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Inventory management system Forecast NOW!

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  • 1. I n v e n t o r y m a n a g e m e n t s y s t e mf o r S M BAn experienced manager for any goodsCEOAlexander GritsayFor Startup VillageResident1
  • 2. Project goals1. Commercialization of desktop-version2. Creation of SaaS - version2
  • 3. ProblemInefficient use of floating assets:commodity deficiency, unhappy clientsexcessive inventorylow turnoverloosing ~43% of profit per yearIndustry looses– $196 bln per yearexisting solutions for SMB are not effectivestaff of analysts requires big costs3
  • 4. SolutionImplementation of innovative automateinventory management systemForecast NOW!:* Forecast accuracy increases at 20% compared with other algorithms dueto used neural networks and genetic optimizationDemandforecasting*Optimal stockcalculationrelease of up to 40% of floating assetsreduction stock level up to 75%reduction of safety stockprogram replaces 5 analysts4
  • 5. Technology description5Forecast NOW!Effective Tool,accessible for non-specialistsBase technology–neural networksand genetic algorithmsAlgorithmINTERDEMAND©Automatic selectionof forecastingmethodAlgorithmOPTIGEN©Automaticselection of optimalmathematic modelsparameters
  • 6. Product descriptionNew, intuitive clear inventory management system(SCM – Supply Chain Management)Effectiveeasily integrates with 1С, SAP, Oracle, Microsoft Dynamicssaves to 10x more than its costdoesn’t require special knowledgeworks with intermittent demandforecast with high accuracy(20-100% better then competitive solutions)Automaticautomatically takes into account the additional factors(weather, currency rates, conjugate sales)automatically select optimal forecasting modeltakes in account additional external constraints 6
  • 7. SCM-applications market$1.3$1. 2$0.4$0.2$0.1$3.6Companies, bln. $ SAPOracleJDAManhattanAssociatesRedPrairieПрочие7Potential world market of our system is$0.67 bln,as such applications take 10%, wholeSCM market $6.7 bln. ** - www.idc.com , 2011$3.3$2.2$0.2$1.0Regions, bln $USAEULatin AmericaOther
  • 8. Market for Forecast NOW!8We know our consumer– SMB, Wholesale and retail trade enterpriseswith more then 2’000 SKU and storage volume from $200K, our worldmarket$670 mln.SCMSCP PlanningDemandforecastInventorymanagementReplenishmentmanagementSCE ExecutionExecution DeliveryForecast NOW!performs at least 25% functions55%45%Market SCM $6.7 blnLargeSMB
  • 9. Russian Market9First year – Russian and CIS Market,Inventory management systems sales in Russia $67 mln. per year.Second year – entry on world market. Expected turnover in three years$6,7 mln. per year.1С takes near 80% market forSMB in Russia1С hasn’t such functionalityForecast NOW! easily integrateswith 1С and saves 10х more thancostsconsumers confirmed ForecastNOW! efficiencyForecast NOW! takes 3%Russian market in 3 years$2mln. per year
  • 10. Competitive advantagestypical representatives SMB TOP-10 in Russia and worldФакторForecastNOW!Goods4CastDeductorISOLokadForecast accuracyInitial price (K$.) 4 47 53 16Implementation(months)0.5 2 3 1RequiredknowledgeGeneral Special Special SpecialSaaS-versionDecision support10
  • 11. Business modeldevelopment, selling, implementation, support of software11Start versionDownload from siteRestricted numberof forecastsEscalating customerbaseDesktopLicenseSubscription feeImplementationConsultingSaaSPay for forecastService subscriptionConsulting
  • 12. Investments WorksAmount SourceR&D;tests;pilot implementations;certificate on program ;$13K$33Kdesktop-version;4 paid implementations (amount - $25K)interest from 50 companiesstart work on SaaS-version.Completed12
  • 13. Financial performancesIndex ValueInvestments $0.4 mln.Investor NPV (40%, 3 years), $1.7 млн.IRR (3 years) 155%break-even point 9 monthspayback period 20 monthsInvestor ROI (3 year) 5,1х13
  • 14. 14Discount rate 40% Investor share 35% P/S 2,5Yr 0 Yr 1 Yr 2 Yr 3 Exit Yr 3Sales, k RUR 7 580 40 848 200 648 501 620CF, k RUR (2 110) 14 813 66 527Disc factor 0,71 0,51 0,36 0,36DCF, k RUR (10 534) (1 507) 7 558 24 244 182 806DCF, k USD (334) (48) 240 770 5 803Investor CF, k USD -334 0 0 5 574ROI (discounted) 5,07 ROI (simple) 15,67IRR 155%Investor NPV, k USD 1697Financial performances
  • 15. Plan of product realization15Jan.’15 Jan.’165 clients 95clients238 clients1’005clientsDesktopSalesEntry on worldmarketSaaSSalesJune.’14June.’13
  • 16. Expenditure patternSalary47%Taxes7%Advertising10%SaaS costs15%Contingencies9%Other12%$1,3 mln per 3 years(investments and reinvested profit)16
  • 17. Team17Business• GrigorievAlexey, strategy• ViktorovEvgeny, CFO• RayevskyMaxim, SalesTechnology• VarankinDmitry, CTO• SorokinSergey, Directorof R&DDevelopment• GritsayAlexander, CEOForecastNOW!MSc ITPhD ITMSc ITMScEconomicsPhDEconomicsMSc IT
  • 18. Thank you for attention!Address: Russia, Tver, Universitetskyper., 9а, of. 126.Tel: +7 (4822) 79-02-25E-mail: info@forecastnow.ruWebsite: www.forecastnow.ruпрогнозируйсейчас.рфFor Startup VillageContacts:18