ELITE WEATHER ENTERPRISES

Let Us Introduce Ourselves

• We are comprised of Penn State Graduates whom majored in Meteorology • Combined total of 15 years of

forecasting experience• Company experience at Leslie’s Pool

Supplies • Link between Meteorology and

Business

Jacqueline Layer• Chief Editor at Elite

Weather Enterprises• Interned at WTAJ TV in

Altoona as a Weather Forecaster

• Active member of Penn State Campus Weather Service

• Member of the American Meteorological Society (AMS) and National Weather Association (NWA)

• Actively involved in Penn State THON Dance Marathon

Thomas Lutz• Program Director at Elite

Weather Enterprises• Active member of Penn

State Campus Weather Service

• Member of the American Meteorological Society (AMS) and National Weather Association (NWA)

• Assistant Coach of Penn State Hazleton Soccer Team

Bre Hawras• Operations Manager at

Elite Weather Enterprises

• Active member of Penn State Campus Weather Service

• Member of the American Meteorological Society (AMS) and National Weather Association (NWA)

Sean Gauslin• Business Consultant at

Elite Weather Enterprises

• Former Employee of Leslie’s Pool Supplies

• Active member of Penn State Campus Weather Service

• Member of the American Meteorological Society (AMS)

Kyle Gibson • Forecast Analyst at Elite

Weather Enterprises• Active member of Penn

State Campus Weather Service

• Member of the American Meteorological Society (AMS) and National Weather Association (NWA)

• Active Member of the Penn State Golf Club

What we know about Leslie’s and the

industry$5 billion dollar industry with Leslie’s as main provider

Leslie’s total earnings is now exceeding $500 million a year

Leslies’ competitors are a small part of the industry generally “Mom and Pop” stores with limited stock

Leslie’s also has a successful online store and mailing catalog that provides an extra 30,000 items to their customers

Leslie’s has 622 stores in 35 states from New Hampshire and Michigan, all the way to Northern California.

Arizona, California, Florida, and Texas have the most stores.

• Store placement based on climate and population

• It is expected that millions of pools will be popping up in these locations over the next several years.

Location….Location

How Can our index save Leslie’s Money?Shipping and DistributionLabor Costs

How can our Index Make Leslie’s Money?Sales forecast

Two important questions EWE will

answer

Distribution centers in New Jersey, California, Kentucky, Texas, and Florida.

Without distribution companies would not be able to survive

Shipping and distribution is highly dependent on weather variables, weather variables that our Index accounts for

Our index will be able to provide key information for shipping and distribution

Saving Money through Distribution

and Shipping

Expenses

$61,200,000 on operating expenses

10% on shipping and distribution

Our index could save Leslie’s potentially 1% of their shipping costs or even more

Possible savings

$612,000

Per year, number can fluctuate

Shipping costs

Leslie’s spent $61,200,000 on labor in 2009 and most likely spends around that if not more as their store size increases

With the use of our index, store managers around the country can better determine the amount of labor needed for the next 5 days.

Labor Costs

With our index in place and store managers making the correct labor adjustments Leslie’s could save tens of thousands of dollars per year.

1 store saving an additional $30 in one day, multiply this by multiple stores and dozens of days you get massive savings

A Little Here & There Adds Up

Philosophy of our company vs. another

Average salaries of meteorologists employed by the federal government is over $93,000

Our index costs less (explained in contract)

1 vs. 5

Knowing where to ship products based on an increase in customers can be extremely difficult

Our index will do this for you and provide Leslie’s with the knowledge of where sales should increase based on forecasts and weather variables.

Sales forecast

Making Money

Once Leslie’s knows where sales are likely to spike upward Leslie’s can ship accordingly

More Customers + More Product = Increased Sales and Revenue

It’s a simple idea but hard to do without help

Sales Forecast

Expenses Potential Savings per Year

Shipping and Distribution Savings $612,000

Labor $30,000-$100,000

Index vs. Full Time Meteorologist $20,000-$50,000

Total Potential Savings $662,000-$762,000

Savings Summary

What is a Weather Index?• A way to compress large amounts of data into an easy-to-read format that allows for rapid decision-making• Numerical or graphical

Importance of Weather Indexes

• Consolidate weather variables into a easy-to-read scale for the public or your company

• Allows people to know what they should expect

• Will help your company make risky decisions with more ease

• You will be able to save thousands of dollars

Sample Weather Indexes• Weather indexes are used

frequently and are beneficial in saving people’s lives• Examples include the Weather Channel’s Tor Con index, Wind Chill index, UV index

Improvements in Forecasting• Throughout the years meteorological forecasting has improved

since the 1970s. • The chart below shows the National Hurricane Center’s average

forecast errors for Atlantic Basin Tropical Storms and Hurricanes.• In 1970, average error for 24 hours out was 120 miles. • In 2010, average error for 24 hours out has improved to just

over 50 miles.

30% of your stores are located in Florida and Texas

These areas are hurricane prone but better forecast will allow you to save money if one strikes

labor savings- giving employees off when they are not needed

Move stock around where its needed obviously not Florida or Texas

Get Stores prepared for onset of hurricane

Improved Hurricane forecasting

• 70% of the time one day forecast high temperatures are within 3 degrees of the forecast

• 53% of the time the high temperature is within 3 degrees for a forecast 3 days out

• Big improvements- 5 day forecasts today are now as reliable as 2 day forecasts were 20 years ago

• Displays average error from the high and low temperature that was forecast

• Huge strides have been made in the last 30 years • 1970 the average error was about 1.85 °C• 2000 the average error was about 1.41 °C• 1980 you can see a huge dip due to the advancement of

computer models and meteorologists becoming better educated

Forecast Model Improvements • NAM (North American Mesoscale Model)-

solves forecast equations at grid point to come up with forecast

• Resolution has improved from 24 KM to 4 KM

• More data going into the model produces a more trustworthy forecast

• The more grid points allows us to see a better overview of the weather

Ensemble Models Improvements

• Allow for any changes or uncertainty in the forecast

• This allows for a range of possibilities • The most likely outcome lies right

down the middle• Gives meteorologists a higher

confidence if all the solutions are down the center

• The computer models have their limit, so as meteorologists we will need interpret the data and come up with a trustworthy forecast

• Our studies at Penn State have allowed us to become the most dependable and reliable meteorologists

• With computer models continuing to improve and able to perform more tasks the indexes we develop will become more accurate

Overall Improvement and Skill to Produce

Forecast

• The “Jump Right InDEX” will provide the company with two color-coded maps

• The first map received by the company will be a five day rating of the swim conditions.

• The second map will be an average for the next 30 days.

• The company will have the option to get an index for a specific region of their choice.

Quick and Efficient Decisions!• Supplies to order• Work-hours• Inventory• Advertising for a region• Long term events

The Variables• Local Temperature• Population Density Per Store • Precipitation• Temperature departure from

normal• Relative Humidity• Amount of Sunshine • Average Wind Speed

Maximum Temperature

Precipitation

Chance of Precipitation

Addition to Index

0 18

<30 15

30 - <60 10

60 - 90 6

>90 1

Temperature departure from normal

Temperature Departure from Normal (absolute value degree F)

Addition to Index

< 5 155 146 137 128 119 1010 911 812 713 614 515 3> 15 1

Relative Humidity

Amount of Sunshine

Average Wind SpeedAverage Wind Speed (In kts) Addition To Index0 - 5 155 - <10 1310 - <15 915 - <20 520 - <25 3> 25 1

The Five Day Index

The 30 Day Index

Contract • There are going to be several

offers you can choose from to fit your needs.

• Before any packages are purchased, a one, two, or four year agreement must be purchased.

• 1 year agreement--$10,000• 2 year agreement--$20,000• 4 year agreement--$30,000

Package One 5 Day Nationwide Index

Forecast

Package One Cost Breakdown

• Labor: $30,000• Technology & Web Development -

$5,000• Research & Development - $5,000• Total Cost - $40,000• Leslies would receive the forecast

index electronically on a daily basis if this package is chosen.

Package Two 5 Day RegionalIndex Forecast

Package Two Cost Breakdown

• Labor: $25,000• Technology & Web Development -

$5,000• Research & Development - $5,000• Total Cost - $35,000• Leslies would receive the region based

forecast index electronically on a daily basis if this package is chosen.

Package Three 30 Day Nationwide Index

Forecast

Package Three Cost Breakdown

• Labor: $20,000• Technology & Web Development -

$5,000• Research & Development - $5,000• Total Cost - $30,000• Leslies would receive the forecast

index electronically on a bi-weekly basis if this package is chosen.

Package Four 30 Day Regional Index Forecast

Package Four Cost Breakdown

• Labor: $15,000• Technology & Web Development -

$5,000• Research & Development - $5,000• Total Cost - $25,000• Leslies would receive the region based

forecast index electronically on a bi-weekly basis if this package is chosen.

Package Five 5 & 30 Day

Nationwide Index Forecast

Package Five Cost Breakdown

• Labor: $40,000• Technology & Web Development -

$5,000• Research & Development - $5,000• Total Cost - $50,000• Leslies would receive the 5 day

indexes on a daily basis and the 30 day indexes on a bi-weekly basis if this package is chosen.

Package Six 5 & 30 Day

Regional Index Forecast

Package Six Cost Breakdown

• Labor: $35,000• Technology & Web Development -

$5,000• Research & Development - $5,000• Total Cost - $40,000• Leslies would receive the 5 day

regional index on a daily basis and the 30 day regional index on a bi-weekly basis if this package is chosen.

Package Seven 5 & 30 Day National &

Regional Index Forecasts

Package Seven Cost Breakdown

• Labor: $60,000• Technology & Web Development -

$8,000• Research & Development - $7,000• Total Cost - $75,000• Leslies would receive the 5 day

indexes on a daily basis and the 30 day indexes on a bi-weekly basis if this package is chosen.

Thank You!Any

Questions?

SOURCES Australian Government. Mean Modulus Error. Digital image. Australian Government Bureau of Meteorology. 1 Jan. 2011. Web. 13 Jan. 2012. http://www.google.com/imgres?q=mean+modulus+temperature& "Atmospheric Scientists." U.S. Bureau of Labor Statistics. Web. 31 Jan. 2012. <http://www.bls.gov/oco/ocos051.htm>. "ForecastAdvisor Weather Forecast Accuracy Blog: Accuracy of Temperature Forecasts." Weather Forecast and Weather Forecast Accuracy for Your City. Web. 21 Jan. 2012. <http://www.forecastadvisor.com/blog/2006/09/24/accuracy-of-temperature-forecasts/>. Leslie’s Poolmart Inc. Annual Financial Report "National Hurricane Center Forecast Verification." National Hurricane Center. Web. 31 Jan. 2012. <http://www.nhc.noaa.gov/verification/verify5.shtml>. "Spas & Hot Tubs." Leslie's Swimming Pool Supplies, the World Leader in Residential and Commercial Pool Supplies. Web. 22 Jan. 2012. <http://www.lesliespool.com/Home/Spas-and-Hot-Tubs.html>. "Summer Weather Safety Week." National Weather Service - Central Region Headquarters Home Page. Web. 23 Jan. 2012. <http://www.crh.noaa.gov/lsx/?n=summerweathersafetyweek>.