Fighting for a Healthier, Happier, Tomorrow
FEASIBLE Comment by Michele: Since the analysis is not yet complete, it is too soon to determine this.
Healthy Hands, LLC
Business Feasibility Study
Eric Reinert
Yagiz Over
Benadeta Burroughs
Tuan Huynh
An Nguyen
Raymond Dharmadipraja
Drexel University
August 7th, 2013
Why the blank page?
Table of Contents
Executive Summary 5
Business Concept 6
Industry Analysis 7
S.W.O.T. Analysis 7
Market Analysis 10
Market Size, trend and growth 10
Product Distribution and Sales 10
Estimated Market Share and Sales 11
Founding Team 12
Product/ Service Development Plan 13
Financial Plan 15
New Venture Development Timeline 16
Appendices 17
Why the blank page above?Executive Summary Comment by Michele: Good! You are one of the very few teams that knew not to write this yet.
Business Concept
Methicillin-Resistant Staphylococcus Aureus, also known as MRSA, is the bacterial strain responsible for causing staph infections. There are approximately one million infections every year because of these bacteria. MRSA is also responsible for 20% of all hospital infections. The main mechanism for the transfer of these bacteria is through direct skin-skin contact. The contraction of this disease is not only painful and potentially life threatening, but it can lead to an extra five days in the hospital and an additional average of $6,400 in hospital fees. This is outrageous, especially considering the fact that the cause of the infection is usually due to improper hygienic practices by the hospital staff. There is an easy solution to preventing the spread of MRSA and most other diseases spread through skin-skin contact - washing your hands. Unfortunately it is nearly impossible to ensure that hospital employees are practicing proper hygiene, until now. Comment by Michele: Cite. Comment by Michele: Cite. Comment by Michele: Always put a blank line between paragraphs in a single-spaced document.
Healthy Hands is an innovative new way to help ease the on-going difficulty employers face, whilst trying to ensure their employees maintain a clean and safe environment. The best part is that hospitals are not the only businesses that can benefit from Healthy Hands. Restaurants, schools, and even households can all benefit from this service. The concept is simple. It is a wireless system set up within a series of soap and/ or hand sanitizer dispensers that keeps track of how often employees wash their hands. Using an innovative new identification wrist band, the Healthy Hands dispensers will wirelessly transmit the ID information provided by the wrist band to a wireless service. This service will keep track of the amount of times each employee washes, or sanitizes their hands in real time! This will provide a means by which employers can incentivize and monitor the hygiene of their employees. Comment by Michele: Don’t use exclamation points in business pa ...
Fighting for a Healthier, Happier, TomorrowFEASIBLE.docx
1. Fighting for a Healthier, Happier, Tomorrow
FEASIBLE Comment by Michele: Since the analysis is not
yet complete, it is too soon to determine this.
Healthy Hands, LLC
Business Feasibility Study
Eric Reinert
Yagiz Over
Benadeta Burroughs
Tuan Huynh
An Nguyen
Raymond Dharmadipraja
2. Drexel University
August 7th, 2013
Why the blank page?
Table of Contents
Executive Summary 5
Business Concept 6
Industry Analysis 7
S.W.O.T. Analysis 7
Market Analysis 10
Market Size, trend and growth 10
Product Distribution and Sales 10
Estimated Market Share and Sales 11
Founding Team 12
Product/ Service Development Plan 13
Financial Plan 15
New Venture Development Timeline 16
Appendices 17
Why the blank page above?Executive Summary Comment by
Michele: Good! You are one of the very few teams that knew
not to write this yet.
3.
4. Business Concept
Methicillin-Resistant Staphylococcus Aureus, also known
as MRSA, is the bacterial strain responsible for causing staph
infections. There are approximately one million infections every
year because of these bacteria. MRSA is also responsible for
20% of all hospital infections. The main mechanism for the
transfer of these bacteria is through direct skin-skin contact.
The contraction of this disease is not only painful and
potentially life threatening, but it can lead to an extra five days
in the hospital and an additional average of $6,400 in hospital
fees. This is outrageous, especially considering the fact that the
cause of the infection is usually due to improper hygienic
practices by the hospital staff. There is an easy solution to
preventing the spread of MRSA and most other diseases spread
through skin-skin contact - washing your hands. Unfortunately
it is nearly impossible to ensure that hospital employees are
practicing proper hygiene, until now. Comment by Michele:
Cite. Comment by Michele: Cite. Comment by Michele:
Always put a blank line between paragraphs in a single-spaced
document.
Healthy Hands is an innovative new way to help ease the
on-going difficulty employers face, whilst trying to ensure their
employees maintain a clean and safe environment. The best part
is that hospitals are not the only businesses that can benefit
from Healthy Hands. Restaurants, schools, and even households
can all benefit from this service. The concept is simple. It is a
wireless system set up within a series of soap and/ or hand
sanitizer dispensers that keeps track of how often employees
wash their hands. Using an innovative new identification wrist
band, the Healthy Hands dispensers will wirelessly transmit the
ID information provided by the wrist band to a wireless service.
This service will keep track of the amount of times each
5. employee washes, or sanitizes their hands in real time! This will
provide a means by which employers can incentivize and
monitor the hygiene of their employees. Comment by Michele:
Don’t use exclamation points in business papers.
Healthy Hands dispensers will also monitor and send out
alerts when soap runs low. We will also develop a large variety
of hand soaps and hand sanitizers for a multitude of uses from
kitchens, to hospitals, or even households. The distribution of
the product will be through a multitude of mechanisms,
including purchasing through our website or contacting us via
mail order, phone, or email. The beauty of this concept is that
we intend to take full advantage of repeat sales for the refilling
of our dispensers. This will allow us to maintain a strong and
loyal customer base.
One of the setbacks is the possibility of spin-offs, but we
intend to combat this threat by providing an excellent product
and service at an affordable cost. We also intend to patent our
ID bands, Tracker Software, and our easy easy-reload soap
cartridge system. This will deter any knock-offs from copying
our system of establishing a captive customer base which will
provide for Healthy Hands a steady and reliable source of
revenue to support production, advertising, free trials and
distribution costs. The price of the dispensers and ID bands
themselves will be close to the cost of their production. This
will give the dispensers an affordable price so they can be
purchased in large quantities and to allow Healthy Hands to
break even upon the sale of these units. The repeat sales from
the soap cartridges and the monthly cost of the Tracker
Software service will allow Healthy Hands to make a constant,
reliable, and steady source of revenue. Comment by Michele:
Why is this a setback? Because you can’t think of any potential
spin-offs? I don’t understand the issue.Industry Analysis
Healthy Hands is in a unique position that is quite rare for
many businesses. Healthy Hands’ suppliers will include the
suppliers of our soap dispensers, and wrist bands. The cost for
6. the production of hand soap dispensers is not high, even with
the wireless routers. Also, since our reload cartridges and the
soaps within them will be made by us, we will be able to
provide the dispensers at a reduced price, while still making a
profit through repeat sales of our cartridges as well as the small
monthly fee for our tracking service. This will significantly
lower the supplier power since the production of the dispensers
and wristbands is not very advanced and there are many
suppliers out there to choose from. Comment by Michele: Why?
And what industry are you entering? Comment by Michele:
But as a startup, most suppliers aren’t really going to let you
bargain.
The customer base also does not have very much power
considering the fact that if a restaurant or hospital wants to
maintain a good reputation with their customer base,they will
want to do everything in their power to maintain a clean
facility, which is why they will want our products and services,
especially with the great deals and prices we will be able to
provide. Comment by Michele: But as a startup and not a
known quantity, hospitals in particular will bargain hard.
Healthy Hands is a relatively unique company with only one
real competitor that can provide a service even remotely close
to what we have to offer. This company is called SwipeSense.
They provide a very similar product and service to ours.
However we feel that our business model will significantly
outperform theirs. This is due to the fact that we are
incorporating a more accurate way for tracking employees as
well as the fact that our quick and easy reload cartridges will
allow us to maintain a stable and constant revenue. We are also
going to provide unique soaps and sanitizers, which means we
will not be at the mercy of our suppliers.
SwipeSense will be at the mercy of the people who make their
hand sanitizers and soaps. This will essentially take a
7. significant chunk out of their revenue stream and will mean
they won’t be able to provide their dispensers OR their refills
for a price as low as ours. Therefore, in the long run, they will
not be able to compete. Any substitutions or new entries will
also not likely be able to compete; this is due to the fact that we
will ensure that our product is top quality and that it is as
affordable as possible. This, coupled with how aggressively we
intend to breech enter the market, no new companies will be
able to establish a customer base as large or as loyal as ours due
to our patents and our long term goals and strategies.
S.W.O.T. Analysis
We have a great amount of confidence in Healthy Hands,
due to our great number of foreseeable strengths and the limited
number of future weaknesses. Healthy Hands’ strengths start
with our control over our suppliers, and buyers. While our
service is not required, any self-respecting business such as a
hospital or restaurant will want our products and services.
Comment by Michele: You don’t have control over either.
Comment by Michele: Not necessarily. For one, their
employee base is going to rebel, citing privacy concerns. That
complaint might not hold sway, but trust me, it’s going to
happen.
Our suppliers do not need any state-of the art equipment in fact
the minute we have the funds we intend to build our own
facilities to construct our products on our own. To even further
limit the supplier power to next to nothing. Since our suppliers
can’t require anything extraordinary to create our product they
will have many competitors of their own and every client
counts. Our products are also affordable and will only be
compatible with our reload cartridges; this means if our
customers want to use their our soap dispensers they will have
to buy our refills. This provides several benefits, : first of all,
our customers will have to continue to purchase our cartridges
from us. Second, since we developed the soaps and the
cartridges, we don't have to give money to any other companies
8. other than the ones that provide our raw materials. Lastly, we
will be able to provide the dispensers and wrist bands at a lower
cost to encourage companies to purchase in bulk, allowing us to
establish a large customer base rapidly and effectively.
Another strength is that the science behind our concept already
exists; it is very well known how important hand washing and
proper hygiene is, especially in businesses models such as
hospitals and restaurants. It is only logical to assume they are
looking for a way to make sure their employees follow the
proper procedures. Moreover, our software, which will be
provided for a very affordable monthly fee, this will essentially
be enough to cover the technical support and help provide for
the other costs of running this service and even providing these
products to ensure the company is making a profit through its
consistent and steady revenue stream. Comment by Michele:
This sentence is extremely long and doesn’t flow.
These products and services are also capable of improvement
and upgrading to ensure that as technology continues to advance
so do we. Having a loyalty upgrade service to allow a discount
to existing customers for the purchase of new products and
services this will ensure customers remain loyal and that they
are happy giving us their business.
The culture of the United States has become very interested in
proper hygiene and this sociocultural climate will help facilitate
our product. Another environmental factor that will benefit
Healthy Hands is the fact that everything is wireless, and on the
internet, which is another trend Healthy Hands is taking
advantage of. Also from a legal stand point, restaurants and
hospitals are obligated to keep up with a proper code of
sanitation; with the release of Healthy Hands the bar to a new
level of proper hygiene which will result in pressure to invest in
our technology. From an economic stand point every customer
counts; if restaurants and hospitals are going to want to keep
9. their customer base and beat their competition they are going to
need to maintain proper conditions and investing in Healthy
Hands will enable them to reduce infection rates and help
maintain good reviews. Comment by Michele: This doesn’t
make any sense.
Our weaknesses while there aren’t many do exist and have
not been overlooked. First of all SwipeSense has already begun
their product development and have even begun product testing.
How can we overcome this? Simple, we take advantage of the
fact that they have already proven the success of this concept
and business model and then one one-up them. Sometimes being
the first one in isn’t the best option. We have identified many of
the hardships this type of a company will have to face and have
developed ways to overcome them, and now thanks to
SwipeSense the product and service concepts are now proven to
be efficient. Comment by Michele: Since this is out of your
control, it is a threat, not a weakness.
Another weakness is the possibility that people don’t actually
wash their hands but instead just go to the dispenser and
“pretend” to wash them. This too has been overcome by our ID
bands, which will have sensors to detect how efficiently
employees wash their hands by using an adapted accelerometer
to monitor the employee’s actual hand movements. Comment by
Michele: Again, out of your control, so it is a threat.
Some opportunities that Healthy Hands will face are the
fact that there really isn’t currently any business that has fully
launched its product line into the market yet. This means that
despite SwipeSense’s head start with product trials, Healthy
Hands will still be one of the first into the industry and will
have an optimum opportunity to compete and possibly beat our
main competitor.
Our main threat will be SwipeSense’s early jump on the
market testing of their product; if we are not careful, they could
just as easily beat us and prevent us from establishing a
customer base.
10. Our main competitor is SwipeSense the only company
which that currently plans to release a product anywhere near
what we intend to offer. We intend to out out-compete them
through our business model. We are aiming to establish a
captive market and to take advantage of repeat sales to develop
a reliable revenue stream. We also intend to limit supplier
power by utilizing our own production facilities and by
developing our own soaps and sanitizers. Another way we
intend to beat SwipeSense is with our new ID bands, which will
allow us to obtain more detailed and accurate data for use with
our product. The only threat SwipeSense can provide for
Healthy Hands is the fact that they are already well into their
product development, which means they will likely release their
product first and will establish some customers before we will
be able to. This will provide them with a unique but limited
opportunity to outperform us. We intend to counter this threat
by releasing into the market quietly and then aggressively
developing a customer base. As mentioned earlier, once we
establish our customers, the revenue will be steady and
consistent, will allow us to bring our product to the market for a
more affordable price, and will allow us to grow rapidly, which
for this particular business model is key. Comment by Michele:
These do not naturally flow from a steady revenue stream.
Clean up all blank space.
11. Market Analysis
Our market strategy is to sell our products for a cheaper price
than our competitors. Our only major competitor currently in
the market is SwipeSense. This is an advantage to us because
we are the only two companies who sell somewhat similar
products in the market. We will have high supply power because
customers will have fewer choices to pick from.
Market Size, trend and growth
Market research done by Global industry analysts showed that
the US market for Hand Sanitizers is projected to reach
US$226.3 million by the year 2018, primarily driven by
continued rise in health awareness, increasing disposable
incomes, availability of easy-to-use and convenient product
options, and increasing demand for non-alcoholic products.
Comment by Michele: Cite.
A newer trend emerging in the antibacterial sanitizers is the
availability of surface-cleaning products in travel packs. With
today’s fast paced lifestyle living, customers need for easy to
use and convenient product s on the go increases. Global threats
in the past such as SARS, avian flu, and the more recent H1N1
influenza or swine flu, led to a surge in demand for hand
sanitizers. Growth was also propelled by the findings that
gastrointestinal illnesses are reduced by about 60 percent in
households that used hand sanitizers, compared to non-users,
the report says.Comment by Michele: But you aren’t selling to
consumers; you are selling to hospitals, where employees are
limited in their ability to be “on the go.” Comment by Michele:
Cite. But we don’t care about households.
12. The best time to sell Healthy hands will be during the fall and
winter season .We have scheduled the launch of Healthy hands
in fall of 2014 because this is the season where a large
population suffer from cold and flu. Comment by Michele: Why?
Do hospitals buy more then? Comment by Michele: Do they
go to the hospital for these viruses?
Potential Market
Our potential markets are Hospitalshospitals, schools,
Restaurantsrestaurants, Day day cares care centers, homes and
office buildings. Although a person can catch germs almost
anywhere, but we believe these are the most congested areas
where germs can be spread easily. Comment by Michele: Too
much for a startup. Focus first on hospitals.
Product Distribution and Sales
A survey was conducted by healthy hands personnel for
customers who buy and use hand sanitizers. The results were
7/10 were likely to buy our product compared to other.
Regardless of whether the market is a niche or traditional
market, the hand sanitizer sales will still be handled in the same
manner. Customer satisfaction is our number one priority.
Comment by Michele: There is no business yet, so there
cannot be any personnel. Comment by Michele: Might be good
if consumers were your primary target market. But they aren’t.
Also, 10 responses is not nearly enough. You need to talk to
hospital personnel, restaurant owners, and the like.
Types of sales include:
· By mail order
· Via Internet
· Door-to-door sales and delivery
· Coupons and discounts
Estimated Market Share and Sales
A Nielson Co. report showed the retail market of hand sanitizer
13. during a 52 week period of the 2009 Swine Flu pandemic
generated as much as $180 million, a 70 percent increase from
the previous year. Comment by Michele: You aren’t selling at
retail.
Some key differences of our product include:
· It is a natural product, alcohol free.
· It is available in different sizes, different quantity and
different scent.
· Quality is assured as all products are raised to an audited
quality system.
· Doorstep delivery is available where possible.
15. Product/ Service Development Plan
Healthy Hands will release a series of products, all of
which revolve around the concept of providing subscribers with
data on their employee’s hygiene habits. The data will be
display the number of times each employee has washed their
his/her hands as well as a digital rating on how effectively they
washed their hands. This software will be available wirelessly
through the internet and will be available to employers and
employees. Employers will be able to access all of their
employee’s employees’ information and data and will be
automatically alerted if some of them don’t wash their hands as
frequently as the employer likes. The employer will optionally
be able to set the preferences for how often on average they
would like to see their employees wash their hands. Employees
will be entitled to view their own records and the records of any
co-workers who are supervised by said employee. The software
will also be available as an app eventually.
The software, while important, will not work without the
dispensers. These dispensers will have built built-in sensors and
transmitters to sense which employee is using the dispenser.
These units will also monitor the amount of soap left within the
dispenser and will send out an alert when it needs to be refilled.
The dispensers will also only be refillable through our easy
reload cartridges, which will contain our soaps or sanitizers.
16. The dispensers will also contain light panels to help maintain
their charge as well as batteries, which will also be monitored
on their charge,. When the batteries are low, the unit will send
out an alert so they can be changed. The dispensers will also
have the optional feature of radius sensors. These sensors will
monitor when a band wearer is within a set radius or leaves the
set radius of each dispenser. This will send an alert to the ID
band, which will alert it’s wearer to sanitize their hands after
leaving a room, which often involves the touching of a
doorknob. Dispensers will also have a portable option and will
allow employees to have the option of carrying one with them.
While the dispensers are keys to the services, they will not
work without our unique ID bands, which will emit a signal
when in close contact with the dispensers. These bands will also
contain an accelerometer, which will monitor the movements in
the band when the user is washing their hands. This information
will be compared to what the signal should look like when
properly washing one’s hands. This information will be
available to employers,’ with which they will be able to make
decisions on whether or not the employees are taking care to
effectively wash their hands. These bands will also be water
proof, and we will also develop a small clip, which will be
reusable and will attach to the hospital wrist bands of patients
and will be paired with their room. This will allow staff to
monitor patient sanitation practices and will even be an
effective way to track patient interactions. This information will
be useful in cases of locating patient zero and preventing
infection spreading during infectious outbreaks. These ID bands
will also have internal batteries and will have an alert
mechanism to remind wearers to wash or sanitize their hands
after entering or leaving rooms or, to change the batteries or
even to send the band in for maintenance.
Faucet sensors will also be an optional feature and will
allow for more accurate readings on how effectively users wash
their hands as well as ensuring proper tracking of when an
employee washes their hands. These will be waterproof and will
17. be easily attachable to faucets in sinks. They will be waterproof
and have light panels to aid in their powering.
As mentioned earlier, dispensers will require the easy
reload cartridges to refill them with their respective soap or
sanitizer. These will be produced within our own production
facilities and will come with a large variety of different types of
soaps and sanitizers for all manners of uses. These will be
optimizing optimized for the needs of every type of user we
may encounter. , From from households use to prep rooms for
surgeons before surgery.
The production of our dispensers will most likely be done
by a separate company possibly outsourced to maintain low
costs.
We will likely need to obtain patents for our ID bands as
well as our unique new dispenser designs. As, as well as for our
software as well as and our easy reload cartridges
We intend to prototype and test by offering free trials to
several hospitals; we will provide them with our units as well as
a supply of our cartridges. This testing will give us input on
what needs to be altered on each unit as well as give us more
accurate data to help make better predictions on what our
revenue would be due to sales of refills and units themselves.
This data will be very useful when establishing the final price
of our product. We will also receive information on what
technology will be needed to establish a reliable and accurate
software and service.
18. Financial Plan
The assumption for the first year is that our group is going to
develop the prototype for our product and try to test the product
in Drexel Hahnemann University Hospital. The reason for this
move is we want to introduce this product in during the flu
seasons. Because of the limited times we do not think that is
enough time for us to make and introduce the product for this
year. Moreover, we could use this to collect data on the machine
and fix any bugs and understand how effectively does the
machine works. In addition, how what the hospital and the user
thinks of our products and where we can improve to make it
better. Comment by Michele: This is not a complete
sentence.
We are going to start our business as an LLC (Limited Liability
Company) for tax and liability reason, with the advantage of
LLC it protect our own person assets and less recordkeeping and
lower startup cost. There are also fewer restrictions on profit
sharing within an LLC, as members distribute profits as they see
fit. Members might contribute different proportions of capital
and sweat equity. Consequently, it is up to the members
themselves to decide who has earned what percentage of the
19. profits or losses. We will file form 2553, which will make our
LLC Tax as an S-Corp. In addition, Pennsylvania state Law
going to tax the company 9.99% corporate income tax.
Comment by Michele: Not as an LLC it won’t.
The Startup startup Cost cost For for our Company
company would be around $1,000,000 for labor and materials
and legal matters such as like patents, taxes and any other legal
issues. We plan to finance our research by applyly for
government grants and get loans from the (SBA )Small Business
Administration, and we go to will present this idea to Drexel
University to get help and aid from the university with the
production and development of our product. The resources and
ability of Drexel University we should able to cut down our
costs like such as providing engineers and servers to collect
data. Comment by Michele: Taxes aren’t legal issues.
Comment by Michele: If you do this, Drexel will own the
technology. You’ll have to license it from the university.
We are going to develop the WIFI WiFi Device device and ID
scanner on these products, ; we going to will buy the dispenser
and bracelet from the retailer or wholesaler and just installing
our WIFI WiFi devices into them until our company can sustain
itself, then we will think should we still going to buy or make
the dispenser ourselves. Depend on with method would reduce
of the overall cost of the product. Comment by Michele:
Which one? Comment by Michele: ? Comment by Michele:
I cannot figure out how to fix this sentence.
The Dispenser dispenser we found online from a wholesaler; the
cost is around $15 Per per Dispenserdispenser. The Bracelet
bracelet was around $5 per Bracelet bracelet and $2 per clip.
We are planning to make our own soap and hand sanitizer. also
the The material for the WIFI WiFi device for dispenser will
cost $10 per device, and the ID band scanner will cost $8 and
the ID Clip will be $5 The assumption of doubling our
production every year our company will able to sustains itself
by the fourth years. The first year of Development for the trail
20. with Drexel Hahnemann University Hospital, our Company
expects to make 200 hand soaps dispenser and 300 hand
sanitizer pricing at $30 per dispenser. we plan to make 600 the
ID band bracelet for doctor and Nurses pricing at $150 each and
2000 reusable ID clip for patients and other selling at $8 each.
In addition, we plan to sell our Hand Soaps at $25 per Gallon.
Our profit on the dispenser and ID band are very little. What we
goal is to make money on the hand soap and hand sanitizer from
repeat customer. After the prototype test in Drexel Hahnemann
University Hospital is complete, we plan to double our
production and sale this product to the hospital nearby and
slowly expand out to other market.
Change all of the assumptions to simple bullet points. This was
far too difficult to read.New Venture Development Timeline
Months
1
2
3
4
5
6
7
8
9
10
11
12
Stage 1: Market Research and Technical FeasibilityComment by
Michele: The technical feasibility would probably take longer,
but all the rest of these items should be complete with this
feasibility analysis.