BUSINESS PLAN

Introducing First Aid Kits in Uzbek Market

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TABLE OF CONTENTS

1.0 EXECUTIVE SUMMARY 2.0 COMPANY SUMMARRY The First Aid Kit Company will be associated under Asklepiy pharmaceutical company. Main business of First Aid Kit Company is manufacturing first aid kit bags, wrapping all the first aid contents, and delivering and selling them to the target market. The company will be associated under Asklepiy Ltd. pharmaceutical company which was established in 1993 and has become the major distributor of pharmaceutical products in Uzbekistan. The Company Asklepiy provides full range of logistic services, storage of pharmaceutical goods and delivery of them which means, on the one side, it can be one of the main suppliers of the First Aid Kit Company. 2.1 LEGAL FORM OF BUSINESS The company is incorporated in Tashkent, Uzbekistan. The legal form of company First Aid Kit will be a subsidiary company of Asklepiy Ltd. 2.2 MISSION STATEMENT Aiding your health the first 2.3 GOALS AND OBJECTIVES Produce quality First Aid Kit products which corresponds to World Health Organization and Ministry of Health (Uzbekistan) requirements;

Develop alliances with automobile producing, selling and renting companies, medical organizations and business entities (servicing and production) in Uzbekistan by the end of year;

The Company will have a market share of 4% by the end of year 2010; The Company will increase its profits by adding new sales items (see Part 3); The Companys total gross sales will rank in the top 50% for its industry by 2010

2.4 RUNNING THE PROJECT

Facility for production and warehouse Take license and certificates Finance the business Buy first aid kit bags, medicines and other items Employ workers for administrative and production

2.5 START-UP EXPENSES/OPENING DAY BALANCE SHEET

2.5.1 START-UP EXPENSES

Start up Administrative Expenses
Name Notarizing charter and Constituent agreement Register with the local authority (khokimiyat) and obtain the certificate of state registration Manufacturing seals and stamps Notarization of original signatures, assuming 5 signatures Certificate of Hygiene Open a permanent bank account with a local bank Charter capital (30% immediate) Trademark registration Total start up administrative cost 3 81000 50000 0.02x5 10 0- 1 50 3000 270000 1000 405000 250000 92600 0 46.29 28.57 1.71 154.29 0.57 231.43 142.86 529.1 4 MMW 0.25 UZS 7000 USD 4.00

Start-up Operative Expense

Expenses Buildings/real estate Leasehold improvements Capital equipment Location/administration expenses Opening inventory Advertising/promotional expenses Other expenses Contingency fund Working capital Total Startup Expense UZS 27,000,000.00 0.00 27,500,000.00 6,526,000.00 302,428,728.18 10,000,000.00 1,000,000.00 0.00 50,000,000.00 424,454,728.1 8 USD $18,000.00 $0.00 $18,333.33 $4,350.67 $201,619.15 $6,666.67 $666.67 $0.00 $33,333.33 $282,969.8 2

2.5.2 BEGINNING BALANCE SHEET

BALANCE SHEET ASSETS Cash in Bank Inventory Prepaid Expenses Other Total Current Equipment Furniture Fixtures Land Other Total Fixed Total Assets LIABILITY Total Interest Payable Taxes Payable Accrued Rent Bank Loan Payable Directors salaries others Total Liability Invested capital Retained Profit Total Capital Total Liability and Capital BALANCE 3,537,122.73 1,752,734.01 1,000,000.00 35,371,227.35 11,050,000.00 500,000.00 53,211,084.09 302,428,728.13 23,286,323.24 325,715,051.3 7 378,926,135.4 6 0.00 January 23,286,323.24 302,428,728.13 325,715,051.3 7 10,000,000.00 15,000,000.00 2,000,000.00 25,000,000.00 1,211,084.09 53,211,084.09 378,926,135.4 6

Current

Fixed

CAPITAL Total

3.0 PRODUCT Recently, car manufacturing industry is continuing to increase rapidly in Uzbekistan. Although, increased number of automobiles are bringing enough comfort, at the same time causing to raise the number of car accidents. Therefore, the first aid kit will be the important tool to minimize injury and future disability. In serious cases, first aid kit may be necessary to keep the victim alive.

According to statistics1, the number of death and injuries in car accidents in Russia accounted for 35 602 and 243 919 respectively in 2003.

Years 2000 2001 2002 2003

Number of death 29.594,00 30.916,00 33.243,00 35.602,00

Number of injuries 179.401,00 187.790,00 215.678,00 243.919,00

In general, as a consequence of car accidents average 1 260 000 people died and more then 50 000 000 people injuries in a year over the world. In 2002, the death rate as a result of car accidents took 9th place among other diseases. According to the statistics given by the WTO (World Health Organizations) if this tendency keep rising, by the end of 2020 death rate from car accidents take over tuberculosis, AIDS, malaria, and insult, and win proudly 3rd place. Over the world, financial loss from car accidents make up average 518 $ billion in a year, from which 100 $ billion is the portion of developing countries. According to the statistics of WTO, if automobiles have all accessories including first aid kits the number of death will decrease by 50%. Moreover, it depends on the quality and speed of medical first aid. The investigation which was conducted in Europe shows that people die from car accidents: 50% - in the place of accident, or on the way to hospital; 15% - in hospital, during 4 hours after accident; 35% - in hospital, after 4 hours;

The important thing in this case is the quality and speed of first medical service. In this sphere many noticeable works are carrying out in Uzbekistan but there still exist some serious problems. Therefore, this problem can be solved and decreased by introducing first aid kits in Uzbekistan. Besides, year by year the number of organizations and companies is increasing significantly which means the number of employees is increasing as well. However, according to the primary research 90 % of organizations do not have first aid box and this means companies or organizations do not take care enough of the health of their employees. Hence, it might affect negatively to
1

Finance Magazine, #7 2004,

the companies and organizations. Despite, based on primary research, in 65% of developed and developing countries there is a first aid box in the companies and organizations and they even have law which states every company and organization must have first aid box. Therefore, it is considered that it is necessary in Uzbekistan and first aid kit should be produced for the organizations and companies. Furthermore, the birth rate is 630 000 in Uzbekistan, and according to the result of primary research there are good demand for Mother & Baby first aid kits. 3.1 PRODUCT SPECIFICATION There are three primary goal of first aid: Preserve life Prevent further injury Promote recovery

In order to respond to the primary goals of first aid, our product content will provide the following items: 1. Auto First Aid Kit
Items 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 0,06 10 - 0,25 10 5%- 10 .. 2040 5 . 25 20% 1 2 10%- 10 - 3%- 10 25 5% 25 . 250 N10 "" 102, 104 5 10 / 5 10 .../ 50 7-8 50 ..."Savers".8,5 Price 167.2 3 70 215 700 170 250 778 160 190 388.3 7 330 215 600 360 260 285 850 813.4 Quanti ty 1 1 1 1 1 1 1 1 1 1 1 1 1 2 2 1 1 1 Total 167.23 70 215 700 170 250 778 160 190 388.37 330 215 600 720 520 285 850 813.44

19 20 21 22 23

Scissors Bag Instruction booklet . 1%- 10 0,0005 40 Total

4 282 1222 50 200 440

1 1 1 1 1 25

282 1222 50 200 440 9616. 04

Bag Manufacturer: Guangzhou Far East Bag Products Co Ltd. Guangzhou Winnie Luggage & Bag Factory Address: No.5 Huanan Road Xinhua Town, Huadu District Guangzhou City China 510800 Contact: Mr. Silwen Tel: 0086 20-3685 3202 / 0086 20 6180 2517 E-mail: ydbags@gmail.com

Item Name First Aid Kit Bag

Packing Specification 25x16x7cm pcs/carton 1pc/opp bag 200pcs/ctn Material Polyester

Unit Price USD 0.87

Unit Price UZS 1297

Remarks C&F Chuqursoy

1. Payment terms: 30% deposit and the balance payment before shipping. 2. Delivery time: 45days after the samples approved. 3. Sample lead time:7days

2. First Aid Kit for companies/organizations

Items 1 4% 100 Price 2822.6 6 Quantit y 1 Total 2822.66

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

10%- 10 5 10 / 5 10 .../ 50 . 250 N10 "" 102, 104 0,06 10 - 0,25 10 5%- 10 7-8 50 ..."Savers".8,5 25 0,0005 40 . 1%- 10 3%- 50 .. 2040 5 . 20% 1 2 Termometr kaliy permanganate Sitramon Analgin Nojnisa Sumka 25 0,0005 40 Parasetamol 1,2 20 Total

160 360 260 285 215 600 167.23 70 215 850 813.44 388.37 440 200 250 700 778 700 300 50 170 282 1222 250 440 200 1000

1 3 3 1 1 1 1 1 1 1 1 1 1 1 1 2 1 1 1 1 1 1 1 1 1 1 1 33

160 1080 780 285 215 600 167.23 70 215 850 813.44 388.37 440 200 250 1400 778 700 300 50 170 282 1222 250 440 200 1000 16128. 7

3. Mother&Baby First Aid Kit

Items 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 5 10 / 5 10 .../ 50 . 1%- 10 5%- 10 "" 102, 104 .. 2040 5 . 3%- 50 5 .20 20,0 . / "" gubka tualetnaya kaliy permanganate krem detskiy milo detskiy pipetki glaznoe 2 soski pustishki Termometr Instuksiya Futlyar Total

Price 360 260 285 200 215 600 700 250 313.5 310 624.7 5 759.2 4 300 300 1000 645 300 360 700 50 1222

Quanti ty 2 2 1 1 1 1 1 1 1 1 1 2 1 1 1 1 1 2 1 1 1

Total 720 520 285 200 215 600 700 250 313.5 310 624.75 1518.48 300 300 1000 645 300 720 700 50 1222 11493. 73

4. Universal (Home&Family) First Aid Kit

Items 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4% 100 10%- 10 5 10 / 5 10 .../ 50 . 250 N10 "" 102, 104 0,06 10 - 0,25 10 5%- 10 7-8 50 ..."Savers".8,5 25 0,0005 40 . 1%- 10 3%- 50 .. 2040 5 . 20% 1 2 Termometr kaliy permanganate Sitramon Analgin Nojnisa Sumka - 3%- 10 25 0,0005 40 1,2 20 Total Price 2822.6 6 160 360 260 285 215 600 167.23 70 215 850 813.44 388.37 440 200 250 700 778 700 300 50 170 282 1222 190 250 440 1000 Quanti ty 1 1 2 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 30 Total 2822.6 6 160 720 520 285 215 600 167.23 70 215 850 813.44 388.37 440 200 250 700 778 700 300 50 170 282 1222 190 250 440 1000 14798 .7

3.2 MOST IMPORTANT AND UNIQUE FEATURES

New type of packaging, which has comfortable style, economical and new design; Low product cost; Availability of after sale service: the company provides 24 hour emergency call service for supporting and informing customers about the use of first aid kit medicines and how to act in different situations;

Full coverage of items which are confirmed by Ministry of Health; Excellent quality of items and packaging; Clear instructions of first aid kit usage in three languages (Uzbek, Russian and English);

3.4 LONG-TERM PLAN 4.0 MARKETING PLAN

4.1 TARGET MARKET Demographic and Economic Profile of Uzbekistan

Indicator Area Total population Female Female Male Male Rural Urban Density Dynamic increase during the year: total Dynamic growth urban population Dynamic growth rural population Balance of migration: arrived to republic Balance of migration: left republic Birth Death Dynamic: natural increase GDP Real GDP growth Inflation Minimal wage Consumer expenditure Annual gross income Annual disposable income Units km2 at the beginning of the year 000 persons in % to total 000 persons in % to total 000 persons 000 persons People per sq. km % During the year % During the year % 000 persons 000 persons 000 persons 000 persons 000 persons measured at purchasing power (million international $) % growth % growth in soums US $ million US $ million US $ million 2008 447,700 27,296.70 13,536.90 50.00 13,535.20 50.00 17,279.50 9,762.30 57.00 1.10 0.70 0.90 74.80 85.00 630.00 136.30 484.50 2009 447,700 28,376.00

65,337.84 6.98 12.54 28,040 15,119.54 18,891.99 15,684.17

Sources: 1. UNDP: Uzbekistan in Figures, 2009 2. World Economic Factbook, 2009

The map of Uzbekistan

TARGET MARKET

The target market of the company will be divided into three segments and will follow analyzed strategy of following segment actions. SEGMENT-1 The FAK enterprise will hold vehicle (car) manufacturing industry as an initial target market, founded by Uzavtoprom which holds 25% shares of GM Uzbekistan Joint Venture Company. The profile of GM Uzbekistan is stated in detail below in Figure 1. As this company is considered single passenger car manufacturing company in Uzbekistan it is found as a base of target market, there is going to be a proper agreement on profit between Uzavtoprom and with FAK Company. The next approach is to hold all existing transports on the road in territory of Republic of Uzbekistan by using adopted legal requirements of passenger cars based on law of Uzbekistan. SEGMENT-2 The second segment of the company will be to hold all registered

companies/organizations within government of Uzbekistan both servicing and producing companies by providing first aid kit products to those existing organizations. SEGMENT-3 In the third stage the company will act its target market to new born babies and mothers in Uzbekistan by providing the companys mother&baby first aid kits as a gift to new born babies at maternity hospitals (Ministry of Health of Uzbekistan).

Figure 1 ENTITY PROFILE Uz-Daewoo Auto-GM Uzbekistan Company GM Uzbekistan (Uz-Daewoo Auto) Date of formation 1992-Uz-Dawoo Auto, 2007-GM Uzbekistan Structure of founders 25%-UzAvtoProm PC Activity Manufacture of cars

Uz-Daewoo Auto CJSC was set up on parity basis by the UzAvtoProm Uzbek Association of Automobile Building Enterprises and South Korean Daewoo Motors. In 1996 the JV launched a car factory worth US$650 million and became one of the first companies in Uzbekistan introduced on practice this model and received the certificate of conformity to requirements of standard ISO 9001:1994 from international certified body BVQI which main office settles down in Paris. In 1996, the company commissioned a car construction plant in Andijan region with project capacity of 200,000 cars annually. In May 2005 UzAvtoProm JSC bought out Daewoo Motors' 50% stake in the venture for some US$110 million. In the mid-October 2005 Uz-Daewoo Auto prolonged the contract with the American General Motors for the delivery of component parts to 2010. In September 2007, General Motors and UzAvtoProm set up GM Uzbekistan on the base of the Asaka factory. GM Uzbekistan will assemble three Chevrolet models Captiva, Epica, and Tacuma. The total capacity of the plant is 50,000 units with the possibility of upgrading to full-scale production within three years. According to the terms of the contract on the establishment of joint venture, General Motors has 25% interest in the enterprise, with the possibility of subsequently increasing it to 40%. Vehicle Background Varianc e Duratio n Under Nexia 1996- Uz-Daewoo Auto Damas 1996- Uz-Daewoo Auto Tico 1996-2003 Uz-Daewoo Auto Matiz 2001- UzDaewoo Lacetti 2003- GM Uzbekistan Epica 2008- GM Uzbekistan Tacuma 2008- GM Uzbekistan Captiva 2008- GM Uzbekistan

Auto

Table 1 Uz-Daewoo Auto

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010* Net Total Export Total after exp. Nexia 12,229 22,882 30,111 37,340 44,569 47,798 49,727 51,956 64,185 66,798 74,095 84,824 85,474 75,000 N/A 746,988 20% 597,590 Damas 8,664 5,756 6,787 7,576 7,665 8,154 8,543 8,612 12,121 12,340 14,204 24,467 31,679 24,000 N/A 180,568 20% 144,454 Tico 4,764 13,843 21,072 28,301 35,530 36,259 36,688 36,917 N/A 213,374 20% 170,699 Matiz 11,252 16,902 18,754 41,256 42,902 50,226 59,796 71,679 60,000 N/A 372,767 20% 298,214 Lacetti 326 750 950 1,555 2,722 5,032 25,000 N/A 36,335 20% 29,068 Total 25,657 42,481 57,970 73,217 87,764 103,463 112,860 116,565 118,312 122,990 140,080 171,809 193,864 184,000 225,000 1,551,032 20% 1,240,826 Monthly 2,138 3,540 4,831 6,101 7,314 8,622 9,405 9,714 9,859 10,249 11,673 14,317 16,155 15,333 18,750

Note:* The amount of vehicles in total and per month for 2010 year has not been considered to total after export calculation.

Sources: 1. Uz-Daewoo Auto Project, March 23, 1998 2. Uz-Trade, 2009, (State Statistics Committee) 3. Ansher Capital, 2008, Daily Digest 4. Uzbekistan: Transport Sector Strategy 2006-2020, December 2006 5. Uzreport: 2009, UzAvtoProm. Table 2

GM Uzbekistan
Epica 2008 2009 2010* Net Total Export Total after exp. 207 540 N/A 747 16.6% 623 Tacuma 863 2,196 N/A 3,059 16.6% 2,551 Captiva 104 264 N/A 368 16.6% 307 Total 1,174 3,000 25,000 4,174 16.6% 3,481 Monthly 98 250 2,083

Note:* The amount of vehicles in total and per month for 2010 year has not been considered to total after export calculation.

Sources: 1. Uz-Trade, 2009, (State Statistics Committee) 2. InterFax, 2009, GM-Uzbekistan reduces auto output 3. UzInfoInvest, 2008, Uzbekistan to strengthen GMs positions 4. Uzreport: 2009, UzAvtoProm.

Table 3 Vehicle Statistics of Uzbekistan: Transports on the road

Year 1995* 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Total

Cars 834,000* 25,657 42,481 57,970 73,217 87,764 103,463 112,860 116,565 118,312 122,990 140,080 171,809 196,212 187,000 2,390,380

Commercial Vehicles 266,000* 2,500 3,000 5,500 8,580 6,849 7,278 13,833 8,302 10,000 14,900 13,000 16,000 375,742

Total 1,100,000* 28,157 45,481 63,470 73,217 87,764 112,043 119,709 123,843 132,145 131,292 150,080 186,709 209,212 203,000 2,766,122

% change 61.5% 39.6% 15.4% 19.9% 27.7% 6.8% 3.5% 6.7% 0.6% 14.3% 24.4% 12.0% 3.0%

Note:* As of 1995, there were 834,000 passenger cars and 266,000 trucks in Uzbekistan. The average age of vehicles on the road was nine years. Ninety-five percent of the vehicles had been made in Russia (Harvard Business School, Daewoos Globalization: Uz-Daewoo Auto Project, March 23, 1998)

Sources: 1. OCIA, 2009, Production Statistics. 2. Uz-Daewoo Auto Project, March 23, 1998 Table 4 Birth profile among provinces of Republic of Uzbekistan- 2009
# Regions Area km2 Populati on persons Distric ts quantit Female Persons % Male persons % Birth Persons % Death person % s

y 1 2 3 4 5 6 7 8 9 1 0 1 1 1 2 1 3 Andijan Bukhara Djizzak Fergana Kashkadarya Khorezm Namangan Navoi Samarkand Surkhandarya Syrdarya Tashkent Karakalpakista n Total 4,200 39,400 20,500 6,800 28,400 6,300 7,900 110,80 0 16,400 20,800 5,100 15,300 165,80 0 447,70 0 2,328,113 1,697,597 1,116,243 3,183,837 2,487,488 1,471,161 2,282,752 940,930 2,846,697 2,054,723 794,549 5,455,555 1,716,355 28,376,0 00 14 11 11 15 14 10 11 8 16 14 9 15 15 163 1,164,057 848,799 558,122 1,591,919 1,243,744 735,581 1,141,376 470,465 1,423,349 1,027,362 397,275 2,727,778 858,178 14,188,0 00 8.2 6.0 3.9 11.2 8.8 5.2 8.0 3.3 10.0 7.2 2.8 19.2 6.0 50 1,164,057 848,799 558,122 1,591,919 1,243,744 735,581 1,141,376 470,465 1,423,349 1,027,362 397,275 2,727,778 858,178 14,188,0 00 8.2 6.0 3.9 11.2 8.8 5.2 8.0 3.3 10.0 7.2 2.8 19.2 6.0 50 51,684 37,687 24,781 70,681 55,222 32,660 50,677 20,889 63,197 45,615 17,639 121,11 3 38,103 629,94 7 8.20 5.98 3.93 11.22 8.77 5.18 8.04 3.32 10.03 7.24 2.80 19.23 6.05 2.22 11,175 8,148 5,358 15,282 11,940 7,062 10,957 4,516 13,664 9,863 3,814 26,187 8,239 136,20 5 8.20 5.98 3.93 11.2 2 8.77 5.18 8.04 3.32 10.0 3 7.24 2.80 19.2 3 6.05 0.48

Attention: Probability of maternity hospitals is ranged for every 90,000 population in Republic of Uzbekistan which gives approximately 315 maternity hospitals all over regions of Republic of Uzbekistan. This particular information has been just taken probable.

Sources: 1. UNDP: Uzbekistan in Figures, 2009 2. United Nations: Provinces of Uzbekistan

4.2 Competition

Primary competitor Competition analysis is very important for any business before start up since it help to identify risks in the market and the industry that the company is entering. After conducting research and analyzing the market, it has been found out that there is no high competition in first aid kit industry. Currently, there is one primary competitor Sarbonteks JV which produces only Auto firs aid kit. Competitors Sarbonteks Product FAK for car Price 13500 sums Adress Market share Sirdaryo v. Baxt NA sh. Bainalminal.

SWOT analysis of competitor

Strengths Already operating in the market Production company of different types of bandages Self supplier Opportunities Almost no competition and easy to get large market share Increased car manufacturing, birth rate, and number of organizations Supporting Government regulations and acts Weaknesses Using expensive case made product expensive No agreement with companies Small product range (only Auto first aid kits) Poor packaging No promotion Production area far from Tashkent Threats Items inside the FAK can expire. Entering new competitors

Indirect competitor

All existing large medicine companies such as Jurabek Ltd, Lahisam and etc. can be indirect secondary competitors for the company, because all of them sell medicines that come on FAK and many of them can be potential competitors. Therefore, all these indirect competitors will be considered.

SWOT analysis of our company

Strengths Asklepiy already exists in the market as medicine distribution company Affordable price Comfortable packaging Popular Brand name Comfortable location Weaknesses First time in FAK industry Some items in the FAK will be bought from competitor Sarbonteks

Opportunities Almost no competition and easy to get large market share Increased car manufacturing, birth rate, and number of organizations Supporting Government regulations and acts

Threats Competition Exchange rate Inflation Financial instability of Uzbekistan

DEMAND FORECAST Table 3 Demand for Auto (Universal) FAK January-December 2010 year
5000 4500 4000 3500 FAK quantity 3000 2500 2000 1500 1000 500 0 Auto (Universal) FAK units J anuary February March Aprel May J une J uly August Septem ber October Novem ber Decem ber

Table 4 Demand for Mother&Baby FAK January-December 2010 year

60000 J anuary 50000 40000 FAK quantity 30000 20000 10000 0 Mother&Baby FAK units February March Aprel May J une J uly August Septem ber October Novem ber Decem ber

Table 5
Demand for Organization/Company FAK January-December 2010 year
7000 J anuary 6000 5000 FAK quantity 4000 3000 2000 1000 0 Organization FAK units February March Aprel May J une J uly August Septem ber October Novem ber Decem ber

Table 6 Demand for Universal FAK January-December 2010 year

7000 J anuary 6000 5000 FAK quantity 4000 3000 2000 1000 0 Universal FAK units February March Aprel May J une J uly August Septem ber October Novem ber Decem ber

Table 7 Total demand (all categories) January-December 2010

100000 90000 80000 FAK quantity 70000 60000 50000 40000 30000 20000 10000 0
Ja nu ar y Fe br ua ry M ay Au gu Se st pt em be r O ct ob er N ov em be D r ec em be r M ar ch Ap re l Ju ne Ju ly
Total production volum e

5.0 MARKETING STRATEGY 5.1 METHODS OF SALES AND DISTRIBUTION 5.1.1 SALES METHOD 5.1.2 DISTRIBUTION METHOD

As Asklepiy already has full range of services on organizing, shipping and delivery to Uzbekistan, we will distribute by the help of Asklepiy distribution system. As it was mentioned above our storage will be located not far from Asklepiy storage and from our storage the FAKs will be distributed through network of drugstores that belongs to Asklepiy. Moreover, Asklepiy also have full coverage of entire market of Uzbekistan through the network of branches and this means by helping those network branches we will distribute to all of the regions of Uzbekistan.
Transportation Cost from xls

5.2 PACKAGING The company should consider the following issues while packaging the products: Quality of packaging; Convenience of bag, carrying, taking medicines, replacing; Good-looking Design; Noticeable Color; Auto First Aid Kit has the abovementioned specifications. The bags are importing from China, Guangou. Bags are made from polyester which makes it water-resistant, heatproof and difficult to tear. That shows that the quality of auto bags is good enough. Also, the size of the bag is 25x16x7 cm which is targeted to make it convenient for carrying, replacing and not taking big space in a car. Moreover, it has new, good-looking design and noticeable red color.

Organizations First Aid Kit also has its advantages. The case is made from white color plastic and the size of it is 260x300x110cm. It can be set on the wall and placed to other places. The design is a rectangular box and has special places for each medicine.

Mother & Baby First Aid Kit is also made from polyester and imported from China. The quality of bag is the same with car first aid kit bag: water-resistant and heatproof. However, the size is going to be 18.3x13.5x6 cm. and the color is white/blue with the picture of happy mother and healthy baby. The design is good-looking and new in the market. Universal First Aid Kit is made from polyester and produced in China. The design is rectangular box with pictures of happy family. It is designed for putting in the shelves and small places. The color will be the mixture of white and blue. Long term Plan Starting from 2011 the company will produce First Aid Kit for Travel. The packaging will be made from polyester material and imported from China. It will be convenient for carrying and taking medicines. The bag will have comfortable design and attractive color.

5.3 PRICING Setting the price of the product based on methods such as cost-plus pricing and competitive pricing. We considered direct costs (see part 3.1) and profit goals (see below), competitors' activities (see part 4.2), and how the customers perceive the value of product (see part 5.9) when choosing this pricing strategy.

The company would set mark up pricing strategy. Mark up percentage depends on the type and content of product.

32.75 % mark up price for the Auto (GM) First Aid Kit [32.75% = 3019.09 UZS] 23.45 % for the Mother & Baby [23.45% = 2501.70 UZS] 33.85 % mark up price for First Aid Kit for Organizations [33,85% = 5001.70 UZS] 28.50 % mark up price for Universal [28.50% = 2856.73 UZS]

Competitive position Our pricing strategy takes into account the competitors price as well. According to the competitive analysis the first aid kit products costs are lower than competitors price which gives price advantage for the company. Therefore, above given mark up price will be used in order to promote and capture the planned market share. However, we need to be careful, since competitors can find sources for low cost as well. So, pricing will be competitive but profitable.

QUALITY

HIGH

First Aid Kit

Sarbontextile JV

LOW

First Aid Kit Company should position itself as a better quality producer with medium price. Successful agreements and introduction of the company will increase brand popularity and loyalty of customers. Also, it is essential to compete with the FAK competitors.

LOW

PRICE

HIGH

5.4 BRANDING 5.5 SALES FORECAST 5.6 SALES INCENTIVES/PROMOTION

Promoting our product is vital step of achieving our objectives since effective ways of promoting strategies will add large contribution to the sales of our company. Therefore, taking into account that we are new entering company in the market, it will be important to use massive advertising month before selling our product. Hence, it will help us to know all advantages and disadvantages and analyze all necessary aspects of our products. To implement those jobs high qualified marketer will be hired. Moreover, we are going to communicate with some companies to promote and sell our products. Here is the list of the companies that we are going to communicate and cooperate. General Motors in Uzbekistan; SamAuto; Lada; Public Transports and Taxi service companies; Organizations and companies both production and servicing; Maternity Hospitals; Drugstores For the successful positioning and increasing sales volume the company uses following advertising tools: Television Radio Billboards Large screens in the conjunctions (effective way of capturing drivers attention ) Newspapers Public transports
5.7 ADVERTISING STRATEGIES 5.8 PUBLIC RELATIONS 5.9 VALUE PROPOSITION 6.0 OPRATIONAL PLAN This part describes the scenario of production process with the production requirements. The First Aid Kit bags, safety scissors and medical gloves will be imported from China (Ningbo medical goods). 6.1 PRODUCTION For the production of First Aid Kits we do not need advanced technologies. Main production process is wrapping first aid kit and its items. The production process consists of three main stages:

1. Delivering First Aid Kit bags and contents to the production line 2. Wrapping First Aid Kits

3. Racking ready products to warehouse

So, production methods will be developed considering the main process. Production techniques and costs The production process will be operated manually. Delivering medicines, wrapping kits and storing to warehouse will be done manually.

Quality control In order to produce good quality products and deliver it on time the company uses FIFO method (First In First Out). First Aid Kit contents which are brought first to the warehouse will be brought to the production line the first as well. The advantage of this method is that the company saves the product contents to be out of date. The minimum validity year of product is 2 years. To make sure that all medicines and items wrapped there will be double check process. Before wrapping the kit and after wrapping the items will be checked according to the first aid content list (See Part 3.1). Moreover, quality control system of the company corresponds to the objectives of the company which is producing quality products. So, the company provides quality first aid kit items and medicines which will be bought from only professional suppliers (for more information see Part 6.5). Inventory control In order to manage the inventory successfully the company uses FIFO method combining with the Sales plan (5.1) and Demand forecasts (4.4). The company keeps 10% of raw material and 10% of ready products in a warehouse all the time so as to be ready to sudden changes (shortages of raw materials and sudden increase of demand). 6.2 FACILITY The company takes building for rent. There should be warehouse for raw materials and warehouse for finished goods and production place. Physical requirements

Amount of space: plant size 60m x 48m, height 3m; Type of building: Production line with warehouse; Zoning: Near to Asklepiy Ltd s plant and warehouse;

Power and other utilities: No need powerful electricity and water sources;

6.3 LEGAL ENVIRONMENT Certificate of origin issued by Chamber of Commerce in Uzbekistan Certificate of Conformity Psycho sanitary certificate Health certificate issued by Ministry of Health, Government of Uzbekistan

Guvohnoma for the company

6.4 INVENTORY The company keeps raw materials (first aid kit bags and its items, medicines) and finished first aid kits in its inventory. So, the warehouse should be furnished and organized in an appropriate manner that is optimal for keeping drugs and medicines. Average value in a stock is 10% raw materials and 10% finished goods. 6.5 SUPPLIERS Suppliers of raw materials and medicines #1 Name: Asklepiy Ltd. Address: Inventory: the supplier has enough inventories in all regions of Uzbekistan. #2 #3 Name: Ningbo Address: China, Guangou Inventory: Name: Sarbontextile JV Address: Inventory: Credit and delivery policies: Credit and delivery policies

Credit and Delivery policy:

Extra Plan: Alternative suppliers Costs: Steady and Fluctuating Bargaining power is available? 6.6 MANAGING CASH FLOW A company must be able to manage its short term cash flow. Before starting a business you must consider the following:

When you will get paid for the goods that you sell. When you must pay for goods that you sell. How much money you will lose if you don't get paid.

Managing cash flow for all new businesses is essential. How much time you will need to spend on this section of your business plan depends on how vulnerable your company is to liquidity problems. You can determine how vulnerable your company is by looking at:

The number of days between the date your company pays for goods sold and the date your company is paid for the goods sold. Your company's selling margin, or how much your company pays for the goods sold and how much your company receives for the goods sold. If your company has a low margin, then a high percentage of what should be collected from the customer will be paid to your suppliers whether your company gets paid or not. Your company's sales volume; the higher the volume the more spread out the risk will be. A company with a low sales volume will be severely impacted by not getting paid.

Managing Cash Inflows (Receivables) If you plan on selling goods or services on credit, you must address the following:

List the policies you will have about who gets credit and how much? Describe how you will check the creditworthiness of new applicants? List the terms you will offer your customers; that is, how much credit and when payment is due? The procedures for insuring payment. Are signed purchase orders required? Will your company mail monthly statements? The procedures for dealing with slow paying customers. Who in your Company will call slow paying customers? How may days past due must the customer be before a phone call is made? How past due before a collection letter is sent? How past due before you get your attorney involved?

Managing Cash Outflows (Payables) Will your suppliers offer you credit and if so how much and what are the terms?

AllSport
Assumptions: Days Outstanding

Health

Club

Balance Account

Sheet Income Statement Account

Days 30 30 30

Percentage Cash 10.00 % 0.00 % 0.00 % 0.00 %

Accounts Receivable Gross Sales Prepaid Expenses Accounts Payable Accounts Payable Rent Advertising

Legal and Accounting 45

7.0 MANAGEMENT AND ORGANIZATION The management team works in the territory of production area. The Administrative workers perform the following functions: Organization and Control of production, sales, distribution, service. Quality Control of First Aid Kits Identification and monitoring of sales strategies Maintaining, recording and saving the documents of the company Making sales contracts, finding new sources of customers

The ordinary workers perform day-to-day activities of production: Loading, unloading, storing

Processing: wrapping, racking, packaging and Delivering, after sales services Call centre activities

7.1 MANAGEMENT TEAM 7.1.1 ADMINISTRATIVE STAFF

1. Director of the Company/CEO

Duties: Coordination and control Monitoring the inventory level, stocks, warehouse, availability of all items, medicines, etc. Identifies the performance of the company, level of sales and distribution 2. Production Director/COO Duties: Organization and supervising production process Monitoring quality of products Managing stock of raw materials Responsible for daily production Planning work shifts Provide convenient condition for employees Training employees

3. Marketing manager Duties: Preparing advertising and sales promotion plans Maintains the control of implementing promotional plans Market research including finding new targets, customers Research and development activities Works with advertising agencies and responsible for the obligations and performing of contractual agreements of advertising agencies Prepare monthly reports about: Implementation and effectiveness of the promotional plans Necessary adjustments to the plan moving Financial reports on the costs of Promotional activities 4. Manager of FEA

Duties: Preparing and registering contracts about supply of raw materials Logistic activities including:

Monitoring, analysis and coordination of tovarodvijenie

Tracking the stock of raw materials and goods at the warehouse, calculation of stock taking into account shipment Dealing with cargo delivery Working with transportation companies Custom clearance and certification of raw materials Control of production and availability of supporting documentations Control and perform providing an application for certification in accordance with established rules and submitting them to the Authority for certification

Supervise the process of passage of applications and getting

certification Control for documents in the certification bodies, getting registered certificates of conformity Providing applications for raw materials, taking into account 20% stock value Reporting to CEO on weekly or monthly 5. Sales Director Duties:

Identifying the sales strategies Preparing action plan and monitoring sales activies Distribution of products Analysis of sales data and forecasting Analysis of weekly and monthly sales and reporting to the CEO

6. Accountant Duties: Bookkeeping of assets, liabilities and business operations (accounting for fixed assets, inventory, property, sales costs, the results of economic-financial activity, payments to suppliers and customers, etc.);

calculation and transfer of taxes and charges in state and local budgets, insurance premiums, social funds, payments banking institutions, employee wages;

Responsible for the timely and qualitative preparation of documents regarding the financial statements of the company and oversees their representation in public institutions, respectively, the current legislation of Uzbekistan;

Performs work to build, maintain and preserve the database of accounting information (in paper and electronic records). Responsible for the accounting profitability of the company

7.1.2 PRODUCTION STAFF 1. Production Manager Duties: Duties: Wrapping; Racking; Loading and Unloading; Storing, etc.; 3. Workers for delivering and setting up First Aid Kits to organizations Duties: Delivering FAK to organizations; Setting up FAK; Supervising production process; Reporting to Production director; Training and teaching production workers;

2. Production workers for 4 types of First Aid Kits

Department

Position

Schedule

Wage

Quanti ty

Total UZS Su'm US Dollar

Director

1 1

Company Director/CEO Production Director Supervisor Worker Chief FEA Custom Agent Sales Director Expeditor Marketing Manager Chief Accountant Assistant of Accountant Lawyer Assistant of Lawyer HR Manager Driver Cleaner Service Agent Security System Administrator Call Assistant Front Desk

Production

2 3 1

Purchasing 2 1 Sales 2 Marketing Accounting 2 1 Lawyer 2 HR 1 2 3 4 Administrati on 5 6 7 8 1 1

8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.3018.00 8.00-8.00 8.3018.00 8.3018.00 8.3018.00

1,000,000 650,000 500,000 150,000 650,000 300,000 650,000 300,000 500,000 600,000 250,000 600,000 250,000 500,000 150,000 80,000 150,000 200,000 200,000 200,000 150,000

1 1 3 20 1 1 1 2 1 1 1 1 1 1 10 1 10 3 1 2 1 64

1,000,000 650,000 1,500,000 3,000,000 650,000 300,000 650,000 600,000 500,000 600,000 250,000 600,000 250,000 500,000 1,500,000 80,000 1,500,000 600,000 200,000 400,000 150,000 UZS 15,480,000

$666.67 $433.33 $1,000.00 $2,000.00 $433.33 $200.00 $433.33 $400.00 $333.33 $400.00 $166.67 $400.00 $166.67 $333.33 $1,000.00 $53.33 $1,000.00 $400.00 $133.33 $266.67 $100.00 $10,320. 00

TOTAL

Company Director/CEO

Marketing Manager

Chief Accountant

Production Director

Lawyer

HR Manager

Sales Director

Chief FEA

Administration

Assistant of Accountant

Supervisor

Assistant of Lawyer

Expeditor

Custom Agent

Workers

System Admin

Front Desk

Call Assistant

Security

Service Agent

Cleaner

Driver

7.2 PERSONNEL Training methods and requirements Training of operations workers will be carried out by the Production director and Production managers at the beginning of production during one week. [Starts December 15th 2009]; In every hiring new employees production managers will train during one week. Moreover, in 6 month production director with the help of production managers will carry out training with whole employees. You should include a pay schedule for either the first 12 months or yearly for the first few years. You do not need to include the names of each employee and you may want to just use a payroll by department schedule such as the schedule below.

AllSport Payroll Fiscal Years Ending: Dec-31 2005 Administration Sales Total $30,600 143,277

Health by

Club Department

2006 $36,660 168,597

2007 $38,720 192,187

2008 $40,720 218,628

$173,877 $205,257 $230,907 $259,348

7.3 Reward strategy The reward strategy should reflect the companys business strategy. Good reward strategy increases the productivity of workers, which in its turn helps to achieve company objectives and missions. Pay structure It is important to know what the company wants to reward people. Coming from the companys objective which is to achieve targeted plan, it can be clear

that the company should reward those employees who are helping to bring and bringing profit for the company. First Aid Kit typically uses combination of payment: paying for the job with paying for individual [administrative workers] performance related pay [production workers]

So, administrative workers get fixed salary and some commission from profit. Production workers salary and commission depends on how many first aid kits they have produced and whether they achieved targeted plan/quantity. Monetary reward Administrative: Profit sharing Medical insurance 0, 01 % from monthly sales profit if monthly target is achieved. Every employee will get yearly medical insurance from Ingo-Uzbekistan insurance company Production workers:

Bonus schemes [20 000 thousand sum reward]

Non-monetary reward Recognition [best worker of the month] Cafeteria

8.0 FINANCIAL PLAN 8.1 Assumptions Any assumed costs 8.2 Break-even analysis

A break-even analysis predicts the sales volume at a given price required to recover total costs. The breakeven is the point where the Net Margin equals the Total Fixed Costs. The breakeven point is the number of units sold. To calculate the breakeven you must pick a time period (either a typical year or month), separate fixed costs (i.e. rent, insurance, wages and salaries that are not based on sales, interest expense, etc.) from the variable costs (cost of goods sold, commissions, etc.) and total the units sold. Then calculate the Net Margin by subtracting the variable expenses from the Gross Sales. Calculate the Net Margin per Unit Sold by dividing the Units Sold into the Net Margin. You calculate the breakeven by dividing the Total Fixed costs by the Net Margin per Unit. AllSport Health Club Break Even Analysis

Year Ending Dec. 31, 2007

Gross Sales Variable Expenses: Cost of Goods Sold Commissions Less Total Variable Expenses Net Margin Units Sold $24,704 $13,937

$369,980

$38,641 $331,339 8,287

Net Margin Per Unit Sold Total Fixed Expenses Breakeven

$39.98 $459,772 11,500

8.3 Projected Financial Statements 8.3.1 Yearly Income Statement All Income For the Fiscal Years Ending Dec. 31, 2007 - Dec. 31, 2011 2007 Sales Gross Sales Less Cost of Sales Net Sales $296,324 11,853 $284,471 $414,854 $647,172 $744,248 0 16,002 20,002 24,002 27,603 $519,30 $398,852 $623,170 $716,645 8 $539,31 2008 2009 2010 2011 Sport Health Club Statement

Expenses Advertising Auto Depreciation Dues & Subscriptions Interest Janitorial / Cleaning Licenses & Permits Payroll: Benefits Payroll: Employer Taxes Payroll: Salaries Payroll: Wages Printing & Reproduction Professional Fees Rent Repairs & Maintenance Travel & Entertainment

$37,774 1,200 26,125 300 15,448 1,200 300 24,000 38,400 120,000 72,000 1,200 1,800 48,000 1,200 3,000

$41,551 1,260 45,125 315 35,212 1,260 315 25,200 40,320 126,000 75,600 1,260 1,890 50,400 1,260 3,150

$43,629 1,323 59,375 331 32,416 1,323 331 26,460 42,336 132,300 79,380 1,323 1,985 52,920 1,323 3,308

$45,810 1,389 73,625 347 29,404 1,389 347 27,783 44,453 138,915 83,349 1,389 2,084 55,566 1,389 3,473

$48,101 1,459 87,875 365 26,157 1,459 365 29,172 46,675 145,861 87,516 1,459 2,188 58,344 1,459 3,647

Utilities: Gas & Electric 6,000 Utilities: Telephone 3,600 Total Expenses $401,547

6,300 3,780

6,615 6,946 7,293 3,969 4,167 4,376 $490,64 $460,198 $521,826 $553,770 6 $101,34 $162,87 4 5

Net Income (Loss)

($117,076 ($61,346 ) )

$28,662

8.3.2 Yearly Balance Sheet All Balance For the Fiscal Years Ending Dec. 31, 2007 - Dec. 31, 2011 2007 Assets Short-Term Assets Cash Accounts Receivable Merchandise Inventory Other Short-Term Assets Total Short-Term Assets 2008 2009 2010 2011 Sport Health Club Sheet

$544,226 0 1,200 0 $545,426

$293,247 0 1,333 0 $294,581

$193,496 0 1,667 0 $195,163

$177,725 0 2,000 0 $179,725

$234,586 0 2,300 0 $236,887

Long-Term Assets Fixed Assets $275,000 Less Accumulated 26,125 Depreciation Net Fixed Assets $248,875 Other Long-Term Assets 0 Total Long-Term Assets $248,875

$475,000 $625,000 $775,000 $925,000 71,250 130,625 204,250 292,125

$403,750 $494,375 $570,750 $632,875 0 0 0 0 $403,750 $494,375 $570,750 $632,875

Total Assets

$794,30 $698,33 $689,53 $750,47 $869,76 1 1 8 5 2

Liabilities Short-Term Liabilities Accounts Payable Other Short-Term Liabilities Total Short-Term Liabilities Long-Term Liabilities Loans Payable Other Long-Term Liabilities Total Long-Term Liabilities Total Liabilities

$33,204 0 $33,204

$34,589 0 $34,589

$35,939 0 $35,939

$37,350 0 $37,350

$38,825 0 $38,825

$485,773 $449,764 $410,959 $369,142 $324,078 0 0 0 0 0 $485,773 $449,764 $410,959 $369,142 $324,078 $518,977 $484,353 $446,898 $406,492 $362,903

Capital Owners Equity Retained Earnings Total Capital

$500,000 $500,000 $500,000 $500,000 $500,000 -224,676 -286,022 -257,360 -156,016 6,859 $275,324 $213,978 $242,640 $343,984 $506,859 $794,30 $698,33 $689,53 $750,47 $869,76 1 1 8 5 2

Total Liabilities and Capital

8.3.4 Yearly Cash Flow Statement All Cash Sport Flow 2007 2008 2009 ($117,076 ($61,346) $28,662 ) Health Club Statement 2010 2011

For the Fiscal Years Ending Dec. 31, 2007 - Dec. 31, 2011

Net Income

$101,344 $162,875

Operating Adjustments Depreciation (Increase) Decr. A/R (Increase) Decr. Inventory (Increase) Decr. Oth. S-T Assets (Decrease) Incr. A/P (Decrease) Incr. Oth. S-T Liabilities Total Operating Adjustments

$26,125 0 -1,200 0 33,204 0 $58,129

$45,125 0 -133 0 1,385 0 $46,377

$59,375 0 -333 0 1,350 0 $60,391

$73,625 0 -333 0 1,411 0 $74,702

$87,875 0 -300 0 1,474 0 $89,049

Net Cash from Operating Activities ($58,947) ($14,969) $89,054 Investing / Financing Activities (Purchase) Sale. Fixed Assets

$176,046 $251,925

($275,000 ($200,000 ($150,000 ($150,000 ($150,000 ) 0 -36,009 0 0 ($236,009 ) ) 0 -38,805 0 0 ($188,805 ) ) 0 -41,817 0 0 ($191,817 ) ) 0 -45,064 0 0 ($195,064 )

) (Increase) Decr. Other L-T Assets 0 (Payment) Issuance Loans 485,773 (Decrease) Incr. Other L-T Liabilities 0 Increase (Decr.) Owners Equity 0 Total Inv. / Fin. Activities $210,773

Net Change in Cash

$151,826

($250,978 )

($99,751) ($15,771) $56,861

Beginning Cash Ending Cash 8.3.5 Yearly Ratios All Ratios Sport

$392,400 $544,226 $293,247 $193,496 $177,725 $544,226 $293,247 $193,496 $177,725 $234,586

Health

Club

For the Fiscal Years Ending Dec. 31, 2007 - Dec. 31, 2011 200 201 201 Sales Growth Percent of Sales Net Sales Net Income 2007 2008 9 0 1 n.a. 29% 23% 17% 13%

96% 96% 96% 96% 96% (40% (15% 5% 16% 22% ) ) Total 69% 31% 4% 61% 63% 42% 58% 5% 64% 72% 28% 72% 5% 60% 73 24% 76% 5% 49% 27% 73% 4% 37%

Percent

of

Assets Short-term Assets Long-term Assets Short-term Liabilities Long-term Liabilities Owners Equity

Liquidity, Debt & Profitability Current Ratio 16.4 8.5 5.4 Quick Ratio 16.4 8.5 5.4 Debt to Equity Ratio 1.8 2.1 1.7 (15% (9% Return on Assets (ROA) 4% ) ) Efficiency Average Collection Period Days in Inventory

4.8 4.8 1.1 14 %

6.1 6.0 0.6 19 %

n.a. 30

n.a. n.a. n.a. n.a. 30 30 30 30

8.4 Additional Financial Reports At the following internet address: www.fast4cast.com/fc1/budget-samplereports.aspx you will be able to generate the following reports:

Loan Amortization Schedules by Loan Depreciation Schedule by Asset Income Statement Balance Sheet Cash Flow Statement Start-Up Expenses / Starting Balance Sheet Sales Schedule Payroll Schedule Payroll by Department Assumptions: Amounts derived from a Percentage an Account Assumptions: Amounts derived from the number of Employees Assumptions: Amounts derived from Days Outstanding Assumptions: Payroll Commissions Ratios

Or to view some of the more common reports simply click on any of the hyperlinks below:

Income Statement: Months 1 - 12 Balance Sheet: Months 1 - 12 Cash Flow Statement: Months 1 - 12 Ratios: Months 1 - 12 Income Statement: Months 13 - 24 Balance Sheet: Months 13 - 24 Cash Flow Statement: Months 13 - 24 Ratios: Months 13 - 24

9.0 APPENDICIES