Business Plan

Castle Soap & Co

Stay safe and Stay cure

Business Name: Castle Soap & Co

Address Line 1: 140, Raybazer, Dhanmondi, Dhaka-1209
Address Line 2: 8/A, Dhanmondi, Dhaka-1209
City, ST ZIP Code: 1209
Telephone: +8801748966243
Fax: +88-02-98440
 Table of Contents

E‐Mail: castle_soap@gmail.com
Executive Summary...................................................................................................................1
1.0 Introduction..........................................................................................................................2
1.1 Mission.............................................................................................................................2
1.2 Keys to Success................................................................................................................2
1.3 Objectives.........................................................................................................................3
2.0 Company Summary..............................................................................................................4
2.1 Company Ownership........................................................................................................4
2.2 Start-up Summary............................................................................................................4
Table: Start-up....................................................................................................................5
2.3 Company Locations and Facilities...................................................................................6
3.0 Products................................................................................................................................6
3.1 Product Description..........................................................................................................6
4.0 Competitive Comparison.....................................................................................................7
5.0 Technology...........................................................................................................................8
6.0 Future Products....................................................................................................................8
7.0 Market Research and Analysis.............................................................................................9
7.1 Market Segmentation.......................................................................................................9
7.2 Industry Analysis.............................................................................................................9
7.2.1 Distribution Patterns..................................................................................................9
7.2.2 Competition and Buying Patterns...........................................................................10
7.2.3 Main Competitors....................................................................................................10
7.3 Target Market Segment Strategy...................................................................................11
7.3.1 Market Needs..........................................................................................................11
7.3.2 Market Trends.........................................................................................................12
7.3.3 Market Growth........................................................................................................13
7.4 Marketing Strategy.........................................................................................................13

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Executive Summary
Castle Soap & Co has designed a new product that provides managers with a quick, easy,
and affordable method to effectively monitor employee hand washing. Proper hand
washing is the most effective preventative measure available to combat communicable
diseases.

Improper hand washing contributes to more than 5 thousand deaths in Bangladesh

each year through the transfer of communicable diseases in restaurants, day cares and
hospitals (more than AIDS and breast cancer combined). Studies have shown that proper
hand washing procedures in these environments could cut down the spread of disease by
up to 75%. The greatest contributing factor to this problem stems from the inability of
supervisors to monitor and control employee hand washing. Existing products offer no
effective or affordable solutions for enforcing and ensuring hand washing compliance.

Castle Soap & Co is the first producer that answers this problem and provides
indisputable proof every time a person washes his or her hands. After washing occurs, the
unique dye in our soap remains on the hands and fades to the skin's natural color in under
six minutes. This would allow supervisors to conclusively verify at a glance whether hand
washing has taken place. No other product on the market offers such a high level of
assurance of sanitation compliance.  The product is safe and meets all current FDA
regulatory requirements for soap.

Although restaurants and hospitals have tremendous market need for a product such as
ours, day cares represent the best opportunity for our initial target market. Day cares are
an ideal market because they have a vested interest in reducing disease transfer amongst
children, and have adamant support from their clients [parents] to create as clean an
environment as possible. As stated by Family Practice News, "Most day care centers are
sophisticated little germ factories, exchanging bacteria and viruses with the shake of a
hand or the sharing of a toy. And many of those nasty bugs travel home where they can
infect the rest of the family.

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1.0 Introduction
Castle Soap & Co boasts a strong founding team and experienced board of advisors. Our
primary advisor, Ferdus Wahid , brings two years of industry experience and networked
relationships to accelerate market penetration of the product line. Castle Soap & Co will
outsource the production of its soaps to an existing soap manufacturer. The executive
team will first target the Dhaka City area and eventually the greater Chittagong City using
direct sales and distributor channels to penetrate the market. Initial capital will be used to
test, patent, approve, produce, and market, as well as provide working capital for the first
year.

Castle Soap & Co will follow three concise strategies to achieve our desired growth:

 Exploit first-mover advantage in a highly fragmented market with a unique and

differentiated product.
 Develop a strong branding campaign to build awareness, positive perception and sales
of our products within our target markets.
 Continue to develop new products to satisfy an ever growing set of markets.

Based on detailed financial projections, Castle Soap & Co will require 3, 00,000 BDT in
start-up capital, but will generate positive cash flow in October, Year 1. By the end
of Year 3 the company will be generating 850,000 BDT in sales with sizeable net profit.

1.1 Mission
Our mission is to create value for customers by continually improving health
and reducing preventable illnesses through the use of our soap.

1.2 Keys to Success

 A first-mover branding campaign to build awareness of Castle Soap & Co’ s

products as the standard for ensuring hand washing compliance.
 Patent protection to defend our time-sensitive dye and product concept from
competitors.

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 Complementary relationships with organizations interested in increasing hand

washing compliance.

1.3 Objectives

 Develop a complete prototype which meets regulatory standards by April of Year 1

 Become the specialty soap of choice for day cares across the Dhaka City by
December Year 2.
 Achieve sales of 5 million by the end of Year 6

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2.0 Company Summary

Castle Soap & Co was founded in Dhaka City, Bangladesh and created as a Private
Limited Company as a Partnership with 4 partners, Name are Ferdus Wahid, Mosleh
Uddin, Nandita Das & Rifat. Castle Soap & Co develops and markets soaps utilizing
time-sensitive dyes promoting sanitary and safe environments to businesses and parents
interested in maximizing cleanliness. The company will initially be based out of a
residential apartment in Dhaka.

2.1 Company Ownership

The executive team will retain at least 70% of the equity in the company. Every 2,500
BDT of investment in the company will secure up to 1% equity in the company. Ferdus
Wahid will retain 25% ownership, Mosleh Uddin will retain 25%, Nandita das will retain
25% and Rifat will retaining remaining 25%.

2.2 Start-up Summary

Total funding required to get the business started is estimated at 3,00,000 BDT of which
the executive management team - Ferdus Wahid will invest 75,000 BDT , Mosleh Uddin
75,000, Nandita will invest 75,000 and Rifat 75,000 respectively.

The key elements in the start-up plan for the company are:

 Development of a working prototype.

 Funding of working capital requirements and promotional materials for the principal
operating activities of the company.
 Gaining patent approval.
 Establish a strong brand image early to position ourselves in the market.

Our start-up period includes 5 months of work by an independently-contracted chemist at

a local lab who will perfect this design into a finished prototype, with the correct balance
of soap and dyes in four colors. The final two months of this start-up period include
safety tests per government regulations to assure high quality.

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Table: Start-up

Start-up Amount BDT

Requirements

Start-up Expenses
Legal 25,000
Stationery etc. 100
Brochures 15,000
Consultants 1,000
Insurance 500
Rent 0
Website Development 450
Research and Development 100,000
Expensed Equipment 250
Other 11,000
Total Start-up Expenses 153,300

Start-up Assets
Cash Required 86,700
Start-up Inventory 50,000
Other Current Assets 10,000
Long-term Assets $0
Total Assets 146,700

Total Requirements 300,000

2.3 Company Locations and Facilities

The management team of Castle Soap & Co will initially use a residential apartment in
Dhanmondi to run operations. In Year 2, we will move to a rented office. Distribution
will remain outsourced.

3.0 Products
Castle Soap & Co’s product line provides a unique control level to managers, supervisors
and parents alike. We have two basic product lines: CHILD Castel), intended for day care
facilities, and an antimicrobial-based product for hospitals (HEALTH Castel) and restaurants

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(FOOD Castel) - the antibacterial products are not yet in development. The various product
lines, competitors and future product possibilities for Castle Soap & Co will be outlined in
the following section.

3.1 Product Description

 Castle Soap & Co will produce a line of institutional liquid soaps with a time-
sensitive dye blended into the mixture.
 The dye reacts with the hands during the lathering process, staining the hands a
distinct color, then fading in less than six minutes.
 The product will sell for approximately 280/case. (4 gallons/case)
 The packaging will be compatible with existing soap dispensers mounted in washing
stations and be available in a variety of sizes.
 Initially, Castle Soap & Co will produce products with child care acquirers in mind,
utilizing the brightest colors possible. This product line, called CHILD Castel, will
consist of four colors: red, blue, pink and green.

4.0 Competitive Comparison

 Castle Soap & Co’s products offer a high value alternative to other hand washing
compliance products.
 They provide an unprecedented level of control, allowing these managers to monitor
and follow hand washing frequency and habits of both child-care workers and
children. Ultimately this can lower costs for all users, either in a workplace or private
Environment by reducing the risk of disease outbreaks and/or health code violations.

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 As the first fading dye hand soap in the market, Castle Soap & Co will build brand
identity, establishing the company as the standard for improving hand washing
compliance.

 As Castle Soap & Co’s products become more familiar in a workplace environment,
the product will begin to produce a pressure on employees, whereby they feel
compelled to wash their hands out of a consciousness about the perception of all
employees, not just managers. This "peers pressure" effect will further fuel the use of
our products and the recognition of the benefits they deliver.

5.0 Technology
The technology of our fading dyes will be pivotal in the success of our company.  The
interactions between fading dyes and antibacterial or anti-microbial bases suitable for use
in restaurants or hospitals are more complicated than the interactions with the glycerin or
lotion soaps utilized in the CHILD Castel line. As soon as cash flow permits, projected to
be in 2017, Castle Soap & Co will employ a professional chemist with experience
developing dye products to further the research into technological innovations that may

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produce antibacterial and anti-microbial versions of the soap to address additional

markets.

6.0 Future Products

Additional soap products, manufactured to comply with regulatory minimums for
strength and effectiveness in their respective target markets will be developed to
address restaurants and hospitals. These soaps will be trade marked under the names
FOOD Castel and HEALTH Castel, respectively.

Perhaps the most promising future market opportunity for fading dye soap is the retail
market. This product line will include soaps using the same or similar dye colors as the
day care to encourage children to wash their hands more often at home. This will be a top
priority when the company develops the financial resources enough to mount a national
advertising campaign and distribution system. A complete line of fading dye
products could potentially be developed, including floor, counter and body cleaning
products that use fading dyes to indicate places on a surface that may not have been
cleaned.

7.0 Market Research and Analysis

There is tremendous potential for a product that provides supervisors and parents with the
control to monitor and encourage hand washing. Considering the large scope of our
potential markets, we feel it is imperative to focus our limited resources on a particular
geographic region where we can establish demand for our product. After successful
market penetration, we will begin implementation into the restaurant and hospital
markets.

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7.1 Market Segmentation

Castle Soap & Co’s first product line addresses the day care market. CHILD Castel will
first be introduced in the Dhaka City area, before sequential expansion to additional day
care markets. There are currently 200 day care facilities in the Dhaka city area. After
successful implementation in Dhaka City, we will begin expansion into the greater
Chittagong City.

Successful penetration into the day care market will be followed by implementation into
the restaurant and hospital markets. There are currently 5,000 restaurants in the Dhaka
City, followed by health care services.

7.2 Industry Analysis

The Industrial and Institutional soap industry, of which we are a part, is quite fragmented,
but contains several well known main competitors: Uniliver, Detol, and Savlon, as well as
generic brands that provide to distributors like Life boy Hand wash. The industry is stable
and growing; between 1998 and 2003 it grew by an average of 4% annually. Within the
I&I sector there is fierce competition for market share among the existing popular soap
offerings, leading to lean profits on soap sales.

7.2.1 Distribution Patterns

Distribution in the soap industry is provided by regional providers. These distribution

companies usually serve a large portion of the market based on the respective size of the
market, delivering to the organizations monthly or bi-monthly depending on demand and
usage patterns. Food services typically receive deliveries of cleaning products once a
month. Hospitals typically have a distribution system that operates on monthly deliveries
of large quantities. Restaurants typically have a weekly delivery schedule.

7.2.2 Competition and Buying Patterns

Commercial customers select soap based on the necessary minimum safety regulations
for the intended user; restaurant and hospital regulations require anti-bacterial/microbial.
Customers will typically select a product based on price, distributor availability, and
convenience. Distributors will deliver a complete order of cleaning and maintenance
products to customers. Major competitors sell to a variety of customers, including

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distributors like Unilever, who receive generic soap from bulk producers, then repackage

and deliver it along with other products it sells, utilizing the same distribution systems.

7.2.3 Main Competitors

Traditional soap producers

Soap is a common and familiar the commodity of necessity to every company. Traditional
soaps employ pleasant scents and dyes to encourage hand washing compliance. However
there is no way to verify if hand washing has occurred and traditional soaps do little
beyond the pleasant scents to encourage hand washing.

The largest current soap producer, Unilever, consistently achieves strong sales, and has
enjoyed strong market share in the commercial markets. Producing a wide variety of soap
products, Unilever has maintained 18% in market share over the last decade. The other
largest commercial soap providers remaining market shares.

Alternative hand washing compliance systems

Life boy Hand Wash, a product produced by Unilever, is a complete hand washing
compliance system that is installed (and leased) in businesses like restaurants, hotels,
hospitals and receive. The system includes a small control box that controls water
temperature, pressure and run time. By systematically controlling these factors,
employees can be both trained and monitored in their hand washing frequency and
technique. Periodic reports stored on the computer and linked to the Internet can be
produced to indicate the number of times per month employees have been washing their
hands, and the estimated savings that the system has created through efficient water use.

This system has limited value to business managers because they are expensive to install
and lease, and do not necessarily increase employee compliance. They provide managers
the ability to track usage, but do not help control day-to-day hand washing compliance
individually or immediately.

7.3 Target Market Segment Strategy

Our initial day care market will consist of medium to large day care organizations,
consisting of twenty or more children. Organizations such as Kindercare are very
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attractive opportunities for our products. Organizations of this type are attractive because
they are well managed, successful, health conscious and nationwide. Within these
organizations we will target decision level managers with the power to implement use of
our product in those locations.

7.3.1 Market Needs

According to a study published in the medical journal, Infectious Diseases in Children,
researchers in hand washing recovered fecal coliforms from the hands of one out of every
five staff members, citing that more than 33% of day care facilities "had poor hand
washing techniques and no policy for hand washing before eating or after playing outside.
In spite of all the studies about the benefits of hand washing, improper or infrequent hand
washing continues to be a major factor in the spread of disease in day-cares."

Hand washing in child care facilities is an ideal initial target market for several additional
reasons:

 Child care facilities have rampant illness and germ problems that can be directly
reduced through frequent child and worker hand washing.
 Child care facilities have strict, government mandated rules that require frequent
hand washing.
 Parents are particularly interested in reducing child illness, making them one of
our strongest advocates for the use of CHILD Castel in environments they cannot
directly monitor.

In a study cited by Family Practice News in 1996, "Scientists had kids wash their hands
when they arrived at school, before lunch then again after lunch time, recess and one
more time before heading home every single day."  As a result of these ‘scheduled' wash
times, researchers found that "a month later, these kids had 24 percent fewer days off
from colds, sniffles and flus and a whopping 51 percent fewer sick days because of
gastrointestinal complaints like stomach cramps or diarrhea."

With nearly 12 million children in child care facilities across the nation there is a clear
need for CHILD Castel, our first product, that can both encourage and help monitor child

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and employee hand washing to ensure a safe, clean environment for children. Additional
future target markets also have significant need for fading dye products:

 Hospitals:  "In health care, nurses and doctors wash only 30% of the required time
between patient contacts and procedures. Each year, an alarming 400,000+
nosocomial infections occur in the BD. They are estimated to directly cause 3,000
deaths and contribute to another 7,000 deaths each year.
 Restaurants:  "Food borne illness kills over 1,000 people each year. Over 70% of all
outbreaks originate in food service operations and, as many as 40% are the result of
poor food service and cross-contamination.

7.3.2 Market Trends

There has been a recent effort by the Food and Drug Association, the Center for Disease
Control, the National Restaurant Organization, and others to promote education to
increase hand washing compliance in target markets. The focus of these programs is to
educate and encourage preventative control measures for children and workers to
help reduce diseases and lawsuits. This has led to greater awareness in our target markets
about maximizing cleanliness and minimizing preventable illness.

There is an additional trend in both our target markets and industry towards organic based
soaps. Organic products have become increasingly associated with safety and health in a
variety of different markets. Our completely organic soap is complementary to this
growing market trend.

7.3.3 Market Growth

The demand for child day care services will continue to grow. As the labor force
participation of women between the ages of 16 and 44 remains high, parents of preschool
and school-age children are expected to seek more day care arrangements. As parents
continue to work during weekends, evenings, and late nights, the demand will grow
significantly for child day care programs that can provide care during nontraditional
hours. School-age children, who generally require child day care only before and after
school, increasingly are being cared for in child care centers.

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7.4 Marketing Strategy

For our initial target market of day care facilities, the company will implement two
parallel marketing efforts, aimed respectively at day care facility decision makers, and the
parents of young children who use these facilities. We will create a push factor by
effectively convincing the decision-level managers within the organizations that our
product provides an ideal solution to the hand washing compliance. A "first to mind"
branding campaign will build CHILD Castel as the leader in increasing hand washing
compliance. Significant parental support will encourage organizations to implement
CHILD Castel in environments involving their children.

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