! NSG is developing & incubating a portfolio of Luxury Infant Formula & Nutrition Brands for Asia

Transcription

1 NSG is developing & incubating a portfolio of Luxury Infant Formula & Nutrition Brands for Asia

2 ABBOTT CEO: China is the largest and fastest growing nutritional market in the world... 1 MORGAN STANLEY: 1 China drives 60% of worldwide nutritional market growth 2

3 The China Infant formula Market is in Hyper-Growth.. Since 2008 Numerous Quality Scandals have led to an 800% increase in Infant Formula imports 1 1 3

4 DEMAND Chinese Consumer seeks strictly imported formula Demand change to foreign Organic products Large price premium to foreign markets

5 -NSG BUSINESS SUMMARY- China and SE Asia luxury Mother & Baby Nutrition markets will continue to grow at hyper rates in the future. The opportunity exists in Asia s increased demand for Organic products. Objectives: Establish premium Mother & Baby Organic Nutrition Brand Rollout of Retail Kiosks across Pharmacies, Recovery Centers, Premium Supermarkets & Baby Stores Develop Membership based E-Commerce Platform

6 Initial Wholesale Business Model Partner with established and qualified IF and Pharmaceutical distributors seeking to add a premium luxury product into their portfolio. Working with distributors initially creates scalability of the business. NSG provides: 1) Organic Brand & Traditional IF Brand 2) Retail Kiosk Sales Platform 3) Online Marketing Support

7 The Numbers: Importing and selling to distributor (Based on a RMB 288/ USD 47 Retail Price) 20ft Container Margin Analysis Dutch Product (wholesale) 20,000 Boxes Per Unit 1 1 Production Costs $160,000 $8.00 VAT 17.5 % $28,000 $0.71 Trade Duty 15% $24,000 $1.20 Logistics Costs $9,524 $0.48 Total Landed Import Cost Total Profit per 4 Container $221,524 $10.39 Wholesale Cost $352,000 $ % Margin $130,476 $7.21

8 The Numbers: Year 1 +2 Wholesale Sales Forecast Assumptions based on discussions with former Bellamy s Organic distributors interested in Stork Nutrition & MooBaby Dutch products. Jul 14 Aug 14 Sep 14 Oct 14 Nov 14 Dec 14 Jan 14 FY 2014 FY 2015 Fy ft Containers Total Revenue $352,000 $352,000 $1,056,000 $1,056,000 $1,056,000 $1,056,000 $1,056,000 $5,984,000 $16,896,000 $42,240,000 Cost of Sales $221,524 $221,524 $664,572 $664,572 $664,572 $664,572 $664,572 $3,765,908 $10,633,152 $26,582,880 Gross Margin $130,476 $130,476 $391,428 $391,428 $432,600 $391,428 $432,600 $2,218,092 $6,262,848 $15,657,120 Revenue m

9 2013 Development Milestones Consumer Research/ Focus Groups by leading Agency Brand Creation & Package Design Establish local QA/QC Logistics Team Created partnerships with OEM Production partners Establish Regional China Distributors Finalized product Nutritional characteristics in accordance with CIQ guidelines.

10 FORMING THE CHINA STRATEGY: Hire the Best Market Assessment : Conducted focus groups and market research studies Provided brand positioning strategies Compiled a comprehensive look at the Chinese attitudes towards milk products & online retail market Looked into strategies into penetrating this market 1 Brand creation: Same Agency responsible for Watsons Private Label Brand Came up with the brand name and logo for our new venture: Stork Nutrition Designed the packaging for all products Advised NSG on the brand personality and overall look and position in the China market

11 a solution A revolutionary new system of nourishment & personal care for mother and child

12 Luxury Experience China s increasingly affluent consumer wants more than just an imported infant formula from their supermarket shelf. Pre-and post-natal nutrition is priced as a luxury offering in Greater China. Why shouldn t the product also be luxury?

13

14 Taking a confusing market and simplifying for the consumer PREGNANCY INFANT TODDLER 9-10 months 0-1 year old 1-3 years old The Consumer wants to feel SAFE that they are being delivered the right products.

15 Brand Thesis There is a desire by the Greater China consumer for a high quality & trusted brand which creates a more holistic and service oriented approach to the segment. By providing packages of expert selected Organic products covering all requirements of pregnancy, consumers will gain a deeper relationship with the brand through knowledge.

16 KIOSK Retail Outlets (Phase 1) (partner with Distributors on a province by province basis) Beijing/ Shanghai Kiosks stationed in high end retail malls, pharmacies, recovery centers Roll out of Kiosks around Tier 2/3 cities throughout 2014 with exclusive province distributors. Provide STORK KIOSK equipment, sales training and uniforms to distributors.

17 Our Research shows China Mothers want a product they can not only trust, but makes them feel like a Hot Mom

18 E-Commerce Site (Phase 2) Full featured e-commerce site currently under development Logistics to be based in the Hong Kong & Shanghai Free Trade Zones depending on product.

19 High Quality Monthly Packages Health and personal care packages are delivered monthly by Stork s Ecommerce store for both mother and baby containing everything they need in a single box

20 Online: And through Select Partners: T-MALL We are in advanced negotiations with online marketing agents who focus on infant formula and guarantee Stork access to their targeted customers. Stork intends to ultimately open it s own Tmall store in Q3 by the end of the year with direct access to customers.

21 Phase 3 (Long Term Goals) Flagship Retail Stores Appoint Celebrity Mother in 2015

22 China Trading Business NSG is currently partnering with Chinese distributors to sell its Dutch Moo Baby IF and Eiffel Milk UHT Milk offerings through a wholesale trading model in order to establish cash flow in Q42013.

23 Key Team Members Jamon Alexander Rahn CEO In China since 2007, he focused on inbound and outbound related investments. In 2009, he founded a back-end support and market entry services company for Private Equity firms coming to China. He then started Emerging Asia Capital which advises and makes investments into Natural Resource companies using Chinese strategic capital. James A. C. Foster COO An alumnus of Stanford University and the School of Oriental & African Studies, he began his career in the City of London with RBC and ING. Subsequently he moved to Beijing to co-found Emerging Asia Capital. Spring Ren- Vice President, Logistics Previously, Spring worked in the logistics team for UPS China. She comes to NSG by way of its acquisition of Logico Bio-Products where she supervised the day to day logistics and creation of its ERP system. Patrick Lai- Vice President, Quality Control Patrick has worked for SGS in its product testing division and is instrumental in establishing best practices for NSG s Quality Control and Analysis program. He joined NSG through the Logico Bio-Products acquisition. Alexander Smayda - Head of China Government Affairs With over 20 years in Greater China, Alex combines a successful track record building and restructuring business in China with a unique insight into China government operations. He has built an extensive network of key government and private company relationships throughout China. Alex is co-founder and managing director of Poly Capital Partners, a Shanghai based private equity firm focused on growth capital investment.

24 Contact Us Shanghai Office Level 5 Xintiandi 159 Madang Road Shanghai, China Telephone: (+86) Facsimile: (+86) Singapore Office Natural Source Group Pte Ltd. 10 Anson Rd. International Plaza Singapore, Telephone: (+65) JR@NaturalSourceGroup.com