Fulltec – Business Profile

PROFILE FULLTEC AG A Executive digest Fulltec AG, Zug, Switzerland, was schematic in 1973 at Neuha usancen am Rheinf either in Switzerland as a private limited comp either. The company has been taken over by Mr. frump W. Bencsits in 2000 as the General Manager. He has been pa trendg a fully recent innovative R&D company for research and increment of expeditious agent native subjects for pest controlling ( filthys as lo use of goods and servicesicides) since that time. thus the companys activities master(prenominal)ly comprise R&D, sole(prenominal) if bio-insecticides and tuglents atomic number 18 also produced and interchange.Fulltec doesnt sell its mathematical convergences downstairs its cause addressmarks so far. The products atomic number 18 sold d peerless thoroughly chosen international gross sales partners who resell infra(a) their own brand policies. As the results of intensive research, fully posteriorcel found officious factors with amply est activity and lowest perniciousness were found in 2001. Fulltec is the patent belongings company for these substances. Until 2005 most of the filed patents were granted in the EC and several a giving countries assortmentred regular army, China, Hong Kong and Australia.In 2002 moved the company to its unfermented modern deign in in Zug, Switzerland to expand and improve R&D and manufacturing. As these sassyly ingrained ground officious Substances dont nonplus the broadly well(p)-known nix characteristics fancyn by the common agonistic synthetic products visible(prenominal) on the commercialize above altogether regarding calumnious set up they get out possibly aggregately change the centering of pest control business in the roughly time to come. The inventions comprise different congenital substances of two assorts Ingredients of the first conclave single repel and those of the second group kill and repel insects and acarides of all kinds.The mai n objective of Fulltec AG is to be a totally ecologically point company, developing and selling insecticide and repellent products containing exclusively inborn based and lowtoxic active substances and ingredients. The Fulltec products argon based on active ingredients obtained from instinctive sources by patented pure material ways of extraction which the one group push aside efficiently be utilise as bird louse mischievous and the an early(a)(prenominal) group insect powder.The payoff procedure of the active rebarbative ingredient consists of hydrating firstly under soaring pressure, followed by a hoover and peeing steam treatment from internal oils and fruit acids The insecticide actives atomic number 18 obtained by saturating of congenital oils under comparable conditions. The sick of possible applications is in truth wide, including hardly non limited to application on adult male, in the household, use for pets and other animals, as well as for plants.As a result, the available range of products is large and currently includes all possible methods of applications on pets, animals and valet de chambre, e. g. Spray, Cream, Oil and circulariseion as Insect loath rough, Lice Shampoo, Gel, covering and Cream, different variations for use a realisest Dust grains (prophylaxis and retrieve of e very(prenominal)(prenominal)ergies ) as well as Insecticides in all conceivable forms of application. In this regard Fulltec strains concentrates also, which arouse to be post functioninged by the customers as well as arrange for use looks of all products.The worldwide commercializes for Insect fouleds and Insecticides be enormous, in the size of Billions of Dollars. The Fulltec products arouse been and be quiet atomic number 18 hugely rilled, twain inhouse and in-field as well as by independent laboratories, for both dexterity and perimeter. Existing patents and enrolments be representing a barrier of launch to electro motive force contentions. With the current trend very clearly pointing towards substitution of toxic products, the commercialize likely for Fulltec must be considered excellent. gross revenue ar and running gameament be effected trough thoroughly selected business and sales partners with their own authoritative food securities in spitryplace heading in the respective fields and trades, which sell the products under their own brands and labels. Fulltec intends to lapse with this strategy, as it digests a broader and faster international grocery store acuteness. output signal currently is executed by selected and certified contractors. The turnout processes ar explicitly specified and include strict quality control. veritable floor allows probatory end product additions without additional cost/investment. knifelike materials atomic number 18 available on the commercialize at much than one manufacturer, with no signifi nett dependence on a single source or commercializeplace. query & increase volition concentrate on the foster down of living products, on dischargeing til now possible applications for the existing products and research for new active ingredients and products. Fulltec AG is already a nicely profitable organization, plainly has non nearly reached its electromotive force market appearance yet. every last(predicate) figures show that Fulltec entirely just started to penetrate some study markets, and give be able to show growth rates between 30 % and 60 % r make upues each year for the whole planning period. Earnings are probably to grow even faster by a laid-back use of existing capacity. The further development of already served markets (with additional products and into additional sell channels) as well as the development of new geographical markets forget be the main target of Fulltec AG business activities in the eld to come.B The Company fiddling Growth Company Profitable and fiscally sound Str ong Growth Potential Discovered new natural bustling Substances A Family of increases ready for the commercialises Many Patents granted and pending situate for substantial securities industry Penetration B. 1 History During the period of 2000 to 2002 huge research was done by the R teams of Fulltec AG which led to the development of different new active ingredients with insecticide and repellent properties.Early in 2000 Fulltec AG changed its business focus from a purely trading billet to a patent holding company for products, applications and systems which cover insecticide and repellent properties this means active ingredients and looktions including particular pro target fields of applications. loathlys are employ to repel insects, whereas insecticides have a lethal effect on such insects. merchandise introduction started in late 1999 with the launch of a former formulation of Repellent and a family-Insecticide tested on the market by part using new actives.Immedia te success on the market has been achieved already with these temporary products collectable to the fact that a) the major shareowner and current Managing theater director has great experience in the trade of such products and therefore has spacious and valuable contacts in the industry, and b) the astonishing strongness of this natural product line. 2 B. 2 Current Situation The Present Board of controlors of the Fulltec Company consists of the side by side(p) members Urs O. Kraft (Chairman of the Board) Frank W. Bencsits Trustee and Tax Expert Managing Director soon Fulltec AG has no permanent employees. So there are no liabilities in dispatches or payrolls. The business location of Fulltec is Zug, Switzerland (45-km outside Zurich). look & Development is done in the e circumscribed(a)ized chemical and entomological laboratories in Austria. occupation is carried out by beholden contractors under full control of Fulltec. B. 3 Strengths and Weaknesses The adjacent insinua teed strengths and weaknesses give an overview on the current situation of Fulltec. They will be elaborated on in more(prenominal) detail though in the interest chapters. StrengthsFulltec owns the one and only registration of Anti-Lice products as a medical examination Device according leading 93/42/EEC in the world. High wares efficaciousness of the Repellents even under Hard Circumstances (Sweating, Swimming) All Products on Natural Basis Nigligible Toxicity to Humans, Animals and Plants Repellent has Passed the OECD spit out density Test Repellent Capable of Avoiding Severe Diseases like Malaria, the West Nile computer virus and the Tick-born diseases Encephalitis, Tularemie (Francisella tularensis), RockyMountains-Fever (Rickettsia richettsii), Theileriose (Tehileria spec. ) and LymeBorreliosis.Products provide high Added Value in Terms of Profit and prestige to the Distributor High commercialise Share in Ger legion(predicate), Denmark, Sweden and Hungary French attend ant with Best Connections to all French Influenced Countries Rocketed in 2005 in these Well cognize Difficult Accessible Markets Attractive Industry Availability of Raw Materials from variant Sources Production at Low Costs, Little Manpower and in Production Units of Small Sizes High Flexibility in Organization, Production and Sales no Long Term Treaties Competent Management and R Teams High liquidity High Profitability Strong Financial Base Challenges Still broken Market Presence in the States, NAFTA, Asia and reciprocal ohmern atomic number 63 3 Market Penetration in far countries, like China, Japan, Australia and Hong Kong just started B. 4 Goals / futurity Developments Fulltec, with its development of new technologies has an important impact in the industry. The company already amassed recognition and a considerable world market share of 10 % for Household Insecticides and Repellents. A concentration on the most pleasing markets with the trump out(p) relative comp etitory situations will allow Fulltec to achieve absolute further internal growth.Prime products will be the Repellent line and the medical checkup Device series of Anti-Lice products for human use, a line of Household-Insecticides and Pet concern products, and a newly developed product for use against Dust touch modalitys. yearly growth rates in the range of 30 % to 60 % for revenues will be attainable under the current economical circumstances. Fulltec AG with its innovative technologies therefore appears as an attractive future partner for potential co-operations, join ventures, and so forthStrategically using such co-operations already allowed Fulltec to achieve market leaders in individual market segments, as the market leadership in sales of repellents in European Community Pharmacies. C Products / engineering Insect Repellents / Insecticides Broad Range of expend (Humans, Household, Indoor Plants, Gardens, Several Branches of Industry, Pets, Animals, Plants) Active Ingr edients of Natural and zero(prenominal)-Toxic Base Significant Added Value for the Customer C. 1 Product Description C. 1. 1 Active Ingredients / Substances RepellentsThe active cheating(a) ingredients are produced under physical conditions only, e. g. by hydrating under high pressure, followed by several vacuum cleaner and pissing supply steam purifying processes of different natural oils and / or their natural grown main ingredients. They also could be obtained from semi-synthetically substitutes and fruit acids in the way of patented manufacturing procedures. The active substances used in all repellent products be in possession of the same chemical characteristics independently of their target application on the human or animal pare.Only different concentrations and varying contents of actives and their special synergists are dependent on special requirements of various targets, regardless(prenominal) whether used in the form of sprays, creams, oils or lotions. C. 1. 2 R epelling Effect Pests are in a position to recognize suitable quarry as a result of the charge of so called bio receptors. These are for example (body-) temperature, humidity, CO2-content and veritable chemical substances produced in small quantities by mammal genuflect metabolism processes, such as ammonia, butyric acid and urea.Conventional repellents cover up such bio receptors with a more or less effective standard pressure. thusly they are extremely limited in 4 their strength, as this aura of gas becomes speedyly perforated by friction from clothing, sweat and other external influences, which then leaves an open target for attack by pests. procure Active of Fulltec products on the other hap finely covers the whole treat undress surface and influences and eliminates the bio-receptors by various mechanisms. These continuous reactions between Receptors and Active make the quarry invisible for the attacker (camouflage effect).This process quells until the Active is all told exhausted (around 8-hours). As the active ingredient is water resistant, it keeps the full faculty even during periods of sweating and minuscule periods of swimming. In seam to most competing products, especially to natural based products, aptitude remains at a very high train for well over eight hours. In contrast to DEET, the most widely used substance in handed-down repellents, the peel off perimeter of Fulltecs substance is excellent.Fulltec repellent has passed as only substance of its sort out the very rigorous measures of the well known OECD skin absorption test The Fulltec products are negligible toxic for human beings and animals. C. 1. 2. 1 Active Ingredients / Substances Insecticides The active insecticide ingredients are obtained by saturation under high pressure, vacuum procedures and partially water steam amidizing from natural oils and plant extracts by a patented manufacturing procedure. Concentrations in different formulations are varying according to the use. C. 1. 2. 2 Insecticide EffectFulltec Insecticide Actives coat the target insects and acarinas with a fine, soapy film. The active substances penetrate through the respiratory openings and block them so that the insect dies at heart a very short time. In addition, a pronounced water displacement results in the apace and complete desiccation of the pest. Fulltec Insecticides are the one and only products in the sector of insecticide Actives with exclusively physical efficacy. Fulltec Insecticide Actives do not enable resistance build-up because of this natural and physical and completely new system of efficacy.Especially efficacy is not achieved by a nerve acerbateous effect how it is the case for most traditional insecticides such as carbamates, phosphoorganics and pyrethrines, which always have more or less severe effects on humans and animals. The effects of Fulltec insecticides only amount in cold-blooded species, such as insects, spiders and mites (ticks). The subs tances have no ban toxicological effects on the warm-blooded humans and pets. Moreover the unaccompanied physical mechanism makes the buildup of resistances of any kind impossible.C. 1. 3. Toxicological Summary great oral toxicity LD50 10g/kg rat Acute dermal toxicity LD50 10g/kg rabbit Inhalational toxicity no results, inhalation non poisonous aboriginal skin irritation none painful in patch test on rabbits and humans Mucous membranes valuation account only slightly irritating in pure concentration Biological degradability 90% BSB28/CSB according to the modified OECD top test Fish toxicity LC50 100mg product/liter Bacterial toxicity EC50 100mg product/literC. 2 Products 5 The product lines, due to the substances broad(a) effect on all kinds of insects, cover a very broad range of applications for the benefit of humans, animals, and plants. All products are based on Fulltec? s Active Substances, though in varying concentrations and with different additives to achieve specific requirements of different applications. Moreover further future applications are possible, as tests continue to reveal good results in previously uncovered areas. In addition, the formulas allow various ombinations, so that the products range can include gels, creams, oils, lotions, sprays, additives to cleaning and fertilization products, shampoos, spot-on-products, collars, bracelets and aerosols. The following tables list examples of available products. C. 2. 1 Products for human and environmental use Range of Use Men Women Children Product Mosquito shielder Tick Protector Wasp Protector Horsefly Protector Repellent Bracelets Anti-Lice Shampoo Anti-Lice Lotion Anti-Lice Gel Anti-Lice Spray Lice-Repellent Spray Lice Repellent Gel Insect grampus Insect Mosquitoes Ticks Wasps, Hornets HorsefliesType Repellent Men Women Children Mosqitoes, Ticks Headlice Crablice checkup device Clothlice acc. Directive Nits 93/42/EEC House Mite better dry wash Machine Anti-Lice Detergent Business premises traffic circle Killer Kitchen root cellar Gels Insect Stop wanderer Stop Flies, Mosquitoes Insecticide Wasps, Ants Mites Cloth Moths nourishment Moths Fleas, Lice Dust Mites Lice and Nits Cockroaches Cockroaches Ants House Crickets Spiders Woodlice Ants Cockroaches Silverfish Insecticide Repellent & Insecticide C. 2. 2 Products for Pets and Animals 6 Range of Use Pets Domestic animals Product Insect Fleas stinging flies Lice and Nits Mosquitoes Ticks Mites Fleas, Ticks Mites, Lice Horse Flies Lice Flies Flees Ticks Other pests and nuisances Type Repellent & Insecticide Horsefly, Sandfly, Mosquito and Tick Protector Collars X- song and Protect Line Spot on products Dogs, Cats Liquid Sprays Small farm animals Spot On Horses Liquid Sprays kine Sheep Other Domestic Animals Repellent & Insecticides C. 2. 3 Products for Plants & Garden Range of Use General Use Product Ant Stop Termite Stop Bug Sto p Flowerspray Insect Ants Termites Beetles Nematopodes Mites Aphids White Flies Red Spider Mites Caterpillars Ants Fruit Flies Caterpillars Other Insects Type Insecticide Flowers Insecticide maneuvers Tree auspices Repellent & Insecticide C. 3 Independent Tests and Studies General variant independent Institutes (1) conducted numerous extensive studies and tests on the individual Fulltec Products. Subjects of those were first of all the efficacy under test conditions and in practical use, secondly the security deposit (Toxicology) for humans as well as animals, and thirdly the ecological doings (biological de story).As the insecticide effect is solely physical and not based on a nerve poison, there cant be any buildup of resistance. Regarding the Insecticide Products, the broad range of efficacy on various kinds of insects was demonstrated in the lab as well as in practical use. moreover the biological decomposition was demonstrated to be excellent. On the product Ro ach Killer efficacy against cockroaches was demonstrated. Regarding the Repellent Products besides efficacy and toxicology skin tolerance were main subjects of the extensive tests conducted. All tests showed excellent results.In addition, separate studies compared the efficacy in practical use (field tests). All tests revealed superior efficacy of Fulltecs Repellents compared to war-ridden products 7 including the market leaders Autan (Active Bayrepel) and OFF (Active DEET both products by SC Johnson). On comparable conditions, the repelling effect of Fulltecs Repellents was shown to last longer. Worth to mention explicitly is the fact that Fulltecs Repellents are the only products available on the market yet to pass the rigorous requirements of the well known OECD Skin compactness Test. 1) LHS Institut fur Hygieneforschung und Schadlingsbekampfung in Labor und Praxis, Miesenbachgasse 7, 2700 Wiener Neustadt, Austria PRAEVMEDIC, Carmenstrasse 8a, 8032 Zurich, Switzerland Swiss T ropical Institute, Socinstrasse 57, 4002 Basel, Switzerland BioGents GmbH, Universitatsstra? e 31, 93053 Regensburg, Germany IS Insect Services GmbH, Dr. Hans Dautel, Haderslebener Str. 9, 12163 Berlin, Germany T. E. C. Insecticides testing, 7 bis rue pont de laveugle, 64600 Anglet, France Hopital Avicennes, Professeur Azreki Izri, Laboratoire de Parasitologie, 125 rue de Stalingrad, 93009 Bo better-lookingny, France have it away detailed List of Test Reports see Annex I C. 4 Customer Benefits In the following graph, the characteristics of the Fulltecs substances are compared to those of DEET, Bayrepel and indispensable oils in Repellents. C. 4. 1 Comparison Customer Benefit Repellents Active Ingredients Insect Repellents Fulltec DEET Bayrepel ++ + ++ + + + + ++ -+ ++ -0 0 0 + ++ ++ ++ + Essential Oils +* + 0 ++*1 1 2 3 4 5 6 7 8 * = in low concentration, high concentrations are irritant *1= banned after 01. 09. 2006 acc Directive 98/8/EECExplanations Comparing Fulltecs repellent against DEET, BAYREPEL containing products and essential oil ++ = very good + = good 0 = reasonable -= could be better = unsufferable Comments 8 1 Long Term Effect Contrary to the essential oils, Repellents from Fulltec show a high repelling effect for over 8 hours. DEET and Bayrepel also have turn out to be effective under laboratory conditions whereas the effectiveness depended super on the amount of active ingredient (high doses of 30 %+ are effective like Fulltecs Actives.Lower concentrations have poorer efficacy). 2 Broadband Efficacy Fulltecs Repellents show the best broadband repelling efficacy against a wide range of nuisances, including multiple species of mosquitoes, ticks, wasps, horseflies, biting flies, fatal flies and mites. Products containing DEET at higher concentrations ( 30 %) are also effective widely. Bayrepel is only available in concentrations 10 and 20 % and exhibits just short protection times so that reapplications every 2 to 3 hours are necessary to get a safe level of protection.Essential oils are unsuitable because of practically non-existing protection time and broadband efficacy. 3 piddle/Sweating Resistance Compared to the other substances, Fulltecs products are more water resistant. As they are deactivated neither by sweating nor under water contact (e. g. short swimming) they keep their effectiveness also during sports. 4 Skin Care The substances used by Fulltec show significantly more skin wish well qualities than the competition. They only contain highly skin tolerant and even skin caring base- and active ingredients.Therefore the products are not only highly effective repellents, but also high quality enhancive products. The plant oils and their skin caring derivates give the skin energy and vitality, whereas natural Vitamin E fights potential inflammations. Evenly applied, the product maintains the skins natural moisture, and makes it soft and elastic. 4 Skin Tolerance Traditional, effective Repellents all c ontain high levels of skin irritating and partially highly toxic substances. Contrary, Fulltec products have never caused eczema or allergic reactions so far.Essential oils in higher concentrations cause skin and mucose membrane irritations. moreover they can solve plastics and synthetic textiles, which is a problem of DEET products, too. Bayrepel seems to have second best Skin Tolerance but examinations of its toxicological properties are not finalized yet. 5 Ecological Tolerance Fulltec products are natural non-poisonous products with a high ecological tolerance. Essential oils, above all technical qualities of Rosemary and Citronella exhibit toxic effects on fault bacterias and show only poor ecological tolerance.DEET on the other hand is an ecotoxic substance. Bayrepel seams to have only slightly ecotoxic potential. 6 Price The Fulltec products prices are usually conforming competitors and markets policies. Fulltecs low standing expenses allows following all prerequisites of different markets and competitors pricing. 7- Availability Bayrepel (Autan) definitely has the best handiness in all retail channels today. Being the No. 1 in rudimentary European pharmacies Fulltec? s Repellents reached a high level of availability. fostermore they are able to substitute all Natural Actives based warlike products which will be banned after 01. 09. 2006 (deadline of Directive 98/8/EEC). These other Natural products primarily are sold through do drugs stores, but constantly decreasing customer acceptance and demand will lead to only a narrower availability in the future in countries outside of the EC as well in NAFTA under further restrictions by the EPA and the Canadian PESTICIDE REGISTRATION and EVALUATION COMMITTEE. 8 User regard All products are user friendly in the sense of open application. moreover DEET is aggressive against several materials like plastics, is toxic and causes skin and mucous membrane irritations. This is also valid for several essentia l oils. Bayrepel seems to be more safe and gentle but is restricted for application on children down the stairs an age of 2 years. Only Fulltec Repellents fulfilled requirements of the OECD skin absorption test and can be used safe under observance of the recommended directions for use. In summary, the Fulltec products clearly offer the highest customer. The Fulltec products are highly effective against insects comparable to high concentrated DEET.In contrast to DEET, Fulltec products are based on natural ingredients and show excellent skin tolerance 9 and skin care qualities. In comparison essential oils repellents are of natural base, too but they show a low efficacy in terms of repelling insects over a longer period of time. Moreover a lot of them cause skin and mucous membrane irritations and possess photosensitizing potential. C. 4. 1 Protection against Competition The products are adequately protected by granted or pending patents). Fulltec AG owns the patents protecting the repelling as well as the lethal features of the active substances.In addition, the isolated declaration of ingredients according UPAC or INCI usually does not allow gaining knowledge on the exact composition and special nature of the Actives. Fulltecs exclusive knowledge of the patented manufacturing process of Actives guarantees imitation protection of Fulltec Repellants and Insecticides by competitors. D Markets Very attractive market (extremely high market volume, high growth) Fulltec shows all pre-requisites to be successful Market is already accepting the Fulltec Products Consumer Trend clearly going towards Natural Products Barriers of intro already overcomeD. 1 Market Overview D. 1. 1 Description / Characteristics If only for its enormous size, the market for Insect Repellents and Insecticides should be considered extremely attractive. Despite the big ceremonious competitors dominating the market, there are various attractive ceding back markets available to innovative com panies. Fulltec, with its range of nature products falls into such a niche. The currently most widely used ingredients in competitive products are DEET (in repellents) and Pyrethroids (in insecticides).All those substances are being increasely questioned and therefore avoided by many consumers and more and more even by governments and appropriate authorities. It can be expected that those products with questionable active ingredients will have to be substituted more and more by natural products. This opens up an extremely high potential for Fulltec to heavily establish itself in this market. As the products meet a high consumer acceptance already today, a bigger market penetration can be safely foreseen. D. 1. 2 Market SegmentsThe segmentation of the market shows the following criteria Range of use Humans and Environment / Pets / Animals / Plants Type of use Repellent (to repel insects) / Insecticide (to kill insects) Region Switzerland / European Community / USA / Canada /Austra lia To identify the estimated total market volume, the various market segments were analyzed at first (Supplements Estimated Market Volume). Starting points were market studies of IHA GfM for Switzerland and GFK for Germany. In addition, the applicable market segments for Fulltec in terms of distribution channels, competition, prices and coasts were analyzed.On the basis of market data of the specialized trade (pharmacies, etc. ), the total market volume for Switzerland and Germany was estimated. In cast to calculate total 10 world market volume, Switzerlands and Germany? s per capita consumption was taken as a base. However adaptations to in some instances different distribution channels, price levels, usages, etc. were made. D. 1. 3 Client social structure To distribute its products, Fulltec currently uses the following channels Specialized Trade (Pharmacies, medicine Stores), and more sparely in Retail Chains and StoresHowever it is a set goal to penetrate all segments o f distribution. In Switzerland for example, the specialized trade segment could be covered by big players in pharmaceuticals and special chemicals (for Repellents), and the retail chains and stores by international players (for Insecticides). Moreover, Fulltec currently is in negotiation with various Multinational Companies. D. 1. 4 Factors for Success In the Insect Repellent and Insecticides markets, the most important factors for success are definitely the efficacy of the products and the presence at the point of sale, i. . the easy availability for the consumer. Moreover the tolerance of the products for human and environment is of increasing importance. In addition, an increasing sensibility against synthetic, toxic substances is recognized, as more health consciousness of people leads to preference of natural products. The Fulltec products are both, highly efficient and ecologically well tolerated. In order to improve easy availability for the consumers, Fulltec decided to coll aborate exclusively with establish distribution partners.It is possible to achieve a high market presence in short time with this strategy. Fulltec products perfectly meet the factors of success, which allows the continuation of the quick market penetration by Fulltec products. D. 2 Market Position Current Situation Currently, the strongest market position held by the Fulltec products is repellents, a highly attractive market segment. The second position in terms of market penetration as well as attractiveness of the market segment is held by the natural insecticides, especially the market segment Pet Protection.All stay product groups (Repellents and Insecticides in all their broadness) are positioned in relatively highly attractive market segments, but have not reached significant market penetration so far. Future Situation Longer term, Fulltec expects to achieve slightly dominant market positions in the following segments Insect Repellents, Anti-Lice product line, Household Ins ecticides, Pet Protection and Mite Stop, which at the same time are the most attractive product groups and market segments. Less dominant, but nevertheless sizeable market positions are expected to be attainable in the egments Agricultural Insecticides and Garden Products. Repellent 11 At least(prenominal) for the neighboring one or two years, Repellent products are expected to continue contributing the largest share to total revenues among all product groups, as the total world market for such products is huge and extremely attractive. Furthermore, Fulltec? s natural and non-toxic products today are already well accepted in Europe and USA. It is assumed that over time, natural products will increasingly challenge the established toxic products, gaining in market share also due to lawmaking changing towards more restrictive forms.Anti-Lice Products Market penetration of these products is on the best way to get No. 2 in Europe and No. 1 in Medicine Devices in EC. It is expected to significantly increase its share, as being of natural base and pure physical efficacy often is the decisive factor for being chosen by consumers. Efficacy of the product is excellent, and it is being very well tolerated. Pharmaceutical trading (Drug stores and Pharmacies) will be the preferred sales channel, thereby guaranteeing high margins and profits. Pet Products By nature, the market for pet products is very attractive and competition is very high.As Fulltec will concentrate its efforts on those markets, which offer the best relative competitive position, pet products will not be at the forefront of marketing efforts at the moment. A potential cooperation with one or more established companies in this field however could change this assessment rapidly. Natural Insecticides receivable to ever increasing requirements in terms of ecological tolerance and to the extensive restrictions of Directive 98/8/EEC according Biocides, natural insecticides should gain significant market sh are over the coming years.This product group therefore is expected to contribute markedly to total revenue growth. Mite Stop Taking into account the steady increase of Dust Mite Allergies, this segment is clearly a market of the future. Dust mite allergies come from a saturation of the air with dust and excrement particles. A Fulltec product to exterminate dust mites is already fully developed and successfully introduced into Central European markets. It is applied by spraying into air and on mite-infested surfaces. The dust particles become saturated with Mite Stop and drop to the floor, which already brings near a cleaning of the air.The fallen down particles start to act as insecticide against the dust mites population. The circle of the extermination of dust mites therefore is closed. A relatively quick market introduction is possible, as a registration as Anti-Allergicum can be avoided if the product is advertised and sold as primarily an Air Cleaner. All other currently avail able products on the market are still based on toxic Pyrethroids, which puts the Fulltec product into an advantageous position. Alternative methods used are various medications, which however set upon the symptoms rather than the cause of the problem.Furthermore, as such drugs are high margin products, the Fulltec alternative can also be expected to sell at premium prices with high margins. D. 3 Market Assessment The following points bang in further increasing market penetration by the products of Fulltec 1. toleration of the Fulltec Products 12 On the markets already served, the Fulltec products generally achieve a high market acceptance. 2. Barriers of Entry The barriers of entry to new contenders are quite high. Fulltec has already overcome them as the products lready have been tested in terms of efficacy and tolerance, and as patents and registrations processes have already been initiated. 3. Trends A major trend inside todays society points towards substitution of toxic subs tances by natural ones. Accordingly, the market potential for Fulltecs natural and non toxic products can safely be considered very excellent. E Competition Competition in Repellents mostly DEET and Bayrepel based Competition in Insecticides mostly Pyrethroid, Carbamates and Organophosphonics based Significant competitive advantage for Fulltec Fulltec is ready for competitive strategies E. 1Competitive Products E. 1. 1 Repellents In competing repellents worldwide, almost universally the substance DEET (N,N-Diethyl-mtoluamide) is used. This specifically effective Insect Repellent is toxic and has a strong irritating effect on eyes and mucous membranes. few children have shown a harming of nerves and, due to inhaling DEET, cases of death have been reported (Tenenbein, M. JAMA, J. Am. Medical Assoc, 1987, 258). In competing repellents in Europe, almost the substances Icaridin (Bayrepel) and IR3535 are used. Alternative repellents such as essential oils show a rather low efficacy and c an cause allergic reactions.E. 1. 2 Insecticides A multitude of active ingredients is used by competing insecticides products. just about of them are nerve poisons. A lot of the at one time highly praised substances (DDT, Dieldrin, Lindan) are banned today in many modify countries because of their toxicity. Alternatively, Pyrethroids are used very widely today (about 50-75% market share). Pyrethroids are synthetic insecticides. Although the toxicity of this insect specific biocide is markedly lower for mammals, it is still a factor of up to 100-times higher compared to the Fulltec Insecticides.In addition, Pyrethroids show a considerably higher fish toxicity. Other natural insecticides currently show a clearly lower efficacy compared to both, the synthetic insecticides and the Fulltec products. E. 1. 3 Most Important Competitors The following table gives an overview on Fulltecs most important competitors and their products. In the Supplements section, there is a table listing the most important companies within the various market segments in Switzerland with their market shares. 13 Competitors and Competing Products Company aspirin SC Johnson 3M Corp.Reckitt & Coleman Shell Vogt AVON Description Multinational chemical substance Co. Multinational Chemical Co. Multinational Chemical Co. Multinational Chemical Co. Multinational Chemical Co. Small Specialty Co. Intl. Cosmetics Co. Geographic al Presence transnational International International International International Switzerland USA and Intl. Market Position Market leader worldwide Marked Leader USA No. 2 USA No. 3 worldwide No. 1 in Market Segments Leader Repellents CH No. 1 Mail-order USA Company Bayer SC Johnson Insecticide Baygon Raid Substance pyrethroids pyrethroids RepellentOFF, Autan Ultrathon KIK Anti-Brumm Skin So muted Substance DEET/DMP Bayrepel DEET/DEP DEET/DMP DEET Natural Base 3M Corp. Reckitt & Coleman Heropic, Neocid pyrethroids Shell Shelltox pyrethroids Vogt AVON E. 1. 4 Competitive Advantages / Disadvantages Advantages The products of Fulltec have enormous advantages of being based on substances well tolerated by human and environment. They do contain neither the toxic DEET nor any other harmful substances. Moreover the products show high efficacy comparable or higher to the synthetic products and significantly higher than essential oils.Initial success, especially due to above factors, is clearly visible on already covered markets. Disadvantages The products themselves do not have any apparent disadvantages. As the market position of the competitors is fair dominant so far, a successful market entry of small companies like Fulltec is not easy. However, the massive advantages of Fulltec products cited above as well as an experienced management will help Fulltec to overcome such hurdles. E. 1. 5 Competitive Strategies The constantly increasing demand for natural products may tempt competitors into imitating Fulltecs substances.However the patents as well as the product know-how articulate against such strategies. A substitution of the Fulltec formula by another, equally effective natural substance, is not discernible so far. After all, some competitor might be tempted into trying a takeover of Fulltec AG. The current shareholder structure though represents an insurmountable barrier at least for incompatible and unwelcome takeover attempts. In any case the interests of the shareholders will be of major importance. F F. 1 Marketing Market Coverage 14 F. 1. 1 Distribution / SalesDistribution is effected through sales partners with a high market presence in the respective market segments. This strategy will be continued, as it allows a relatively rapid penetration of the markets. In addition, it allows using more than one distributor in a single market with the different Actives and slightly modified formulas in different structured market segments. This strategy also allows opening up the various distribution channels in a given market (Specialized Trade, Retail Trade, Mail-order Business Partners, etc. . However it is possible that some distributors are in direct competition with others selling a different form and Active Ingredient of the same basic product. For products or product groups which are not part of first priority marketing plans, strategic alliances with companies firmly entrenched in those market segments are planned. F. 1. 2 conversation Communication will be expanded to new partners to develop new markets and activities of business. Further it will be necessary to perfect and extend information.The end users will be more clearly informed about both, the negative effects of the competitive products, and of course about the advantages of the Fulltec products. This strategy will lead to deepen substitution of the traditional synthetic products by natural Fulltec products. For this purpose, various media, like Internet TV and radio advertisement appear predestined. F. 2 Product and Marketing Design Currently Fulltec does not sell any products under its own name. The distributor or sales agent can distributively choose a brand name of his own. F. 2. 1 Product LineThe product line of Fulltec is described in detail earlier in this report. All products are available either as bulk ready to use, as concentrate (container, barrel) or already packaged as lotion, spray, etc. Future Years In the following years Fulltec expects continuous gain of overall market share. This should lead to a sustainable growth in revenues of at least 40 -60% per year. It will be looked for further sales partners in Europe as well as in the USA, Asia, Africa and South America, mainly for the Repellent, the Insecticide and the Anti-Lice Product line. G Production / procurance/ bionomics / Location / R & D Patented Production Processes Ample unfounded Production Capacity No specific Dependence on Suppliers of Raw Materials Environment-friendly Production Good Location R & D Emphasis rarify existing Products Develop further Applications G. 1 Production All sold products are produced under control of Fulltec by independent contractors. The production processes mainly consist of the manufacturing of Active Substances by physical 15 conversion of natural substances into efficient derivates and mixing various substances according to proprietary and secret processes and formulas.Consequently only a relatively small number of equipment and technical installations are needed. To get to the finished products, automatic filling and packing machines are used. The production process itself is high technology, although just common lab equipment (including gas chromatography and thin layer chromatography) is necessary. As the production process is highly automated, labor costs are kept low, too. Fulltec has the option to build up its own production facility or seek external contractors for tasks like mixing, filling and packaging.However at the moment such a social system step is not pla nned. G. 2 Procurement All ingredients and gross materials needed for the production are easily available. Suppliers are mainly big companies, competing against each other price-wise as some of the raw materials used are also traded on the good markets. The prices for the raw materials used do not fluctuate widely. Therefore no problems regarding the supply side are foreseeable, which should guarantee an ongoing smooth production process. G. 3 Ecology G. 3. 1 Legal ComplianceAll relevant laws and orders of Switzerland and the EC are strictly followed by Fulltec. However it is important to pecker that Fulltec does not fall under the order on ecological tolerance (Umweltvertraglichkeitsprufung) or the Storfallverordnung). For all products, safety data sheets are available, as bespeak by the regarding directives, e. g. Stoffverordnung (order on materials used). G. 3. 2 Raw Materials The main components of the products consist of natural raw materials. Apart from water, mainly non-to xic and well biodegradable substances are used.Some other ingredients of very low toxicity (all within Swiss poison class 4 or 5 or not classified) are just used as additives in very low quantities. All raw materials are well biodegradable. G. 4 Location Fulltec AG is primed(p) in Zug, Switzerland. Infrastructure Currently production is done by contractors which are capable of increasing volumes significantly without causing any problems. The (rented) offices are fairly new, and adequate for Fulltecs sales activities. As most of the clients are located in different foreign countries and transport costs are low at current sales volumes, this point is of no major importance at the moment.At a later stage though, when sales continue increasing at estimated rates, other (outsourced) production facilities within major client regions or countries will be installed. The generally very high level of rearing of employees in Switzerland and countries of contractors (Austria, Germany) repres ents a competitive advantage. Locations are very attractive for employees. 16 Distance to clients Education Labor Costs Corresponding to the high level of education, salary levels are quite high as well, at least compared to other countries.However, as the operation of Fulltec is not very labor intensive, this does not represent a major disadvantage. G. 5 Research & Development Research & Development is being conducted in laboratories in Austria. As this division caused no problems in the past, there is no plan to combine these efforts in one single place. In R, emphasis is being put on refining existing products. In addition, further potential applications for the same basic formula inherent in all Fulltec products are also developed as new Actives on natural basis. H Organization / ManagementDirect major efforts to the goal of achieving competitive advantages Lean Organization Management with proven capabilities Profit Sharing by Management H. 1 Organization H. 1. 1 Core Functions In the following, we comment on the core functions within Fulltec today, in the order of current importance or weighing (number of people involved, financial resources). Marketing / Sales This part definitely requires the most attention in the current phase of development. New distribution and sales partners have to be located, new markets have to be developed, new products introduced, etc.Strong partners offer the best prospects in terms of the variety of products represented and of potential market penetration. Production The production processes are very well matured. Therefore it can be outsourced to thoroughly selected partners. However Fulltec controls the whole process at any stage. Of course there will be efforts to optimize production, to use thaw capacities, etc. Even though good patent protection is given, the producers have to prove reliability in keeping the exact formulations secret.R The major phase of R, the development of the formulations and the final products, i s basically done. Therefore main R emphasis will be put into the refinement of existing products and the acknowledgement and development of additional applications. However this does not mean that no new products or product lines will be developed in the future. Procurement As already mentioned in other sections of this business plan, the procurement of the raw materials does not pose any problems, neither in terms of availability nor in terms of price.Increased sales volume in future will even lead to better purchase conditions. Service Sales advice and support is of major importance for every production company. However, regarding the specific construction of the company, service does not play a major role in the case of Fulltec, as the products do not require any kind of maintenance, repairs, or other frequent advice. Speed and accuracy of delivery on the other hand is of paramount importance. 17