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Techfilt Spain Hydrating the Future

Techfilt Spain Hydrating the Future. Equipo Reto Instituto de Empresa Tesia Hostetler  Chris Kozup Martin Paley  Sami Shiro. 90% of globally available freshwater will be in use by 2030. Only 50% of the Spanish population has access to modern sewerage treatment.

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Techfilt Spain Hydrating the Future

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  1. Techfilt SpainHydrating the Future Equipo RetoInstituto de EmpresaTesia Hostetler Chris Kozup Martin Paley Sami Shiro

  2. 90% of globally available freshwater will be in use by 2030

  3. Only 50% of the Spanish population has access to modern sewerage treatment

  4. Only 59% of Spain's wastewater conforms to EU regulations

  5. UltraFiltrationMembranes AdvancedTechnology Filt Tech

  6. The Hard Truth… Water pollution in Spain has reached critical levels

  7. The Hard Truth… Water shortage wreaking havoc on agriculture and industry

  8. The Hard Truth… 5th May 2005 News Coverage

  9. Who is Techfilt? • Techfilt is a leading supplier of filtration technologies and services • Singapore headquarters • Techfilt will establish a subsidiary in Barcelona, Spain • Initially targeting wastewater treatment

  10. The Path Ahead Issue 1: Wastewater must be cleaned Issue 2: What solution can clean it? Issue 3: Why can Techfilt provide it? Issue 4: How does Techfilt succeed?

  11. Need for Clean Water • Spain’s chronic water crisis • Frequent droughts • Subsidies cause wasteful consumption • Water system over burdened • Outdated water facilities • 10% population growth since 1995 • Tourism hotspots – seasonal overloads • Need for water treatment and reuse • Recycled water ideal for major water uses such as agriculture

  12. Need for Clean Water • Inadequate treatment facilities (41%) • EU directive 91-271-EEC compliance by 2006 • Imposes treatment standards • Towns of 2000+ people must comply • Spain’s “Programa A.G.U.A.” • Municipalities must react to improve water quality Wastewater Regulation Compliance

  13. The Path Ahead Issue 1: Wastewater must be cleaned Issue 2: What solution can clean it? Issue 3: Why can Techfilt provide it? Issue 4: How does Techfilt succeed?

  14. Market Discontinuity! Treatment Solutions Stagnation Pond Membrane Filtration

  15. Treatment Solutions Legacy • Outdated technology • Low water quality • Not scalable • Water released to environment • Limited compliance to EU directives • Difficult to expand Filtration • Emerging technology • High quality output • Scalable system • Release to fresh water reservoirs • Surpass compliance requirements • Can integrate into existing facilities • Minimal cost difference between the two technologies!

  16. The Path Ahead Issue 1: Wastewater must be cleaned Issue 2: What solution can clean it? Issue 3: Why can Techfilt provide it? Issue 4: How does Techfilt succeed?

  17. Why Techfilt? World-classR&D Experts in our Field End to EndExpertise Leading EdgeProducts InternationalExperience

  18. Techfilt’s customer focus directs engineering and product innovation Competitive advantage through mutually beneficial long-term relationships Why Techfilt? • Operating Water Companies control water supply • Turn-key contractors design, build, and implement • Techfilt partners with contractors and operating water companies Source: Techfilt Spain

  19. How Techfilt reaches its customers and builds long-term relationships Why Techfilt? • Aguas de Barcelona • Contract consultants to gain credibility • Network to expand industry contacts • Hire local sales expertise • Conduct promotional activities with the contractors and water operators • Social: Bullfights, Football Games • Industry: Seminars, Workshops

  20. The Path Ahead Issue 1: Wastewater must be cleaned Issue 2: What solution can clean it? Issue 3: Why can Techfilt provide it? Issue 4: How does Techfilt succeed?

  21. Build market awareness and brand recognition How to Succeed? • Educate water companies and government officials • Seminars on filter technology and regulation • Active in trade associations • Partner with environmental groups • Sponsor conferences, encourage lobbying activities

  22. Strategies for customer acquisition How to Succeed? • Key customer reference • Establish credibility and gain market acceptance • “Water Treatment-in-a-Box” • End to end plant design showcasing Techfilt filtration technology • RFP optimization • Assist turn-key contractor in bid process with design ideas and price optimization

  23. Becoming a long-term solution provider How to Succeed? • Compliance Guarantee • Offer customers 15 year regulatory compliance guarantee • Superior filtration technology ensures long-term solution • Evolve with the customer • Knowledge transfer of global best practices • Monitoring technology • Interpret regulatory compliance

  24. Bringing established operational excellence to the Spanish subsidiary How to Succeed? • Team – combination of local talent and imported expertise • Postponement of final assembly to local fabricator • Import proprietary filters • outsource supply of non-critical components

  25. Initial investment of S$2.04M • Break-even point in late 2009 • Net Present Value of S$4.05M • Average revenue growth of 48%, operating margin of 15.5% How to Succeed? Financial Metrics for Success

  26. Competitive Threats Threat Response Gain access to existing industry networks via Aguas de Barcelona and local sales EstablishedRelationships Focus on supply chain management Low Complexity Supply Chain Deliberate focus on wastewater treatment products Broad ProductOfferings

  27. A Risk Analysis Risk Response Spanish staff trained in Singapore; Singapore staff given cultural training CulturalDifferences • Supply chain quality control PhysicalDistances Expansion into other product lines: desalination; industrial applications Limited Adoption Shift sales focus to maintenance and repair revenues Reach EUCompliance

  28. Growth Strategy Phase 1 Establish market presence Phase 2 Product Diversification Phase 3 Geographic Expansion • Build on Key Customer reference to obtain 30 projects within Spain • Reverse Osmosis Systems • Ultrafiltration Membranes • Eastern European countries • Mediterranean countries

  29. We are Equipo RetoInstituto de EmpresaThank You! Questions?

  30. Backup Slide Index Backup Slides

  31. Market Size • Number of plants needed • Currently 1200 compliant plants • Estimated total need is 2030 plants • Demand is projected to grow with increased population and climatic pressures • Projected demand for filters • Average price of €300,000 for filters per plant • Total market opportunity approx. €250M

  32. Market Analysis • Increasing government spending towards compliance • Spent €12M in 1991 on a national plan for water treatment • Over 40% of polluted water is not properly treated • Increasing environmental awareness • Environmental agencies are increasing pressure for a solution

  33. Launch Strategy • Entry strategy: Initial focus on wastewater treatment • Products: submerged membranes and membranes bioreactors • Expand through other markets (consumer or industrial treatment) • Products: ultrafiltration membranes and reverse osmosis systems

  34. Operating Water Companies Filtration Technology Manufacturers Independent Environmental Consultants Turn-Key Contractors Customer Taxonomy • Filtration Manufacturers • Turn-key contractors • Water Operating Co’s • Independent Consultants • European Regulatory Bodies European Union Water Treatment Regulations

  35. Customer Buying Process

  36. Building credibility and establishing relationships with the turn-key Contractors Marketing - Phase 1 • RFP Optimization • Lowest cost • Templates • Knowledge transfer • Clarity of design • “Water Treatment In-a-Box” • Broad framework • Allows for quick development of treatment plant • Shows Techfilt’s expertise • Future Compliance Guarantee • Enduring relationship • Promise compliance • Knowledge resource

  37. Marketing - Phase 2 Build awareness of the benefits of membrane filtration among operating water companies • Educational Seminars • Build awareness of water crisis • Explain the EU regulations • Show benefit of filtration technologies • Techfilt DIRECT • Monthly newsletter • Distributed to all industry players • Non-sales • Builds credibility • Creates awareness

  38. Marketing - Phase 3 Spur action in government for water treatmentCreate political pressure for quality water treatment • Lobbying • Working with enviornmental agencies to pressure political action • Helps force compliance • Conferences • Sponsor events on water management • Increase dialog on the problem in hopes of finding a resolution • Grassroots Networking • Become involved in political activism • Sponsor awareness creating events (e.g. rallies)

  39. Why Buy from Us? • Leverage Aguas de Barcelona to build relationships with government and contractors • Secure a flagship customer; use reference to build credibility and win contracts • Help contractors win RFP bids by improving their RFP bidding process • Offer design concepts such as the “Wastewater Treatment in-a-Box” framework • Build trust with 15 year compliance guarantee • Educate environmental agencies on Filtration

  40. Competitors

  41. Supply Chain

  42. Personnel • Department Recruitment Policy- Intelligence & Concientiousness • Critical Interface with Customers • Flagship References • Techfilt Expert • Knowledge of HQ Culture • Spaniard • Extensive industry relationships

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