Business Plan Revamp 3

8/11/2019 Business Plan Revamp 3

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THE FAMILY FISHFARMS NETWORK,

INC.

Strategic Business Plan 2014

A Sustainable

Business Model


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Ver. 4.3 Confidential

2014 The Family Fish Farms Network Inc.

The Family Fish Farms Network, Inc.

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We grow fresh healthy food,

eliminate pollution,

save millions of gallons of fresh water,

and create decent green jobs.


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Table of Contents

This Document 3 Confidentiality 3

Planning 3

Executive Summary 4

The Company 4

The Technology 4

The Problems We Solve 15

Success Factors 17

Competition 19

Business Development 25 Marketing Communications 25

Sales 25

Aquaponics - Recirculating Aquaculture Systems 26

Management Team 30

Start Up Management 30

Financial Pro Forma 32

Appendices

Appendix # 1RAS-1 Elevation Drawings

Appendix # 2RAS-1 Concept Drawings

Appendix # 3Bon Appetit Letter of Support

The Family Fish Farms Network Inc.,


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This Document

This document is a summary of our business plan prepared specifically and only for

purposes of general evaluation of the Family Fish Farm Network, Inc business concept.

It is neither intended as an offer for investment no is it a solicitation of any kind.

Financial projections are generalized. They are consistent with appropriate ratios for

the like businesses and conform to accepted accounting practices for such pro forma

statements. Development of specific budgets and for revenues and expenditures will be

possible after the completion of a standard feasibility study to be completed prior to

project start. This will enable further operational and market plans with detailed

information to be developed.

Confidentiality

Presumption of Confidentiality: The reader should not that receipt of this document

includes a presumption of confidentiality and that the unauthorized disclosure of the

content to any third party without the express and written authorization of the

Company could cause grievous and irreparable harm to FFFN.

Planning

This is a Business Plan. It is not an operational plan containing specific details and task

level accomplishments. This is a policy and strategic level instrument. However, as part

of the initial feasibility study and a fully loaded and task level plan will be developed. Itwill include project milestones, detailed tasks, and resources including both people and

costs (budgets). It is reasonable to assume that pro forma financial projections

contained herein are a food faith effort, are approximate, and represent our best

informed professional opinion.

Professional Resources

Legal Counsel:Foley & Lardner, LLCTracy A. Bacigalupo, Partner

3000 K Street N.W.Suite 600 Washington.D.C. 202.672.5300 F 202.672.5399Investment Banking:Equity Expansion International, IncNorman Kurland, Esq Senior PartnerP.O.Box 40711Washington, DC. 20016(Tel) 703-243-5155 (Fax) 703-243-593


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Executive Summary

The CompanyThe Family Fish Farm Network (FFFN) will become the first aquaponics company to

bring commercially competitive local farming and fish production to cities around the

county and around the world. We intend to build 400 urban aquaponic farms in the

inner cities across the country. The companys proprietary technology will reduce cost

and boost profits while also eliminating the need for fertilizer, reducing the need for

water, using vertical farming, and making agriculture no longer dependent on the

extremes of the weather. It is our intention to raise $5.4 million to achieve our business

objectives. Our specific strategies, methods, and means are the subject of this business

plan.

The Need

There is a significant demand for locally grown, nutrition dense food. A recent study by

Karp Associates found an over $3 million pent up demand for local food in one

Midwestern city alone. In addition, millions of Americans are without access to fresh

food, living in food deserts in the inner cities.

The Technology

Aquaponics is a re-circulating growing system. In our model fish and vegetables are

grown in adjacent tanks. The filtered effluent of the fish provides the basic nutrientsnecessary for the plants, therefore eliminating nitrate fertilizer from the environment.

The plants extract nutrients and filter the fish effluent, which is then bio filtered and

returned as clean water to the fish. The plants extract nutrients and filter the fish

effluent, which is then bio filtered and returned as clean water to the fish. FFFN has

developed proprietary technology and processes are widely applicable and will be

employed to grow seafood, vegetables, and mushrooms. The company has developed a

unique growing system that can produce year-round, high profit speciality crops. The

seafood, vegetables, mushrooms and other produce are free from all antibiotics, growth

hormones and animal protein based fish feed. Our process is environmentally friendly.

Business Model

Our company will achieve local, regional, and finally national distribution through

progressive deployment of a hub and spoke system. In our model all production will be

local food. We will build hubs in the populations centres and expand our spokes on

the outskirts (10-15 miles) from the hub. Each hub will support between 3 -5 spokes

depending upon individual market demographics and consumer demand. This

approach provides for maximum flexibility to market demand, food security, and also

provides for redundancy in the production system in case of crop failure, or other

unforeseen events.


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Create an aggressive corporate branding program

Grow in the cities and surrounding areas where the demand exists

Produce and sell on a 12 month basis

Employ a distributive production model ensuring flexible response to consumer

demand

Introduce efficient production automation to reduce costs and assure quality

Invest heavily in training a high performance workforce

Current Status

We have a commitment for a $400,000 investment along with co-location of our first

production facility, through a collaborative marketing partnership with Profish, Inc., a

$50 million dollar regional distributor of seafood in the mid-Atlantic region. Virtually

all of their customers are likely prospects for our fish and vegetables. This assures

initial market penetration, sales and distribution.

We provide Profish with a production capacity enabling them to control the timing and

guarantee delivery during the off seasons for time sensitive micro greens, herbs, and

other highly prized herbs and vegetables further solidifying their relationship with their

existing customer base. As an internal customer, Profish provides FFFN with a built-inmarket with sales and a local distribution network, assuring uptake of our production

capacity from the very first day of operations. We also have a commitment from Bon

Appetit Management, Inc., a national sustainable food company that provides food to

companies, colleges and universities to buy any of our products. The food we produce

has a virtually guaranteed market.


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Competitive Advantages

Fresh Local Food Our ability to deliver fresh (not frozen, not days, buts hours from

market) fresh local food on a 12 month basis with price stability and predictable

availability is a major market advantage. Coupled with our partners existing and

extensive sales and distribution network, we can sell virtually everything we grow,

adjacent to our proposed first site.

Vertical Growing We grow in urban environments utilizing surplus industrial

buildings. To control ambient lighting and maximize growth potential a vertical

growing model with movable racks and LED lighting optimizes production. We can

grow four or five times the production of a similar sized greenhouse.

Proprietary Technology- We have confirmation of the unique process strategies wehave developed. Bellis & Katz, patent attorneys, have reviewed our concept and found a

strong likelihood that patentable technology exits.

Distributive Production- As we plan to expand locally, regionally, and nationally using

our hub and spoke method, all food production will be local. All production will be local

as will all deliveries. The redundancy built into the system assures a wide range of

product delivered at the most cost effective price point and the freshest possible

nutritional content.


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Branding Program

Essential to the success of a distributive system is universal highquality and effective management of the corporate brand. This includes all aspects of

the companys public face our image, the conduct of our business with our customers

and vendors and suppliers, and in all media, as we envision our environmental and

social policies as assets of the corporation and to proceed so as to identify our company

with those attributes. These are the elements that support ever-growing customer

identification with, and demand for, the Family Fish Farm product.

Sales and Distribution- Our ProFish partner brings extensive sales and distribution

capability including a proprietary CRM and customer engagement process that hasenabled them to dominate the market in the Mid-Atlantic region.

Strategic Path

The first phase will be the construction of a demonstration unit. Upon full funding, this

is followed as soon as possible with a full-scale operation together with training

facilities and development capacity in the DC area. This will be followed by the

construction of a network of units near urban centers in the USA. In the first 5 years the

network will be expanded to 38 units, and it is on this basis that the financial

projections are presented. Over a period of 10 years it is planned to expand to a

network of 400 units.


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Sustainability Model

Operating Philosophy

Corporate Social Responsibility (CSR) has become an increasingly relevant issue for the

consumer and for the view of an organization as a good corporate citizen. FFFN has

universally adopted the Triple Bottom Line, (People, Planet, & Profit) as official

company policy and intends to apply this philosophical approach to the internal and

external policies and process.

As a manifest demonstration of this ethos, we accept the tenet that good social and

environmental practice is good business. In that regard we will employ a number of

innovative social and commercial strategies. Principal among them will be the structure

of the corporation including


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The Environment

FFFN provides a broad range of green methodologies that will have significant positive

impact. Our technology totally eliminates farm-based pollution as fertilizer, which is amajor source of stream, lake, and even ocean contamination. We save water through

the elimination of millions of gallons of fresh water usage. We do this by bio-digesting

and filtering all water used. Finally by growing locally, we slash the carbon footprint,

since the food does not need to be transported across the country.

Social Impact

Our development and deployment models targets urban population. FFFN will train

neighbourhood residents to run, operate and own the individual growing units and to

provide market access through our sales/marketing organization. In addition FFFN willfundamentally alter the traditional adversarial relationship between labour and

management aligning the interests of both through equal equity ownership opportunity

in our company.

Competitive Advantages

The company believes its environmentally sound and socially responsible processes,

combined with its production efficiencies provide a strong basis for a business model

that has a sustainable competitive advantage.

The triple bottom line is reflected in our companys advanced incentive methods

specifically; the application of enlightened self-interest as a means to achieve true

worker empowerment.

A symbolic Partnership

Profish, Inc., the largest seafood distributor in the Mid Atlantic regions with key

commercial accounts up and down the Atlantic coast, as a well-established supplier of

premium quality seafood to the areas most famous restaurants. The ProFish

Partnership virtually assures immediate access to key accounts and a ready market forboth our Tilapia and Micro greens, Boston Lettuce, and other vegetables.

The partnership is synergistic in that it provides FFFN with built in market access and

affords ProFish a new role as it dis-intermediates the value chain, making ProFish a

producer as well as a distributor. Furthermore, the partnership affords a unique profit

opportunity for both organizations.


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FFFN ProFish Partnership Can ProduceUncommon Profitability Through Achievement

of These Four Strategic Pillars of Our Company.

4. Focus on producing locally sisired short shelf-life products thatcommand high margins.

3. Provide quality produce at a competitive price point.

2. Grow large volumes of first quality produce on a dependableproduction schedule.

1. Deliver our product on a 12 month basis exclusive of weather,

growing cycle or seasonal issues.


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Corporate Business Plan

The Company

The Family Fish Farms Network (FFFN) is a Delaware Corporation, with offices located

in the District of Columbia, at 717 Lawrence Street, NE 20017.

FFFN has created an urban farming model employing a proven technology called

Recirculating Aquaponics Systems (RAS). This process employs the well-known

fertilizing and propagation properties of fish to grow high quality garden vegetables.

The system produces high quality fish, free from fertilizer or chemicals, as well as

contaminant-free produce in a year round growing environment. Our process is unique

and proprietary. We have a letter from an accredited patent attorney stating theviability of the technology and it potential as a process patent.

Additionally, the company has produced a proprietary growing system for garden

vegetables and micro-greens which makes them available year-round and gross

margins are compelling.


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The BusinessThree Phase Roll Out FFFNs first facility will be our production prototype.

Phase Ones main objective isto build and operate a single proven profitable business as

proof of concept. This will be our first and most important installation. Completion and

profitable operation will initiate Phase Two of our strategic plan.

In Phase Two we will use this as a demonstration site, to optimize production, establish

best practices, and document and institutionalize those practices. The key to multiple

successful units is effective process, procedures and training of both mangers and staff.

Phase Threewill be to replicate and deploy our proven system business model. Simplyput, FFFN is a food producer, a food wholesaler, and a retailing operation that markets a

unique and highly desirable product to a committed high end market.

PhaseThree

PhaseTwo

PhaseOne

Construction and

profitable operation of

the national

headquarters and

training centre

Construction and

Operation of two RAS-1Micro Aquaponic Farms

Roll Out Development of

Mid-West Deployment

Program


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Our Plans call for the creation of a prototype urban farm production unit. Once

optimized, FFFN will engage in a planned roll out process. We will build a series ofdistributive, small- scale urban farms in local communities and neighbourhoods in

major population centres. The corporate entity will be responsible for product

branding.

FFFN will grow, market, and sell a product line consisting of fresh locally grown fish and

produce. Our business model calls for a network of urban farms. The individual farms

are to be locally operated, and for the employees and operators to share in the success

of the national brand as well as being incentivized by their own production. Theseurban farms will be linked in a commercial network and marketed under a single brand.


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Business Model

Family Fish FarmsNetwork

Organisation

Resources

Operations

Finance

Admin

R & D Marketing

Production

Performance

Standards

Systems

M & E

C

U

S

T

O

M

E

R

S

Regional Centres (HUBS)

Marketing

Information

Local Micro Farms (Spokes)

Feedback

Sales

Revenue

Major

Caterers

Restaurants

Institutions

Farmers Mkts.

Consumers

Revenue

(Licensing Fees)

Revenue

(Licensing Fees)


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The Problems We Solve

FFFN will become a preeminent example of green sustainable technology. We solve amultiplicity of pressing consumer, economic, social and environmental problems. FFFN

conforms to the principle of the Triple Bottom Line: Financially Viable, Environmentally

Sound, and Socially Responsible.

Availability of Healthy Food FFFN grows food that is sold and consumed

locally. FFFNs locally grown food is fresh from the garden to the table in hours ifnot minutes. According to a recent piece on MSNBCs Green Planet New

Program, some 45 Million Americans do not have access to fresh healthy food.

Farm Based Pollution FFFN totally eliminates commercial fertilizer from its

operations, thus saving the environment from having to mediate tons of nitrates

that would commonly be used to grow the produce. Our streams, ponds, lakes

and shoreline are being polluted and damaged by fertilizer run off from

commercial farming operations.

Consumption of Clean Water 70% of all fresh water is consumed by

agriculture. Population growth will require 100% expansion of present water

volume to produce food sufficient to feed that growth. FFFN extensively filters,

bio digests, and reuses all water. Once our tanks are filled the water is fully

exchanged every three hours. Water loss is less than 5%. Commercial farming

uses millions of gallons of water that must be remediated by the environment.

The FFFN process saves millions of gallons of water.

We Grow Fish andVegetables

We Eliminate FarmBased Pollution

We Save MassiveAmounts of Clean

Water

We Reduce TheCarbon Footprint

We PromoteCommunityEconomic

Development


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Reduction of the Carbon Footprint FFFN grows the food where it is

consumed, thus eliminating the huge carbon footprint of most fish and produce

that is shipped across country and fro Central America.

Reduction of Landfills and Waste FFFNs crops of mushrooms can be grown

on discarded coffee grounds, among other materials. Discarded grounds from

just one coffee store can exceed hundreds of pounds a week.

The Creation of New Green Jobs When fully evolved, our business model calls

for the creation of over 200 new green jobs serving our local market. This

method can become a model for urban centres in all major cities. Over half of the

US population lives in cities and all are experiencing economic privation and

budget problems. Ours is truly a sustainable solution to urban community

economic development.


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Success Factors ~ 17 ~

Locally Available

Pre-Purchase Agreements

Brand and Customer Loyalty

Competitive Pricing

Local Availability

At present there are few local sources in the Metropolitan DC area for locally sourced

high quality fresh fish and garden vegetables available on a 12-month basis. Freshness

is a buying issue for both wholesale and retail consumers. Since our production is

dependable on an annual basis we can provide purchase agreements and grow on

contract, guaranteeing price, where others cannot. We believe we can get our product

from production to the market faster than anyone. Given that, our price point is wellwithin the range of wholesale cost for comparable product, proximity becomes a buying

factor. Being a local producer is a definite plus.

Green Product

FFFN provides both societal and environmental benefits that we plan to market

aggressively as part of product branding. The LOHAS (Lifestyles of Health and

Sustainability) market demographic is socially conscious and will find our offering

attractive. Our Branding strategy will take full advantage of our environmental and

social features. We will proactively engage our customers in a dialog, building brand

and customer loyalty.


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Potential Pre-Purchase Agreements

We have had substantive discussions about selling potential seafood, vegetable and

mushroom products with regional management of Bon Appetit, the US largest

(approximately $12 billion in annual revenues) provider of food services for top-end

institutions such as Universities and Corporate Campuses.

http://bamco.com/sustainable-food-service/fish-to-fork

Bon Appetit has approximately 400 locations in the US and their commitment to buy

local and fresh makes them an ideal strategic customer (see appendix 4 for letter of

alliance partnership)

Competitive Pricing

Our value proposition fits well with Adam Smiths proposition that if a product has

superior features and benefits and it sells for the same price, then it will be successful.

That is our market position. In addition, the FFN product is unique in that provides

highly attractive benefits to the buyer and it is a local food product as well.

A Disruptive Model

The term Disruptive Food Technology, sounds like it was written to describe The

Family Fish Farms Network. We are the very embodiment of a disruptive technology.

We have the potential to fundamentally change the existing markets and, by extension,

the entire food value chain. Our approach (both strategic and technological) will de

facto improve the quality and availability of food.

Additionally, by building a network of distributive aquaponic urban farms located in the

inner cities where the population exists, we bring high quality, nutritious food freshfrom the harvest to local markets. The difference in both nutritional content and taste

between food that is days old and food that is hours from harvest is incomparable.

Furthermore, by disintermediation (removal of the distribution step) from the value

chain we virtually eliminate the carbon cost of transport.
http://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-forkhttp://bamco.com/sustainable-food-service/fish-to-fork


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Competition

In reinforcement of our business model, our company fundamentally changes the waygarden vegetables are produced and distributed. We are a disruptive food technology.

Our production methods using fish as live permaculture fertilizer substitute is a game

changer for fish and vegetable production. Our distributive production model for

providing local food on a national scale is fundamentally different from any model

presently available. FFFN competes with 4 types of entities:

Mainstream agribusiness and seafood producers and distributors;

Large organic food producers;

Seasonal Local food options such as farmers markets, and Community

Supported Agriculture (CSA); and

Urban farming from hydroponics and aquaponics producers.

1. The mainstream competitors have products at accustomed price points, but fall

short on quality and evolving standards of environmentally acceptable and

sustainable business models;

2. The large organic food producers have the same distribution challenges and

seasonality shortfalls as the mainstream producers;

3. The local food options have not yet met traditional producers grow margins and

year-round availability; and

4. Although approved and supported by the mayor, the 100,000 sq. ft. Hydroponics

(only) site has yet to be built.

Given the enormous need for fresh local food there is ample market for several

more such competitors in this marketplace.

FFFN Innovations

Deliver product on a 12 month basis exclusive of weather, growing cycle or seasonal

issues;

Proprietary processes and technology consistently grow large volumes of first quality

produce on a dependable production schedule acceptable to both small and large

commercial customers at a competitive price point.

Distributive production model permits wide spread delivery of freshly grown local

vegetables and seafood.

Focus on short shelf life products that are both desirable and in limited supply to

enable higher profit margins.


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Marketing

The Market

Walmartsrecent environmental initiative has a strong basis in social trends. Although

organic foods presently account for only 3% of U.S. food sales, consumer demand for

organically produced foods, has shown double-digit growth for over a decade and acompound annual growth rate (CAGR) of 17.9% for the period spanning 2004-2008. (i)

Organic foods are now available in over 20,000 natural food stores nation-wide and 3

out of 4 supermarkets. According to the Nutrition Business Journal, U.S. sales of organic

foods were $21.1 billion in 2008 and are on track to reach $23 billion. (ii)

Fresh fruits and vegetables are the top selling organics and presently account for 37%

of U.S. organic sales.

The appeal of organic foods continues to broaden as recent survey by Hartman Group

and Food marketing Institute found that 2/3 of Americans surveyed had specifically

selected an organically grown food in the prior year. (iii) Looking forward, theanticipated organic foods CAGR for the five-year period from 2008-2013 is expected to

slow slightly to 10.7% raising the organic food market to $38.2 billion by the end of

2013.

Comparatively, the Asia-Pacific and European markets are anticipated to grow with

CAGRs of 11.4% and 9.5% respectively over the same period. The U.S. presently

consumes 44.2% of the worlds organic food supply; with Europe consuming 47% (Non-

domestic sales are relevant only in the sense that supply chains could be diverted by

changing global consumption patterns). Still trends toward organic food purchases can

be a strong positive factor through 2013/2014.

Distributivestructure

enables rapiddeployment

QualityProductaccesses highend markets

High Profit

Lower Volume

ControlledExpansion todown market(wholesale)Outlets

High Volume

Lower Profit

Brandingpermitsconsolidationof all fish andvegetableproductionunder a singlequality brand


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Beyond healthy eating habits, the organic food market is further affected by its implicit

association with Green trends. A stated objective and requirement of the USDA

Organic Program is the conservation of resources. New reports regarding Greenhousegases and cap and trade programs serve to consistently reinforce growing interest in

organic farming. Again, the green social trend is a positive factor.

Market Definition

The initial customer for FFFN is a local or regional retailer who caters to the

environmentally-aware or health-conscious individual who is purposefully selecting

locally-grown organic or naturally produced foods for the foods purity and

environmentally sustainability.

A number of public and private studies have been done to identify the demographics

and buying habits of the individual who chooses organically-grown foods. The appeal of

the organic foods is widespread with few traditional demographic lines identified.

Weak correlations exist indicating increased purchasing by higher disposable income,

greater education and female gender. The USDA has elected to simply characterize the

organic food consumer as individuals that prefer organically produced food because of

their concerns regarding health, the environment, and animal welfare, and are willing to

pay the price premiums established in the marketplace.

Market Positioning

The growing demand for fresh unadulterated food can be seen in the popular media and

even in the large supermarkets, and finally, even the big box, stores are emphasizing

health and food content and environmental impact. The terms organic and natural

have become clichs and are now the subject of federal food and drug regulations.

Aholds Natures Promise, brand is a classic example. Whole Foods is no a category-

dominant food retailer, where it was one a speciality store only.

The Environment continues to be a major concern to the broad Americanpublic and companies are attempting to respond. Even big oil now purports to

be going green with bio fuels and other such renewable energy efforts. The

spectre of global warming looms large in the publics imagination and a reduced

carbon footprint is the subject of many claims of environmental responsibility.

FFFN is the epitome of a green, socially responsible business. In fact, we see our

corporate profile as a major business asset and one that we plan to aggressively

exploit. Social Responsibility is paramount in that we intend to locate in the

inner city where jobs are so critical to economic development. We will trumpet

these attributes in our promotion efforts, in our community outreach, even in

our packaging.


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Pull Driven Value Chain

The growing market demand for quality, fresh, local food combined with the high cost of

transportation faced by traditional farming methods makes our products highly

competitive in the marketplace. Our production technology and resulting operatingefficiencies allow us to make and maintain healthy profit margins in the face of global

food imports, US agribusiness, and our urban farming competition. As a local producer

organization we also eliminate the jobber, or wholesale distributor, from the value

chain. Although our initial customers will be high-end retailers and restaurants, we are

price competitive with imported products. Our fish and vegetables are actually fresh

and sold within hours of harvesting. We can compete on price, but imported fish and

centralized large-scale food producers will never be able to compete with us on

freshness and quality. We see our value chain as being, pull driven. Our problems will

not be centered around achieving marketing and sales goals, but on meeting customerdemand.

The Product

Our first production unit will produce three principle products. Tilapia is a mild, firm

fleshed white fish that has captured a significant place in Americas food market. We

import 45 million pounds from Ecuador alone each year. Tilapia is also a hardy fish and

the technology for growing it is well known. Our initial vegetable production choice is

Boston Lettuce, as it is quite popular, hardy and will produce the best yield. Our Initial

mushroom offering is oyster mushrooms, a highly desirable premium variety.

Over time we will expand our product offerings to all Commercial and Retail Customers

(unless otherwise noted,) including:

Fish

Cooked Tilapia for Carryout Service;

Catfish;

Rockfish (Striped Bass);

Additional Fish species, produced by others; Oysters, produced by others.

Vegetables

Herbs;

Micro-Greens;

Tomatoes;

Cucumbers;

Summer Squash


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Price Point Positioning

A pound of Tilapia sells for $6.99 a pound in mainstream supermarkets (at the time ofwriting). The standard mark-up is 30%. Our estimated cost of production is

approximately $2.25 per pound. The planned selling price is $3.00-$4.20lb. As a local

producer we do not have significant transport cost. In fact many of our customers will

actually prefer to pick up product improving their flexibility in response to demand.

A pound of lettuce sells for $12.00 a pound. Incidentally, the average head of lettuce

travels 1,500 miles from farm to table. We have virtually eliminated the cost of

transport and wholesale mark up. Our cost to produce is $1.80. The average wholesale

cost is $8.40 per pound. This provides us with significant flexibility in both price and

margin.

MIGS allows us to sell Oyster Mushrooms and other short shelf life and environmentally

sensitive products at high product margins.

Tilapia Market Pricing

6.99lb

4.90lb

2.25lb

Average Retail Cost

Estimated Wholesale Cost

Cost of Goods (COG)

Boston Lettuce Market Pricing

12.00lb

8.40lb

1.80lb

Average Retail Cost

Estimated Wholesale Cost

Cost of Goods (COG)


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Target CustomerAs previously mentioned, our initial customers will be mainly high-end food stores; we

will focus initial sales on relatively low volume, high quality conscious customers. We

also see select restaurants as initial customers. Our market strategy is to sell to low

volume high quality customers first and then to move down-market as our production

capacity increases.

It will be advantageous to maintain a retail facility for sales to the community where we

are located. We plan to hire and train local staff and to establish a community outreach

effort to promote healthy eating and nutritional awareness. Expansion of our customerprofile after initial success could be to sell raw and cooked products to caterers, provide

a retail presence that would sell fillets to take-home customers, and prepared meals for

consumption onsite. This would not present significant additional costs to introduce

once the initial startup reaches break even.

Product MixAs FFFN produces both protein and produce, our plans call for the initial facility to grow the

most accepted and profitable products as our initial offering. As previously mentioned, our

protein fish will be Tilapia, as it is a firm fleshed, mild tasting fish that has attained significantacceptance by consumers. The technology required to grow it is also well known. The initial

vegetable selection will be Boston lettuce. This has broad market acceptance. There is a wide

demand and it is a premium lettuce that also grows well in a hydroponic environment.

Promotion

FFFN plans an aggressive public relations and community outreach campaign to

introduce the company and its products. The program will emphasize our key assets of

quality, environmental friendliness and social responsibility. Given our unique business

model and value proposition we believe that public relations will be one of our major

promotional venues. Our story is an interesting and powerful one and we intend to

capitalize upon it.

Our motto will appear in all publications, on our website, and even on our packaging:

Company Motto:

FFFN, we grow healthy food, eliminate pollution, save millions of

gallons of fresh water, and create decent green jobs.


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Business Development

FFFN plans a class of relationships we call The Fresh Food Community Alliance.

The Alliance will create a community of interest between FFFN and our

client/customers. The purpose of the alliance will be to promote healthy eating and the

availability of healthy fresh food in the neighbourhoods and communities of Louisville.

The program will sponsor public events and support appropriate community and

neighbourhood events. Members will be entitled to affix the logo to their promotional

materials, menus, and flyers. FFFN plans a phased business development plan that will

see FFFN installations spread throughout the Mid-Atlantic states, and then to wider

markets. Our growth plan calls for creating first local, then regional, and eventually

national brand identification. We will use the distributive local food model to gradually

extend and deploy our methodology for both community development and nationalmarket dominance.

Marketing Communications

FFFN will employ a promotional mix that will effectively use all popular media including

the Internet. Our website will be both promotional and educational. We will also use

local radio and community television, along with visits to local community institutions.

We see ourselves as a local business in every community we serve.

Sales

As ProFish is our sales and distribution partner, we have ample sales resources in-

place. This includes a 23 truck daily distribution network extending from NC to DE. We

also have a letter of support from Bon Appetit, (See Appendix #3) the largest ford

services company in America. We will also hire a sales manager experienced in and

knowledgeable about our target markets of high-end food stores and local restaurants.

We will professionally produce a short two-minute video commercial that will

introduce the production venue and emphasize the quality and freshness of our

products. FFFN will have a colourful and attention grabbing vehicle. We will provide in

store-tasters, community outreach, and school educational programs. This will be a

small compact van that will be wrapped in a bright colourful graphic treatment to

further reinforce our presence in the communities.


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Lead Generation

Generating sales leads will not be difficult since we are partnering with an existing

dominant mid Atlantic distribution company. ProFish has familiarity with food retailers

and restaurant owners in the area. We know them from various civic and other

meetings and as patrons of their establishments. They are existing customers. Still, we

will prepare both electronic (internet) and regular direct mail solicitations. These will

be followed up with personal appointments and calls from our principals.

Sales Promotion

In order to induce our new customers to sign long-term purchase agreements, we will

offer both service and sales promotions to that end. The specifics of these promotions

will be determined in cooperation and input from our alliance partners.


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The Technology

Aquaponics Recirculating Aquaculture Systems

FFFN will employ a proven aquaculture and hydroponics technique called Recirculating

Aquaponics to grow high quality protein (seafood) and fresh natural produce.

Vegetables are certified organic and fish are free from all antibiotics, growth hormones,

or animal protein based fish feed. The process is environmentally friendly.


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Aquaponics uses the filtered and bio digested effluent of the fish as fertilizer for a

hydroponics section. As previously noted, our process fully eliminates farm source

pollution. Aquaponics is a well-known and proven technology. There are a number of

successful large-scale US operations already in-place. Many of these organizations focus

on export.

Food and Water Watch is an internationally known, well-respected, advocacy group thatpolices the quality and availability of clean water and fresh unadulterated food. FFFN is

Sustainable Aquaculture, (a member of the Aquaponics Systems Assoc., ASA)

http://www.foodandwaterwatch.org/fish/asa/.

We have access to the best knowledge base and technology presently available. A

functional model of our system (shown above) explains how the technical process

works.
http://www.foodandwaterwatch.org/fish/asa/http://www.foodandwaterwatch.org/fish/asa/http://www.foodandwaterwatch.org/fish/asa/


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RAS-1(Recirculating Aquaponics System) Our Base Production Unit FFFN has designed this

production unit as our initial production facility. (See appendix #1 for full drawings).The unit is constructed from recycled seaborne shipping containers and aircraft quality

structural steel tubing. In addition to this stand-alone structure RAS-1 is designed to fit

into an existing facility and can be easily retro-fitted for that purpose.

Note: The base is constructed from recycled and reengineered seaborne shipping

containers. These are inexpensive, heavily made, and will withstand years of extremely

hard use

Example Elevation Drawing RAS-1 System (See appendix #2 for full drawings.)

This is an elevation drawing and part of a full set of Architectural renderings. Full interior and

exterior design drawings are available.


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MIGS An advanced Growing System

High Value/Profit Crops, A 12 Month Growing Cycle, Low Entry Cost with Available

Financing

Note: Although MIGS is not planned as part of our initial proof of concept model, the

existing system can readily be expanded and converted by the addition of several of the

units described herein. This is included as indicative of our thought leadership,

innovation, and expansion potential.

What is MIGS?

MIGS is an 8 x 8 x 8 advanced container sized growing system. MIGS employs proven

automated vertical growing technology, to grow high value crops like oyster

mushrooms and micro greens. These crops can be profitably grown for local food

markets.

MIGS Feature

MIGS comes fully equipped and instrumented. It is a plug and play. technology. Hook

up the power, water, plant the crop and you are in business.

MIGS exploits the latest in NASA inspired growing technology including remote

monitoring * automated * planting and harvesting * LED lighting * 24/7 Wi-Fi online

link to Tech Support * geo-thermal heating and cooling * energy tax credits and

subsidies * full training and available installation. Finally financing is available throughexisting Agriculture State and Federal Programs, as well as, private in-house leasing

arrangements.

Energy Efficient Food Security Option

MIGS is designed to be physically secure, with a high survivability profile. One option is

to partially bury the unit in a 4 ft. trench using the excavated soil to form a berm

providing high insulation and physical security simultaneously. It is also economically

feasible to concurrently dig an adjacent trench for a geo thermal heating system that

will draw from the earths constant temperature to reduce both heating and cooling

costs. This will also trigger energy tax credits and both state and federal subsidies.


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Management

Our existing team will run the company during the formative stages of development. It

is important to note that a start-up requires agility, iterative prototyping, as the

definitive business model is defined. As we establish process and procedures, ITfeedback and command and control networks, we will hire the professional

management team necessary to guide our deployment to a regional then national and

global enterprise.

The Companys start up team consists of senior management experienced in finance,

aquaponics, commercial product management and sales, project management,

organizational design, and plant start-ups.

President Jerome Peloquin, a serial entrepreneur visionary, who has driven theconcept. Expert in both process management and plant start-up. He participated

in plant starts for Honda America Mfg., Frito-Lay., and Duracell. He also served

as Manager of Technical Training for Honda America Mfg. Mr. Peloquin is an

organizational psychologist with 30 years of organizational management

experience at all levels of management and supervision.

Vice President and Chief Financial Officer A CPA former financial officer for

both domestic and international organizations has experience in both accounting

and financial management, treasury management and operations.

Vice President, Sales, he has organized and trained sales and marketing staff in

B2B an operational manager, experienced in business operations, management,

sales, finance, and information technology an entrepreneurial self-starter

capable in any organizational environment, with ability to handle heavy

workloads and multiple responsibilities.

Chief Growing Officer A third generation grower who has worked at all levels of

hydroponics and aquaponic systems. He is a pioneer and specialist in verticalgrowing and LED based lighting systems. Grahame has designed and developed

growing systems globally and is a plant design and management operations

expert.

Aquaponics System & Controls Manager, Operation Manager, Biologist &

Engineer recently a designer, builder, and manager of multiple growing facilities,

she is also a control systems engineer and will handle daily operation and will

soon have her MBA in Sustainable Management.


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Aquaculture Systems Hired by Hormel Foods Farm Fresh Catfish Company, to

manage 13 farm locations comprised of 6,000 acres. At Farm Fresh, he

supervised a 64 person management team in the Mississippi Delta, where heplanned, organized, directed and controlled all divisional activities necessary to

achieve the established goals of fish production, profit, performance and growth

resulting in 15 million pounds of annual production, while trimming 0.5 million

from the annual operational cost.

Information Systems, A former senior manager at IBM, expert in systems

programming, cloud based computing, and large scale development. He is a

former programmer, sales and technical support manager. His is also a

nationally recognised authority on the iSeries IMB midrange machine we intendas the backbone of our agile systems.


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Financial Pro Forma

The following financial information is predicated upon the assumptions that underlie and

support the financial data. The company seeks to raise $5.4 Million (USD) and will require

additional funds as deployment of the national network begins in the third year. The

projections presented here and in the detail that follows are based only upon the original $5

Million investment.

This table is a representation of key financial data extracted from the Pro Forma and

presented here to provide a quick summary of key financial information.

We fully expect to begin a nation expansion program in Year 3, based upon success in the

DC market. The following table presents timing of additional investment, and projections of

revenue and profits that will be realized.


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The Expansion Table, below presents our planned roll out for the first five years of

operations. It is possible that a more aggressive expansion may be possible but we have

chosen the more conservative path. Our challenge will be to optimize production, create

best practices, and document all processes and procedures before beginning to expand. As

you will note we have given ourselves two years to accomplish that task. Experience from

more complex start-ups indicate that 18 mos. may be possible.


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Appendices

Appendix #1 .RAS-1 Elevation Drawings

Appendix #2 .....RAS -1 Concept Drawings

Appendix #3 Statement of Support (Bon Appetit)


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Appendix #1 ~ 40 ~

FFFN Elevation Drawings

This is a spoke system, a local micro farm.

Note: The base is constructed from used shipping containers.


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Appendix #2 ~ 41 ~

FFFN Concept Drawing

Typical (Distributive Spoke) Growing Unit

15K sq. ft

Typical Hub Administrative, Training and Growing Unit


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FFFN, Inc., div MicroVenture Support Inc.

717 Lawrence Street, NE Washington, DC 20017

Phone: (202) 652-0185 Cell: (410) 227-0498

www.microventuressupport.org

i "ERS/USDA Briefing Room - Organic Agriculture: Organic Market Overview."

USDA Economic Research Service -Home Page. USDA Economic Research Service. Web. 08 Oct. 2009.

.

ii

Ibid

iii Greene, Catherine, and Carolyn Dimitri. "RecentGrowth Patterns in the U.S. Organic

FFoods Market."Http://www.ers.usda.gov/publications/aib777/aib777.pdf .

USDA Economic Research Service, Sept. 2002. Web.
http://www.microventuressupport.org/http://www.microventuressupport.org/http://www.ers.usda.gov/briefing/organic/demand.htmhttp://www.ers.usda.gov/publications/aib777/aib777.pdfhttp://www.ers.usda.gov/publications/aib777/aib777.pdfhttp://www.ers.usda.gov/publications/aib777/aib777.pdfhttp://www.ers.usda.gov/publications/aib777/aib777.pdfhttp://www.ers.usda.gov/briefing/organic/demand.htmhttp://www.microventuressupport.org/

Business Plan Revamp 3

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