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Your Solutions Group & Your Corporation You r So l u ti o n s G ro up YourCorporation Address 1 Address 2 Tel. 1 Tel. 2 Email 1 Email 2 Web 1 Web 2 Preliminary Proposal and Marketing Plan Marketing Consultant For New Nutritional Bar Recipe / Formulation Best Opportunity for Business Development Strategy in Marketing and Sales OCTOBER 9, 2006 Table of Contents Page Introduction .....................................................................................................3 1 The Team .................................................................................................5 1.1 Your Corporation (Your Corp.) .....................................................5 1.2 Your Solutions Group Corporation (YSG) ....................................6 1.3 Primary Responsibility for Engineering Marketing Analysis..........6 2 Scope of Services ....................................................................................6 2.1 Phase I .........................................................................................7 3 Assumptions.............................................................................................9 4 Contingencies ..........................................................................................9 5 Time For Execution ............................................................................... 10 6 Fees For The Project ............................................................................ 11 7 Additional Services Available ................................................................ 11 8 Responsibilities of the Client ................................................................. 12 9 Changes To Project Scope ................................................................... 12 10 Secrecy Undertakings ............................................................... 13 11 Termination Of The Work.......................................................... 14 2 Introduction Marketing Consultant Expert in Food Products - eWork Markets ID 00000 The current situation you describe in your Request For Proposal (RFP) is the need for consultants with executive level experience to assist you in the launch of an aggressive, proactive marketing and business development activity for introducing a new date powder recipe into the market. You state a need to investigate selling your recipe in the form of nutritional or meal replacement bars and as coating for nuts or other food stuff. As entrepreneur, your responsibility is to evaluate the viability of the business and perform market research to help you assess the potential of the concept. Included with the aforementioned, is an analysis of the competitive situation, preparation of initial revenue projections and establishment of what is generally known as financial metrics for the business; these include your minimum attractive rate of return (MARR) and the actual after- taxes rate of return (ROR) for the business start-up venture. Apart from traditional marketing strategies your concept, undoubtedly, needs FDA Approval here in the U.S. or some other agency approval abroad. Your interest, it appears to us, is to perform a Market Analysis of the larger consumer, commercial, national and global markets for your product and see how your business could be properly positioned. Your product represents a food recipe, formulation or compound with presumably already approved constituents which should easily obtain approval from the FDA. Your concept represents a sealed food product for the Consumer Staples Sector, positioning could be somewhere in the Food & Staples Retailing Industry Group and more specifically in the Food Products Industry. You will invariably need a review of the Code of Federal Regulations (CFR) for your company’s particular product area to ensure achievement of complete compliance with applicable FDA or Canadian regulations. As you may probably know, U.S. industry is regulated by the CFR for various areas such as: food, cosmetics and medicines are regulated by the Food and Drug Administration (FDA), the power utilities and other industries are regulated by the Environmental Protection Agency (EPA), and the telecommunications industry is regulated by the Federal Communications Commission (FCC), among many others, and all these agencies have their rules codified in the CFR. YSG and Your Corp. are experts in code review and procedural application for marketing of various products. Your Solutions Group (YSG) partners from time to time with other consultants whose specialty is different from or expands on theirs. For this task, YSG will be partnering with Your Corporation. Your Corporation will have the principle responsibility of implementing this project. From the onset, it appears that your competitors might be companies like Met-RX, Power Bar, Balance Bar, Clif Bar, and Granola Bar. Some of these companies have many millions of dollars in annual revenues domestically derived from sales of food products and many have aggressive expansion goals to supply thousands of stores nationally and globally. One of these business models might be just right for your project goals but the fact is that successful business models change, adapt and are niche specific. YSG / YOUR CORP will provide your company with non- reactive broad scope and in-depth knowledge of the market so you can take the practical first steps, well informed. Perhaps a specialty label is advantageous to your company image and goals or perhaps selling your product to a supermarket chain for re-labeling is more lucrative. 3 We hope the following preliminary proposal will describe in as much detail as is possible at this point, on how to accomplish your project goals. Please note that Section 5 Contingencies, may not apply to your particular project at this time but we don’t know enough about it yet to omit the information and it may be useful to you in the future. We like our prospective clients to be well informed and to consider us in their future plans. Your Corporation administrates engineering, regulatory compliance, product marketing, patent process, and environmental consulting services to several sectors of the economy including the manufacturing, chemical process and pharmaceutical industries. The corporation sub-contracts additional professional personnel licensed to offer such services, whenever necessary. The branch which deals with environmental solutions is Your Corporation – Environmental Consultants. Business solutions include full Marketing Analysis / Research / Plans and complete Business Plans for start-up ventures. Marketing analysis for our client’s products profile the latest technology and products developed by competing manufacturing companies world-wide, as also existing patents, trademarks and trade names, the market share in certain product categories, production facilities, distribution channels, existing networks of suppliers and contractors, a description of work under development, earnings and losses statements and an evaluation of the competition. Your Corp. will engage in data mining for the client of all the major companies manufacturing similar products to your business interests and will develop a detailed marketing analysis and plan for your product based on this knowledge. The best manufacturing prospect will be identified as a model to follow and the remainders will be ranked in order of importance to your product and areas of distribution. The Marketing Plan is yours to use or to sell to prospective investors of your product. Reviewers should feel that your product is a natural extension of their already well established product lines, they should also believe that your product closes a production loop or product line. At Your Corp., we believe there is a proven strategy for marketing products effectively and profitably. If all you need is a regulatory review, we can help with this aspect exclusively. Please refer to the Scope of Work of this proposal if there are any doubts about our strategies. Our competitors sometimes charge up to three times as much as we do for similar research, however, we have ready access to a large databank and our overhead is generally lower. Please visit us at our website, www.Yourcorp.com 4 Chapter 1 Marketing Consultant For New Nutritional Bar Recipe / Formulation Best Opportunity for Business Development Strategy in Marketing and Sales 1 The Team 1.1 Your Corporation (Your Corp.) Patent Development Consultants, Engineering Consultants, Regulatory Compliance Consultants and Marketing and Business Consultants. Your Corp. specializes in patent feasibility, regulatory compliance and development of products and inventions of varying significance. Engineering specialties are in chemical, electronics, mechanical and environmental. In business, our marketing focus necessarily combines the systematic penetration approach and the flirtatious capture approach. Business solutions include full metrics and financial statements with the goal of partnering with Venture Capitalists (VC) and Angel Investors (AI) from sources domestic, foreign, institutional or private. Your Corp. provides its clients with access to: More Than 50 Domestic Private Venture Capital (VC) Funds Several Hundred Angel Investors (AI) More Than 100 Federal And State Money Programs Over 50 Micro-Enterprise Loan Sources Over 50 Small Business Loan Sources Over 200 Small Business Investment Companies, And More Than 50 Unconventional Loan Programs 5 1.2 Your Solutions Group Corporation (YSG) Information System Consultant, Project Management, Validation Consultant and Manufacturing solutions consultants for the Pharmaceutical Industry. YSG provides a full range of Technology, Business Process Re-engineering, ERP System Implementation Assistance, Project Management, Manufacturing Process Automation Laboratory Systems, Compliance services and Engineering services in both the business management and manufacturing space. 1.3 Primary Responsibility for Engineering Study and Marketing Analysis YSG staff will partner with Your Corporation to meet this project’s goals and will have limited input. However, contract coordination will be made through YSG since they are a Certified Affiliate of eWork Markets. Your Corporation will be responsible to provide the elements described in the Scope of Work for this proposal under a separate agreement with YSG. Chapter 2 Marketing Consultant For New Nutritional Bar Recipe / Formulation Best Opportunity for Business Development Strategy in Marketing and Sales 2 Scope of Services We would necessarily require further information as to the scope of your request, and the specific product, but for now we can outline the basic concepts which will be more fully developed if we are awarded the project. We envision a two phase implementation of strategy to introduce your product to the market: 6 2.1 Phase I 2.1.1. Records Review and Reconnaissance YSG / YOUR CORP has direct access to sources of marketing information within several Market Sectors, Industry Groups and specific industries. This information summarizes the latest technology and products developed by the major companies in the Sector world-wide, as also existing patents, trademarks and trade names held by the companies, the market share in certain product categories, location of facilities, distribution channels, existing networks of suppliers and contractors, a description of work under development, earnings and losses statements and an evaluation of their competition. YSG / YOUR CORP will engage in data mining for the CLIENT of all the major domestic companies in the industry having similar products to your business and will develop a detailed marketing plan for your product based on this knowledge. The best prospect to be imitated or followed and later overtaken within the market will be identified and the remainders will be ranked in order of importance to your product. 2.1.2. YSG / YOUR CORP will conduct a full regulatory review of the CLIENT’s product. This review will be done according to the specific agency rules that apply to the particular product being marketed. PLEASE NOTE: In some instances it may be necessary for the CLIENT to pay certain application fees associated with exhibition fees, permits or government review procedures, once an application is submitted. All of the specific regulatory aspects will be previously identified for the CLIENT along with any waivers or exemptions which may apply for your company’s particular project. 2.1.3. Product liability and insurance costs will be evaluated and summarized. 2.1.4. In addition to government rules, there may be industry specific standards which apply to products sold or services rendered in the United States. Certain industries are more dependent on these standards, industry practices, norms and specifications, than others. Depending on your particular business you may need to follow methods or specifications from institutions such as ASTM, ANSI, ASME, AICHE, IEEE, UL, NFPA, etc. YSG / YOUR CORP will conduct a full specification review of the CLIENT’s product. 2.1.5. The reports in Sections 2.1.1, 2.1.2, 2.1.3 and 2.1.4 will be forwarded to the CLIENT and constitute the results of the Data Mining and Reconnaissance task. 2.1.6. Evaluation and Report Preparation YSG / YOUR CORP will prepare for the CLIENT a Marketing Plan which will be exclusively developed and tailored according to the criteria of the chosen major company identified in 2.1.1 and on the basis of how well your product conforms to the established rules, norms, selection criteria, required manufacturing facilities and existing similar product lines of the selected major company. Any review of the Marketing Plan should convey that your product is a natural extension of an already well established product line or that your business closes a product loop or product line. 7 The Marketing Plan prepared by YSG / YOUR CORP will contain the following: Introduction Objectives Market Assessment Existing Product Categories Major Business Segments and Revenues Product Placement or Opening in Product Line Marketing Scenarios and Cost Structures Optimum Production Quotas Costs Associated With Variable Production Suggested Retail Price Computation Product Placement into Existing Channels of Distribution Implementation Strategy and Tactics Target Markets Geographic Areas Most Likely to Encompass the Target Market Primary Outlets Secondary Outlets Typical Consumer Dissemination of Product Attributes Positioning Pricing Structure Accessories, Parts, and Size Categories Sales and Profit Objectives Further Product Development Time Required to Introduce the Product Internal Evaluation Warehousing Locations and Product Shelf Life Distribution Methods Advertising and Promotion Sensitivity Analysis Product Liability Assessment * Evaluation of Patent Strength * Evaluation of Trade Mark Registration and Copyrights * Royalty Rate Structures and Cash Sale Valuation * Contract Options * Some items may not be relevant to your particular product and could be omitted 2.1.7. YSG / YOUR CORP will recommend specific contingencies to initial rejection, develop some critical financial metrics, contact 25 companies world wide about your invention or product and present photos and promotional write-up. 2.1.8. YSG / YOUR CORP will prepare a brief MS Power Point presentation of the salient points of the Final Report. 2.1.9. If specifically requested by CLIENT, follow-ups and continuing contacts via promotional material and presentation letters on CLIENTS behalf, beyond those included in Section 2.1.6, including a brief updated Market Research Report, will be billed at the following rates: $500 / 200 campaign material packets forwarded and $300 / 75 campaign material packets forwarded. This task can also be broken down by hours of multi-media marketing and advertising exposure. It is recommended that 8 this option be exercised every quarter to keep your business abreast of changes in the industry. 2.2. Phase II 2.2.1. Under this task, YSG / YOUR CORP will prepare for the CLIENT a complete Business Plan for your product(s) once more information is known. 2.2.2. Marketing media (i.e.: newspapers, trade magazines, radio, TV. Internet, etc.) advertising recommendations and contacts will be established. Logo, design graphics and brand establishment will be conducted. Application for Trademark Registration will be made if necessary. 2.2.3. YSG / YOUR CORP will provide CLIENT with checklists for maintaining and monitoring your Marketing Plan as established in Phase I. 2.2.4. YSG / YOUR CORP will prepare for the CLIENT business recommendations and strategies for obtaining funding for your business and will present the developed Business Plan to at least ten (10) venture capitalists and/or angel investors specializing in CLIENT’S business concepts. 3 Assumptions YSG / YOUR CORP assumes and shall be held harmless, that the product does not need any further development. YSG / YOUR CORP assumes and shall be held harmless, that there are no significant safety issues related to the product. YSG / YOUR CORP assumes and shall be held harmless, that all filing fees and application fees will be paid by CLIENT as may become necessary and are in addition to any sum quoted on this proposal. YSG / YOUR CORP assumes that CLIENT is somewhat familiar with U.S. Patent Law and is aware that in no way is YSG / YOUR CORP or any of its employees, associates and collaborators allowed to solicit, negotiate or participate as co-inventors of anything the CLIENT is presenting at this time for evaluation and marketing. YSG / YOUR CORP assumes that the owner understands that a complete Business Plan to be presented to Venture Capitalists (VC) and Angel Investors (AI) could be developed under Phase II at the associated costs. 4 Contingencies As with all utility patents the owner of the intellectual property has four basic alternatives as to disposition. The first, and the most desirable, is to sell or license exclusively your patent to a major manufacturer. This is called patent assignment by the USPTO, and must be notified under certain circumstances. Arguably, the next favorable alternative, is to license your patent non-exclusively to any of several manufacturers. Again this is known as assigning your patent and certain federal requirements also apply. 9 After that, the 17 or 20 year monopoly granted by the government or governments, depending on where you have filed, allows you to manufacture and sell your own patented product. This however, requires a considerable business investment. At this juncture, certain undesirable issues gain importance, such as: product liability, patent infringement by the competition, legal costs, insurance costs, manufacturing, distribution, advertising and everything else usually associated with a business. If demonstrable value to industry can be established, then promoting your invention or product to an industry standard such as ANSI, IEEE, or ASTM would provide enormous prestige to the owners and could almost certainly translate into greater sales. Finally, the last alternative but not necessarily the worst is to just sit on your patent and wait for someone to infringe your rights and then take them to court for a settlement or a judgment. This is risky, because it may never happen and because not all judges agree with monopolizing technology, and the latest Microsoft court case in relation to Media Players is a good case in point. Nevertheless, hardship to the small inventor carries considerable weight under the law, and some relief by way of injunctions and compensation for punitive damages have been awarded. By way of a concluding remark to this section, a last ditch effort could be made to entice a major manufacturer to buy your patents just so that they are guaranteed that your discoveries will not be there to interfere with something they are already planning to take to market in a few years. If enough probable interest is generated by assorted companies both large and small, this is a good enough leverage to threaten a larger company’s future campaigns. They are sometimes forced to buy out the competition. If international filing of your patents has not occurred we can assist you. YSG / YOUR CORP can assist you in all of these aspects. 5 Time For Execution YSG / YOUR CORP shall work with the CLIENT a reasonable schedule in accordance with the needs of the CLIENT. It has been indicated that the project start date is 10/11/2006, however, the Records Review and Reconnaissance will only start when a signed authorization to begin the project is received from the CLIENT. All agreements are to be coordinated with eWork Markets. Travel and Per Diem costs will be billed only for CLIENT authorized field trips outside of the normal working area, if necessary. An estimate of any required travel will be presented to the CLIENT in the Final Proposal, and 75% of the estimate is due before traveling. A Draft Report of each Phase and the Business Plan will be submitted to the CLIENT for review and comments, two weeks before submitting the Final Reports. Final Reports will be provided along with two copies for the CLIENT. The total time to complete the work is one (1) month, thirty (30) days for Phase I and an additional (1) month for Phase II, if this option is chosen. 10 6 Fees For The Project YSG / YOUR CORP shall receive, as compensation for the work included in PHASE I of the Scope of Work, the lump sum amount of TWO THOUSAND ONE HUNDRED TWENTY FIVE AND 00/100 DOLLARS ($2,125). This lump sum fee will be invoiced as follows: 45% with the Data Mining and Reconnaissance Reports 40% with the Draft Reports 15% with the Final Reports If, however, CLIENT chooses both Phase I and Phase II implementation, YSG / YOUR CORP shall receive, as compensation for the work included in the Scope of Work, the lump sum amount of FOUR THOUSAND TWO HUNDRED FORTY FIVE AND 00/100 DOLLARS ($4,245). The lump sum fee will be invoiced as follows: 30% with the Data Mining and Reconnaissance Reports 10% with the Phase I Draft Reports 10% with the Phase I Final Report 30% with the Phase II, Business Plan Draft Report 10% with the Phase II, Business Plan Final Report 10% with the Business Plan Contact / Presentations All quoted fees are subject to reasonable negotiation prior to project acceptance by CLIENT. 7 Additional Services Available Federal and State monies for your business Government contracts and grants : FDA, CDC, USAMRID, GSA, etc. Grants for small businesses to research and develop high-tech innovations Grants for small businesses and non-profit research partneners to research and develop high- tech innovations Federal Venture Capital (VC) money programs Venture Capital Clubs, Associations and Networking 11 Angel Investor Contacts Many of the fedral programs include yearly renewal for additional government funds. YSG / YOUR CORP shall receive the following fees, as compensation for on-going and continuous additional consulting services: Marketing and Business related activities: $45.00 - $55.00 per hour. Economic Analysis and Financial Metrics related activities: $55.00 - $65.00 per hour. Patent filing and maintenance related activities: $65.00 - $75.00 per hour. Engineering related activities (i.e.: feasiblity studies, designs, permits, constuction inspection, etc.) Schematic Detail Design Level: $75.00 per hour. Preliminary Detail Design Level: $85.00 per hour. Final Detail Design Level: $105.00 per hour. 8 Responsibilities of the Client The CLIENT shall be responsible for the following: Supplying YSG / YOUR CORP with all existing photos and promotional material or information necessary to market the product. Supplying YSG / YOUR CORP with any information about patent(s) and or Trade Marks in existence for the product and where they are registered, be it in the U.S., European Union, Asia, etc., anything which is already in the public domain. Indicating to YSG / YOUR CORP if there are any intentions to further develop the product, changes that may be made, or additionally associated patents which may be sought. Provide YSG / YOUR CORP any information about advertising and promotional goals. Corresponding through e-mail or other means with the consultant to fine tune strategies. 9 Changes To Project Scope YSG / YOUR CORP has prepared this work scope based on our understanding of CLIENT needs. The cost of doing the specific project described herein is based on similar work done previously. Any significant variation to the scope presented herein will be discussed with the CLIENT and additional funding requests will be prepared and submitted prior to starting any new work. No work will be done until receiving previous approval from the CLIENT authorized representative. 12 10 Secrecy Undertakings YSG / YOUR CORP shall agree to undertake that it will keep all the technical information disclosed by the CLIENT to YSG / YOUR CORP in strict confidence, and to use the same only for the preparation of the design of CLIENT’s Marketing Plan. YSG / YOUR CORP will sign any Non-Disclosure or Non-Compete Agreement (ND/NC) specified and required by the CLIENT. If not available, we can provide CLIENT with a generic version. The obligations of YSG / YOUR CORP mentioned above shall not apply to any of the following technical information, except if specifically contained in the ND / NC Agreement: That which is published or otherwise available to the public domain at the time or receipt thereof by YSG / YOUR CORP That which becomes published or otherwise available to the public domain after receipt thereof by YSG / YOUR CORP through no act or failure to act on the part of YSG / YOUR CORP All documents filed with government agencies become part of the public record. Similarly YSG / YOUR CORP requests that CLIENT maintain the contents of this proposal, including, all methods, procedures and strategies as confidential material due to competitive aspects of doing business. 13 11 Termination Of The Work The CLIENT may terminate the work at any time by giving YSG / YOUR CORP written notice of the termination of the work one (1) week in advance of the termination date. The CLIENT shall pay YSG / YOUR CORP the services performed and the reimbursable expenses due to the termination date. There shall be no penalty for termination of this agreement. All payments are to made to: Your Corporation P.O. Box 0000 Texas, TX 00000-0000. Contact with respect to this proposal should be made to: YSG at firstname.lastname@example.org, www.the- tx.com or Your@prtc.net, info@Yourcorp.com or through eWork Markets. The CLIENT may accept this proposal by signing and returning a copy of this document which becomes a part of the standard eWork Markets Business Consulting Agreement. A standard eWork Markets Business Consulting Agreement will be forwarded as soon as this document or some negotiated form of same, is accepted and agreed upon. Cordially, ______________________ ____________________ Your Name Their Name, President President Your Corporation Their Solutions Group ACCEPTED AND AGREED By: _____________________________________ Print Name: ______________________________ Date: ___________________________________ 14
"Marketing Consultant Expert in Food"