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Medical Device Business Plan

Published Nov.06, 2023

Updated Apr.23, 2024

By: Brandi Marcene

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Table of Content

Medical Device Business Plan Sample

A medical device business plan is a document that outlines how to start and run a successful company that produces and sells products that diagnose, treat, or prevent diseases or injuries. Navigating the vast and expanding medical device sector presents thrilling opportunities alongside complex hurdles. A well-crafted business plan illuminates the route to success. Articulate your vision, milestones, tactics, and budgetary forecasts.

A business plan should also demonstrate how you will stand out from the crowd, satisfy users, adhere to regulations, and uphold ethical standards. A medical billing business plan is a specific type of medical device business plan that focuses on how to provide billing and coding services for healthcare providers.

In this article, we will provide you with a medical device business plan sample that you can use as a template or a reference for your business plan. We will cover the following sections:

• Executive Summary
• Company Overview
• Industry Analysis
• Customer Analysis
• Competitive Analysis
• Marketing Plan
• Operations Plan

Management Team

• Financial Plan

Executive Summary Section of Our Medical Device Business Plan

Business overview.

Medix is a medical device company that develops and sells innovative and affordable devices for diabetes management. We aim to enhance the well-being and health results of those managing diabetes. We aim to offer user-friendly and dependable products that assist in tracking and regulating blood sugar levels.

Products and Services

Medix offers two main products:

• Medix Glucometer – A smart glucose meter that connects to a mobile app via Bluetooth and provides accurate and instant readings of blood glucose levels.
• Medix Patch – A wearable patch that continuously measures blood glucose levels through the skin without needing finger pricks or test strips.

Customer Focus

Medix focuses on serving people with diabetes, seeking convenient and affordable solutions to manage their condition. According to the IDF Diabetes Atlas 10th edition report , 537 million adults (20-79 years) live with diabetes – 1 in 10. Experts predict that this number will rise to 643 million by 2030 and 783 million by 2045. Therefore, there is a huge demand for effective and accessible diabetes care products.

Leo Clark and Aria Bennett, two experienced entrepreneurs with biomedical engineering and business administration backgrounds, founded Medix. Leo is the CEO and head of product development, while Aria is the COO and head of marketing and sales. A team of qualified engineers, designers, developers, marketers, salespeople, and advisors supports them.

Success Factors

Medix has several competitive advantages that will enable it to succeed in the medical device industry:

• Innovation with cutting-edge technology to create novel devices
• High standards of quality and safety in every aspect of devices
• Customer satisfaction by providing user-friendly devices
• Social impact by addressing a major health problem globally

Financial Highlights

Medix seeks $5 million in seed funding to launch its products and scale its operations. The company projects to generate $1.2 million in revenue in the first year, $3.6 million in the second year, and $10.8 million in the third year, with a gross margin of 60% and a net profit margin of 20%. The company expects to break even in the second year and reach a valuation of $50 million by the end of the third year.

Company Overview Section of Our Medical Device Sales Business Plan

Who is Medix Medical Supply?

Medix dedicates itself to developing and selling innovative, affordable, and reliable devices for diabetes management. Our products help people with diabetes to monitor and control their blood glucose levels with ease and effectiveness, leading to better health outcomes and an improved quality of life.

Medix Medical Supply History

Medix is a company that provides innovative solutions for diabetes care. It was founded by Leo Clark and Aria Bennett in 2023, who both personally experienced the challenges and frustrations of living with diabetes. These challenges included frequent finger pricks, expensive test strips, inaccurate readings, and complicated insulin injections.

They started Medix with their personal funds and an incubator grant to address these issues. Medix developed two products – the Medix Glucometer and the Medix Patch – to make diabetes monitoring and treatment easier, more accurate, and more affordable.

The Medix products have received regulatory approvals from the Food and Drug Administration (FDA) and the European Medicines Agency (EMA). They are now ready for launch in the US and European markets. For more information, please refer to our dentistry business plan .

Legal Structure

Medix, an LLC registered in Delaware, USA, has obtained ownership by Leo Clark (60%) and Aria Bennett (40%). Additionally, the company has applied for a patent for its products in the US Patent and Trademark Office (USPTO).

Industry Analysis Section of Our Medical Device Business Plan

The medical device industry is one of the world’s most innovative and dynamic sectors. Fortune Business Insights reported that the global medical device market was valued at $512.29 billion in 2022 and can grow from $536.12 billion in 2023 to $799.67 billion by 2030, at a CAGR of 5.9%.

The medical device industry is driven by several factors, such as:

• The increasing prevalence of diseases and the aging population
• The rising demand for minimally invasive and personalized treatments
• The advancement of technology and digitalization
• The emergence of new markets and segments

Customer Analysis Section of Our Medical Supply Business Plan

Demographic profile of target market.

Medix’s target market is the US market, which ranks third for the highest number of people with diabetes. We target diabetic people looking for convenient, affordable solutions to manage their condition. 

According to the National Diabetes Statistics Report by CDC, here are some interesting stats about why the US market is best for Medix:

• 37.3 million people have diabetes (11.3% of the US population)
• 28.7 million people are diagnosed, including 28.5 million adults
• 8.5 million people are undiagnosed (23.0% of adults)
• 96 million people aged 18 years or older have prediabetes (38.0% of the adult US population)
• 26.4 million people aged 65 years or older (48.8%) have prediabetes

The demographic profile of our target market is as follows:

• Age – We target all ages, mainly the young and middle-aged, who are tech-savvy and have more money to spend. A CDC report says 34.1 million adults aged 18 years or older—or 13.0% of all US adults—have diabetes.
• Gender – We target both males and females, as diabetes does not discriminate by gender. A NIDDK (NIH) report says a higher percentage of men (41%) than women (32%) have prediabetes.
• Income – We target all income levels, mainly the low and middle-income who need better healthcare solutions. An NCBI (NIH) report says 80% of the adults worldwide with diabetes live in low- and middle-income countries (LMICs).

Customer Segmentation

Based on our market research and customer feedback, we have identified four main customer segments for our products:

• Segment A – Tech-savvy innovators who value quality, performance, and convenience. They share their views online.
• Segment B – Cost-conscious buyers who seek affordable and effective products. They trust their peers’ recommendations.
• Segment C – Health-conscious improvers who want products that motivate and support them. They join online health communities.
• Segment D – Compliance-driven users need products that ensure safety, security, and simplicity. They depend on their health providers and caregivers.

The table below summarizes our findings:

Based on the table, we have decided to target segments A and B as our primary segments, and segments C and D as our secondary segments.

Competitive Analysis Section of Our Medical Equipment Producer Business Plan

Direct and indirect competitors.

Our direct competitors are other medical device companies that offer similar or substitute surgical medical equipment for diabetes management. Some of the major players in this category are:

1. Abbott – A global healthcare company that offers a range of products for diabetes care with mobile apps for real-time data and insights.

• Strong brand recognition
• Global presence
• Innovation capabilities
• Customer loyalty

Weaknesses:

• Limited availability
• Technical issues

2. Dexcom – A medical device company specializing in CGMs for diabetes management. These devices use sensors to record and transmit data to a receiver or a smartphone.

• High accuracy
• Reliability
• Convenience
• Customer satisfaction
• Short sensor lifespan
• Skin irritation

3. Medtronic – A medical technology company that offers a range of durable medical equipment for diabetes care, such as insulin pumps, CGMs, and APSs. The system connects to a mobile app to monitor and control settings.

• Leadership position
• Advanced technology
• Clinical evidence
• Customer support
• Safety concerns
• Regulatory hurdles
• Competition

Our indirect competitors are other healthcare providers or solutions that offer alternative or complementary ways to manage diabetes, such as medications, diet plans, exercise programs, coaching services, etc. Refer to our hospital business plan to learn more.

Competitive Advantage

Medix’s unique value proposition and competitive advantage over its competitors are:

• Medix is more innovative
• Medix is more convenient
• Medix is more versatile
• Medix is more affordable
• Medix is more user-friendly

Marketing Plan Section of Our Medical Device Business Plan

Promotions strategy.

We will promote our products using online and offline channels to attract and retain customers. Our promotional mix consists of:

• Advertising – Online platforms (e.g., Google Ads, Facebook Ads) and offline media (e.g., newspapers, billboards) to deliver relevant and engaging messages.
• Public Relations – Press releases, media interviews, podcasts, webinars, etc., to generate positive publicity and exposure. Social media platforms (e.g., Facebook, Twitter) to interact and communicate with customers and stakeholders.
• Sales Promotion – Discounts, coupons, free samples, free trials, referrals, loyalty programs, etc., to stimulate sales and repeat purchases. Contests, sweepstakes, giveaways, etc., to create excitement and buzz.
• Personal Selling – Direct sales, telemarketing, email marketing, etc., to contact and persuade customers to buy our products. Online platforms (e.g., Amazon, eBay, Shopify) to sell our products directly.

We will use a value-based pricing strategy that reflects the value and benefits of our products and our competitive advantage. We will also offer competitive pricing that matches or undercuts our competitors’ prices.

We will charge $100 for each Medix Glucometer and $50 for each Medix Patch. We will also generate recurring revenue from the sales of test strips ($0.5 each) and insulin cartridges ($10 each). We estimate that each customer will use an average of 100 test strips and 12 insulin cartridges per year.

Operations Plan Section of Our Medical Device Business Plan

Operation functions.

We do these core activities to offer our products and services to our customers:

• Product Development – We research, design, test, and improve our products using agile methods, customer feedback, market trends, and tools like GitHub, Jira, Figma, etc.
• Manufacturing – We produce our products on a large scale and high quality by outsourcing to a reliable contract manufacturer.
• Distribution – We deliver our products to our customers quickly and cheaply using direct and indirect channels in different regions or countries.
• Customer Service – We support and assist our customers before, during, and after their purchase using various channels and methods.

Milestones and Timeline

We have these specific goals and objectives to track our progress and success in our operation functions:

• June 2024: Complete R&D, testing, prototyping of products
• September 2024: Obtain regulatory approvals and certifications
• December 2024: Launch marketing campaign and product launch in the US
• March 2025: Market research for Europe entry
• December 2025: Launch Europe marketing, market entry
• March 2026: Invest in production capacity
• June 2026: Expand manufacturing workforce
• December 2026: Evaluate production, increase to 100k units/month

Management Team Section of Our Medical Device Business Plan

Founders and co-founders.

Leo Clark, a biomedical engineer with type 1 diabetes, and Aria Bennett, the daughter of a type 2 diabetic and a business administrator, founded Medix. Leo is responsible for the product development function, while Aria leads the marketing and sales function. Both have several years of experience working in their respective fields and personal and professional experience with diabetes.

Other Key Team Members

• Alice Lee – Our chief engineer
• Bob Chen – Our chief developer
• Carol Wang – Our chief designer
• Dave Jones – Our chief marketer
• Emma Smith – Our chief salesperson

Financial Plan Section of Our Medical Device Business Plan

Key revenue and costs.

Medix’s main sources of revenue, along with pricing, are:

• Medix Glucometer – $100 for each Glucometer
• Medix Patch – $50 for each Patch
• Test Strips – $0.5 for each test strip
• Insulin Cartridge – $10 for each cartridge

We estimate that each customer will use an average of 100 test strips and 12 insulin cartridges per year.

Medix’s main categories of expenses are:

• Cost of Goods Sold (COGS) – Our main cost of goods sold is the cost of materials, components, parts, and additional supplies. We estimate that the COGS per unit is $40 for the Medix Glucometer, $20 for the Medix Patch, $0.1 for the test strip, and $2 for the insulin cartridge.
• Operating Expenses (OPEX) – Our main operating expenses are the costs we incur for running and operating our business, such as salaries, rent, utilities, marketing, advertising, R&D, etc. Our OPEX will be 40% of our revenue in the first year, 35% in the second year, and 30% in the third year.

Funding Requirements and Use of Funds

Funding Requirements – We seek $5 million in seed funding to launch our products and scale our operations. We have already raised $500,000 from our savings and a small grant from a local incubator. We need an additional $4.5 million to cover our expenses for the next 18 months until we reach the break-even point.

Use of Funds – We will use the funds for the following purposes as highlighted in the below chart:

Key Assumptions

• Market size for our products is 10% of the total number of people with diabetes in the US and Europe
• Market share is projected to grow from 107,000 customers in 2024 to 444,000 customers in 2026
• Sales volume is projected to grow from 321,000 units in 2024 to 1.33 million units in 2026
• Gross margin is projected to be 60% in all three years
• Net margin is projected to grow from 20% in 2024 to 30% in 2026

Financial Projections

Based on the above assumptions, we have prepared the following financial projections for the next three years:

Income Statement

OGSCapital – Your Partner for Medical Device Startup Success

With over a decade of experience, at OGSCapital, we have helped various entrepreneurs craft winning business plans. Our consultants provide end-to-end support – from market research and competitor analysis to realistic profitability forecasts. We understand the medical device industry inside-out, including regulations, manufacturing, and distribution.

Whether you need help with your hospital feasibility study , medical equipment manufacturing business plan, or medical supply store business plan, we tailor our approach to your specific product and goals. Partner with us to launch your startup on the path to profitability and rapid growth.

Frequently Asked Questions

How to start a medical device business.

A strategic business plan is a key ingredient in a startup medical device company. But that alone won’t cut it – the company also requires a talented group of professionals, structured product development procedures, a plan for meeting regulatory guidelines, and effective marketing tactics. A distributor or a medical equipment supplier can help distribute the devices.

How profitable are medical devices?

The medical equipment industry is booming with high growth potential. The average operating margin for medical equipment and supplies companies averages 2.87%. The medical device market will grow at a CAGR of 5.5% to 5.9% from 2022 to 2030.

How do I market my medical device?

As highlighted in our Medical Clinic Business Plan , some popular marketing channels to market a medical device include online platforms, social media, trade shows, conferences, webinars, publications, referrals, and testimonials. A medical equipment rental company can also help market the device.

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.

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Medical Device Business Plan Template

Written by Dave Lavinsky

Medical Device Business Plan

You’ve come to the right place to create your Medical Device business plan.

We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their Medical Device businesses.

Below is a template to help you create each section of your Medical Device business plan.

Executive Summary

Business overview.

MediTech LLC is a medical device company that sells Class I medical devices to hospitals, clinics, and other establishments in the medical industry. We manufacture a long list of devices including surgical instruments, syringes, and bandages. We know that patients can’t receive quality care if medical professionals don’t have good tools. Therefore, our mission is to provide the best medical devices in the industry so that all hospitals and clinics can provide the best care possible.

MediTech LLC is founded by Sarah Nelson. Sarah has considerable experience as a surgeon and used hundreds of medical devices throughout her career. She knows exactly what it takes to make high quality medical products and has made it her mission to create the best medical devices in the industry. Her expertise and knowledge of the industry will give us a considerable advantage over the competition.

Product Offering

MediTech LLC sells a long list of Class I medical devices. Class I medical devices are low risk devices and are unlikely to cause any harm to users. These include bandages, surgical tools, bedpans, gloves, and surgical masks. Our product list will grow and change depending on which devices are in high demand.

Customer Focus

MediTech LLC will primarily serve hospitals, clinics, and other medical organizations. Some products will be sold in stores to the public, including bandages, gloves, and face masks.

Management Team

MediTech LLC was founded by Sarah Nelson, a licensed and experienced surgeon. While working in the medical industry, she was frustrated by the quality of the medical devices she used. Her hospital routinely purchases low quality devices to save costs and this would affect the quality of her care. She researched what it would take to make higher quality versions of these products and decided to start a company that provides better quality devices for an affordable cost.

Success Factors

MediTech LLC will be able to achieve success by offering the following competitive advantages:

• We will provide the best quality medical devices in the industry. Our devices will help improve the quality of care that our clients give their patients.
• MediTech will price all of its products moderately so all of our clients and customers can afford them.
• Our founder has years of experience as a surgeon in the medical industry, bringing a vast amount of medical knowledge to the table. This will help us create perfect medical devices and products that all medical professionals will be eager to use.

Financial Highlights

MediTech LLC is currently seeking $1,400,000 to launch. The funding will be dedicated to the facility build out, purchase of initial equipment, working capital, marketing costs, and startup overhead expenses. The breakout of the funding is below:

• Facility design/build: $500,000
• Equipment: $200,000
• Six months of overhead expenses (payroll, rent, utilities): $400,00
• Initial supplies and inventory: $100,000
• Marketing and advertising: $100,000
• Working capital: $100,000

The following graph below outlines the pro forma financial projections for MediTech LLC.

Company Overview

Who is meditech llc.

MediTech LLC sells high-quality Class I medical devices to the medical industry. Our management team knows from experience that patients can’t receive the best care possible if physicians aren’t using the best tools. However, many medical organizations order lower quality devices in order to save on costs. At MediTech LLC, we are committed to making the best medical devices in the industry that are more affordable than the competition.

  MediTech LLC produces a long list of medical devices for the medical industry. These include bandages, surgical masks, gloves, surgical instruments, and bedpans. All of our products are Class I devices, meaning they present a low risk to the user.

MediTech LLC is founded by Sarah Nelson. Sarah has considerable experience as a surgeon and used hundreds of medical devices throughout her career. She knows exactly what it takes to make high quality medical products and has made it her mission to create the best medical devices in the industry. Her expertise and connections in the industry will ensure that MediTech LLC achieves its mission.

MediTech LLC History

Sarah Nelson founded and incorporated MediTech LLC as an LLC in June 2023. Though the company is currently running out of a small rented office, it will move to a large warehouse once the lease is finalized.

Since incorporation, MediTech LLC has achieved the following milestones:

• Developed the company’s name, logo, and website
• Determined equipment and fixture requirements
• Identified and established relationships with potential clients and suppliers
• Begun recruiting key employees

MediTech LLC Services

MediTech LLC manufactures and sells Class I medical devices. These include (but are not limited to) the following:

• Surgical instruments
• Non-electric wheelchairs
• Stethoscopes
• Surgical masks

Industry Analysis

The medical industry is dependent on the access to high-quality medical devices and products. From gloves and masks to EKG machines, every device used in the care of patients needs to be high quality and always in working order. Devices that are poor quality or don’t work properly can cause significant problems when being used to care for patients.

Medical devices are categorized into three classes. Class I devices are devices that pose very little risk to the user. These items include bandages, surgical instruments, and gloves. Class II devices are intermediate risk devices. These include intravenous pumps and CT machines. Class III devices are high risk and require a great amount of regulation. These devices are also critical to sustaining life. These include pacemakers and brain stimulators.

According to Fortune Business Insights, the medical device industry is valued at $539 billion and is expected to grow at a CAGR of 5.9%. Medical devices are constantly in high demand and are essential for the success of the medical industry. Therefore, now is a great time to start a new medical device company.

Customer Analysis

Demographic profile of target market, customer segmentation.

The company will primarily target the following customer segments:

• Medical clinics

Competitive Analysis

Direct and indirect competitors.

MediTech LLC will face competition from other companies with similar business profiles. A description of each competitor company is below.

Smith & Smith

Smith & Smith is a large corporation that sells thousands of products, including cosmetics, hygiene products, and certain medical devices. The medical devices they primarily produce include bandages, ointments, and low risk surgical and physician instruments. They sell many of their products to the general public (such as simple wound care devices) but also sell some devices to the medical industry. They will be a major competitor since they sell primarily Class I devices. However, they currently do not produce as many medical devices as MediTech LLC plans to produce, which gives us an advantage in the market.

MedMonitor is a medical device company that manufactures Class III medical devices. Some of their products include breast implants, pacemakers, implanted prosthetics, and defibrillators. They do sell some Class I and Class II products, such as gloves, wound care items, and surgical masks, but they are not a major manufacturer of these products. As such, we expect that MedMonitor will only be a minor competitor in the market.

MedSource is the source for most of the medical industry’s Class II medical devices. They produce a long list of devices including syringes, testing kits, contact lenses, and blood pressure cuffs. They do produce some products that can be categorized as Class I devices, but their product list does not overlap too much with ours. As such, we expect that MedSource will only be a minor competitor.

Competitive Advantage

MediTech LLC enjoys several advantages over its competitors. These advantages include the following:

• Management : Sarah Nelson has been extremely successful working in the medical industry and will be able to use her previous experience to design and manufacture the best medical devices in the industry.
• Relationships : Sarah knows many of the local leaders, business managers, and other influencers in the medical industry. These relationships will help her have access to quality materials and create an initial clientbase.
• Affordability : Thanks to Sarah’s connections within the industry, we are able to access high-quality materials for our products for an affordable cost. As a result, we can price all our products more moderately than the competition.

Marketing Plan

Brand & value proposition.

The MediTech LLC brand will focus on the company’s unique value proposition:

• High quality medical devices
• Affordable pricing
• Client-focused service

Promotions Strategy

The promotions strategy for MediTech LLC is as follows:

Social Media Marketing

Social media is one of the most cost-effective and practical marketing methods for improving brand visibility. MediTech LLC will use social media to develop engaging content in terms of the company’s product offerings. Engaging with prospective consumers and businesses on social media platforms like Facebook, Instagram, Twitter, and LinkedIn will also help understand changing customer needs.

Website/SEO

MediTech LLC will invest in developing a professional website that displays all of the products offered by the company. It will also invest in SEO so that the company’s website will appear at the top of search engine results.

Direct Mail

MediTech LLC will blanket businesses with direct mail pieces. These pieces will provide general information on MediTech LLC, offer discounts, and/or provide other incentives for companies to buy our products.

Advertisement

Advertisements in print publications like newspapers, magazines, etc., are an excellent way for businesses to connect with their audience. MediTech LLC will advertise its products in popular magazines and news dailies. Obtaining relevant placements in industry magazines and journals will also help in increasing brand visibility.

MediTech LLC’s pricing will be moderate, so clients feel they receive great value when purchasing our products.

Operations Plan

The following will be the operations plan for MediTech LLC. Operation Functions:

• Sarah Nelson will be the CEO of MediTech LLC. She will oversee the general operations and executive aspects of the business.
• Sarah is joined by Rebecca Smith who will act as the warehouse manager. She will train and manage the staff as well as oversee general production of our products.
• Sarah will hire an Administrative Assistant, Marketing Manager, and Accountant, to handle the administrative, marketing, and bookkeeping functions of the company.
• Sarah will also hire several employees to manufacture our products and maintain the equipment and machinery.

Milestones:

MediTech LLC will have the following milestones completed in the next six months.

• 02/202X Finalize lease agreement
• 03/202X Design and build out MediTech LLC
• 04/202X Hire and train initial staff
• 05/202X Kickoff of promotional campaign
• 06/202X Launch MediTech LLC
• 07/202X Reach break-even

Sarah Nelson is a former surgeon who is familiar with the most popular medical devices in the industry. She knows better than anyone that low quality products means low quality care for patients. As a surgeon, she was often disappointed with the quality of the medical devices she used. Her hospital would routinely choose the cheapest options to save costs. This resulted in more problems and low quality care being delivered to her patients. She is now passionate about starting her own company that provides high quality medical devices for an affordable cost.

Though Sarah has never run a business of her own, she has worked in the medical industry long enough to gain an in-depth knowledge of the operations (e.g., running day-to-day operations) and the business (e.g., staffing, marketing, etc.) sides of the industry. She will also hire several professionals to help her run other aspects of the business she is unfamiliar with.

Financial Plan

Key revenue & costs.

The key revenues for MediTech LLC will come from the sale of our medical devices and products.

The major cost drivers for the company will include manufacturing costs, overhead expenses, labor expenses, and marketing costs.

Funding Requirements and Use of Funds

• Six months of overhead expenses (payroll, rent, utilities): $400,000

Key Assumptions

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and pay off the startup business loan.

• Number of wholesale contracts:
• Year 5: 100
• Average order value: $5,000

Financial Projections

Income statement, balance sheet, cash flow statement, medical device business plan faqs, what is a medical device business plan.

A medical device business plan is a plan to start and/or grow your medical device business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can easily complete your Medical Device business plan using our Medical Device Business Plan Template here .

What are the Main Types of Medical Device Businesses? 

There are a number of different kinds of medical device businesses , some examples include: Class 1 medical device, Class 2 medical device, and Class 3 medical device.

How Do You Get Funding for Your Medical Device Business Plan?

Medical Device businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.

What are the Steps To Start a Medical Device Business?

Starting a medical device business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Medical Device Business Plan - The first step in starting a business is to create a detailed medical device business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast. 

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your medical device business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your medical device business is in compliance with local laws.

3. Register Your Medical Device Business - Once you have chosen a legal structure, the next step is to register your medical device business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.

4. Identify Financing Options - It’s likely that you’ll need some capital to start your medical device business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.

7. Acquire Necessary Medical Device Equipment & Supplies - In order to start your medical device business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your medical device business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Learn more about how to start a successful medical device business:

• How to Start a Medical Device Company

• [email protected]
• +1(800) 224-8308

How to Start a Medical Equipment Business 

The size of the global medical equipment market will reach around USD 893.07 billion by 2029. They help with everything from bandaging a sprained ankle to even diagnosing cancer. Medical equipment has diverse uses, from a layperson at home to hospital professionals. 

Medical equipment is a specific instrument, apparatus, machine, appliance, implant, or other similar or related article with a medical use. 

The business ecosystem in the medical equipment sector is diverse. Organizations are engaged in innovations that address critical health issues. With rising numbers, the medical equipment business can provide a good opportunity for new entrants. 

Types of Medical Equipment 

Medical equipment is used across the healthcare industry. Medical equipment is necessary to facilitate the medication process, from minor diagnosis to significant cure. Here are some examples for which the medical equipment can be used: 

• Diagnosis, treatment, and ailment of a disease 
• Providing information by examining the human body 
• Life support 
• Investigating, replacing, modifying the physiological process, etc. 

The medical equipment can be classified into the following  categories:

• Diagnostic Equipment
• Treatment Equipment
• Durable Equipment
• Life Support Equipment
• Laboratory Devices

Let us look at the detailed overview. 

1. Diagnostic Equipment 

CT Scan Machine (Source: A large white machine photo – Free CT scan Image on Unsplash )  

Diagnostic devices and instruments are used to diagnose a patient’s condition. A test is conducted on the patient’s vitals.  

• X-ray machines, Computed Tomography (CT scan), Magnetic Resonance Imaging (MRI), ultrasound, and other medical imaging machines are examples of diagnostic equipment. 
• Diagnosis equipment includes devices like stethoscopes, dopplers, pulse oximetry, etc. 

2. Durable Equipment 

Blood Sugar Level Detector (Source : Insulin Pump Pictures | Download Free Images on Unsplash )  

The equipment that provides treatment for specific conditions or illnesses is known as durable equipment. These are long-term reusable devices prescribed by doctors. They can be utilized at hospitals or homes. Some of the examples of durable equipment are: 

• Manual or electric wheelchairs 
• Walkers, crutches, canes (or any similar type of mobility assistive equipment) 
• Hospital beds 
• Pressure mattresses 
• Traction equipment 
• Insulin pumps 
• Nebulizers 
• Breast pumps 
• Patient Lifts 
• Stationary or portable oxygen tanks 
• Kidney machines 
• Oxygen Concentrators Ventilators 

3. Treatment Equipment 

Gloves (Source: Medical Gloves Pictures | Download Free Images on Unsplash )  

Treatment equipment is those devices or instruments used to treat specific conditions. These also include surgical supplies for situations that require surgical procedures. 

• Infusion pumps systematically insert drugs and other fluids into the patient’s circulatory system. These are used for infusing medication. It is in a controlled format. It will release the medication into the patient’s body at specific intervals. 
• LASIK surgical machines for treating eye conditions like myopia, hyperopia, and astigmatism are also examples of treatment equipment. 
• Medical lasers are devices emitting electromagnetic radiation for medical use. They are the treatment equipment that are necessary to treat various medical conditions. 
• Other examples of medical treatment equipment are diagnostic scopes, surgical caps, gowns, gloves, glasses, gauze, drapes, etc. 

4. Life Support Equipment 

Medical Kit (Source : Life Support Equipment Picture | Download Free Images on Unsplash )

Life support equipment is a medical device that maintains bodily functions. They help regulate organs and keep the patient alive during the healing process.  

Here are some examples of life support equipment. These examples are widely used in the healthcare sector. 

• Cardiopulmonary bypass (CB) devices, or the heart-lung machine, function as a patient’s temporary heart or lungs during surgery, thus supporting the patient’s life. 
• Medical ventilators help supply breathable air in and out of the lungs. They help patients with weak lungs get an adequate supply of oxygen.  
• Dialysis machines help in removing excess toxins from the blood. They are mainly used on patients suffering from kidney disorders to perform the functions of a kidney. 
• Incubators are another example of life-support medical equipment designed for newborn babies. They are created to mimic the environmental conditions suitable for the babies. 

5. Laboratory Devices 

Microscope (Source: Microscope Pictures | Download Free Images on Unsplash )  

Laboratory devices or equipment help analyze the human body’s blood, urine, and other biological material.  

Here are some examples: 

• Blood gas analyzers 
• Blood collection supplies 
• Chemistry analyzers 
• Electrolyte analyzers 
• Drug testing analyzers 
• Coagulation analyzers 
• Differential counters 
• Hematology analyzers 
• Urinalysis analyzers 
• Microbiological systems 

Opportunities in the Medical Equipment Business 

Medical equipment can provide help to medical practitioners and can also be used at home. They ensure easy diagnosis and quicker treatment for many medical conditions. Medical equipment benefits medical professionals and can also be a business opportunity. 

The global medical equipment market is growing at a CAGR of 6.99%. A medical equipment business can be a great idea to consider. It will cater to the medical industry’s demands and contribute to the country’s plans.  

Let us check out some of the best medical equipment business ideas.  

Disposable Medical Tools and Supplies 

Syringes (Source: Medical Syringes Pictures | Download Free Images on Unsplash )  

There is a growing need for disposable medical supplies. Items like gloves, masks, syringes and scrubs are some examples.  

There is a specific process needed for this business. You need to buy the products from a vendor and check them for quality. After that, these medical products can be sent to hospitals, pharmacies, and other medical facilities. You can use a network to distribute these products. This business idea promises a high ROI with minimal investment. 

Diagnostic Equipment Rental

Diagnostic equipment such as medical imaging machines are costly. The imaging machines are very few and cannot cater to the demands of rising medical conditions. Renting such equipment can be a good idea for a business. You can rent out your equipment to healthcare institutions that cannot afford the machinery. Using the healthcare email list , you can connect with the HCPs to pitch your services.  

Medical Equipment Repair 

You can start your medical equipment repair business with the right skills and technical knowledge. Healthcare facilities often enter an annual contract to repair and maintain their machines. This business can be started with very little investment. 

Medical Furniture Business 

Hospital Beds (Source: Hospital Beds Pictures | Download Free Images on Unsplash )  

It can be profitable to sell specific medical equipment like furniture. This includes stretchers, hospital beds, dental chairs, wheelchairs and more. Such equipment is often known as medical furniture. It needs to pass certain quality checks. A retail business where you can sell medical furniture to professionals in the healthcare sector will be profitable. 

Orthopedic Appliances 

Orthopedic appliances like braces, artificial limbs, etc., also have a good market. The customer base ranges from accident victims to disabled individuals. This business involves sourcing the appliances or manufacturing them and selling them. With the help of a well-researched orthopedic surgeons email list , you can contact the local orthopedic surgeons easily to sell your products. The investment is less but guarantees a high return. 

Telemedicine Services 

Nowadays, online consultations from doctors are increasing. People with a busy lifestyle choose to get an online medical consultation from a medical professional. Start a business that provides these services. You can start a platform that connects patients to the specialist doctor and seek consultation along with the medicines delivered to their doorstep. 

Steps to Start Medical Equipment Business 

With a range of business ideas that can be done, a good plan is required to start a medical equipment business. 

1. Choose Your Market

Find your medical niche first to kick-start your medical equipment business. Research the market size and demand for your product in the market. Define which sector you will cater to. For example, if you supply imaging machines, your target customers will be big healthcare institutions and diagnostic centers, not general physician clinics. 

Once you define your target customers, the process will be simpler. 

2. Identify your Target Market 

In the medical equipment business, there are many different sectors that you can choose to work in. You can supply various medical or surgical tools or purchase a medical furniture business. The more concentric goods you choose to supply, the more beneficial it will be. Dealing with limited SKUs will help you concentrate on your customers and provide them with excellent service. 

3. Choose a Location 

A prominent business location for your medical equipment business is imperative. Check for the available locations in the area from where the supply can be fulfilled quickly. A business location at the heart of the market can be useful to get all the inquiries for the products you sell. A place should be chosen with the transportation aspect in mind. Also, the business must have ample storage area to store your inventory. 

4. Create a Website

A website will be the face of your business. Secure a domain name and create a website. There are many options for hosting your website at affordable costs. Choose the best option and make a website easy to spot and surf. Implement the e-commerce tools to ensure buyers place orders online directly from your website. 

5. Choose Online Marketplace 

Having an online marketplace with your store gives you an edge over the others. Use online platforms to sell your goods. List the goods on Amazon, Craigslist, etc., to attract more customers. Implement online marketing strategies and get help from paid promotions. 

6. Secure Licenses 

Some medical equipment supplies businesses require licenses and registrations with the regulating authority. Ensure you comply with all the regulations before starting a medical equipment business. 

7. Fund Your Business 

Fund management is essential for any business. You should be able to record your funds and find ways to procure funds without incurring losses. You should come up with a plan to fund your business. You can bootstrap your business or opt for a loan from banking or financial institutions. Check the interest rates and make sure your profit margins are not hampered. 

8. Identify Vendors and Distributors 

Your vendors play an important role in your business. If you plan to supply medical equipment, you must be sure your vendors will give you your order in time. Also, choosing a vendor or a distributor should be done based on good service, better credit periods, and prompt returns and refunds. 

9. Market Your Brand 

Once you finish the above steps, marketing your brand is necessary. Your brand should be well known to the people. Proper marketing techniques need to be applied to market your brand. Various companies help you with your email marketing , digital marketing, telemarketing, etc. Choose someone who works in the medical field. 

For instance, TargetNXT can help provide you with a list of medical professionals’ email addresses that you can contact to grow your business. The facility to filter the lists based on various categories makes your work of choosing your target audience easy. 

Conclusion 

Crafting a medical equipment business plan is easy if you go through all the abovementioned pointers. The medical equipment business can give you an edge if you want to start a new business. With an increasing healthcare sector and medical device industry, your plan to start a medical equipment business will be profitable. 

Check for the niches that are available to set up your business in the healthcare space . A medical equipment business needs a proper location, planning, and strategy to grow. 

Make sure you define your niche and conduct a market survey to know the demand for your product before selling it. Also, collaborate with the pioneers of marketing like TargetNXT. Craft a successful medical equipment business plan, and you are ready. 

Working as a Sr. Content Writer at TargetNXT for more than 6 years, Krista has incorporated her deep insight of search engine optimization and B2B marketing to produce content that ranks high on SERP. She has a keen eye for database management that allows her to keep helping businesses with her contents.

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How to Start a Medical Supply Business

Starting a medical supply business can be very profitable. With proper planning, execution and hard work, you can enjoy great success. Below you will learn the keys to launching a successful medical supply business.

Importantly, a critical step in starting a medical supply business is to complete your business plan. To help you out, you should download Growthink’s Ultimate Business Plan Template here .

Download our Ultimate Business Plan Template here

14 Steps To Start a Medical Supply Business :

• Choose the Name for Your Medical Supply Business
• Develop Your Medical Supply Business Plan
• Choose the Legal Structure for Your Medical Supply Business
• Secure Startup Funding for Your Medical Supply Business (If Needed)
• Secure a Location for Your Business
• Register Your Medical Supply Business with the IRS
• Open a Business Bank Account
• Get a Business Credit Card
• Get the Required Business Licenses and Permits
• Get Business Insurance for Your Medical Supply Business
• Buy or Lease the Right Medical Supply Business Equipment
• Develop YourMedical Supply Business Marketing Materials
• Purchase and Setup the Software Needed to Run Your Medical Supply Business
• Open for Business

1. Choose the Name for Your Medical Supply Business

The first step to starting a medical supply business is to choose your business’ name.  

This is a very important choice since your company name is your brand and will last for the lifetime of your business. Ideally you choose a name that is meaningful and memorable. Here are some tips for choosing a name for your own medical supply business:

• Make sure the name is available . Check your desired name against trademark databases and your state’s list of registered business names to see if it’s available. Also check to see if a suitable domain name is available.
• Keep it simple . The best names are usually ones that are easy to remember, pronounce and spell.
• Think about marketing . Come up with a name that reflects the desired brand and/or focus of your medical supply business.

2. Develop Your Medical Supply Business Plan

One of the most important steps in starting a medical supply business is to develop your business plan. The process of creating your plan ensures that you fully understand your market and your business strategy. The plan also provides you with a roadmap to follow and if needed, to present to funding sources to raise capital for your business.

Your business plan should include the following sections:

• Executive Summary – this section should summarize your entire business plan so readers can quickly understand the key details of your medical supply business.
• Company Overview – this section tells the reader about the history of your medical supply business and what type of medical business you operate. For example, are you a medical equipment retailer, wholesale distributor, or online medical supply store?
• Industry Analysis – here you will document key information about the health care industry. Conduct market research and document how big the industry is and what trends are affecting it.
• Customer Analysis – in this section, you will document who your ideal or target customers are and their demographics. For example, how old are they? Where do they live? What do they find important when purchasing products like the ones you will offer?
• Competitive Analysis – here you will document the key direct and indirect competitors you will face and how you will build competitive advantage.
• Marketing Plan – your marketing plan should address the 4Ps: Product, Price, Promotions and Place.
• Product : Determine and document what products/services you will offer 
• Prices : Document the prices of your products/services
• Place : Where will your business be located and how will that location help you increase sales?
• Promotions : What promotional methods will you use to attract customers to your medical supply business? For example, you might decide to use pay-per-click advertising, public relations, search engine optimization and/or social media marketing.
• Operations Plan – here you will determine the key processes you will need to run your day-to-day operations. You will also determine your staffing needs. Finally, in this section of your plan, you will create a projected growth timeline showing the milestones you hope to achieve in the coming years.
• Management Team – this section details the background of your company’s management team.
• Financial Plan – finally, the financial plan answers questions including the following:
• What are the startup costs?
• What are your projected sales and expenses for the next five years?
• Do you need to raise funding to launch your business?

Finish Your Business Plan Today!

3. choose the legal structure for your medical supply business.

Next you need to choose a legal business structure for your medical supplies business and register it and your business name with the Secretary of State in each state where you operate your business.

Below are the five most common legal structures:

1) Sole proprietorship

A sole proprietorship is a business entity in which the owner of the medical equipment business and the business are the same legal person. The owner of a sole proprietorship is responsible for all debts and obligations of the business. There are no formalities required to establish a sole proprietorship, and it is easy to set up and operate. The main advantage of a sole proprietorship is that it is simple and inexpensive to establish. The main disadvantage is that the owner is liable for all debts and obligations of the business.

2) Partnerships

A partnership is a legal structure that is popular among small businesses. It is an agreement between two or more people who want to start a medical supply business together. The partners share in the profits and losses of the business. 

The advantages of a partnership are that it is easy to set up, and the partners share in the profits and losses of the business. The disadvantages of a partnership are that the partners are jointly liable for the debts of the business, and disagreements between partners can be difficult to resolve.

3) Limited Liability Company (LLC)

A limited liability company, or LLC, is a type of business entity that provides limited liability to its owners. This means that the owners of an LLC are not personally responsible for the debts and liabilities of the business. The advantages of an LLC for a medical supply business include flexibility in management, pass-through taxation (avoids double taxation as explained below), and limited personal liability. The disadvantages of an LLC include lack of availability in some states and self-employment taxes.

4) C Corporation

A C Corporation is a business entity that is separate from its owners. It has its own tax ID and can have shareholders. The main advantage of a C Corporation for a medical supply business is that it offers limited liability to its owners. This means that the owners are not personally responsible for the debts and liabilities of the business. The disadvantage is that C Corporations are subject to double taxation. This means that the corporation pays taxes on its profits, and the shareholders also pay taxes on their dividends.

5) S Corporation

An S Corporation is a type of corporation that provides its owners with limited liability protection and allows them to pass their business income through to their personal income tax returns, thus avoiding double taxation. There are several limitations on S Corporations including the number of shareholders they can have among others.

Once you register your medical supply business, your state will send you your official “Articles of Incorporation.” You will need this among other documentation when establishing your banking account (see below). We recommend that you consult an attorney in determining which legal structure is best suited for your company.

4. Secure Startup Funding for Your Medical Supply Business (If Needed)

In developing your medical supply business plan, you might have determined that you need to raise funding to launch your business. 

If so, the main sources of funding for a medical supply business to consider are personal savings, family and friends, credit card financing, bank loans, crowdfunding and angel investors. Angel investors are individuals who provide capital to early-stage businesses. Angel investors typically will invest in a medical supply business that they believe has high potential for growth.

5. Secure a Location for Your Business

There are a few things to consider when looking for a location for your medical equipment business. First, you’ll want to make sure the location is accessible and convenient for your customers. You’ll also need to have enough space to store your inventory and equipment. Finally, it’s important to find a location that is affordable. 

6. Register Your Medical Supply Business with the IRS

Next, you need to register your business with the Internal Revenue Service (IRS) which will result in the IRS issuing you an Employer Identification Number (EIN).

Most banks will require you to have an EIN in order to open up an account. In addition, in order to hire employees, you will need an EIN since that is how the IRS tracks your payroll tax payments.

Note that if you are a sole proprietor without employees, you generally do not need to get an EIN. Rather, you would use your social security number (instead of your EIN) as your taxpayer identification number.

7. Open a Business Bank Account

It is important to establish a bank account in your medical supply business’ name. This process is fairly simple and involves the following steps:

• Identify and contact the bank you want to use
• Gather and present the required documents (generally include your company’s Articles of Incorporation, driver’s license or passport, and proof of address)
• Complete the bank’s application form and provide all relevant information
• Meet with a banker to discuss your business needs and establish a relationship with them

8. Get a Business Credit Card

You should get a business credit card for your medical supply business to help you separate personal and business expenses.

You can either apply for a business credit card through your bank or apply for one through a credit card company.

When you’re applying for a business credit card, you’ll need to provide some information about your business. This includes the name of your business, the address of your business, and the type of business you’re running. You’ll also need to provide some information about yourself, including your name, Social Security number, and date of birth.

Once you’ve been approved for a business credit card, you’ll be able to use it to make purchases for your business. You can also use it to build your credit history which could be very important in securing loans and getting credit lines for your business in the future.

9. Get the Required Business Licenses and Permits

You will need a business license, a permit to operate as a medical supply business, and a permit to sell medical supplies. You may also need a sales tax permit. Check with your local business licensing office to find out what licenses and permits are required in your area.

10. Get Business Insurance for Your Medical Supply Business

The type of insurance you need to operate a medical supply business depends on the scope of the operation. 

Some business insurance policies you should consider for your medical supply business include:

• General liability insurance : This covers accidents and injuries that occur on your property. It also covers damages caused by your employees or products.
• Auto insurance : If a vehicle is used in your business, this type of insurance will cover if a vehicle is damaged or stolen.
• Workers’ compensation insurance : If you have employees, this type of policy works with your general liability policy to protect against workplace injuries and accidents. It also covers medical expenses and lost wages.
• Commercial property insurance : This covers damage to your property caused by fire, theft, or vandalism.
• Business interruption insurance : This covers lost income and expenses if your business is forced to close due to a covered event.
• Professional liability insurance : This protects your business against claims of professional negligence.

Find an insurance agent, tell them about your business and its needs, and they will recommend policies that fit those needs. 

11. Buy or Lease the Right Medical Supply Business Equipment

Medical supply companies need essential office equipment, such as computers, phones, printers, and fax machines. You may require other equipment depending on the scope of your operation. For instance, if you operate a warehouse for wholesale distribution, you may need a forklift to move inventory around. If you deliver medical supplies, you’ll need a vehicle for transport. It’s important to research the specific equipment you need to run your business.

12. Develop Your Medical Supply Business Marketing Materials

Marketing materials will be required to attract and retain customers to your medical supply business.

The key marketing materials you will need are as follows:

• Logo : Spend some time developing a good logo for your medical supply business. Your logo will be printed on company stationery, business cards, marketing materials and so forth. The right logo can increase customer trust and awareness of your brand.
• Website : Likewise, a professional medical supply business website provides potential customers with information about the products you offer, your company’s history, and contact information. Importantly, remember that the look and feel of your website will affect how customers perceive you.
• Social Media Accounts : establish social media accounts in your company’s name. Accounts on Facebook, Twitter, LinkedIn and/or other social media networks will help customers and others find and interact with your medical supply business.

13. Purchase and Setup the Software Needed to Run Your Medical Supply Business

To run a medical supply business, you need software to manage inventory, track sales, and manage customer relationships. You’ll also need accounting software to manage finances. There are many options available for medical supply business software. Some software companies offer all-in-one programs made specifically for medical supply stores. So, with a bit of research, you should be able to find one that suits your needs. 

14. Open for Business

You are now ready to open your medical supply business. If you followed the steps above, you should be in a great position to build a successful business. Below are answers to frequently asked questions that might further help you.

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With Growthink’s Ultimate Business Plan Template you can finish your plan in just 8 hours or less!

How to Start a Medical Supply Business FAQs

Is it hard to start a medical supply business.

No, it’s not too difficult to start a medical supply business. However, it does require some basic knowledge and understanding of the industry. The most important thing you'll need to get started is a good business plan.

How can I start a medical supply business with no experience?

The best way to start a medical supply business with no experience is to do some research. Learn about the industry, what products are in demand, and what prices to charge. You can also join an industry organization or attend trade shows to learn more about the business. You may want to consider working for a medical supply company and network with medical professionals before starting your own business. This will give you a chance to learn about the industry and gain some experience. Finally, create a business plan and secure financing before starting your business.

What type of medical supply business is most profitable?

The most profitable type of medical supply business is one that manufactures and distributes disposable medical supplies. These large medical supply companies can be exceptionally lucrative because there is a constant demand for their products and they typically have low overhead costs.

How much does it cost to start a medical supply business?

To start a small medical supply business, it will cost you approximately $5,000-$10,000. This includes the cost of setting up your business, getting inventory, and marketing your new business. Costs will be greater for a larger operation.

What are the ongoing expenses for a medical supply business?

Medical supply businesses have a few common ongoing expenses. The most significant expense is the cost of the supplies themselves. This can include anything from bandages and gauze to surgical equipment. Medical supply businesses must also account for the cost of delivering or shipping their supplies. In addition, these businesses often pay for ongoing advertising and marketing to make sure their products are seen by potential customers.

How does a medical supply business make money?

Medical supply businesses make money by selling products to hospitals, doctors' offices, and other medical facilities. They also make money by providing services such as equipment rentals and repairs. Some business owners also earn by taking their medical supply business online.

Is owning a medical supply business profitable?

A medical supply business can be profitable because it meets a fundamental human need. People will always need medical supplies, whether it is for themselves or for a loved one. Additionally, the demand for medical supplies is growing as the population ages and more people require treatment for chronic illnesses.

Why do medical supply businesses fail?

There are many reasons medical supply businesses can fail. A common one is that the company doesn’t understand the needs of its target market and lacks the right products and services to meet those needs. Additionally, many businesses do not have a clear marketing plan or strategy, which can doom them to fail.

Other Helpful Business Plan Articles & Templates

BUSINESS STRATEGIES

How to create a medical supply business plan

• Annabelle Amery
• Sep 5, 2023

When starting a business in the medical supply industry, creating a comprehensive and clear business plan is crucial to lay a strong foundation for success. This plan serves as a roadmap that guides the business owner through key aspects of the business's development and growth.

Crafting a well-structured medical supply business plan is not only essential for navigating the complexities of the medical industry, but also attracting potential investors, securing financing and establishing credibility.

Ultimately, a well-crafted medical supply business plan forms the bedrock of starting a successful medical supply venture, guiding the business toward achieving its goals in a dynamic and critical sector.

Looking to create a online business and get started with e-commerce ? Take Wix’s eCommerce website builder for a spin.

Benefits of starting a medical supply business plan

Writing a comprehensive business plan offers numerous advantages for any type of business . As it regards your medical supply business, a business plan is helpful for:

Attracting funding: A well-crafted business plan acts as a powerful tool to attract potential investors and raise money for starting a medical supply business. Investors want to see a clear understanding of the market potential, revenue projections and strategies for growth. A comprehensive plan demonstrates the business owner's commitment and professionalism, increasing the likelihood of obtaining financial support.

Resource planning: Starting a medical supply business involves a thorough understanding of the resources, supplies and staff needed to establish and operate the business smoothly. A detailed business plan forces you to research and outline the necessary equipment, regulatory compliance, logistics, staffing and partnerships. This clarity ensures that all aspects of your business are considered and addressed adequately.

Success planning: Creating a business plan enables business owners to develop a clear roadmap for success when starting a medical supply business. The plan outlines objectives, strategies and key performance indicators that guide your business's growth trajectory. It helps in setting measurable goals and tracking progress, allowing adjustments to be made to stay on course.

Identifying challenges and opportunities: A thorough market analysis within the business plan helps identify trends, challenges and opportunities in the medical supply industry. Understanding the competitive landscape, customer needs and industry shifts allows the business to tailor its offerings to meet market demands effectively.

Sustainability: Creating a financial plan within the business plan offers insights into revenue projections, expenses and profitability. It ensures that the medical supply business is financially viable and can sustain its operations in the long run. This plan also helps in managing cash flow and making informed decisions about budget allocation.

How to write a medical supply business plan in 6 steps

In the sections below, we’ll guide you through six essential steps to help you craft a comprehensive medical supply business plan that sets the stage for a thriving venture in the healthcare industry.

Executive summary

Business and domain names

Market analysis and research

Operations plan, marketing and advertising plan, financial plan, 01. executive summary.

The executive summary is a succinct overview of your medical supply business plan, providing a snapshot of the entire document. It encapsulates the essence of your business, its objectives, strategies and key points. This section is crucial as it often serves as the first impression for potential investors and stakeholders.

To craft a clear executive summary for your medical supply business, focus on introducing your medical supply business, its mission and its unique value proposition in the industry. Summarize the potential market demand for medical supplies. Then, highlight the types of medical supplies your business will offer, emphasizing any innovative or specialized items.

Describe what sets your medical supply business apart from competitors, such as quality, pricing, distribution network or customer service. You should also provide a glimpse into your revenue projections and growth potential, showcasing the financial attractiveness of your venture. Finally mention the initial funding required to launch your medical supply business and support its early operations.

Here’s an example of an executive summary for a medical supply venture: “MediAid Supplies is a pioneering medical supply business committed to providing healthcare professionals and facilities with the essential tools they need to deliver exceptional patient care. Our mission is to bridge the gap between quality medical supplies and their availability, ensuring that healthcare providers can focus on their vital roles without concerns about procurement challenges.

In an ever-evolving healthcare landscape, MediAid Supplies emerges as a reliable partner, offering a wide range of medical equipment, devices, and consumables. Our dedication to quality, affordability, and timely distribution positions us as a leader in the medical supply industry.

MediAid Supplies anticipates substantial revenue growth by addressing the escalating demand for reliable medical supplies and our commitment to unparalleled customer service. To achieve our vision, we are seeking strategic partnerships and investments that will support our expansion and outreach efforts.”

02. Business and domain names

Selecting a strong business name is crucial for a medical supply business to establish brand identity, build trust, and resonate with industry stakeholders. A well-chosen name should reflect professionalism, reliability and the scope of medical supplies offered. It's essential to ensure the chosen name is not already trademarked and is available for registration.

Using a business name generator can provide inspiration and generate creative ideas for your medical supply business name. Once the company name is finalized, securing a matching domain name for your business website is equally important in today's digital age.

Note: once you’ve settled on a business name and decided on the best structure for your business, you’ll want to register your business .

03. Market analysis and research

Incorporating a comprehensive market analysis and research section in your medical supply business plan is crucial. This section delves into understanding your target market, competitors and industry trends. It helps you craft effective marketing strategies and make informed business decisions.

04. Operations plan

The operations plan outlines practical aspects, such as the location of your medical supply business, premises design, equipment procurement, inventory management and staffing needs. It ensures you have a clear roadmap for effectively managing daily operations.

05. Marketing and advertising plan

The marketing and advertising plan lays out strategies and campaigns to effectively promote your medical supply business. It should highlight strategies such as digital marketing, trade shows, partnerships with healthcare facilities and campaigns that showcase the quality and reliability of your supplies.

Remember to keep your branding consistent no matter where you promote your business. Start by learning how to make a medical logo and then create your own with the use of a medical logo maker .

06. Financial plan

The financial plan is a critical component of a business plan for a medical supply business. It provides a comprehensive overview of the financial aspects of your business, including startup costs, funding sources, revenue projections, expenses and the time frame for reaching profitability. This section helps you demonstrate the financial viability of your business and assists potential investors and lenders in evaluating the potential return on their investment.

Startup costs and funding

Outline the initial investment required to launch your medical supply business. This includes expenses, such as:

Costs associated with procuring the initial inventory of medical supplies, equipment and devices.

Costs for leasing or purchasing a suitable location, interior design and furnishing.

Expenses for business registration, licenses, permits and compliance with industry regulations. For example, starting an LLC where costs vary between states.

Costs for creating a strong brand presence, including logo design, website development and marketing campaigns. Learn more about how to make a medical website.

Estimate costs for utilities, insurance, salaries and any other recurring expenses for the initial period.

Funding sources

Identify the sources of funding you intend to utilize to cover your startup costs. These sources may include:

Personal savings: Investment from your personal savings or assets.

Bank loans: Securing loans from financial institutions.

Investors: Attracting equity investors who provide capital in exchange for ownership.

Partnerships: Partnering with other businesses or individuals to pool resources.

Revenue projections

Provide an estimate of your medical supply business's potential revenue over a specific period. Consider factors like the average transaction value, volume of sales and the pricing strategy for your products. Projections can be broken down by months or years to give a clear understanding of your growth trajectory.

Expenses and costs

Detail the anticipated expenses that your medical supply business will incur. Categorize them into fixed costs (rent, utilities, salaries) and variable costs (inventory, marketing, shipping). This breakdown helps you assess your business's cost structure and manage cash flow effectively.

Profit and loss projection

Present a profit and loss (P&L) projection that outlines your expected revenue and expenses over a specific period. The P&L statement calculates your net income or loss by subtracting total expenses from total revenue. This projection provides a clear picture of your business's financial health and potential profitability.

Break-even analysis

Perform a break-even analysis to determine the point at which your medical supply business's total revenue equals its total costs. This analysis helps you understand the minimum level of sales required to cover your expenses and begin generating profits.

Time frame for profitability

Indicate the expected time frame for your medical supply business to become profitable. This depends on various factors, including market demand, pricing strategy, marketing efforts and operational efficiency. Providing a realistic estimate helps stakeholders understand when they can expect a return on their investment.

Cash flow forecast

Prepare a cash flow forecast to track the inflows and outflows of cash in your medical supply business. This forecast helps you manage liquidity, plan for expenses and ensure you have adequate funds to cover operational needs.

Medical supply business plan example: MediCare Supplies

This draft business plan provides a really great starting point for creating your very own medical supply business plan. Remember to customize the content to your specific goals, target market, and location. Make sure to regularly review and update your business plan as your business grows to ensure its relevance and future success.

MediCare Supplies is a forward-thinking medical supply business aimed at providing high-quality medical equipment, devices, and consumables to healthcare facilities and professionals. Our mission is to enhance patient care by ensuring seamless access to reliable medical supplies. Leveraging our industry expertise and commitment to excellence, we aspire to become a trusted partner in the healthcare sector.

Company and domain names

Company name: MediCare Supplies

Domain name: www.medicaresupplies.com

Our chosen company name, "MediCare Supplies," signifies our dedication to supplying essential medical resources that contribute to the well-being of patients. The corresponding domain name, www.medicaresupplies.com, reinforces our commitment to providing a convenient online platform for healthcare professionals to access our products and services.

Our thorough market analysis indicates a growing demand for reliable medical supplies due to the expanding healthcare industry. Research reveals the need for a comprehensive supplier that offers a wide range of high-quality products. Our target audience includes hospitals, clinics, nursing homes and private practitioners seeking efficient procurement solutions.

Location: Strategically situated near medical facilities to facilitate timely deliveries and direct engagement.

Premises: A well-organized and efficient warehouse designed to accommodate our inventory and streamline operations.

Equipment: Cutting-edge inventory management systems and logistics software to optimize distribution and minimize errors.

Staffing: A team of experienced professionals in procurement, logistics and customer service to ensure seamless operations and client satisfaction.

Our marketing plan includes:

Digital presence: Making a website , optimizing it for search engines and maintaining active social media accounts to reach a wider audience.

Strategic partnerships: Collaborating with healthcare associations, medical facilities and industry influencers to increase brand visibility and credibility.

Educational content: Sharing informative blog posts, videos and webinars that provide insights into medical supply trends and best practices.

Email campaigns: Regular newsletters and updates to keep customers informed about new products, promotions and industry news.

Startup costs and funding:

Inventory procurement: $100,000

Warehouse setup: $30,000

Website development and branding: $20,000

Initial marketing: $15,000

Operational expenses (1st Quarter): $25,000

Total startup costs: $190,000

Funding sources:

Personal savings: $60,000

Bank loan: $100,000

Investment from partners: $30,000

Total funding: $190,000

Revenue projections:

Year 1: $500,000

Year 2: $800,000

Year 3: $1,200,000

Operating expenses:

Rent and utilities: $2,500 per month

Employee salaries: $100,000 per year

Marketing and advertising: $20,000 per year

Inventory restocking: $150,000 per year

Insurance and compliance: $5,000 per year

Profit and loss projection:

Year 1 net profit: Variable based on revenue and expenses

Break-even analysis:

Fixed costs (annual): total fixed costs (rent, salaries, etc.)

Average revenue per month: estimate average monthly revenue

Break-even point: fixed costs / average revenue per month

Time frame for profitability: MediCare Supplies anticipates achieving profitability within the first year of operation by executing effective marketing strategies and catering to the growing demand for reliable medical supplies.

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• Sample Business Plans
• Medical & Health Care

Medical Equipment Business Plan

If you are planning to start a new manufacturing business, the first thing you will need is a business plan. Use our Lanzor – medical equipment manufacturing business plan example created using Upmetrics business plan software to start writing your business plan in no time.

Before you start writing your business plan for your new medical equipment manufacturing business, spend as much time as you can reading through some examples of manufacturing business plans.

Reading some sample business plans will give you a good idea of what you’re aiming for, and also it will show you the different sections that different entrepreneurs include and the language they use to write about themselves and their business plans.

We have created this medical equipment business plan example for you to get a good idea about how a perfect manufacturing business plan should look like and what details you will need to include in your stunning business plan.

Medical Equipment Business Plan Example Outline

This is the standard medical equipment manufacturing business plan outline which will cover all important sections that you should include in your business plan.

• Market and Opportunity
• Commercialized Products
• Products Under Development
• Competition
• Competitive Advantages
• Marketing and Distribution
• Frank Martin
• Evgeny Shaman
• Kimberly Patric
• Robert Stoddard
• Board of Directors
• Scientific Advisory Board and Clinical Investigators
• Professional Services
• Projected Revenue
• Projected Net Income
• Coronary Artery Disease (CAD)
• Diagnosing CAD
• Treating CAD
• Catheter-Based Procedures
• SmartFlowTM Console
• SmartFlow CFR/FFR Module
• SmartFlow Multiple lesionTM Module
• SmartFlow PTC Module
• SmartFlow@ Pressure Guide Wire (Consumable Product)
• SmartFlow Renal
• Myocardial Perfusion (Distal Vascular Bed)
• Product Acquisitions
• Intellectual Property
• Number of Cath Labs
• Number of Cam Procedures
• Spending on Oath Lab Equipment
• Patient Base
• Economic Impact
• Market Potential
• Interest in Physiologic Data
• Direct Competitors
• Indirect Competitors
• Summary of Competitive Advantages
• Pricing Strategy
• Sales and Marketing Strategy
• Sales Forecast
• Regulatory Approval
• Reimbursement
• Manufacturing and Distribution
• Market Risks
• Competitive Risks
• R&D Risks
• Legal Risks
• History and Structure
• Office Locations
• Evgeny Shalman
• Dov Gal, D.V.M.
• Gideon Tolkowsky
• Hillel Bachrach
• Shmuel Einav
• Takashi Akasaka
• Rafael Beyar
• Bernard De Bruyne
• Organization Chart
• Key Open Positions
• General Assumptions and Notes
• Revenue Assumptions
• Expense Assumptions
• Summary Income Statement($000)
• Capital Requirements a Use of Proceeds
• Exit Strategy

Say goodbye to boring templates

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Plans starting from $7/month

After getting started with Upmetrics , you can copy this medical equipment business plan example into your business plan and modify the required information and download your medical equipment business plan pdf and doc file. It’s the fastest and easiest way to start writing your business plan.

Download a sample medical equipment business plan

Need help writing your business plan from scratch? Here you go;  download our free medical equipment business plan pdf  to start.

It’s a modern business plan template specifically designed for your medical equipment business. Use the example business plan as a guide for writing your own.

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About the Author

Vinay Kevadiya

Vinay Kevadiya is the founder and CEO of Upmetrics, the #1 business planning software. His ultimate goal with Upmetrics is to revolutionize how entrepreneurs create, manage, and execute their business plans. He enjoys sharing his insights on business planning and other relevant topics through his articles and blog posts. Read more

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Medical Supply Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business ideas » Healthcare and Medical » Medical Supply

Are you about starting a medical supply company and need to write a plan? If YES, here is a detailed sample medical supply business plan template & FREE feasibility report.

If the idea of owning a medical related business sounds good to you, then this is indeed the time to start your own medical supply business, create financial freedom, and be your own master.

Any known medical practitioner needs specific supplies to do their duties and these equipment need to be manufactured and supplied by a firm.

Businesses that supply these equipment are growing on a daily basis. Below is a sample medical supply business plan template that will help you successfully write yours without much stress.

A Sample Medical Supply Business Plan Template

1. industry overview.

Players in the Medical supplies wholesaling industry purchase medical and surgical equipment, instruments and supplies, store these items at distribution centers, and deliver them to medical practitioners, clinics and hospitals.

A close study of the Medical Supplies Wholesaling industry reveals that revenue has increased steadily as the number of age-related non – elective procedures performed in the united states has increased. Rising product prices have also supported industry growth.

Revenue is projected to rise over the five years to 2022 as healthcare providers continue to invest in new equipment to keep up with growing demand for healthcare services. New product development by medical device manufacturers will also contribute to industry growth by offering new solutions to health issues.

The Medical Supplies Wholesaling industry is indeed a thriving in most countries of the world. In the United States of America, the industry generates over $194 billion annually from more than 13,223 medical supplies wholesaling companies.

The industry is responsible for the employment of over 218,294 people. Experts project that the industry will grow at a 1.9 percent annual rate between 2012 and 2017. The establishments in this industry that have dominant market shares in the United States of America are Cardinal Health Inc. and Owens & Minor Inc.

A recent report published by IBISWORLD shows that the barriers to entering the Medical Supplies Wholesaling industry are moderate. The importance of brand identity is minimal, because customers are concerned more with quality and price.

The low cost of customer switching will further ease the entry of new companies into the market. Switching costs are incidental and associated with changing transportation and communication systems.

Low switching costs encourage greater industry competition because new companies can more easily entice customers away from existing operators. The report also stated that, however, operators experience stringent regulatory controls and relatively high fixed costs , including warehousing technology, transportation equipment and complex machinery.

If you are contemplating starting your own medical supplies business in the United States, you should ensure that you carry out a thorough market survey and feasibility studies. If you get some key factors wrong before starting your any business, then you are likely going to struggle to stay afloat.

2. Executive Summary

Phil Jason® Medical Supplies, Inc. is a registered medical supplies wholesaling business that will be located in one of the busiest streets in Cape Coral – Florida. We settled for Cape Coral because it is one of the top 50 markets in the country for the coveted millennial renter.

An appreciable percentage of current tenants are millennials because of close proximity to employment, retail and recreation hubs.

We have been able to lease a facility that can fit into the kind of standard medical supplies wholesaling business that we intend launching and the facility is located in a corner piece property close to the largest commercial hub in Cape Coral – Florida.

Phil Jason® Medical Supplies, Inc. will supply a wide array of medical and surgical equipment, instruments and supplies from different manufacturers (brands) from the United States and abroad. We are set to services a wide range of clientele in and around Cape Coral – Florida.

We are aware that there are several medical supply wholesaling businesses all around Cape Coral – Florida, which is why we spent time and resources to conduct a thorough feasibility studies and market survey so as to be well positioned to compete with our competitors.

Phil Jason® Medical Supplies, Inc. will ensure that all our customers are given first class treatment whenever they do business with us. We have a CRM software that will enable us manage a one on one relationship with our customers no matter how large they grow to. We will ensure that we get our customers involved in the selection of brands that will be in our supply chain.

Phil Jason® Medical Supplies, Inc. will at all times demonstrate her commitment to sustainability, both individually and as a firm, by actively participating in our communities and integrating sustainable business practices wherever possible.

We will ensure that we hold ourselves accountable to the highest standards by meeting our customers’ needs precisely and completely whenever they patronize our products.

Phil Jason® Medical Supplies, Inc. is owned by Phil Jason and his immediate family members. Phil Jason has Degree in Pharmacy and an MBA, with over 15 years’ experience in the medical supplies industry, working for some of the leading brands in the United States.

Although the business is launching out by concentrating only in Cape Coral – Florida, but there is a plan to engage in supplies all around major cities in the United States.

3. Our Products and Services

Phil Jason® Medical Supplies, Inc. is in the medical supplies business to service a wide range of clients and of course to make profits, which is why we will make available a wide range of medical and surgical equipment, instruments and supplies from top manufacturing brands in the United States and other countries of the world.

Our product offerings are listed below;

• Nonelectronic medical, surgical, dental and veterinary instruments and apparatus, such as syringes, anesthesia apparatus, blood transfusion equipment, catheters, surgical clamps and medical thermometers, electromedical and electrotherapeutic apparatus, X-ray apparatus
• Surgical appliances
• Surgical instruments
• Hospital beds and other specialized hospital furniture
• Personal safety equipment

4. Our Mission and Vision Statement

• Our vision is to become one of the leading brands in the medical supplies line of business in Florida and to establish a one stop medical supplies wholesaling company in Cape Coral – Florida and other key cities in the United States of America.
• Our mission is to establish a world-class medical supplies wholesaling business that will make available a wide range of medical and surgical equipment from top manufacturing brands at affordable prices to businesses in and around Cape Coral – Florida and other key cities in the United States of America.

Our Business Structure

Our intention of starting a medical supplies wholesaling business is to build a standard company in Cape Coral – Florida. Although our company might not be as big as Cardinal Health Inc. and Owens & Minor Inc. et al, but will ensure that we put the right structures in place that will support the kind of growth that we have in mind while setting up the business.

We will ensure that we hire people that are qualified, honest, customer centric and are ready to work to help us build a prosperous business that will benefit all our stakeholders.

As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of ten years or more. In view of that, we have decided to hire qualified and competent hands to occupy the following positions;

• Chief Executive Officer (Owner)
• Store Manager
• Human Resources and Admin Manager

Merchandize Manager

Sales and Marketing Manager

• Accountants/Cashiers
• Sales Agents/Customer Services Executive

Truck and Van Drivers

5. Job Roles and Responsibilities

Chief Executive Officer – CEO:

• Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results
• Creating, communicating, and implementing the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
• Responsible for fixing prices and signing business deals
• Responsible for providing direction for the business
• Responsible for signing checks and documents on behalf of the company
• Evaluates the success of the organization
• Reports to the board

Admin and HR Manager

• Responsible for overseeing the smooth running of HR and administrative tasks for the organization
• Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
• Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
• Defining job positions for recruitment and managing interviewing process
• Carrying out induction for new team members
• Responsible for training, evaluation and assessment of employees
• Responsible for arranging travel, meetings and appointments
• Oversee the smooth running of the daily office activities.

Warehouse Manager:

• Responsible for managing the daily activities in the warehouse
• Ensures that proper records of medical and surgical equipment are kept and warehouse does not run out of products
• Ensure that the warehouse facility is in tip top shape and goods are properly arranged and easy to locate
• Control medical equipment and instrument distribution and supply chain inventory
• Supervise the workforce in the warehouse.
• Manage vendor relations, market visits, and the ongoing education and development of the organizations’ buying teams
• Help to ensure consistent quality of medical and surgical equipment from different manufacturers are purchased and retailed in good price
• Responsible for planning sales, monitoring inventory, selecting the merchandise, and writing and pricing orders to vendors
• Ensures that the organization operates within stipulated budget.
• Manage external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
• Model demographic information and analyze the volumes of transactional data generated by customer purchases
• Identify, prioritize, and reach out to new partners, and business opportunities et al
• Identifies development opportunities; follows up on development leads and contacts
• Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
• Document all customer contact and information
• Represent the company in strategic meetings
• Help increase sales and growth for the company

Accountant/Cashier:

• Responsible for preparing financial reports, budgets, and financial statements for the organization
• Provides managements with financial analyses, development budgets, and accounting reports
• Responsible for financial forecasting and risks analysis.
• Performs cash management, general ledger accounting, and financial reporting
• Responsible for developing and managing financial systems and policies
• Responsible for administering payrolls
• Ensuring compliance with taxation legislation
• Handles all financial transactions for the organization
• Serves as internal auditor for the organization

Client Service Executive

• Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
• Through interaction with customers on the phone, uses every opportunity to build client’s interest in the company’s products and services
• Consistently stays abreast of any new information on the organizations’ products, promotional campaigns etc. to ensure accurate and helpful information is supplied to customers when they make enquiries
• Find out the customer’s needs, recommend, select and help locate the right merchandise, describe a product’s features and benefits.
• Make suggestions and encourage purchase of products
• Provide information about warranties, manufacturing specifications, care and maintenance of merchandise and delivery options
• Assists in loading and unloading goods/medical supplies
• Maintains a logbook of their driving activities to ensure compliance with federal regulations governing the rest and work periods for operators.
• Keeps a record of vehicle inspections and make sure the truck is equipped with safety equipment, such as hazardous material placards.
• Assists the transport and logistics manager in planning their route according to a pick – up and delivery schedule.
• Inspects vehicles for mechanical items and safety issues and perform preventative maintenance
• Complies with truck driving rules and regulations (size, weight, route designations, parking, break periods etc.) as well as with company policies and procedures
• Reports defects, accidents or violations

6. SWOT Analysis

We are quite aware that there are several medical supplies wholesaling businesses all over Cape Coral and even in the same location where we intend locating ours, which is why we are following the due process of establishing a business.

We know that if proper SWOT analysis is conducted for our business, we will be able to position our business to maximize our strength, leverage on the opportunities that will be available to us, mitigate our risks and be equipped to confront our threats.

Phil Jason® Medical Supplies, Inc. employed the services of an expert HR and Business Analyst with bias in distribution to help us conduct a thorough SWOT analysis and to help us create a Business model that will help us achieve our business goals and objectives. This is the summary of the SWOT analysis that was conducted for Phil Jason® Medical Supplies, Inc.;

Our business is located in a city with heavy medical activities and also, we can boast of having good business relationship with top manufacturers in the medical and surgical equipment manufacturing industry in and around Cape Coral – Florida.

A major weakness that may count against us is the fact that we are a new medical supplies wholesaling business in Cape Coral – Florida and we don’t have the financial capacity to compete with multi – million dollars medical supplies wholesaling outlets like Cardinal Health Inc. and Owens & Minor Inc. when it comes to supplying at a rock bottom prices.

• Opportunities:

The fact that we are going to be operating our business close to the largest commercial hub in Cape Coral – Florida provides us with unlimited opportunities to sell our medical and surgical equipment to a large number of hospitals and other medical facilities.

We have been able to conduct thorough feasibility studies and market survey and we know what our potential clients will be looking for when they contact us; we are well positioned to take on the opportunities that will come our way.

A major threat that we are going to face as a medical supply business operating in the United States of America is uncertainty in government policies as it relates to price control and influx of medical and surgical equipment manufactured outside the United States of America.

When the prices charged by manufacturers to wholesalers’ declines, wholesalers typically have to reduce their selling prices to retailers. This results in subdued revenue growth for wholesalers, even if demand expands.

7. MARKET ANALYSIS

• Market Trends

If you are conversant with medical supply business, you will quite agree that most medical supply businesses usually locate their warehouse close to medical facilities; it enables them make quick sales.

So also, the need to meet up with international best practices and conforming with the regulatory authority will result in revenue growth, but profit margins will stagnate as medical supplies wholesaling businesses keep prices low to attract more sales amid growing competition.

A close watch on the medical supplies business activities reveals that the industry has indeed done pretty well due to the strong demand for latest and efficient medical and surgical equipment, instruments and supplies. As part of marketing strategies, medical supplies wholesaling companies engage in massive clearance sales to attract customers. It is a strategy that helps them welcome new customers and also reinforce the loyalty of old customers.

8. Our Target Market

We have positioned our medical supplies wholesaling business to service businesses in the healthcare industry in and around Cape Coral – Florida and every other location where franchise cum supplier will be located all over key cities in the United States of America and Canada.

We have conducted our market research and feasibility studies and we have ideas of what our target market would be expecting from us. We are in business to supply a wide range of medical and surgical equipment, instruments and supplies to the following customers;

• Medical laboratories
• Medical colleges
• Dental clinics
• Optical centers
• Medical and surgical equipment retailers

Our Competitive Advantage

A close study of the medical supplies wholesaling industry reveals that the market has become much more intensely competitive over the last decade. As a matter of fact, you have to be highly creative, customer centric and proactive if you must survive in this industry.

We are aware of the stiff competition and we are well prepared to compete favorably with other leading businesses in Cape Coral – Florida.

One thing is certain; we will ensure that we have a wide range of medical and surgical equipment, instruments and supplies from leading manufacturers available in our showroom and warehouse at all times. It will be difficult for customers to visit our showroom and warehouse and not see the type of equipment they are looking for.

Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category in the industry meaning that they will be more than willing to build the business with us and help deliver our set goals and objectives.

We will also give good working conditions and commissions to freelance sales agents that we will recruit from time to time.

9. SALES AND MARKETING STRATEGY

• Sources of Income

Phil Jason® Medical Supplies, Inc. is in business to retail a wide range of medical and surgical equipment, instruments and supplies in and around Cape Coral – Florida. We are in the industry to maximize profits and we are going to ensure that we achieve our business goals and objectives. Phil Jason® Medical Supplies, Inc. will generate income by supplying the following products;

10. Sales Forecast

One thing is certain when it comes to medical supplies wholesaling business, if your showroom and warehouse are stocked with various types of medical and surgical equipment and is centrally positioned, you will always attract customers cum sales.

We are well positioned to take on the available market in Cape Coral – Florida and we are quite optimistic that we will meet our set target of generating enough income/profits from our first six months of operation and grow the business and our clientele base.

We have been able to examine the medical supplies wholesaling industry, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below are the sales projections for Phil Jason® Medical Supplies, Inc. it is based on the location of our business and other factors as it relates to medical supplies wholesaling startups in the United States;

• First Fiscal Year (FY1): $450,000
• Second Fiscal Year (FY2): $950,000
• Third Fiscal Year (FY3): $1.850 Million

N.B : This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor retailing same services as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.

• Marketing Strategy and Sales Strategy

Before choosing a location for Phil Jason® Medical Supplies, Inc. we conducted a thorough market survey and feasibility studies in order for us to be able to penetrate the available market and become the preferred choice for hospitals and healthcare facilities in and around Cape Coral – Florida.

We have detailed information and data that we were able to utilize to structure our business to attract the number of customers we want to attract per time.

We hired experts who have good understanding of the medical supplies wholesaling industry to help us develop marketing strategies that will help us achieve our business goal of winning a larger percentage of the available market in Cape Coral – Florida.

In summary, Phil Jason® Medical Supplies, Inc. will adopt the following sales and marketing approach to win customers over;

• Introduce our medical supplies wholesaling by sending introductory letters alongside our brochure to hospitals, dental clinics, optical centers, medical laboratories, medical and surgical equipment retailers and key stakeholders in Cape Coral – Florida
• Ensure that we have a wide range of medical and surgical equipment, instruments and supplies from different brands at all times.
• Make use of attractive handbills to create awareness and also to give direction to our showroom
• Position our signage / flexi banners at strategic places around Cape Coral – Florida
• Create a loyalty plan that will enable us reward our regular customers
• List our business and products on yellow pages ads (local directories)
• Leverage on the internet to promote our business
• Engage in direct marketing and sales
• Encourage the use of Word of mouth marketing (referrals)
• Join local chambers of commerce and industries to network and market our products

11. Publicity and Advertising Strategy

Despite the fact that our medical supply showroom is well located, we will still go ahead to intensify publicity for the business.

Phil Jason® Medical Supplies, Inc. has a long-term plan of opening outlets in various locations all around Florida and key cities in the United States, which is why we will deliberately build our brand to be well accepted in Cape Coral before venturing out. Here are the platforms we intend leveraging on to promote and advertise Phil Jason® Medical Supplies, Inc.;

• Place adverts on community based newspapers, radio and TV stations.
• Encourage the use of word of mouth publicity from our loyal customers
• Leverage on the internet and social media platforms like; YouTube, Instagram, Facebook, Twitter, LinkedIn, Snapchat, Google+ and other platforms to promote our business.
• Ensure that our we position our banners and billboards in strategic positions all around Cape Coral – Florida
• Distribute our fliers and handbills in target areas in and around our neighborhood
• Contact hospitals, dental clinics, optical center, medical laboratories and other health facilities by calling them up and informing them of Phil Jason® Medical Supplies, Inc. and the products we sell
• Advertise our medical supplies wholesaling business in our official website and employ strategies that will help us pull traffic to the site
• Brand all our official cars and distribution vans and ensure that all our staff members and management staff wear our branded shirt or cap at regular intervals.

12. Our Pricing Strategy

Aside from quality, pricing is one of the key factors that gives leverage to a medical supplies wholesaling business, which is why big players like Cardinal Health Inc. and Owens & Minor Inc. and co will attract loads of clients.

We know we don’t have the capacity to compete with market leaders in the industry, but we will ensure that the prices and quality of all the medical and surgical instruments and supplies that are available in our supply chain are competitive with what is obtainable in the industry.

• Payment Options

The payment policy adopted by Phil Jason® Medical Supplies, Inc. is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America. Here are the payment options that Phil Jason® Medical Supplies, Inc. will make available to her clients;

• Payment via bank transfer
• Payment via credit cards / Point of Sale Machines (POS Machines)
• Payment via online bank transfer
• Payment via check
• Payment via mobile money transfer
• Payment via bank draft

In view of the above, we have chosen banking platforms that will enable our clients make payment for their purchases without any stress on their part.

13. Startup Expenditure (Budget)

From our market survey and feasibility studies, we have come up with a detailed budget for establishing a standard medical supplies business and here are the key areas where we will spend our start-up capital;

• The total fee for registering the business in the United States of America – $750.
• Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $3,300.
• Marketing promotion expenses for the grand opening of Phil Jason® Medical Supplies, Inc. in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
• The cost for hiring business consultant – $2,500.
• Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $2,400.
• The cost for payment of rent for 12 months at $1.76 per square feet in the total amount of $105,600.
• The cost for warehouse remodeling (construction of racks and shelves) – $20,000.
• Other start-up expenses including stationery ($500) and phone and utility deposits ($2,500).
• Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $60,000
• The cost for start-up inventory (stocking with a wide range of medical and surgical equipment, instruments and supplies from different manufacturing brands) – $550,000
• The cost for the purchase of distribution trucks – $29,500
• The cost for store equipment (cash register, security, ventilation, signage) – $13,750
• The cost of purchase and installation of CCTVs: $10,000
• The cost for the purchase of office furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al): $4,000.
• The cost of launching a website: $600
• Miscellaneous: $10,000

We would need an estimate of $750,000 to successfully set up our medical supplies wholesaling business in Cape Coral – Florida.

Generating Funds/Startup Capital for Phil Jason® Medical Supplies, Inc.

Phil Jason® Medical Supplies, Inc. is a private registered business that is solely owned and financed by Phil Jason and his immediate family members. They do not intend to welcome any external business partner which is why he has decided to restrict the sourcing of the startup capital to 3 major sources.

• Generate part of the startup capital from personal savings
• Source for soft loans from family members and friends
• Apply for loan from the bank

N.B: We have been able to generate about $250,000 ( Personal savings $200,000 and soft loan from family members $50,000 ) and we are at the final stages of obtaining a loan facility of $500,000 from our bank. All the papers and documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.

14. Sustainability and Expansion Strategy

Part of the plans we have in place to sustain Phil Jason® Medical Supplies, Inc. is to ensure that we continue to make available a wide range of medical and surgical equipment, deliver quality services, and improvise on how to do things faster and cheaper. We are not going to relent in providing a conducive environment for our workers.

We are quite aware that our customers are key component to the growth and survival of our business hence we are going to continuously engage them to give us ideas on how to serve them better and the products they want to see in our supply chain. We will not waste time in adopting new technology, best practices and diversifying our services.

Phil Jason® Medical Supplies, Inc. will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.

As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of three years or more. We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.

Check List/Milestone

• Business Registration: Completed
• Opening of Corporate Bank Accounts: Completed
• Securing Point of Sales (POS) Machines: Completed
• Opening Mobile Money Accounts: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Application for business license and permit: Completed
• Purchase of Insurance for the Business: Completed
• Leasing of facility and remodeling the shop: In Progress
• Conducting Feasibility Studies: Completed
• Generating capital from family members: Completed
• Applications for Loan from the bank: In Progress
• Writing of Business Plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents and other relevant Legal Documents: In Progress
• Design of The Company’s Logo: Completed
• Printing of Promotional Materials: In Progress
• Recruitment of employees: In Progress
• Purchase of the needed furniture, racks, shelves, computers, electronic appliances, office appliances and CCTV: In progress
• Creating Official Website for the Company: In Progress
• Creating Awareness for the business both online and around the community: In Progress
• Health and Safety and Fire Safety Arrangement (License): Secured
• Compilation of our list of products that will be available in our supply chain: Completed
• Purchase of supply trucks and vans: Completed .
• Establishing business relationship with vendors – manufacturers and suppliers of medical and surgical equipment, instruments and supplies : In Progress

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Out of the Centre

Savvino-storozhevsky monastery and museum.

Zvenigorod's most famous sight is the Savvino-Storozhevsky Monastery, which was founded in 1398 by the monk Savva from the Troitse-Sergieva Lavra, at the invitation and with the support of Prince Yury Dmitrievich of Zvenigorod. Savva was later canonised as St Sabbas (Savva) of Storozhev. The monastery late flourished under the reign of Tsar Alexis, who chose the monastery as his family church and often went on pilgrimage there and made lots of donations to it. Most of the monastery’s buildings date from this time. The monastery is heavily fortified with thick walls and six towers, the most impressive of which is the Krasny Tower which also serves as the eastern entrance. The monastery was closed in 1918 and only reopened in 1995. In 1998 Patriarch Alexius II took part in a service to return the relics of St Sabbas to the monastery. Today the monastery has the status of a stauropegic monastery, which is second in status to a lavra. In addition to being a working monastery, it also holds the Zvenigorod Historical, Architectural and Art Museum.

Belfry and Neighbouring Churches

Located near the main entrance is the monastery's belfry which is perhaps the calling card of the monastery due to its uniqueness. It was built in the 1650s and the St Sergius of Radonezh’s Church was opened on the middle tier in the mid-17th century, although it was originally dedicated to the Trinity. The belfry's 35-tonne Great Bladgovestny Bell fell in 1941 and was only restored and returned in 2003. Attached to the belfry is a large refectory and the Transfiguration Church, both of which were built on the orders of Tsar Alexis in the 1650s.  

To the left of the belfry is another, smaller, refectory which is attached to the Trinity Gate-Church, which was also constructed in the 1650s on the orders of Tsar Alexis who made it his own family church. The church is elaborately decorated with colourful trims and underneath the archway is a beautiful 19th century fresco.

Nativity of Virgin Mary Cathedral

The Nativity of Virgin Mary Cathedral is the oldest building in the monastery and among the oldest buildings in the Moscow Region. It was built between 1404 and 1405 during the lifetime of St Sabbas and using the funds of Prince Yury of Zvenigorod. The white-stone cathedral is a standard four-pillar design with a single golden dome. After the death of St Sabbas he was interred in the cathedral and a new altar dedicated to him was added.

Under the reign of Tsar Alexis the cathedral was decorated with frescoes by Stepan Ryazanets, some of which remain today. Tsar Alexis also presented the cathedral with a five-tier iconostasis, the top row of icons have been preserved.

Tsaritsa's Chambers

The Nativity of Virgin Mary Cathedral is located between the Tsaritsa's Chambers of the left and the Palace of Tsar Alexis on the right. The Tsaritsa's Chambers were built in the mid-17th century for the wife of Tsar Alexey - Tsaritsa Maria Ilinichna Miloskavskaya. The design of the building is influenced by the ancient Russian architectural style. Is prettier than the Tsar's chambers opposite, being red in colour with elaborately decorated window frames and entrance.

At present the Tsaritsa's Chambers houses the Zvenigorod Historical, Architectural and Art Museum. Among its displays is an accurate recreation of the interior of a noble lady's chambers including furniture, decorations and a decorated tiled oven, and an exhibition on the history of Zvenigorod and the monastery.

Palace of Tsar Alexis

The Palace of Tsar Alexis was built in the 1650s and is now one of the best surviving examples of non-religious architecture of that era. It was built especially for Tsar Alexis who often visited the monastery on religious pilgrimages. Its most striking feature is its pretty row of nine chimney spouts which resemble towers.

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Eye Surgery Equipment Maker Business Plan

Start your own eye surgery equipment maker business plan

Executive Summary executive summary is a brief introduction to your business plan. It describes your business, the problem that it solves, your target market, and financial highlights.">

This business plan has been developed to present NovOculi, Inc. to prospective investors and to assist in raising equity capital needed to begin production and to continue research and development of its patented products.

The Company NovOculi, Inc. is a start-up company that has designed and plans to develop and market ophthalmological surgical tools and techniques. During the past two years, NovOculi’s principals have had extensive experience with refractive correction techniques (both laser and non-laser based). Building on this experience, the principals have developed and begun testing a unique method of incisionless refractive correction dubbed NICS (Non-Invasive Corneal Sculpting).

Current refractive techniques, including LASIK, PRK, and Intacs, all require destruction of at least a portion of the protective epithelial layer overlying the cornea of the eye and are accompanied by complications resulting from this loss of protection. The principals have developed a method involving iontophoresis, an ionic dye and a wavelength-specific laser to accomplish effective refraction without the troublesome destruction of epithelium.

Using NICS, NovOculi plans to take advantage of the opportunities for market development and penetration in the field of laser refraction in which demand is nearly doubling each year.

Based on the detailed financial projections prepared by the company’s management, it is estimated that equity investment is required to begin the company’s operations successfully. Funds will be used to produce, test and market NICS, as well as provide initial working capital for the first two years.

Market Potential A massive potential market base exists for the laser refractive surgery industry. It is estimated that approximately 54% of the U.S. population (~162 million) has refractive errors, approximately 90% of which are eligible for correction using current techniques or those on the near horizon (Federal Air Surgeon’s Medical Bulletin). In contrast, only 900,000 Americans have had LASIK (the most popular laser correction technique) as of two years ago. This represents only 0.6% of the total current market, leaving the other 99.4% untapped. (“Bye-Bye Glasses,” EyeCare Business Online ). Furthermore, the demand for laser refractive surgery is approximately doubling annually (“Bye-Bye Glasses,” EyeCare Business Online ,).

The company has contacted nine of the leading ophthalmological medical institutions in the U.S. Seven of the nine have expressed interest in participating in collaborative research and, given encouraging research results, performing NICS commercially once it is available. Institutions expressing interest include: John Hopkins, Harvard, Stanford, Oregon Health Sciences, Duke University, and the University of California at San Francisco.

NovOculi’s principals have also conducted a preliminary market survey at a local grocery market in the Durham, NC area. Fifty consumers with refractive errors were randomly selected outside of a local grocery market and asked the questions in the survey. A copy of the survey and a summary of its findings may be found in the Market Survey topic.

Technology The principals have developed and patented a revolutionary technique, NICS, and two novel devices which are used to accomplish incisionless refractive correction. The patented technique involves driving an ionic dye from its patented polymeric vehicle into the cornea of the patient using the patented iontophoretic device (a device that creates a charge which then repels or attracts other charges). Once the ionic dye has been effectively driven into the cornea and away from sensitive structures, a laser tuned to the wavelength of the dye is then used to target the dyed cornea and alter its shape, much as is done with current laser refraction protocols. After the procedure is completed, the iontophoretic device is reapplied, this time with opposite polarity, and the dye is drawn from the cornea due to the attraction of opposite charges. Through the use of the patented device and technique, the ophthalmologist performing the procedure will be able to avoid the most troublesome and complication-ridden aspect of current laser refraction surgery: the corneal incision. Over 90% of all complications of current laser refraction surgery are related to difficulties associated with the incision and the subsequent healing process, virtually all of which could be avoided with NovOculi’s technology.

Strategy The key element in NovOculi’s strategy is to market its technology to both those performing the procedure as well as to those on which the procedure will be performed. Once research data and publicity have been generated, the sales force will step in to encourage the initial investment in the laser and equipment required for the procedure, creating a “demand push.”  After this investment has been made, a “demand pull” will be generated for the components required for institutions to perform the procedure through marketing directly to patients.

The sales team will begin with six seasoned sales personnel and swell to forty-four members by Year 5. The sales team will work closely with laser manufacturers in order to promote the technology to patients and surgeons.

Ophthalmologist training for the NICS procedure will be available at six sites throughout the U.S.: San Francisco, Boston, Atlanta, Philadelphia, Kansas City, and Durham, NC. Each site will have in-depth training sessions led by a prominent ophthalmic surgeon.

Those performing the procedure will be able to charge a premium for providing patients with access to this superior technology. NovOculi will extract approximately half of the nearly $1,000 premium through licensing fees associated with its patented procedure and sales of the individual components.

Regulatory Issues As with its predecessor, LASIK, the company’s product will not need to wait for FDA approval prior to widespread use. LASIK had been performed on almost 900,000 patients without approval by the FDA as of two years ago (Current Trends in Refractive Eye Surgery, 128th Annual Meeting of APHA).

This was made possible due to the fact that the “FDA does not approve procedures, only the equipment used in them” (“Eye centers set their sights on LASIK surgery growth,” Houston Business Journal , July 16) and the components of the procedure have already been approved by the FDA for medical use. NovOculi will not need to obtain approval to market their patented technique and devices due to the fact that the FDA has approved similar devices for medical use in the following arenas:  1) The 440 nm laser has been approved for dermatologic uses. 2) Iontophoretic devices has been approved for drug delivery on the epidermis. 3) Polymeric contact lenses have been approved and are commonly used as an external aid for refractive correction, and 4) The targeting dye, tartrazine, is the most ubiquitous food coloring additive on the market to date.

Major Milestones The following are key milestones for the startup period:

• Completion of strategic business plan nine months before starting date.
• Research grants applied for by seven months before starting date.
• All patents, domestic and foreign, applied for by six months before starting date.
• Start-up capital raised by starting date.
• All other first-year milestones are currently on schedule in accordance to the business plan.

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The principals, to date, have spent ample time on development and research of the current products which will satisfy the market demand for a safer, less complicated laser refraction correction technique.

Financial Summary Based on detailed financial projections, if the company receives its funding, it will operate profitably by Year 4 with a hefty net profit. The following chart summarizes the projected financial information.

1.1 Mission

To provide the field of ophthalmology with innovative designs which will facilitate the treatment of ophthalmologic diseases and conditions.

Company Summary company overview ) is an overview of the most important points about your company—your history, management team, location, mission statement and legal structure.">

NovOculi, Inc. will research and develop biomedical devices to aid in the treatment of a variety of ophthalmologic diseases and conditions. Initially, its customers will be those individuals that desire permanent refractive correction but do not wish to risk the multitude of complications associated with the current procedure, LASIK.

The company is currently developing its patent-applied technology to final product and approval stage. It is also seeking to establish its corporate identity in the medical products field.

2.1 Company Ownership

The company will be incorporated in North Carolina. It will have authorized 15 million ordinary shares and 150,000 preferred shares. The rights and privileges of these shares will be stated in the company’s Articles of Incorporation.

The proposed share capital of the company prior to capital raising

The company has raised seed capital from its principals.

Additional working capital will be raised in two sections. Section 1 will be conducted in January of Year 1 and will raise money for use in accordance with the business plan. Section 2 will raise additional funds in Year 3 of the business plan, but will be conducted only if sufficient research grants are not obtained in Year 2. It is deemed likely by the company’s industry consultants that the research grants will be obtained and, therefore, section 2 will not be necessary.

2.2 Start-up Summary

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

• Formulation of the strategic business plan.
• The establishment of a corporate identity.
• The establishment of a location and place of doing business.
• Funding of working capital requirements, purchases of other equipment and assets deemed necessary for the principle operating activities of the company, and additional capital raising alternatives.
• Initiation of Research and Development of existing and future products.

Costs of raising capital through private placement.

Startup seed funding was raised from the founders of the company for these purposes. This funding will be available in late 2001 and these tasks have either been completed successfully or are in the final process of completion.

These are treated purely as start-up expenses and initial working capital by this plan. The founders’ investment is treated as cash-on-hand as of the start of this plan on January 1, 2002. The remainder of the start-up capital required, as well as capital required, for the continuation of operations in the first six months will be provided by selling shares via a private placement to key investors. The capital obtained through this fund-raising exercise is expected to provide an additional boost and the business plan calls for these funds to be infused for the purposes of operating the business, in accordance with this business plan.

2.3 Company Locations and Facilities

The company will initially be based in the Research Triangle Park area in North Carolina. The website (www.NovOculi.com) has already been registered, and the trademark process has been initiated.

In view of the strategic plan to contract with a third party for all manufacturing requirements, the facilities needed will be mainly offices for personnel and storage space for inventory. After Year 5, when the market for our products reaches our anticipated milestone, the company will explore the feasibility of constructing its own manufacturing facilities.

Ophthalmologist training for the NICS procedure will be available at six collaborative research centers in the following cities: San Francisco, Boston, Atlanta, Philadelphia, Kansas City and Durham, NC. Each site will be coordinated by, but financially independent of, NovOculi and will have in-depth training sessions led by a prominent ophthalmic surgeon.

Initial research and development (R&D) will be accomplished through a collaborative effort with the Stanford University Department of Ophthalmology, who provides NovOculi’s initial research facilities.

NovOculi’s technology is an improvement on the common laser refractive surgery procedure LASIK. In order to fully explain NovOculi’s technology, it is first necessary to develop an understanding of its predecessors in the laser refractive surgery industry. After this has been accomplished, NovOculi’s technology will be described, competing technologies will be analyzed, sourcing issues will be addressed and, finally, future products will be discussed.

Background Refractive correction, in all forms, is accomplished through alteration of the contours of the cornea. This alteration is accomplished by destroying either the stroma (middle layer of the cornea) or the epithelium (outer, protective layer of the cornea) of the cornea, and in some cases, both.

Early procedures, such as PRK, used lasers to change the contour of the cornea by destroying both the epithelium and the stroma through simply blasting the cornea straight on without any preparation. This procedure was difficult for patients as the healing took weeks and the destruction of the epithelium left the eye permanently susceptible to infections and ulcers.

LASIK was an improvement over PRK due to the fact that most of the protective layer of epithelium was folded back, and only the stroma of the cornea was destroyed. In order to fold the epithelium back, though, a large, circular incision in the cornea was necessary. While LASIK was an advance in technology in that the epithelium was not destroyed, the incision itself was found to cause multiple problems such as night blindness, loss of sight, permanent sensation of irritation, etc.

3.1 Product Description

In an effort to avoid the complications associated with corneal incision and epithelial destruction utilized in laser refractive surgery procedures, NovOculi’s principals designed NICS (Non-Invasive Corneal Sculpting). NICS allows for effective laser refractive correction without the troublesome corneal incision. The subject matter of NovOculi’s technology is currently protected by Provisional Patent No. 60/243,031.

The ionic dye used in NICS is tartrazine, a common food coloring additive. Tartrazine is a small, stable, yellow dye which absorbs visible light at 440 nanometer (nm) and is positively charged. In order to make sure that the tartrazine is delivered only to the cornea, NovOculi has developed a unique contact lens impregnated with tartrazine which incorporates a barrier to lateral diffusion. This barrier prevents the remainder of the eye from being exposed to the tartrazine and allows for more precise dye delivery.

By controlling the duration of the iontophoresis, during which the RPID will be positively charged to repel the tartrazine, the dye is selectively placed in the middle of the cornea, away from the sensitive epithelial and endothelial layers. Once this has been accomplished, the middle layer of the cornea can be selectively targeted by a 440 nm wavelength laser without ever having to destroy any portion of the protective epithelium.

After the cornea has been sculpted with the laser, the RPID is then reapplied with reversed polarity and the dye is extracted from the cornea, leaving a clear, sculpted cornea.

In summary, NICS is performed as follows:

• Drops are applied to the epithelium of the cornea to decrease sensation and increase dye permeability.
• A contact lens of varying polymeric density and charged with ionic dye, tartrazine, is placed on the epithelium of the cornea of the eye to be corrected, then the RPID (charge-inducing plate) in the shape of a contact lens is placed over the dye.
• The RPID is activated with a charge similar to the dye, thereby forcing the dye into the eye.
• The cornea is washed free of the dye and the iontophoretic plate is reapplied to drive the dye beyond the epithelial layer of the cornea, but above the endothelial layer.
• Once the dye is selectively located in the stromal layer of the cornea, a laser tuned to the wavelength of the dye, 440 nm, is used to sculpt the cornea using the standard laser refractive surgery protocol.
• The reversible iontophoretic device is then reapplied with its charge reversed in order to draw the dye out of the cornea due to their now opposite charges attracting.
• The eye heals and the stroma resorbs over the course of one to two weeks during which sight improves to 20/20 (or better!).

NovOculi’s novel technology is found in 1) The overall method of selectively ablating stromal corneal cells, 2) The Reversible Polarity Iontophoretic Device, and 3) The dye-impregnated polymeric contact lens, all of which are currently intellectual property of Daniel R. Burnett, one of the principals.

While NovOculi’s technology is novel, the principles on which it is founded are well established. The targeted destruction of certain cells through delivery, then stimulation, of a photoactive substance has been accomplished elsewhere in the human body in the treatment of cancer and has been termed Photodynamic Therapy (“Targeted intracellular delivery of photosensitizers to enhance photodynamic efficiency,” Immunology & Cell Biology , August 2000). Also, the delivery of ionic substances into the eye has been successfully accomplished in studies attempting to increase the ocular delivery of dilating drops and antibiotics (“The role of iontophoresis in ocular drug delivery,” Journal of Ocular Pharmacology , Spring 1994). Thus, the principles on which NovOculi’s technology rests have been proven in related studies, yet never applied in the laser refractive surgery until now, with the development of NovOculi’s patented method and devices.

3.2 Sourcing

Most of the components involved in NovOculi’s method of corneal sculpting are relatively inexpensive and common. The iontophoretic plate, for example, is constructed of standard electronic components and its power source can be either an outlet or a common battery. Tartrazine, the ionic dye, is the most common food coloring additive used in the United States, making this component ubiquitous.

The one component which will be more expensive and difficult to obtain will be the refractive laser tuned to the wavelength of the ionic dye. Partnership with a laser manufacturer would be beneficial in facilitating the development of this laser and well-received efforts have been made to form this relationship.

3.3 Future Products

Future products of NovOculi, Inc. will be medical devices in the field of ophthalmology. Two of the principals, Dr. Daniel Burnett and Dr. Terry Kim, as well as one of the consultants, Dr. Mark Blumenkranz, are intimately involved in the field of ophthalmology and have experience in the R&D of biomedical devices.

In order to capitalize on NovOculi’s core competency in ophthalmic devices, the company will focus its efforts in this arena. One example of a device currently in the R&D pipeline is a contact lens formed from a calcium alginate polymer impregnated with one of a variety of ophthalmically active drugs. Use of this slow-release, once-a-day therapy will allow many patients to be treated much more effectively and more conveniently than the current therapy which requires repetitive application of eye drops, sometimes as often as once an hour.

Market Analysis Summary how to do a market analysis for your business plan.">

The market for NovOculi’s products currently consists of patients with refractive errors who desire to have sharper vision without external aids. Essentially, the potential market is the nearly identical to the potential market for LASIK, the current laser refractive surgery procedure. The markets are not exactly identical, though, as we expect there to be greater acceptance of a non-invasive refractive protocol versus the complication-ridden LASIK.

A massive potential market base exists for the laser refractive surgery industry. It is estimated that approximately 54% of the U.S. population (~162 million) has refractive errors, approximately 90% of which are eligible for correction using current techniques or those on the near horizon (Federal Air Surgeon’s Medical Bulletin, Winter 1998). Furthermore, the demand for laser refractive surgery is approximately doubling annually.

The company has contacted 9 of the leading ophthalmological medical institutions in the U.S., 7 of which have expressed interest in participating in collaborative research and, given encouraging research results, performing NICS once it is available. Institutions expressing interest include: John Hopkins, Harvard, Stanford, Oregon Health Sciences, Duke University, as well as the University of California at San Francisco.

Furthermore, NovOculi has conducted a preliminary market survey at a local grocery market in the Durham, NC area. Fifty patients chosen at random outside of the grocery market, all with refractive errors, completed the survey, a copy of which may be found in the Market Survey topic. The following sections refer to this market study in further expounding on the tremendous market potential for NovOculi.

4.1 Market Survey

The following survey was given to 107 consumers at a local grocery store in Durham, N.C. on January 12th and 13th:

• Do you now have, or have you ever had, a refractive error (Vision that is worse than 20/20).
• Have you considered, or would you ever consider, permanent correction of your vision.
• If so, would you be willing to pay more money for the surgery in order to decrease the rate of significant complications (pain, night blindness, etc.) by 50%?
• If so, how much would you pay?

A)   less than $500 B)   $500-1,000 C)   $1,000-2,000 D)   more than $2000 Brought to you by Create a professional business plan Using AI and step-by-step instructions Create Your Plan Secure funding Validate ideas Build a strategy

Once 50 participants answered “Yes” to questions number 1 and 2, the survey was terminated and the following results compiled:

Of those that would pay the premium in order to decrease the rate of complications, the following distribution was found:

The data clearly indicate that, of those consumers in this sample population with refractive errors who would consider surgery for permanent correction, an overwhelming majority would pay a premium for a decreased risk of significant complications. Of the premiums that would be paid, the most common value was $500-$1,000 with a mean dollar value of approximately $1,100 (using midpoints and assuming midpoint for more than $2,000 is $2,500).

4.2 Target Market Segment Strategy

NovOculi will focus its marketing strategies on building market share among the outcome-conscious refractive surgery patients. For this customer segment, NovOculi will offer a branded technology which will help the patient to gain increased visual acuity with less of a risk of complications. The market research shows that this customer segment is less price sensitive and will absorb price premiums charged by ophthalmologists that use the NovOculi technology.

4.2.1 Market Needs

The market needs of the target segment are straightforward – clients want to permanently improve their vision using a process with the lowest possible risk of complications. Good vision is of paramount importance for such patients as it allows them not only to be independent of visual aids but also to become healthier in general. There will be no need to buy new frames or to rinse contacts, and such patients will literary open up their eyes to the world.

4.3 Market Segmentation

Patients desiring permanent refractive correction typically fall into two different groups with respect to their predominant concerns related to the procedure: Outcome-Conscious Patients and Cost-Conscious Patients. Outcome-Conscious Patients constitute the bulk of the refractive surgery market (46 out of 50 surveyed), and were willing to pay a premium in order to achieve a significant decrease in the rate of complications (defined as 50% less) with the procedure. The Cost-Conscious Patients typically felt that the decrease in rate of complications was not worth the extra expenditure.

Outcome-Conscious Patients The bulk of the population, these patients seek out the highest quality procedure with the most skilled surgeon, typically regardless of price. Most patients realize the importance of their vision and will not take chances with respect to their sight. This group will be the primary target for NovOculi as they will tolerate NovOculi’s charging a premium for its superior procedure.

Cost-Conscious Patients The small minority of the refractive error patient population, these patients will often fly to Canada or Mexico in order to capitalize on the large price differential with respect to the laser vision correction procedure between these countries and the United States. These patients will not be targeted by NovOculi initially as they are less interested in the superiority of technology and the skill of the surgeon as they are in the cost of the procedure.

4.4 Industry Analysis

Currently the industry is experiencing rapidly increasing competition in the form of price wars. The average consumer now pays approximately $1,650 per eye for LASIK, as opposed to greater than $2,500 per eye less than two years ago (“Laser Eye Centers Wage an All-Out Price War,” New York Times , December 9, 2000). With this price crunch, the valuation of existing companies has plummeted despite their continued growth in earnings.

Insurance companies are beginning to experiment with reimbursement for LASIK as well. Currently, though, the only insurance companies that pay for LASIK at all do so with a subsidy, which is a small discount to keep patients within their health system.

NovOculi will be affected by the current industry trends, but to a much lesser degree than LASIK providers. Due to the superiority of NovOculi’s technology over LASIK, NovOculi will be able to charge a premium. Also, due to its proprietary position, NovOculi is in a position to prevent the commoditization of NICS and thereby sustain economic profits for the duration of NovOculi’s patent.

4.4.1 Industry Participants

Currently, the major industry participants listed in “Laser Eye Centers Wage an All-Out Price War,” New York Times , from December 9, 2000 are as  follows:

• Hospitals- 10%
• Corporate Chains- 48%
• Independent Ophthalmologists- 42%

The major corporate chain participants will be outlined in detail in the next section, Competition.

4.4.2 Distribution Patterns

Currently, the distribution pattern for the industry involves high-end sales with excellent manufacturer support. The lasers cost millions of dollars and are large investments for the purchasing institutions. No distributor is necessary for these lasers as the internal sales staff and distribution mechanisms suffice.

The microkeratomes involved in LASIK are also sold directly from the manufacturer to the LASIK provider. With the microkeratomes, though, the small, tightly knit medical device distribution channels are beginning to play a role. For NovOculi, these medical device distributors will play a key role due to the fact that components of the NovOculi procedure are single-use and will require frequent purchasing and delivery.

4.4.3 Competition and Buying Patterns

As was alluded to in the previous section, the current buying patterns for the LASIK procedure involve substantial, infrequent purchases with excellent manufacturer support. The only significant purchases necessary in order to perform LASIK are the laser and the microkeratome, both of which are long-term, multiple-use devices. This buying pattern is related to the fact that none of the components of the LASIK procedure are single-use. These buying patterns are expected to change once NovOculi begins to capture market share and the need for replenishment of its single-use, dye-impregnated contact lens increases. NovOculi will need to develop strategic relationships with existing distributors in order to take advantage of their well-established distribution infrastructure.

Competition

Competition in the field of refractive correction, both permanent and temporary, has been escalating. Not only are glasses, contact lenses, PRK, LASIK, Intacs, and others competing with each other, but competitive forces within these arenas is becoming fierce as well. LASIK providers, for example, are experiencing vicious price wars which are cutting deeply into profit margins.

NovOculi will rely on the superiority of its technology in order to thrive in this competitive market. NovOculi’s is still the only technology in the field of refractive surgery which provides permanent refractive correction without making any complication-ridden incisions into the cornea. This competitive advantage will help NovOculi navigate these competitive waters and capture a large portion of the refractive surgery market.

5.1 Competitive Technology

Competition in the refractive surgery arena is expected from three main sources: external aids, existing laser refractive surgery, and alternative non-laser surgical procedures.

External Aids Contact lenses and glasses have been around for decades. The fact that LASIK has become so wildly popular, with demand doubling annually despite its complications, displays the fact that many patients who were once content with external aids now desire permanent refractive correction.

Existing Laser Refractive Surgery It is expected that the largest source of competition will be from the LASIK industry. Much like LASIK has ousted the previously accepted procedure of PRK, NovOculi hopes to supplant LASIK with NICS. The competition NovOculi’s technology faces is significant as many institutions have already purchased the excimer lasers required for LASIK, a hefty investment which will create lock-in to the LASIK procedure. Once the details of the superiority of NovOculi’s procedure surface, laser refractive surgery centers will be pressured to invest in NICS by both ophthalmologists performing the procedure and patients desiring refractive surgery.

Another competing technology worth mention is the newly-developed technique employing femtolasers. This technology also hoped to correct refractive errors without an epithelial incision by using multiple lasers focused on a single position at which their destructive effects would be additive. Recent studies have found multiple, unavoidable technical complications, including formation of gas, debris, and cauterized tissue at the site of cellular destruction. It is highly unlikely that this technology will be able to overcome these hurdles and accomplish incisionless refraction without the use of some form of dye or chemical to target the selected tissues, a method which is the currently intellectual property of NovOculi.

Alternative Non-laser Surgical Procedures In the U.S., the most popular, non-laser surgical technique in the industry is Intacs. Intacs are implanted into the stroma of the cornea where they bend the overall curvature to the desired angle so that the refractive error is corrected indefinitely, but reversibly.This procedure, as well as fully implantable contact lenses, have the added benefit of being reversible, but the disadvantage of still requiring a significant incision in the cornea with disruption of the stroma. Also, the procedure can only be performed on those with mild near-sightedness, approximately 20% of the existing market. Despite these disadvantages, these alternatives are gaining a niche in the market and will be a source of competition.

5.2 Competitive Comparison

Technology-wise, NICS has significant advantages over existing technologies. As was explained previously, current procedures all require destruction of a portion of the epithelium of the cornea. This destruction places the eye in danger of multiple complications, the overall rate of which is approximately 10%. The following are the most common complications associated with the epithelial incision in LASIK.

Common – (greater than 5% of the patient population)

• Pain (possibly chronic)
• Photophobia
• Induced Irregular Astigmatism (corneal flap wrinkling)
• Corneal Scarring (associated with continued glare and haloes and permanent loss of night vision
• Epithelial Ingrowth (extension of scarring in cornea)
• Damage to Iris
• Tearing/Excess Mucous- Dry Eye
• Corneal Edema

Less Common – (less than 5% of the patient population)

• Corneal Epithelial Flap Dislocation
• Corneal Rupture
• Complete Blindness

Virtually all of these complications are associated with the corneal epithelial incision and its subsequent post-operative healing. Due to this fact, the bulk of these complications could be effectively avoided through the use of NICS.

5.3 Main Competitors

NovOculi’s competitors can be divided into two categories: those competing within the field of laser refractive surgery and those with alternate refractive correction technology.

Laser Refractive Surgery Competitors Competition will arise from both LASIK laser manufacturers and LASIK providers. Among these competitors, though, lies the possibility for the formation of strong, strategic alliances in both arenas.

LASIK Laser Manufacturers The largest of the LASIK laser manufacturers is VISX (EYE). Down from its peak valuation of $100/share in July of 1999, VISX now trades at $13, with a market cap of $800 million and a  price/earnings (p/e) ratio of 23. VISX is a good candidate for a potential ally in the development of a laser for NICS.

LASIK Providers One of the largest commercial chains providing LASIK is TLC Laser Eye Centers (TLCV). Since its peak of $50 a share in July 1999, TLC has also experienced large devaluations associated with the increasingly competitive price wars in the LASIK industry. Due to these price cuts, TLC has experienced a negative 100% income growth. The fact that TLC has rapidly eroding margins associated with massive devaluations makes TLC an ideal target for a strategic alliance as well so that they may once again reap the rewards of a large sustainable profit margin. Currently, the stock trades at approximately $4, with a market cap of $129 million.

Non-Laser Refractive Correction Competitors The greatest competition in this field is expected to arise from Intacs, the reversible corneal implants for refractive correction from KeraVision, Inc (KERA). Founded in 1986, KeraVision received 510K approval for its instruments in mid-1999. After meeting this milestone, KeraVision’s stock peaked at nearly $30 in July of 1999. Subsequently, as demand for laser refractive correction rose, KeraVision’s stock plummeted despite positive research results in human trials.

Currently with a stock price of $0.47, KeraVision’s most recent return on equity of -97.50% is below its five-year average of -60.90%, which is also below the five-year industry average of 11.50%. Also, NASDAQ has threatened to delist the company and proceedings are underway. It is the opinion of experts in the biotechnology industry that KeraVision will not be able to weather its current financial hardships and will soon file for bankruptcy.

5.4 Impact of Competition

NovOculi’s competition will have both a negative and a positive impact on the company’s success.

Negative Impact The competing technologies outlined in section 5.1 all hold a significant portion of the current refractive correction market. Furthermore, especially with LASIK, the institutions performing these procedures have invested large sums in order to acquire the technology in order to perform these procedures. This is expected to create an element of lock-in in which many institutions performing LASIK will be reluctant to switch to NICS. For this reason, it is imperative that NovOculi accelerate its bench research and market entry of NICS as much as possible.

Also, competitors in this field have been engaging in a vicious price war. While NovOculi expects to be able to charge a premium, this premium is still based on the existing laser surgery price as a foundation. Further erosion of prices will have a negative impact on NovOculi as well.

Positive Impact With the acceptance of each of these technologies, the potential diffusion rate of NICS grows. Competitors have already invested millions of dollars in convincing patients that they need refractive surgery, and further convincing many to have the procedure performed. As with any new technology, the acceptance of the pioneer is always slower than modifications of the pioneering technology. Therefore, market acceptance of NICS will be speeded by existing technology.

5.5 Competitive Edge

As was mentioned previously, NovOculi’s system of refractive correction has significant advantages over existing technologies. Current procedures all require destruction of a portion of the epithelium of the cornea which places the eye in danger of multiple complications, the overall rate of which is approximately 10%. NovOculi’s technology obviates the need for such an incision and will make the procedure safer and more attractive to patients with refractive errors.

NovOculi’s competitive advantage arises from its proprietary position with a patent on the reversible iontophoretic plate for delivery of the dye to the cornea, the method of sculpting the cornea using a targeting chemical and an energy source which will selectively stimulate the chemical, and the varying density polymeric contact lens impregnated with an ionic dye.

Strategy and Implementation Summary

The key element in NovOculi’s strategy is to market its technology to both those performing the procedure as well as to those on which the procedure will be performed. Once research data and publicity have been generated, the sales force will step in to encourage the initial investment in the laser required for the procedure, creating a “demand push.” After this investment has been made, a “demand pull” will be generated for the components required for institutions to perform the procedure.

Ophthalmologist training for the NICS procedure will be available at six sites throughout the U.S.: San Francisco, Boston, Atlanta, Philadelphia, Kansas City and Durham, NC. Each site will have in-depth training sessions led by a prominent ophthalmic surgeon.

6.1 Value Proposition

The true value proposition for NovOculi’s technology lies with the patient. The patient stands to gain permanently increased visual acuity with a greatly decreased risk of complications. As vision is of paramount importance for the general patient population, they will be willing to pay a hefty premium in order to access the superior technology.

The value proposition for institutions and ophthalmologists to adopt the technology is two-fold: 1) Economic profit will be able to be sustained as NovOculi intends to charge approximately 50% of the total price increase associated with NovOculi’s procedure, and 2) Use of this procedure will constitute superior patient care for those providers to whom this matters.

6.2 Marketing Strategy

Promotion of NovOculi’s technology will involve targeting two different populations: 1) Ophthalmologists Performing Laser Refractive Surgery and 2) Patients with Refractive Errors. NovOculi’s success is dependent upon acceptance of its technology by both groups and its promotional strategies will be reflective of this fact. Of course, acceptance by either group will be helpful in obtaining acceptance by the other.

6.2.1 Promotion Strategy

NovOculi’s technology will be marketed using different tactics to target its two different target populations: 1) Ophthalmologists Performing Laser Refractive Surgery and 2) Patients with Refractive Errors.

Ophthalmologists Performing Laser Refractive Surgery Acceptance amongst the nearly 3,400, and growing, ophthalmologists who perform refractive surgery will be one of the keys to NovOculi’s success. Even with strong patient demand, if the ophthalmologists are not willing to perform the procedure, then the market will remain untapped. Furthermore, ophthalmologists frequently have a privileged position in consulting patients concerning procedures and those that have embraced NovOculi’s technology will be powerful advocates.

In marketing the procedure to ophthalmologists, the main consideration will be the effectiveness of the procedure and its superiority over existing technology. The most important factor in promoting NovOculi’s technology will be concrete research results displaying its superiority over existing technologies. Once these studies have been completed, three main channels will need to be utilized to target ophthalmologists: 1) Publication in highly visible and reputable medical journals, 2) Advertising in these same medical journals, and 3) Presentations at national conventions. Using these channels, along with the free publicity associated with the introduction of a novel, superior technology, ophthalmologists performing refractive procedures will be effectively targeted and a demand “push” will be generated for patients to choose NovOculi’s procedure over existing options.

Patients with Refractive Errors As with the ophthalmologist population, the most important factor in promoting NovOculi’s technology to the patient population will be concrete research results displaying its superiority over existing technologies. Once this has been established, NovOculi will embark on a large-scale, national advertising campaign focusing on television and printed media. Using these channels, along with as much free press as possible, NovOculi will be able to create a demand “pull” for its technology to complement the demand “push” which will arise from acceptance amongst ophthalmologists.

6.2.2 Pricing Strategy

As was mentioned in the topic on Market Segmentation, NovOculi will target the Outcome-Conscious Patient population and will not concern itself with the Cost-Conscious Patient population. In analyzing the results of the market survey, it was found that the Outcome-Conscious Patient population constituted 90% of the market. Also, this patient population was found to be much more price inelastic, willing, on average, to pay $500-$1,000 more for a procedure with significantly less complications.

NovOculi intends to charge a total of $200 per eye licensing fee for use of NovOculi’s patented procedure, then another $40 for each dye impregnated lens. Not including the reversible inotophoretic plate, NovOculi will charge approximately $480 per patient, assuming that both eyes will be corrected. Assuming that the ophthalmologists will be able to charge $1,000 more than the average current charge for LASIK, as was indicated in the survey results, this will leave over $500 per patient as the incentive for the ophthalmologists and institutions to make the investment and adopt NovOculi’s technology.

Considering that the average price for the LASIK procedure is currently $3,300 for both eyes (“Laser Eye Centers Wage an All-Out Price War,” New York Times , December 9, 2000), the price for NovOculi’s procedure is expected to be approximately $4,300 for both eyes. This is still well under the upper end of current prices for LASIK surgery which totals $6,000 for both eyes (“Laser Eye Centers Wage an All-Out Price War,” New York Times , December 9, 2000). Institutions using NovOculi’s technology will be able to charge this amount, even in the current increasingly price-competitive environment, due to the superiority of NovOculi’s technology.

The iontophoretic device will be a high margin, low volume item as this component of NICS will not need to be purchased with each additional procedure. Due to this fact, the iontophoretic device will be priced at $3,500.

6.3 Sales Strategy

NovOculi’s sales strategy will tie in with the sales strategy of the laser manufacturer. The key step in sales will be to initiate the investment in NovOculi’s technology by purchasing the laser to be used in the procedure. As with LASIK, the laser is a major investment, and the combined efforts of both NovOculi’s and the laser manufacturer’s sales forces will be required to encourage the initial investment. Once this investment has been made, the sales effort required from NovOculi will be decreased as the institutions performing the procedures will require the additional components sold by NovOculi in order to perform the refractive surgery. Therefore, the sales force will be relied on heavily for the initial demand push for the laser, then to a much lesser extent for the additional components for the procedure.

NovOculi’s sales force will initially consist of 6 sales personnel in Year 2. This number is expected to swell to 44 by Year 5 with expected dramatic increases in sales.

6.3.1 Sales Forecast

NovOculi’s technology is an improvement over LASIK, much the same as LASIK was an improvement over PRK. In fact, a poll of 10 Duke University and Stanford University ophthalmologists revealed that, on average, they felt that NovOculi’s technology was an improvement over LASIK of the same magnitude and caliber as LASIK was over PRK. Using this fact along with historical LASIK diffusion data (“Expanding the Horizons of Surgical Correction,” Review of Optometry , May, 1998) and the assumption that the diffusion constants will be similar between the two technologies, the following sales forecasts were compiled.

These forecasts do not take into account the fact that the market has become more receptive to ophthalmic laser surgery with the successes of LASIK and PRK and that the diffusion rate would probably be accelerated due to this increased acceptance of precedent technologies.

In developing the Sales Forecasts, it was modestly assumed that only 1/3 of all patients will require refractive correction bilaterally (both eyes). Current available data indicate that the actual fraction of patients requiring bilateral correction is closer to 2/3.

6.4 Strategic Alliances

NovOculi will initially try to encourage strategic alliances in three different arenas: laser manufacturers, refractive surgery providers, and research institutions.

Laser Manufacturers As NovOculi will provide all the components necessary to perform its patented procedure except for the laser, developing a strategic alliance with a laser manufacturer will be an important step. Existing laser manufacturers, including VISX and Alcon, are currently being approached as a prelude to this partnership.

Refractive Surgery Providers Possibilities for strategic alliances abound in the current refractive surgery industry. Due to the increasingly fierce competition, LASIK providers are expected to be very receptive to a strategic alliance that would allow them access to a proprietary technology with which they could charge a sustainable premium. As was noted in section 4.2.1, 48% of all LASIK surgery is being done by corporate chains. A large corporate chain would be an ideal initial strategic alliance as it would provide excellent exposure and access to its well-established patient base and distribution networks.

Research Institutions As the bulk of research on the procedure has already been arranged to be done in collaboration with Stanford University, this strategic alliance is already well-formed. NovOculi is open to further collaboration as well, and expects to utilize five additional institutions as NICS training sites, including research institutions in: Boston, Atlanta, Philadelphia, Kansas City, and Durham, NC.

6.5 Milestones

The following are the key milestones for the first year of operations:

• Completion of strategic business plan by March 1, 2001.
• Research Grants will be applied for by May 1, 2001.
• All patents, domestic and foreign, will be applied for by July 1, 2001.
• Animal trials initiated by October 1, 2001.
• Start-up capital will be raised by January 1, 2002.
• All other first year milestones are currently on schedule in accordance to the business plan.

Regulatory Issues

Since the “FDA does not approve procedures, only the equipment used in them” (“Eye centers set their sights on LASIK surgery growth,” Houston Business Journal , July 16, 1999)  and the components of the procedure have already been approved for FDA use, NovOculi’s products will be ready for the market as soon as medical research shows favorable results. The FDA has already approved the use of the 440 nm laser in the medical arena for dermatologic uses, and NovOculi will not need to obtain approval to use this device in the sculpting of the cornea. Similarly, iontophoretic devices, polymeric contact lenses and the targeting dye, tartrazine, have been approved by the FDA for human use and will require no additional approval at this juncture.

An example of such expedited market entrance can be seen with the laser vision correction procedure LASIK. Prior to its approval by the FDA in Winter of 1999, LASIK had been performed on 900,000 patients due to the fact that the laser used for LASIK, the excimer laser, had already been approved for medical use in PRK. (“Bye-Bye Glasses,” EyeCare Business Online , September 2000)  We hope to similarly expedite market entrance.

Management Summary management summary will include information about who's on your team and why they're the right people for the job, as well as your future hiring plans.">

NovOculi’s Management Team is undoubtedly one of its strengths. Among its five principals, NovOculi, Inc. boasts three MBAs, a Chemistry PhD, and two MDs in the field of ophthalmology, all with stellar records within their fields. NovOculi’s consultants are impressive as well, with consultation being provided by the highly successful entrepreneur and technology development expert, Jim Sheldon, the highly reputable and internationally known chairman of Stanford ophthalmology, Dr. Mark Blumenkranz, and an Intellectual Property guru, Trygve Laegrid.

8.1 Management Team

Principals :

Daniel Burnett : Currently an MD/MBA student at Duke University applying for a residency in ophthalmology, Mr. Burnett has a long history of biomedical device design and testing and has spent a total of 10 months at the Food and Drug Administration (FDA). In addition to currently pursuing an MD/MBA, Mr. Burnett also has invented a myringotomy tube insertion device (patent pending) and has created a magnetic nerve stimulation device (patent pending). 

Terry Kim, MD : An ophthalmologist at the Duke University Eye Center, Dr. Kim has been performing LASIK laser surgery vision correction for the last five years. Dr. Kim has been profiled on the Discovery channel and has performed LASIK surgery on many high-profile figures, such as NBA-bound players on the Duke men’s basketball team.

Joseph Walker : A current MBA candidate at the Fuqua School of Business, Mr. Walker has detailed knowledge of the venture capital and start-up process derived from his experience at The Aurora Funds, Inc., a southeastern venture capital firm. Mr. Walker plans to pursue a career in venture capital and entrepreneurship.

Andy Rubinson : Currently attending MIT Sloan, in the New Product and Venture Development Track, Mr. Rubinson spent six years working for the Department of Defense at Boeing Space Systems where he helped improve product design and development and manufacturing processes for Delta Rockets and the International Space Station. He then spent two years assigned to Andersen Consulting’s (now Accenture) High Tech and Electronics Market Unit during which time he obtained experience in Product and Processes Development, Integrated Materials and Manufacturing, Procurement, and Manufacturing Strategy and Operations.

Joseph Hewitt : Currently pursuing a PhD in Chemistry at Duke University, Mr. Hewitt has research/teaching experience in both UV/Vis and Fluorescence spectroscopy. His dissertation research involves the application of Capillary Electrophoresis and Fluorescence Lifetime spectroscopy to characterize and study a class of environmental molecules called Humic Substances. As part of this research he has had extensive experience with both lasers and fluorescent dyes, making him a valuable addition to the management team.

Consultants :

James E. Sheldon : Mr. Sheldon’s background includes over twenty-five years experience in business, law, and education. For twelve years, he was one of two principals in The Synertech Group, Inc., a North Carolina-based venture development firm. Two public companies, Embrex and EnSys, resulted from Synertech’s efforts. Prior to founding Synertech, Mr. Sheldon was a principal in, or consultant to, several high technology start-up companies in the Research Triangle area.

Mark Blumenkranz, MD : Dr. Blumenkranz is Professor and Chairman of the Department of Ophthalmology at Stanford University. Dr. Blumenkranz is the author of more than 100 peer-reviewed publications and book chapters and was instrumental in developing the successful laser vision correction program at Stanford. He currently serves as a principal investigator on a number of clinical research trials at Stanford evaluating the effects of laser and pharmacologic agents on eye disease. Dr. Blumenkranz is an associate examiner for the American Board of Ophthalmology and a member of the Retina, Vitreous, Macula, and Gonin Societies. He has served on the Editorial Board of the journals Retina, Graefe’s Archives for Ophthalmology, and Ophthalmology. He is a past recipient of the Research to prevent Blindness Special Manpower Award, the Heed Award, the Rosenthal Award in Visual Sciences, and the American Academy of Ophthalmology Senior Honor Award.

Trygve Laegrid, PhD : Dr. Laegrid is currently pursuing an Executive MBA at the MIT Sloan School of Management. After obtaining a PhD in condensed matter physics, Dr. Laegrid became involved in licensing, valuation and management of intellectual property. He is currently the Manager for Intellectual Property and Commercialization for Statoil Industrial Development.

8.2 Management Team Gaps

An experienced CEO is actively being sought. The founders of the company will conduct the search. The desired profile is for a CEO experienced in the medical device arena, ideally who was part of a previous successful start-up venture.

The company will search for design engineers and consultants.

8.3 Personnel Plan

The Personnel Plan chronicles the growth of the organization to approximately 77 employees in the first 5 years. Each year may require a few additional people besides those indicated, based on the growth of the company in accordance with the Business Plan.

Financial Plan investor-ready personnel plan .">

CAPITAL RAISING (THE OFFER) The company intends to raise an amount of seed capital. Startup investment has already been committed by management.

Current Capital Structure:

Current Shareholders:

For $1.5 million, the investing party will receive 1,500,000 preferred shares or 33.3% of the company. Preferred shares will include senior debt and anti-dilution provisions as negotiated.

The proceeds from the offer will be used to fund the working capital requirements of the Company (and its subsidiary and associated companies, if any).

Land building, plant and machinery, and other fixed assets will be purchased as and when deemed necessary to maximize the profits of the company.

Cashflows incidental to the normal business operations of the company.

Funds will be used for the purpose of business operations of the company.

Exit Considerations The most likely exit afforded investors will be through acquisition. If the company’s actual operational and financial results are in any reasonable range of the projected results herein, the company will become an attractive asset to an acquisitive competitor or larger medical device company. No particular competitor or medical device company is thought to be more likely than another to be interested in NovOculi’s technology.

To the extent that actual operational results materially exceed those projected herein, the probability of an IPO exit increases. Exceptional results would enhance the NovOculi’s brand name and financial position, making new product development and the likelihood of new product success more plausible. In this scenario, the opportunity to raise capital and provide an investment exit to shareholders becomes more likely.

A third exit possibility for investors may be an acquisition after IPO. This strategy would allow an investor to delay exit until after capital from an IPO is invested in successful projects, further raising the value of the firm.

9.1 Important Assumptions

• Growth of NICS will parallel that of LASIK.
• Expansion into foreign markets will not occur in this 5-year plan.
• Projections related to consumer acceptance were estimated using market survey.
• Total market size was based on only 1/3 of all patients having both eyes corrected (current data supports as much as 2/3).
• Research Grant of $2 million applied for in May of 2001 will be received by December 2002.
• Stanford University backing of research proposal and offering of facilities will decrease total research and design expenditures by 50%.

Sales/Revenues

• Projections were based on continued rejection by insurance companies to reimburse for refractive correction.
• Acceptable premiums were developed using preliminary market survey of n=50.

9.2 Break-even Analysis

With a fully operational average monthly fixed cost, NovOculi will break-even once the sales volume as shown in the table below is reached. Per-unit revenue and costs for the Iontophoretic Device, Licensing Fees, and the Polymeric Vehicle have been averaged. The management estimates that the company will reach this sales volume by the third year of operations, at which time the per-unit direct costs and direct costs of sales will begin decreasing.

9.3 Projected Profit and Loss

The Projected Profit and Loss table takes into account the significant subsidization of NovOculi’s research efforts by the Stanford University Department of Ophthalmology. Due to this strategic alliance, the company’s research expenditures have been nearly halved.

9.4 Projected Cash Flow

Important points to note in Projected Cash Flow are as follows:

• In Year 1 of the business plan, the company expects to raise (Section 1) working capital.
• While the company has planned for additional capital raising (Section 2) in Year 3 of the business plan, it is expected that research grants will have been secured by this point and capital raising will not be necessary.

9.5 Projected Balance Sheet

While Inventory on the Balance Sheet may appear disproportionately low in comparison to sales, this is due to the fact that one of the components of total sales, licensing fees, is not a durable good and will require no inventory.

9.6 Business Ratios

The following table presents important ratios from the Opthalmic goods industry, as determined by the Standard Industry Classification (SIC) Index code 3851.

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