BUSINESS RISK AND UNCERTAINTY OF INVESTMENTS IN THE GRAPE PRODUCTION PUBLISHEDBranka Kalanović, Zorica Vasiljević, B. Dimitrijević, Snežana Trmčić
Biological character of grape production influences the existence of numerous risks. Therefore, the research on risk and uncertainty is one of the key problems of the investments into this kind of production. These risks are appearing both during the vineyard establishment and during its exploitation and they are influenced by the state of soil, application of agrotechnical and pomotechnical measures, diseases and pests appearance, the way of yields realization as well as the market risks. Perception of risk is a precondition for business success and the higher profit realization. This is the reason why risk management (identification, analysis and monitoring) should be a part of management policy. One of the methods for the risk and uncertainty assessment in the case of the grape production investments is the sensitivity analysis method. This method could show to investor how much the investment effectiveness indicators are sensitive onto the possible changes of variable starting parameters (prices, production volume, expenditures, level of investments etc.), i.e. this method enables constitution of the so-called certainty limits of particular starting parameters, which are considered as critical ones in the investment effectiveness evaluation. By application of the sensitivity analysis method in the case of two analyzed economic models of vineyard farms, it has been monitored development of the investment effectiveness indicators in relation to the changes of starting parameters and there have been determined their certainty limits.
risk; uncertainty; grape production; model; sensitive analysis