Business Model
Our business model (outside the United States and Canada where all of the
stores are company-owned) has been through distributorship arrangements under
which we license our trademark. All of our distributors have created flagship
stand-alone stores in upscale malls or on street level, which have proven to be
a very successful means of building our brand and generating sales. These
stores carry our entire product line, provide a level of service by trained
skincare consultants that is not generally available in department stores and
provide an interactive, fun shopping experience where the customer can touch,
smell and sample our products before purchasing.
Our concept is unique since our focus is on selling health and beauty products
in a boutique setting with a particular niche in a broad range of sophisticated
skincare products. We also manufacture and sell a substantial line of other
products that cater to the body from head to toe, including spa, bath and body,
hair care and fragrances. We also carry accessory products that are branded
under our trademark.
All of our distributors have had prior retail experience and have the financial
resources to build flagship stores and actively promote the brand through
advertising, media events and other promotional activities. They have a keen
awareness and sensitivity on how and where to position our brand among the
competition within their respective territory. In some countries, our
distributors also engage in distribution by store-in-stores within a department
store setting. We receive inquiries on a daily basis from countries around the
world, but are very selective on who represents the ~H2O+ brand in
each country. We grant exclusive rights to a distributor to promote our brand
in a particular country and at the same time, we require that the distributor
not market or represent any other skincare/bath and body/cosmetic lines.
Our existing distributors have experienced tremendous success in the Far East,
the Middle East, South America, and Australia and are continuing to expand
their operations with additional outlets. In the U.S. and Canada, H2O
Plus also continues to expand its chain of Company-owned stores in key urban
environments.
The Eleven Point Plan
H2O Plus is a fully integrated company with product research,
development, and manufacturing all done in our facilities in downtown Chicago
where we also warehouse and manage distribution of the resulting product. We
also own retail locations in upscale markets in the U.S. and Canada. Overseas
we have entered into distributor relationships where our distributors build
stores and engage in wholesale distribution under trademark license and
distribution agreements. We provide substantial support to our international
partners in terms of store location/site evaluation, store layout,
merchandising, marketing, employee training on product and sales techniques,
and store operations.
Our strategy is very clear; we look for a distributor who has the retail
experience and financial means to open several stand-alone stores in an
exclusive territory as specified in the Distributorship Agreement with H2O
Plus. While wholesale distribution is desirable, we view any wholesale activity
as coming after the establishment of the ~H2O+ brand through one or
more Flagship Stores.
It is important to note that our distributors are selected for their exclusive
representation of ~H2O+ products with an express understanding that
they will not sell or represent any other cosmetic, fragrance, or skincare
line. We believe development of the ~H2O+ brand is a full-time
endeavor and in exchange for our granting exclusivity rights and substantial
support, we expect full-time efforts to be devoted to our brand. This business
model has proven quite successful as demonstrated by our tremendous growth in
the international markets. We receive interest in our concept on a daily basis
from all parts of the world, and we are therefore, pleased to note a universal
recognition of our brand.
As is true with beginning any new venture, a plan is essential to a successful
start-up. One has to know where they are, where they want to be, and how they
will get there. With these things in mind, the elements of the plan that we
look for from a prospective Distributor will include the following information:
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Overall assessment of the local cosmetic/skincare market with an analysis of
the competition.
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How you would position the ~H2O+ brand vis-a-vis competitors.
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Customer profile (demographics on who would be our target customer).
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Short and long term plans for potential locations for stand-alone stores, and
the availability of such locations. Please specify lead-time to open stores.
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Evaluation of the retail and wholesale distribution opportunities in the
cosmetics market, general economic conditions, consumer shopping patterns, etc.
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Marketing strategy to develop the brand.
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Public relations / advertising campaign / store launch plans.
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Detail on retail and business backgrounds of the individuals that will support
the H2O Plus concept.
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Annual sales targets for the next five (5) years.
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Annual product purchases from H2O Plus for the next five (5)
years.
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Credit references, including bank contact information, and any financials
evidencing sufficient resources to develop the ~H2O+ brand in the
particular territory.
Most prospective Distributors for H2O Plus have a "connection" with
our brand. They have used our product, or visited one or more of our stores, or
visited our manufacturing facility in downtown Chicago. At least one of these
"connections" is the best starting point for plan development.
If you have any questions regarding the required business plan please contact:
International Business Development Department
Fax: 312-491-3201
Email: custsvc@h2oplus.com
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