doğuş medikal tic. ve san. ltd. Şti. business p lan · figure 1 selection of role model...

Technical Assistance for the Operation of Samsun

Metal Metrology and Calibration Laboratory

Contract No: EUROPEAID/133364/IH/SER/TR

Doğuş Medikal Tic. Ve San. Ltd. Şti.

Business P lan

October 2016

This project is co-funded by

the European Union and the Republic of Turkey

DISCLAIMER

This document has been produced with the technical assistance of the European Union under

“Technical Assistance for the Operation of Samsun Metals Metrology and Calibration Laboratory

Project, Turkey, Service Contract Number: EUROPEAID/133364/IH/SER”. The contents of this

publication are the sole responsibility of Archidata Danışmanlık Hizmetleri A.Ş. in consortium with

COSMOB S.p.A, ECOTER S.R.L and Archidata S.R.L and can in no way taken as the view of the

European Union and the Ministry of Science, Industry and Technology of the Republic of Turkey.

Tables

Table 1 Company profile ......................................................................................................................... 8

Table 2 Analysis of the products............................................................................................................ 14

Table 3 Global trade figures for hearing aids (thousand USD) .............................................................. 15

Table 4 Countries having highest import figures for hearing aids (thousand USD) .............................. 16

Table 5 The highest export markets of Turkey for hearing aids (Thousand USD) ................................ 17

Table 6 Supports by source ................................................................................................................... 18

Table 7 Supports by kind and value ....................................................................................................... 19

Table 8 Competitors by product type.................................................................................................... 26

Table 9 Criteria for competitiveness ..................................................................................................... 28

Table 10 Estimated sales figures ........................................................................................................... 30

Table 11 Sales prices and market prices (TL) ......................................................................................... 32

Table 12 Advertisement tools ............................................................................................................... 35

Table 13 Raw materials procurement conditions ................................................................................. 36

Table 14 Qualification of the employees ............................................................................................... 39

Table 15 Balance sheet (Assets) ............................................................................................................ 43

Table 16 Balance sheet (Liabilities) ....................................................................................................... 45

Table 17 Income statement ................................................................................................................... 46

Table 18 Basic financial figures.............................................................................................................. 47

Table 19 Financial Ratios ....................................................................................................................... 48

Table 20 Sales plan ................................................................................................................................ 49

Graphs

Graph 1 Share ratios ................................................................................................................................ 9

Graph 2 Countries having highest exports of hearing aids in the World .............................................. 15

Graph 3 Countries having highest imports of hearing aids in the world ............................................... 16

Graph 4 Number of company products ................................................................................................. 17

Graph 5 Distribution of domestic sales ................................................................................................. 21

Graph 6 Domestic sales figures during last 3 years (TL) ........................................................................ 21

Graph 7 Export sales during last three years (TL) .................................................................................. 22

Graph 8 Total sales figures during last three years (TL) ........................................................................ 22

Graph 9 Distribution of total sales ........................................................................................................ 22

Graph 10 Problems faced during exporting .......................................................................................... 23

Graph 11 Sales terms ............................................................................................................................. 32

Graph 12 Market reaching methods ..................................................................................................... 33

Graph 13 Capacity utilisation rate ......................................................................................................... 36

Graph 14 Distribution of employees ..................................................................................................... 38

Graph 15 Qualification of the employees ............................................................................................. 38

Graph 16 Profit and loss ........................................................................................................................ 47

Graph 17 Sales income by years ............................................................................................................ 49

Figures

Figure 1 Selection of role model enterprises ........................................................................................ 10

Figure 2 Obstacles avoid innovation ..................................................................................................... 18

Figure 3 Certificates received ................................................................................................................ 20

Figure 4 Location of present and target export markets ...................................................................... 24

Figure 5 Distribution channels ............................................................................................................... 34

Figure 6 Location of present assets ....................................................................................................... 34

Figure 7 Raw materials procurement channel ...................................................................................... 37

TABLE of CONTENTS

1. EXECUTIVE SUMMARY OF THE BUSINESS PLAN .............................................................................. 9

1.1 Purpose of the Business Plan ....................................................................................................... 9

1.2 Brief Descriptions on Products and Markets………………………………………………………………………….10

2. COMPANY PROFILE ...................................................................................................................... 12

2.1 Company History ....................................................................................................................... 12

2.2 Remarkable Past Accomplishments Along With Their Consequences ...................................... 12

2.3 Mission ...................................................................................................................................... 12

2.4 Vision ......................................................................................................................................... 13

2.5 Targets ....................................................................................................................................... 13

3. PRODUCT / SERVICE DESCRIPTION .............................................................................................. 14

3.1 Detailed Product / Service Description ..................................................................................... 14

3.2 Product / Service Advantages .................................................................................................... 18

3.2.1 Innovations ................................................................................................................................ 18

3.2.2 Quality level ............................................................................................................................... 20

3.3 Sectoral, National and International Standards for the Products / Services ............................. 20

4. MARKET ANALYSIS AND MARKETING METHOD ........................................................................... 21

4.1 Market at Present and Target Markets in the Short, Medium and Long Run ........................... 21

4.2 Customer Groups at Present and Targets ................................................................................. 24

4.3 Measures for Competition ........................................................................................................ 25

4.3.1 Strengths and Weaknesses and Planned measures against Competitors ................................. 25

4.3.2 Sectoral developments, Opportunities, Threats and Planned Measures .................................. 28

4.4 Estimated Sales Plan .................................................................................................................. 30

4.5 Product / Service Sales Policy .................................................................................................... 32

4.5.1 Sales Prices ................................................................................................................................ 32

4.5.2 Pricing Methods ......................................................................................................................... 32

4.6 Methods of Introducing the Product / Service to the Target Groups ....................................... 33

4.6.1 Marketing Strategies ................................................................................................................. 33

4.6.2 Distribution / Communication Channels .................................................................................. 34

4.7 Location ..................................................................................................................................... 34

4.8 Advertisement / Promotion Activities ....................................................................................... 35

4.8.1 Target groups of the Advertisement / Promotional Activities .................................................. 35

4.8.2 “Advertising Tools ...................................................................................................................... 35

6

5. PRODUCT / SERVICE PLAN ............................................................................................................. 36

5.1 Workflow and Production Planning for the Product / Service .................................................. 36

5.2 Capacity Utilisation Rate ........................................................................................................... 36

5.3 Raw materials and Other Inputs Necessary for the Product / Service ...................................... 37

6. ORGANISATION AND MANAGEMENT PLAN .................................................................................. 38

6.1 Organisational Structure ........................................................................................................... 38

6.2 Labour force at present ............................................................................................................. 38

6.3 Relevant Qualifications Necessary for Producing the Goods / Services .................................... 39

6.4 Defining Duties, Authorities and Responsibilities ..................................................................... 39

6.5 Employee Performance Evaluation Criteria .............................................................................. 42

7. FINANCIAL MANAGEMENT ............................................................................................................ 42

8. APPENDIX ...................................................................................................................................... 49

Technical Assistance for the Operation of Samsun Metals Metrology and Calibration Laboratory Archidata Danışmanlık. Hizmetleri. A.Ş in consortium with COSMOB S.p.A, ECOTER S.R.L and Archidata S.R.L

Table 1 Company profile

Brief Profile

Name of the Company: Doğuş Medikal Ticaret ve Sanayi Limited Şirketi

Authorised person: Erol Acer

Title of the Authorised Person:

Company Manager

Address: Kale Mahallesi Osmaniye Caddesi Belediye Merkez Çarşısı 8/1 - Samsun

Telephone: +90 (362) 431 57 58

Fax: +90 (362) 431 73 35

E-mail Address: [email protected] - [email protected]

Web Site: www.dogusmedikal.com.tr - www.loreca

Year of Establishment: 18.08.1994

Trade Registry Number:

15897

Chamber Registry Number:

17808

Tax Office: Samsun Gaziler

Tax Office Number: 3090029313

NACE Code: 26.60.01

Area of Activity: Production and marketing of hearing aids, sound proof cabins, comparative hearing aid selection device, self service hearing test devices

Number of Trademarks:

1

Partnership Structure

Name of the Shareholder Amount of Share in TL Percentage

Erol ACER 29,900 TL 99.67%

Esra ACER 100 TL 0.33%

Toplam TL 100%

mailto:[email protected]

mailto:[email protected]

http://www.dogusmedikal.com.tr/

http://www.loreca.com/


Graph 1 Share ratios

1. EXECUTIVE SUMMARY OF THE BUSINESS PLAN

1.1 Purpose of the Business Plan

This Business Plan has been prepared under the Project “Technical Assistance for the Operation of

Samsun Metal Metrology and Calibration Laboratory” aiming to strengthen the innovation and quality

infrastructure of the metal processing sector in TR83 Region (Samsun, Amasya, Çorum, Tokat) and

Sinop provinces. The Project is co-financed by the European Union.

The laboratory is currently under construction in Samsun Organized Industrial Zone. It is planned to

provide technical support to the companies working in metal processing sector through the laboratory

which will have international accreditation.

One of the components of the Project is “Innovation Window”. Under this component 5 businesses

have been selected as role models. During selection process, preliminary screening has been carried out

with 80 companies from the Region and 25 potential companies have been identified. A survey has

been applied which has objective criteria such as growth capacity with laboratory support and design,

production, quality, export, finance and management capabilities. The experts have evaluated the

survey. Consequently five role model businesses have been selected. Visits are paid to businesses

selected as role models and in depth diagnostic study has been carried out. Thus, qualitative and

quantitative information has been gathered to be used in preparation of business plans.


Figure 1 Selection of role model enterprises

Doğuş Medical is one of the 5 role model companies. This business plan has been prepared by the

experts assigned under the Project utilising the findings of the diagnostic study. The business plan has

been finalised upon discussing with Doğuş Medical at a certain stage. The current situation of the

company has been explained under the headings of management, marketing, innovation,

competitiveness and financial standing within this framework. Proposals have been formed through

systematic and institutional approaches.

The purpose of this Business Plan is to enable the company management to re-consider the present and

future situation of the market and the company’s prospective situation. It is also aimed to gather

informaton about the new markets in which the company plans to expand its activities.The business

plan could be used for accessing financial resources and simultaneously be used during realisation of

the ideas, techniques and business processes developed with mutual undertstanding of the company

officials and experts. Implementing / realisation of all or part of the proposals made in this business

plan lies within the sole responsibility of Doğuş Medikal Ltd. Co.

1.2 Brief Descriptions on Products and Markets

The medical devices sector is a fast growing, dynamic sector in the World. Although its development

started late in Turkish economy, it is placed among strategically important sectors during recent years.

The sector has a large product range. The medical devices (excluding medicines) could be defined as

products to diagnose the diseases and heal human beings. About 500 thousand products from most

simple to most complicated, from the oldest to newest could be named as medical devices. From


bandages to advanced tomography devices, from surgery gloves to endoscopic robots numerous

products and related software are considered as medical devices. The fact that the products

subject to innovation and technological developments in other sectors could be utilized instantly, all

affect development of the sector.Medical devices sector together with medicines are indispensible

components of healthcare sector. As a result of developing medical technology, usage of medical devices

like medicines increased and caused rise in global healthcare expenditures. All countries take measures

to cut healthcare expenditures. It is foreseen that the expenditures arisen from usage of medicine and

medical devices continue to grow in coming years.

Public offices need to cover these expenses as they continue to give healthcare services.

Transferring from net importer status to net exporter status will be an important gain for the economy

in the long run.

Production of medical devices has limited with traditional technologies in our country. Production of

medical devices with high value added and using advanced technology such as biotechnology,

informatics, microelectromechanic and nanotechnology are limited.

There are structural obstacles in our production which prevent transfer from traditional technologies to

advanced technology.

Thirty companies share 89% of the global medical devices market. The rest 27,000 producers share

balance 11%. Under this competition, development of national medical technology could only be

possible when government’s taking initiative and collaborate with private sector.

Hearing loss is a common problem for many people. Its incidence increases depending age. Many of the

people above 65 and almost all of the people above 80 have hearing losses. Hearing aids help regaining

hearing ability.


2. COMPANY PROFILE

2.1 Company History

Doğuş Medical was established in Samsun in 1984. From that date on, it is involved in import,

export and sales of hearing aids. As a result of long term experience in the sector, it started to

produce its own hearing aid under the brand LORECa in 2009 and developed the software for this

product (Loreca Fittin Software). The company signed a mutual investment agreement for OEM1

production with major producers of the world in 2011. The company is the dealer of hearing aids of

various brands and markets cells, ringing sound devices, devices for talking. It also produces hearing

aids with labels (ITE, ITC, CIC) and back ear devices (BTE), digital and analogue hearing aids. Its

annual production capacity is 480 in the ear and 480 back of the ear devices (as per capacity report)

and uses 50% of its capacity.The sales figure of the company rose from 1 million TL in 2011 to 1.4

milion in 2015. The company effected export sales for 41,000 TL. The company is employing 11

staff.

The company serves to the whole country through its 25 dealers. The company started exports

under the brand LORECa to Africa, Middle East and Turkic Republics. CE certificate has been received

for LORECa brand goods. The company also received ISO 9001:2000 Quality and ISO 13485:2003

Quality Management System for Medical Devices certificates.

Service Qualification Certificates from TSE and Ministry of Science, Industry and Technology enables the company to give repair and maintenance services to the customers. Moreover through sponsorship to various health programmes, it raises awareness of the people and target groups. In Samsun hearing devices sales and application centre which has registered its brand in 2009 hearing devices of 4 separate brands, cells, ringing sound devices and devices for talking are sold.

2.2 Remarkable Past Accomplishments Along With Their Consequences

Doğuş Medical is the second company in Turkey which produced hearing aids. The company

produced its hearing aids under the brand LORECa.The company received Useful Model certificate (2009-06800) from Turkish Patent Office for self service hearing test device. This device enables people to do hearing tests by themselves. The kiosks run by payment of symbolic fares (1 TL) and the amounts collected in the devices are used for supplying hearing aids to the low income groups under the scheme of a social responsibility project.The company aims to produce mainboards for hearing aids and audiometers under the project named “Production of PCB2 mainboards with SMT3

Technology” submitted to Central Black Sea Development Agency (OKA)

2.3 Mission

The mission of Doğuş Medical is to meet the rising demand of the people having hearing loss as

the result of growing consciousness for using aids at present and in future; equipping the hospitals

with new model test cabins, thus contributing the development of health sector.

12


2.4 Vision

The vison of the company is to receive a considerable share from Turkish hearing aids market

expected to grow as the consciousness to use them increase. Increase competitiveness of our

country in medical devices sector by producing micro-chips currently imported and thus decrease

dependence of our country to other countries.

Doğuş Medical is steadily investing to high technology and R&D and in case government support is

given, Doğuş Medical will continue to take steps in the direction of its vision.

2.5 Targets

Market 480 LORECa in the ear and 480 LORECa back of the ear hearing aids

Continue marketing hearing aids of Siemens and other brands

Market new model sound proof cabins to hospitals and hearing aids sales centres

Start mass production of Audiometer devices

Do calibration of audiometers in use

Place self service hearing test automats to malls, bus stations and family health centres

Receive training on institutionalization and human resources

13


3. PRODUCT / SERVICE DESCRIPTION

3.1 Detailed Product / Service Description

Table 2 Analysis of the products

Product / service name and group

Quality level of product (Bad, Middle, Good,

Very good)

Area of Use

Markets

Shelf Life (Years)

Hearing Aids (8 models)

Medium Hearing aids sales and application centres

Turkey (55%), Export markets

(45%)

2

Audiometers (2 models)

Good Hospitals Turkey 2

Timpanometers (2 models)

Good Hospitals Turkey 2

Sound proof cabins

Good Hospitals, Hearing aids sales and

application centres

Turkey 2

Comparative Hearing Aid Selection Device (LO-PRO3)

Very good Hearing aids sales and application centres

Turkey 3

Siemens Hearing Aids (15 models)

Very good Hearing aids sales and application centres

Turkey 2

Self Service Hearing Test Device

Very good Used for promotion Turkey 2

Ear back hearing aid: Production of hearing aids having analogue and digital technology In the ear hearing aid: Production of small in the ear (ITE-ITC) hearing aids In the channel hearing aid: Production of full in the channel hearing aid

Production of ear molds: Individual ear molds production having Biopor, hard and soft types.Production of Safe for hearing aid to be used the in the ear: Produced 100 % by the company Self Service Hearing Test Automat: An automat for making individual hearing tests Self Service Hearing Aid cell automat: Cell sales automat for the hearing aids in shops.The company produces 8 models of hearing aids under its brand LORECa. Whenever compared with European and Japanese products, the quality is considered as middle. Audiometers, timpanometers and sound proof cabins are considered as “good”. Comparative hearing aid selection device (LO- PRO3), self service hearing test device and hearing aids of Siemens brand are considered as “very good”.Technological developments determine the activities to produce new products or improve present products.

Hearing aids go in HS 90.21.40 group.


Figures for the global trade of this group between 2011 and 2015 were given at below table.

Table 3 Global trade figures for hearing aids (thousand USD)

Explanation 2011 2012 2013 2014 2015

Global imports 3.444.800 3.554.120 3.851.635 3.735.949 3.707.113

Turkey’s imports

32.186 32.242 33.762 36.049 29.610

Turkey’s exports

1.557 851 858 1.395

1.836

The global import which totaled 3.4 billion dollars in 2011 increased by 7% during the period

between 2011 and 2015 and reached 3.7 billion dollars in 2015.

Turkey is a net importer in this product group. However import figures fell from 32.1 million dollars

in 2011 to 29.6 million dollars in 2015. On the other hand Turkey’s export figures have risen from 1.5

million dollars in 2011 to 1.8 million dollars in 2015. The increase is 17.9%.

Turkey has a small share in global export markets with 0.05% (five in ten thousand) in 2015 and

ranked 27th in the global exporters list4.

Graph 2 Countries having highest exports of hearing aids in the World

4 BM Comtrade İstatistikleri


The highest exporting 10 countries were listed above in the product group HS 90.21.40. Denmark is

the highest exporter in 2015 with 518 million dollars. The country realizes 14.9% of global exports.

China (11.1%), Switzerland (10.8%), Singapur (10.4%), U.S.A. (9.4%), U.K. (8.5%), Poland (7.1%),

Holland (5.3%), Australia (5.1%) and Germany (4.7%) follow Denmark. According to above figures,

these 10 countries realized 87.3% of the global hearing aids exports.

Graph 3 Countries having highest imports of hearing aids in the world

The graph of 10 highest importing countries of hearing aids in 2015, evidences that U.S.A. is the

highest importer with 1.1 billion dollars. U.S.A. realizes 40.7% of the global imports. Germany (14.4%)

U.K. (12.8%), France (7.3%), Holland (5.5%), Canada (4.9%), Japan (4.4%), Switzerland (3.4%),

Singapur (3.3%) and Australia (3.1%) follow U.S.A.

Table 4 Countries having highest import figures for hearing aids (thousand USD)

Name of the Country

2011

2012

2013

2014

2015 Change (2011- 2015)

Holland 69.121 85.964 58.787 118.762 149.770 116,7%

Switzerland 67.682 48.176 69.776 96.492 92.572 36,8%

U.S.A. 903.505 1.059.661 1.080.654 1.017.956 1.102.768 22,1%

U.K. 289.621 313.711 362.264 415.163 345.194 19,2%

Canada 121.780 131.872 129.309 132.892 133.845 9,9%

France 215.689 190.156 221.108 225.790 198.805 -7,8%

Japan 133.198 148.102 133.026 119.015 119.812 -10%

Germany 435.584 348.909 492.924 354.698 390.724 -10,3%

Australia 96.524 86.481 97.733 70.590 84.479 -12,5%

Singapur 138.060 159.293 150.662 112.856 88.905 -35,6%


Analysis of the import figures of the highest importing countries between 2011 and 2015 evidences

that Holland has the highest increase rate with 116.7%. Switzerland, U.S.A., U.K. and Canada

followed Holland. Negative change has been observed in other countries.

Table 5 The highest export markets of Turkey for hearing aids (Thousand USD)

Name of the Country

2011 2012 2013 2014 2015

Switzerland 0 0 0 924 1.406

U.S.A. 0 366 493 0 205

Free zones 0 0 0 37 87

Denmark 17 22 38 0 51

Vietnam 0 0 0 3 24

Bulgaria 0 0 0 0 23

China 0 0 0 10 11

Algeria 0 0 0 0 7

Greece 0 0 69 37 6

Senegal 0 0 0 161 6

As it seen from the above table, Turkey with 0.05% has a very small share in world’s total hearing

aids exports. Switzerland and U.S.A. are the countries which Turkey exports most. Expecially there is

considerable export to Switzerland in 2014 and 2015.

The analysis of the export figures between 2011 and 2015 shows that export to most countries

started in 2014 and 2015, excluding U.S.A., Denmark and Greece.

Graph 4 Number of company products


The company presents several alternative brands and models to its customers. Its brand LORECa has

8 different models.

3.2 Product / Service Advantages

3.2.1 Innovations

Figure 2 Obstacles avoid innovation

The obstacles avoid innovation are mainly finance, then inadequacy of qualified human resources

and insufficiency of physical infrastructure. Doğuş Medical, applied public and EU funds to solve

finance problems.

Table 6 Supports by source

Supports by Source Nr

EU 1

Ministry of Economics 0

Ministry of Science, Industry and Technology 0

Regional Development Agency 1

KOSGEB 1

İŞKUR 0

TUBİTAK 0

Other 0


Table 7 Supports by kind and value

The company may apply support programmes run by other institutions. These programmmes are:

1) Ministry of

Science, Industry and

Technology supports:

Under Investment

Support Programme for

Technologically

Advanced Products,

SMEs receive support for procuring new machinery and equipment, interest repayment for

the loans and operational expenses. Under this programme small sized firms could receive

support up to 10 million TL.

- For procuring domestic machinery and equipment the company receives upto 50 %. (For

imported machinery it is 40%)

- The company will receive %75 of the annual rent, energy expenses and salary of the staff

(calculated over legal minimum wage)

2) The Scientific and Technological Research Council of Turkey (TUBİTAK) Grants Programme

These programmes are;

- SME Research, Development and Innovation Grant Programme: First 3 projects prepared by a

SME will be supported on following topics:

- introducing a new product

- developing or improving an existing product

- improving quality or standard of a product

- developing new techniques or production technologies to decrease costs

The maximum amount for the Project budgets is 500.000 TL, and 75% of the budget is supported.

TUBITAK – Industry R&D Projects Support Programme: Basic rate for the support is 40% of the

Project budget. This rate could be increased to 60%. Maximum duration of the project is 36 months.

Following expenses are supported under this programme:

- Salary costs

Type of support Nr. Amount

Capacity dev./Infrastructure support (Procuring machinery)

1 400.000

Trade fair support 0 0

International market research support 0 0

Catalog / Brochure support 0 0

Training support 0 0

Qualified personnel / On-the- job training support

1 0

R&D 1 55.000

Product development 1 0

Matching support 0 0

Loan support 0 0

Others 0 0

20

- Travel expenses

- Equipment, tool or software procurement costs

- Materails and Consumables costs

- National or international consultancy service costs

- R&D costs for the orders given to national universities, TUBITAK R&D Department or private

sector R&D units

3.2.2 Quality level

The company received ISO 9001 Quality Management System and Turkish Standards Institute (TSE)

Quality certificates.

Figure 3 Certificates received

3.3 Sectoral, National and International Standards for the Products / Services

The licences from Ministry of Health and TSE certificate have to be taken in order to market hearing

aids in the domestic market. CE certificates are accepted by public authorities. Receving ISO quality

certificates facilitate marketing.

21


4. MARKET ANALYSIS AND MARKETING METHOD

4.1 Market at Present and Target Markets in the Short, Medium and Long Run

Graph 5 Distribution of domestic sales

The products are sold mainly at local market. The reason for this is application of hearing tests and

proposing suitable devices to the patients at the office. The company sells Siemens brand hearing

aids besides its own products. Contacts established with Audiology departments of the hospitals

support this success. An upward trend could be seen as domestic sales figures were checked. The

annual sales figure for 2013 was 1.2 million TL, same in 2014, however increased to 1.3 million in

2015. According to these figures, sales increased by 12% in 2015 compared to 2013.

Graph 6 Domestic sales figures during last 3 years (TL)

22


Graph 7 Export sales during last three years (TL)

Graph 8 Total sales figures during last three years (TL)

23


Graph 9 Distribution of total sales

According to above figures, 94.74 % of the total sales were done to domestic markets and 5.26% of it

to export markets in 2015.

Graph 10 Problems faced during exporting

The main reason in exports is finance. In order to overcome this problem, the company may use

Eximbank loans.

24


Present and Target Markets

Present markets

Target markets

Figure 4 Location of present and target export markets

4.2 Customer Groups at Present and Targets

1,050 Hearing aids sales and application centres About 3,000 Hospitals throughout Turkey, 2,000 of them have audiology units 2,000 Medical devices trading companies

End users: Number of people having hearing loss in Turkey: about 2,5 million people Number of people having hearing loss in the world: about 250 million people

The most comprehensive research about people having hearing loss was done by Prime Ministry Office for Aiding Handicapped and State Statistics Institute in 2002. According to the Research for Handicapped in Turkey, the incidence of the people having most severe hearing loss was calculated as %0 37. At the time being 47,000 children having hearing loss are at the age of going primary and high schools. If another 27,000 youngster between 20-29 ages included, totally 75,000 children and youngster are in need of receiving education and vocational education. According to this data, number of people with severe hearing losses and in need of hearing aids and other services could be calculated as 259,000 people in our country.

25


According to World Health Organisation (WHO) data, there are 250 million people in the world having hearing loss. Number of people using hearing aids sums about 32 million. The number of hearing aids sold in 2002 was only 6 million. Although there is a need for 32 million devices annually, only 6 million could be produced. Totally 70% of the devices were sold to developing countries. Although there are 28 million people with hearing loss in America, only 23% of them have devices. Number of people between age group 18-80 having hearing loss above 25dB is estimated around 71 million in Europe and 35 million in North America. Another survey which put forwards similar results is EU’s “Evaluating social and economic cost of the hearing impaired”. According to this survey number of people having hearing loss sums up more than 55 million. This situation is similar in our country as well.

There are 3,000 thousand hospitals in our country and 2,000 of them have audiology units. Most of the units are old type and have to be replaced. New audiology units in hospitals are equipped with modern types. However, since these units are imported and expensive, several hospitals couldn’t procure them although needed. In case these devices namely audiometers and timpanometers were procured, defects arisen from usage couldn’t be repaired. Several devices left idle because of simple defects or lack of spare parts.

Audiology units are in need of sound proof cabins. Those old types made up of wooden materials have to be replaced with new model metal cabins.

Moreover the devices in the hospitals have to be calibrated annually. Calibration costs amount to 1,500 – 2,000 TL annually and makes high sums in total.

There are 1,050 hearing aids sales and application centres in Turkey which received licences from

Ministry of Health. According to the recent change in the regulations, they have to buy test devices.

4.3 Measures for Competition

4.3.1 Strengths and Weaknesses and Planned measures against

Competitors

STRENGTHS

Product prices are competitive

A new test device branded LO-PRO3 and self service test device have been marketed

Audiometers and timpanometers are produced by the company

The company has important sectoral information (know-how)

Presence of CRM system

26

WEAKNESSES

They are in need of support for innovation and financial management

Most of the sales revenue is spent for R&D expenses and there are commercialisation

problems

Brand awareness of global brands such as Siemens is high

Inability to establish branches in domestic market, they are marketing through dealers

Comparative hearing aid selection device (LO-PRO3) and self service hearing test devices are

innovative products of the company. These devices make the firm be distinguished in the sector.

Another strength of the firm is the presence and usage of a CRM system. There are about 20,000

customers registered in data base.

Table 8 Competitors by product type

Competitors Market share Location

Doğuş Medikal Ltd Şti. 1% Samsun

Siemens 65% Germany

Phonak 10% Germany

Widex 10% Denmark

Earnet 10% İstanbul

Others 4%

Main producers:

Siemens:

Siemens is working on hearing aids technology for 130 years. The company produced first hearing

aids in series in 1913. It prepared the first hearing aid small enough to enter pockets in 1951. It

marketed the first ear back (BTE) hearing device in 1959 and first digital device with dual

microphones in 1997. They are marketing more than 30 countries worldwide.

Phonak:

The company is working on hearing technology for 70 years. The company was established by a

group of French-Belgian investors in Zurich in 1947. The first international Phonak marketing

company was established in 1978 in Germany and France. The U.S.A. affiliate was established in

1989. The plant in Suzhou/China was opened in 2003 and the plant in Ho Chi Minh/Vietnam was

opened in 2007. Phonak Acoustis Implants was established in Lousanne/Switzerland to develop

middle ear implants. In 2011 the company introduced the first hearing aid, Lyric which could be used

up to 4 months without any interruption. This device, named as contact lens for the ears is placed

deep in the ear channel and could be used during sports activities, taking showers or while sleeping.

27


Widex:

The company is based in Denmark. They have a distributing company in Turkey. This company have

branches in Taksim and Kadıköy in İstanbul and in İzmir. Their devices have 9 models including one

for babies. The Unique model forces the limits of the sounds people could hear through aids. Dream

model enables hearing the sounds that couldn’t be heard previously. Clear model is a wireless device.

Super model is designed for people having severe hearing losses. The device has small sizes but

having strong loud speaker in the ear. Menu is a flexible hearing aid model. Vital is a new and easy to

use model. Baby 440 is a device designed for children. The device being small and easy to operate

enables children to hear voices vitally important during learning to speak.

Major competitors doing marketing only:

Duyumed

Duyumed is a company brings solution to hearing problems dealing only with hearing aids and audiology.

The branches are located in Şişli (central), Kadıköy, Göztepe, Pendik, Ümraniye, Sultanbeyli, Gaziosmanpaşa, Karayolları/Gaziosmanpaşa, Bakırköy, Tuzla, İzmit/Kocaeli, Gebze/Kocaeli, Derince/Kocaeli, Alsancak/ İzmir.

The company has following quality certificates:

ISO 9001:2008 Quality management system ISO 10002:2004 Customer pleasure certificate ISO 20000:2005 Information technologies management system ISO 27001 Information safety management system OHSAS 18001:2007 Occupational health and safety system TSE Service Qualification certificate Licence from Ministry of Health

Brands distributed by Duyumed are:

Sonic Innovations:

The company was established in 1994 to develop technology for hearing aids producers. The company began to produce its own hearing devices in 1998 under its brand. The company is based in U.S.A. and has offices and plants throughout the world. Sonic Innovations and its partners applied hearing aids more than 1 millon people up to now.

Amplivox:

It is a British firm dealing with design and production of audiology equipments for 70 years. The company is located in Oxfordshire U.K. In the product line there are audiometers for scanning, diagnostics, clinics and industrial use, timpanometers and sound proof cabins.

28


MedRX: The company is located in U.S.A. and produces REM and HIT systems for hearing aids, computer aided audiometers and video autoscope systems for professionals.

Resonance: The company was established in 1995 and it is the brandname of the Italian medical appliance producer MRS. MRS is producing audiology equipments for important brands of the market under their brands in addition to Resonance. Quality of the goods, innovation, delivery on time and after sales services are most important factors regarding competitiveness. Other criteria such as price, procurement process and promotional activities are important for competitiveness as well. Expertise in product and diversity of products affect competition.

Table 9 Criteria for competitiveness

Degree of importance Criteria for Competitiveness

1 2 3 4 5

Price

Quality

Concentrate to single product /service

Product / service diversity

Innovation / Improvement in Technology

Delivery on time

Service support after sales

Procurement process

Promotion and advertisement

4.3.2 Sectoral developments, Opportunities, Threats and Planned Measures

OPPORTUNITIES

World population is increasing, number of people having hearing loss is increasing and the

societies become conscious about hearing problems.

The probability of getting affected from economic ups and downs is low since it is in health

sector.

Hearing aids having diverse prices cater to all income groups.

29


THREATS

Cheap and low quality goods create unfair competition.

There are no public supports for domestic products.

Entry of new competitors to the market is highly possible since profit ratio is high and the

sector is continuously growing

Increase in world population and number of people having hearing loss could be considered as an

opportunity. As an example there are about 1 million hearing aids sold annually in Germany which

has nearly same population with Turkey, whereas this figure is only 130,000 in Turkey.

The basic reasons for this difference are the low purchasing power in Turkish society and

unawareness about hearing loss problems. Hearing loss above 30 dB requires usage of hearing aids

however this fact is neglected. The patients aren’t told to use hearing aids during ear consultations as

much as required.

It is expected that there will be increase in usage of hearing aids in the future.

Hearing aids having diverse prices cater to all income groups.

As for threats;

Turkish Social Security Administration pays 550 TL as a contribution for each hearing aid. Price of

expensive devices start from 4,000 TL and goes up to 10,000 TL. The price of cheap ones is 1,000 TL.

Low income patients buy cheap ones as a necessity.

Against competition of the cheap and low quality products, the firm will make the patients to use

Lipro Audiometer device and compare performance of 12 different hearing aids. The patients could

detect the quality of the company goods. Moreover quality certificates will be shown to the patients.

At present there are 14 importers and 2 producers in Turkey. The volume of the market sums 150

million TL annually. Although the domestic producers pay 18% VAT for the parts, the importers bring

goods with VAT exemption. This situation creates a problem for the domestic producers in

competition. Social Security Administration doesn’t pay 15% premium for domestic products and this

is a problem for investors.

Entry of new competitors to the market is highly possible since profit ratio is high and the sector is

continuously growing. The company may not be affected much from this threat since it markets

world wide brands and its brand LORECa is recognized more day by day.

Technical Assistance for the Operation of Samsun Metals Metrology and Calibration Laboratory

30

Archidata Danışmanlık. Hizmetleri. A.Ş in consortium with COSMOB S.p.A, ECOTER S.R.L and Archidata S.R.L

4.4 Estimated Sales Plan

Table 10 Estimated sales figures

Product / Service

Sales at present (Unit)

1st

year 2nd

year 3rd

year 4th

year 5th

year

Explanation

Hearing aids

600

1.000

1.200

1.500

2.000

3.000

Hearing loss is increasing day by day and awareness of the people about hearing aids increase.

Audiometer Device

5

10

50

100

150

300

There is high demand from the hospitals. For the moment, old and big devices are used.

Timpanometer

5

10

50

100

150

300

There is high demand from the hospitals. For the moment, old and big devices are used.

Sound Proof cabins (Metal)

10

50

100

200

400

600

According to the regulations of Ministry of Health, old and wooden cabins should be replaced with metal ones in hospitals.

Comparative Hearing Aid Selecting Device (LO- PRO3)

2

50

100

200

400

600

According to regulations of Minstry of Health, hearing losses will be measured by LO-PRO3 device in hearing test centres in near future.

31

Siemens Hearing Aids

1.500

1.500

1.600

1.700

1.800

2.000

Hearing loss is increasing day by day and demand for hearing aids increase as well. As the number of hearing aids per population in EU and Turkey is compared, it is expected that domestic demand will increase in coming years.

Self Service 1 20 50 100 300 500 The firm plans to apply

Hearing Test Device

self service hearing tests free of payment as a social responsibility Project. After the tests, people having hearing losses are directed to hospitals and test centres. Through this practice awareness and sales figures will increase.

Total 2.123 2.640 3.150 3.900 5.200 7.300

The company expects increase in sales of all types during the next 5 years. The highest

increase is expected in sales of audiometers, timpanometers, sound proof cabins, comparative

hearing aids selection devices and self service test devices in which the company is ambitious.

LO-PRO3 comparative hearing aids selection device will be introduced in Hannover fair. It is

expected that orders from abroad will be received following introduction.

Self service Hearing Test devices are planned to be placed to Malls, bus stations and Family

Health Centres in the future.

32


4.5 Product / Service Sales Policy

4.5.1 Sales Prices

Table 11 Sales prices and market prices (TL)

Product name Unit price (2015)

Unit price (2016)

Lowest sales price in the market

Highest sales price in the market

Hearing Aids 1.000 1.750 750 8.000

Audiometer Device 13.000 13.000 10.000 40.000

Timpanometer 13.000 13.000 10.000 40.000

Sound proof Cabin (Metal)

7.500 8.000 7.500 40.000

Comparative Hearing Aid Selecting Device (LO-PRO3)

New product 4.500 - -

Siemens Hearing aids 1.000 1.750 1.000 8.000

Self Service Hearing Test Device

For advertisement

Average prices of the products are near to those having lowest price in the market. Demand of

the patients from middle income group aimed to be met through this policy.

4.5.2 Pricing Methods

List prices method is used during pricing.

Graph 11 Sales terms

33


The products are sold to the final users mainly against cash payment or credit cards. This situation

avoids any collection problem to emerge. However for sales to the dealers, partial advance and

balance against cheque/bills/ open account terms are utilized. Since the dealers have financial

standing and fulfilled their obligations previously, the collection problem is at a minimum.

4.6 Methods of Introducing the Product / Service to the Target Groups

4.6.1 Marketing Strategies

Graph 12 Market reaching methods

The patients are coming to the hearing aids sales office in Samsun, following doctor control. They are coming to buy a suitable device. Sales of hearing aids are done from the stocks. Cost of stocks is met from capital or from loans. The company keeps stocks average for 6 months.The company markets its own products from its sales office and through dealers. Advertisement is given to increase sales of the dealers.

34


4.6.2 Distribution / Communication Channels

Figure 5 Distribution channels

4.7 Location

Figure 6 Location of present assets

35


4.8 Advertisement / Promotion Activities

4.8.1 Target groups of the Advertisement / Promotional Activities

Advertisement and promotional activities are grouped under two headings, one for the patients

and other for the dealers. Catalogs and stands in trade fairs are directed to dealers and newspaper

ads and social media are used to increase brandname awareness among the consumers.

4.8.2 Advertising Tools

Table 12 Advertisement tools

Advertising Media Frequency Note

Catalog Annual Turkish and English

Newspaper Sometimes

TV Sometimes

Social Media Facebook, Youtube, Twitter, Linkedin, Google Plus

Fairs Sometimes

Website Continuously www.loreca.com www.dogusmedikal.com.tr

Catalogs which are used to promote the products are printed periodically. The company has a

website namely Loreca. English version of the promotional materials is available.

The company makes sales through alibaba.com occasionally.

The users have chance to make hearing tests for themselves in the web-site. Spreading this

information wil enhance awareness of the company.

As self service test device, informs the company about people having hearing problems, this enables

the company to access potential customers.

http://www.loreca.com/

http://www.dogusmedikal.com.tr/

36


5. PRODUCT / SERVICE PLAN

5.1 Workflow and Production Planning for the Product / Service

Workflow is not given by the company.

5.2 Capacity Utilisation Rate

Graph 13 Capacity utilisation rate

As awareness of the company products rise, it is expected that demand and consequently capacity

utilisation rate will increase.

Technical Assistance for the Operation of Samsun Metals Metrology and Calibration Laboratory Archidata Danışmanlık.Hizmetleri. A.Ş in consortium with COSMOB S.p.A, ECOTER S.R.L and Archidata S.R.L

5.3 Raw materials and Other Inputs Necessary for the Product / Service

Table 13 Raw materials procurement conditions

Name of the

Supplier

Location of the

Supplier

Name of the Raw material

Raw material/Product

Origin

Rate of cost of material in total raw

materials cost

Payment terms/

Maturity

Austar China Mainboard, Software, Spare

parts

China 45% Term

Lisaund China Microphone, Mainboard,

Receiver

China 15% Term

Knowles U.S.A. Mirophone, Receiver, Spare

parts

China 15% Cash

Sarnatec Germany Plastic box Germany 5% Term

Gennum- Intricon Onsemi

Israel Microchip Israel 5% Term

Foshon Vohom Tec. Co Ltd.

China Mainboard China 5% Term

Zenban International Ltd.

China China 5% Term

Other 5% Term

The company imports main parts used in production of hearing aids on term basis. If this situation is

compared with the sales terms of the company as it is mainly cash and balance deferred, it is an

advantage. It enables the firm to keep low level of working capital.

Figure 7 Raw materials procurement channel

38


6. ORGANISATION AND MANAGEMENT PLAN

6.1 Organisational Structure

Organisation chart was not provided by the company.

6.2 Labour force at present

Graph 14 Distribution of employees

Graph 15 Qualification of the employees

39


6.3 Relevant Qualifications Necessary for Producing the Goods / Services

Table 14 Qualification of the employees

Education Number of

people Rate to total number of

personnel

Vocational High school / University graduate

- -

Knowing foreign language 1 7,69%

Designer 1 7,69%

Engineer - -

Other 11 84,61%

6.4 Defining Duties, Authorities and Responsibilities

Position: Company Manager

Person whom he/she is responsible to: -

Nr Duties and Responsibilities

1. Identifying strategy, targets and policies of the company; providing necessary resources

(human, location, machinery/equipment, hardware and software) for attaining these

targets and make them used efficiently

2. Leading and controlling the activities done in order to realize these targets and policies

40

3. Act in line with company policies in all decisions taken

4. Enable smooth implementation and improvement of the processes related with Quality

Management System in order to maximize customer satisfaction

5. Lead and manage all employees in line with common goals of the company

6. Take measures for productivity and profitability of the company

7. Organize production, procurement and marketing activities

8. Manage, lead and support implementation, sustainability and improvement of Quality

Management System within the company

Position: Management Representative

Person whom he/she is responsible to: Company Manager


1. Act in line with the orders of the Company Manager and documents of the department

2. Identify and enable smooth implementation, sustainability and improvement of the

processes related with Quality Management System

3. Report to top management about performance and improvement of Quality

Management System

4. Pioneering the activities for understanding the customer needs and widespread this

understanding

5. Try to determine customer satisfaction through face to face contacts or phone calls or

surveys, act to strengthen the weak points of the company

6. In order to meet training needs, provide training resources, prepare training plans and

submit approval of the Company Manager

7. Plan and enable implementation of internal audit activities under Quality Management

System

8. Enable collection and keeping the quality records

9. Aid Company Manager in organisation of the review meetings of the management

10. Keep in contact with the Certification body, procurers and customers

40

Position: Procurement Responsible


Nor Duties and Responsibilities

1. Act in line with the orders of the Company Manager and documents of his/her

department

2. Evaluate the performance of the suppliers as defined which the factory procures raw

materials and auxiliary materials

3. Search the market for new procurers and suitable raw materials

4. Make the procurers be conscious about Quality Management System and carry out

activities with them to create mutual benefit

5. Inspect the raw materials and auxiliary materials ordered whether they fit the

requirements and give feed back the procurers when necessary

6. Prepare procurement contracts and make them applied

7. Contribute the activities in order to effect company policies and targets

Position: Sales and Marketing Responsible


No Duties and Responsibilities


department

2. Identify the customer demand, provide expectations of the customer well understood

and conveyed to the whole company

3. Work in coordination with the Sales Chief in order to meet the orders on time and as

demanded

4. Receive customer complaints, evaluate and give feed back to the customer

5. Search for new customers and markets, follow trade fairs etc. , carry out promotion

activities, advertisement and sponsorship


41

Position: Quality Control Responsible




department


3. Identify the missing machinery and equipment and make them supplied

Position: Production Responsbile




department


3. Ensure regular maintenance and smooth running of the machines

4. Take measures to increase production

5. Inform administrative units about production

6. Monitor the activities in production, transport and other departments according to the

work load

7. Monitor the weighing and Inform instant changes

8. Provide warehousing and placing of the goods done correctly

9. Control daily despatch forms

10. Identify the missing machinery and equipment and make them supplied

11. Provide keeping the records related with the department

42

Technical Assistance for the Operation of Samsun Metals Metrology and Calibration Laboratory Archidata Danışmanlık.Hizmetleri. A.Ş in consortium with COSMOB S.p.A, ECOTER S.R.L and Archidata

S.R.L

6.5 Employee Performance Evaluation Criteria

It was not provided by the company.

7. FINANCIAL MANAGEMENT

For implementation of a business plan study and system building for the 5 selected enterprises, which were already established and running for a considerable time periods, the following steps are considered to follow.

1. Assessing the current financial standings of the enterprise by the analysis of the official

financial reports submitted to related bodies covering the past three years of operations.

o Identifying the current financial performance o Designating operational success or failure points

2. Analysis of financial performance and needs for establishing a sustainable and healthy running enterprise

3. Determining prospective financial input needs 4. Preparation of the company’s income and expenditure statement based on experienced

estimations for the future five years.

o Income and expenditure statement o Cash flow calculations o Profitability calculations o Financial ratio calculations

Financial and Investment Plan: This allows the anticipation of short and medium-term financial modelling, action, strategies to get access to finance and manage finance, pricing strategy. The initial required investments defined, as well as costs and expenditures, cash flow, etc. financial projection and sustainability also elaborated under this section In this task, it is important to closely involve the enterprise in producing the business plans for defining the strategy, scope, targets and methodology for their businesses. As the Consultant, we plan to have a common agreement on the Business Plan template and to discuss and review the content and the viability of each plan. In this context, the company directors were invited to the TAT’s office to discuss developed draft business plan and the STEs conducted presentations about the missing financial and operational information. The benefit of business plan and the concept of financial analysis explained to the participants and a financial spreadsheet template shared with them. The business plan experts also communicated by phone calls and e-mails with the directors of the companies and sent detailed messages for the required information. The business plans developed with the ensured data and information by the companies. The spreadsheets developed as a tool especially to ease the processing of building and evaluating the financially estimated performance and outcomes. This system also provides great simplicity and ease for future additions, corrections and revisions. A copy of this spreadsheet is forwarded to the concerned personnel from the Company to fill in the estimated data and return to our TAT expert. It is advised by the TAT that the presented financial model can be developed by the role model companies during the monitoring period. With the aim of supporting role models to increase their production, innovation and competitiveness capacities, consultancy and advisory services will be delivered by the TAT to ensure effective implementation of their Business Plans.

43


Assessing the current situation:

Since Doğuş Ltd. Şti. is established and operating 1980 on, it is important to analyse the current

financial situation and performance first. An analysis could be made based on the officially submitted

financial data for the last three years. These data are submitted with below tables as year-end

balance sheet, income statement, cash-flow, key figures and performance tables.

Table 15 Balance sheet (Assets)

DOĞUŞ MEDİKAL TİCARET LTD. ŞTİ. – BALANCE SHEET-TL

ASSETS 31.12.2013 % 31.12.2014 % 31.12.2015 %

CASH AND CASH EQUIVALENTS 65.506 7 66.889 5 322.721 16

TRADE RECEIVABLES 156.241 18 452.804 34 565.726 29

Notes Receivables 22.527 3 44.427 3 141.550 7

Account Receivables 133.714 15 408.377 31 424.176 22

Due from subsidiaries 0 0 0 0 0 0

OTHER RECEIVABLES 39.380 4 39.592 3 47.308 2

Due from shareholders 0 0 0 0 0 0


Other Receivables and accruals 39.380 4 39.592 3 47.308 2

INVENTORIES(NET) 443.908 50 532.485 40 692.279 35

Raw material / Semi finished good 7.347 1 4.100 0 0 0

Finished good / Trade good 329.427 37 390.103 29 479.354 24

Other Inventories/ provisions for inventories.(-) 0 0 0 0 0 0

Advanced payment 107.134 12 138.282 10 212.925 11

CONSTRUCTION COSTS 0 0 0 0 0 0

OTHER CURRENT ASSETS 24.527 3 57.421 4 64.562 3

I-TOTAL CURRENT ASSETS 729.562 82 1.149.191 87 1.692.596 86

TRADE RECEIVABLES 3.597 0 3.597 0 3.597 0

OTHER RECEIVABLES 0 0 0 0 0 0


Due from Shareholders 0 0 0 0 0 0

Other Receivables 0 0 0 0 0 0

CONSTRUCTION COSTS 0 0 0 0 0 0

INVESTMENT IN SUBSIDIARIES 0 0 0 0 0 0

TANGIBLE FIX ASSETS(Net) 31.507 4 (24.615) (2) (34.829) (2)

Land and Building 239.712 27 242.950 18 242.950 12

Plant, machinery and equipment 107.118 12 107.118 8 139.868 7

Capitalized mobilization expenses 3.564 0 3.564 0 3.564 0

Vehicles 89.920 10 32.000 2 32.000 2

Other tangible fix assets 134.013 15 139.068 11 152.073 8

44

Accumulated depreciation (-) 542.820 61 549.315 41 605.284 31

OTHER NON- CURRENT ASSETS 89.180 10 128.284 10 243.913 12

INTANGIBLES 1.998 0 39.081 3 36.542 2

LEASING RIGHTS 28.821 3 28.821 2 28.821 1

II-TOTAL NON-CURRENT ASSETS 155.103 18 175.168 13 278.044 14

TOTAL ASSETS

884.665 100 1.324.359 100 1.970.640 100

45


Table 16 Balance sheet (Liabilities)

LIABILITIES 31.12.2013 % 31.12.2014 % 31.12.2015 %

FINANCIAL LIABILITIES 0 0 0 0 0 0

TRADE PAYABLES 205.310 23 393.507 30 581.921 30

Commercial Payables 205.310 23 393.507 30 581.921 30

Due to related parties 0 0 0 0 0 0

ADVANCES RECEIVED 15.462 2 4.984 0 18.100 1

CONTRUCTION REVENUES 0 0 0 0 0 0

OTHER CURRENT LIABILITIES 15.887 2 26.278 2 57.679 3

Advances from shareholders 0 0 0 0 275 0


Dividends 0 0 0 0 0 0

Other Payables 15.887 2 26.278 2 57.404 3

I-TOTAL CURRENT LIABILITIES 236.659 27 424.769 32 657.700 33

FINANCIAL LIABILITIES 609.855 69 882.735 67 1.019.340 52

TRADE PAYABLES 0 0 0 0 0 0

OTHER PAYABLES 0 0 0 0 0 0

Loan from Shareholders 0 0 0 0 0 0


Other Payables 0 0 0 0 0 0

CONSTRUCTION REVENUES 0 0 0 0 0 0

OTHER NON-CURRENT LIABILITIES 0 0 0 0 0 0

II-TOTAL NON-CURRENT LIABILITIES

609.855 69 882.735 67 1.019.340 52

CAPITAL 5.000 1 26.315 2 30.000 2

Capital 5.000 1 30.000 2 30.000 2

Unpaid capital 0 0 3.685 0 0 0

CAPITAL RESERVES 0 0 0 0 0 0

INFLATION ADJUSTMENT 20.087 2 0 0 0 0

PROFIT RESERVES 1.909 0 1.909 0 1.909 0

RETAINED EARNINGS 239.292 27 11.155 1 (11.369) (1)

ADJUSTMENT TO EQUITY 0 0 0 0 0 0

PROFIT/LOSS CURRENT YEAR (228.137) (26) (22.524) (2) 273.060 14

III-SHAREHOLDER EQUITY 38.151 4 16.855 1 293.600 15

MINORITY INTEREST (+)/(-) 0 0 0 0 0 0

TOTAL LIABILITES 884.665 100 1.324.359 100 1.970.640 100

46


Table 17 Income statement

INCOME STATEMENT (TL)

2013 % 2014 % 2015 %

INFLATION RATE 6,36% 5,71%

CHANGE IN SALES -2,79% 15,01%

REEL GROWTH OF SALES -9,15% 9,30%

TOTAL GROSS SALES 1.286.114 1.242.083 1.422.615

DOMESTIC SALES 1.218.444 1.185.312 1.359.483

ABROAD SALES 67.670 48.728 40.977

Other sales related income 0 8.043 22.155

Sales related costs (-) (26.157) (17.233) (13.952)

NET SALES 1.259.957 100 1.224.850 100 1.408.663 100

COGS (924.001) (73) (824.625) (67) (653.076) (46)

GROSS PROFIT 335.956 27 400.225 33 755.587 54

Selling and General Administrator Exp (294.105) (23) (306.936) (25) (325.352) (23)

Depreciation (192.459) (15) (32.544) (3) (55.969) (4)

OPERATING PROFIT (150.608) (12) 60.745 5 374.266 27

Other income 0 0 0 0 0 0

Other expense 0 0 0 0 0 0

F/X Gains 0 0 0 0 0 0

F/X Losses 0 0 0 0 0 0

EBIT (150.608) (12) 60.745 5 374.266 27

Interest expense (77.529) (6) (90.775) (7) (91.773) (7)

ORDINARY PROFIT (228.137) (18) (30.030) (2) 282.493 20

Extraordinary income 0 0 7.506 1 37 0

Extraordinary expense 0 0 0 0 0 0

PROFIT/LOSS DUE MINORTY INTEREST 0 0 0 0 0 0

EARNING BEFORE TAX (228.137) (18) (22.524) (2) 282.530 20

TAX 0 0 0 0 (9.470) (1)

NET INCOME (228.137) (18) (22.524) (2) 273.060 19

47


Graph 16 Profits and loss

Basic, Financial Figures & Ratios:

Table 18 Basic financial figures

BASIC FIGURES 2013 2014 % 2015 %

NET SALES 1.259.957 1.224.850 (3) 1.408.663 15

OPERATING PROFIT (150.608) 60.745 (140) 374.266 516

EARNING BEFORE TAX (228.137) (22.524) (90) 282.530 (1.354)

SHAREHOLDER EQUITY 38.151 16.855 (56) 293.600 1.642

TOTAL ASSET 884.665 1.324.359 50 1.970.640 49

TRADE RECEIVABLE 159.838 456.401 186 569.323 25

INVENTORIES 443.908 532.485 20 692.279 30

NET FIX ASSETS 155.103 175.168 13 278.044 59

FINANCIAL LIABILITIES 0 0 0 0 0

CURRENT LIABILITIES 236.659 424.769 79 657.700 55

NON-CURRENT LIABILITIES 609.855 882.735 45 1.019.340 15

48


Table 19 Financial Ratios

FINANCIAL FIGURES 2013 2014 2015

NET WORKING CAPITAL 492.903 724.422 1.034.896

CURRENT RATIO 308,28 270,54 257,35

QUICK RATIO(ACID-TEST RATIO) 120,70 145,19 152,09

NET PROFIT/NET SALES (18,11) (1,84) 19,38

NET PROFIT/SHAREHOLDERS EQUITY (597,98) (133,63) 93,00

NET SALES/TOTAL ASSETS 142,42 92,49 71,48

NET PROFIT/TOTAL ASSETS (25,79) (1,70) 13,86

DAYS ACCOUNTS RECEIVABLE 45,67 134,14 145,50

DAYS ACCOUNTS LIABILITIES 79,99 171,79 320,78

DAYS OF INVENTORY TURNOVER 172,95 213,13 337,57

CASH CONVERSION 138,63 175,48 162,29

S.T BANK LOANS/NET SALES 0,00 0,00 0,00

TOTAL LIABILITIES/TOTAL EQUITY 2.218,85 7.757,37 571,20

EBIT/INTEREST EXPENSE (194,26) 75,19 407,86

TOTAL LIABILITIES/TOTAL ASSETS 95,69 98,73 85,10

BANK LOANS/TOTAL ASSETS 68,94 66,65 51,73

INVENTORY/TOTAL CURRENT ASSETS 60,85 46,34 40,90

TOTAL EQUITY/TOTAL LIABILITIES 4,51 1,29 17,51

BANK LOANS/NET SALES 48,40 72,07 72,36

ST LIABILITIES/TOTAL LIABILITIES 26,75 32,07 33,37

BANK LOANS/TOTAL DEBTS 72,04 67,51 60,78

TANGIBLE ASSETS/TOTAL EQUITY 82,58 (146,04) (11,86)

OPERATING PROFIT/NET SALES (11,95) 4,96 26,57

INVENTORY TURNOVER 2,08 1,69 1,07

RECEIVABLE TURNOVER 7,88 2,68 2,47

GROWTH OF NET SALES (2,79) 15,01

GROWTH OF TOTAL ASSETS 49,70 48,80

A financial analysis based on the current situation with recommendations can be made available for

the upper management of the company upon demand.

Financial Analysis and Evaluation of Business Plan: In this context, DOĞUŞ MEDİKAL TİCARET LTD. ŞTİ. directors were invited to the TAT’s office to discuss developed draft business plan and the STEs conducted presentations about the missing financial and operational information on 28/09/2016. The benefit of business plan and the concept of financial analysis explained to the participants and a financial spreadsheet template shared with them. The business plan experts also forwarded the templates by e-mail messages asking for the required information.Unfortunately no data is returned to us except the previously obtained information shown with the below table and the graph. Obviously that much data is nowhere near to build the financial evaluation section of a sound business plan.It is advised by the TAT that the presented financial model can be developed with the company during the monitoring period. With the aim of supporting role models to increase their production,

innovation and competitiveness capacities, consultancy and advisory services will be delivered by the TAT to ensure effective implementation of their Business Plans.

49


Sales plan

Table 20 Sales plan

Product Type (Ürün Türü)

YEARS (YILLAR)

1 2 3 4 5

Quantity

(Miktar)

Unit Price

(Birim Fiyat)

Total

(Tutarı)

Quantity

(Miktar)

Unit Price

(Birim Fiyat)

Total

(Tutarı)

Quantity

(Miktar)

Unit Price

(Birim Fiyat)

Total

(Tutarı)

Quantity

(Miktar)

Unit Price

(Birim Fiyat)

Total

(Tutarı)

Quantity

(Miktar)

Unit Price

(Birim Fiyat)

Total

(Tutarı)

HEARING AIDS 1.000 1.750,00 1.750.000,00 1.200 1.925,00 2.310.000,00 1.500 2.117,50 3.176.250,00 2.000 2.329,25 4.658.500,00 3.000 2.562,18 7.686.525,00

AUDIOMETRY DEVICE 10 13.000,00 130.000,00 50 14.300,00 715.000,00 100 15.730,00 1.573.000,00 150 17.303,00 2.595.450,00 300 19.033,30 5.709.990,00

TYMPANOMETRY 10 13.000,00 130.000,00 50 14.300,00 715.000,00 100 15.730,00 1.573.000,00 150 17.303,00 2.595.450,00 300 19.033,30 5.709.990,00

INSULATED CABIN 50 8.000,00 400.000,00 100 8.800,00 880.000,00 200 9.680,00 1.936.000,00 400 10.648,00 4.259.200,00 600 11.712,80 7.027.680,00

LOPRO3 50 4.500,00 225.000,00 100 4.950,00 495.000,00 200 5.445,00 1.089.000,00 400 5.989,50 2.395.800,00 600 6.588,45 3.953.070,00

SIEMENS HEARING DEVICE 1.500 1.750,00 2.625.000,00 1.600 1.925,00 3.080.000,00 1.700 2.117,50 3.599.750,00 1.800 2.329,25 4.192.650,00 2.000 2.562,18 5.124.350,00

SELF SERVICE HEARING DEVICE 20 0,00 0,00 100 0,00 0,00 100 0,00 0,00 300 0,00 0,00 500 0,00 0,00

TOTAL (TOPLAM)

5.260.000,00

8.195.000,00

12.947.000,00

20.697.050,00

35.211.605,00

Graph 17 Sales income by years

8. APPENDIX

ANNEX 1 ACTIVITY PLAN

Activities

Project steps

1st Year

1 2 3 4 5 6 7 8 9 10 11 12

Evaluation of the issues mentioned at the business plan

Applying Training Needs Analysis to the Company X

Identifying the training topics according to the TNA X

Delivery of the trainings X X X X X X X

Identifying the topics for coaching and consultancy services X

Delivery of coaching and consultancy services X X X X X X X

1

Contents of this publication are the sole responsibility of Archidata consortium, and in no way

can be taken to reflect the views of the European Union


2

doğuş medikal tic. ve san. ltd. Şti. business p lan · figure 1 selection of role model...

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