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Traditional Chinese Medicine anno 2009

Traditional Chinese Medicine anno 2009. The concept. Creating customized pills with user-defined ingredients to be taken as the only daily food supplement. Two key features. Production. No stockpiling of customized wares .

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Traditional Chinese Medicine anno 2009

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  1. TraditionalChineseMedicine anno 2009

  2. The concept Creatingcustomizedpillswithuser-definedingredients to betaken as the onlydailyfood supplement.

  3. Twokey features

  4. Production • Nostockpiling of customizedwares. • Wekeep a library of TCM, whichare mixed to form the desiredproductone the customer has filed an order – muchlike is known from the concept of ”latebrewing”. CustomizedUser Product Genericlibrary

  5. Market analysis DefinetheScandinavian market: • Population: 25 millions • Demographics: 15 milion peopleattherangeof 15 – 74, estimates that 30-40% of population in the 15-74 agebracket use food supplements regularly and 60% occasionally. • HDP: $ 35 000 per capita • Politicalrectrictions: None • Otherfactors: strongecologicalandnature feeling

  6. Our competitors Finvita • Based in Finland, but operating on Scandinavia and UK markets • They offer more than 40 natural products, aminoacids, oily preparations and cosmetics, some of them from plants • They seem to be renowned on the market Dansk Droge • Based in Denmark , operating on all 3 markets just about to expand • In their portfolio have natural and ecological oils, pills, tablets, powder • Smaller than Finvita

  7. Comparison • Ourweaknesses • We are not firstmovers • Theyhavealreadysteadyclientele • Wehave no reputation • The market isreallycompetitive • Ourstrenghts • Innovative idea of connecting Chinese philosophywith customers needs is new on the market • Customerchooseswhat he wants • Weattackhuge segment ofthe market • TheInterest in Chineseornewwayofthinkingtends to increaseeveryyear • Weprovideoptionforthosewho do not believe in traditionalmedicine • No furtherresearchneeded • Itisafforadable

  8. How do we want to get customers • In order to target the big segment of the target we need to provide big portfolio in order to satisfy customers´ needs. • In order to succeed we need to have successful marketing campaigne • Advertise on THE INTERNET • Advertise on TV (quick effective shots) and radio • Advertise in specific magazines as fitness, women magazines, health… • Advertise as well as personal presentations in fitness centrums, cafe rooms, orient shops and restaurants, female meetings or waiting rooms at the doctors. Orders and payment will be taken by filling in on the internet, proceeded to the manufacturing centre and delivered to the customer through independent delivery service.

  9. What our competitors will do? • They can interfere their own marketing campaings • They can come up with something similar or broaden their portfolio • They can reduce the costs for the certain amount of time in order to get back control of the market • They will ask for cooperation (Dansk Droge maybe) • They will try to buy us (Finvita maybe) They will act upon our success during our marketing campaigne!

  10. patents • Thesemedicinesare not "patented" in the traditionalsense of the word. Noone has exclusiverights to the formula. Instead, "patent" refers to the standardization of the formula. All Chinese patent medicines of the same namewill have the same proportions of ingredients • Patents arescarce and extremelyspecific. It’sveryunlikelythattheywillinterferewithour business. • Example: Hair Tonic • U.S. Classification • 424/74; 424/195.1

  11. Law restrictions • Food supplements are food products, even though they may look like and beused in the same way as medicinal products. • Foodsupplementsincludeproducts for the intake of vitamins, minerals, fibre and fatty acids and variousherbal products. The ingredients used must not have medicinal effects and they must not have been approved for medicinal use. • The natural product business has categorized food supplements in thefollowingway: • Vitaminsandminerals • Products containing plants or plant extracts • Fibre and weight control products • Lecithin and fatty acid products • Algaeproducts • Beeproducts • Sportsnutrients • Otherfoodsupplements

  12. Lawrestriction-ii • Food Suppplements • Food Product • Vitamins in sufficientlylowconcentration • Administered by the ’Fødevaredirektorat’ • Demands: • Expiring dates • Componentson the label • Hygiene • NaturalMedicaments • Medicinal product • Governed by the ’Lægemiddelstyrelse’ • Demands • TCM libraryalreadyapproved • Productionorigins • Inspection af processing plant • Relaxeddemands for proof of effect

  13. Lawrestriction-iii FoodAct (23/2006) • Ministry of Trade and Industry Decree on Food Supplements (571/2003), based on the EU Directive on food supplements (2002/46/EC) o Ministry of Trade and Industry Degree 672/2007 on revision of Degree on Food Supplement 7§ (Given on 1st June 2007, in force on 1st August 2007) • Ministry of Agriculture and Forestry Decree on chargeable goods and services produced by the Finnish Food Safety Authority (296/2006) • Decree on Special Products 349/1989, repealed by Government Decree 570/2003

  14. Budget • Investment and cost: • Development cost EUR 2.000.000 • Purchase of ingredients for 3 years EUR 710.000 • Packages for 3 years EUR 50.000 • Logistics for 3 years EUR 80.000 • Marketing campaign EUR 600.000 • Salaries for 3 years EUR 450.000 • Business expenses for 3 years EUR 310.000 (FF approval, travelling, rent) Summary EUR 4.200.000

  15. How do we want to get money? • Business investors (from anywhere) • Business angels  • Banks • Our own money

  16. Sales forecast and returnment • If assumed we target 5 % of our segment within first three years (750.000 people buy our product at least once) • If assumed that price of basic package is EUR 25 (nett profit out of it EUR 5) • EUR 25 x 750.000 = EUR 18.750.000 (Gross profit) • EUR 5 x 750.000 = EUR 3.750.000 (Nett profit) • How many do we need to sell to return our investment if assumed that 20 EUR per package?This is a competitiveprice. 210.000 for 3 years….70 000 packages per year!

  17. What are therisks on theway to oursuccess? • Lasting or even deepening of the economy crisis (we would need to wait for some indicators at first e.g. Stock exchange rates) • Loss of key ingredient suppliers in China, India… • Extremely high price for petrol (probably not in next 3 years) • Some authority restrictions on our market(probably not) • Embargo on our supplier country (can happen) • Exchange rate EUR x Jian, Ruppia… • Unsufficient marketing campaign

  18. Our future vision • To expand to othercountries • Whenourresumeispubliclyknownandwehave money wecanbuysmallcompetitors • Wecanbuildrelationshipswithourcustomerandpublishbooks, picturesaboutChineseculture • To havefunandbuy a house in Bahamasandinviteeveryonefrominnovationcoursefor a party

  19. A food business actor who manufactures a food supplement or commissionsits manufacture or imports a food supplement must submit a writtennotification of the food supplement to the Food Safety Authority when startingoperations. • A notification is also required if the characteristic ingredients in theproduct’s composition change or if the product is withdrawn from the market. • The Food Safety Authority considers the notification requirement fulfilled whenthe notification is received by the Authority including appendix and all informationrequired.

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