founders Issue Statement to Customers Over Delay in Payouts

Proshare

Thursday, October 08, 2020   /08:14 AM / Press Release By Thrive Agric/ Header Image Credit: Thrive Agric


 Proshare Nigeria Pvt. Ltd.


By now, you may be aware that payouts for some farm subscriptions are delayed.  This is an unfortunate outcome of the COVID-19 pandemic and its consequent restrictions on physical access to farms and farming markets.  Like many other businesses, we were not fully prepared for the impact, and despite the intent upon which this company has been run for the last 3 years, our subscribers now bear the brunt of these challenges with us.  

 

We are issuing this statement to convey three things: 

 

First, to once again express our deepest apologies that subscriber payouts are delayed.  Second, to share our plans to resolve this issue.  And third, to reassure you that Thrive Agric remains a viable business that Nigeria needs.

 

Catching up on the payouts

 

Thrive Agric's primary revenue source is based on a successful harvest (inclusive of crops and poultry).  Therefore, any revenue coming into the business is synchronized with the success of the operation and timing of sales.  When a planting season or harvest is lost, like we did this year, Thrive Agric can only hope to earn such lost revenues from subsequent harvests.  In our case, we have previously communicated to subscribers that we would meet our obligations based on overdue payments from off-takers.  Some of those payments have come in, but not nearly enough to meet our obligations to subscribers.  We hoped they would, but they did not.  

 

In the last week, we have communicated timelines for repayment to our subscribers of up to 24 months depending on the specifics of their subscription. We expect to payout before the committed due date, but in the past, we have been aggressive in our expectations and not met them.  We do not want to continue to disappoint our customers so we have given a timeline that we can more confidently keep.  We are taking steps to beat this timeline, but experience has taught us to be more realistic.  We fully understand our customers' frustration as the business is in the same position of linking obligations to expected payouts, only to have the schedule change.   

 

We remain committed to our mission to enable agriculture, combat food scarcity, and build local wealth in Nigeria and beyond.  We still believe that dream to remain valid, despite the current challenge.  We also remain committed to our subscribers and will pay ALL outstanding subscriptions as quickly as we can.  

 

The Pandemic and It's Effects on Thrive Agric

The COVID-19 pandemic and the subsequent movement restrictions in Nigeria and neighboring countries, greatly hampered business operations that generate the returns on your investment:

  • Border restrictions restricted the availability of farming inputs (feed, fertilizers, and agrichemicals)
  • The price of farming inputs increased dramatically and fluctuated frequently, reducing the number of farmers we could support within our original budget
  • Due to isolation and the restricted movement, we could not physically reach the farmers to give them much needed farm inputs, reducing farming activities
  • Major offtakers stopped production, in order to design safety measures to protect their staff and the food they make for the market

Our business has been hit very hard.  All of these factors have had a ripple effect through the organization and reduced operations well below normal levels.  In summary, the combination of more expensive inputs, restricted distribution and constrained markets reduced business earnings. Like many others around the world, nothing prepared us for this unpredictable challenge.  

Now that lockdown restrictions have eased, business operations are picking up,  we look to a bountiful harvest at the end of the year to get back on our expected trajectory.  

Operations are indeed returning to normal:

  • Rainfall has been optimal which is indicative of a good yield
  • Eased movement restrictions now allow distribution of inputs to farmers and for harvest operations to commence
  • We have begun to redesign our operations such that we put better risk management in place to avoid a recurrence of this scenario
  • We have also put repayment plans with our offtakers that owe the business and expect those funds to start coming back in
  • The market for the 2020 harvest has begun to open up as sales calls have commenced

As operations pick up, so will payments. 

Further Communication with Customers.

Also, over the past week, we communicated our current business challenges, our inability to process payouts to our subscribers, timelines for these repayments as well as the processes we are putting in place to steer the business to full recovery and fulfill our commitments to our subscribers in full.

 

We have also put together answers to frequently asked questions about the status of current farm subscriptions on Thrive Agric available here. Also, we have kept all our communication lines open for more questions, and as we get them from our subscribers, we will constantly update this page with more answers as we go.

 

We took it a step further to invite our customers via their subscribed emails to register for zoom calls to address these concerns and also to cover any questions that we may not have addressed.  These are dated Friday, October 9, 2020, 4pm and Saturday, October 10, 2020, 11 am. 

 

Disclaimer

Please note that the statement above is that of the founders of Thrive Agric and not the position of Proshare. The information is considered to be useful and informative for subscribers to Proshare.


 Proshare Nigeria Pvt. Ltd.


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