Business Plan (Richard Ivey) - Cerebration05

Index Topic

Pages

•

Executive Summary

2-7

•

Comprehensive Business Plan

7-26



Canada – Investment Climate

7



Canada as a TCM Market – Macrecnmic !nal"sis

7



T#e Canadian $%& Ind'str"

8



Canada as a TCM Market (r a $e) *ntrant

8



C#inese %er+al &rd'cts – Cmetitive *nvirnment

9



*ntr" trate."

9



/al'e /al'e &rsitin  &sitinin.

10



Marketin. trate."

10



Market e.mentatin  Tar.et Tar.et e.ment Identiicatin

11



Marketin. &lan

13



r.aniatinal &lan  Mana.ement tr'ct're

17



eratinal trate."

20



(inancial !nal"sis

24



'siness isks

26

1

Index Topic

Pages

•

Executive Summary

2-7

•

Comprehensive Business Plan

7-26



Canada – Investment Climate

7



Canada as a TCM Market – Macrecnmic !nal"sis

7



T#e Canadian $%& Ind'str"

8



Canada as a TCM Market (r a $e) *ntrant

8



C#inese %er+al &rd'cts – Cmetitive *nvirnment

9



*ntr" trate."

9



/al'e /al'e &rsitin  &sitinin.

10



Marketin. trate."

10



Market e.mentatin  Tar.et Tar.et e.ment Identiicatin

11



Marketin. &lan

13



r.aniatinal &lan  Mana.ement tr'ct're

17



eratinal trate."

20



(inancial !nal"sis

24



'siness isks

26

1

EEC!"#$E S!MMA%Y *CMM*$!TI$

e recmmend t#at ra.nCare td eand its trint t Canada t#r'.# a 'll" )ned s'+sidiar" +" t#e name  :ra.nCare Canada td;< !)areness  alternative #ealt# medicine is increasin. raidl" in Canada< T#e Canadian $at'ral %ealt# &rd'cts =$%&> ind'str" =Market ie? @2620 millin>1,  )#ic# t#e #er+al medicines #ave a 40A s#are =Market ie? @1048 millin>, is .r)in. at 20A ann'all"2< T#ee Tradi T# raditi tina nall C#ine C#inese se Medi Medici cine ne =TCM =TCM>> se.m se.ment ent in art artic ic'l 'lar ar is #i.#l #i.#l" " ra.mented )it# n maBr +rand in t#e marketlace< Market s#are  nne  t#e c'rrent la"ers eceeds 5A< In t#is resect, t#e market cnditin in Canada is similar t )#at eists in ra.nCares c'rrent markets and rvides ra.nCare a .d rt'nit" t create a nic#e r itsel +" +'ildin. a +rand n t#e stren.t#  its scientiic researc# caa+ilities and eerience  eratin. in s'c# markets<  DT T!T*EF

ra.nCare Canada s#'ld eml" a #ased arac# in intrd'cin. its rd'cts, its .e.ra#ic eansin in Canada and intrd'ctin  its 'll val'e rsitin t t#e Canadian c'stmers< 1

Trade (acilitatin ice Canada – &#armace'ticals and $at'ral %ealt# &rd'cts Market esearc# 2003< Canada 'siness ervice Centre )))
2

ra.nCare s#'ld enter Canada )it# t) atented )mens #ealt#care rd'cts reera+l" r n'tritinal +eneits  imm'nit" imm'nit" develment )#ic# #ave t#e #i.#est demand in Canada3< T#e strate." is t devel t#ese rd'cts as a s ra.nCares :(la.s#i; rd'cts in Canada< Intrd'ctin  t#er rd'cts )ill +e ater t#e :ra.nCare rand; is esta+lis#ed< ('rt#er, ra.nCare s#'ld initiall" limit itsel t ritis# Cl'm+ia and !l+erta since t#ese are t#e +i..est markets r TCM rd'cts =51A  ele in C  !l+erta 'se $%&s  TCM>4< C als #as a #i.# C#inese immi.rant 'latin =380,000 C#inese immi.rants i5, t#ere+" rvidin. an attractive eas"-t-ta market r ra.nCare< !ter 3 "ears  eratins in Canada, ra.nCare s#'ld intrd'ce services in t#e rm  TCM clinics, t#ere+" cmletin. its val'e rsitin< ra.ncare, )it# its limited res'rces s#'ld c's n .r)in. rimaril" in t#e Canadian market< %)ever, i a e) "ears d)n t#e rad, ra.nCare decides t enter t#e D market, it s#'ld cnsider settin. ' a man'act'rin. 'nit in Canada t take advanta.e  t#e $rt# !merican (ree Trade !.reement !.reement and 'se Canada as a man'act'rin. +ase r $rt# !merica< %)ever, )e d nt recmmend settin. ' a man'act'rin. 'nit in Canada t tar.et t#e Canadian market +eca'se  #i.#er risk assciated )it# #i.# initial investment and als +eca'se t#e rd'ctin csts are l)er in Mala"sia and in.are< &*!TI$E M*

ra.nCare Canada s#'ld s'rce rd'cts rm its man'act'rin. acilities in in.are and Mala"sia, and 'se Canadian #arma-rd'cts distri+'trs t reac# t#e #arma-retailers and 'ltimatel" t#e end 'sers<

M!G*T IH* !$!FI !$!FI  M!G*TI$E &!$ 3

$M!C< )))
3

Product

ra.nCare s#'ld enter t#e Canadian market )it# nl" t#e TCM rd'ct line since ra.nCare can dierentiate itsel +est n t#e +asis  its researc# and scientiic caa+ilities =)#ic# are mre alica+le t t#is line  atenta+le rd'cts> and +eca'se t#ere are mre rt'nities r market enetratin in t#is se.ment d'e t less cmetitin< ra.nCare s#'ld intrd'ce t) atented )mens #ealt#care #ealt#care rd'cts r n'tritinal +eneits  imm'nit" develment =55A  cns'mers 'se $%&s r t#is reasn>6< T#e rimar" reasn r t#is recmmendatin is t#at )men rm t#e +i..est TCM market se.ment7 =mens =mens %er+al Medicine Market ie? @ 535 millin< Er)t# ate? 20A>
e s'..est t#at ra.nCare adt a remi'm ricin. strate." =inline )it# its +rand ima.e> and rice its rd'cts at @32-@35+ttle @32 -@35+ttle =etail rice in Canadian @>
ra.nCare )ill 'se a m'lti-rn.ed arac# r esta+lis#in. its +rand< It )ill #ave a +'d.et  @2<5 millin r rmtins in 2006 and amil"riend reerrals =36A> as +ein. t inl'encers in +'"in. decisin r $%&s>9< !dvertisin.? Dsin. #ealt# ma.aines r )men, ca+le T/, T/, radi, ne)saer, +ill +ards, and internet< T#e c's  t#e advertisements )ill +e rd'ct +eneits, ra.nCares researc# la+s and in.are - a clean  r.ressive cit"< T#is arac# )ill #el +'ild cns'mer cnidence n t#e J'alit"  #ealt# rd'cts imrted t Canada< ales &rmtins? Incl'des ree samles, disc'nt c'ns, +'ndlin. rd'cts int val'e acks, and +'ndlin. ra.nCare .ds =ke" c#ains, cee m'.s etc>< In-tre &rmtins? Incl'des Trade isc'nts and secial In-tre camai.ns< 6

$M!C< )))
4

&'+lic elatins#is? Incl'des articiatin in Trade #)s, snsrs#i  scial ca'ses tar.eted at )men< irect Mail Camai.ns? T#ese camai.ns )ill +e 'sed r selectivel" reac#in. tential ln. term c'stmers< l.s? ra.nCare )ill als initiatearticiate in disc'ssins n #er+al rd'cts in +l. sites like )))<+l.scanada
T#ere are t#ree main distri+'tin c#annels r ra.n care in Canada? #ealt# d stres, #armacies and TCM ractitiners< ra.nCare )ill reac# t#e #ealt# d stres and #armacies t#r'.# strate.ic alliances )it# t) #arma-rd'ct distri+'trs =ne eac# in C and !l+erta>< nline sales are nt recmmended +ased n I calc'latins< (I$!$CI! !$!FI

=$te? !ll i.'res are in K000s E> DragonCare Canada Pvt Ltd Forecasted Income Statements Yearly Sales Growth upto 2010

75%

Sales Growth in 2010

35%

% of Sales 100% 6%

2005E 0.0 0.0

2006E 5000.0 300.0

2007E 8750.0 525.0

2008E 15312.5 918.8

2009E 26796.9 1607.8

2010E 36175.8 2170.5

Gross &ar'in (ransportation $ost SG# E)*(+#

94% 4% 80% 10%

0.0 0.0 800.0 )800.0

4700.0 200.0 5000.0 )500.0

8225.0 350.0 7000.0 875.0

14393.8 612.5 12250.0 1531.3

25189.1 1071.9 21437.5 2679.7

34005.2 1447.0 28940.6 3617.6

+epre,iation E)*(

4%

0.0 )800.0

200.0 )700.0

350.0 525.0

612.5 918.8

1071.9 1607.8

1447.0 2170.5

Sales $GS

*nterest 0.0 108.8 190.3 333.0 582.8 786.8 -)( " &inority *nterests )800.0 )808.8 334.7 585.7 1025.0 1383.7 &inority *nterests )153.6 )155.3 64.3 112.5 196.8 265.7 -)( )646.4 )653.5 270.4 473.2 828.2 1118.0 (a.es -aya/le on -rofit )245.6 )248.3 102.8 179.8 314.7 424.9 (a. $oer fro preious Year 0.0 245.6 494.0 391.2 211.4 0.0 #,tual (a.es -ai 0.0 0.0 0.0 0.0 103.4 424.9 (a. $oer $arrie er 245.6 494.0 391.2 211.4 0.0 0.0 -#( )400.8 )405.2 270.4 473.2 724.8 693.2 : 1 Sales are based $n *rag$ncare;s rice #$ re#ailers. e#ailer margins are ab$ve #his rice. 2 +i(ed ,sse#s *ear#men#al $ns$lida#i$n $& #he ?SS ,-++ 2005

Rear!s " #ssuptions

Sales !rice is ad"us#ed #$ acc$mm$da#e ar# $& #rans$r#a#i$n c$s#. '2.5 milli$n marke#ing e(ense in 2006 4% $& Sales based $n assum#i$n #ha# *ee( is 10% $& +i(ed ,sse#s -n#eres# a#e 7.5%. !rime /ending a#es $& $s# Singa$re anks is ar$und 5.5% 19.2% in. -n#eres#. +r$m 2004 a(es 38% anadian

5

Net Cash Flow Projections for Canadian Operations 2005E 2006E 2007E 2008E 2009E 2010 E et $ash low fro perations )646.40 )1117.17 122.65 610.19 964.48 1460.57 et $ash low in *nestents 0.00 )1450.00 )1087.50 )1903.13 )3330.47 )2719.88 $ash low fro inan,in' 0.00 1450.00 1087.50 1903.13 3330.47 2719.88 E( $#S4  )646.40 )1117.17 122.65 610.19 964.48 1460.57 $#e:ash &l$= in inves#men#s in &u#ure years =ill be l$= due #$ sl$=er average gr$=#h $& ar$und 5)10%. enceA cash &l$=s &r$m $era#i$ns in &u#ure years =ill be s#eady and su&&icien# #$ c$ver any &u#ure inves#men# reBuiremen#s Cr$=#h =ill sl$= d$=n because *rag$nare =$uld have c$mle#ed i#s ge$grahic and r$duc# line e(ansi$ns by end $& 2010.

&' Year %eturn on #nitial #nvestment( 14<43A =eer *#i+it 33 r details> )et Present $alue o* Project( 5<2 Millin E =eer *#i+its 32  33> #nitial #nvestment %e+uired( @2<1 millin in 2005-06< Pro*ita,le in -../0 7A  ra.nCare tds net rits in 2010 )ill +e rm Canadian

eratins< 14A  ra.nCare tds sales in 2010 )ill +e rm Canadian eratins< Positive cash *lows *rom operations in -../0 Brea1even Sales $olume( @ 5<3 millin"ear in 2006 =eer *#i+it 44 r details> Brea1even Mar1et Share( 4<2A =eer *#i+it 44 r details> #nterest Coverage %atio( %ealt#" =L 4 > eer *#i+it 40 r t#er ratis<

eer *#i+its 28 t 44 r rBected inancial statements =Canadian eratins and Cnslidated>, ratis, cas# l)s, sensitivities and ass'mtins< Source o* 2unds( ra.nCare td s#'ld sec're ln. term lans rm its c'rrent +ank in

in.are t 'nd caacit" eansin in its in.areMala"sian acilities and its )n ecess cas# r 'ndin. initial )rkin. caital reJ'irements< In later "ears t#e Canadian divisin can s'rce )rkin. caital reJ'irements rm Canadian +anks< %is1s( a> %i.# )rkin. caital reJ'irements in 't're "ears t meet .r)t#<

Miti.atin stes – 'l" c#ain eicienc" imrvement< +> (rei.n ec#an.e risks< isk level – Medi'm< Miti.atin tes – %ed.in.< E!$IH!TI$ &!$  M!$!E*M*$T TDCTD* DragonCare Canadas !ission Statement" :Carin. r %'manit" +" rvidin. t#e traditinal r'te t a #ealt#" lie<; #rgani$ation Structure"

Inline )it# t#e str'ct're  ra.nCares t#er s'+sidiaries, EM Canada )ill rert t /&-ales  etail< ince Marketin. )ill +e ra.nCare Canadas c's, t#e Marketin. Mana.er )ill rert directl" t EM Canada< !  Crdinatr )ill act as a link +et)een Canadian Evernment and ra.ncare tds  #eadJ'arters r matters re.ardin. certiicatin, rd'ct saet" etc< 6

C3MP%E4E)S#$E B!S#)ESS P5A) C!$!! – I $/*TM*$T CIM!T*

Canada is a d"namic and cmetitive ecnm" t#at #as li+eral and avra+le licies r esta+lis#in. ne) +'sinesses< Canadas strn. ecnmic 'ndamentals and relative cst advanta.es ver t#er develed natins rvide a irst rate +'siness envirnment< Canada led t#e E-7 c'ntries in terms  E& .r)t# =3<1A> in 2000-20036. and is eected t remain a t errmer in 2004-2006 =2<8A>< Canadian lcatins cmare )ell internatinall" in terms  stat'tr" crrate incme ta rates< (irms in Canada #ave .r)in. incme ta rate advanta.es ver D irms< *liminatin  caital ta is eected t increase t#e ta advanta.e ver D rm t#e c'rrent 2<3A t 3<4A +" 200866< Exhi,it 6 s'mmaries e)  t#e advanta.es  Canada as an investment

destinatin< Canada leads t#e E7 C'ntries in terms  J'alit"  lie =#i.#est inde val'e  9<2>, +'siness envirnment, la+r csts =l)est inde val'e  80> and cst  livin. =l)est inde val'e  60>< C!$!! ! ! TCM M!G*T – M!C *C$MIC ! $!FI

T#e &litical climate in Canada is )ell s'ited r investment< T#e +ilateral disc'ssins n t#e Canadian in.are (ree Trade !.reement are n.in. since 2001< T#e arval  C(T! )ill lead t t#e eliminatin  all tari and nn-tari meas'res +et)een Canada and in.are and mre eicient trade and c'stms rced'res< T#e Canadian ecnm" 10

G&ME Cmetitive !lternatives E7 2004 *diti n< Invest in Canada< )))
11

7

is n an 's)in. )it# l) 'neml"ment rates, l) interest rates, strn. dllar val'e, l) inlatin and #i.# dissa+le incmes res'ltin. in sitive cns'mer +e#avir< Increasin. #ealt# cnsci'sness and .r)in. a)areness  alternate #ealt#care rd'cts eseciall" TCM resents tremend's .r)t# rt'nities r C#inese #er+al rd'ct cmanies< ('rt#er, t#e resence  a lar.e C#inese immi.rant 'latin als adds t t#e attractiveness  Canada as a TCM market< %i.# cm'ter literac" #as led t )ide sread 'sa.e  internet makin. t#is an attractive advertisin. c#annel< %ence, rm a macr ecnmic ersective, Canada is a ver" attractive market r TCM rd'cts< eer Exhi,it - r t#e &litical, *cnmic, cial and Tec#nl.ical =&*T> !nal"sis< T%* $!TD! %*!T% &DCT =$%&> I$DTF I$ C!$!!

Canadians are +ecmin. increasin.l" )illin. t s#'lder resnsi+ilit" r t#eir )n #ealt#< it# t#is trend #as cme a ne) a)areness  #ealt# rd'cts, t#eraies and remedies derived rm ancient s'rces  kn)led.e s'c# as t#e Traditinal C#inese Medicines =TCM> #ave 'nd increasin. aeal in t#e cntemrar" Canadian ciet"6-< T#e Canadian $%& ind'str" is a E@ 2620 millin ind'str" .r)in. at 20A ann'all"< T#e +i..est markets r $%&s )it#in Canada are t#e estern Canadian rvinces  ritis# Cl'm+ia and !l+erta< men are t#e lar.est 'sers  $at'ral %ealt# &rd'cts =49A  Canadian men 'se $%&s> and a si.niicant ercenta.e  Canadians send ver E@ 39 mnt#l" n t#ese rd'cts< 55A  $%& cns'mers 'se t#ese rd'cts t devel imm'nit" and r n'tritinal +eneits< %e*er Exhi,its 7 to 8 n t#e Canadian )atural 4ealth Products Mar1et0 C!$!! ! ! TCM M!G*T ( ! $* *$T!$T

T#e TCM ind'str" =%er+al Medicine Market ie? @ 1048 millin> in Canada is #i.#l" ra.mented )it# several small la"ers v"in. r c'stmer attentin< T#e a+sence  dminant la"ers and maBr +rands =n la"er #as mre t#an 5A market s#are> in s'c# a raidl" .r)in. market and l) +arriers t entr", make Canada an attractive market r ra.nCare td< esite t#e t#reat  increased cmetitin rm ne) entrants, t#e Canadian TCM market rvides ra.nCare an attractive .r)t# aven'e )#ic# it can ta eectivel" +" actin. rmtl" and esta+lis#in. a strn. +rand earl" n t#e +asis  its J'alit", scientiicall" develed rd'cts and a..ressive marketin.<

12

%ealt# Canada< #tt?)))<#c-sc<.c
8

Exhi,it 9 s'mmaries t#e attractiveness  t#e Canadian TCM market rm t#e

ersective  a ne) entrant< C%I$** %*! &DCT M!G*T - CM&*TITI/* *$/I$M*$T

#ile t#e a+sence  a maBr +rand in t#e market is t ra.nCares advanta.e, it is )rt# takin. nte t#at t#ere are a lar.e n'm+er  small la"ers c'rrentl" in t#e market< Mst  t#ese are small cmaniesdistri+'trs =ales N @1 millin> t#at sell relativel" 'nrcessed rd'cts like .insen. rts, C#inese #er+s =*amle? 'm+' Cit" C#inese %er+s> etc< T#e +i..er la"ers are int sellin. mre val'e added rd'cts similar t ra.nCares TCM rd'ct line< #ile a si.niicant ercenta.e  t#e Canadian la"ers are tar.etin. t#eir rd'cts at t#e C#inese!sian immi.rant 'latin =t#eir n rills acka.in. )it# traditinal names and l) ricin. indicate t#is>, ver" e) la"ers are tar.etin. t#eir rd'cts seciicall" at t#e Canadians< ra.nCare can sitin itsel t +rid.e t#is .a and can devel its rd'cts and rmtins t seciicall" tar.et )esterners< T#e cmetitr t take nte  r ra.nCare is Gaiser &#armace'tical td, a Tai)anese cman", )#ic# c-rdinates its +'siness t#r'.# a sales ice in $rt# !merica< T#is cman" t #as a researc# riented c's and markets its rd'cts n t#e same +asis67< It erates in Canada t#r'.# t) distri+'trs =ne in /anc'ver, C and ne in innie., ntari> and #as made a .d name r its rd'cts in a s#rt time< %)ever, t#is cman" sells its rd'cts nl" t TCM &ractitiners =since it c'rrentl" c'ses n t#e D market, it des nt #ave t#e res'rces in Canada t take t#e retail r'te> and ra.nCare can avid direct cnlict )it# t#is cman" +" tin. r t#e retail r'te< ! e) t#er la"ers s'c# as %er+al Cmrt &rd'cts and ! rld  Ed %ealt# sell rd'cts 'sin. t#e nline c#annel6:< *$TF T!T*EF

e recmmend t#at ra.nCare td enter t#e Canadian market t#r'.# a )#ll" )ned s'+sidiar" )#ic# s'rces its rd'cts rm its man'act'rin. 'nits in in.are Mala"sia< ra.nCare td #as t#er aven'es  entr" int Canada - a Bint vent're =O/>, an acJ'isitin, a .reenield rBect =)it# a ne) man'act'rin. set ' in Canada> are a e) s'c# tins< #ile a Bint vent're and acJ'isitin ma" #el ra.nCare levera.e t#e 13 14

#tt?)))
9

kn)led.eres'rces  artnerseistin. la"ers, t#e a+sence  a lar.e la"er in t#e Canadian market )it# a .d it r ra.nCare n'lliies t#e tential +eneits t#at t#ese aven'es ma" #ave ered< ('rt#er, eval'atin. t#e tins +ased n t#e criteria  retainin. cntrl, maimiin. rits and minimiin. t#e risks  startin. a ne) +'siness in Canada, )e ind t#e tin  settin. ' a s'+sidiar" )it#'t an" man'act'rin. acilities in Canada as t#e +est alternative< Exhi,it 6. s#)s t#e *val'atin  t#e vari's *ntr" !ven'es availa+le t ra.nCare< !E$C!* C!$!! /!D* &&ITI$  !$ &ITI$I$E

ra.nCare Canada )ill seek t +ecme an end-t end TCM rvider t Canadian c'stmers< In rder t ac#ieve t#is .al it )ill #ave a 3-&rn.ed /al'e &rsitin – P'alit", %ealt# and ervices< ra.nCare Canadas /al'e rsitin )ill +e reresented +" t#e t#ree rn.s  t#e Canadian Male ea< Exhi,it 66 s#)s ra.nCares /al'e &rsitin Mdel< e +elieve t#at ra.nCare Canada can dierentiate itsel rm t#e c'rrent la"ers in t#e Canadian TCM Market n t#e +asis  t) main actrs – a> %i.# rand /al'e and +> cientiicall" esearc#ed  eveled &rd'cts< T#is )ill als all) ra.nCare t 'rs'e t#e remi'm ricin. arac# )#ic# #as +een a maBr reasn r its strn. ast inancial errmance< Exhi,it 6- s#)s ra.nCare Canadas &rd'ct &sitinin. Ma M!G*TI$E T!T*EF

In rder t strate.icall" 'se its limited res'rces and t minimie risk, ra.nCare Canada s#'ld 'se a cncentrated marketin. arac# and limit its erts t estern Canada and nic#e se.ments t +'ild a strn. +rand ima.e and .ain a irm t#ld in t#e Canadian market< ra.nCare s#'ld enter t#e Canadian market )it# nl" t#e TCM rd'ct line since ra.nCare can dierentiate itsel +est n t#e +asis  its researc# and scientiic caa+ilities =)#ic# are mre alica+le t t#is line  atenta+le rd'cts> and +eca'se t#e Canadian market ers mre rt'nities in t#is se.ment< ('rt#er, ra.nCare s#'ld initiall" restrict itsel t a ver" limited n'm+er  rd'cts )it#in t#e TCM cate.r"< nce t#e ra.nCare +rand is esta+lis#ed, it can la'nc# ne) rd'cts and increase t#e ran.e  erin.s< !ter ra.nCare esta+lis#es itsel as a market leader in estern Canada it can levera.e n its +rand ima.e and tar.et t#e eastern Canadian

10

markets0 ra.nCare s#'ld t#en lk at settin. ' TCM clinics 'nder its +rand name in rder t cmlete its rmise  +ecmin. an end-t-end TCM rvider< T red'ce risk and increase t#e c#ances  a s'ccess'l rd'ct la'nc#, )e recmmend t#at ra.n care des sim'lated market testin. ll)ed +" cntrlled market testin. t ens're t#at its rd'cts are )ell acceted +" t#e tar.et se.ment d'rin. t#e act'al la'nc#< im'lated testin. invlves +servin. t#e 'rc#asin. +e#avir  a c's .r' in a test envirnment cntainin. vari's TCM rd'cts incl'din. t#se  cmetitrs ll)ed +" a rd'ct satisactin s'rve" a e) )eeks later< !s art  cntrlled market testin. ra.n care )ill la'nc# t#e rd'ct in a e) lcatins )it#in /anc'ver t .a'.e t#e cns'mer reactin t its rd'cts and t#en accrdin.l" mdi" its strate." d'rin. t#e act'al la'nc#  t#e rd'ct< ra.nCare )ill #ave t adat its marketin. strate." t s'it t#e needs  t#e tar.et Canadian market – :T#ink El+all" !ct call";< T#is ma" res'lt in #i.#er initial csts +'t )ill #el sec're a lar.er market s#are and .reater ret'rn< T dierentiate itsel rm cmetitrs )# are rimaril" tar.etin. t#e C#inese immi.rants, ra.nCare s#'ld :esternie; t#e names  its rd'cts and its acka.in., cmm'nicatin, advertisin. and rmtin activities t tar.et t#e al'ent )estern Canadian )men< T#e detailed marketin. lan is elained later in t#e rert< C!$!I!$ TCM M!G*T *EM*$T!TI$  I*$TI(FI$E T%* T!E*T *EM*$T

e 'sed t#e ll)in. criteria t se.ment t#e Canadian TCM Market and identi" t#e Tar.et e.ment r ra.nCare Canada< •

Meas'ra+ilit"? T#e sie, 'rc#asin. )er and rile  t#e se.ment=s> s#'ld +e J'antiia+le +Bectivel"<

•

!ccessi+ilit"? T#e market se.ment=s> s#'ld #ave eas" accessi+ilit"<

•

'+stantialit"? T#e market se.ment=s> s#'ld +e lar.e and rita+le en'.# t serve<

•

!ctina+ilit"? *ective r.rams can +e desi.ned t attract and serve t#e se.ment=s><

•

Er)t#? T#e se.ment=s> s#'ld +e 'nder.in. raid .r)t#<

•

tr'ct'ral !ttractiveness? !vid se.ments t#at #ave man" strn. and a..ressive cmetitrs<

11

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Cman" +Bectives and es'rces? ra.nCares mst rita+le rd'cts are in t#e atented TCM .r' r c#ildren and )men<

ased n t#ese criteria )e identiied t#e middle t #i.# incme )men in )estern Canada as 'r immediate tar.et se.ment< T#is se.ment #as a market sie  @213 millin and is .r)in. at an ann'al rate  20A6&< eer Exhi,it 67 r market sie calc'latins< Explanation o* the Segmentation Process(

evel 0 e.mentatin? Dsers$n-'sers  #er+al rd'cts evel 1 e.mentatin? Incme T#e 'latin  Canada 'sin. #er+al rd'cts )as divided int t#e ric# and 'er middle class 'sers and t#ers< T#e 'se  $%&s in Canada des nt necessaril" deend n incme levels6;< %)ever, nl" t#e ric# and 'er middle class Canadians )ere cnsidered as t#e tar.et market r ra.nCare since it is .in. t sitin itsel as a remi'm +rand< evel 2 e.mentatin? Eender ! s'+stantiall" #i.#er rrtin  Canadian )men =49A> t#an men =37A> 6/are 'nd t 'se #er+al rd'cts and are t#'s identiied as t#e rimar" tar.et market< evel 3 e.mentatin? !.e men +el) t#e a.e  15 are cate.ried as c#ildren and nt incl'ded as t#e rimar" tar.et se.ment as t#eir #ealt# cnsideratins dier rm t#se  lder )men< evel 4 e.mentatin? Ee.ra#" estern Canada, eseciall" ritis# Cl'm+ia and !l+erta, )ere c#sen as t#e .e.ra#ic tar.et markets as t#e likeli#d  takin. nat'ral #ealt# care rd'cts in Canada increases rm east t )est )it# C and !l+erta Bintl" ranked #i.#est at 51A< =*#i+it 5> T#e l) cst advanta.e, t#e #i.# J'alit"  lie, a lar.e n'm+er  !sianC#inese immi.rants in )estern Canada =an eistin. c'stmer +ase r TCM rd'cts> and t#e ease  imrts rm !sia 'rt#er tilted t#e +alance in avr  estern Canada as t#e rimar" tar.et market r ra.n Care< eer Exhi,it 6& r !sian Immi.rant &'latin istri+'tin in ritis# Cl'm+ia<

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T(C – &#armace'ticals and $at'ral %ealt# &rd'cts Market esearc# 2003 )))
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!ter t) "ears, ra.nCare s#'ld etend its rd'ct line t incl'de #ealt#care rd'cts r c#ildren =Market sie  @30 millin< eer *#i+it 14 r calc'latins> since t#e c'rrent tar.et se.ment, )men, are t#e rimar" decisin makers r t#e 'rc#ase  t#ese rd'cts< M!G*TI$E &!$

Product

ra.nCare s#'ld intrd'ce t) atented )mens #ealt#care rd'cts r n'tritinal +eneits  imm'nit" develment =55A  cns'mers 'se $%&s r t#is reasn>18 and esta+lis# t#ese as ra.nCare Canadas :(la.s#i &rd'cts;< T#e limited rd'cts arac# )ill ena+le ra.nCare t sta" c'sed and strate.icall" allcate its limited +'siness res'rces t +e mre eective in its +rand +'ildin. activities< T#e acka.in. s#'ld relect t#e remi'm sitinin. and val'e rsitin  t#e rd'ct< T#e acka.in. and la+elin. m'st meet t#e reJ'irements  t#e Cns'mer &acka.in. and a+elin. !ct, Canada< &acka.in. m'st ens're t#at t#e medicines are nt aected +" temerat're, li.#t, transrtatin and stra.e< &l"et#"lene liners ma" +e #eat sealed t .ive an air-ti.#t cls're< #ile vac''m ackin. is nt .enerall" 'sed, it is eective in reservin. J'alit" and cmresses t#e rd'ct acka.e int a smaller vl'me )#ic# can lead t savin.s in rei.#t csts< &ackets r alletiatin are s'ita+le since t#e" red'ce #andlin. and #ence dama.e t t#e rd'ct< T#ere s#'ld +e cnsistenc"  acka.in. and acka.e sies, an rderl" ladin.  cntainers, s#iin. marks n t#e master ack and article n'm+ers n t#e inner acks< #iin. cntainers m'st +e clearl" stamed r stenciled n a minim'm  t) sides )it# all cde markin.s, and in )aterr ink< T#e acka.es s#'ld +e st'rd" en'.# r m'ltile #andlin.< e'sa+le rat#er t#an dissa+le acka.in. addresses envirnmental cncerns  Canada< &rer acka.in. is imrtant since s'+-standard acka.in. ma" dama.e t#e rd'ct and create r+lems r t#e marketin. t#e .ds and cnlict )it# t#e ima.e  :#i.# J'alit";19< !n attractive .reen +ttle )it# a la+el  t#e t"e indicated in *#i+it 16 )ill s'ccess'll" cnve" ra.nCares +rand messa.e  #ealt#  J'alit"< T#e la+el m'st cnrm t t#e Canadian standards as recmmended in t#e Cns'mer &acka.in. and a+elin. !ct ='al lan.'a.e la+elin.
$M!C< )))
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reJ'irement> and m'st #ave a c'stmer s'rt#elline n'm+er as )ell as t#e Canadian )e+site address< T#e rd'ct m'st als +e accmanied +" a rinted lealet )#ic# rvides inrmatin a+'t dsa.e, indicatins, )arnin.s, eir" date and t#er relevant inrmatin< Dnder t#e la)s  Canada, dr'.s )#ic# are disla"ed r sale t t#e '+lic cannt +e imrted r sld 'nless t#e" are cntained in a sec'rit" acka.e< T#e sec'rit" inrmatin m'st +e ill'strated n eit#er t#e 'ter r inner la+el 20< Price

ince ra.nCare )ill er a +randed, #i.# J'alit" rd'ct, )e s'..est t#at it adt a remi'm ricin. strate." and rice its rd'cts at ar'nd @32- @35+ttle =etail &rice in Canadian @>< (r t#e t)in ack, t#e rice s#'ld +e @55-@60ack< C'rrent rices in t#e Canadian market r similar TCM rd'cts are ar'nd @21-35+ttle21< T#e ratinale r t#e ricin. strate." is :/al'e ased &ricin.; +ased n an anal"sis  'rc#asin. )er  t#e tar.et se.ment and t#e c'rrent c'stmer sendin. n #er+al rd'cts< Cncerns n #ealt# and need r .d J'alit" are n t#e rise and crresndin.l" t#e )illin.ness t send n alternative medicine is increasin.< Mrever, allat#ic #ealt# eendit'res are cvered +" .vernment s mre dissa+le incme r alternate #ealt# care rd'cts is availa+le r c'stmers< ('rt#er, a #i.# rice )ill ali.n )it# ra.nCares sitinin.  a remi'm +rand and #ave a cnntatin  #i.# J'alit" assciated )it# it< !ls, as er market researc# st'dies, demand is relativel" less elastic r medicinal rd'cts< %ence, t#e #i.#er t#an avera.e rices  ra.nCares rd'cts s#'ld nt +e a cncern< Promotion

ra.nCare )ill 'se a m'lti-rn.ed arac# =cm+inatin  's# and 'll rmtinal strate.ies> r esta+lis#in. its +rand and it )ill #ave a +'d.et  @2<5 millin r rmtins in 2006 =eer Exhi,it 6/ r rmtin +'d.et allcatin details>< T#e maBr actrs t#at aect t#e decisin  Canadian c'stmers in t#e 'rc#ase  #er+al rd'cts are amil"riend =36A>, #ealt# +ks =18A> and medical ractitiners =9A>22< %ence, it is essential t 'se t#e rmtin +'d.et in t#se ve#icles )#ic# can #el .enerate c'risit", a)areness and a sitive )rd  m't# in t#e market< T#is )ill 20

(d  r'.s !ct, Canada< C#ater (-17 Cmetitr )e+sites< )))<.c#er+s
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ens're t#at nce ra.nCare #as cleared t#e +arrier  develin. an initial c'stmer +ase set ', it )ill #ave a sel-s'stained advertisin. medi'm< ra.nCares '+lic relatins activities, advertisin., sales rmtins, in-stre rmtins an d direct mailin. )ill all +e desi.ned )it# t#is in mind< Pull Strategies(

Advertising: ra.n care s#'ld c's its advertisin. n its rd'cts +eneits, its

scientiic researc# la+s and n in.are - a clean  r.ressive cit"< T#is )ill #el +'ild cns'mer cnidence n t#e #i.# J'alit"  its imrted rd'cts< It s#'ld als assciate itsel )it# #ealt# and itness eerts and srts icns t 'rt#er a'.ment its +rand ima.e< ra.n Care s#'ld 'se m'ltile media ve#icles t reac# t#e tar.et c'stmers< It s#'ld r'n ads n Ca+le T/ )#ic# is a relativel" ineensive medi'm r r'nnin. televisin ads as cmared t t#er c#annels< !dvertisin. in )men #ealt# ma.aines s'c# as C#atelaine, Canadian ivin. and %memakers s#'ld +e a rimar" means  reac#in. t#e #ealt# cnsci's al'ent )men  C and !l+erta< adi ads r'n d'rin. mrnin. and evenin. rimetime are ver" reasna+l" riced and can rve t +e a ver" imrtant tl r +rand +'ildin.< ill+ards laced at strate.ic lcatins s'c# as d)nt)n area, near )mens #ealt# cl'+s, near #armacies etc are an eective and end'rin. )a"  reac#in. t#e tar.et c'stmers< ra.nCare s#'ld #ave a dail" advertisement =25 lines> in t)  /anc'vers leadin. ne)saers El+e  Mail and $atinal &st< nline ads and +anners n #ealt# related )e+sites s#'ld als +e 'sed t tar.et t#e tec#-savv" )men  )estern Canada< =!dvertisin. 'd.et @1<36 Millin< eer *#i+it 17 r allcatin amn. dierent ve#icles and cstc'stmer calc'latins>< ra.nCare s#'ld als devel its )n )e+site )))
ens'rin. t#at ccasinal articles n ra.nCare and its rd'cts aear in #ealt# ma.aines and rint media< !dditinall", t#e '+lic relatins ert ma" incl'de c#arit" events, s'l"in. ree samles n :Mt#ers a";, :mens a"; etc< ra.n care s#'ld articiate in scial ca'ses related t )mens #ealt# iss'es t create a)areness and .d)ill r ra.nCare and its rd'cts< ra.n care s#'ld als articiate in ann'al s#)s s'c# as :T#e Canadian %ealt# (ds !ssciatin =))); s#)

15

and :T#e Imrtance  )mens #ealt#; s#)< =&'+lic elatins 'd.et? @185000< eer *#i+it 17 r details> Blogs: ra.nCare s#'ld 'se innvative tec#niJ'es like +l..in. t .enerate a sitive

)rd  m't# in t#e market< !s art  t#is rmtin, ra.nCare s#'ld initiatearticiate in disc'ssins n #er+al rd'cts in +l. sites s'c# as )))<+l.scanada
Sales Promotions: e recmmend t#e 'se  t#e ll)in. sales rmtins at dierent

times d'rin. t#e "ear< (ree samles s#'ld +e .iven t TCM ractitiners )# can t#en distri+'te t#se t t#eir c'stmers< !s art  a maBr rmtin strate.", a ree samle can +e distri+'ted )it# eac# c"  ne  t#e leadin. )men #ealt#care ma.aines< ra.nCare can als sell val'e acks =t) r t#e rice  ne> )#ile la'nc#in. t#e secnd rd'ct in t#e market r )men, add c'ns in +ttles )#ic# .ive a disc'nt =5-10A> r t#e net 'rc#ase and can als +'ndle t#er items s'c# as ke" c#ains, ens, cee m'.s =)it# t#e ra.nCare name and l.> t +'ild t#e +rand and t increase sales< ra.nCare s#'ld als #ave camai.ns )#erein c'stmers can )in attractive ries s'c# as televisin, di.ital cameras, and m'sic s"stem )it# 'rc#ases  ra.nCare rd'cts< ='d.et r ales &rmtins? @655000< eer *#i+it 17 r details> In-stre rmtins? ra.nCare s#'ld er trade disc'nts t retailers t sec're rime s#el sace in t#eir stres, eridicall" a" etra r rminent saces, #ave camai.ns r ra.nCare rd'cts d'rin. )#ic# t#e" are attractivel" disla"ed )it# ra.nCare +anners< ='d.et? @150,000> Direct Mail: ra.nCare s#'ld 'rc#ase t#e list  #er+al rd'ct cns'mers =data

driven market researc#> and send catal.'es, +rc#'res etc seciicall" tar.eted at t#ese 'sers< C'stmer inrmatin reJ'ired r direct mail camai.ns can +e  +tained rm mens %ealt# cl'+s, C#inese &rrietar" Medicine cieties and t#e retail c#annels t#at ra.nCare )ill +e ailiated t< ='d.et? @80,000< eer *#i+it 17 r cstc'stmer calc'latins>

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Distribution

T#ere are t#ree main distri+'tin c#annels )#ic# ra.nCare s#'ld adt in Canada? #ealt# d stres, #armacies, and TCM ractitiners< T#e nline c#annel is nt recmmended d'e t l) I rm t#is c#annel< Natural Health Product Stores: ra.nCare s#'ld rimaril" tar.et t#ese stres r sale

 t#eir rd'cts t#r'.# t#eir distri+'tin net)rk< Pharmacies: !+'t 51A  Canadian &#armacies are c#ainranc#ise stres like #ers

r'. Mart, &#arma &l's and Oean C't'23<  ra.nCare s#'ld 'se t#is as a secndar" c#annel< It can 'se distri+'trs like 'rce Medical ====.s$urcemedical.c$m >, ie &#arma ====.li&eharma.c$m > and Mckessn ====.mckess$n.c$m > t +tain s#el sace in t#is c#annel< ra.nCare can 'tilie t#e Canadian !ssciatin r &#armac" istri+'tin t +'ild relatins )it# t#e leadin. distri+'trs< (r ease  c- rdinatin and t avid c#annel cnlicts as )ell as t red'ce risk rm sin.'lar deendenc", ra.n care s#'ld 'se ne distri+'tr eac# r C and !l+erta< TCM Practitioners: ra.n care m'st tr" and 'se %ealt# Care &ractitiners t cat're

ne) adters  TCM< ra.nCare s#'ld 'se t#is c#annel sarin.l" .iven t#at t#ere are man" la"ers i.#tin. r t#is c#annel alread"< E!$IH!TI$! &!$  M!$!E*M*$T TDCTD*

!ission% &ision ' &alues"

e +elieve t#at t#e Canadian s'+sidiar"s missin s#'ld +e inline )it# t#e &arent cman"s missin  :Carin. r t#e rld;< ('rt#er, t#e Canadian arms visin s#'ld relect t#e &arent cman"s desire t +e a tr'l" .l+al +rand< ased n t#is reasnin., )e rse t#e ll)in. r t#e Canadian s'+sidiar"  ra.nCare< DragonCare Canadas !ission Statement"

:Carin. r %'manit" +" rvidin. t#e traditinal r'te t lead a #ealt#" lie<; DragonCare Canadas &ision"

:T +e a .l+al #ealt#care cman" secialiin. in Traditinal C#inese Medicine<; DragonCare Canadas &alues"

23

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(c's – 'r c'stmers<

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P'alit" – 'erir rd'cts<

T(C – &#armace'ticals and $at'ral %ealt# &rd'cts Market esearc# 2003< )))
17

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&ele – /er" carin.<

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esearc# – &at# +reakin.<

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t"le – trn. team)rk<

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&sitin – eader<

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e)ard – ec.nitin and sec'rit"

(egal description of the company"

T#e Canadian arm  ra.nCare )ill +e a )#ll" )ned s'+sidiar"  ra.nCare td and )ill +e named ra.nCare Canada imited< T#e cman" )ill +e incrrated as a searate s'+sidiar" 'nder t#e ederal stat'te and )ill +e #eadJ'artered in /anc'ver, ritis# Cl'm+ia< %)ever, t#e cman" )ill als +e re.istered in ever" rvince it erates in and )ill #ave +ranc# ices in all t#se rvinces< =$te? It is a .vernment reJ'irement t #ave a cman" re.istered in ever" rvince it erates in and t #ave a re.istered ice in eac#  t#se rvinces>24< T#e +ranc# ices are s'+Bect t la)s  t#e rvince in )#ic# t#e" erate< T#e" )ill maintain rer recrds and ile ta ret'rns as reJ'ired< %)ever, t#e arent cman" )ill ass'me 'nlimited lia+ilit" r t#e de+ts =i an">  its +ranc# eratins25< DragonCare Canadas #rgani$ation Structure" eer Exhi,it 68 r t#e ertin. tr'ct're  t#e Canadian mana.ement team vis-Q-vis

t#e cman"s t level mana.ement< T#e +asic rertin. str'ct're  t#e c'ntr" #ead =EM Canada> vis-Q-vis t#e ra.nCare t +rass #as nt +een c#an.ed since it #as s'ccess'll" adted t#is ver" str'ct're r all its s'+sidiaries< %ence, EM Canada )ill rert t /&-ales  etail< EM Canada need nt #ave a direct rertin. )it# Man'act'rin. since it is t#e ales eartment )#ic# .ives rd'ctin reJ'irements t man'act'rin. ince ra.nCare Canadas c's )ill +e marketin., t#e marketin. #ead )ill rert directl" t EM Canada< T#e marketin. mana.er )ill +e resnsi+le r all asects  marketin. and )ill assist EM Canada in etail istri+'tr elatins#i Mana.ement, )#ic# is ke" t ra.nCares +'siness mdel< %e )ill als versee CM erts t#at ra.nCare Canada )ill erate< 24 25

Invest in Canada )))
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!ls, a  Crdinatr )ill act as a link +et)een Canadian Evernment and ra.nCares  divisin r matters re.ardin. certiicatin, rd'ct saet" etc< T#is crdinatr )ill rert directl" t EM Canada n rd'ct J'alit", saet" matters and develment  ne) rd'ct variants< T#e .istics mana.er )ill +e in-c#ar.e  crdinatin. )it# t#e distri+'trs, recastin., and #andlin. in+'nd and 't+'nd traic incl'din. c'stms< %e )ill als assist t#e Marketin. Mana.er in sterin. strn. relatins#is )it# t#e distri+'trs< !anagerial Autonomy ' Re)ard System"

T#e Canadian divisin )ill #ave 'll a'tnm" in allcatin. t#e res'rces availa+le t it< %)ever, t#e t +rass  ra.nCare td )ill decide #) m'c# res'rce t make availa+le t t#e Canadian divisin +ased n its a+ilit" t ac#ieve t#e arents strate.ic .als< T#e errmance eval'atin  t#e Canadian mana.ement team )ill +e +ased n t#eir a+ilit" t ac#ieve "earl" ales and &rit .r)t# tar.ets< e recmmend 'sin. +t# t#ese as criteria r eval'atin +eca'se? a> ales .r)t# is inline )it# t#e arent cman"s .r)t# visin and +> It is imerative t ac#ieve t#e sales .r)t# )#ile als maintainin. t#e remi'm +randin. and ricin. strate."< !c#ievin. ne i
It is nt advisa+le r ra.nCare Canada t vent're int retailin.  its rd'cts in Canada, at least r t#e irst e) "ears, since it )ill #ave a ver" limited rd'ct ran.e< Instead it s#'ld levera.e Canadian istri+'trs =+t# %er+al and $n- %er+al rd'ct distri+'trs> t reac# leadin. #armac"  $%& 'tlets< ra.nCares val'e rsitin t t#ese istri+'trs is? a> In ra.nCare, t#e dealer )ill ind an a+le all" )# )ill invest #eavil" in +'ildin. a strn. +rand r its scientiicall" develed rd'cts< +> ra.nCares rd'cts )ill rvide t#e distri+'tr ant#er aven'e r .r)t# at almst n cst<

19

c> ra.nCares remi'm rd'cts )ill rvide t#e distri+'trs an attractive rsitin t make #i.#er mar.ins< d> ra.nCare )ill #el t#em +rid.e a .a +et)een t#eir c'rrent line  rd'cts =nn-TCM rd'cts> and a .r)in. c'stmer demand r TCM rd'cts< *iring Plan" Activity Start
(inance #eads and  Crdinatr %irin. (inance, Marketin.

st

1 !'. 05

End
15 ct 05

%esponsi,ility M  /& ales /& ales 

EM Canada ('nctin %eads

 .istics Teams T#e EM  ra.nCare Canada )ill +e selected rm amn. t#e eec'tives  t#e in.are divisin< T#is ersn s#'ld #ave a ln. #istr" )it# ra.nCare and s#'ld +e amiliar )it# ra.nCares c'lt're, #ils#" and strate."< It )ill +e +eneicial i t#is eec'tive )as invlved in ne  ra.nCares earlier .l+aliatin rBects and #as a +ack.r'nd in Marketin.< " selectin. t#e EM Canada rm amn. t#e eec'tives in in.are, ra.nCare td can ens're t#at t#e Canadian arm #as #ils#ies, strate." and c'lt're similar t t#se  t#e arent divisin< ra.nCare Canada )ill #ire Canadians t all t#er mana.ement sitins, eseciall" Marketin.< T#is is necessar" since #eads  t#ese 'nctins need t #ave a t#r'.# 'nderstandin.  t#e Canadian market and t#e )a" it )rks< T#ese mana.ers )ill t#en +e trained at in.are r a e) )eeks t rient t#em )it# t#e ra.nCare c'lt're and )a"  )rkin.< ra.nCare td s#'ld als send sme t level eec'tives rm its in.are divisin t Canada r a e) mnt#s t #el set ' t#e Canadian divisin and mentr t#e mana.ement in Canada< Exhi,it 69 s#)s t#e %ead C'nt &lanned r ra.nCare Canada in 2005-06< &*!TI$! T!T*EF

#perating !odel"

eer Exhi,it -. r t#e c#ematic  t#e eratin. Mdel t +e adted< ra.nCare Canada )ill s'rce .ds rm ra.nCares man'act'rin. sites in in.are and Mala"sia and 'se strate.ic alliances )it# Canadian #arma-rd'cts distri+'trs t reac# t#e #arma-retailers and 'ltimatel" t#e end 'sers<

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T#e s#iin.  .ds =lead time 45 da"s>26 rm in.areMala"sia t Canada )ill +e 'ts'rced =reera+l" t t#e rei.#t r)arder )# #andles ra.nCares c'rrent ert s#iments t t#er c'ntries>< Rationale Behind the Choice of #perating !odel"

&rimar" ecisin Criteria? a> ) isk

+> %i.# &rit

c> %i.# Cntrl

+> (ast Imlementatin

c> ) Investment

ecndar" ecisin Criteria a> %i.# easi+ilit"

T#e a+ve mentined eratin. mdel )ill all) ra.nCare t red'ce its risk +" a> imitin. its investment +> !ll)in. it t c's n its cre cmetencies – &rd'ct P'alit"  Marketin. c> &rvidin. it an rt'nit" t levera.e t#e eerience  a artner =t#e Canadian istri+'tr> )# #as a s'nd 'nderstandin.  t#e Canadian Market< d> &rvidin. it an eas" )a"  tain. a )ide ran.e  retail #armac" 'tlets< ('rt#er, t#is strate." )ill all) r.anCare td t eratinalie its Canadian arm in a s#rt time =8 mnt#s>< e +elieve it is critical r ra.nCare t cme t market in J'ick time and +'ild itsel a nic#e sitin in t#e market lace +ere cmetitin #eats '< %e*er Exhi,its -6 to -7 t 'nderstand :*val'atin  !lternatives;< Challenges Associated )ith the chosen #perating !odel"

a> esnse t Market l'ct'atins? n. 'l" C#ain can res'lt in sl)er resnse t meet s'dden c#an.es in c'stmer demand< e #e t c'nter t#is +" maintainin. a #i.# level  inventr" =ar< 67 da"s  inventr"> r t#e irst t) "ears till )e amiliarie 'rselves )it# t#e Canadian market +e#avir and t#e ne) 'l" C#ain< %)ever, t#is )ill res'lt in #i.#er )rkin. caital reJ'irements< %avin. nl" t) rd'cts in t#e irst t) "ears )ill #el red'ce cmleit" and en#ance 'r a+ilit" t mana.e inventr" eectivel"< +> C-rdinatin )it# istri+'tr n all asects – sales recastin., rmtin activities, s'l" c#ain matters etc )ill #ave t +e dne eceedin.l" )ell< It )ill take sme time r t#e relatins#i t devel )ell and t#in.s t start 'nctinin. smt#l"< e lan t vercme t#is iss'e +" tr"in. t devel a ln. term 26

#tt?)))
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strate.ic relatins#i )it# t#e cncerned distri+'tr< T#e .istics Mana.er )ill +e assi.ned t#e resnsi+ilit" t #andle all s'l" c#ain and recastin. activit" crdinatin )it# t#e distri+'tr< T#e Marketin. Mana.er )ill +e resnsi+le r c-crdinatin. rmtin and data cllectin activities< Applicable Statutory Re+uirements"

Mandatr" icensin. eJ'irements? •

&rd'ct icense? In Canada, t#e ederal .vernment is resnsi+le r t#e licensin. and mnitrin.  dr'.s, d, medical devices and nat'ral #ealt# rd'cts< ra.nCares rd'cts )ill +e .verned +" t#e :$at'ral %ealt# &rd'ct e.'latins;  Canada< (r mre details visit? h##:<
•

'siness $'m+er? eJ'irement +" Canadian even'e !.enc" r inancial rertin.27<

•

ite icense? (r )nin. landrert"sace<

Mandatr" Ins'rance Cvera.es? •

(ire ins'rance =etended cvera.e n +'ildin.s and cntents>

•

ia+ilit" ins'rance =a.ainst c'stmer cmlaints>

•

'r.lar" rtectin =t#et cvera.e>

•

is#nest" ins'rance =cvers t#ets +" eml"ees>

ist  Ge" !cts )#ic# )ill re.'late ra.nCare Canada? •

he -nves#men# anada ,c# ? e.'lates (rei.n Investment in Canada< ra.nCare

)ill need .vernment arval t set ' a s'+sidiar" in Canada< •

ml$ymen# Bui#y ,c#? T#e act rvides r eJ'ita+le treatment  )men,

a+ri.inal eles, disa+led ele and visi+le minrities in t#e )rklace< •

(d and r'.s !ct and e.'latins

•

&atent !ct !mendment !ct

•

Cns'mer &acka.in. and a+elin. !ct and e.'latins? $eed t meet certain minim'm la+elin. reJ'irements like la+elin. in *n.lis# and (renc#<

27

•

Cmetitin !ct

•

Trademarks !ct

Invest in Canada )))
22

•

C'stms Taris !ct

•

T#e &atented Medicines e.'latins

•

T#e Man'act'rin. and tra.e  &atented Medicines e.'latins

•

Ed Man'act'rin. &ractice E'idelines<

(r mre details n t#ese acts visit? a h##:<
d> #tt?)))<#c-sc<.c
eer Exhi,it -: r ra.nCare Canada rBect imlementatin .antt c#art< eer Exhi,it -& r list  resnsi+ilit" assi.nment r t#e rBect activities< ist  !ctivities Critical t Meet Imlementatin Timeline? a> &rd'ctin Caacit" *ansin +> Canadian istri+'tr 'rcin. c> #iin. 'lier 'rcin. d> icense !rvals $te? !ll t#ese activities d nt tie ' int a sin.le Critical &at#< %)ever t#ese activities need t +e .iven t ririt" t ens're a timel" la'nc#< DragonCare Canada’s Long Term Plan with Timelines

ra.nCare Canada s#'ld etend its rd'ct line in t) "ears and intrd'ce t#e c#ildrens #ealt#care rd'cts< It s#'ld als start t) TCM clinics in /anc'ver +" 2008 s t#at it can 'lill its val'e rsitin t c'stmers< ra.nCare s#'ld lan t eand t t#e eastern Canada, seciicall" ntari, in 2009 =+" t#en it s#'ld #ave esta+lis#ed a +rand name in )estern Canada>< It can t#en intrd'ce mre rd'cts =2010> and t#en en a cncet stre in /anc'ver =2011> )#ic# s#) cases t#e entire ran.e  ra.nCare rd'cts<

ra.ncare, )it# its limited res'rces s#'ld c's n .r)in. rimaril" in t#e Canadian market< %)ever, i a e) "ears d)n t#e rad, ra.nCare decides t enter t#e D market, it s#'ld cnsider settin. ' a man'act'rin. 'nit in Canada t take advanta.e  t#e $rt# !merican (ree Trade !.reement and 'se Canada as a man'act'rin. +ase r $rt# !merica< %)ever, )e d nt recmmend settin. ' a

23

man'act'rin. 'nit in Canada t tar.et t#e Canadian market as t#e rd'ctin csts are l)er in Mala"sia and in.are< eer Exhi,it -; r ra.nCare Canadas n. Term ll 't &lan< #perating -xpenses" Exhi,it -/ lists 't t#e 'd.eted eratin. *enses r "ears 2005 t 2010< (I$!$CI! !$!FI

eer 2inancial Per*ormance Exhi,its -8 to :: r rBected inancial statements, net resent val'e  rBect, +reakeven anal"sis, sensitivities and rati anal"sis< Source of .unds" e recmmend t#at ra.nCare td 'se ln. term inancin. rm its

c'rrent +ank in in.are t 'nd investment in ied assets< ee Exhi,it 76 r ttal inancin. reJ'ired +" ra.nCare Canada ' t 2010< Investment in )rkin. caital and initial set ' eenses  t#e Canadian eratins )ill +e 'nded +" t#e ecess cas#  ra.nCare td< In later "ears, ra.nCare Canada )ill sec're )rkin. caital reJ'irements rm a Canadian +ank< T#e c'rrent e+t*J'it" rati  0<57 and levera.e  1<52 rvide it .d inancial lei+ilit" and it s#'ld nt +e an iss'e r ra.nCare t .et additinal lans< ('rt#er, .iven ra.nCare tds strn. inancial errmance – increasin. rita+ilit", .d cas# l)s, #i.# interest cvera.e ratis and liJ'idit" ratis – and its s'nd ied assets +ase – lant, mac#iner", retail stres =real estate> in rime lcatins –, ra.nCare tds c'rrent +ank s#'ld nt #ave an" maBr r+lems in inancin. ra.nCares additinal 'ndin. reJ'irements< " ll)in. t#is strate.", ra.nCare )ill maintain a #ealt#" *ndin. Cas# alance =eer Exhi,it :6> t sae.'ard itsel a.ainst an" 'nt)ard develments and als reserve its inancial lei+ilit" r 't're .r)t# needs =eer Exhi,it :. r e+t*J'it" atis><

Application of .unds"

T#e 'nds )ill +e mainl" 'sed r rd'ctin caacit" eansin at t#e in.arean  Mala"sian man'act'rin. sites, 'ndin. )rkin. caital increases, develment   )e+site and initial set' and marketin. eenses  Canadian eratins< Structure of /e) (oans"

24

T#e rime lendin. rate in in.are #as +een sta+le at ar'nd 5<3A28 ver t#e ast 4 "ears and is eected t remain stead" in t#e near 't're29 d'e t t#e cntin'in. trend  l) inlatin< %ence, )e +elieve t#at it )ill nt ver" diic'lt t sec're a ied interest rate lan rm its c'rrent +ank< .inancial Ris0s ' Challenges"

Foreign !change Fluctuations

T#e Canadian llar is c'rrentl" .in. strn. and t#is is .d ne)s r ra.nCare tds lans t enter Canada n)< %)ever, an areciatin  t#e in.are llar a.ainst t#e Canadian llar in t#e near 't're cannt +e r'led 't and i t#is #aens, it )'ld +e detrimental t t#e interests  ra.nCare td< isk Miti.atin tes %ed.in. Cntracts s#'ld +e 'ndertaken )#en reJ'ired< "or#ing Ca$ital Re%uirements

T#e ln. s'l" c#ain makes it imerative t maintain a lar.e inis#ed .ds inventr" in Canada in rder t #ave t#e desired lei+ilit" t meet t#e Canadian market demands< T#is )ill +e tr'e at least r t#e initial "ears till ra.nCare Canada .ets t 'nderstand t#e market +e#avir and t#e s'l" c#ain iss'es +etter< %ence, t#e ln. s'l" c#ain )ill res'lt in a #i.#l" :&sitive Cas# C"cle;< !s a res'lt, inancin. )rkin. caital increases assciated )it# t#e a..ressive sales .r)t# recasted r t#e Canadian eratins )ill +e a c#allen.e< In rder t vercme t#is c#allen.e, sales .r)t# in Canada s#'ld +e accmanied )it# s'l" c#ain eicienc" imrvements and +etter inventr" mana.ement +ased n a s'nd 'nderstandin.  t#e Canadian market +e#avir<

Financial Ris#

Eiven ra.nCare tds .e.ra#ic diversiicatin and strn. inancial errmance, a stead" cas# stream t meet interest +li.atins des nt seem t +e an iss'e at resent< =eer Exhi,it :. r Interest Cvera.e i
tatistics in.are #tt?)))
25

('rt#er, +" takin. n de+t in a #ased manner =inline )it# t#e #ased eansin lan in Canada>, ra.nCare td )ill ens're t#at it is nt straddled )it# 'nmana.ea+le de+t i t#e Canadian +'siness des nt 'nld as lanned< DI$* IG Regulatory Ris0s" T#e !lternative %ealt# Care market is relativel" ne) and less strictl" re.'lated at resent< %)ever, .iven t#at t#is is a ast .r)in. se.ment in #ealt#care, t#e .vernment ma" imse stricter re.'latins in t#e 't're, eseciall" related t saet" standards< Mitigation Ste$s evel .d relatins#i )it# t#e .vernment and create a remi'm +rand

ima.e s'rted +" #i.# J'alit" and scientiicall" develed rd'cts< Competitive Ris0s" T#e TCM market in Canada can +e eected t attract man" la"ers in t#e near 't're

+eca'se  its attractiveness< !n entr" +" a :rand  esearc#; riented cmetitr can res'lt in ra.nCare acin. t'.# times in its nic#e se.ment< Mitigation Ste$s 'ild a strn. +rand in Canada J'ickl" t .ain t#e :irst mver

advanta.e; and als lck in t#e maBr #arma-rd'ct distri+'trs =and t#r'.# t#em, t#e retailers>< (itigation Ris0s"

T#e &#armace'ticals ind'str" is s'sceti+le t liti.atin risks< Mitigation Ste$s Cntract a re'ted le.al irm like % lck, t srt 't t#e le.al

iss'es in Canada< DragonCares (ac0 of Business -xperience in /orth America"

T#e lack  rir eerience  eratin. in $rt# !merica can se a si.niicant c#allen.e t ra.nCares erts t +e s'ccess'l in t#is market< %)ever, .iven t#e act t#at in $rt# !merica, ra.nCare sees its 't're .r)t#, it #as t take t#is lea< Canada can als act as a strate.ic testin.  la'nc#in. .r'nd r ra.nCares desire t ta t#e D market< Mitigation Ste$s T#e t mana.ement  t#e Canadian divisin =ecet EM Canada>

s#'ld all +e Canadians )# #ave ln. )rk eerience in $rt# !merica =reera+l" in t#e #er+al rd'cts ind'str"> and s#'ld +e )ell versed )it# t#e Canadian market cnditins<

DragonCare Canada 1 The 2ourney Begins *ere3 26

-xhibit 4"

5hy Canada as an Investment Destination 3

'rce? G&ME Cmetitive !lternatives E7 2004 editin

27

-xhibit 6"

P-ST Analysis

28

-xhibits on the Canadian /atural *ealth Products !ar0et -xhibit 7"

A !ar0et Research Summary

29

A) % of Canadians using NHPs = 51% B) Market Size of Herbal Medicine ndustr! in Canada = " 1#$ &illion C) Annual ndustr! 'ro(t *ate = +#% ,) % of -o&en using NHPs = $.% /) % of Men using NHPs = 0% 2) % of 3eo3le taking NHPs in Alberta and Britis Colu&bia = 51% %e*erences(

So!rce of "# D# $ % F tt34(((6nd&ac6ca N,MAC 7 Self Care and Healt 7 Consu&er Profile 7 8e use of Natural Products in Self Care So!rce of & % C (((6tfoc6ca TF&C Mar#et Research Re$ort on Pharmaceuticals and Natural Health Products '(()*

-xhibit 8"

9se of /atural *ealth Products:/*Ps;by Region

'rce? h##:<<===.ndmac.ca $M!C - el Care and %ealt# - Cns'mer &rile - T#e 'se  $at'ral &rd'cts in el Care

-xhibit <"

Reasons for ta0ing /atural *ealth Products :/*Ps;

30


-xhibit ="

.re+uency of Ta0ing /*Ps by Region reuen,y of (a!in' atural 4ealth -rou,ts /y Re'ion

Maritimes %

Québec %

Ontario %

Man./ Sask. %

Alberta %

British Columbia %

Daily

49

40

53

57

51

56

Occasionally

30

37

26

25

27

25

When Not Feeling Well

6

6

10

8

11

9


-xhibit >"

!se o* )4Ps ,y 4ousehold #ncome

31

'rce? h##:<<===.ndmac.ca $M!C - el Care and %ealt# - Cns'mer &rile – 'mmar"  em.ra#ic (actrs

-xhibit ?"

Sources o* #n*ormation *or Customers

'rce? h##:<<===.ndmac.ca $M!C - el Care and %ealt# - Cns'mer &rile – 'rces  Inrmatin

-xhibit @"

"he 2ive 2orces Analysis *or #ndustry Attractiveness

32

Rule" 5ea0er the .orces% *igher )ill be the Profitability ' Attractiveness of the Industry

-xhibit 4"

-valuation of Canadian -ntry Strategies

33

3ther 2actors Considered

=oint $enture

Ac+uisition

Imlementatin Time Investment ra.nCares ast eerience )it# t#e !lternatives &tential t evera.e &artners Gn)led.e a+'t t#e Canadian Market

) ) $ne

) /er" %i.# $ne

%i.#

Mderate%i.#

)ew Manu*acturing Set !p in Canada %i.# /er" %i.# $ne

Exporting

)

)

) Mderate %i.#

-xhibit 44"

34

35

-xhibit 46"

36

-xhibit 47"

Mar1et Si>e *or ?omen@s Products

estern $anaa oen>s atural 4ealth -rou,t &ar!et Sie $al,ulations , !$ula#i$n $& anada % $& !$ula#i$n ?sing a#ural eal#h !r$duc#s !s umber $& $nsumers $& !s *% $& anadian !$ula#i$n in ?er iddle and igher -nc$me gr$u umber $& ?er iddle class and ich class c$nsumers $& !s +% $& E$men in am$ng  Cumber $& ?er iddle and igher -nc$me =$men c$nsumers $& !s % $& ab$ve =$men $ula#i$n in 15F age gr$u -umber $& =$men in 15F age gr$u using !s G% $& - in  and ,lber#a Humber $& =$men users $& herbal medicines in #he 15F age gr$u in  and ,lber#a /,verage sending er m$n#h &$r ab$ve =$men $ula#i$n $n !s $#al oen atural 4ealth -rou,t &ar!et Sie in canadian d$llars er year % $&  &$r r$duc#s similar #$ *rag$ncare;s  arge# arke# siIe in canadian d$llars er year !ne canadian d$llar #$ Sing$re d$llar c$nversi$n &ac#$r Jarge# arke# siIe in Singa$re d$llars er year

30750100 51% 15682551   ,D 65% 10162293   D* 51% 5192932 C  +D 91% 4709989 -  CD 24% 1130397 H  GD'30 '406A943A058   HD/ 40% '162A777A223   D '1.31 213:238:162 J  !D

Sour,e of );< h##:<<===.ndmac.ca!age-*10>Sub!age-*950>&kain!age10

Sour,e of  " 4;:h##:<<===.ans=ers.c$m<#$ic
"arget Mar1et Si>e rowth 3ver Years Year E.pe,te Growth Sie ?in 000>s SG+;

2006 20% 213238

2007 20% 255886

2008 15% 294269

2009 13% 332524

2010 10% 365776

Note: Er)t# in estern Canada is recasted t sl) d)n in t#e l ater "ears as t#e market mat'res<

-xhibit 48"

!ar0et Si$e Calculations for Childrens Products

estern $anaa $hilren>s atural 4ealth -rou,t &ar!et Sie $al,ulations , !$ula#i$n $& hildren in anada M 10 Nears $& age % $& -n&an# !$ula#i$n in  > ,lber#a Same as % $& andian !$ula#i$n in  >,lber#a umber $& hildren in  > ,lber#a *% $& hildren !$ula#i$n in ?er iddle and igher -nc$me gr$u umber $& hildren in ?er iddle class and ich class +,verage umber $& hildren < +amily in anada Cumber $& ?er iddle lass > igher -nc$me $#hers in  > ,lber#a  % $& $#hers =h$ use a#ural eal#h !r$duc#s !s &$r #hemselves - umber $& $#hers using !s G % $& - =h$ =ill buy !s &$r #heir kids H umber $& $#hers buying !s &$r #heir kids / ,verage sending er m$n#h $n !s $#al hildren;s atural 4ealth -rou,t &ar!et Sie in canadian d$llars er year % $&  &$r r$duc#s similar #$ *rag$ncare;s  arge# arke# siIe in canadian d$llars er year !ne canadian d$llar #$ Sing$re d$llar c$nversi$n &ac#$r Jarge# arke# siIe in Singa$re d$llars er year

3700000 23% 854700   ,D 65% 553846   D* 1.5 369230 C  <+ 51% 188308 -  CD 85% 160061 H  -DG '30 '57A622A096   HD/ 40% '23A048A838   D '1.31 30:193:978 J  !D

So!rce of "' tt34(((6absoluteastrono&!6co&enc!clo3edia,,e,e&ogra3ics9of9Canada6t& So!rce of &' tt34(((6absoluteastrono&!6co&enc!clo3edia::i:ist9of9Canadian93ro;inces9and9territories9b!93o3ulation6t& So!rce of D' tt34(((6cfc7efc6cadocsccsd#####0+$6t&6 <$t and 5t uintiles a;e been considered) So!rce of F tt34(((6statcan6caenglisPgdbfa&il5#a6t& So!rce of (' tt34(((6nd&ac6cainde>6cf&?fuseaction=&ain6,s3SubPage@Page,=1#@SubPage,=.5#@fkMainPage=1# So!rce of )' An esti&ate6 Most &oters (ill (ant to 3ro;ide te ealt benefits te! get fro& NHPs to teir kids6 So!rce of L tt34(((6c7sc6gc6ca33bealtcare3ubsco&39altstock6t&l N $#% of erbal &edicines in te &arket are 8CM 3roducts6

37

-xhibit 4<"

anadian $#al hinese +iliin$ Oie#namese $#al ,sia) !aci&ic

ri#ish $lumbia hinese +iliin$ Gaanese

@an,ouer hinese Oie#namese

Asian #mmigrant Population
#s a % of (otal $anaian -opulation

-opulation in &illions

#s a % of (otal -roin,e -opulation

3.8 0.38 0.068 0.037

10.00% 1.79% 0.97%

Rear!s

3.68% 1.01% 0.51% 5.20%

Rear!s hinese !$ula#i$n % in  is m uch higher #han canadian average and is 35% $& en#ire chinese $ula#i$n

-opulation in #s a % of (otal $ity>s &illions -opulation Rear!s Oanc$uver acc$un#s &$r 51% $&  $ula#i$n 1.96 $#e: ,lm$s# 90% $& chinese $ula#i$n in  is 0.347 17.70% in Oanc$uver 0.022 1.12%

"nsis  *#i+it? estern Canada, eseciall" ritis# Cl'm+ia, is an attractive market r ra.nCare d'e t t#e lar.e, cncentrated and tentiall" eas" t ta !sian Immi.rant &'latin<

'rce? h##:<<===.s#a#can.ca
38

-xhibit 4="

Sample 5a,el

-xhibit 4>"

Mar1eting Budget Allocation *or -..;

&!dget "llocation for *ar+et Tests $ost Rear!s 15000 /imi#ed Cr$u 50000 es#ing in Samle e#ail u#le#s in di&&eren# l$cali#ies

A Siulate (estin' A $ontrolle (est Enironent

&!dget "llocation for "dvertisements

@ehi,le

A 4ealth &a'ainesB)oo!s A )ill )oars

(otal Rea,hB $ir,ulation in estern $anaa $ostBCse ?SG+;

315000 150000 e$le er ill $ard

A $a/le (@

1300000

A Raio

2100000

A ewspaper

2000000

A nline #ts A (otal

1000000

reuen,yB +uration of Cse

'17000 er +ull !age ,dv#. 25 er Near '2500 er $n#h 10 $ards er $ard Near $und ' 200 er 30 secs sl$# F ' 5000 &$r devel$ing ,dv#. 1000 er Near '50 &$r a 30 sec airing 3000 er Near '10 er /ine '700 er m$n#h &$r =ebsi#es reaching 100000F

*aily 10 Eebsi#es Near $und

(otal #nnual $ost?SG+;

Estiate $ostB Response $ustoers $ustoer Rate #,uire ?SG+;

Rear!s

425000

3.00%

9450

44.97

300000

1.00%

15000

20.00

,dver#isemen#s in ha#elaineA anadian /iving > $memaker;s ill $ards in igh +$$# S#e ,reas /$= c$s# #arge##ed adver#ising #hr$ugh l$cal cable O. 4 *i&&eren# ,dv#s =ill be devel$ed

220000

1.20%

15600

14.10

150000

0.50%

10500

14.29

182500

0.50%

10000

18.25

&&ec#ive i& used reead#edly. 25 /ine ,d =i#h /$g$ *,-/N in #$ #=$ e=saers

84000 1361500

0.20%

2000 62550

42.00 21.77

nline ,dv#s Eill hel drive sales demand. ,verage $s#<us#$mer

Sour,es of *nforation Costs for Ca,le T- tt34(((6$b6co&&arketing#101((iobiz$adcable6t&l Cost of Developing T- "dvt tt34(((6cea37t;7s3ots6co&o3tions6t&l Cost of (ealth *aga.ine/&oo+s "dvt tt34(((6catelaine6co&binar!3dfCH/*ateCard63df 0each of (ealth *aga.ines/&oo+s tt34(((6transcontinental3ro6co&eng3dfcanadian9li;ing9&63df Costs for &ill &oards tt34(((6gaebler6co&Billboard7Ad;ertising7Costs6t& Costs for 0adio "dvt tt34(((6alberta3rolife6co&resourcesradio6t&l Costs of Online "dvt tt34;ancou;er6(eater3age6cainfo;(39rate9card9#0#563df Costs of Online "dvt tt34(((6;ista&agonline6co&articles3age633?s=ad9rates Costs of Online "dvt tt3s4ad(ords6google6co&su33ortbinans(er63!?ans(er=0+@l=en9S Costs of Newspaper "dvt tt34(((6canada6co&nationalnational3ostinfoad;ertisead93dfs+##591$9%+#-estern9*ates63df

!hibit +, Continued on Ne!t Page

39

&!dget "llocation for Sales Promotions $ost ?SG+;

Rear!s

)unlin' $oupons ree Saples with &a'aines

165000 100000

)unle other *tes ottery *nstore -rootions " (rae +is,ounts (otal

100000 100000

uy $ne ge# $ne &ree< disc$un# $n sec$nd *isc$un# $u$ns +ree Samles dis#ribu#ed =i#h 30000 eal#h agaIines *rag$nare l$g$ bearing Hey hainsA!ensA $&&ee ugs /ucky *ra= amaign

187500

150000 802500

Secial r$m$#i$n ac#ivi#ies in re#ail $u#le#s

&!dget "llocation for Direct *ail Campaigns $ostB-erson #pproa,he

Rea,h

+ire,t &ail $apai'ns

20000

'1 er re&erence F '2 a#erial F '1 !$s#age. arge#

(otal #nnual $ost

80000

Response Rate

0.08

$ustoers #,uire

1600

$ostB $ustoer ?SG+;

Rear!s

50

hese us#$mers can be e(ec#ed #$ have l$ng #erm Oalue #$ *rag$nare as # hey =ill de&ini#elyy be reea# buyers

&!dget "llocation for Other Promotions

ree Saples to -ra,titioners Sponsorships of So,ial " $harita/le $auses (rae Shows

-xhibit 4?"

$ost ?SG+;

Rear!s

16000

100 !rac#i#i$ners given 25 Samles each

150000 35000

igh Send inline =i#h /$ng erm S#ra#egy $& rea#ing C$$d=ill &$r be##er re#urns ,nnual rade (hibi#i$ns c$s#s

Management Structure

40

-xhibit 4@" (ead Co!nt in Different Departments +epartent

inan,e " *noi,in'

&ar!etin' " $R&

4ea $ount ?+ire,t Eployees; $ontra,t Eployees

3 2

5 1

(otal u/er of Eployees ?*n,luin' G&;

-xhibit 6"

-xhibit 64"

&aterial &ana'eent " o'isti,s 2 1

R"+ Support

4R

1 1

2 1

20

#P-RATI/ !#D-(

-valuation of !anufacturing Alternatives

2actors

Imlementatin time Investment &rd'ctin cst Inventr" cst /l'me lei+ilit" *ase  *it =Cntin.enc"> Imrt tari C-rdinatin +et)een

Produce in Singapore and

)ew Production *acility in

ship *inished goods to

Canada

Canada ) ) ) %i.# ) *as" 0 *as"

%i.# %i.# %i.# ) %i.# iic'lt -$!iic'lt

 and &rd'ctin

-xhibit 66"

-valuation of Distribution Alternatives

41

2actors Investment (easi+ilit" es'rces reJ'ired Mar.ins r ra.nCare !dministratin are#'se reJ'iredS

-xhibit 67"

Selling directly to retailers %i.# ) %i.# %i.# Cmle Fes

Selling to distri,utors ) %i.# ) ) *as" $ =Dse distri+'trs>

-valuation of Retail Alternatives

2actors

Setting up
!se o* Existing %etailer

Investment Imlementatin Time (easi+ilit" es'rces reJ'ired Mar.ins r ra.nCare !dministratin

Chain o* %etail Stores %i.# %i.# %i.# %i.# %i.# Cmle

)etwor1 ) ) Medi'm ) ) *as"

-xhibit 68"

Pro,ect Implementation antt Chart

42

-xhibit 6<" S0)o 1<

Responsibilities for Pro,ect Implementation Activities

Activity Mana.ement Team %irin.

%esponsi,ility Er' C#airman, /&- ales  etail, EM

Incrratin &rd'ct icensin. Caacit" *ansin #iin. 'lier 'rcin.

Canada EM Canada EM Canada ,  Crdinatr /& - Man'act'rin. &'rc#asin. %ead, in.are  .istics

'rcin. Canadian istri+'tr

Mana.er EM Canada, Marketin. Mana.er 

7< 8<

ite icensin. Marketin. &lannin.  &rmtin

.istics Mana.er .istics Mana.er Marketin. Mana.er  EM Canada

9<

!ctivit" e+site evelment  %stin.

Marketin. Mana.er

2< 3< 4< 5< 6<

-xhibit 6="

(ong Term Strategy Roll #ut Plan

43

-xhibit 6>"

3perating Expenses

OP$0"TIN1 $2P$NS$S 2igures in ###s of S', Salaries " 4ealth )enefits #inistration E.penses ) ravel ) raining ) &&ice Sulies ) &&ice ain#enance ) &&ice /ease (otal General " #in E.peniture

2005 340

2006 804

2007 1082

2008 1446

2009 1703

2010 1983

50 50 5 5 50 500

60 60 6 5 65 1000

60 70 7 6 75 1300

70 80 8 6 90 1700

80 100 10 7 100 2000

100 100 10 7 100 2300

Financial Per-ormance !hibits:

=!ll i.'res in 000s  in.are @>

-xhibit 6?"

44

DragonCare Canada Pvt Ltd Forecasted Income Statements Yearly Sales Growth upto 2010

75%

Sales Growth in 2010

35%

% of Sales 100% 6%

2005E 0.0 0.0

2006E 5000.0 300.0

2007E 8750.0 525.0

2008E 15312.5 918.8

2009E 26796.9 1607.8

2010E 36175.8 2170.5

Gross &ar'in (ransportation $ost SG# E)*(+#

94% 4% 80% 10%

0.0 0.0 800.0 )800.0

4700.0 200.0 5000.0 )500.0

8225.0 350.0 7000.0 875.0

14393.8 612.5 12250.0 1531.3

25189.1 1071.9 21437.5 2679.7

34005.2 1447.0 28940.6 3617.6

+epre,iation E)*(

4%

0.0 )800.0

200.0 )700.0

350.0 525.0

612.5 918.8

1071.9 1607.8

1447.0 2170.5

Sales $GS

*nterest 0.0 108.8 190.3 333.0 582.8 786.8 -)( " &inority *nterests )800.0 )808.8 334.7 585.7 1025.0 1383.7 &inority *nterests )153.6 )155.3 64.3 112.5 196.8 265.7 -)( )646.4 )653.5 270.4 473.2 828.2 1118.0 (a.es -aya/le on -rofit )245.6 )248.3 102.8 179.8 314.7 424.9 (a. $oer fro preious Year 0.0 245.6 494.0 391.2 211.4 0.0 #,tual (a.es -ai 0.0 0.0 0.0 0.0 103.4 424.9 (a. $oer $arrie er 245.6 494.0 391.2 211.4 0.0 0.0 -#( )400.8 )405.2 270.4 473.2 724.8 693.2 : 1 Sales are based $n *rag$ncare;s rice #$ re#ailers. e#ailer margins are ab$ve #his rice. 2 +i(ed ,sse#s *ear#men#al $ns$lida#i$n $& #he ?SS ,-++ 2005


Sales !rice is ad"us#ed #$ acc$mm$da#e ar# $& #rans$r#a#i$n c$s#. '2.5 milli$n marke#ing e(ense in 2006 4% $& Sales based $n assum#i$n #ha# *ee( is 10% $& +i(ed ,sse#s -n#eres# a#e 7.5%. !rime /ending a#es $& $s# Singa$re anks is ar$und 5.5% 19.2% in. -n#eres#. +r$m 2004 a(es 38% anadian

-xhibit 6@" Sensitivit3 "nal3sis of Income from DragonCare Canada

-rofits in 000;s $& SC' Sales Growth Rates

2005E 2006E 2007E 2008E 2009E 30% )400.8 )405.2 200.9 261.2 339.5 D0% )400.8 )405.2 216.3 302.9 424.0 50% )400.8 )405.2 231.8 347.7 521.5 60% )400.8 )405.2 247.2 395.6 633.0 80% )400.8 )405.2 278.2 500.7 756.8 90% )400.8 )405.2 293.6 557.9 827.5 $#e: Sales in 2006 =ill be '5 milli$n in all scenari$s. his is a c$nserva#ive & igure given #ha# #he marke# siIe i#sel& is ' 213 milli$n and is gr$=ing a# 20% er annum.

-xhibit 7" Operating Cash Flow for Canadian Operations et *n,oe #< +epre,iation ess< (a.es ,arrie forwar *n,rease in #R

*n,rease in *nentory *n,rease in ther $urrent #ssets #< *n,rease in $urrent ia/ilities et $ash low fro perations

2005E )400.8 0.0

2006E )405.2 200.0

2007E 270.4 350.0

2008E 473.2 612.5

2009E 724.8 1071.9

245.6 0

248.3 438.36

0 328.77

0 575.34

0 1006.85

0 0 0

917.81 57.53 750.00

688.36 43.15 562.50

809.08 75.51 984.38

1415.88 132.15 1722.66

)646.4

)1117.2

122.7

610.2

964.5

2010 E 693.2 1447.0


0 822.26 32 *ays receivable 67 *ays inven#$ry u#$ 2007. educed #$ 45 days a&#er #ha# since =e =ill have be##er 1156.30 e(erience by #hen 107.92 4 *ays $#her curren# asse#s 1406.84 15% $& sales similar #$ curren# levels 1460.6

-xhibit 74"

45

Net Cash Flow Projections for Canadian Operations 2005E 2006E 2007E 2008E 2009E 2010 E et $ash low fro perations )646.40 )1117.17 122.65 610.19 964.48 1460.57 et $ash low in *nestents 0.00 )1450.00 )1087.50 )1903.13 )3330.47 )2719.88 $ash low fro inan,in' 0.00 1450.00 1087.50 1903.13 3330.47 2719.88 E( $#S4  )646.40 )1117.17 122.65 610.19 964.48 1460.57 $#e:ash &l$= in inves#men#s in &u#ure years =ill be l$= due #$ sl$=er average gr$=#h $& ar$und 5)10%. enceA cash &l$=s &r$m $era#i$ns in &u#ure years =ill be s#eady and su&&icien# #$ c$ver any &u#ure inves#men# reBuiremen#s Cr$=#h =ill sl$= d$=n because *rag$nare =$uld have c$mle#ed i#s ge$grahic and r$duc# line e(ansi$ns by end $& 2010.

-xhibit 76" N$T P0$S$NT -"L4$ OF D0"1ONC"0$ C"N"D" PL"N in 000;s SC* evenues - /ess: a(es $n - e# era#ing !r$&i# ,&#er a(

2005

0 )800 )304 )496

2006 5000.00 )700.00 )266.00 )434.00

2007 2008 2009 2010 2011 2012 2013 201D 2015 2016 (erinal @alue 8750.00 15312.50 26796.88 36175.78 39793.36 43772.70 48149.96 52964.96 58261.46 61174.53 525.00 918.75 1607.81 2170.55 2387.60 2626.36 2889.00 3177.90 3495.69 3670.47 199.50 349.13 610.97 824.81 907.29 998.02 1097.82 1207.60 1328.36 1394.78 325.50 569.63 996.84 1345.74 1480.31 1628.34 1791.18 1970.30 2167.33 2275.69 23894.77

ree $ash low $al,ulation !, !lus: *erecia#i$n Cr$ss ash +l$= /ess: -ncrease in E$rking a /ess: a. (endi#ure +ree ash +l$=s !O $& ash +l$=s

)496 0 )496 0 0 )496 )496

)434.00 200.00 )234.00 663.70 1450.00 )2347.70 )2134.27

325.50 569.63 996.84 350.00 612.50 1071.88 675.50 1182.13 2068.72 497.77 475.56 832.22 1087.50 1903.13 3330.47 )909.77 )1196.56 )2093.97 )751.88 )898.99 )1430.21

-@ of -roEe,t

1345.74 1447.03 2792.77 679.65 2719.88 )606.76 )376.75

1480.31 1591.73 3072.05 1233.59 1049.10 789.36 445.57

1628.34 1750.91 3379.25 1356.95 1154.01 868.29 445.57

1791.18 1926.00 3717.18 1492.65 1269.41 955.12 445.57

1970.30 2118.60 4088.90 1641.91 1396.35 1050.63 445.57

2167.33 2330.46 4497.78 1806.11 1535.98 1155.70 445.57

2275.69 2446.98 4722.67 1896.41 844.79 1981.47 694.49

5209

"ss!mptions *ade 0emar+s Sales Cr$=#h a#e u#$ 2009 75% ,ggressive sales gr$=#h es#im a#e due #$ lans $& e(ansi$n #hr$ugh r$duc# launches and ge$grahic e(ansi$n Sales Cr$=#h in 2010 35% Sales Cr$=#h &r$m 2010)2015 10% Sales gr$=#h es#ima#e is l$=er due #$ n$ ma"$r gr$=#h drivers > increased c$me#i#i$ n. #ssuptions for (erinal @alue $al,ulation !, Cr$=#h a#e bey$nd 2016 5% arke# #$ reach ma#uri#y and s#i&& c$me#i#i$n e(ec#ed. Eeigh#ed ,verage $s# $& ai#al 10% -n #he /$ng unA *erecia#i$n  ai#al (endi#ure -n #he /$ng unA E$rking ai#al hange  0

-xhibit 77"

/P& Sensitivity ' R#I Calculations

Sensitivit3 "nal3sis for NP- of DragonCare Canada Project

#$$

-@ 5209F21 0F07 0F08 0F09 0F10 0F11 0F12 0F13

0F01

(erinal %-#( Growth Rates 0F02 0F03 0F0D

0F05

0F06

12831.04

12985.49

13139.94

13294.39

13448.84

13603.30

9 40 1.1 4

9 523 .1 4

96 45. 14

9 767 .1 4

9 88 9.1 4

1 00 11 .14

6 84 4.4 1

6 942 .4 0

70 40. 39

7 138 .3 8

7 23 6.3 7

7 33 4.3 6

4 89 0.1 7

4 969 .9 3

50 49. 69

5 129 .4 5

5209F21

3 36 6.9 5

3 432 .5 9

34 98. 23

3 563 .8 7

3 62 9.5 1

3 69 5.1 5

2 16 1.1 2

2 215 .6 4

22 70. 15

2 324 .6 7

2 37 9.1 9

2 43 3.7 1

1 19 4.5 2

1 240 .1 6

12 85. 79

1 331 .4 3

1 37 7.0 6

1 42 2.7 0

5288.98

56 7ear 0et!rn on Initial Investment -rofit #fter (a. -@ of -rofits (otal -@ of -rofits *nestents Return on *nitial *nestent in 5 years

2005 2006 2007 2008 2009 2010 )400.768 )405.1514 270.4275 473.2481 724.8281 693.1902 )400.768 )368.3195 223.4938 355.5583 495.0673 430.4166 305.032 2113.70 1DFD3%

46

8374.97

-xhibit78"

-xhibit 7<"

47

-xhibit 7="

-xhibit 7>"

Forecasted Income Statements of Non6Canadian DragonCare Operations % of Sales Sales

2005E

2006E

2007E

2008E

2009E

2010E

Rear!s

133061.30

150000.00

165000.00

181500.00 199650.00 219615.00 Sales Cr$=#h 10% bey$nd 2006

Gross Re ?p Re;

85.95%

114359.79

128917.80

141809.58

155990.53 171589.59 188748.54 ased $n urren# % $& Sales

SG#

73.33%

97578.64

110000.40

121000.44

133100.48 146410.53 161051.58 ased $n urren# % $& Sales

E)*(+#

12.61%

16781.16

18917.40

20809.14

22890.05

25179.06

27696.96 ased $n urren# % $& Sales

+epe.

2.89%

3848.77

4338.72

4772.59

5249.85

5774.84

6352.32 *ee( is 10 % $& +i(ed ,sse#s

E)*(

9.72%

12932.39

14578.68

16036.55

17640.20

19404.22


*nterest

1.95%

2595.61

2926.03

3218.63

3540.50

3894.54


-)( " &inority inter

7.77%

10336.78

11652.65

12817.91

14099.71

15509.68


8499.30

26% a(es > 19.2 % in$ri#y -n#eres#.in$ri#y -n#eres# 9349.23 calcula#ed &r$m 2004 -
% $& Sales based $n assum#i$n #ha#

-#(

5664.55

6385.65

7024.22

7726.64

48

-xhibit 7?"

Forecasted Consolidated Income Statements 2005E 133061.30 114359.79 98378.64 15981.16 3848.77 12132.39

Sales Gross Re ?p Re; SG# E)*(+# +epe. E)*(

*nterest -)( " &inority interests -#( +iienBShare +iien *n,rease in RetF Earnin's (E< he c$ns$lida#ed -nc$me s#a#emen# is made

2006E 155000.00 133617.80 115200.40 18417.40 4538.72 13878.68

2007E 173750.00 150034.58 128350.44 21684.14 5122.59 16561.55

2008E 196812.50 170384.28 145962.98 24421.30 5862.35 18558.95

2009E 226446.88 196778.65 168919.90 27858.74 6846.71 21012.03

2595.61 3034.78 3408.94 3873.54 4477.38 9536.78 10843.90 13152.60 14685.41 16534.66 5263.79 5980.50 7294.64 8199.89 9224.13 0.80 0.80 0.80 0.80 0.80 1777.60 1777.60 1777.60 1777.60 1777.60 3486.19 4202.90 5517.04 6422.29 7446.53 based $n 10% gr$=#h &$r $n)anadian $era#i$ns bey$nd 2006

2010E 255790.78 222753.78 191439.24 31314.54 7799.35 23515.19

5070.82 18444.37 10042.42 0.80 1777.60 8264.82

-xhibit 7@"

Forecasted Consolidated &alance Sheet 2005E

2006E

2007E

2008E

2009E

2010E

$ash

14280.86

14864.81

15355.95

16332.34

15994.74

16622.70


#R

10936.54

12739.73

14280.82

16176.37

18612.07

21023.90

*nentories

12898.52

14068.49

16071.92

17800.17

20807.29

23713.95

ther $urrent #ssets (otal $urrent #ssets

1531.12 39647.05

1783.56 43456.59

1999.32 47708.01

2264.69 52573.57

2605.69 58019.78

2943.35 64303.89

i.e #ssets (otal #ssets

40037.78 79684.82

44950.00 88406.59

50387.50 98095.51

57075.63 109649.20

65669.59 123689.38

74179.33 +i(ed ,sse#s< Sales  0.29. Same as $& n$=. 138483.22

$urrent ia/ilities

19959.19

23250.00

26062.50

29521.88

33967.03

38368.62

on' (er ia/ilities Euity E

10009.44 49716.19 79684.82

11237.50 53919.09 88406.59

12596.88 59436.13 98095.51

14268.91 65858.42 109649.20

16417.40 73304.95 123689.38

18544.83 81569.77 138483.22

*ays eceivables  30 days. ? 2 days &r$m curren# -nver#$ry *ays  32 &$r $n)anadian $era#i$ns > 67 days &$r anadian $era#i$ns u#$ 2007 and 45 days a&#er 2007 #her urren# ,sse#s  4 *ays $& Sales. Same as urren#

15% $& Sales. Similar #$ curren# levels / /iabili#ies < +i(ed ,sse#s remains c$ns#an# a# curren# level $& 0.25

-xhibit 8"

0atio "nal3sis for DragonCare Ltd (#BEuity SalesB#ssets -#(BSales RE -rofit Growth +e/tBEuity $urrent Ratio Hui,! Ratio E)*(B*nterest

2005E 1.60 1.67 0.04 11% 13% 0.60 1.99 1.26 4.67

2006E 1.64 1.75 0.04 11% 14% 0.64 1.87 1.19 4.57

2007E 1.65 1.77 0.04 12% 22% 0.65 1.83 1.14 4.86

2008E 1.66 1.79 0.04 12% 12% 0.66 1.78 1.10 4.79

2009E 1.69 1.83 0.04 13% 12% 0.69 1.71 1.02 4.69

49

2010 E 1.70 1.85 0.04 12% 9% 0.70 1.68 0.98 4.64

-xhibit 84"

Consolidated Cash Flow Statement 2005E %perations et *n,oe #< +epre,iation ess< *n,rease in #R *n,rease in *nentory *n,rease in %ther $urrent #ssets #< *n,rease in $urrent ia/iliti

2006E

2007E

2008E

2009E

2010 E

5263.79

5980.50

7294.64

8199.89

9224.13

10042.42

3848.77

4538.72

5122.59

5862.35

6846.71

7799.35

1876.14

1803.18

1541.10

1895.55

2435.70

2411.83

2026.04

1169.97

2003.42

1728.25

3007.11

2906.66

81.45

252.45

215.75

265.38

341.00

337.66

2106.19

3290.81

2812.50

3459.38

4445.16

4401.59

$ash low fro %perations

7886.51

10584.43

11469.46

13632.43

14732.18

16587.22

*nestents *n,rease in i.e #ssets $ash flow fro *nestents

)9461.55

)9450.94

)10560.09

) 12550.48

)15440.68

)16309.08

)9461.55

)9450.94

)10560.09

)12550.48

)15440.68

)16309.08

inan,in' *n,rease in on' (er ia/ilities ess< +iien $ fro inan,in' )e'innin' $ash et $ash low Enin' $ash

2774.44

1228.06

1359.38

1672.03

2148.49

2127.4

)1777.60

)1777.60

)1777.60

)1777.60

)1777.60

)1777.60

996.84

)549.54

)418.23

)105.57

370.89

349.83

14859.056

14280.9

14864.8

15356.0

16332.3

15994.7

)578.19

583.94

491.15

976.39

)337.60

627.97

14280.86

14864.81

15355.95

16332.34

15994.74

16622.70

-xhibit 86"

50

-xhibit 87"

-xhibit 88"

&rea+even Sales Calc!lation 2005 i.e $osts *erecia#i$n inimum arke#ing (enses verheads SC, $#al +i(ed $s#s @aria/le $osts a#l F rans$r# s Cnits; )rea!een Sales ?000>s SG+; E$men;s  arke# SiIe e&$re *is#ribu#$r and e#ailer $mmissi$ns )rea!een &ar!et Share

'

2006

2007

2008

2009

2010

200.0 2500 1000 3500 3700.0

350.0 3950.0 1300 5250.0 5600.0

612.5 7487.5 1700 9187.5 9800.0

1071.9 14078.1 2000 16078.1 17150.0

1447.0 19405.5 2300 21705.5 23152.5

2.5 5 7.50 '

'

17.50 ' 211FD3  5:285F71  126951 DF2%

2.5 5 7.50 '

2.5 5 7.50 '

2.5 5 7.50

17.50 ' 17.50 ' 17.50 ' 320F00 560F00 980F00 8:000F00  1D:000F00  2D:500F00 

17.50 1323F00 33:075F00

152341 5F3%

2.5 5 7.50 '

175193 8F0%

197968 12FD%

217764 15F2%

51

ANNEXURE:

ADDITIONAL LIST OF SOURCES

TRADE FACILITATION OFFICE CANADA

56 Sparks Street, Suite 300 Ottawa, Ontario, Canada K1P 5A9 Tel: 613! 233"3925 #n Canada: 1"$00"26%"96%& 'a(: 613! 233"%$60 e")ail: t*o+t*o+-+a internet site: www-t*o+-+a DEPARTMENT OF FOREIGN AFFAIRS AND INTERNATIONAL TRADE

#n*or)ation Ser.i+es S/C#! 125 Susse( ri.e, Ottawa, Ontario K1A 02 Tel: 1"$00"26%"$3%6 'a(: 1"613"996"9%09 e")ail: enser.d*ait")ae+i-+-+a 'or e")ail reuests, please in+lude 4our na)e, telepone nu)er and return addressinternet site: ttp:77www-d*ait")ae+i-+-+a CANADIAN ASSOCIATION OF IMPORTERS AND EXPORTERS

&3$ 8ni.ersit4 A.enue, Suite 161$ Toronto, Ontario, Canada 5 2K Tel: &16! 595"5333 'a(: &16! 595"$226 internet site: www-+aie-+a CANADIAN GENERIC PHARMACEUTICAL ASSOCIATION

Head Office

&120 ;one Street, Suite &09 Toronto, Ontario, Canada 2P 2$ Tel-: &16! 223"2333 'a(: &16! 223"2&25 Montreal Office

11$0 ru))ond, Suite &00 ontreal, 3 2S1 Tel-: 51&! 393"3%2$ 'a(: 51&! 393"102& internet site: www-+d)a"a+*pp-or CANADIAN HEALTHCARE ASSOCIATION

1% ;ork Street Ottawa, Ontario, Canada K1? 9@6 Tel: 613! 2&1"$005 'a(: 613! 2&1"5055 internet site: www-+a-+a CANADA CUSTOMS AND REVENUE AGENCY

internet site: www-++ra-+-+a7tari**

52

ANNEXURE:

ADDITIONAL LIST OF SOURCES

CANADIAN HEALTH FOOD ASSOCIATION

550 Alden oad, Suite 205 arka), Ontario, Canada B3 6A$ Tel: 905! &%9"6939 'a(: 905! &%9"1516 internet site: www-+*a-+a CANADIAN HOMEOPATHIC PHARMACEUTICAL ASSOCIATION

&0$
Par)a+euti+al anu*a+turers Asso+iation o* Canada! 55 et+al*e Street, Suite 1220 Ottawa, Ontario, Canada K1P 6B5 Tel: 613! 236"0&55 'a(: 613! 236"6%56 internet site: www-+anadapar)a-or HEALTH CANADA

A-B- 0900C2 Ottawa, Ontario, Canada K1A 0K9 Telepone: 613! 95%"2991 'a(: 613! 9&1"5366 internet site: www-+"s+-+-+a >as links to te Canadian #nstitute *or >ealt #n*or)ation under te Health Care se+tion www-+ii-+a! INDUSTRY CANADA

Co))uni+ations and arketin ran+ Se+ond 'loor, Dest Tower 235 5 internet site: www-strateis-i+-+-+a Trade ata Online! NON-PRESCR IPTION DRUG MANUFACTURERS ASSOCIATION OF CANADA

1111 Prin+e o* Dales ri.e, Suite &06 Ottawa, Ontario, Canada K2C 3T2 Tel: 613! %23"0%%% 'a(: 613! %23"0%%9 internet site: www-nd)a+-+a PATENTED MEDICINE PRICES REVIEW BOARD

o( B&0, Standard Bi*e Centre 333 Baurier A.enue Dest, Suite 1&00 Ottawa, Ontario, Canada K1P 1C1 internet site : www-p)pr"+ep)-+-+a

53

Business Plan (Richard Ivey) - Cerebration05

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