BranchOut Food's biggest risks in the FY2024 10-K
- BranchOut Food faces extreme customer concentration, with the top two retailers accounting for 99% of net sales in 2024.
- The company breached Nasdaq minimum equity requirements, holding $2,210,476 in stockholders equity against a $2,500,000 threshold.
- Operations rely heavily on a proprietary dehydration licensing agreement with EnWave and third-party contract manufacturing in South America.
The risks most specific to BranchOut Food
- Risks Related to Our Operating History, Financial Position and Capital Needs
Our failure to meet the continued listing requirements of Nasdaq could result in a delisting of our securities
On April 11, 2024, Nasdaq notified us of non-compliance with Listing Rule 5550(b)(1) as our stockholders equity of $2,210,476 fell below the $2,500,000 minimum requirement.
- Risks Related to Our Business
Our Chief Financial Officer is not a full-time employee
Our Chief Financial Officer, John Dalfonsi, is not a full-time employee and divides his time among other business interests.
- Risks Related to Our Business
Our business is reliant on the license we have been granted to utilize certain dry processing technology we use to manufacture our products in the agreed upon exclusive region
Our manufacturing operations depend entirely on our licensing agreement with EnWave to utilize their exclusive dry processing dehydration technology.
- Risks Related to Our Business
We cannot guarantee that we will succeed in achieving our goals, and our failure to do so would have a material adverse effect on our business, prospects, financial condition, and operating results
Key growth products such as Broccoli Bites, Asparagus Sticks, Mango Chips, and Mandarin Crisps remain in early research and development stages without commercial sales.
- Risks Related to Our Business
Our production equipment may be damaged, adversely affecting our ability to meet consumer and wholesale demand
Contract manufacturers in South America produce a significant proportion of our products, exposing us to foreign facility disruptions.
- Risks Related to Our Business
We rely on big box retailers for a substantial portion of our sales, and our failure to maintain and further develop our sales channels could harm our business
Our top two big box retailers, including Costco, Walmart, and Sam's Club, accounted for 99% of our net sales in 2024.
- Risks Related to Our Capital Structure
Our indebtedness could adversely affect our ability to raise additional capital to fund operations, limit our ability to react to changes in the economy or our industry and prevent us from meeting our financial obligations and our creditors have broad remedies in the event of default
Our total liabilities increased to $10,514,292 as of December 31, 2024, with lenders holding security interests and foreclosure rights across substantially all of our assets.
All 41 risk factors
Headings as the filing states them, in filing order.
Risks Related to Our Operating History, Financial Position and Capital Needs
- 01We are an early-stage company and have incurred significant losses since our inception. We expect to incur losses for the foreseeable future and may never achieve or maintain profitability
- 02Our failure to meet the continued listing requirements of Nasdaq could result in a delisting of our securities
- 03If our available cash balances, net proceeds from financing activities, and anticipated cash flow from operations are insufficient to satisfy our liquidity requirements, we may seek to sell common stock or other securities, and/or seek additional debt financing
- 04Our current growth may not be indicative of our future growth, and our limited operating history may make it difficult to assess our future viability
- 05We may be unable to manage our future growth effectively, which could make it difficult to execute our business strategy
- 06Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud
Risks Related to Our Business
- 07We are dependent on our management team, and the loss of any key member of this team may prevent us from implementing our business plan in a timely manner, or at all
- 08Our Chief Financial Officer is not a full-time employee
- 09Our business is reliant on the license we have been granted to utilize certain dry processing technology we use to manufacture our products in the agreed upon exclusive region
- 10We rely on a small number of suppliers to provide our raw materials, and our supply chain may be interrupted and prevent us from obtaining the necessary materials we need to operate
- 11Competition in the food retail industry is intense and presents an ongoing threat to the success of our business
- 12Our products are new, and our industry is rapidly evolving
- 13We cannot guarantee that we will succeed in achieving our goals, and our failure to do so would have a material adverse effect on our business, prospects, financial condition, and operating results
- 14Our future results of operations may be adversely affected by volatile commodity costs
- 15We are subject to the risks associated with sourcing and manufacturing products from, and conducting business operations outside of the United States, which could adversely affect our business
- 16Our results may be negatively affected by changes in foreign currency exchange rates
- 17We may be unable to adequately protect our brand and our other intellectual property rights
- 18We may not be able to enforce our intellectual property rights throughout the world
- 19Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets
- 20A food safety or quality issue that results in a product disruption such as a recall, health issue, or death of a consumer could harm our business
- 21We may be subject to significant liability that is not covered by insurance
- 22We rely on independent certification for a number of our products
- 23Our future results of operations may be adversely affected by the availability of certifiable ingredients
- 24Adverse weather conditions, natural disasters, crop disease, pests and other natural conditions can impose significant costs and losses on our business
- 25Climate change may negatively affect our business and operations
- 26Our production equipment may be damaged, adversely affecting our ability to meet consumer and wholesale demand
- 27Damage to our brand’s reputation could have a material impact on our results of operations
- 28We rely on big box retailers for a substantial portion of our sales, and our failure to maintain and further develop our sales channels could harm our business
- 29We do not have long-term purchase agreements with our customers
- 30We may not be able to successfully implement our growth strategy for our brand on a timely basis or at all
- 31If we face labor shortages or increased labor costs, our results of operations and our growth could be adversely affected
- 32Consumer preferences for natural and organic food products are difficult to predict and may change
- 33Technology failures or security breaches could disrupt our operations and negatively impact our business
- 34Economic downturns could limit consumer demand for our products and negatively affect our sales and profitability
Regulatory Risks
- 35Tariffs imposed on the importation of our products into the United States would increase the cost of our products and could result in decreased demand for our products
- 36Our products and operations are subject to government regulation and oversight both in the United States and abroad, and our failure to comply with applicable requirements could adversely affect our business and results of operations
- 37Our reputation could suffer from real or perceived issues involving the labeling or marketing of our products
- 38Litigation and regulatory enforcement concerning marketing and labeling of food products could adversely affect our business and reputation
- 39We may face scrutiny from evolving state regulations concerning health, safety, our supply chain and marketing
Risks Related to Our Capital Structure
- 40Our indebtedness could adversely affect our ability to raise additional capital to fund operations, limit our ability to react to changes in the economy or our industry and prevent us from meeting our financial obligations and our creditors have broad remedies in the event of default
- 41We are an emerging growth company and a smaller reporting company, and the reduced reporting requirements applicable to emerging growth companies and smaller reporting companies may make our common stock less attractive to investors
Other BranchOut Food 10-Ks
- FY2025 10-K risk factors43 risks39 new37 dropped2 reworded
BranchOut Food Inc. faces ongoing net losses of $6,124,672 in 2025 alongside a going concern warning. The company relies on customer concentration and working capital while navigating tariff policies. Nasdaq compliance and debt obligations constrain operational flexibility.
Filed Mar 31, 2026
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.