Brief synopsis- Business strategy

1CARD

Business Feasibility Study

New Business Venture

Description

1CARD is a technology company that allows consumers to combine multiple cards into one simple and secure location. 1CARD sees a definitive role in the market for technology that allows users to combine loyalty, membership, gift, and credit cards into one simple and secure card. 1CARD was generated as the product of extensive research on consumer spending habits, which resulted in a clear market opportunity. After researching, there was a noticeable consumer pattern to not only use credit for the majority of transactions, but also to use a loyalty or membership card for most transactions. This led to the strategy to combine all of these numerous cards into one simple and secure card.

We see this technology as being easily accessible and highly affordable to all consumers. 1CARD will be profitable among consumers of all incomes, demographics, and ages. This technology will in no way be limited to a certain area of the market. In any location that credit, loyalty, membership, or gift cards can be used, 1CARD will fulfill a pivotal role. Furthermore, this technology eases the consumers’ burden, as it may be implemented into already existing credit cards. There will be no limit as to the number of cards or the amount of information that can be stored with 1CARD technology. In addition to keeping updated with the retailers’ software, 1CARD will also offer a central web space where balances and transactions may be accessed by the end user.

Opportunity

The recent proliferation of brand and store based loyalty and membership cards have come to burden the consumer. While seemingly counterintuitive, this idea which first started as a consumer convenience has spawned into an explosion in number. Yet many retail outlets are now offering sales or reward points only to those consumers who present their respective card. This need to have many cards at all times has become cumbersome to the consumer who has either a wallet or a keychain overflowing with cards. Furthermore, the consumer tendency towards credit transactions fits ideally with our business model.

Unlike other devices that require you to manually select one card at a time, 1CARD contains all of your information securely and simultaneously. The potential for consumers to carry only one card in their wallets will be very attractive to casual and frequent shoppers alike, of all income and demographic sectors, and reaching to all varieties of retail markets and beyond.

We believe that key selling points are the combination of simplicity and security. The addition of 1CARD to the consumers’ wallet will require little work or cost on their part, and will greatly make up for any inconvenience. Furthermore, just as existing personal identification information is stored on a credit card, so too will all of the additional information be secure and only accessible through qualified retail physical devices.

Methodology

1CARD solves the impending consumer burden by securely storing all loyalty, membership, and gift card information within the magnetic strip of an existing credit card. Therefore, 1CARD will keep physical costs to a minimum, and will rely on the software and data mine backbone, while licensing the technology to existing institutions. We see our business as one who creates and builds the virtual background and technological basis, and then licenses the technology to large corporations who will pay a miniscule fee per transaction. Consumers can enjoy the freedom of only having to carry a single card, while also knowing that their balances and points will be stored accurately and securely. This will place no additional cost or burden on retailers, as our technology is specially tailored to comply with existing card-reader technology.

1CARD will maintain routing devices that will direct the transaction to the appropriate retailer’s software for the purpose of validation and transaction storage in addition to storing the information in our database, and will also reflect this information via their web portal. Our web space will be self-service on the customer’s part, as they will have the opportunity to not only enter more loyalty and membership cards into their 1CARD account, but also to track their balances and transactions.

1CARD seeks go generate revenue at the onset by licensing the technology to major credit card companies. Our guarded first-year goal is to have our technology on one percent of each of the five major credit corporation’s transactions. This is a very cautious estimate, being offered at an extremely low rate, which still will provide for generous return on capital. Future growth stands to be aggressive, as we strive to increase our market share by licensing our technology to credit companies for more and more of their consumer’s transactions, and by expanding our target markets. We also see a future role for our data mine, as we can release information on consumer buying habits for targeted advertising, without violating consumer trust. This stands to bring in significantly more revenue than at our onset.

As 1CARD is a new company with a radical new idea, we are fully prepared with a trained customer service staff ready to serve not only consumers but also retail and corporate clients. We believe that a smooth transition into the marketplace will assure our future success and permanent role in the marketplace.

Competitive Advantage

1CARD is seeking to embrace a blue ocean strategy by stepping out of the traditional roles of credit cards and loyalty cards by combining them. We believe that we are market initiators who will serve a pivotal role once consumers take notice of our product. We furthermore believe that we have a product and technology that stands to be a permanent player in the market. We see retailers as being minimally inconvenienced by our technology, and consumers finding our technology to be indispensable.

In order to stand out from any present or future competitors, 1CARD offers:

( One simple and secure card that contains all of your membership, loyalty, and gift cards

( One card where all contained cards are ready at all times

( Minimal burden to retailers

( No new physical infrastructure required

( Unrivaled customer support

( Customer-friendly web space that tracks all balances and transactions

Our customers will receive great benefits from demanding the 1CARD, and our business model allows for the transition to be quick and easy for both retailers and consumers. This simple and effective technology stands to quickly be a permanent member of the marketplace.

Industry

Product/Service Analysis

The emphasis in today’s economy is always on convenience. Consumers are willing to spend extra money for added convenience and that is what this 1CARD will provide them. Our product will allow consumers to add their credit cards, loyalty card as well as gift cards, all on this 1CARD. The consumers will not have to worry about carrying an entire wallet filled with cards, because they will have access to all of them all from our product.

Since our product will be in a form of a credit card, there are no licenses that will be needed. The original patent for a Magnetically Coded Identification Card was first filed in February of 1981 with the patent number 4253017. According to the law, since a patent was filed over 20 years ago, it does not require a license for us to use. We will however file a patent for our product once it is completed which will allow us to collect a small share of profits from the credit card companies for having the license to use our product.

Industry/Market Analysis

The credit card industry has been on an incline as of late. Due to its continuous growth, MasterCard went public with VISA soon to follow. The new and younger generation often feels that using credit cards is far more convenient then carrying cash around. As seen in recent VISA card commercials, that person using cash only slows down the economy. Not all consumers feel that way, but many of the younger generation find credit cards much easier. In the future, analysts have predicted credit card transactions will only continue to grow. Credit cards will continue to expand to other countries that have not yet been exposed to them in a manner that United States has. It is predicted that only about 11% of the consumers in the world carry credit cards, and that number is expected to grow by 2%-3% every year for the next 10 years. This proves that credit card transactions will only continue to rise across the world, which creates an even larger market for our product. The graph below shows how far ahead the United States is in comparison to the rest of the world that has just begun using this form of technology.

Table 1 below shows the extent to which credit card and charge card were used in different countries in 1998 and 2005 to show the continuous growth across the world.

Table 2 below shows the actual and forecasted growth by region. This is just further proof of another study done by Global Insights to prove that continuous growth in the credit card industry.

Data above assures that the credit card industry is going to continue to grow. Because of this growth I feel they will accept our product and be willing to pay us a small percentage of their profit ($0.0033) for each transaction because of the added convenience our product will provide the consumers. Credit card companies will find it is much easier to sell their credit card to consumers because of the perks they could offer. There are several consumers that are not comfortable with having various credit cards and like to carry one. Our product will cater to that group, who can have various credit card accounts, but can manage all of them through one credit card. We feel that our product will only help the credit card companies market their product even more effectively with the use of 1CARD.

Competitive Analysis

Currently there are not many competitors in the market providing this product. There is a competitor providing a product called iCache. The way iCache works is that users register their cards on the company Web site and upload the information into the iCache. When they want to use it, they activate the device with a fingerprint on its biometric strip, scroll through a list of cards on its screen, and choose one. Out pops a plastic card with a magnetic stripe, temporarily loaded with the chosen card's data. Just swipe the card and pop it back into the iCache. After one use, the information on the card disappears. The device even works with loyalty cards, such as those handed out by supermarkets. The inherent problem with this product is that only one card can be selected at a time. After you use a card, you will have to insert your iCache card back into the device to load it with the identification of another loyalty card. This is precisely the inconvenience that 1CARD seeks to avoid.

Although this product is not completely similar to the product we are producing, it still serves the same consumer base and the market that we are trying to launch ourselves into. This product seems to be more technologically complicated then our product. Our product would be a simple credit card that can be swiped through a regular credit card machine. This will allow the consumers that are not technologically advanced to still use our product without having to deal with any technology deficiencies.

iCache is expected to go on sale sometime this year and expects to sell 7 Million units at the end of 2009 for $99 each. Our product is not directly being sold to the consumers, but to the major credit card companies instead, ho will then issue our product to the consumers and provide us a very small portion of their proceeds to allow their consumers to have the added convenience of having all cards in one.

1CARD is the solution for all types of consumers from all parts of the world without having any direct cost to the consumers. This next generation credit card is sure to be a success for all credit, loyalty and gift card users.

Five Forces Model

1. The threat of substitute product – As stated above, There currently isn’t a product available similar to the one we are producing. There is the iCache, which is not similar to our product. There isn’t a substitute in the market for the product we are offering as it will be a new product.

2. The threat of the entry of the new competitors – For this reason, we are going to have a patent for our product once it is produced. This will entitle us to licensing fees from anyone that wishes to use our product. As we more towards the future, it is very likely that there may be products out in the market that sell the same idea we do, but we want to the first ones with this idea.

3. The intensity of the competitive rivalry – This really does not apply to us as this is a new idea and a new product that will be available in the market. It is likely that the competitive rivalry will began once there are more similar products out in the market, but current the rivalry does not exist.

4. The bargaining power of the customers – Our customers will be credit card companies mainly. The will not have much of a bargaining power since our product is so unique and there isn’t a competitor in the market that provides them a similar product. Plus our product will provide added convenience for their consumers, which will in turn generate more revenue for them. We admit that with a high volume product like ours, who seeks to earn revenues based on fees per transactions, stands at risk of collective bargaining power, we feel that the sheer volume of our transaction base will absorb any risk involved.

5. The bargaining power of the suppliers – We are not going to be creating a product, we will be licensing it. Therefore this will not apply to us.

Based on our research of our competition and our analysis of the Five Forces Mode, we believe that our product is unique to the market and will be successful because of the convenience that it will provide for the end users. We expect the product to be in high demand once the benefits of the products are marketed to our customers who are mainly the credit card companies and consumers who are the end users.

Operational Structure

Our current team and advisors will consist of the following:

· Chief Executive Officer: Athar Adam

· Chief Financial Officer:

· Chief Operating Officer:

· Chief Marketing Officer:

· Chief Technology Officer:

· External Consultants

Our current advisors are very well educated in the area in which they specialize. We will be hiring consultants in order to help us design the software and help implement it as well. They will provide us with good knowledge in order for us to make valuable decisions in order for our company to succeed.

Legal Structure

The 1CARD will be an LLC corporation for several reasons. One of the main reasons is due to the fact the owners will have limited liability if in the event a law suit were to take place against the corporation the owners are protected to some extent.

Technology

The technology we intend to use is entirely software based. In order for us to accomplish our idea we will be using the magnetic strips on the cards. The magnetic strips currently hold the consumers information, we will use the same concept and our software will be able to add the information from all the other cards as well. The magnetic strip will contain loyalty cards, gift cards, and membership information and balances. Our software will also be able to recognize the store and give the consumer the option to use the gift card they have stored on file or use their credit card. Consumers will be able to view their balances and information online and be able to upload or delete cards. We intend to create the software and be able to sell it to the current major credit card companies i.e. Visa, MasterCard, Discover, American Express, and Diner’s Club. The consultants that we hire will be a crucial part in the development and implementation process. The research and design phase will essentially be their section and verification through the CTO. We will then produce the software and market it to all the credit card companies. After distributing the software we will provide technical support to the companies in case there are any glitches with the software.

Benefits

The customer will receive several benefits from this product. In today’s society it seems like there is a card for everything. It is practically impossible to carry all cards at all times. A lot of people have to pick and choose and most of the times they forget to use the cards they do not have in their wallet. Since all the information will be saved on the one card that they will always have they will always have the opportunity to use their gift cards and or loyalty cards with out having a huge wallet. The consumer will also be able to access all of their information on a secure website. They will be able to track all their purchases balances and reward points to any applicable card. They will also be able to upload a document to their computer in order for accounting purposes.

As a company we will not need any suppliers since we will be creating the software and selling the software to the major credit card companies. We believe there is a real “value innovation” inherent to this card, and it will convenience the consumer in turn causing the use of the card to increase causing higher revenue for the credit card company. Currently there is only 1 product out on the market; however the product appears to be heavier and larger than the standard credit card. The competition also provides no benefit to the credit card company. We are directing all of our focus to the credit card company because at the end of the day the credit company is buying our software and causing our company to be successful. The most important aspect to the credit card company is for them to be successful because of the licensing we sell them. The only way the credit card company can make money is when their consumer uses their card. If the card has an attractive attribute that makes the consumers life much easier than they will use the card a lot more than any other card.

Marketing & Sales Strategy

Marketing – Pre-Launch

Market Segmentation

1CARD will be geared specifically towards the five credit card companies: American Express, Discover, Diner’s Club International, MasterCard, and Visa. Through 1CARD, we are implanting technology within the magnetic stripe of existing credit cards that will allow users to add membership, loyalty, and gift cards onto existing credit cards so that customers are served with the most convenience available.

Marketing Strategy

Currently, aggregate annual credit card transactions are estimated at roughly 50B in the United States alone. 1CARD’s primary objective is to target the five credit card brands: American Express, Discover, Diner’s Club International, MasterCard, and Visa. Unlike conventional credit cards, 1CARD is unique in that it allows major credit card companies to give their customers the option to add membership, loyalty, and gift cards all onto “1CARD,” so that they only have to carry “1CARD” with them. We plan on building a multi-tiered marketing strategy in order to effectively target the creditors who cater to different demographic segments within the overall market of credit card users. As part of our business plan, creditors who sign on to the 1CARD program will pay 1CARD 1/3 of a cent of the fees which they collect from purchases made by their card users. Our marketing strategy is based on convenience for the customer so that they can always be rest assured that they don’t forget a gift card from a year ago or a credit card since it will be “1CARD.”

Traditional Marketing Strategy

As a company, 1CARD, our traditional strategy will involve contacting major publications such as, but not limited to, the “Wall-Street Journal,” “Economist Magazine,” and the “Chicago Tribune.” By targeting major magazine and newspaper distributors, we will be able to better reach the consumer base. We will also use various billboards and plan on using the direct mail method so we can reach out to a mass amount of consumers who will see that the “1CARD” is the most convenient card around. The direct mail method is also one of the most inexpensive ways of marketing. Additionally, we will then release a statement for a later date where we will hold press conference listing out more of the facts about our product.

Unique Marketing Strategy

“1CARD, 1 Solution.” Simply, convenience is one of the top priorities for consumers to achieve in any purchase they make. By building a market through mass advertising, we will create a market that will leave the five major credit card companies no choice but to satisfy their customers and license the “1CARD.” For a small fee you can provide your customers with ease and convenience.

Viral Marketing Strategy

The pre-launch viral marketing strategy best for our product would be to obtain the customers interest in our idea through our various advertising strategies, to then have those customers spread the word of the convenience of our product through word of mouth, which would then in return credit a demand for our service and entice the credit card companies.

Marketing Post-Launch

Market Segmentation

After successfully reaching our goal of obtaining the five major credit card companies, we believe that retailers, restaurants, gas stations, and others who offer some form of loyalty points or rewards to their customers will find the 1CARD a necessity and be part of our post-launch target market. Whether you are a retailer offering your own credit card or you are a company that offers gift cards, you will want to allow your customers the convenience of accepting these forms of cards and transferring them over to the 1CARD. Since we already have the major credit card brands, obtaining the other sectors of the crediting industry will become simpler as the customer will create a demand that the creditors will want to meet to keep their customers satisfied.

Marketing Strategy

Our strategy will be slightly different than our pre-launch strategy as we plan to market to a broader market. By reaching out to different retailers, restaurants, gas stations and other major companies, we will continue to retain our 1/3 of a cent charge. For example, retail companies would allow their customers the convenience of not having to worry about losing gift cards they receive as presents on holidays or special occasions because customers would be able to transfer this information onto the 1CARD. Peace of mind is something a customer wants and needs assurance of and what better way to do so then offering a service that will allow their customers convenience and the ability to lessen the burden on their wallet. Furthermore, credit cards are a major form of a tender for a transaction and through our service, the industry will prosper and become even more efficient.

Traditional Marketing Strategy

Our traditional strategy is to present our idea in a press conference with the major credit card companies, retailers, restaurants, gas stations, and other major companies. Since we have an idea and want to obtain business from major credit card companies and various markets, we believe that the best way to reach out would be to present the facts and why our idea and product will benefit each company, which is mainly based on the convenience aspect. Furthermore, we would continue to advertise through magazines, newspapers, and direct mail. The release of our webpage would allow customers to track their transactions and check their balances on their gift cards and their points they have earned on their loyalty cards.

Unique Marketing Strategy

““Transfer all of your cards into one: Introducing the 1CARD, the one solution for managing your wallet.” The ability to use the 1CARD is a convenience rather than a benefit because it allows creditors to allow their customers the convenience of carrying 1CARD rather than having a completely overflowing wallet. Furthermore, you can allow your customers to never worry about losing gift cards or forgetting the balances on their accounts as it will be available through our webpage.

Viral Marketing Strategy

With the release of our webpage, we will allow customers access to certain account information. We will have a field box in which you can forward the webpage address and 1CARD information to family, friends, and colleagues so that we can continue to create a larger market for our service. Additionally, we will allow our customers to add our slogan to the bottom of their email if they chose. This will benefit customers as it will allow them to be proud users of our service and show their support and will also provide a link that will allow others to join our site and learn about our services. It will be a new and unique service that everyone will want because convenience is part of everyone’s goals in whatever they do.

Sales Pre-Launch

Direct Method

Unlike many firms that chose to sell directly to consumers, we plan to sell directly to the five major credit card companies: American Express, Discover, Diner’s Club International, Master Card, and Visa. We believe by implementing the disintermediation process, we will be able to sell directly to major credit card companies that will allow us to later obtain a larger market which will consist of retailers, restaurants, gas stations, and similar markets.

Distribution Channel

In the pre-launch, 1CARD will be distributed to the five major credit card companies: American Express, Discover, Diner’s Club International, Master Card, and Visa. Our distribution channel is very unique as it is only geared to a specific market.

Sales Post-Launch

Direct Method

Our direct method approach will still be directed to businesses. However, we will additionally contact retailers, restaurants, gas stations, and similar vendors. Also, we will approach the consumer market using credit card companies and similar vendors as the intermediaries.

Distribution Channel

The post-launch distribution channel will differ from the pre-launch distribution channel as 1CARD will be distributed to a wider range of vendors who will also act as intermediaries between consumers. However, we will still have control in being able to market and advertise so to customers so that the market is not minimized in any way.

Financial Pro-Forma

Unit Cost Build-up and Financial Rule Model

Unit Cost/Price Build-up	Financial Rule Model
Unit Price (per transaction)	$0.0033	100.00%
Unit Cost (per transaction, estimated at 645,000,000 transactions)	$0.00041	12.42%
Gross Profit	$0.00289	87.57%
Budget	($0.00239)	72.42%
Operating expense (per unit)	$0.00141		42.72%
General Admin. expense	$0.000981		29.72%
NPBT	$0.00091	27.57%

Price and Profitability Assumptions:

Pricing Structure:

1CARD has decided to set the price of our licensing fee on a per transaction basis for every transaction regardless of customer type. The fee will incur to the five major credit card companies. A flat rate of $0.0033 (1/3 of a cent) was set as the level of convenience to the credit card companies and to maximize the profit of 1CARD.

Cost of Service Provided Assumptions:

1CARD is a product currently under development that can be used to store multiple cards in a one convenient card. We will be targeting major credit card companies in order for people to use the convenience card. Start-up costs are the primary costs associated with delivering this product. Other major costs associated with this product are prototype cost, engineering, tech. cost, and consultation cost.

Start-up Capital Requirements

1CARD. Pro-Forma 03/13/08
	STARTUP REQUIREMENTS
	Description	Cost
	LEGAL & CONSULTING	$25,000.00
	ENGINEERING	$100,000.00
	PREPAID LEASE	$10,000.00
	PROTOTYPE	$50,000.00
	TECH. CONSULTATION	$75,000.00
	COMPUTER EQUIPMENT	$5,000.00
	TOTAL EST. COST	$265,000.00
	AMORTIZE START-UP 18 MOS	$14,722.22	ProForma1		$14,722.22	STARTUP AMORTIZED 18MOS.
					$116,248.89	LOSS AFTER 3 MOS
	ADDITIONAL WKG CAP	$11,301.98			$29,062.22	DIVIDED BY 4
					$203,435.56	MULTIPLIED BY 7
	TOTAL AMORTIZED PER MONTH	$26,024.20	ProForma2		$11,301.98	DIVIDED BY 18

Start-up Capital Requirements Assumptions:

(1) Legal fees include licensing and incorporation as well as attorney fees to set up the product.

(2) Fees to develop the necessary mechanics of the product

(3) Fee to cover the cost of a physical concept product

(4) Software fees needed to incorporate the product into a current existing infrastructure.

18-month Profit and Loss Statement

1CARD Pro-Forma 3/13/08
		MAR	APR	MAY	JUNE	JULY	AUG
SALES FORECAST		0	3,500,000	5,000,000	7,500,000	10,000,000	15,000,000
REVENUE		$0.00	$11,550.00	$16,500.00	$24,750.00	$33,000.00	$49,500.00
COGS		0	$2,310.00	$3,300.00	$4,950.00	$6,600.00	$9,900.00
GP		0	$9,240.00	$13,200.00	$19,800.00	$26,400.00	$39,600.00
OPERATING EXPENSES
S&M
ADVERTISING		10000	10000	10000	0	0	10000
LABOR F/T		5000	5000	5000	5000	5000	5000
T&E		2500	2500	2500	2500	2500	2500
TEL		250	250	250	250	250	250
MISC		1000	1000	1000	1000	1000	1000
TOTAL		18750	18750	18750	8750	8750	18750
G&A
INS		250	250	250	250	250	250
UTIL		200	200	200	200	200	200
TEL		200	200	200	200	200	200
T&E		250	250	250	250	250	250
EQUIP		500	500	500	500	500	500
LABOR F/T		4000	4000	4000	4000	4000	4000
LABOR P/T		2500	2500	2500	2500	2500	2500
SUPPLIES		250	250	250	250	250	250
MISC		500	500	500	500	500	500
AMORTIZED START COST		$26,024.20	$26,024.20	$26,024.20	$26,024.20	$26,024.20	$26,024.20
TOTAL G&A		$34,674.20	$34,674.20	$34,674.20	$34,674.20	$34,674.20	$34,674.20
TOTAL OPERATING EXP		$53,424.20	$53,424.20	$53,424.20	$43,424.20	$43,424.20	$53,424.20
NPBT		-$53,424.20	-$44,184.20	-$40,224.20	-$23,624.20	-$17,024.20	-$13,824.20
ACCUM			-$97,608.40	-$137,832.59	-$161,456.79	-$178,480.99	-$192,305.19

1CARD Pro-Forma 3/13/08
		SEPT	OCT	NOV	DEC	JAN	FEB	MAR
SALES FORECAST		22,500,000	27,500,000	35,000,000	50,000,000	50,000,000	50,000,000	50,000,000
REVENUE		$74,250.00	$90,750.00	$115,500.00	$165,000.00	$165,000.00	$165,000.00	$165,000.00
COGS		$14,850.00	$18,150.00	$23,100.00	$33,000.00	$33,000.00	$33,000.00	$33,000.00
GP		$59,400.00	$72,600.00	$92,400.00	$132,000.00	$132,000.00	$132,000.00	$132,000.00
OPERATING EXPENSES
S&M
ADVERTISING		10000	10000	0	0	10000	10000	10000
LABOR F/T		5000	5000	5000	5000	5000	5000	5000
T&E		2000	2000	2000	2000	2000	2000	2000
TEL		250	250	250	250	250	250	250
MISC		1000	1000	1000	1000	1000	1000	1000
TOTAL		18250	18250	8250	8250	18250	18250	18250
G&A
INS		250	250	250	250	250	250	250
UTIL		200	200	200	200	200	200	200
TEL		200	200	200	200	200	200	200
T&E		250	250	250	250	250	250	250
EQUIP		500	500	500	500	500	500	500
LABOR F/T		4000	4000	4000	4000	4000	4000	4000
LABOR P/T		2500	2500	2500	2500	2500	2500	2500
SUPPLIES		250	250	250	250	250	250	250
MISC		500	500	500	500	500	500	500
AMORTIZED START COST		$26,024.20	$26,024.20	$26,024.20	$26,024.20	$26,024.20	$26,024.20	$26,024.20
TOTAL G&A		$34,674.20	$34,674.20	$34,674.20	$34,674.20	$34,674.20	$34,674.20	$34,674.20
TOTAL OPERATING EXP		$52,924.20	$52,924.20	$42,924.20	$42,924.20	$52,924.20	$52,924.20	$52,924.20
NPBT		$6,475.80	$19,675.80	$49,475.80	$89,075.80	$79,075.80	$79,075.80	$79,075.80
ACCUM		-$185,829.38	-$166,153.58	-$116,677.78	-$27,601.98	$51,473.83	$130,549.63	$209,625.43

1CARD Pro-Forma 3/13/08
		APR	MAY	JUN	JULY	AUG	SEPT	TOTAL
SALES FORECAST		50,000,000	50,000,000	50,000,000	51,500,000	57,500,000	60,000,000	645,000,000
REVENUE		$165,000.00	$165,000.00	$165,000.00	$169,950.00	$189,750.00	$198,000.00	$2,128,500.00
COGS		$33,000.00	$33,000.00	$33,000.00	$33,990.00	$37,950.00	$39,600.00	$425,700.00
GP		$132,000.00	$132,000.00	$132,000.00	$135,960.00	$151,800.00	$158,400.00	$1,702,800.00
OPERATING EXPENSES
S&M
ADVERTISING		0	0	10000	10000	10000	0	$120,000.00
LABOR F/T		5000	5000	5000	5000	5000	5000	$95,000.00
T&E		2000	2000	2000	2000	2000	2000	$41,000.00
TEL		250	250	250	250	250	250	$4,750.00
MISC		1000	1000	1000	1000	1000	1000	$19,000.00
TOTAL		8250	8250	18250	18250	18250	8250	$279,750.00
G&A
INS		250	250	250	250	250	250	$4,750.00
UTIL		200	200	200	200	200	200	$3,800.00
TEL		200	200	200	200	200	200	$3,800.00
T&E		250	250	250	250	250	250	$4,750.00
EQUIP		500	500	500	500	500	500	$9,500.00
LABOR F/T		4000	4000	4000	4000	4000	4000	$76,000.00
LABOR P/T		2500	2500	2500	2500	2500	2500	$47,500.00
SUPPLIES		250	250	250	250	250	250	$4,750.00
MISC		500	500	500	500	500	500	$9,500.00
AMORTIZED START COST		$26,024.20	$26,024.20	$26,024.20	$26,024.20	$26,024.20	$0.00	$468,435.56
TOTAL G&A		$34,674.20	$34,674.20	$34,674.20	$34,674.20	$34,674.20	$8,650.00	$632,785.56
TOTAL OPERATING EXP		$42,924.20	$42,924.20	$52,924.20	$52,924.20	$52,924.20	$16,900.00	$912,535.56
NPBT		$89,075.80	$89,075.80	$79,075.80	$83,035.80	$98,875.80	$141,500.00	$141,500.00
ACCUM		$298,701.23	$387,777.04	$466,852.84	$549,888.64	$648,764.44	$790,264.44	$790,264.44

Break-even Analysis

Net Profit Before Taxes

-100000

-50000

0

50000

100000

150000

200000

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NPBT

ACCUMULATED NET PROFIT/BREAK EVEN

-400000

-200000

0

200000

400000

600000

800000

1000000

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ACCUM

Figure is stating profit/loss for each month.

NOTE: Month starting January.

Analysis:

Given that our business is making a technological innovation and selling our physical product to credit card companies, we, in-turn, receive royalty per transaction. Our break-even analysis assumes that all costs associated with this product are at fixed level. Our projected revenue and expenses will have us break-even at or around the 11th month. Approximate revenue at 11th month will be totaling $165,000 or approximately 50,000,000 credit card transactions. This number breaks downs to about 10,000,000 transactions per credit card Company (assuming five major credit cards).

NOTE: 50,000,000 transactions for one month represents about 3.63% of all monthly transactions completed in the United States.

Summary

Sustainability

It is evident from exhaustive research that this product can survive and grow in the marketplace. Upon industry, competitor, and market segment analyses, it has become clear that we have developed a not only viable, but highly profitable product that will allow us to thrive. Key supporting evidence is that 1CARD does not focus on a niche market or a narrow segment, but rather applies to any and every consumer. Research has shown that there is an apparent trend towards the use of credit, and the growth of this trend will be highly correlated with 1CARD’s success.

We feel that our product will be demanded by consumers of all markets and segments, and we stand to become a permanent fixture in the marketplace. Raised future growth expectations and aggressive marketing campaigns will fuel this growth.

1CARD has not only the ability to sustain, but also to scale. Initial costs are significant, but they stand to be absorbed as time goes on. Our business model allows for increased future revenues to cost less to deliver than current revenues, and our profit margins will therefore increase as sales progress over time. We firmly believe that we have developed a product where demand will grow progressively and this demand will continually drive revenues higher.

Profitability

Based on the financials set forth in this analysis, 1CARD will break even within the first year. Therefore, we stand to turn a profit within the first year, and the business stands to profit aggressively after that. Once the startup costs have been overcome, 1CARD sees significant profits immediately. As this business stands to see profitability within the first year, we feel we can stand behind a strong product with realistic goals of future growth.

We have set our initial market expectations as low, with respect to market share and licensing fees, so we can only go up from there. Though it is foreseeable that the customer may develop the ability to dictate price, our volume per customer can only increase. A long-term transaction goal will be significantly higher than one percent per credit card corporation.

We have shown that our business model can attain profitability in a very short time with overly cautious market estimates, and we can therefore foresee that with a greater share of the market we stand to be exponentially profitable. Our initial marketing strategies have laid forth several tactics that can be approached when seeking future growth. These are realistic targets that will expand our market share, and we can explore future possibilities as we grow.

Outlook

We see strong demand and sustainable growth for 1CARD, and we feel that we have a strong business plan that allows for future success and optimization. Based on the strength of initial financial models, we have reason to believe that this business has a strong inclination towards future growth.

We see advertising as a promising future revenue stream, and based on current market conditions, this stands to remain true.

We are fully prepared for future competition in that we have a solid product, and have become the market innovator and initiator. We see our product as surpassing any current competition, and also warding off future competition due to our strategic alliances with our major customers. We feel that 1CARD is an ideal product for current and future marketplaces worldwide and that this company stands to generate significant revenue.

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� http://www.lectlaw.com/files/inp03.htm

� http://www.marketresearch.com/map/research/credit_cards/426.html

� http://www.ita.doc.gov/td/finance/publications/creditcards.pdf