Jenna SavilleY.N.O.T.

324 Pine StreetWichita, Kansas 67203

(316) 420-7698

Sarah JohnstonKansas Credit Union & Trust Company616 State StreetWichita, Kansas 67200

March 12, 2006Re: Financing Request

Dear Ms. Johnston:

Thank you for your interest in seeing the plan for my business, which will provide non-medical homecare for the elderly. I think we are a good fit with the credit union’s stated mission to encourage Kansas entrepreneurs to create local businesses that are not only profitable but also help society.

I have raised $15,000 in start-up capital for my business, Y.N.O.T., and am seeking a 10-year loan for an additional $10,000. The company name, Y.N.O.T., is an acronym for “Your Needs, Our Tasks. “ Our mission is to provide affordable non-medical homecare services that support independence, by providing assistance to elderly and homebound individuals.

In Kansas there are currently 359,000 individuals age 65 and older, and in the year 2030 that number is expected to reach 605,000. Social changes in family size, and the number of women in the workforce, have affected the ability of informal caregivers to provide care for their elderly family members. Therefore, Y.N.O.T. is available when these informal caregivers cannot be.

Our competitors include home health care providers and independent providers. Unlike home health care providers, Y.N.O.T.’s services will not require a doctor’s prescription. Unlike independent providers, Y.N.O.T. will focus not on one or two specific services, but on a broad range of services. Y.N.O.T. will have a competitive edge in the areas of heavy housekeeping, education, and entertainment services. We do not require a minimum number of hours of service for each visit, which allows our services to remain affordable for the client who requires only one or two hours of service per visit. We also have the flexibility to meet the changing needs of the client, whereas a franchise organization is often unable to do so.

My business plan is attached. If you have any questions, please contact me at (316) 420-7698.

Sincerely,

Jenna Savile

Inside: Executive SummaryBusiness Description

Management and EmployeesOperations and Suppliers

Marketing PlanCompetition

Financing RequestBusiness Financial StatementsPersonal Financial Statement

Financial RatiosBreak-Even Analysis

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Exit StrategyAppendix: Services Offered

CONTENTS

1. Executive Summary

2. Business Description

3. Management and Employees

4. Operations and Suppliers

5. Marketing Plan

6. Competition

7. Financing Request

8. Business Financial Statements

9. Personal Financial Statement

10. Financial Ratios

11. Break-Even Analysis

12. Exit Strategy

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EXECUTIVE SUMMARY

Business Description

Stop and think about some of the activities that occur in a typical day. Simple everyday duties such as going to the grocery store or cleaning in and outside the home may seem routine to many individuals. Unfortunately, for the elderly and homebound, these somewhat simple tasks can be a burden and often cause the individual to be forced into a care home. Through the non-medical homecare services Y.N.O.T. provides, elderly individuals in the Wichita area are able to remain independent in their place of residence.

This century will see an increase in the size of the elderly population as the large baby boom generation ages. From 2010 to 2030, the number of baby boomers age 65 to 84 will grow by an estimated 80%, while the population 85 and older will grow 48%. While most elderly people are not disabled, the likelihood of needing long-term care services increases with age. In Kansas there are currently 359,000 individuals age 65 and older, and in the year 2030 that number is expected to reach 605,000. Social changes in family size, and the number of women in the workforce, have affected the ability of informal caregivers to provide care for their elderly family members. Therefore, Y.N.O.T. is available when these informal caregivers cannot be.

Y.N.O.T. strives to maximize the needs of their clients while minimizing their tasks. We find that these services will appeal to two market segments, one being elderly individuals aged 65 and older who are limited in their daily activities and the other being the children of those elderly individuals. Our services will be individualized to meet the specific needs of each client and will also be distinguished from the competition through our offering of heavy housekeeping, education, and entertainment services. When these individuals and family members become aware that they are no longer able to do the things to remain in their home, we will respond to them by asking, “Y.N.O.T.? “

“Y.N.O.T., Non-Medical Homecare Services.” “Y.N.O.T.” is an acronym for “Your Needs, Our Tasks.” This name creates a non-threatening and memorable way to relate the needs of the clients to the services we provide. Those services are described in detail in Appendix: Services Offered.

Business Contact InformationY.N.O.T.120 Water Street, Suite 204Wichita, Kansas 67203Fax: (316) 222-7658Web site: www.ynot.comEmail: info@ynot.com

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OwnerJenna SavilleY.N.O.T.324 Pine StreetWichita, Kansas 67203(316) 420-7698

Social Security Number: XXX-XX-XXXX

Experience: (Describe owner’s experience that would be relevant to his/her ability to operate this business.)

Professional Relationships

Accountant: Gerald Banks, C.P.A. (316) 552-7968

Banker: Sheila Johnson, Bank of America (316) 776-8000

Insurance agent: Hugh Bracken, State Farm (specialty, small business) (316) 882-6750

Attorney: Danny Saville, Esq. (316) 220-5647

Advisory Board:

Bill Manness: C.E.O. of Syndeo Outsourcing and B.G.M. Marketing, who is an expert in human resource management and marketing strategies for the service industry

Sandra Schubert: Active elderly caregiver and senior volunteer

Danny Saville: C.E.O. of Justice Suites and practicing attorney

Legal Status: Y.N.O.T. will register as a single member Limited Liability Company, whose sole member will be Jenna Saville.

Purpose: Y.N.O.T. provides affordable services for elderly individuals or couples who wish to remain independent, but who require non-medical assistance to live in their homes.

Status: Y.N.O.T. is a start-up that will begin operations January 2007.

Business Type: Y.N.O.T. is a service business.

Products/Services: Y.N.O.T. provides six categories of services:

Personal care • Light housekeeping Supervision • Heavy housekeeping Companionship • Transportation

Services are available to individuals age 65 years and older who are limited in their daily activities.

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Reasoning: Heavy housekeeping services are needed in this market as individuals begin to realize the tasks they are unable to accomplish in their home. Simple tasks such as hanging up a picture or moving furniture, however, are considered heavy maintenance tasks by most homecare service providers. Many organizations have their employees sign contracts that specify the services they are able to provide. The small tasks that many individuals think of as a routine home maintenance, therefore, cannot be completed until a family member is called for assistance. Y.N.O.T. finds that this service should be offered among the other available services, as well as many other heavy housekeeping services an individual may need.

Goals

1. Obtain a minimum of 100 clients within three years of operation. 2. Increase the average number of months clients are able to remain in their homes by 5%

during the first year of operation. 3. Achieve a 15% increase in the number of hours of services provided by the end of the

second year of operation.4. Earn 10 referrals from local hospitals, churches, and senior centers in the first year of

operation.

Industry Trends/Outlook

Over the past two decades, the elderly population has grown twice as rapidly as the rest of the population. The Administration on Aging states that people age 65 and older currently represent 13% of the population and are expected to grow to be 20% of the population in 2030 (AOA, 2000). In 2011, the baby boomers will begin to turn 65, and by 2030, it is projected that one in every five people will be 65 years of age or older. In Kansas, there are approximately 359,000 persons age 65 and older, and this number is expected to expand to 605,000 persons by the year 2030 (C.O.A., 2004). These projections indicate that the elderly population expects to double over the next 30 years, reaching almost 70 million individuals. The most rapidly growing age group are those individuals age 85 and older, which is expected to double from 3.9 million to 8.5 million from 2000 to 2030. However, the most astonishing fact occurs in the year 2050, when the number of older individuals in the world will exceed the number of young individuals for the first time by reaching approximately 18 million individuals (K.D.O.A., 1999).

As the number of elderly individuals increases, the number of individuals who previously provided the care they require will decrease. National data shows that the majority of care provided to adults to prevent or postpone the need for nursing homecare comes from family members and friends (Federal Forum, 2001). A 1996 survey done by the National Alliance for Caregiving and the AARP indicated that 22.4 million U.S. households are involved in caring for an elderly relative (N.A.C. & A.A.R.P., 2001). That number accounts for almost a quarter of the population, which is three times the number that was found in the survey that was conducted in 1987. However, as more women enter the workforce and children move away from home, the homecare service provider will assume the responsibilities that were previously managed by families.

The primary caregivers of dependent individuals typically are women and, as more become part of the workforce, the number of caregivers available to elderly individuals to provide unpaid homecare reduces. Statistics indicate that 72% of current caregivers are women, 29% are daughters, and 23% are wives (N.A.H.C., 2000). By 2010, as the baby boomer generation

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reaches old age and begins to require assistance, the number of women available to provide basic services will be dramatically smaller than today. Therefore, it becomes increasingly important to develop an availability of paid service providers while also supporting the remaining informal caregivers who are still available to provide the level of care that is needed.

The U.S. Census reports that women will have a longer life expectancy than men and continue to outnumber them in the future (Census, 2004). However, women are considerably less likely to have an adequate retirement income than men, so most homecare service recipients are elderly women. The 2002 statistics for Kansas indicate that there are 37,158 women age 85 and older while there are only 14,612 men age 85 and older (C.O.A., 2004). The average age of homecare service recipients is currently 80.5 years. This number will remain stable over the next two years and gradually increase with the extended life expectancies.

One group of elderly individuals who will be most likely to need formal services are those that live alone and have no living children or siblings. For the state of Kansas, the 2000 Census states that 105,689 Kansans age 65 and older are living alone and that 77% of those individuals are women (Census, 2004). NAIC researchers have estimated that 1.2 million people age 65 and older will live alone in 2020. The 288,000 people who are age 85 and older and live alone without close family nearby are the most likely candidates for homecare services (K.D.O.A., 1999).

Business Schedule

Business operations for Y.N.O.T. will begin in January 2005. Y.N.O.T. will distribute services by being available whenever the need arises for assistance in the client’s home. This allows the services to take place exactly where the care is needed. Y.N.O.T. will not dictate when to schedule the services, but rather the client will. We will adjust to those schedules so that each client is able to remain independently in his or her own home.

Seasonality in Transportation

The Association on Aging states that more elderly individuals get out of their homes during the months of late spring to early fall (A.O.A., 2000). Therefore, they will require fewer hours of service during the winter months of January and February, where there is an average of 3 hours a month. There is an increase to 4 hours of service during the month of March and yet another increase to an average number of 5 hours of service needed for the beginning of the spring season in April. The average number of hours needed for transportation services remains at 5 hours through September and will experience a decrease to 4 hours in the month of October.

Seasonality in Heavy Housekeeping

Lawn and garden care are more frequently needed in the late spring, summer, and early months of fall. These are also the months where more maintenance and home up-keep is required, which is typically 5 hours a week or 20 hours a month. Through the winter months there is expected service due to snow and other heavy maintenance needs, but there will be significantly fewer hours of service provided than during the summer months. During the months of November to January there is an expected average of 2 hours a week, or 8 hours a month. During the months of February to May there is an expected average of 1 hour a week, or 4 hours a month.

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MANAGEMENT AND EMPLOYEES

Y.N.O.T.L.L.C. (service)

Management

Jenna Saville: CEO/President

o Double major in Entrepreneurship and Economics from Wichita State University

Daniel Marceau: COO/IT Coordinator

o Double major in Management and Financial Economics from Wichita State University

Michael Saville: CFO/VP of Finance

o Certified Public Accountant with a Bachelor’s and Master’s degree in Accounting and 20 years of experience in the field.

Wages for executive management are based on a rate of $40,000 during the first year for three executive members. During the initial months of operation, management will not receive any wages in order to allow for a positive cash flow. Their wages will begin during the third month of operation. In the second year, the wages of the top three executives will increase to $45,000 per year, and a fourth manager will be brought on board at $40,000 per year. In the third year of operation, the top three executive members will receive $50,000 per year, and the fourth manager will receive $45,000 per year.

Employees

Present and Future Personnel Needs:

Y.N.O.T. finds that as we grow throughout the first year and obtain more clients, we will need to have available more employed caregivers to provide those services. Research states that the average caregiver is 57 years old and female, but Y.N.O.T. will not only be hiring caregivers of this age group and gender (N.A.H.C., 2000). We will need and require caregivers of both the younger and middle-aged generation of males and females to provide the variety of services we offer. Locating the potential caregivers will not be as difficult as matching each client to an available caregiver, because Y.N.O.T. plans to recruit caregivers in the same locations that we look for potential clients. These locations include the senior centers, hospitals, and churches. Many individuals enjoy spending time with and helping elderly individuals, and the fact that they will be paid to provide those services only makes the recruiting that much easier.

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The individuals who will be employed to provide the level of care our clients require are those individuals who we would feel comfortable sending to our own parents or grandparents’ homes. Common characteristics of our caregivers include the following:

Range in age from 18–60 years old. Each caregiver works for our company because he or she enjoys helping others.

Each caregiver has undergone a thorough criminal background check before being hired.

Each caregiver has a current driver’s license with liability insurance, a safe driving record, and a properly maintained vehicle in safe operating condition to transport any individual.

Each caregiver has gone through extensive training to prepare for all reasonable contingencies.

Each caregiver is bonded and insured.

The employed caregiver becomes like a surrogate family member. A level of trust and friendship develops between the client and the caregiver, therefore bringing an end to the fear of manipulation that many elderly individuals have. More information is also relayed to the caregiver regarding the specific way the client would like his or her tasks completed. The caregiver wages will be as follows:

Type of Service Hourly Wage

Personal and Light Housekeeping $7.50/Hour

Heavy Housekeeping $10.00/Hour

Transportation $6.50/Hour

Mileage Fees $.37/Mile

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OPERATIONS AND SUPPLIERS

Operations

Service: The services of Y.N.O.T. allow individuals to remain in familiar surroundings and retain their current lifestyle. In most cases, remaining at home offers individuals freedom to continue the activities that have always provided them with a sense of both independence and belonging. Clients are able to attend religious services and social events, receive visits from family and friends, and do things in the way and place they always have.

We are an affordable solution for elderly individuals or couples who wish to remain independent but who require non-medical assistance to live in their homes. These services can be arranged as a short visit of less than one hour or for as many as 24 hours a day. Y.N.O.T. focuses on clients by helping them determine what is needed for them to maintain as normal and independent a lifestyle as possible within their homes. We will keep that focus during the entire relationship with the client through a four-step process for determining the services they want and need. The determination of services process includes the following steps:

1. Assessment : An in-depth evaluation to assess the client’s ability to function around the house.

2. Planning : Details the level and frequency of the services to be provided.

3. Monitor services : Y.N.O.T. will keep in touch with the client to continuously monitor the quality of care being provided.

4. Reassessment : The needs of the client are going to change over time and so will the level of services being provided. Therefore, the services being provided will be periodically evaluated to ensure that all of the client’s needs are being met effectively.

Facilities: We will grow from 10–20 employees to 50–100 employees within three years. We will lease a 250-square-foot office building downtown at 2nd and Water in Wichita, Kansas.

Insurance:Y.N.O.T. will obtain the following insurance policies:

Professional liability insurance General liability insurance Non-owned auto insurance Fidelity bond insurance Workers’ compensation Business property insurance

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Service Distribution:

The average client receives 30 hours of care a week, which is 120 hours a month (C.O.A., 2004). This is how those hours are distributed among our available services:

Type of Service Average Hours/ Week

Average Hours/ Month

Hourly Rate

Personal and Light Housekeeping

24 Hours/Week 96 Hours/Month $12.50/Hour

Transportation 3 Hours/Week 12 Hours/Month $10.00/Hour

Average Miles Traveled

15 miles/3 Hours a Week of

Transportation

60 Miles/12 Hours a Month of

Transportation

$.40/Mile

Heavy Housekeeping 3 Hours/Week 12 Hours/Month $14.00

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MARKETING PLAN

Slogan: “Your needs, our tasks, Y.N.O.T.? “

Market(s): While most elderly individuals are not disabled, the likelihood of them needing assistance in their daily lives increases with age. The type of care and assistance needed is not medical care but supportive care, and it does not require the use of a nursing home. Y.N.O.T. will appeal to two demographic segments found in the Wichita, Kansas region. A major determinant of the market for long-term care is the extent to which future generations of elderly individuals will be able to afford these services. Future long-term care perceptions are expected to influence the way baby boomers prepare financially for the care they will require. A National Council on Aging survey reports that 48% of their respondents have done little or no long-term care planning (N.A.H.C., 2000). Our current state and federal policies require that people pay the full cost of their long-term care needs until they have no available financial resources. Therefore, it becomes obvious that many individuals are unaware of their options in regards to financially preparing for long-term care that might be needed in the future.

Many individuals may begin planning for their retirement early in life, but few plan for their long-term care needs. Companies have begun to implement the option of long-term care insurance into their benefits plans, but few individuals know much about the offering and what it entails (Cohen, 2000). Therefore, Y.N.O.T. offers future planning information to all individuals, regardless of a person’s age. This information will be made available in an online format, continuously updated with forum options available for questions, comments, or suggestions for all to see. We find that this information is needed and not currently made available by the homecare service providers, even though it is an important issue that all businesses will soon face.

1. The Potential Customer: Middle class individuals aged 65 and older who have at least one limitation in performing the activities of daily living. The 2002 median household income of individuals aged 65 to 74 is $31,565, while for individuals age 75 and older it is $22,189 (Census, 2004). The fastest-growing age segment among elderly individuals is those aged 85 and older and currently require the most assistance. In Wichita, there are currently 7,307 individuals in that segment, and this number will increase substantially as the baby boomers get older (Census, 2004).

2. The Family of the Potential Customer: There are 46,914 households with people age 65 and older living in them in Wichita, Kansas and among those households, 21,255 individuals are living alone (Census, 2004). Y.N.O.T. understands that today’s busy lifestyles often deprive family members of the time necessary to provide assistance for their loved ones. Y.N.O.T. will be available when they cannot be and provide the care needed for those individuals.

. Geographic Scope: Wichita, Kansas, and surrounding suburbs

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Buyer Profile: Y.N.O.T. finds that the market of potential customers is best segmented by the ages of the individuals being served. The market for Y.N.O.T. is segmented as follows:

Market AnalysisPotential Customers Growth 2004 2005 2006 2007 2008 CAGRIndividuals Age 60–74 Years Old

2% 32,567 33,218 33,882 34,560 35,251 2.00%

Individuals Age 75–84 Years Old

2% 21,674 22,107 22,549 23,000 23,460 2.00%

Individuals Age 85 Years and Older

4% 7,307 7,599 7,903 8,219 8,548 4.00%

Total 2.24% 61,548 62,924 64,334 65,779 67,259 2.24%

Product: Non-medical Homecare for the Elderly

Y.N.O.T. will provide a continuum of services for elderly individuals that complement and enhance support. This entails quality services to all clients, so that they are able to maintain maximum independence and optimum quality of life while in their own home.

Benefits: Through the non-medical homecare services Y.N.O.T. provides, elderly individuals in the Wichita area are able to remain independent in their place of residence.

Differentiation: Unlike home health care providers, Y.N.O.T.’s services will not require a doctor’s prescription. Unlike independent providers, Y.N.O.T. will focus not on one or two specific services, but rather on a broad range of services. Y.N.O.T. will have a competitive edge in the areas of heavy housekeeping, education, and entertainment services. We do not require a minimum number of hours of service for each visit, which allows our services to remain affordable for the client who requires only one or two hours of service per visit. We also have the flexibility to meet the changing needs of the client, whereas a franchise organization is often unable to do so.

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Price

Y.N.O.T. will implement a pricing scheme based on the anticipated number of hours per session. The categories of services and the rates for those services are as follows:

Category Rate

Personal and Light Housekeeping Services $12.50/Hour

Heavy Housekeeping Services $14.00/Hour

Transportation Services $10.00/Hour

Mileage Fee $.40/Mile

Economics of One Unit (One Week of Services)

Service Revenues: Avg. Hours Hourly Rate Total

Personal and Light Housekeeping Services 24 $12.50 $300

Heavy Housekeeping Services 3 $14 $42

Transportation Services 3 $10 $30

Mileage Fees 15 $0.40 $6

Total Revenue $368

Cost of Services:

Personal and Light Housekeeping Services Wages 24 $7.50 $180

Heavy Housekeeping Services Wages 3 $10 $30

Transportation Services Wages 3 $6.50 $19.50

Caregivers Mileage Fees 15 $0.37 $5.55

Cleaning Supplies $2.00 $2.00

Total COGS $237.05

Contribution Margin (Gross Profit) $140.95

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Place: We will grow from 10–20 employees to 50–100 employees within three years. We will locate in a 1250-square-foot office building downtown at 2nd and Water in Wichita, Kansas. This location is in the heart of Wichita and allows for easy travel to all locations.

Promotion

Services of Y.N.O.T. are marketed through the following four-pronged approach:

1. Brochures and flyers: Members of our target market can obtain these in various senior centers, hospitals, and churches in the Wichita area.

2. Website: This communication channel is detailed in the Web Plan section of the marketing plan.

3. Strategic Alliances: Y.N.O.T. will develop strategic relationships with local churches, senior centers, and hospitals in the Wichita area. Both organizations will benefit from the use of each location’s customer base and individual offerings. We are then able to refer our clients to these organizations’ services if we do not provide them, and they are able to do the same.

4. Referrals: This is one of our strongest areas of promotions in that our clients are going to communicate to their friends about issues and concerns in their life. The feedback we obtain will allow for continuous improvement and more positive client feedback and satisfaction.

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Marketing PlanElement of Marketing Start Date End Date Budget Manager DepartmentSearch Engine and Website Evaluation and Listing

6/30/2004 7/15/2004 $0 Danny Web

Focus Group Website Discussion

8/1/2004 8/10/2004 $20 Jenna Marketing

Website Launch 9/15/2004 10/15/2004 $400 Danny WebFlyers Distribution 10/30/2004 12/30/2004 $100 Jenna MarketingTri-fold Brochure Distributions

10/30/2004 12/30/2004 $300 Jenna Marketing

Phone Book Listing 7/1/2004 7/30/2004 $240 Jenna MarketingSenior Centers 2/30/2005 3/15/2005 $0 Jenna MarketingChurches 3/30/2005 4/15/2005 $0 Jenna MarketingHospitals 4/30/2005 5/15/2005 $0 Jenna MarketingPostcard Distributions 6/1/2005 8/1/2005 $100 Jenna MarketingClient Focus Group on Current and Possible Services

12/1/2005 12/15/2005 $20 Jenna Marketing

Business Cards 12/1/2004 12/30/2005 $30 Jenna MarketingTotals $1,210

Website Marketing Strategy:

Y.N.O.T. has a website strategy that will focus on communication in providing the most current and useful information to the two segments of our target market. In society today, people over the age of 60 comprise the fastest growing segment of the estimated 80 million online users in the United States. They have the time to use the Internet, and as they become homebound, they are able to stay connected to what is occurring in the rest of the world. As these individuals become more independent, they are better able to realize the additional support they require in order to remain independent in their surroundings.

These elderly individuals will not be the only ones to make use of this availability, but so will the other segment of our target market, their families. These individuals will also be able to post references, letters, and questions regarding their issues or areas of concern for their elderly family members. Through this website offering we will be able to receive emails, inquiries, and allow access to forums to ensure effective communication with families and clients.

The National Library of Medicine states that “Good information is the best medicine for older adults. Web site designers can help seniors find answers to their medical questions and support answers from the comfort of their own home” (Holt, 2000). The information is not being forced upon them but rather is available when they wish to make use of it. This is important for many elderly individuals because so many believe that those who try to provide support or assistance are only trying to manipulate them. The information we provide is important for them to read and understand and may also make seeking homecare assistance much easier.

The communication strategy for the website provided by Y.N.O.T. will focus on three principles:

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1. Opportunity: Allowing individuals the ability to obtain the required and important information needed for their lifestyle.

2. Motivation: The ability to apply the education and information obtained from our website to their lifestyle and future needs.

3. Fulfillment: The feeling of success or happiness by individuals, in knowing that the information was applied and promotes a long life of happiness while allowing them to remain independent in their homes.

The Y.N.O.T. website will be developed during the first month of operation by an internal employed Internet Technology Website Designer. This individual will maintain the website on a full-time basis, which will include all research, advertising, and maintenance.

The National Institute on Aging and the National Library of Medicine has developed a set of “senior friendly “ guidelines that are specific to the older adult Internet user. These guidelines will be incorporated into the design and up-keep of our website offering (Adler, 2002). The research in aging, cognition, human factors, and print materials leads to the development of guidelines covering three areas of design:

1. Designing readable text2. Increasing memory and comprehension of web content

3. Increasing the ease of navigation

Website characteristics include the following:

The font will be a sans serif typeface, in size 12 or 14 points for the body of the text, with a medium or boldface type.

The body of the the text will be in upper and lowercase letters, while the headlines will use all capital letters and italics.

Underlining will only be used for links, so that the user can more easily identify which are links to another page and actual text.

The body text will be double-spaced.

A dark color will be used for all text and graphics against a light background, such as black lettering on white background. There will be no patterned backgrounds or colors such as yellow, blue, and green in close proximity.

The same symbols and icons will be used throughout our entire website offering to make navigation simple and common in all locations associated with our site.

COMPETITION

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Elderly individuals seek homecare service providers for two main reasons:

1. The individual has reached a point where he or she requires some assistance with the daily tasks of living; without this assistance, a tremendous amount of stress is placed on the individual and his or her family.

2. The individual has been told or recommended by a healthcare provider to seek assistance or move to a Long-Term Care Facility. Many individuals often resort to an Assisted Living or Long-Term Care facility because they are unaware of their options and have not adequately planned for their future.

In the areas of competition, Y.N.O.T. finds that it has four types of competitors:

1. Individuals: There are still some individuals who are homecare providers for their family members, but this competitor is a shrinking market segment.

2. Homecare providers: The majority of these providers are nation-wide franchise organizations under the control of their franchiser and bound by contract in the services they offer. These companies lack the flexibility to respond to changing needs or additional requests by the client unless it is agreed upon by their franchisor. These providers do not provide any heavy housekeeping services and require a minimum number of hours of service with each visit. A minimum of more than two hours is not necessary for some of the required services and is often a reason why elderly individuals do not seek in-home assistance.

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The following organizations are found within this segment of competition:

Business Name Strengths/Weaknesses

Comfort Keepers

Strengths: Known nation-wide for their services; free public informational seminars on elderly related topics; use of a sliding scale of rates to focus on more services at a lower price per hour.

Weaknesses: Requires a minimum of two hours of service per visit; high rates for a few hours of service; double rate for holidays; Mileage fee of $.55 per mile.

Right at HomeStrength: Strong focus on companionship with the client.

Weakness: Requires an initial face-to-face meeting before any information on services and rates will be released to the client.

Saint Raphael Home Care, Inc.

Strengths: Includes medical reminders; specializes in short visits with clients and willing to stop by their home up to five times a day; homecare services include therapy programs.

Weaknesses: Employs medical staff to perform homecare services and charges a higher rate for their availability; homecare services do not include respite care or transportation services.

Home Instead Senior Care

Strengths: Known world-wide for their services; strong emphasis on the continued education of their employees through training seminars; Alzheimer’s care program.

Weaknesses: Minimum of three hours of service per visit; high rates for holidays and more than 12 hours of service per visit.

Kelly Home Care Services

Strengths: Known world-wide for their services; affiliated with Kelly Staffing, a company that provides temporary employees when they are needed.

Weaknesses: Services are not targeted toward elderly individuals but those with disabilities and health problems; employs registered nurses for all non-medical services.

Progressive Home Support Services

Weaknesses: Focuses on rehabilitation and short-term services for sick individuals; employs registered nurses for non-medical services; requiress an initial assessment before rates and company information can be discussed; homecare services do not include respite care or transportation services.

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3. Home Health Care Providers: These organizations focus on the availability of health care services provided by a registered nurse with an emphasis on assistance in medical needs. The major difference between these organizations and those of traditional homecare service providers is the doctor’s order required for these services to be provided.

The following organizations are found within this segment of competition:

Business Name Strengths/Weaknesses

Advantage Home Care, Inc.

Strength: Affiliated with Kelly Homecare and Kelly Staffing Services.

Weaknesses: Requires a doctor’s order to begin an assessment; each client is assigned a specific case manager; no available light housekeeping, transportation, or respite care services available to clients; if these are needed, Kelly Homecare will provide those services; a registered nurse will provide all services to the client.

Afford-A-Care, Inc.

Strengths: Employees are trained in hospice care; sliding scale of rates to promote more hours of service at a lower rate.

Weaknesses: Focuses on a trained medical staff who provides all services required by the client; requires a minimum of four hours of service per visit.

Loving & Caring Hearts of Wichita

Strength: Affiliated with Caring Hearts of Wichita, which focuses on health care services.

Weaknesses: Requires a doctor’s order before an initial assessment can take place; employs registered nurses for all services required by the client; does not provide any transportation services.

Total Homecare & Hospice

Strength: Home health services and hospice services are combined or kept separate for each client’s scenario.

Weakness: Employs registered nurses for all services required by the client.

Blessed HomeStrength: Homecare services work hand-in-hand with their medical health services.

Weakness: Strong emphasis on religious associations.

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4. Independent Providers: These providers tend to focus their services on one specific area of the general services Y.N.O.T. makes available for their clients. Therefore, these organizations are also considered indirect competitors in that they provide the services we make available but as a single service rather than a combination of services. Many of these organizations are also non-profit or are only available at specific times and places during the year.

The following organizations are found within this segment of the competition:

Business Name: Strengths/Weaknesses:

Senior Friends Medical Transportation

Strengths: Affiliation with Wesley Hospital; employs full-time professionals for transportation services.

Weaknesses: High transportation rates; only transports the client to Wesley Medical Center.

Senior Services of Wichita

Strengths: Affiliation with the United Way Foundation; includes four segments of services within their business: Meals on Wheels (volunteers deliver daily meals to those who cannot prepare their own), Neighborhood Connection (volunteers are matched with low-income individuals who require light chore assistance in the home), Roving Pantry (volunteers take telephone grocery orders and deliver them to the customer’s home), and Retired and Senior Volunteer Program (elderly individuals are matched with volunteer community work for local non-profit agencies).

Weaknesses: Services are not available on an on-going basis; for services to be provided, elderly individuals must meet specific qualifications.

Senior Companion Program

Strengths: Affiliation with Riverside Health Systems; volunteers provide supportive person-to-person services.

Weakness: Services are provided to individuals with mental, physical, or social needs.

Competitive Strategy: The Y.N.O.T. competitive strategy is to develop and maintain and edge over the competition in the areas of heavy housekeeping, education, and entertainment services.

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To carry out this strategy, Y.N.O.T. will use the following tactics:

Unlike home health care providers, Y.N.O.T.’s services will not require a doctor’s prescription.

Unlike independent providers, Y.N.O.T. will focus not on one or two specific services, but rather on a broad range of services.

Y.N.O.T. will not require a minimum number of hours of service for each visit, which allows our services to remain affordable for the client who requires only one or two hours of service per visit.

Y.N.O.T. will have the flexibility to meet the changing needs of the client, whereas a franchise organization is often unable to do so.

Mission Statement: Y.N.O.T. will provide affordable non-medical homecare services that support independence, by providing assistance, to elderly individuals.

Vision Statement: To create happy moments and smiles by helping the elderly remain independent.

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FINANCING REQUEST

Loan Requested: $10,000Owner Investment: $15,000Total: $25,000

Use of Funds

Item Quantity Cost

Leasing office space First month’s rent plus security deposit (lease covers gas, electric, and water utilities)

$4,000

Minor remodeling of office Building cubicles, flooring, etc. $2,000

Obtaining city, county, and state licenses

LLC registration for sole owner.Trademark/servicemark registration.

$500

Insurance Deposit for liability and bonding $1,500

Office equipment 3 computers, 1 laptop, copier/printer, fax machine, phones $2,000

Office furniture (to be purchased from estate sales)

Desks, chairs, etc. $1,200

Household cleaning supplies Enough for first month of operations $600

Phone, internet, web hosting services

Purchased from Cox Communications and supplied on a monthly basis. Two phone lines for the first month with free installation at $23.99 per line.Cable modem for Internet installation will cost $49.50.Labor and cable connection installation will cost $199.99.

$300

Advertising and promotions Several flyers, brochures, signs, and meetings with churches, hospitals and senior centers.

$100

Professional and legal fees $500

Employee training seminars Seminars will supply the needed training for executive management to understand the business in all aspects. These seminars will also provide the information needed to begin a training program for the employees, if needed.

$500

Total Startup Investment $13,100

Cash Reserve $11,900

Total Startup Investment + Cash Reserve $25,000

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Collateral

I can secure the loan with $2,000 I have invested in stocks and bonds; with my car, valued by my insurer at $10,000; and the equity in my condo in downtown Wichita, valued at $120,000.

Investments (stocks and bonds): $2,000 Car: $10,000 (appraised insurance value)Equity in Real Estate: $60,000 (equity in $120,000 condo with $60,000 remaining on mortgage)

Total Collateral: $72,000

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BUSINESS FINANCIAL STATEMENTS

Please see attached Excel files for:

o Projected income statement

o Projected cash flow statement

o Projected balance sheet

Projection Assumptions

Forecasted sales are based on the expected number of clients each month and the average hours of services each client will require during that month. Y.N.O.T. expects to begin its first month setting up the business and actively marketing the services we will make available to our target marketing. The second month of operation will begin with two initial clients and then grow to five clients in the third month. Through the end of the year we expect to gain five clients a month and end the first year with 50 clients. Sales will increase as the months pass due to the increase in clients and the number of hours of service required by those clients. Y.N.O.T. expects to then grow its personal and light housekeeping hours of service at 10% and the heavy housekeeping and transportation services at 5% in the next two years.

Cash Flow Assumptions

Investments: The owner will contribute $15,000 start-up capital in the first month. The capital was

obtained from family contributions and will be paid back at the end of the fifth year of operation.

A 10-year 6% annual loan will be established, and payments on principal and interest will begin in January of the first year.

Revenues: These figures were taken directly from the sales forecast spreadsheet. The revenues obtained from mileage fees are based on a rate of $.03 per mile driven in

the caregiver’s vehicle.

Direct Expenses: Wages for all light housekeeping and personal care services are based on a rate of $7.50

per hour. The number of hours of service for all wages were obtained from the sales forecast.

Wages for heavy housekeeping services are based on a rate of $10.00 per hour. Wages for transportation services are based on a rate of $6.50 per hour.

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Mileage reimbursement is based on a rate of $.37 per mile driven in the caregiver’s vehicle.

Cleaning and heavy maintenance supplies are purchased from a wholesale distributor and fluctuate with sales.

Indirect Expenses: Rent and utilities are paid through a monthly lease of $1,000. Wages for executive management are based on a rate of $40,000 during the first year for

three executive members. During the initial months of operation, management will not receive any wages in order to allow for a positive cash flow. Their wages will begin during the third month of operation. In the second year, the wages of the top three executives will increase to $45,000 per year, and a fourth manager will be brought on board at $40,000 per year. In the third year of operation, the top three executive members will receive $50,000 per year, and the fourth manager will receive $45,000 per year.

Legal and professional fees are based on a stable rate of $500 per month as executives meet on a monthly basis to ensure that all regulations and concerns are being faced.

Business and payroll taxes are based on a combined rate of 12% of wages. The taxes increase with the larger payroll.

Internet and hosting utilities are paid on monthly basis through Cox at a rate of $99.95 per month. However, by also obtaining phone utilities from Cox at $23.99 per phone line a month, we will receive a 15% off monthly discount on the internet and hosting utilities.

Phone utilities will include two separate phone lines, one for fax and one for phone. These lines will be purchased at a rate of $23.99 per phone line.

The amount of purchased office supplies correlates with sales on a monthly basis.

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PERSONAL FINANCIAL STATEMENT

Jenna Saville324 Pine StreetWichita, Kansas 67203(316) 420-7698

Social Security Number: 390-89-3214Date of Birth: March 20, 1979

Employer name, address, contact: Manager, Lucille’s BBQ Restaurant, 230 State Street, Wichita, Kansas 67203. (316) 375-6758

Assets

Savings Accounts $3,000

Retirement Accounts $1,200

Accounts and Notes Receivables N/A

Life Insurance, cash value N/A

Stocks and Bonds, market value $2,000

Real Estate, equity value $60,000

Automobile, equity value $10,000

Other Assets $0.00

Total Assets: $76,200

Liabilities

Residential Mortage, amount owed $60,000

Other loans $0

Unpaid taxes $0

Other liabilities $800 (credit card)

Total Liabilities $15,400

Net Worth $32,500

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FINANCIAL RATIOS

Debt Management Ratios

Debt Ratio: Debt-to-Equity Ratio:

Profitability Ratios

Return on Investment: %

Return on Sales: %

Payback Ratio: ___months

Liquidity Ratios

Quick Ratio: Current Ratio:

Working Capital

$________________

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BREAK EVEN ANALYSIS

Fixed Costs (from projected monthly Income Statement)$_________

Gross Profit per Unit (from projected monthly Income Statement)$__________/_____ units = $______

Break-Even Point = _____________ units

I need to sell approximately _______________ units of service per month for my business to break even.Given that my monthly projection is to sell ________________units per month, the business will be able to cover its costs.

EXIT STRATEGY

My exit strategy is ______________________________________________________. This exit strategy is attractive to my potential investors because _______________________________________________________________________________________________________________________________________________.

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