1. FUTURE TRENDS Industry Consolidation Will Accelerate Manufacturers, Distributors & Wholesalers Big Will Get MUCH Bigger or Get Out Small Must Focus on Niche Segments Biggest Future Threat Likely NOT in the Industry Today Technology Will Dramatically Increase Both Speed & Efficiency but Require Significant Investment

2. ROLE REVERSALS Manufacturers Becoming Wholesalers Wholesalers Becoming Distributors Wholesalers Becoming Brokers

3. ROLE REVERSALS BENETIT Increased Understanding of Each Other’s Key Business Issues CHALLENGE Greater Transparency of Program/Profit Dynamics

4. “BOUTIQUE” vs “CAFETERIA” Define Future Role / Function of Jan-San Wholesaler Selective Line “Boutique” or Comprehensive “Cafeteria” Consistent Strategy or Line-by-Line Approach Examples From Other Industries With Deep Wholesaler Penetration ie. Grocery, Drug, Office Products

5. “BOUTIQUE” • Exclusive Lines in Many Key Jan-San Areas • Space Constraints Are Real • Product / Application Redundancies • Line Access / Selective Distribution Determines Point of Purchase

6. “BOUTIQUE” EXAMPLES • Rubbermaid or Continental • GoJo or Sani-Fresh • Etorre or Unger • Time Mist or Technical Concepts

7. “CAFETERIA” EXAMPLES • Dawn, Joy, Palmolive & Sunlight • Tide, Ajax & All • Dial, Safegaurd, Softsoap & Lever 2000 • Lysol & Clorox Spray • Fantastic, Formula 409 & Simple Green • Easy Off & Mr. Muscle

8. CLARIFY ROLES Manufacturer, Rep, Wholesaler REQUIREMENT: Reduce / Eliminate Duplication Throughout the Channel • Warehouses • Customer Service Functions • Sales / Tele-Sales • Distributor Marketing • Promotional Programs

9. CLARIFY ROLES Manufacturer, Rep, Wholesaler REQUIREMENT: Identify Most Efficient/ Effective Way to “Create” New Business • Lowest Cost - Identify “True” Costs • Highest Impact / Leverage • Accountability For Sales Performance

10. RE-DISTRIBUTION DATA • Basic Requirement For Expanded Wholesaler Role • Security of data – potential loss of control • Prudent measures that can be taken • Extension of Factory Field Warehouses/ Order Processing Systems • Accurate confirmation of orders shipped • Today’s speed will always be unacceptable • Technology investments required for process automation

11. FUTURE THREATS • Biggest Bundle Wins • Yesterday’s “giant” is tomorrow’s midget • Logistics will rule – TURNS! • Access to lines will NOT be a barrier • Technology Investments • Requirements continue to grow • “Virtual” extension of the factory • “Transparent” information/costs

12. FUTURE THREATS • Low Barrier to Entry – Warehouses • Services Required vs current model • Consolidation & Delivery • Costs vs Value Added – Marketing, Sales, etc • Need to have vs Nice to have (ie. catalogs) • Capital Requirements • Inventory investment • Technology • Margin Requirements

13. FUTURE THREATS • National Coverage • Seamless Operation • Ownership vs group membership

14. SOURCES OF REVENUE ASSUMPTION: Margin “Squeeze” Will Continue To Grow • Sales Costs / Broker Commissions • End-User Bids • End-User Drop Shipments (3PL) • Distributor Data – beyond the “basics” • “Dual House” Model

15. MINIMUM ADVERSTISED PRICE (MAP) POLICY • Component of Advertising Program NOT Price Control • Pricing Decisions Controlled by the Wholesaler NOT the Manufacturer • Does NOT Impede Price Negotiations With Key Distributors • Does NOT Guarantee Wholesaler’s Net Margin

16. MINIMUM ADVERSTISED PRICE (MAP) POLICY • Prevents “Death by Fax Machine” • Preserves the Price Equity of Key Products in Trade Advertising • Compliance is “Policed” by Wholesalers • Used Frequently Outside of Jan/San Industry