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inc. Business Plan October, 2005

CONTACT: COLLON BROWN, PRESIDENT #5 7820 HARDING AVE. MIAMI BEACH, FL 33141 305 865 3339


CONTENTS I N T R O D U C T I O N Management .........................................................Page Mandat e...............................................................Page Introduction......................................................... .Page Per f ect ore Solution.................................................Page W inning For mula....................................................Page

4 5 6 7 8

P R O D U C T L I N E The Per f ect ore.................................................. .....Page The Cor rect ore............................................... .......Page Manuf actur ing............................................... ........Page Researc h & Development - Per f ect ore Hist or y...............Page

9 10 11 12

M A R K E T I N G Mar ke t Anal ysis.....................................................Page Targe t Mar ke t Trends............................................. .Page Future R&D ...........................................................Page U niversity of Miami - Bio Mec hanics Lab ....................Page Mar ke ting S trat egy.................................................Page Adver tising S trat egy.................................. .............Page Targe t Mar ke ts.......................................................Page

13 — 14 15 16 17 18 — 19 20 21 — 2 2

S A L E S S T R A T E G Y Em ployee Em power ment Program ..............................Pa g e 2 3 — 24 N ew Trends...........................................................Page 25 Sales & Distr ibution ...............................................Page 26 F I N A N C I A L S Expenses............................................ ..................Page Product Per f or mance................................ ...............Page Break Even Anal ysis ............................. ..................Page Cor rect ore Expenses ...............................................Page Cor rect ore Project ed Sales.......................................Page ROI....................................... ..............................Page Capit al Investment Scenar io .....................................Page Risks....................................................................Page

27 — 2 8 29 30 31 32 33 34 35


MANAGEMENT Collon Brown Founder, CEO and President, Head of Product Development Collon has spent the last three years in research and development and test marketing The Perfectore. Collon is a professional designer, educated in economics at the University of British Columbia. Prior to launching Perfectore Inc., Collon owned and operated Alchemy Media Inc., a commercial art house that p r o v i d e d concepts and campaigns in marketing, print, web and media development. Collon has lived an athletic life from a young age. An avid skier, soccer player, tennis player and fitness enthusiast, Collon’s top priority is to pursue a rewarding and active life and inspire others to do so as well. Collon’s initial interest in strengthening with rubber tension and its benefits to the human body was m o t i v a t e d b y t h e f a c t t h a t h e b o u n c e d h i m s e l f b a c k t o h e a l t h o n a t r a m p o l i n e a f t e r a s e v e r e r e s p i r a t o r y injury.

Marina Prospero Vice President of Business Affairs Marina Prospero is a graduate of York University with Honors in Communications and Sociology. A professional in the feature film industry for ten years she fulfilled a variety of management, p r o d u c e r and directing positions. Marina has extensive experience in management, organization and implementation of large-scale productions. She will oversee the day to day operations and manage relationships with shareholders, board of directors, and officers of the corporation, employees, suppliers and distributors.

Wa l t e r S t a s y s h y n , B a r r i s t e r - a t - L a w, B u s i n e s s A d v i s o r Wa l t e r h a s o v e r 4 0 y e a r s e x p e r i e n c e i n c o r p o r a t e l a w. Walter will be providing legal services for Perfectore Inc. Canada, as well as acting as senior advisor to the executive team.

4


inc.

SERIOUS FUN Perfectore Inc. is a product design company dedicated to promoting a safe and healthy way to strengthen the body. We design quality products

MANDATE

that provide a fun approach to achieving better health. Our goal is to become a popular brand

Our mandate is to develop new and innovative products that are used to strengthen the

spearheaded by our core product; The Perfectore

human body and spirit.

and it’s different versions and accessories.

THE OPPORTUNITY There is a unique and superior investment opportunity outlined in the following plan: • Large identifiable global market • Proven science behind elastic resistance training • Substantial market growth • No direct competition • Identifiable demand

5


INTRODUCTION The Perfectore is a wearable body strengthening device. The Perfectore is designed to help the body maintain its sense of balance by improving posture, tightening the core and s t r e n g t h e n i n g the spine. The Perfectore is a sleek tube that loops around shoulders and legs; it is comfortable, fashionable, and minimal. The Perfectore is designed to provide a vast array of health benefits and is coming to the market where new approaches to improving overall wellbeing are being adopted. The Perfectore can be used on its own as a stand alone device or as an enhancement to any exercise routine. The Perfectore is an ideal body strengthening solution for people who are suffering from such health issues as a sedentary lifestyle, lack of physical activity due to aches and pains, slouching, and a weak inner core.

The Perfectore is being prepared for mass production. Its simple, sleek design allows for a streamlined and cost effective manufacturing process.

6


PERFECTORE SOLUTION The Perfectore line of wearable body strengthening devices will help your whole body function more effectively.

Correct posture is the foundation to good health and well-being, along with a strong core, good posture helps to maintain a healthy back, it holds your body upright, improves your balance and enables you to put more force into your arm and leg movements. This culminates in maintaining optimum mobility and protection from the risk of over extending.

The Perfectore is designed to help you to improve your strength, stability and balance.

Daily use, combined with exercise and nutrition is the

solution for a series of health problems that exist in the mass populace, including poor posture, back pain, lethargy and weak inner core strength.

The Correctore is based on the fundamentals of the Perfectore. This abbreviated version works well for those who spend much of their day sitting at the computer. In this position, the Correctore can help improve posture and strengthen the shoulder muscles.

The Perfectore and Correctore awaken a natural awareness of your body. The constant low impact tension forces you to be totally present creating a more effective mind/body connection.

7


WINNING FORMUL A Our winning formula is a combination of these factors:

• no direct competition • first to market • innovative design, ease of use, sleek look • multiple successful distribution channels • global appeal • fills a desperate demand in the market • large target market of variable demographics • savvy marketing strategy • proven science behind product • medical support of effective usage • 2 versions - one specific to employee wellness initiative • answers to trends in health & fitness market • low - tech • cost effective graduated manufacturing plan • made in USA to secure high standards

8


PRODUCT INFORMATION Suggested Retail

$78.88 A unique item designed from one piece of durable rubber

The Perfectore loops around

tubing covered in comfortable

your shoulders and legs and is

silver nylon braid.

affixed at the hips with a clasp that allows you to adjust the length for

SPECIAL FEATURES

additional tension, comfort and support.

• available in two sizes S/M & L/XL • water proof • washable • flexible • fully adjustable • lightweight • easy to use • simple to assemble

Perfectore Hip Clasps & Cross - Over Key

End Clips

The end clips add a finished touch after the individual has sized their Perfectore

S H O U L D E R PA D S Aerodynamic and ergonomic in their unique design, the shoulder pads add comfort and support and are harnessed to the Perfectore with extruded padding.

9


Suggested Retail

$34.99

The Correctore is an abbreviated version of the Perfectore designed to improve posture and strengthen shoulder muscles while sitting. The Cross - Over Key is a

It is ideal for office use.

unique part of the Correctore. A soft silicon mould which allows for the main tube to be “locked” into its effective design.

PA T E N T S

Perfectore/Correctore Booklets • Perfectore/Correctore Instructions

Currently the Perfectore is protected under:

• mind and body motivational exercises

• Canadian Patent Pending Application #2,434,578 retroactive since 2002

• detailed regimen

• Patent Pending Application 2005

• warm up and use suggestions

#US60/594,118 in the United States

• a progress chart • warnings • disclaimers 10


M A N U FA C T U R I N G SUPPLIERS STANDARD PRINTING Bag

Shoulder pads

Cross Section

Booklet & Packaging

Shipped to our rubber

manufacturing facility The Hygenic Corporation, headquartered in Akron, Ohio, is a multinational firm with two d i v i s i o n s : OEM and Specialty Products, which produces a diverse array of non-therapy products for use in a wide range of industries from medical devices to fishing lures, and the Thera-Band division, which manufactures and markets the Thera-Band brand product line.

HYGENIC SUPPLIES

• Rubber tubing • Integration • Packaging • Warehouse

Manufacturing Schedule • 3 months from time of order Turn around time • between 1 and 3 months for each component Initial inventory • 50,000 Perfectores • 25,000 Correctores Rolling forecast • 10,000 of each per month Minimum Order • 10,000 units of each Payment Schedule • tba

The Thera-Band division is the industry leader in new product development and supporting scientific research on the benefits of exercise in rehabilitation, strength building, injury prevention and fitness. In 1999, the company founded the Thera-Band Academy, an international organization composed of leading physicians, therapists, athletic trainers and university faculty to identify new research for funding and develop an international body of knowledge on treating and preventing injuries and disease through various types of exercise. Today, Hygenic has approximately 300 employees worldwide. In addition to its Akron headquarters and manufacturing plant, it operates manufacturing and distribution centers in Ipoh, Malaysia and Hadamar, Germany. 11


RESEARCH & DEVELOPMENT P E R F E C TO R E E VO LU T I O N 2002

2003

• Workout with rubber tubing developed concept of wearing rubber. Experimented with different designs • First Perfectore made with black rubber tie-downs affixed with bolts developed wrap around design

VERSION I

• Recognized the immediate potential because of more erect posture and body’s response to tension • 2 month test period • 2nd test subject • R&D for new materials

VERSION II

• using grey theraband rubber tubing double strand • manipulated materials to simplify design

• applied for first patent pending July 18, 2003

2004 VERSION V

• modified to single strand design

VERSION III

2005 • applied for third patent pending March 4, 2005

TEST MARKET 200 PROTOT YPES RELEASED

• double strand theraband rubber tubing wrapped in neoprene • problem with neoprene body rash

• 100 Sold $50 USD: Canadian National Exhibition Body Soul & Spirit Expo

• USA tour: over 50 sold by word of mouth

• applied for second patent pending

• www.perfectore.com

• Product presentation THANE Canada Inc. • Incorporated Canadian Company • Partnered with Marina Prospero VP of Business Affairs • relocated office

20 sold by recomendation

VERSION IV

• double strand theraband rubber tubing covered in spandex • newly configured adjustable back cross over

PERFORMANCE TESTS

• • • •

Chiropractor testing children’s test multiple bands (up to 8) sports: skating, martial arts,

boxing, soccer, biking, hockey, baseball, basketball exercises: swimming, weight training, running, yoga, pilates, on the ball exercises

• applied for US patent pending March 12, 2005 VERSION VI

• prepare for mass market • identified suppliers with highest quality materials • modified back cross over • modified hip connection

Collon Brown Invent or of t he Per f ect ore The Perfectore was discovered while trying to design some sort of clothing that would work out the body. At the time, I was starting to practice Yoga. This changed my personal philosophy to focusing on over all well being and fitness and longevity.

The rubber tubing and bands being used for fitness and rehabilitation became of great interest to me and I saw a great potential in using this material to design my body motivation device. After only a few experiments I developed what I believed to be the perfect design.

As I researched the human physiology studying the spine and muscles I was motivated to create a wearable device that would continue to stimulate the core area. At the time I was spending much of my time working on the computer.

Over the course of the first year I experimented with different materials that were available at the retail level. I found the proper gage of tubing, fabric cover, clips etc. The initial response to the invention was extremely encouraging.

This journey of discovery and empirical knowledge led me to the development of the Perfectore. I knew that human muscle tissue has very similar characteristics to that of rubber.

After three years of personal use and consistent positive feedback I came to the conclusion that the Perfectore has the potential of mass market appeal.

12


M A R K E T A N A LY S I S The workout industry remains very healthy with a growth that translates into a 11 billion dollar market annually 80% of our target market buys fitness products

through

the retail channel. POSITIVE RESPONSE!

PRODUCT TES TING

Over 90% of people in our

In 3 years of use, the

t e s t m a r k e t introduced to

Perfectore has exceeded

the Perfectore responded

expectations in all areas

positively, and purchased.

of health benefits.

BUYING TRENDS • our target market is comprised of the main purchasers of fitness and wellness products - men/women 25 to 55, which constitutes for *177 million in the U.S. • best selling items on home shopping networks are fitness equipment *yearly 2004 totals 210,820,000 • women 25 to 55 constitute for *77 million in the U.S. and make up the majority of consumers on shopping networks • women are the primary purchasers of products for the family. * Simmons Spring 2004 NCS Adult Full Year Study, Weighted by: Population Amer icans are discover ing t hat exercise and fitness optimize good health

The International Health, Racquet & Sports Club Association (IHRSA) has found a high correlation between age and fitness participation, with older adults exhibiting higher growth rates. 13


M A R K E T A N A LY S I S Per f ectore Product Competition

Exercise Ball

Currently the Perfectore has no direct competition

Indirect competition includes products that increase body strength using rubber tension. These products have increased in popularity,

$19.95

exponentially in the last 10 years. A b-Doer $79.99

Thera-Band $29.95

Pilates Training $19.95

Nautilus Equipment $29.95

Cor rectore Product Competition Available on the market are posture correction devices that harness around the waist. Unlike the Correctore, they do not strengthen or engage the shoulder muscles. They are unattractive and are bulky in comparison to the innovative

The Bebe-jai a posture correction device released into the Asian

Correctore design.

market two years ago sold Posture correction devices Average price range $40

14

over 1 million units.

Lumbar Extender $89.95


TARGET MARKET TRENDS

• • • • •

FACTS THAT SUPPORT THE PERFECTO R E S S U C C E S S • Growing global consumer awareness of positive benefits of good nutrition and fitness • Expanding media attention worldwide on health and fitness • An aging population that is maintaining a more active lifestyle Continued attention to appearance and health by consumers, which is expected to increase as the“baby-boomers” pass through their 40’s, 50’s, and 60’s High healthcare costs that are focusing more attention on preventative practices like exercise Growing rate of obesity which, according to the US Centers for Disease Control and Prevention, increased by 74% among US adults between 1991 and 2002 Government financial support for health and fitness programs intended to combat the growing obesity crisis in the United States Expansion of the market for sophisticated high-quality fitness equipment for the home due to consumers’ continued demand for higher levels of efficiency in their workout regimes

IMPORTANCE OF GOOD POS TURE • keeps joints in the correct alignment so that muscles are being used properly • helps decrease the abnormal wearing of joint surfaces that could result in arthritis • decreases the stress on the ligaments holding the joints of the spine together • prevents the spine from becoming fixed in abnormal positions • prevents fatigue because muscles are being used more efficiently, allowing the body to use less energy • prevents strain or overuse problems • prevents backache and muscular pain • contributes to a good appearance

E M P LOY E E F I T N E S S / IN CENTIVE PROGRAMS Companies of all sizes are realizing the returns of a healthy workforce. Employees

The Trend toward Elastic Resistance Rehabilitation and Strength Training

• • • • • •

are

h a p p i e r,

decrease, and there is

more energy and positive inexpensive and portable attitude in the workplace. requires maximum muscle activation low impact resistance full range of motion engages neuromuscular coordination improves stabilization to maintain proper posture 15

sick

days


FUTURE R&D Future Accessories

Our future success depends on our ability to develop, effectively market and sell new products

that

create

and

respond to new and evolving

• • • • •

consumer demands.

lumbar support kit specialized line of clothing aquatic kit massage unit customized carrying bag for the Employee Empowerment Program

C l i n i c a l Te s t i n g Through the University of Miami biomechanics lab, we have performed a series of scientific tests on how the body performs while wearing the Perfectore. Please see attached documentation for the results. We will continue to scientifically study the benefits to our control groups over the long term.

Osteoporosis The Perfectore has been designed to optimize the strength of the spine which we believe could have beneficial outcomes in the uptake of calcium in bones. As well, the Perfectore is designed to provide daily exercise for the spine’s supporting muscle structures. In association with proper nutrition it is a known fact that these variables prevent osteoporosis. We intend to study the Perfectore’s long term benefits in the prevention of Osteoporosis by doing a series of scheduled bone density tests with our control group.

*Elastic resistance builds strength

Torque of Perfectore Tubing

• Elastic resistance provides a strength curve similar to human strength curves • Exercising at faster speeds does not significantly alter the strength curve with elastic resistance. This allows the body to respond by reacting faster.

* The Scientific and Clinical Application of Elastic Resistance, edited by Phil Page PT & Todd Ellenbecker PT, available from Human Kinetics Publishers at www.humankinetics.com

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UNIVERSIT Y OF MIAMI BIOMECHANICS L AB R E S E A R C H FA C I L I T I E S : Dr. Shihab Asfour, Ph.D. - Professor & Chairman University of Miami’s Ergonomics Lab. The University of Miami’s Ergonomics Research Lab is well equipped and allows research and training studies with human participants. The lab contains several microcomputers and can support a wide range of research in work physiology, biomechanics, anthropometry, strength measurements, psychomotor and closedloop human-machine systems, motion studies, biological signal recording and analysis, environmental stresses, and all aspects of HF research. The Biomechanics Research Laboratory is equipped with the Vicon 512, which is the state-of-the-art human motion capturing system. It consists of eight high speed cameras each of which is capable of capturing up to 250 frames per second with an outstanding resolution of 1000 x 1000 pixels. The Vicon System is integrated and synchronized with: a ground force plate and an instrumented treadmill from Kistler, the most technologically advanced telemetered EMG system from Noraxon, and 4 normal video cameras from Sony. This setup is controlled by one start/stop button, which allows fully synchronized data capturing. In the HF and Aging Research Lab, students study human factors and aging with particular attention to the occupational and home environments. Extensive research is also conducted in the Ergonomics and Bioengineering Division of the Comprehensive Pain and Rehabilitation Center. Hospital and lab facilities are available to conduct research and application pertaining to the problem of low back pain and musculoskeletal injuries. Teaching: TAs assist faculty in class instruction, grading, lab demonstrations, etc. Qualified advanced grad students may be given independent teaching assignments in various undergraduatelevel courses. Current research: NIH/NIA Miami Center on Human Factors and Aging Research, NIOSH Occupational Safety and Health Training Grant, gait biomechanics and baseball pitching biomechanics, sports injuries. Perfectore is committed to continuously testing the Perfectore. New markets may arise from these tests. The Perfectore continues to help people, help themselves.

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MARKET STRATEGY A multi level plan that build integrity and trust in the brand, loyalty in the market and self esteem in our users. A Positive Wave In our literature we will promote a flow of positive energy while wearing

the

Perfectore,

triggering an overall feeling of wellbeing and self empowerment among users.

Building a lif estyle around t he Per f ectore This is a unique concept that includes p o s i t i v e a ff i r m a t i o n s a l o n g w i t h t h e daily regimen. Motivating and encouraging the daily use of the Perfectore, instilling in the user the belief that they are doing something good for themselves simply by wearing it.

Improvement of Daily Lif e

The Int egr ity Repor t

Inspiring each Perfectore user

Continuing process of testing and

to engage in a well balanced

gathering professional endorse-

lifestyle of exercise, proper

ments, testimonials and concrete

nutrition, creative living and high self esteem.

findings that will substantiate the amazing benefits of the Perfectore.

Per f ect ore Chain Reaction Encouraging a word of mouth and “purchase for your loved ones� campaign that will create a chain reaction continually increasing sales 18


M A R K E T I N G S T R AT E GY

Trade Shows

Web Site www.per f ectore.com The web site will be a portal of information on: • Perfectore Inc. • All the Perfectore products and accessories. • Where to purchase • Elastic resistance training • Contact information • Additional informative links and strategic alliances

We intend to bring the Perfectore directly to health practitioners, primarily chiropractic, through personal contact at their industry trade shows. But also having a strong presence in the following industries: health & fitness and office workers who spend much of their day in front of the computer.

In conjunction with we will promote the benefits of elastic resistance training in our products.

Employee Empowerment Program Perfectore Inc. will offer incentives to

special

The Thera-Band® Academy was formed in 1999 to promote and disseminate research, and to provide educational programs and materials for Thera-Band® products around the world.

large corporations

which will include special discounts, motivational seminars and logo branding opportunities.

Thera-Band resistance exercise systems are used as tools for rehabilitating and restoring muscle and joint functions and for improving conditioning, balance and building strength. Thera-Band product lines include latex and latex-free bands, natural rubber tubing.

Brand Recognition The Perfectore Inc. brand and our Perfectore Dancer Logo will be synonymous with feeling great, playful exercise, youth, motivation, and fun. 19


A DV E R T I S I N G S T R AT E GY M A R K E T I N G S T R AT E GY We will hire 3 PR consultants. One in Miami, one in New York and one in L.A. These consultants will identify a VIP list of celebrities and professional athletes in which we will directly market the Perfectore through a complementary sample and brochure campaign. Our sales representative will launch a unique direct mail promotion to the top buyers of our identified distribution channels.

L AU N C H C A M PA I G N

A team of specialized PR reps will introduce the Employee Empowerment Program to our

• 3 month launch campaign

identified fortune 500 corporations in support

• quarter page magazine ads in

of their Employee Wellness Programs.

identified markets • direct mail campaign • public relations campaign • publicity • newspaper editorials

A DV E R T I S I N G S T R AT E GY We will produce a contemporary and graceful photorealistic print campaign that represents our wide demographic of users wearing the Perfectore and the Correctore punctuated with motivational sentiments.

20


TARGET MARKETS GENERAL MARKETS Healthy Lifestyles

Alternate Healthcare

Personal Development

$27.5 Billion

$30.7 Billion

$10.63 Billion

*Lifestyles of Health and Sustainability (LOHAS) 2005

*Lifestyles of Health and Sustainability (LOHAS) 2005

*Lifestyles of Health and Sustainability (LOHAS) 2005

S P E C I F I C Adult Obesity

M A R K E T S

Back Pain

Baby Boomers

59 Million

100 Million

80 Million

*www.mercola.com/2003/ jan/18/obesity_diabetes.htm

*American Academy of Physical Medicine and Rehabilitation

*The Market for Physical Fitness Equipment, Kalorama Market Intelligence

F

R

A

G

M

E

N

T

E

D

Health Club Members

Rehabilitation

32 Million

36 Million

$637 Million

*Simmons Spring 2004 NCS Adult Full Year Study

*International Health, Racquet & Sportsclub Association

*Frost & Sullivan, US Rehabilitation Equipment Markets 1998

Home Gym Equipment

Treadmill Owners

24 Million *Simmons Spring 2004 NCS Adult Full Year Study

M

Depression Sufferers

17 Million *NPS Pharmaceutical CNS Sufferers

A

R

K

E

T S AntiAging

$45 Billion *FIND /SVP Research

Pain Management

$31 Billion “Pain is an Epidemic� American Academy of Pain Management 2005

Sales targets and Profit Projections Perfectore Inc. will directly market

Perfectore Inc. will directly market

Perfectore Inc. will market to baby

to this growing adult obesity

in regard to the back pain market.

boomers. A half of a percentage

market. A half of a percentage

A half of a percentage penetration

penetration into this market

penetration into this market

into this market gives projected

gives projected sales of 400,000

gives projected sales of 295,000

sales of 500,000 P e r f e c t o r e s

Perfectores sold. Equal to a

Perfectores sold. Equal to a

s o l d . E q u a l t o a $6 Million U.S.

$4.8 Million U.S. dollar profit.

$3.5 Million U.S. dollar profit.

dollar profit.

1,195,000 Perfectores in a 3 year period, equal to a 14.3 million dollar

21


TARGET MARKETS A UNIQUE OPPORTUNITY

Dieting Diet-related Products

$40 Billion *National Eating Disorders Association. www.nationaleatingdisorders.org

Perfectore

NODIET

TA B L E O F C O N T E N T S :

Plan for a Healthy Lifestyle

1. INTRODUCTION 1.1 What is the Perfectore 1.2 The Perfectore - Body Regulator & Body Balancer 1.3 The Positive Wave Mentality - and your neural net

2. ABOUT THE PERFECTORE 2.1 2.3 2.4 2.5 2.6 2.7 2.8

Comments by the creator of the Perfectore The Perfectore and its effects on the body The Perfectore and depression The Perfectore and geriatrics The Perfectore and body awareness The Perfectore and the heart Other uses for the Perfectore

3. ANTIAGING AND STRENGTH TRAINING 3.1 The antiaging benefits of Perfectore training 3.2 Prepare to say goodbye to aging 3.3 Tight versus light use 3.4 Osteoporosis and long term Perfectore use 4. STABILITY, POSTURE, BALANCE AND STRENGTH 4.1 Control versus power 4.2 Perfectore’s effects on the nervous system 4.3 Perfectore stabilizing exercises 5. THE ABDOMINALS: THE POWERHOUSE OF STRENGTH 5.1 Release the power of your inner core 5.2 The Psoas muscle - activating the base 5.3 Perfectore Crunches 6. STRENGTH AND FLEXIBILITY 6.1 Perfectore Yoga 6.2 Functional Flexibility 6.3 Band and ball stretches 7. REBUILDING YOUTH 7.1 8. PERFECTORE COOK BOOK

22


EMPLOYEE EMPOWERMENT PROGRAM Perfectore Inc. has identified an effective way to immediately introduce the brand to the mass market by launching an aggressive direct sales campaign to corporations in conjunction with their employee wellness initiatives

Consider t he following:

“Studies on ROI for health

improvement programs range

Poor Posture leads to neck and back pain, poor digestion, obesity, as well as sight and

from $1.49 to $4.91 with a

nerve problems. • Studies estimate between $69-117 billion/year are spent in direct medical costs. • 58 million days of work are lost annually.

median of $3.14 saved for every dollar spent.”

• $5.7 billion is lost in revenue.

Pefectore Inc. is dedicated to helping improve the fitness and overall wellness level of corporate employees, which will also help the corporation to have a healthier bottom line.

Improved posture and physical activity among 88 million inactive Americans could have the following effects: • A reduction of annual direct medical costs of $76.6 billion. • Improved quality of work performed and overall job performance. • Fewer sick days and increased productivity in the workplace. • Your employees will feel empowered by taking control of their own well-being.

23


THE POSTURE STRENGTHENING SOLUTION Introducing the Correctore into the work force is the first step toward improving the health of corporate America. Problems caused by poor

Good posture helps

back support and posture

reduce back pain

• Poor posture cramps the position of the internal

Correct posture is a simple but very important

organs in the body. These organs consist of varied

way to keep the many intricate structures in the

abdominal muscles, the lungs and the heart.

back and spine healthy. It is much more than cosmetic, good posture and back support are

• The body cannot function normally if the organs are

critical to reducing the incidence and levels of back

pushed against each other by the presence of poor posture.

pain and neck pain.

• The circulation of the body is slowed down and ligaments

Back support is especially important for

can be strained

people who spend many hours sitting i n a n o ff i c e c h a i r o r s t a n d i n g

• Poor sitting habits can lead to bad reading habits and

throughout the day.

also then to defective vision. • Neuromuscular fatigue can result from poor posture and

The Correctore is

cause the body to have less energy. The joints become

a simple solution

strained and become also painful.

The Correctore strengthens the

• Often in later years a person can develop severe pain

shoulder muscles and helps to

from backaches caused by many years of poor posture.

correct posture by using rubber

• A person can also become “pot bellied” with constant

resistance.

fatigue and stretching of nerves in the spinal cord. The abdominal organs in the body can also sag. • Sometimes the result of poor posture can be a great deal of foot pain as the feet fatigue very easily.

24


NEW TRENDS Alter native distr ibution networ ks

CORPORATE WELLNESS PLANS A G ROW I N G T R E N D Companies can expect a return of $3 saved on employee healthcare costs for every $1 spent on wellness programs with a saturation of 80% of their work force. Payoff for the company - participating work-

Gyms, Health Practitioners, Online specialty stores, catalogs,

ers health care costs run 10% below costs in comparison to non participating employers. Long term benefits are fewer sick days, higher workplace productivity, higher moral. USA Today, Page 1, Monday August 1st, 2005 “Companies Step up Wellness Efforts” Julie Appleby

• By 2050, the U.S. Census Bureau projects 80 million people will be 65 and older, representing 20.4 percent of the total population, up from 12.6 percent of the population in 2000. (K)

Perfectore as an Accessor y

• Americans ages 65 to 74 have the highest discretionary income. (K)

Treadmills are the top selling exercise equip-

• By 2005, population growth for people ages 45 through 64 is estimated to be 37 percent. Total population growth for the same period is estimated to be 10 percent. (F&S)

ment in the United States, 24 million sold in the year 2004*. The Perfectore increases the

• Approximately one out of four Americans are older than 50. (K)

intensity of a treadmill workout.

• By 2000, the median age of the population was expected to be 36, older than ever before in the history of this country. (K)

(Simmons Spring 2004 NCS Adult Full Year Study)

• Baby boomers (born from 1946 to 1964) accounted for 30.2 percent of the population in 1995, and now number more than 80 million. This group has some of the highest disposable incomes. (K) • Echo boomers, the group between baby boomers and their children, number about 40 million. Many are from nontraditional families with one parent or a blended family. (K) • The children of baby boomers (sometimes called millennials) will grow to 79 million by 2030. (K) • There are more than 28.5 million teens in the U.S., with the number expected to rise through 2010. (K) Growth of the Rehab Market in 1998 (F&S-2) • The rehab equipment market had revenues of $478 million in 1998, a growth of 4.9 percent, expected to reach $637 million by 2005, a 4.2 percent compound annual growth rate. • Market growth is mainly attributed to an aging population.

STRAIGHTEN UP AMERICA C HIROPRACTIC S TATE ASSOCIATIONS

• • •

F&S: Frost & Sullivan, U.S. Fitness and Exercise Equipment Markets, 1997. F&S-2: Frost & Sullivan, U.S. Rehabilitation Equipment Markets, 1998. K: The Market for Physical Fitness Equipment, A Kalorama Information Market Intelligence Report, Nov 1999.

Straighten Up America is a spinal health and wellness module aimed at empowering the American people to improve their quality of life. The program includes three minutes of fun, easy-to-perform exercises and healthy lifestyle recommendations.

25


SALES & DISTRIBUTION

Identified potential distribution channels

Home Shopping Networks make billions of dollars in sales annually. The Perfectore meets all of their criteria in their top selling category of health and fitness products.* • • • • •

Demonstrate well Solve a common problem or make life easier Appeal to a broad audience Have unique features and benefits Is it topical or timely

The Perfectore is an ideal product for retail. It takes up minimal shelf space, it is low cost and has a high rate of return and a high performance potential.

Direct sales to large corporations

that

are into motivating and investing in the wellbeing of their * http://www.vendor.studiopark.com/howto.asp

workforce. How to become a QVC vendor

26


FINANCIALS

EXPENSES PERFECTORE RAW COST BREAKDOWN PICTURE

PARTS

PRICE PER UNIT

PRICE PER 10,000

PRICE PER 100,000

Hygenic Corp.

Rubber & Weave

$12.00

$120,000

$1,200,000

Astro Molding Inc.

Back Crossover

$2.20

$18,500

$166,000

Remington

Shoulder Pads

$2.10

$20,000

$200,000

National Molding

Hip Clasps

$1.00

$10,000

$90,000

National Molding

End Cap

$.01

$100

$1,000

Carry Case

$1.70

$17,000

$170,000

Standard Printing

Booklet

$.14

$1,435

$3,950

Standard Printing

Packaging

$1.00

$9,000

$80,000

Integration, Warehousing Shipping

$.75

$7,500

$75,000

$20.90

$203,535

$1,910,950

COMPANY

Bag Gear

Hygenic Corp.

TOTA L C O S T

CORRECTORE RAW COST BREAKDOWN COMPANY

PICTURE

PARTS

PRICE PER UNIT

PRICE PER 10,000

PRICE PER 100,000

Hygenic Corp.

Rubber & Weave

$5.00

$50,000

$500,000

Astro Molding Inc.

Back Crossover

$2.20

$18,500

$166,000

Remington

Shoulder Pads

$2.00

$20,000

$200,000

National Molding

End Cap

$.01

$100

$1,000

Standard Printing

Booklet

$.14

$1,435

$3,950

Packaging

$1.00

$9,000

$80,000

Integration, Warehousing Shipping

$.75

$7,500

$75,000

$11.10

$106,535

$1,025,950

Standard Printing Hygenic Corp.

TOTA L C O S T

WHOLESALE PRICE

S we a t E q u i t y $ 5 0 0 , 0 0 0

PERFECTORE $38.88 CORRECTORE $17.50

Over 3 years of financial and labor support have been invested in Perfectore Inc. as

RATE OF RETURN

well as financial investment in the form

PERFECTORE 100% CORRECTORE 100%

of personal loans.

27


FINANCIALS

28

EXPENSES

A.

B. ONE TIME COSTS FOR BOTH UNITS

C.


FINANCIALS

PRODUCT PERFORMANCE Minimum and Maximum Sales Projections

PERFECTORE PERFECTORE YEAR 1YEAR 1 Minimum and Maximum Sales Projections

1,000,000

SALES TARGETS PERFECTORE

TOTAL SALES Minimum 110,000 Maximum 410,000

500,000

100,000

Year 1

400,000 units

Year 2

800,000 units

Year 3

1.2 million units

50,000 Max. Min.

10,000

1000

Shopping Networks

Retail

Employee Alternative (web, gym, Empowerment healthcare practitioner) Program

* Projections reflect mimimum and maximum sales of comparable items through our identifiable sales channels.

Minimum and Maximum Sales Projections

1,000,000

SALES TARGETS CORRECTORE Year 1

100,000 units

Year 2

500,000 units

Year 3

1 million units

Minimum and Maximum SalesYEAR Projections 1 CORRECTORE

CORRECTORE YEAR 1

TOTAL SALES Minimum 70,000 Maximum 500,000

500,000

100,000

50,000 Max. Min.

10,000

1000

Shopping Networks

Retail

Employee Alternative (web, gym, Empowerment healthcare practitioner) Program

* Projections reflect mimimum and maximum sales of comparable items through our identifiable sales channels.

29


FINANCIALS

B R E A K - E V E N A N A LY S I S

Disclaimer All information and all projections have been made based upon current statistics and available data. The Perfectore is a first to market product, there is no precedent set in our identified markets. We expect that profits and expenses will vary.

30


EXPENSES

Pefectore Inc. is dedicated to helping improve the fitness and overall wellness level of corporate employees, which will also help the corporation to have a healthier bottom line.

Improved posture and physical activity among 88 million inactive Americans could have the following effects: • A reduction of annual direct medical costs of $76.6 billion. • Improved quality of work performed and overall job performance. • Fewer sick days and increased productivity in the workplace. • Your employees will feel empowered by taking control of their own well-being.

31


PROJECTED SALES

One million units sold = g r o s s p r o f i t s o f $ 10 M i l l i o n Our target market is fortune 500 companies with an employee base exceeding 100 million. With projections of only 1% of the market share, we estimate gross profits exceeding $10 million.

Our break even point can be achieved with just one corporate client.

32


RETURN ON INVESTMENT CAPITAL INVESTMENT PERFECTORE HOLDINGS INC. CB&MP INC.

P E R F E C TO R E I N C . U S A

40% 51% Purchase 500 shares CapitalNOW.

Equity Available 40%

CB&MP INC.

Investment

9%

Required capital $2,000,000 USD

T E R M S O F R E PAY M E N T

BREAK EVEN POINT PERFECTORE

• repayment on principle after 3 years • payment of 20% interest compounded

• 26,795 units

after 3 years

F O U R E X I T S T R AT E G I E S H AV E B E E N I D E N T I F I E D AND ARE LISTED IN ORDER OF PREFERENCE • The shareholding will be valued and offered to the remaining shareholders in proportion to their existing holdings; • Equity may be sold to an external party upon majority approval • Sale of the entire business; or • Initial Public Offering

33


FINANCIALS

CAPITAL INVESTMENT SCENARIO

O N E I N V E S TO R @ $ 2 M i l l i o n = 4 0 % E q u i t y

T WO I N V E S T O R S @ $ 1 M i l l i o n = 2 0 % E q u i t y

F O U R I N V E S T O R S @ $ 5 0 0 K = 10 % E q u i t y

E I G H T I N V E S T O R S @ $ 5 0 0 K = 10 % E q u i t y

34


R I S KS R I S KS A N D U N C E R TA I N T I E S While management is optimistic about the Company’s long-term prospects, the following issues and uncertainties, among others, should be considered in evaluating our long-term outlook. 1. Our failure or inability to protect our intellectual property could significantly harm our competitive position. Protecting our intellectual property is an essential factor in maintaining our competitive position in the health and fitness industry. If we do not or are unable to adequately protect our intellectual property, our sales and profitability could be adversely affected. We currently have several patent and trademark applications pending. However, our efforts to protect our proprietary rights may be inadequate and applicable laws provide only limited protection. 2. Possible inconsistencies in standards, controls, procedures and policies among our products. A deterioration in product quality or increase in product liability could adversely affect our business. We rely on third party manufacturers for a significant portion of our product components, and we may not be able to consistently control the quality of such components. Any material increase in the quantity of products returned by our customers for purchase-price refunds could adversely affect revenues. In addition, we are subject to potential product liability claims if our products injure, or allegedly injure, our customers or other users. We could become liable for significant monetary damages if our product liability insurance coverage fails to cover future product liability claims. 3. Unfavorable economic conditions or geopolitical upheaval could cause a decline in consumer spending and hinder our product sales. 4. Lack of interest. Our identified retailers and distributors don’t respond to our expectations. 5. Manufactures delay. Unforeseen delays in manufacturing from third party suppliers could result in purchase order delays which may incur interest charges, penalties and loss of confidence in the brand. 6. First to market strategy. In the event that our product is leaked while in the manufacturing stages, and a competitor launches a similar product previous to our launch we could lose a significant amount of the market share and our position as a leader. 7. Standard risk of startup company with no operating history 8. Limited management team consisting of Collon Brown and Marina Prospero. 9. Cost of materials rising due natural disaster or economic shift, thus effecting deliverables and profitability 10. Running out of operating capital before return on sales. 11. Current testing has only been done with a small sample of prototypes and small test groups. 12. No direct competition therefore no precedent set in market.

35


2005.BUSINESS.PLAN