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Risk analysis of the business profitability in agricultural companies using combine harvesters

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  • Miroslav Mimra

    (Department of Machinery Utilization, Faculty of Engineering, Czech University of Life Sciences Prague, Prague, Czech Republic)

  • Miroslav Kavka

    (Department of Machinery Utilization, Faculty of Engineering, Czech University of Life Sciences Prague, Prague, Czech Republic)

  • František Kumhála

    (Department of Agricultural Machines, Faculty of Engineering, Czech University of Life Sciences Prague, Prague, Czech Republic)

Abstract

This article presents the results of entrepreneurial risk analysis in a company providing agricultural services where a group of combine harvesters is used. An economic model was created in order to emulate the operational costs of the combine harvesters using MS Excel. Based on the results of the sensitivity analysis, the key factors were determined. For these factors, the risk of achieving the desired economic results was created subsequently. For the simulated situation, the key factors were activated within the range of ± 10% using a triangular distribution of these values. The result of this analysis showed that the most frequent value of CZK 389,692/year will be achieved with a probability of 49.42%. The overall outcome of the combine harvesters should be profitable.

Suggested Citation

  • Miroslav Mimra & Miroslav Kavka & František Kumhála, 2017. "Risk analysis of the business profitability in agricultural companies using combine harvesters," Research in Agricultural Engineering, Czech Academy of Agricultural Sciences, vol. 63(3), pages 99-105.
    • Handle: RePEc:caa:jnlrae:v:63:y:2017:i:3:id:63-2016-rae
    DOI: 10.17221/63/2016-RAE
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    References listed on IDEAS

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    3. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    4. Josef Pulkrábek & Miroslav Kavka & Vladimír Rataj & Jaroslav Humpál & Ladislav Nozdrovický & Zdeněk Trávníček & Vladimír Pačuta, 2012. "The assessment of the economic risks level of sugar beet growing for the farm economy," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 58(1), pages 41-48.
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    Cited by:

    1. Karel Kubín & Martin Pexa & Michal Holúbek, 2021. "Calculation model of the tractor transport set - Economic and environmental indicators," Research in Agricultural Engineering, Czech Academy of Agricultural Sciences, vol. 67(2), pages 65-73.

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