Proposal for Medical Supplies

By: Ghulam Abbas & Prevailing Management Team

Business Proposal Including

Financial Projection 2014-2018

Covering All GCC Countries

First Phase starting from OMAN


OVERVIEW OF OMANI HEALTHCARE

Health vision 2050 is a long term response to emerging challenges. Health Vision 2050 is aimed at radically improving the healthcare facilities in the country. As per the study and looking at the current situation of healthcare in Oman. The report published by The Director General of Planning, Ministry of Health there is a big gap between the requirement and the demand for healthcare services. Oman is providing good primary healthcare but lacking in specialized & territory care, where the Omani’s are going abroad for treatments. The government spends 4.9 percent of total expenditure on healthcare whereas the international norms are 13 percent. Ministry of Health has big plans in the current Five Year plan to expand the facilities. The major project is going to be Medical City with $ 1.5 bn investment with 2000 bed capacity, in wilayat of Barka. A Heart Center, Haemodialysis Unit and MRI (Magnetic Resonance Imaging center in Dhofar Governate. 2 big hospitals with 150 beds each at South Sharqiyah and Al Batinah Governate, 20 major hospitals and 110 healthcare facilities and upgrading the existing facilities. They are good number of hospitals coming up in private market.

• International Medical City in Salalah developed by Apex Medical Group, with a investment of $ 1 Bn, with a capacity of 530 beds.

• Sifa Al Jazeera Group has plans to have 13 medical centers with investment of RO 100 million in next 5 years. The immediate projects with RO 10 million, are coming up with 150 bedded hospital at Ruwi, 80 Bedded at Al Khuwair and another one in Barka.

• Expansion plans of Al Raffah Hospitals, Life Line Hospitals and others.


Our core purpose of this business plan is to boost up high quality products demanding in the market and development of medical equipments leading distributors with the remarkable quantified achievements, expected financial and operations over the next five years. We, basically, understand the depth of the business growth, gaps in the current market, and the unfavorable prices which are encouraging us to initiate a planned business strategy and radical change in appearance by providing the high quality of products to the valuable customers, consumers, hospitals and polyclinics in the targeted

market. After establishing a market presence with these products niche, we would expand our business with offering other related products treating and managing complications of the diseases. The market is currently served poorly and inconsistently by a patchwork of local suppliers and distributors. We will offer a regional, and ultimately national, network of clinical sales professionals, which will make us the partner of choice for large, geographically diverse chain in the medical equipments & supplies and will make us attractive to potential supplier partners.

Techniques & Strategy

• Virtual Organization to web base access to get order

• Building a strong national sales team

• Building up strong relationships

• Unique Access to sell our products in their facilities

• Adopting marketing strategies and tactics

• Managing the complications and risk factors

• Effective Channel of Distribution

• Daily, Weekly, & Monthly Progress Reports

• Mark the focus area & products line to boost up profitability

• Cost Effective

• Successful Advertisements techniques & strategy

• To achieve net profit in year one, increasing in year two, by containing costs and meeting sales goals.


Keys to Success Factors

1. We offer a comprehensive line of innovative, top quality products. 2. We provided unequaled clinical support on a regional (national)

level to post acute facilities. 3. We have close relationships with key decision makers in top post

acute chains, and with key administrators and clinicians at the facility level.

4. We do an exceptional job of articulating the value of our products and solutions. We position ourselves in a clear, powerful, and memorable way in the marketplace.

5. We have an organization with a unique spirit that makes people eager to join us or do business with us. Once people join us, they can't imagine working anywhere else.

Competition and Buying Patterns The competition and current buying patterns would help us to

develop a comprehensive study where to purchase our required

goods with cost effect ratio. On the other hand, diffidently, the

impact on such purchases would be benefited our valuable

customers to retain them for long run. We would utilize all sources

and resources for the ads, a direct mail system, mobile sms,

viewing a television advertisement, viewing a brochure, or through

word-of-mouth and forwarding our representative for confronting

them on the specific location.

Currently, no one effectively approaches this market on a regional or national level with the type of strategy that we have outlined in this plan.


MARKET ANALYSIS Political Oman is politically a stable country, with a people oriented leadership holding wide support from the citizens as a result of its policies for which it did implement for more than four decades. This stability is an important factor for the attractiveness of its market to the local investors. Economical Oman enjoyed a robust real GDP growth rate of 4.5 % in 2012, in a global situation is highly dependent on the economic policy of the leadership which is based on long term sustainability. The economy is mainly dependent on the nearly 60 % revenue from export of crude oil and is supported by manufacturing and agriculture. Oil price have shown good results in the past which created surplus funds with the government which could help the economy to grow with stable speed and surpass any difficult situations in the near future. The present oil prices are comfortably higher than the government budget assumption of oil price which is a supportive aspect to the economic development of the Country. Social The Oman society is with very positive attitude towards diverse culture and towards the expatriate community with multicultural background. Social harmony and peace are the core competence of the market which encourages investors from world over. Technological Oman market is a technologically upgrading market comparing with other developing countries. Most of the technology used in key industries like has been imported. This provides wide scope for import of high quality products. Legal The legal system of Oman is supportive to the creation of new ventures especially for the business projects by local entrepreneurs. Considering all environmental factors the project seems to be having high worthiness and matching to the changing business environment. Healthcare cost of Treatment within the GCC: Its been verified as per the GCC health commission of 2010 that the cost of treatment within the GCC as compared to India is 10% higher than the cost of treatment for specialized procedures and treatments. MT (Medical Tourism) will enhance not only allopathic and interventional treatments but also into Naturopathy or Herbal and allied Medical treatments. We can have a few MT companies in India under our empanelment that will cater to our patients from our Hospitals that will empanel with our firm’s MT program.


THE PROPOSAL This project is initiated by a detailed market research, where after to form a company to cater for the medical industry. The main result showing that there is a tremendous opportunity for growth. The project is basically planned to be a Medical Supplies unit for Medical & Equipment products. Initially, by sourcing from Dubai, Egypt, India and locally along with Promoting Medical Tourism to India by having counterparts in Medical Tourism within India. In future to have with own brands of Equipments in the longer run, which could to be made in third party factories at later stages. The project strives to create additional distinctive competence by importing high end

European brands which can be negotiated with regarding dealership. The proposal for a business model combining sourcing, Importing and Professional Marketing of high end Medical Products and the Inclusion of Medical Tourism to attract Hospitals to utilize our services for promoting Patients to visit India for cost effective treatment is a unique business model for the Oman Market. Considering the Business Environment and Business model the proposal could be a great success considering the sustainable development of the country. In this brief analysis we consider the Oman market and its proven history of sustainable development. The government policy is investment friendly and highly encouraging to local entrepreneurs. The business model could be considered as a high profit industry with an average 50% gross profit and lesser risk .The Oman Healthcare Industry is targeting increased bed capacity in coming years and it would provide scope for faster development for the medical products. The major risk in the business is the probable retaliation by price war by other leading suppliers and new suppliers, the impact of which could be minimized by the aggressive approach and better investments, better pricing and highly professional and customer oriented marketing which was a well identified strategic gap during market research. We strive to keep the competitive advantage by using most advanced technological products with a better price and customer orientation in marketing.

Private Market Dental Market Tender Business New Projects

Small Investment Small Investment Big Investment Big Investment

Day to day consumables Day to day consumables Big Market Big Market

Faster Returns Faster Returns Small Margin Small Margin

Better Margins Better Margins Takes Long Time Takes Long Time

Better Cash Flow Better Cash Flow Long Credit Time Long Credit Time

Market Size Market Size


MARKET STRUCTURE In medical products the market is dominated by established suppliers as a monopoly for the last 20 years. They are around 10 established companies, 10 medium sized companies and around unorganized suppliers in the market. The Govt tender business and the new projects are dominated by these 10 established companies. There is a great scope for good new suppliers, as there is a wide gap between customer expectation & customer service. The prices are also very high and there is no choice for the customer. Looking at the after sales service they stick to these companies. The medium sized suppliers are dominating in private market, but they do have a tough competition with un-organized suppliers. There is a great scope in this segment as most of the medium sized companies are financially weak; the un-organized companies are dependent on the medium sized suppliers. With good investments and range of products we can corner these medium sized suppliers and can bring the small unorganized suppliers under our umbrella.

Customers The major customers are Hospitals, Clinics, Pharmacies, Govt, Industrial Belt & PDO companies. The major customers are quality sensitive customers and comparatively price sensitive. We will have products of high quality and having better prices. The second important customers are construction companies who are bulk buyers but highly price sensitive. For this segment we need to have the low cost with good quality.

Competitive Advantage Cost of the products sold by us will be highly competitive with average 15% lesser price than the major competitor. With comparatively less price the products. All the imported brands are with high reputation from Europe and provide easiness to convince the top management of buyer organizations.

Differentiation All of its products are with high quality and attractive designs which are manufactured in factories with top international quality certificates. We will be based on a policy of customer orientation and believe in winning with better service and after sales support to the customers.


PRODUCT & MARKET The Division of Hospital Disposables and Surgicals plays a key role in supporting all hospitals, health centre’s, clinics, and surgeries with the inevitable equipment, instruments, devices and materials necessary to provide care for the patients. The Company believes that care is as important as the medication, and the patient can benefit from the treatment only if adequate care is given. The quality of care is dependent upon the support and materials available to the provider. This is where the Hospital Disposables Division comes in to play its role. This Division provides a range of products that include catheters, bandages, gauze pads, sutures, intravenous needles, surgical gloves, disposable syringes and needles, pacemakers and drug delivery systems, to name a few. This hospital division will make a significant contribution towards supporting healthcare in the Sultanate. All these are provided using a special logistics system that ensures vital medical supplies are always there when needed most urgently. Wide spectrum of surgical and hospital disposable products in day to day use which are tried and tested are widely used throughout. The other imported branded products are mainly from Europe which have a very good quality and high level of international reputation. The customers are very sensitive to quality and they prefer to buy high quality products with competitive pricing, which is what we plan, the products and the price. The major competitor has high quality product but at far higher price. Their negative reputation in customer service is highly repelling and our customer oriented marketing strategy is highly attractive on the other hand.

OPERATIONS Operations are executed by a team led by the GM with taking all members contribution and concerns in to account. International buying provides better price and satisfy the customer needs. Stock is controlled by a team comprising of purchase, accounts, store, sales and marketing executives to assure the maximum efficiency and avoid unnecessary buying and dead stock.

MANAGEMENT We will be horizontally integrated organization with well qualified professionals led by The Managing Director. General Manager a highly competent leadership and team could be considered as the highest value asset of the company for its future development. The organizations profile and structure are attached.


VISION We strive to be one of the Leading Organization in Oman, Providing High Quality Products and Services to the Industry. MISSION The company strives to be in Medical Supplies and Services working to encourage Better & Safer life for all our fellow Human Beings. Our mission which is to become one of the leading providers of products and services to the Industry and to provide the foundation for continuous development. To be winning, we will fulfill or exceed the expectation of our customers and principles by being adaptive, innovative, meticulous and proactive. VALUES

Please write here values


Organizational Structure

MD

GM

Finance Controller

1 HealthCare Marketing Manager

1 Bio Medical Engineer

Administration & Accounts

1 Store Incharge

3 Sales Executives

1 Bio Medical Technician

Logistics

Support Staff & Drivers

THE PROPOSAL The proposals for future development are the following.

a. Considering the high potential in the market we could go for faster development. b. The development would be in local market. c. Invest approx. One Million Omani Rial ($ 2597000) to assure faster development. d. The gross profit created could be near 30% of the turn over considering the current

scenario and there is scope to improve the profitability.


INFRASTRUCTURE BUDGET Amount OR

Office & Store advance 4,500.00

Office & Staff Furniture 3,000.00

Computer 1,200.00

Printer, Fax, Photocopy & Scan 700.00

Telephone & Internet Connection 500.00

Stationary & Printing 600.00

Racks 2,000.00

Others 2,500.00

15,000.00

Cars (4 cars and 1 van) 8,000.00

Emigration, Visa, Residency cards 2,500.00

Insurance & Others 2,000.00

Licence, Municipal and others 2,500.00

Working Capital 30,000.00

MATERIAL BUDGET (total) 100,000.00

Financial Summary To smooth line every step of business as planned, the business owner would have to invest either from his personal resources or loaning in the business field. We anticipate a first year net profit. This should grow substantially by year five. By the end of year five, the company will have a very respectable net worth. Invest approximately $2597000 to assure faster business development with 30% gross profit and outstanding profitability predicted.

Startup Requirements

BUDGET PLANNING FOR BUSINESS Amount OR

Infrastructure Budget 15,000.00

Material Budget (50+50 with 3 mnths apart) 100,000.00

Working Capital 30,000.00

Licensing & Others 2,500.00

Emigration, Visa, Residency 2,500.00

Insurance & Others 2,000.00

Cars 8,000.00

Total 160,000.00


Products The company has developed a comprehensive list of medical supplies which have frequently been

consumed in the market, priority of demand of all type of customers. Initially these products would be

arranged from dubai, Egypt, India and locally along with promoting medical tourism with the permission

of higher management.

Syringes & Needles Cotton Tubes General Instruments & Hollow Ware

Syringes 1 ml Cotton balls Endotracheal Tubes Vaginal Speculum

Scalp Vein Set Cotton Bandages Oxygen Cannule Scrub Brush

I.V Cannule Surgical Sponges Oxygen Mask Vaginal Douche Hospital Furniture

I.V. Administration Set Crepe Bandages Nebulizer Mask Ear Syringe Beds

Measured Volume contain Tubular Bandages Guedel Airways Wooden Tongue Depressor Medicine trolleys

Needles Elasticated polyurethane Bandages Suction catheter Kidney Dish Examination Couch

Sutures Orthopaedic Casting Bandage Kidney Tray Stretchers

Blades White plaster I.V.Stand I.V.Stands

Scalpels Adhesive Tape Weighing Scales Otoscope

Zinc Oxide Tapes Hammers Thermometers

Gloves Paper Tape Thermo Probe Covers Small Equipment

Supports & Braces Silk Tape Stethoscope ECG Machines

Sterilization Pouches Clear Tape Dental products Stethoscope Probes Covers Ultra Sound Machines

Sterilization Rolls Wound Plasters Dental chairs Nebulizers Autoclaves

Disp Surg Procedure Pks Plastic plasters Consumables First Aid Kits B.P.Apparatus

Drapes sets Water for Injection Suction Units

Med Recording papers Non Woven Ultrasound Gel Nebulizers

Electrodes Disp Surgical Gowns ECG Gel

Continence Products Doctors Caps Sphygmomanometer

Adult Diapers Shoe covers Large Equipment

Sharp Bin Containers Nurses cap X-Ray Units

Infection control prod Face mask Ventilators

Pregnancy Test Kits Bed sheets O.T Tables

Diabetic Foot Wear Under pads Lab Analyzers

Alcohol Swabs Sterilizers


MAN POWER PLANNING

1 st Year

Rent Salaries Cars EMI Petrol Telephone Total G.Total

General Manager 1200 200 50 50 1500

Financial Controller 1200 200 50 50 1500

HC Marketing Manager 650 150 50 100 950

Biomedical Engineer 750 150 50 50 1000

Assistant Bio Medical Technician 400 100 50 30 580

Salesmen (3) 1200 300 150 40 1690

Administration / Store 350 15 365

Driver cum Supplier 300 200 100 15 615

Assistant 200 200

Total Monthly Minimum Expence 1500 6250 1300 500 350 8400 9900

Total Annual Minimum Expence 18000 75000 15600 6000 4200 100800 118800

BUSINESS PLANIN OMR

2014 2015 2016 2017 2018 TOTAL

WITH 50% MARGIN

TOTAL SALE 250000 400000 600000 800000 900000 2950000

GROSS PROFIT 125000 200000 300000 400000 450000 1475000

EMPLOYMENT COST 54600 62400 72000 85000 95000 369000

EXPENCES 34200 39600 48000 55000 60000 236800

DEPRECIATION 5000 5000 5000 10000 15000 40000

TOTAL OVERHEADS 93800 107000 125000 150000 170000 645800

PROFIT BEFORE TAX 31200 93000 175000 250000 280000 829200

WITH 35% MARGIN

TOTAL SALE 250000 400000 600000 800000 900000 2950000

GROSS PROFIT 87500 140000 210000 280000 315000 1032500

EMPLOYMENT COST 54600 62400 72000 85000 95000 369000

EXPENCES 34200 39600 48000 55000 60000 236800

DEPRECIATION 5000 5000 5000 10000 15000 40000

TOTAL OVERHEADS 93800 107000 125000 150000 170000 645800

PROFIT BEFORE TAX -6300 33000 85000 130000 145000 386700


MAN POWER PLANNING 3 rd Year







Salesmen (3) 1800 300 150 40 2290



Assistant 260 260



MAN POWER PLANNING 2 nd Year







Salesmen (3) 1500 300 150 40 1990



Assistant 230 230




MONTH WISE SALES CASH FLOW PLANNING

1 st Year

MONTH 1 2 3 4 5 6 7 8 9 10 11 12 TOTAL

INVENTORY 50000 50000 50000 28000 178000

PROFIT MARGIN 17500 17500 17500 9800

STOCK VALUE FORWARDED 0 67500 13000 67500 10000 37800 17500

TOTAL INVENTORY VALUE 67500 62500 57500 50000 40500 28500 80500 61000 35500 77500 49000 55300 21800

CASH SALE 1500 1500 2500 3000 3500 3500 3500 3500 3500 3500 3500 3500 36500

CREDIT SALE 3500 3500 5000 6500 8500 12000 16000 22000 22000 25000 28000 30000 182000

TOTAL SALE 5000 5000 7500 9500 12000 15500 19500 25500 25500 28500 31500 33500 218500

CASH FLOW

CASH RECEIVABLES FROM CASH SALE 1000 1500 2000 2500 3000 3000 3000 3000 3000 3000 3000 3000 31000

CASH RECEIVABLES FROM CREDIT SALE 2500 3500 4500 6000 8000 10000 15000 20000 20000 89500

TOTAL CASH FLOW 1000 1500 2000 5000 6500 7500 9000 11000 13000 18000 23000 23000 120500

STND EXPENCES PER MONTH 7300 7300 7300 7300 7300 7300 7300 7300 7300 7300 7300 7300 87600

PROFIT / LOSS -6300 -5800 -5300 -2300 -800 200 1700 3700 5700 10700 15700 15700 32900

3 rd Year

MONTH 25 26 27 28 29 30 31 32 33 34 35 36 TOTAL

INVENTORY 50000 50000 50000 50000 50000 50000 50000

PROFIT MARGIN 17500 17500 17500 17500 17500 17500 17500

STOCK VALUE FORWARDED 17050 67500 4550 67500 56550 67500 37050 67500 15050 67500 67500 12050


CASH SALE 3500 3500 3500 3500 3500 3500 3500 3500 3500 3500 3500 3500 42000

CREDIT SALE 35000 38000 38000 38000 40000 40000 40000 42500 42500 42500 42500 42500 481500

TOTAL SALE 38500 41500 41500 41500 43500 43500 43500 46000 46000 46000 46000 46000 523500

CASH FLOW


CASH RECEIVABLES FROM CREDIT SALE 23500 25000 25000 25000 25000 25000 28000 30000 30000 32000 32000 32500 333000

TOTAL CASH FLOW 26500 28000 28000 28000 28000 28000 31000 33000 33000 35000 35000 35500 369000


PROFIT / LOSS 16500 18000 18000 18000 18000 18000 21000 23000 23000 25000 25000 25500 249000

2 nd Year

MONTH 13 14 15 16 17 18 19 20 21 22 23 24 TOTAL

INVENTORY 45000 50000 50000 50000 50000 50000

PROFIT MARGIN 15750 17500 17500 17500 17500 17500

STOCK VALUE FORWARDED 21800 67500 26550 67500 35050 67500 36550 67500 34050 67500 25550


CASH SALE 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 36000

CREDIT SALE 25000 25000 25000 28000 30000 30000 32000 32000 35000 35000 35000 35000 367000

TOTAL SALE 28000 28000 28000 31000 33000 33000 35000 35000 38000 38000 38000 38000 403000

CASH FLOW


CASH RECEIVABLES FROM CREDIT SALE 23500 25000 25000 25000 25000 25000 28000 30000 30000 32000 32000 32500 333000

TOTAL CASH FLOW 26500 28000 28000 28000 28000 28000 31000 33000 33000 35000 35000 35500 369000


PROFIT / LOSS 18000 19500 19500 19500 19500 19500 22500 24500 24500 26500 26500 27000 267000


THE FORECAST

The sales forecast for the Organization in Oman is given below considering, The country’s present pace of development, political stability, legal system and other factors which are out of the control of the organization could continue to be sustained. The turnover could be increased to 2 million or more by implementing the business plan professionally. The funds required would be provided on time from the corporate head quarters.

RISKS

The major risks and ways to overcome the risks are referred below. Price war

There is the risk of retaliation by price war from the market leading competent. The present profit margin and difference in price around 15% from the main competitor’s price give the economical space to survive such a situation by adjusting the price. In crucial situations the support of strong manufacturing facilities could be dependable. By stricter cost control the profitability could be increased slightly in such situations. Wider spectrum of products by introducing safety products other than PPE and oil tools could help to maintain sustainability of the revenue.

STRENGTH Infrastructure : Financial Strength Man Power: Professional with rich experience and contacts. Through knowledge of Govt statutory requirements. Experience in handling the tenders, Projects and market. Product:

WEAKNESS New company

OPPORTUNITIES MOH: Next 5 year plan is to built up 20 major hospitals / 115 health centers SQUH: Expansion ROP: New Hospital expansion Private: New Projects coming up in Oman 1. Medical City at Sallalah 2. Al Shifa Hospitals 3. Iranian Hospital 4. Apollo Hospital new project 5. Al Raffah new projects 6. Life line hospital new projects

THREATS Established suppliers in market having full range of products and good contacts New players: Market is expanding with lot of new suppliers Price war : As the suppliers are increasing the price war is very aggressive

Proposal for Medical Supplies

Health & Medicine