EXECUTIVE SUMMARY

The Company

The business venture is focus on direct selling. The activity will have a start-up with OFWs’ and non-Filipino community households in Rome, Italy. Initial capital would be 4,524.785 euro, in which partners will have a share of E2,262.39 respectively. The product they will provide the market is LeveLuk SD501 Kangen Water machine, a water ionizing device originated in Japan.

The Product or Service

LeveLuk SD 501 Kangen Water machine is a type of water ionizing device which creates the best quality of water. Through a three layered filter it ionize and restructure the water making it more alkaline and hexagonal or micro clustered. This type of water helps in the detoxification of free radicals and helps neutralize acidity in the body. Align with this product is the dynamic compensation earned upon its distribution.

The Market Potential

Questionnaires were provided to prospect consumers and interviews were done in order to gather information on the demand on the product. Target consumers are people 18 years and above, male or female, average income earners, and belongs to the household industry. Within 30 people, we have gathered the data that 18 of them will avail the machine. The reason is they aim to provide their families the best possible healthcare within reach using the best Kangen-grade water created by our product. In addition, the income to be earned in the direct selling of the machine also stimulates customers of the product. Ultimately, the business is seen to be feasible.

The Competition

Bottled waters, local purifying and filtrating devices, Osmosis purifier sold by local vendors already are the possible competitors. But the product we will advocate has all the qualities of the best ionizing, filtrating water device people could have. Having a mother company that exist for 30 years and more, producing the best of the best water ionizing devices in the water industry, having its distributors of integrity and un-denied success in the field of marketing, the abundance of the product’s health merits, and financial freedom, no doubt that our product will not lead the competition.

The Strategy

Free waters will be distributed on prospected customers. Demonstrations on how the machine creates the best Kangen-grade water, discussions on how it would enrich the health status of the body and how it helps balance the equilibrium of the environment will be done as our market strategy. After seeing the benefits of the Kangen water, they will surely get a unit of the machine.

The Financials

Initial investment or the capital will come from share of contributions from partners. Projected balance sheet, forecast on income statement up to the point of break-even will be shown in the annex.

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ORGANIZATION AND STRUCTURE

Basic Corporate Data

Name of Business: -- KANGEN RICHNESS

Status: Indipendent distributor of Enagic’s Kangen Water machine.

Capital: --4,524.785 euro start-up cost

Planned Office: --No permanent place. Machine will be located on either of the partners’ house.

Teresa Populi-De Chavez, via Giulia di Gallese 7, 00151, RomeHaydee Lunar-Panganiban, via Constantino Corvisieri 22, 00162 Rome, Italy.

Company’s ultimate goal

To help enrich the health of our customers by providing a machine that will supply the best quality, Kangen-grade water and to help them earn more income through the distribution and selling of the Kangen Water machine.

Mission

To create a market in whole Rome, Italy and in the future in nearby cities by providing customers with Enagic LeveLuk SD501 Kangen Water machine. Target market are households and community churches. We will do demonstrations on churches (outdoor) and in house.

Company values

In today’s economy, direct sales marketing structure of business can be considered as the most effective way of doing business. Having a trusted, highly integrated mother company and manufacturer, business partners who are hard-working, skilled, independent and client-focus, there is no doubt to success of this business venture. In addition to this, a quality product, effective and efficient LeveLuk SD501 Kangen Water machine, a trusted medical device, the abundance of its health merits and financial rewards that the company gives are the basic values that will guide us in managing our business and our clients.

Brief history and current status

The business is called Kangen Richness. Teresa Populi-De Chavez and Haydee Lunar-Panganiban decided to build this business because they have seen such problems of the society that really affects it in a whole. We pertain basically on the poor healthcare industry and lack of income sources. This start-up business focus on the distributorship of Enagic Kangen Water ionizing device specifically the LeveLuk SD501 machine that produces ionized, hexagonal water. The water produce by this machine is the best type of water to neutralize the body and the environment as well. And the dynamic compensation plan that the mother company is offering gave us the idea to help our customers earn additional income.

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Enagic and the phrase Kangen Water are registered trademarks of Enagic, Inc. Founded by Hironari Oshiro, Enagic, Inc. is a 30 year-old company using water ionizing technology with a proven track record. It makes one of the few water ionizing devices that is officially approved, based on health merits, by the Japanese Ministry of Health, Labour and Welfare. Over one hundred hospitals in Japan utilize Enagic’s device, enabling them to treat their patients with Kangen Water. Enagic, Inc. is the only company in the water industry endorse by the Japanese Association for the Prevention of Geriatric Diseases, an association of over 6,500 doctors and surgeons. It dominates the industry with over 400,000 satisfied families worldwide using their water devices. Enagic owns and operates the manufacturing plant where each component part is created. Each machine is assembled by hand, and their quality control is the best in the industry. It produce several models for home and commercial use, and this business plan focuses on their top-of-the-line home model, the LeveLuk SD501. LeveLuk SD501 creates Kangen Water , the water that has returned to its origin. Water that creates balance for our body and for our environment. It entered in the US market in 2003. Their LeveLuk SD501 is approved by the Japanese equivalent to the US FDA and has won an award from a prestigious group of doctors and scientists as being the ONLY water treatment system to prevent adult diseases.1

To help people become physically, financially, and mentally healthy in the midst of this economy trapped by crisis, we come up on starting this type of direct selling business. Since the product is already introduced and presently having a market in Milan and Bologna, we come up with the idea of starting the market here in Rome, which we all know exactly as the center of Italy where lots of clients we focus to market the product is found.

Organization and management

Teresa Populi-De Chavez and Haydee Lunar-Panganiban are the business partners of Kangen Richness. They are young entrepreneurs who are willing to exert effort and initiative and take the risks throughout the venture of the business. Haydee is a licensed midwife, graduated in a School of Midwifery, Lyceum of the Philippines, Batangas in 1994. Since she is connected in the line of medicine, she will be responsible on the product presentation, demonstration as well as discussion of the machines’ health merits. Teresa on the other hand has finished a bachelor’s degree in Commerce major in Business Management, and graduated as outstanding management student in Lyceum of the Philippines, Batangas in April 2002. She will do the discussion of the distributors’ compensation plan and will hold the responsibility of bookkeeping, where she’ll do the records and filing of the orders, payments, clients’ accounts, and accounting in a whole.Mr. Mark Cristal will be our advisor. He is one of the successful independent distributors(rank 6A) of Enagic and is the CEO of Kangen International Mission. 2

Core competencies

Customer relationship: Our focus will be to satisfy the healthcare needs of our clients by offering them solutions and by keeping a good long-term customer-distributor relationship.

Market research and understanding: Various contacts with friends, household and churches is the key on getting connected with the prospected customers. This served as our starting point in gaining market understanding through interviews and questionnaires we give them.

Negotiating: Our approach is face-to-face, direct-selling type of marketing and negotiation. We understand that our customers prefer that we personally meet with them so we will do it by setting appointments. And through the power of word of mouth, we will do demonstrations to show them our product and its benefits. Face-to-face communication is proven to be a very useful skill in marketing to lessen miscommunication.

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Operations Management: Our business activity concentrates on customer-relationship management and direct selling, so particularly we will do the recruitment of new clients and maintaining good relationships with them. Since we do not have inventories, we reduce our working capital to a minimum.

Product development: It is characterized by having updated and continuous work with our partner, ability to meet the needs of our clients by offering them with customized best quality product, reliable and efficient service and performance of our product.

PRODUCTS AND SERVICES

Description

Enagic LeveLuk SD501 Kangen Water machine is a type of water ionizing device originally made and manufactured from Japan. It produce a much higher percentage of hexagonal Kangen-grade water. It weighs 6.3kg, and with a dimension of 285x264 inches making it very much portable.The machine is so unique that it has a lot of good features. It has a superior 5 year product warranty, with a 15 to 20 years life span, comprehensive maintenance program, superior automatic self-cleaning system and approved medical device in Japan. It has seven platinum coated titanium plates for electrolysis and also produces micro clustered Kangen-grade water. This is a heavy duty device, superior to its competitors. The water chamber is engineered so that it may be dismantled for service if needed. The SD501 will produce about three times the volume of water that others will in the same period of time and the filters will lasts for about 3,000 gallons vs. 1,000 gallons. It uses 230 watts of electricity, a high power that splits the water molecule and produces the desirable hexagonal molecular structure.

Enagic LeveLuk SD501 produces Hexagonal water which is comprised of small molecular units or ring-shaped clusters-moves easily within the cellular matrix of the body, helping with nutrient absorption and waste removal. It aids metabolic processes, supports the immune system, contributes to lasting vitality and acts as a carrier of dissolved oxygen. It can provide alkaline minerals to the body and it helps in the more efficient removal of acidic wastes. Drinking hexagonal water takes us in the direction of health. It supports long life and freedom from disease.It has a compact design and easy to use. A clear, easily-viewable LCD and voice prompts guide you in producing the 5 types of water (Kangen Water, acidic water, Strong Acidic Water and clean water). With only the touch of a button, the machine is extremely easy to operate. It is fully-equipped with an electrolysis enhancer tank. Continuously producing Strong Acidic Water and strong Kangen Water. There is also a three-layered, high power filter that delivers the delicious water. Able to process approximately 6,000 liters of water, these powerful filters are good for approximately 6 months of general use(assuming an average use of 60 liters per day). The large LCD will notify you and an alarm will sound when the filter needs to be changed. The three-layered, high power water filter removes contaminates such as lead, chlorine, effluvium, rust and other debris, yet retains important minerals.

Doing the direct-market selling type of business, we are going to endorse and distribute the products to community churches and the households. Procurement of the machine will enable the customers to serve best their community by giving them a quality healthy Kangen-grade water. While the household will benefit not only with the abundance of healthy quality Kangen Water always available at home but also with the dynamic compensation plan they could earn if they will also distribute and sell units of Enagic LeveLuk SD501 Kangen water machine.As a result is a more healthy society, physically, mentally and financially.

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Products/Service Features

The Ultimate Home Use Model

The LeveLuk SD501 is the finest machine in its class, with the highest quality built-in electrolysis chamber on the market. This Kangen Water® filtration machine generates a continuous stream of 5 types of water for countless household needs. You can easily operate the SD501, thanks to a large LCD panel and clear voice prompts. When you need enough delicious, healthy alkaline water to hydrate your whole family, the SD501 is the product you've been searching for.

(Reference: https://www.enagic.com/technology_products.php#p=sd501)

LeveLuk SD501 has a compact design and easy to use. It has 7 electrode plates to ensure sufficient power. A large LCD and voice prompt make for easy use. Fully equipped with an electrolysis enhancer tank. Continuously producing Strong Acidic Water and Strong Kangen Water. It also has a 3 layered, high power filter that delivers Sanitary water [disinfecting] (*pH 2.7 & below); Beauty water [healthy and hygienic] (*pH 4.6); Clean water [gentle for everyday use] (*pH 7-same as tap water); Healthy Kangen Water [innovative water] (pH*8.5-9.5) and Environmentally friendly water [green cleansing power] (pH 11 and higher).3

On the other hand, the dynamic compensation plan for new distributors are really exciting to achieve. They can start building wealth through the distribution of Enagic LeveLuk SD501 machine. Having 6 ranks (1A-6A), all ranks have 8 levels or points to pay. To advance in rank, the distributor must have personal sales and further her team must accumulate a specific number of sales. A distributor can rank directly from 1A (must have 2 direct sales) to any other rank when the accumulated sales volume meets the stated requirements. Having an example, you are a 1A with two direct sales. You become 2A when you sell a third unit. Or you can jump directly to 6A from a personal sale if the total amount of units sold in your team is at least 100.

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The total 1A commission is 145 euro for a unit sold in cash plus the special bonus of 30 euro with a total of 175 euro/unit sold. . Special bonus is get when a direct sale is done within 90 days. A fantastic compensation awaits more for 6A rank. And by helping other team to reach 6A, you become 6A2, 6A2-2 and soon. Upon reaching 6A rank and higher, there are lots of awards, incentives and commissions to be achieve. Kangen Richness partners our prospects clients and distributors to reaching these ranks by leading, proper guidance, trainings and mentoring.

THEORY OF CHANGE

Saving initial capital---purchase of LeveLukSD501 Kangen Water machine---advertise and market the product---units sold--- increase sales, less cost, more income, disease free customers---physically, financially, mentally healthy society and environment.

BUSINESS STRATEGY

Our strategic objectives are as follows

1. To lead the market in whole of Rome and nearby cities on the 5th year;2. We target to sell and distribute 100 units by the end of our 2nd year;3. Achieve the fantastic compensation of 6A rank by the end of 2nd year;4. Achieve 95% in customer satisfaction surveys by 2015;

Strategy

In-house & outdoor demonstrations---share FREE Kangen Water, discussion of compensation options & payment plans---evaluation on the used of Kangen water---procurement of LeveLuk SD501 Kangen water machine---mission accomplished, physically, financially and mentally healthy society.

Free water. Abundance of health benefits. Affordable payment options. On this, the strategy of our business will focus. We will give free Kangen-grade water for consumer to test its health benefits. The LeveLuk SD501 machine is costly that we knew from the beginning it will be the reason they would hesitate to purchase the product. But after usage of the water and proving its efficiency and effectiveness on the health of each and everyone in the family, there is no worry that they will come back to us and buy our product. When we speak of health, people pays to invest for the best. The affordable payment options given by Enagic would be another way of easily availment of the machine. Through this strategy that customers will try the opportunity of earning too, while helping others as well. And we will never stop giving free water until they see the difference the machine could bring them, stability healthy, physically, financially and mentally.

Direct selling is the business structure we will dig into. Defined as marketing and selling products directly to consumers away from a fixed retail location. Sales are typically made through party plan, one on one demonstrations or other personal contact arrangements. In here income is raise easily because the sales agent is paid not only for their own sales but also through a commission on the units sold by those representatives they introduced into the organization and got recruited.

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Customer Segment

Our target market will mainly be the households and community churches. For future expansion are doctors of medicine, skin care clinics, and gyms. These are the people concern for the health of their family members, patients, clients, and for their people in general.

Value Propositions

We will give free Kangen grade (ionized, alkaline, hexagonal) water from our Kangen water machine (LeveLuk SD501). Customers will be given free demonstrations about the product, water it produce, and the health benefits it could give. Having ENAGIC, Inc., a mother company of integrity of proven effective and efficient water ionizing, filtrating generators, surely customers will patronize the product. Doctors, skin care clinics and gyms would get more clients having been understood and known that they are using this machine to help serve and cure their patients and athletes. Being part of the service of the church, acquring our product would be a big help for its community, whom the church can give free clean water to its people. In addition to this, the customers, particularly the households who are the promising new distributors/agents to be, will benefit more on the dynamic compensation plan that the company is offering. The costly price of the machine can be resolved easily through the affordable payment options available.

Channels

The machine will be introduced in the market through the free water pubblicities like leaflets, word of mouth, media i.e, mobile phones, internet, and announcements. Advertisements will contain the abundant benefits of the water to the equilibrium of the body and environment. Upon consumption of the water, they will be capable of distinguishing the waters’ effectiveness and the efficiency of the LeveLuk SD501 Kangen water machine. Surely that people will come back and ask for the machine. Providing enough understanding and information about the machine, we allow them to avail the machine. Ultimately, customers will be monitored upon purchased of the machine until the time they still needed our guidance and services. We will be on the reach out of updating the customers for the innovations and developments of the product through trainings, seminars and internet resources.

Customer Relationship

Quality service to people and society and the love for nature are the values we give emphasis on this business. All our customers will be given the opportunity to help themselves, their families, their customers, patients and clients of the quality Kangen Water by the use of our product LeveLuk SD501 machine. A product that is newly introduce in Rome yet a known-guaranteed and proven medical device in Japan and US for years having a successful record to help achieve equilibrium of mankind, body, lifestyle and environment. Having free waterto try, a machine with a compact design, portable and easy to demonstrate instructions, a price that is worth much of its health merits and financial benefits, these are enough for people to trust us and avail the product. Customers will also find it easy to pay because of the affordable payment option available. Furthermore, when it comes to health, it pays to invest in the best.

Revenue Streams

Income will come from the commissions earned for every units of machine sold, personally and from the newly recruited distributors.

Key Resources

Customer relationship - we will do direct selling, face-to-face negotiations to customer.

Intellectual - Under the patent of the main company, Enagic, Inc., upon the procurement of the machine, we become indipendent registered distributors.

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Financial - will we get our capital from our own personal savings.

Raw Materials - LeveLuk SD 501 Kangen Water machine.

Key Activities

Distribution of free Kangen-grade water, demonstration, discussion of compensation and payment plan options.

Key Partners

The mother company, Enagic, Inc., community churches and households. For future expansion are the medical doctors, skin care clinics and gyms.

Cost Structure

The operation is considered value-driven because we are focused on the value of the machine , the best quality of water it produces and the health benefits it could bring to the customer. Another focus is the value of the compensation for a win-win solution, that is the point when an order of the machine is made. Start-up cost is minimal, it is modest and mainly to cover the cost of the distributors’ kit. In addition are the supplies needed for a 3 years projected marketing.

Start-up Cost Marketing Expenses

Start-up equipments Qty. Amount in euro Marketing Expenses AmountLeveLuk SD501 machine 1 3,308.20 Church Donation E360.00

Electrolysis enhancer 6 15.00 Cell phone bill 720.00pH tester 6 9.00 Transportation 900.00Pre Filter 6 720.00 Advertising, Printing 200.00High-grade Filter 2 160.00 Miscellaneous 20.00Chlorine tester 3 10.50Brochures SD501 English 5 5.00Brochures SD501 Italian 2 2.00VAT 19% 175.085 TOTAL MARKETING EXPENSES E2,220.00

Total Cost of Production(3 years)4,524.785+2,220.00=6,744.785euro-[2(yrs) x 661.6(cost value of SD501)=]1,323.3=5,421.485 euro

ORP tester 1 76.00Shipping 1x 44.00TOTAL STAR-UP COST E4,524.785

The marketing expenses covers all the expenditures connected in the operation proper of the business including the demonstrations to be done for the indicated 3 years of projected business activity. Monthly church donation is amounting to E10 each demonstration for 36 months. Cell phone bills are E5/week, E20/mo. Tickets for transportation costs E150.00 per partner, so E450 each making it E900 for 36 months. Advertising includes leaflets, CDs’, reading printed materials and printing supplies that is estimated to cost E200 for 3 years. Miscellaneous expenses of E20. From the total cost of production is subtracted the remaining 2 yrs cost value of the machine, to the fact that it has 5 years warranty, yet computed as is utilized for 3 years projection. Supporting financial documents are attached in the annex.

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Economies of Scale

0.5 1 1.5 2 2.5 3 3.50

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1

1.5

2

2.5

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3.5Output

Output

The economies of scale shows that in the monthly advertising average cost of 61.05 euro (in church demonstrations) the number of output is increasing, as the newly recruited client get another customer. Direct and group sales increase, thus earnings gets higher. As advertising cost spread all over the marketing activities, the number of sales (output) increases. The only thing important here is to keep getting direct sales, that is focusing on the target customers and continue advertising/marketing giving value on the testimonials and evaluation on the benefits of water to the customers.

Our Promise – what will you guarantee or promise to your customers and suppliers?

An effective LeveLukSD501 Kangen Water machine, efficient to resolve healthcare problems, a dynamic compensation plan, quality service and distributors which are always on the reach to help them help enrich their lives, these we promise to our customers.

Why will this promise be hard for competitors to copy?

Because we give free Kangen-grade water for free until customers see and feel the proof of its benefits, we don’t sell the water. We introduce the only water ionizing machine, Enagic LevelLuk SD501 which has a 30 years successful track record of medically proven benefits to customers and still on its way of giving abundant health merits.

Why will we be profitable?

The fact that water is vital to humans’ survival keeps us believing that this business will be making profits, greater profits. It is a win-win business because of its never ending health benefits and because of our never ending share on giving free Kangen-grade water. Customers will continuously consume the free water and will surely be back to buy the product testifying the help it gave them to solve their health problems. Not to mention the dynamic compensation plan and the awards and incentives that would be continuously earned attracting the prospect agents.

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Annex I

SALES FORECAST

Jan-Dec. 2013

Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.0

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Total SalesIndirect SalesDirect Sales

The graph shows the number of units sold (from direct sales- shown by blue line, and indirect sales shown by red-green line) is increasing because the demand for the product is also increasing and the more the demand is the greater becomes the income. For the whole first year Jan-Dec. 2013. While the violet line indicates the level of sales made each month.

MARKET/CUSTOMER ANALYSIS

Demographics- OFW, 18 years and above, average income earners, residents in Rome and nearby cities.

Psychographics- customers are those people who give much value to the health of the family members and willing to invest to the attain the best healthcare possible and within reach.

Resource-based on the interviews done and questionnaires given to prospected customers, data’s on the demand were gathered.

Micro segmentation- the marketing segment will focus on the Overseas Filipino community and households who are working very hard to give the best among the best for their families here in Rome and those who remains in the Philippines. We will provide them our quality product that creates quality Kangen Water. Having one (product and getting)-to- many(model) yet single segmented customers will help us give sharp focus and concentrate on the demands of our customers. This chain will guide the business partners to mainly monitor and evaluate on the market segment we choose.

INDUSTRY ANALYSIS

Competition

After few observations and research, we have found out that most of the Filipino households in Rome are using devices, i.e. water filtrating pitcher or water purifying devices usually bought from local vendors. The reason is they all wanted to make sure that the water they will take is clean and safe to drink. Knowing that the tap water in Rome is safe to drink, though, it’s hard and also in some cases, some water system they put so much chlorine in it. With the more affordable price of the said devices, the competition to buy LeveLuk SD501 Kangen Water machine is very high. But with all the value propositions of our product, the company where it is originated and manufactured, having all the certificates of the water industry, the value of the machine and the quality of water it creates , the payment plan that Enagic,Inc. has provided and the income in it, we believe that a greater impact on competition could be won. Taking as well into consideration that customers buying power is greatly enhanced by the benefits the machine could provide them.

Substitutes

Most substitutes which are seen threats are the bottled drinking water, home water purifiers and local vendors selling osmosis water purifier. Bottled waters can be considered low cost but if we are to compute the consummated bottled water for a day that is 2 liters(365 days)= 730 liters(.60E)= 438E/yr. x 15 yrs = 6,570E. Whereas, with LeveLuk SD501 Kangen water machine, only E3,308.00 for a lifespan of 15 years. Home water purifiers are also low cost same as osmosis water purifier but does not provide the same health merits a Kangen water machine can give. Threats from competitors and substitutes are not seen to be very dangerous.

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New Entrants

New entrants with similar product, providing the same healthcare satisfaction and financial benefit is considered to be threat to the business but the reality of that fact is very hard to imagine comparing with the mother company’s track record in creating high technology best quality water generator and ionizing machine, our product is highly competitive.

Customers

Poor healthcare and lack of additional income are two of the basic problems we will try to resolve with this business activity. Overseas Filipino workers are working hard and most of them are away from their families. The hardships are dedicated to provide good living to their families, meeting the best of their healthcare needs considering this as vital to mans’ survival. Considering the health benefits of our product, all these stimulus will motivate the customers purchasing power on procurement of the machine. Giving emphasis on the value of the machine and its quality water, disease free-family are the points they will consider for the purchase. In addition, the possibility of being a “ good Samaritan” helping other people and earning at the same time through the distribution of the machine will be an achievement for them.

Suppliers

The power, integrity and success invested on the mother company and manufacturer, Enagic, Inc., is sufficient enough for us to continue this business, the competition in the water industry is really inspiring to enter into. Enagic is in the boom of its mission, that is providing people with a better life making them physically, mentally and financially healthy.

Potential for growth

Expansion of the business from center to south of Italy. We will also expand our target market to medical doctors, hospitals, gyms, rehabilitation centers, home for the aged and skin care clinics. This business is already introduced in Milan, Bologna and Parma. In five months, 14 machines have been bought there. In addition, based on our research, there are more or less 5 Italians doing this business here in Italy and they have leveled-up. With this facts, we are keen on the vision that our business has a greater potential growth in this country and on its nearby cities as well.

COMPETITOR ANALYSIS

Name of Competitors Pricing Comparison

1. Bottled water.40E/2 liters

Plastic bottles are not biodegradeable.

2. Home water purifier UnknownNot portable for demonstrations in the market. Water it produces are not Kangen-grade water.

3. Local vendors selling Hydrogenic filtrator/ pitcher water

71.00E/36.00E Water is to be bought and its expensive.

4. Osmosis water purifier 300.00E Water created is not Kangen water.

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MARKETING AND SALES

Advertising leaflet

Enrich your life physically, mentally and financially. Enrich your environment and save the mother Earth. Choose Enagic and change your

life with Kangen water system. Drink the right water, take it from the right, best supplier. With Kangen water, you could be rich in every drop!!!

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Dry-runs---questionnaires were given, short interviews were done---impressed potential customers---willingness to avail the machine---high demand on our product.

The customers were impressed on the uniqueness and high technology adapted on the invention of the machine. They were amazed with all the benefits it could possibly give them, though some of them had commented about the high price of it. But considering the overall impact on the value propositions of our product, its value and our supplier, and the good quality service we will provide them, it was concluded that our customers were satisfied on our dry runs. Getting align with our mission, prospected clients are willing to purchase the product.

Image Our image and brand values will be conveyed by:

Easy to Use Different functionalities in one click of a button, no thick manual needed.

Portable Machine weighs about 6.3 kgs.

Engineered chamber Could be dismantle for service if needed.

Unique and modest design Pioneered with superior craftsmanship integrated with latest scientific research and innovation.

Environmentally friendly Free from use of plastic bottle container.

POSITIONING

LeveLuk Sd501 Kangen water machine will be promoted for Filipino and non/Filipino households and community members in Rome. Advertisements online will also be done.

Promotion Strategy

Product will be promoted by informing potential clients about its existing in the market. We will distribute leaflets, reading materials and demonstrations of the machine will be done as well. Ultimately, FREE Kangen Water will be distributed to potential customers. Continuous monitor and evaluation on the consumption of Kangen water will be controlled every now and then. Realization of the products’ efficiency and the satisfaction of the customers will be attained.

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Listed below is more information on promotional strategies that we will employ.

Media Type Justification Frequency

Special occassions This allows us to access new customers. 3 days/week

Cold CallThis allows us to introduce ourselves to prospective clients and eventually secure appointments.

As needed

Conferences/ Meetings (Church)

This allows us to meet with potential customers 2 Sundays/mo.

Directory (online,mobile, FB)

This will allow us to be searchable online and offline. Every time

Print We will distribute materials during events or even in our client meetings to describe our product and what it offers.

As needed

CUSTOMER SERVICE

Customer Service Description

Customer Satisfaction Feedback

We will keep in touch with customers by contacting them at least every time possible after using the Kangen water to check their satisfaction with our product and find ways on how we can improve our product or service.

Customer mentoring and development

We will keep a sharp focus on the customers evaluation of the business activity, in case of a win-win situation, that is if they wanted to be a new distributor as well.

We want to provide our customers with a payment option that proves convenient for them.

Product: LeveLuk SD501 Unit Price: E3,308.20 (VAT included)

Mode of Payment Sales Tax 19%Amount of Total

InstallmentAmount of Monthly

Payment3 payments E528.20 E2,400.00 E800.006 payments E528.20 E2,400.00 E400.00

10 payments E528.20 E2,400.00 E240.0016 payments E528.20 E1,068.00 E150.00

CUSTOMER COMPLAINT-HANDLING

Despite best efforts to please our customers, we acknowledge that there will be customer complaints. And because we believe that customer is always right and that an irate customer can be our best ally, we have outlined our action points in order to handle complaints effectively.

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Complaints Action point

Assessment This includes listening to the customer and understanding the complaint. We will then map out the issue to find the root cause of the situation to know how we can best address the problem.

Lessons Learned We will document all customer complaints, including its root cause and solution to understand whether the issues were small one-off items, or whether these are signals for a systemic but controllable risk.

OPERATIONAL STRATEGY

OPERATING PLAN

To operate the business, we need mobile phones, internet, office supplies, printing machine and supplies, fax machine and most importantly, the start-up equipments. The machine will be placed either in the residence of the partners.

LeveLuk SD501 Kangen water machine---Installment of the diverter, Setting up the unit(connect the water supply hose), Plug-in the power cord, Click on Kangen water (pH 8.5)---Run water(for the first time or after exchanging filter)slowly for 3 minutes, until the arrow comes out in the LCD(screen)---Ionized water is flowing---Share FREE Kangen Water to customers.

Demonstration will usually be on Sundays from 1-3pm(outdoor), 7-8:30pm(indoor) which include pH testing, discuss how to connect the machine properly to the faucet and putting the filter, clicking buttons for the kind of water needed depending on pH level, finally distribute water. Discuss how the compensation plan works, this is for prospected agents.

SALES FORECAST

We have 50 units sold for the first year, 18 direct customers, for a total commissions of E8,470.00. We will continue to the 2nd and 3rd year until we reach the 6A rank. Extension of target market maybe done on the 2nd year. We will extend the promotion of the product to doctors, hospitals, gyms, skin care clinics and home for the aged institutions and to nearby cities of Rome. See Annex I.

SALES VOLUME

We intend to have 100 or more unit as per group sales in the 2nd year to reach the rank of 6A. From 18 direct sales, 16 has sold 32 units. We need more or less 30 direct sales to reach our target group sale of 100 units. The only thing that hinders us from meeting that gross sale is when the direct sales becomes frozen, and even the indirect customers. Limited time on promotion and demonstration could also put us in the difficulty of attaining our target sale.

15

PRODUCTION COST

Total production cost for 3 years projected business activity is 5,421.485.00 euro. So every year there will be an amount of E1,800.30 total cost of production. Yearly FIXED COST =1,066.98; VARIABLE COST=733.32.

PRICING

The price of the LeveLuk SD501 water machine is fixed. Payment could be done in 3, 6, 10 and 16 monthly terms.

SALES REVENUE

On the first year of the business, earnings from customer segments will move upward beginning on the 3 rd month of the year. On the first 4 direct customers(new distributors), we will earn 910, 770, and 2,170 respectively. See Annex II.

FINANCIAL ANALYSIS

BREAK-EVEN

The point of break-even is on the 15th machine sold, on the month of May, 2013, 5th month of the first year of the business where the amount of income is equal to the amount of cost that is around 1,800.00euro.

CAPITAL SPENDING

Share from the partners will be the initial capital of the business. This will be use to purchase the start-up kit/equipment licensing them to independently promote, distribute and sell them in the market.

STAFF COST

Wages and incentives of the partners will come from the commissions earned. This will be divided into 2 on the end of each year.

BALANCE SHEET

It contains only the Assets since we do not have liabilities. See Annex III.

16

RISK ASSESSMENT

REFERENCE LIST 1 2009 Star Creative, LLC KangenReports.com Rev3.09

2 markcristal@yahoo.com

3 LeveLuk SD501: Reference: https://www.enagic.com/technology_products.php#p=sd501

www.enagic.com

ANNEX INDEX

Annex I. Sales ForecastAnnex II. Sales RevenueAnnex III. Balance Sheet/One-year Cost StructureAnnex IV. Income StatementAnnex V. Sample QuestionnaireAnnex VI. Reading Materials

Strengths Weaknesses

- Team has good experience in customer relationship management.- Location is familiar to the customers - Strong relationship with supplier- Partners are hardworking and skilful entrepreneurs- Supplier company is awarded by different body awards. - The business opportunity is dynamic and offers the best for clients health and wealth.

- We are a new player in a highly competitive industry.- The team needs to gain further knowledge on the product and marketing.- Business model is easy to copy.

Opportunities Threats

- To develop the program in many languages to adapt to the needs of our customers.

- Educational allowances- Less requirements needed.- Greater income.- Purchasing power of customers will greatly be affected by their emphasis on the value of health.

- Latest invention of the same machine.- International competitors can enter - New entrants.

17

Annex II

KANGEN RICHNESSSales / Revenue

Year 2013

First year Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Total

Units sold (P.S.) 1 1 1*2A 2 1*3A 2 1*4A 2 2 2 2 1 18 D.S.Comm./unit soldIns./cash/ A.R.

70105

70105 350

140210*2

210315

210315*2

280420

280420*2

280420*2

280420*2

280420*2

700 AR 5,355.00

Total P. Comm. 70 70 350 280 210 420 280 560 560 560 560 700 E4,620.00

Units sold by 1A 1 1 1 1 1 1 1 2 0 1Comm./unitIns./cash/ A.R.

70105

70105

70105

70105 175 175

70105

70105*2

0 70105

AR 840.00

Total Comm-1A 70 70 70 70 175 175 70 140 0 70 E910.00

Units sold by 1A 2nd

1 2 1 1 2 1 1 0 1 1

Comm./unit Ins./cash / A.R.

70105

70105*2

70105

70105

70105*2

70105

70105

0 70105

70105

AR 1,155.00

Total Comm-1A 2nd

70 140 70 70 140 70 70 0 70 70 E 770.00

Units sold by 2A 2 1 1 1 2 1 1 2Comm./unit soldIns./cash/ A.R.

140210*2

140210

140210 350 350

140210

140210

140210*2

AR 1,680.00

Total Comm-2A 280 140 140 350 700 140 140 280 E 2,170.00

GROSS INCOME E 8,470.00

Annex IIIKANGEN RICHNESS

Balance SheetAs of December 31,2013

ASSETSCurrent Asset

Start-up Kit 4,524.785EquipmentComputer E 850.00less: Accumulated depreciation (340.00) 510.00 Printer 50.00 less: Accumulated depreciation (25.00) 25.00 Total Assets E5,059.79

One-year Cost Structure Monthly, Quarterly,Yearly Marketing Costs

FIXED COSTS Monthly Quarterly YearlySD501 machine 55.13 165.4 661.6

Electrolysis enhancer

.416 1.25 5.00

pH tester .25 .75 3.00Pre Filter 20.00 60.00 240.00

High-grade Filter 4.4 13.3 53.3

ORP tester 2.1 6.3 25.3Chlorine Tester .29 .875 3.50

Brochures E .138 .416 1.66Brochures I .055 .166 .66

VAT 19% 4.86 14.59 58.36Shipping 1.22 3.66 14.6

Total Fixed Costs

88.859 266.707 E1,066.98

VARIABLE COSTS

Church donation 10 30 120Cellphone bill 20 60 240

Transportation 25 75 300Advertising,

printing 5.55 16.7 66.6Miscellaneous .55 1.66 6.6Total Variable

CostsE61.05 183 E733.32

TOTAL Cost 149.909 450 1,800.3

ANNEX IV

KANGEN RICHNESSIncome Statement

For the Year Ended December 31,2013

Revenues

Total units sold: 50 LeveLuk SD501 Kangen Water Machine

Personal Sales Commission 2(1A=175) E350.00 3(2A=350) 1,050.00 3(3A=525) 1,575.00 10(4A=700) 7,000.00 E9,975.00

1A Sales: 10(175) 1,750.001A2 Sales: 11(175) 1,925.002A Sales: 11(350) 3,850.00Total Sales E17,500.00less: Accounts Receivable

Personal Sales: E5,355.001A Sales: 840.001A2 Sales: 1,155.002A Sales: 1,680.00 9,030.00

Gross Income E 8,470.00Less: ExpensesTotal Marketing cost E 1,800.00Net Income E 6,670.00Less: Retained Earnings (10%) 667.00 TOTAL NET INCOME for Year 2013 E 6,003.00

Distribution of Net IncomeHaydee Lunar-Panganiban E 3,001.50Teresa Populi-De Chavez E 3,001.50

Leadership and Social Entrepreneurship 8Business Plan

KANGEN RICHNESSvia Giulia di Gallese 7, 00151

Rome, Italy

Haydee Lunar-PanganibanTeresa Populi-De Chavez

March 25, 2012 Rome, Italy

Table of Contents

Executive Summary…………………………………………………1Organization and Structure……………………………………..2-3Product and Services……………………………………………….4-5Theory of Change…………………………………………………….6Business Strategy…………………………………………………….6-9Market/Customer Analysis………………………………………10Industry Analysis……………………………………………………..10Competitor Analysis…………………………………………………11Marketing and Sales…………………………………………………12-14Operational Strategy……………………………………………….15Financial Analysis…………………………………………………….16Risk Assessment………………………………………………………17

AnnexSales Forecast…………………………………………………………ISales Revenue…………………………………………………………IIBalance Sheet & Cost Structure………………………………III

Income Statement………………………………………………….IVSample Questionnaire…………………………………………….VReading Materials…………………………………………………..VI