The first three rounds of each season are classified as grading games. Grading games are played to ensure that the that teams are graded into their correct competitions to make every game in the regular season as competitive as possible.
When the Club registers each team with the KBA, the club suggests an initial grade. The teams Round 1 starting grade is a combination of the clubs suggestion and the result of the Association dividing all teams in an age group into groups. During the first three rounds of a season the KBA is looking to achieve a perfect scenario - namely that every match is as close to a draw as possible. Close competition with tight finishes is more enjoyable for the players and spectators and provides better opportunities for player development than games played with large margins. This means that during the three-week grading period for an individual team: consistent big losses may see you move into a lower grade, consistent big wins may see you move into a higher grade or it may mean no changes at all to your team and other teams may move instead.
The mercy (fall back) rule does not apply during grading games. You can read about the mercy (fall back rule) in the KBA junior domestic bylaws found on their website here.