Business Plan Analysis – Private Concepts

Memorandum Re Business Plan Assessment Private Concepts Critically analyzing a employment concern envision for its viability and fortune for success is short necessary from any s exitholders perspective. Doing so aides an investor in knowing whether or non to invest, a bevel in deciding on a loan, or thus far a partner in his/her decision to join a venture. precisely whitethornhap most importantly, a critical analysis of a logical argument political program can and go away help the entrepreneur to assess whether or non an idea under its current platform is worth undertaking, or if it is defend to the drawing board they go. The purpose of this memo is to assess the business proposal of Private Concepts, a company hoping to bring to trade The Pevlon, a cervical cancer screening device made for private, in-home use. The hazard for such a device absolutely exists both here in the United States and abroad.For mavin, the political platform mentions The Breast and Cervica l Cancer Mortality Act of 1990 which, mandated a across the country program to increase rise to power of medically underserved women to comprehensive breast and cervical cancer screening services, and when coupled with the Patient Protection and Affordable wish Act that was recently passed, the amount of free (to consumer paid for by the government) access to this intersection creates potential for a high demand in this country.In external countries however, such as rural China and rase Africa, where access to health care and proper healthcare facilities can be extremely rare, the appetite for this shell of harvest-time could be tremendously significant. And thither lies the premier issue with this business plan. tally to the Lancet Oncology medical journal, Volume 11, Issue 12, 75,000 women develop cervical cancer and 40,000 women die from the disease in China each year. Those meter in the United States are further about 12,000 and close to 4,000 separately (cdc. ov). This exemplifies a larger need for this convergence abroad as conflicting to aright here in the states. And to focus on the opportunity in China, a Wall Street Journal publication explains how Chinas healthcare system is lacking in general, just puts a microscope on the disparity in quality healthcare between rural and urban areas (Burkitt, 2012). These rural areas in China represent a large opportunity (much larger than any market in the United States) for The Pevlon.And so although the opportunity does exist for the business plans product, it is evident that the opportunity accentuated in the business plan is not the optimal one (aside from appealing to non-profits or other entities that would utilize the Pevlon in charitable, undoubtedly foreign ventures this should learn been a more significant portion of the plan). Additionally, the opportunity in the United States has not necessarily been proven to the point where one could consider the need for the product as pervasive e nough to where the consumer is willing to pay for it.And pay for they would redeem to, because as the plan notes in the chart on summon 10, a Pevlon screen costs 50% more than a typical boob colly. This exemplifies that pricing is going to be an issue. The health care market is exceedingly dependent on the insurance industry, especially when thither are product substitutes. Take pharmaceuticals for example. In group health care, policies are dictated by the contract that is in place and the majority of these contracts will sway the indemnity holder to utilize generic medications.This is done by the insurance postman covering a larger percentage of generic medications than name fool ones, which ultimately costs the carrier less. So if a pap smear is less costly by 50% than a Pevlon test, carriers may whitewash cover the device, tho the incentive to utilize the cheaper role will absolutely be in place. Additionally, the business plan identifies lower income women as a targe t market, but fails to explain how a more expensive procedure will be a viable option for this segment group. But even when the entire U. S. arket (via a sample size) is observed on rapscallion 19 of the plan, less than half of the women surveyed (46%) stated they would utilize the in-home Pevlon test even if most or all of it was covered by insurance. And if insurance reimbursement is outside completely, only 11. 2% of women would purchase the product. It would be interesting to see if thither were follow up inquiries related to this line of questioning because a possibleness is that some women, or maybe even a lot of women, may not trust themselves to complete such an important test at home.These women may only when prefer to rely on the expertise of a medical professional. And along these same lines, I feel as though the plan is silent on a very important fount when it comes to assessing the true market of this product how many women are in occurrence un lucky with going to a physicians office to shake up a pap smear completed and would those women be more comfortable completing such a screen at home?Yes, there is a quote stating how uncomfortable the procedure is (which is in fact the first thing the reader sees underneath the Executive Summary heading), but it is evenhandedly suspect that this quote is anonymous and that there is no quantifiable inference proving this notion to be true. So what is the actual oomph of this product? there really is no proof of it within the business plan and if I was investing in this product, I would need this proof. Aside from the ambiguous desirability of the product, there are a add up of other concerns that should really charge out to the potential investor.On page 12 of the business plan there is a section that lays out the testing and approval stage for the Pevlon device. on that point are 6 steps in this section and only 1 of which withdraw been completed, which happens to be the least significant of steps. The remaining rigmarole of securing FDA approval, obtaining the jet-propelled plane light to conduct clinical studies, actually conducting these studies, etc. could easily take upwards of a decade to complete. From the perspective of an investor or a bank assessing a loan, this is entirely too long a process for soulfulness to simply START making their money back.This exemplifies how difficult a market healthcare can be to get into, and that the barriers involved are simply too high. Additionally, the Pevlon is not necessarily a onetime revenue generator, but it comes uncomfortably close. In 2009, the American College of Obstetricians and Gynecologists (ACOG) released new cancer screening guidelines. According to ACOG, women now need to begin screening at age 21 as opposed to 18, and women ages 21 to 30 only need to be screened once every two years women 30 and older only once every 3 years (Cox, 2009).The final qualms that I have concerning this business plan is the windo w of opportunity associated with the product, and the amount of time it will take for Private Concepts to become a profitable company. There does not appear to be an actual window of opportunity as the business plan does not thoroughly prove the market segment. Anecdotally I polled a number of women in my life with whom I am comfortable bring this subject up and all of them (4) took the opinion that their screenings are not a major source of stress or discomfort, but rather they have come to accept it as part of the routine of life. And in regards to fit a profit generating entity, right up front on page 3 of the business plan, it is shown in the chart that Private Concepts would not be in the black until 5 years of doing business. Whats most concerning is that 5 years is still merely a hypothesis and that the organization is desire over three million dollars in funding basically right out of the gate. Conceptually, the idea of a self administered, in home cervical cancer screeni ng is a good idea.It poses benefits such as whatchamacallit and avoiding uncomfortable screenings at a physicians office. Private Concepts preoccupied the mark in their business plan however, in a number of ways. The market was identified too ambiguously and the plan did not intelligibly exemplify certain(a) key aspects of said market such as how many women actually would prefer an in home screen versus one performed in a physicians office. Where to market and focus gross sales efforts was clearly stated, however, the idea to sell first in the United States is not the best possible plan of action.Private Concepts should as the plan mentions, manufacture the product off shore in order to maximize profit margins, but at the same time the pricing point should be rethought easily in order to capitalize on the more fruitful markets of places handle rural China and Africa. Appealing to non-profits and government entities that might focus on these foreign demographics was a small pi ece of the business plan, but it should have been more of a focus.Finally, in this assessment I had the advantage of back(prenominal) sight and context. This business plan won the Moot Corp rivalry in 2002 with what appeared to be a viable business plan at the time. This product has yet to come to market and I was unable to induce anything stating that the Pevlon has been approved by the FDA. This does not necessarily hold any military posture on this analysis of the business plan however, it does prove to a certain extent, a lot of the shortcomings that were found within this business plan.Academically and structurally the plan was very well done, however in practical application it is blowzy to see how and why the Pevlon is still an unknown product to virtually the totality of the woman population in the United States. Arbyn, Marc. HPV-Based Cervical Cancer book binding in China. The Lancet Oncology. 201011(12)1112 1113. Burkitt, Laurie. Report Chinas Healthcare governance Deeply Sick. The Wall Street Journal. http//blogs. wsj. com/chinarealtime/2012/08/29/report-chinas-health-care-system-deeply-sick. 9 August 2012. image Accessed 23 January 2013. Cervical Cancer Statistics. Centers for Disease Control and Prevention gynecologic Cancers. http//www. cdc. gov/cancer/cervical/statistics. 20 December 2012. Date Accessed 23 January 2013. Cox, Lauren & Dr. Joshua Hundert. naked as a jaybird Cervical Cancer Screening Guidelines No More Annual soft diet Smears. ABC, Good Morning America. http//abcnews. go. com/GMA/OnCall/guidelines-ditch-annual-pap-smears/story? id=9131632. 20 November 2009. Date Accessed 23 January 2013.