Tom O’Connor Julia Walker Lauren Dusak Kristina Gentilozzi Kaitlin McQuade Frank Marallo Derek Szu-Tu

Lauren Faga Brandon Miniman Sean Helmig Carolyn McCarthy Chuck Sgammato Mike Pattavina Angela Russo

Max1m

Innovations

Our ProductOur Product

• Vitamin B12 based gum

• 10 sticks per pack

• Healthy alternative to caffeine

• Functional gumMaxim Innovations

Benefits of Vitamin Benefits of Vitamin B12B12

• Improves memory

• Enhances learning capabilities

• Increases blood flow

• Promotes healthy metabolism

• Long term energy

No Negative Side Effects Maxim

Innovations

Why Put B12 in a Chewing Why Put B12 in a Chewing Gum?Gum?

• Best absorbed through tongue

• Convenient

• Good stress reliever

• Increases focus

• Easy to use

Maxim Innovations

Sales Potential

5

6

7

8

Years 2006 2007 2008 2009 2010 2011 2012

Dol

lars

(In

Bill

ions

)

Vitamin MarketVitamin Market• $5.431 Billion Dollars (2006)

• 5% growth each year

• US is now health conscious

• Creating a new niche

Maxim Innovations

Target Market & Market & Market ShareMarket Share

Year People Market Share

1 1,884,800 1.6%

2 3,769,600 3.2%

3 4,523,520 3.8%

4 5,202,048 4.4%

5 5,729,729 4.9%

• Market Size• 117.8 million adults use vitamins• 37.7 million within our age target

• Customer Profile• 18-34 years old• Active, health conscious• Busy lifestyle

• Survey Results • 82.5% willing to buy

Maxim Innovations

DistributionDistributionNationwide:

• Region has little effect

• Optimize sales potential

Distribution:• VMS Stores

• Specialty Food Stores

• Gyms

• CVS

Maxim Innovations

PromotionPromotion• Magazine Advertisements

• Counter Advertisements

• Online Advertisements

• Promotions/ Giveaways MagazineCirculation (millions)

Men's Health 17.5

Women's Health 7.5

Men's Fitness 6.5

Shape 19.2

Sports Illustrated 23.4

Self 16.8

Maxim Innovations

SWOT AnalysisSWOT AnalysisStrengths

• Unique product • Provides energy• Convenient • Maximizes absorption• Impulse buy

Weaknesses• More expensive • One flavor• Start up company• Limited resources

Opportunities• Creating a new niche • Differentiation• Health conscious Americans

Threats• Clearly established competition• Numerous substitutes

Maxim Innovations

CM and Net IncomeCM and Net IncomeWholesale Price: $1.59

Cost: - $0.14

Contribution Margin: $1.45

-4

-2

1

4

6

9

11

2007 2008 2009 2010 2011 2012 2013

Year

Dol

lars (

in m

illio

ns)

Worst Expected Best$0.14

$1.45

$0.40

$0.00

$0.50

$1.00

$1.50

$2.00 Mark Up

CM

Cost

Projected Net Projected Net IncomeIncome

Contribution Contribution MarginMargin

Maxim Innovations

Break EvenBreak Even

-10

-5

0

5

10

15

20

25

30

1 2 3 4 5 6 7

Year (1 = 2007)

Inco

me ($

Mill

ions)

Worst Case Expected Case Best Case

Maxim Innovations

• Net Present Value: $9,093,533

• Internal Rate of Return: 29%

• Projected Sales Price: $25 million

• Your share: $12.25 million

In Seven Years…

What the Future What the Future HoldsHolds

Maxim Innovations

Maxim Innovations

Why are there no other vitamins in Boost 12?

• Other vitamins may inhibit the absorption

• Other vitamins wouldn't contribute tothe product's energy aspect

• It would increase costs to add other vitamins

Chewing Gum Manufacturers• Primary

– Kangyi Foods and Drink Co., Ltd.• Gave us best price of $0.14 per 10 piece package • Were able to mix B12 with little extra cost• Included packaging was easiest at this point• Shipping was easiest from this point

• Secondary– Yake (China) Co., Ltd.

• Gave us price of $.18 per 10 piece package • Added cost for B12 incorporation• Not including packaging• Area is a little further away

Maxim Innovations

Vitamin B12 Suppliers• Primary

– TNN Development Limited• Cheap rate for Vitamin B12 • Fastest insured shipping for every purchase • Great Reputation• Closest to our manufacturer out of any of our contacts.

• Secondary– Chemivale Comercio Exterior

• Cheapest rate for Vitamin B12 • Fast, insured shipping • Located in Brazil

Maxim Innovations

Common Side Effects of Caffeine

• Dizziness

• Headache

• Muscle tension

• Nausea

• Unusual tiredness

• Jitters

• Anxiety

• Restlessness

• Confusion

• Dehydration

• Fast breathing

• Increasedheart rate

• Irritability

• Muscle twitching

• Stuffy Nose

• FrequentUrination

• Vomiting

• Nervousness

• Seizures

Maxim Innovations

Existings Products

**** It is a proven fact that Vitamin B12’s absorption is inhibited by certain vitamins, including Vitamin C, 1 of the 10 essential vitamins found in Vitaball

Delivers 100% Recommended Daily

Allowance of 10 essential vitamins

Delivers Vitamin B12 to promotes the production of red blood cells, increased

metabolism and more ENERGY

Gumballs Sticks

Children Energy Seeking Adults!

Purpose:

Distribution:

Vitaball Boost12

Target Market:

Maxim Innovations

Maxim Innovations

Vitamin B12 Absorption Through Tongue

According to the article, Vitamin B12 Cobalamin, sublingual (under the

tongue) delivery of Vitamin B12, such as through a gum or tablet form, is most

effective. This method of delivery allows the for the quickest way for B12 to be

absorbed straight into the bloodstream.

Maxim Innovations

Functional Gum Market“Wrigley, Cadbury and Hershey all

continue to take steps in new product development …. If a smaller company develops a functional gum type that is

able to challenge the existing hierarchy of teeth whitening gums, it

is likely that they would make an attractive target to one of these larger

players.”

Quote on www.gmid.euromonitor.com.

Maxim Innovations

Taste Preference

Table 7 Leading Flavors for Gum 2004-2006

Rank 2004 2005 2006

Spearmint  1.00 1.00 1.00

Peppermint  2.00 2.00 2.00

Mint  3.00 3.00 3.00

Bubble Gum  5.00 5.00 4.00

Wintergreen  4.00 4.00 5.00

Cinnamon  6.00 6.00 6.00

Juicy Fruit  7.00 7.00 7.00

Apple  9.00 9.00 9.00

Lemon  10.00 10.00 10.00

Source: Euromonitor International estimates

Maxim Innovations

Have you had your B12 today?

Recommended Dietary Allowances for Vitamin B12Age (years) Allowance

(μg/day)

1-3 0.9

4-8 1.2

9-13 1.8

14-18 2.4

19+ 2.4

Source: www.ods.od.nih.gov

Patent Pricing

• Patent 6,083,527: claims for candy like confections

• Patent 3,352,689: claims sugarless gum

• No patent on B12 Gum

Application Fee $300

Search Fee $500

Examination Fee $200

Post-Allowance Fee $1,400

International filing Fee $1,086

International Search Fee $2,059

Lawyer $2000

Initial Filing Fee $750

$8,295 TOTAL

Maxim Innovations

Maxim Innovations

1.Priced against vitamins

2.Cheaper then other forms

Bottle of 100 B12 Vitamins: $12

Vitamin B12 Patch: $24.95

Vitamin B12 Injection: $10-$20

Why is Boost 12 priced $1.99?

Maxim Innovations

Ad Cost per year Rate Base per year

Men’s Fitness 668,360 6,500,000

Men’s Health 1,461,600 17,500,000

Women’s Health 834,756 7,500,000

Shape 1,202,640 19,200,000

Total $4,167,356 50,700,000 Yr 1

Sports Illustrated 2,222,755 23,400,000

Self 1,230,636 16,800,000

4,167,356 50,700,000

Total $7,620,747 90,900,000 Yr 2

Magazine Advertising Costs

Maxim Innovations

Other Advertising CostsCounter:• $61,261 in year one• $81,158 in year two• No costs in year three, four, or five

Online:• $60,000 per year (years one through five)• *$15,000 per website• Four Websites: GNC, Men’s Health, Men’s Fitness, Shape

Gym Membership:• $5,760 per year (years one through five)• *$960 per membership, offered 6 times a year.

Maxim Innovations

Year One: $4,294,377

Year Two: $7,767,665

Year Three: $8,136,182

Year Four: $8,494,800

Year Five: $8,494,800

Total Advertising Costs Per Year

Maxim Innovations

Valuation of Company

Residual Value$16,093,533

NPV$9,093,533

Projected Sales Price$25,187,066

Maxim Innovations

Break Even (10% increase best case)

Projected Break-Even

$(10)

$(5)

$-

$5

$10

$15

$20

$25

$30

$35

1 2 3 4 5 6 7

Year

Inco

me

($ M

illi

ons)

Worst Case Best Case (10% increase) Expected Case

Maxim Innovations

Projected Income (10% sales increase)Projected Net Income

$(4)

$(2)

$-

$2

$4

$6

$8

$10

$12

1 2 3 4 5 6 7

Year

Inco

me

($ M

illio

ns)

Worst Case Best Case (10% increase) Expected Case

NPV = $14,419,233 IRR = 38%

Maxim Innovations

Sales Figures (Expected)YEAR 2008

# Stores

# boxes / month # boxes/ yr Total # boxes

GNC Stores 2529 5 60 151,740

Vitamin Shoppe 160 5 60 9,600

Vitamin Works 550 5 60 33,000

Whole Foods 193 4 48 9,264

World Gym 179 4 48 8,592

Gold's Gym 532 4 48 25,536

LA Fitness 400 5 60 24,000

Sports Clubs 135 4 48 6,480

Bally 367 4 48 17,616

Trader Joes 277 6 72 19,944

Total 5322 46 552 305,772

Maxim Innovations

Sales Figures (Expected Cont.)

Year 2009 (250% increase) 764,430Year 2010 (20% increase) 917,316Year 2011 (20% increase) 1,100,779Year 2012 (20% increase) 1,320,935Year 2013 (15% increase) 1,519,075Year 2014 (15% increase) 1,746,937

Maxim Innovations

Sales Forecast (Worst 10% decrease)

Year 2008 $275,195Year 2009 (250% increase) $687,987Year 2010 (20% increase) $825,584Year 2011 (20% increase) $990,701Year 2012 (20% increase) $1,188,842Year 2013 (15% increase) $1,367,168Year 2014 (15% increase) $1,572,243

Maxim Innovations

Sales Forecast (Best 5% increase)

Year 2008 $321,061Year 2009 (250% increase) $802,652Year 2010 (20% increase) $963,182Year 2011 (20% increase) $1,155,818Year 2012 (20% increase) $1,386,982Year 2013 (15% increase) $1,595,029Year 2014 (15% increase) $1,834,283

Maxim Innovations

Taxes (Expected)

2008 2009 2010 2011 2012 2013 2014

Earnings beforeTaxes $ (2,275,749) $ (342,301) $ 1,120,606 $ 4,182,971 $ 7,293,175 $ 10,069,046 $ 13,277,129

Tax Expense $ (773,755) $ (116,382) $ 381,006 $ 1,422,210 $ 2,479,680 $ 3,423,476 $ 4,514,224

NOL $ (773,755) $ (116,382) $ - $ - $ - $ - $ - Income TaxExpense $ - $ - $ 381,006 $ 1,422,210 $ 2,479,680 $ 3,423,476 $ 4,514,224

Total NOL $ (773,755) $ (890,137) $ (509,131) $ 913,079 $ - $ - $ -

Tax Payable $ - $ (773,755) $ (509,131) $ 913,079 $ 2,479,680 $ 3,423,476 $ 4,514,224

Maxim Innovations

Taxes (Worst Case)

2008 2009 2010 2011 2012 2013 2014

EBIT $ (2,684,659) $ (1,364,578) $ (106,125) $ 2,553,435 $ 5,337,732 $ 7,820,286

$ 10,691,055

Tax Exp $ (912,784) $ (463,957) $ (36,083) $ 868,168 $ 1,814,829 $ 2,658,897

$ 3,634,959

NOL $ (912,784) $ (463,957) $ (36,083) $ - $ - $ - $ -

Income Tax

Exp $ - $ - $ - $ 868,168 $ 1,814,829 $ 2,658,897

$ 3,634,959

Total NOL $ (912,784) $ (1,376,741) $ (1,376,741) $ (508,573) $ 1,306,256 $ -

$ -

Tax Pay $ - $ (912,784) $ (1,376,741) $ (508,573) $ 1,306,256 $ 2,658,897

$ 3,634,959

Maxim Innovations

Taxes (Best Case)

2008 2009 2010 2011 2012 2013 2014

Earnings before Taxes

$ (2,071,293) $ 168,837 $ 1,733,972 $ 4,997,739 $ 8,270,897 $ 11,194,721 $ 14,572,800

Tax Expense $ (704,240) $ 57,405 $ 589,551 $ 1,699,231 $ 2,812,105 $ 3,806,205 $ 4,954,752

NOL $ (704,240) $ - $ - $ - $ - $ - $ -

Income Tax Expense $ - $ 57,405 $ 589,551 $ 1,699,231 $ 2,812,105 $ 3,806,205 $ 4,954,752

Total NOL $ (704,240) $ (646,835) $ (57,285) $ 1,641,947 $ - $ - $ -

Tax Payable $ - $ (646,835) $ (57,285) $ 1,641,947 $ 2,812,105 $ 3,806,205 $ 4,954,752