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Next-RO, Inc. The Cleanest, Safest, Best Tasting Purified Drinking Water Directly from Your Tap. Faster Better Cheaper.

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Presentation on theme: "Next-RO, Inc. The Cleanest, Safest, Best Tasting Purified Drinking Water Directly from Your Tap. Faster Better Cheaper."— Presentation transcript:

1 Next-RO, Inc. The Cleanest, Safest, Best Tasting Purified Drinking Water Directly from Your Tap. Faster Better Cheaper

2 The U.S. Water Demands - U.S. population increased 50% while water consumption increased 300% - It is estimated that 36 states will be enduring water shortages by Availability of clean drinking water decreases with climate changes, industrialization and pollution. - Every one needs clean drinking water - There is no substitute.

3 U.S. Water Market - Average American consumes 6.1 (8 ounce) servings of water per day servings of that is bottled water - Water is estimated to be a $75 billion a year industry - U.S. water market expected to reach $150 billion by 2010

4 U.S. Water Quality - Studies have found that pollution and deteriorating plumbing are delivering drinking water that might pose health risks - Studies have found that pollution and deteriorating plumbing are delivering drinking water that might pose health risks - Aging pipes can break, leach contaminants and breed bacteria - Tap water can contain - Lead, Pathogens (germs), Trihalomethanes (THM’s), Arsenic, Radon, Perchlorate - American Society of Civil Engineers gives the country’s water system a D minus.

5 Alternatives to Tap Water Bottled Water – is often no more than carbon filtered tap water Home Filtration – various companies are selling RO, Ultra Filtration and Carbon Filtration devices Water Stores – retail locations where you can purchase purified water in bulk

6 Bottled Water Demand - U.S. is the Worlds leading consumer of bottled water – 26 billion liters in Showing a 9.7% growth - Costs as much $2.50 a liter or approx. $10 gal - 57% growth in 5 years is attributed to: - that lack of confidence in public water - convenience

7 Plastic Water Bottles - Plastic water bottles produced in the U.S. (2004) required 1.5 million barrels of crude oil - Transporting bottled water involves burning fossil fuels - 86% of plastic water bottles used in the U.S. become garbage or litter - Buried water bottles can take up to 1,000 years to biodegrade - 40% of recycled water bottles deposited in the U.S. in 2004 were exported – using more fossil fuels

8 Home Filtration - RO water is the purest, cleanest and SAFEST drinking water in the world - Removes up to 99% of unwanted substances commonly found in tap and well water - RO water is the most recommended by doctors and dietitians

9 Traditional RO System Problems 1. In-efficient and Wasteful – As many as 19 gallons of water can be wasted to create 1 gallon of product water 2. Bulky – Up to 2 X the size of the Next-RO engine 3. Inconsistent Water Delivery – often produce half full ice cube trays and pots of coffee

10 Traditional RO systems

11 System Comparison

12 Next-RO The Industries Best Next-RO is the culmination of over 100 years of combined experience in the “Point of Use” Water Filtration business. Each member of the design team brings specific expertise including injection molding, manufacturing and filtration.

13 Tim Beall – CEO, President, Director - 33 years experience in plastic injection molding and water treatment - Specializing in - Plastic injection mold manufacturing, tool design and system assembly - Authority on Water on water RO system design and development - Authority on valve design and integration - Developed and holds patents in Water on Water RO system design - Developed and patented a break through Bio Disinfect Ion system - Worked extensively with the Coca Cola Company and Pepsi Cola Company on a new water system concept for the Post Mix fountain business.

14 Robert A Slovak - Director - 34 years experience in water treatment - Specializing in - Commercial, residential and industrial RO System design, development and installation - Co-founded Water Factory Systems, Inc. manufactures RO systems sold to Cuno, Inc. now owned by 3M - Published numerous articles on water treatment - Holds patents pertaining to design and control innovations in RO and filtration - Member of NSF/ANSI - Serves on WQA RO committees developing RO system standards

15 Michael T. Baird – Director - 23 years of experience in water treatment - Specializing in – filtration, membrane technology, chemical treatment and disinfection - President and CEO of TST Water - Built and sold Hydro-Flow (filter manufacturer) now Pentair - 8 years - VP of sales and marketing for Sta-Rite Industries responsible for - sales and marketing, acquisition, OEM account development - On the board of directors of the WQA (chairman of international business) - On the board of directors of Carbon Resources, Inc.

16 Jack Slovak – Shareholder - 34 years experience in water treatment - Specializing in - Commercial, residential and industrial RO - RO System design and development - RO installation - Business operations, negotiations and sales - Co-founded Water Factory Systems, Inc. manufactures RO systems sold to Cuno, Inc. and is now 3M - 8 years stayed on as chief engineer

17 The Next Generation of RO The Most Advanced Purified Drinking Water System in the World!

18 Next-RO System Components 1. The Valve – Patented technology key in producing RO water with "no backpressure" on the membrane 2. Tank - Patented technology allows for far smaller tank 3. Manifold Technology – eliminates hoses, bulky mess and leaks inherent in other systems 4. Filters - Bayonet / quick connect design for easy maintenance and safe, sterile exchange

19 The Engine

20 How it Works

21 Next-RO Performance Advantages High Efficiency - can reduce waste water up to 500% over conventional RO systems High Efficiency - can reduce waste water up to 500% over conventional RO systems Convertible - the only POU RO system in the world designed to go on the counter or under the sink Crystal Clean Water Production - produces the highest quality water up to 50% faster than its “Air on Water” competitors Low Maintenance - quick connect cartridges require replacement no more than once a year Consistent Flow - service Refrigerator ice makers and water dispenser, coffee makers and coolers

22 Market Conditions - Approximately 500k to 600k POU RO units purchased annually in the U.S. and growing - Major OEM’s have been consolidating the industry – buying companies for 13 to 30 times value - Major OEM’s are all selling the same inefficient, bulky “Air Captive” systems - With no patent protection on the base technology, low cost foreign manufacturers have started to effect profit margins and threaten shelf space.

23 Marketing Strategy Next-RO is the Pentium Processor of the Home RO industry. With the ability to morph into a variety of different body styles each distribution channel can have their own unique look. While the machine you buy at Home Depot would look different from the one you might buy at Wal-mart – they would each be Powered by Next-RO. Next-RO is the Pentium Processor of the Home RO industry. With the ability to morph into a variety of different body styles each distribution channel can have their own unique look. While the machine you buy at Home Depot would look different from the one you might buy at Wal-mart – they would each be Powered by Next-RO.

24 Over 12,000 Big Box Stores in the US WAL-MART3,900 SEAR’S3,800 HOME DEPOT2,000 LOWE'S1275 COSTCO500

25 Next-RO Marketing Advantages - Broadest Range of Operating Conditions - 25 psi lower than closest competitor - opening markets current systems can’t go - Servicing Appliances - opens opportunities in small business, restaurants and office environments - Product Differentiation - we offer the OEM’s access to patented technology that will prevent low cost foreign manufactures from competing in the U.S. market

26 Next-RO Manufacturing Advantages Low Cost Manufacturing Low Cost Manufacturing The entire engine is plastic injection molded and assembled at the press. With less than 5% labor we can compete with China and manufacture right here in the United States. The entire engine is plastic injection molded and assembled at the press. With less than 5% labor we can compete with China and manufacture right here in the United States. High Speed Manufacturing High Speed Manufacturing Current plastic injection molding tooling was designed to meet or exceed 1,000 engines per day. Current plastic injection molding tooling was designed to meet or exceed 1,000 engines per day.

27 Next-RO Today -Letter of Intent for 67,800 units worth over 11 million dollars - Cover of WC&P July Issue - Over 50 requests for distribution rights in 15 different countries -Strong interest from GE, Watts, Culligan, Pentair, 3M, AO Smith (China) -Tooling complete and being tested - 1 st production units to be tested ( days)

28 Channels of Distribution DealersUtilities Powered by Next-RO U.S. Distributors Direct Response Foreign Mrkt Partners Next-RO Big Box Retail Rental Homeowner Independent Dealers Homeowner Branded Non-Branded Homeowner Distributor/ Dealer Homeowner

29 Streams of Revenue Minimum Annual Unit Sales Installation Commission 50% of Annual #’s Supplier Fee U.S. Commercial Fee International Marketing Fee Next-RO U.S. Installer Fee 50% of Annual #’s Minimum Annual Unit Sales Upgrade Commission

30 Strengths #1 Depth of Industry Experience -The Next-RO management team includes 4 of the worlds leading authorities in POU RO and Filtration. #2 Industry Credibility - The reputation of our team members gives us instant credibility and has opened negotiations with the biggest OEM’s #3 Innovative Patented Technology – Encompassed by 138 Claims, makes Next-RO the most advanced purified drinking water system in the world. We bring the cleanest, safest, best tasting drinking water directly to your tap - faster, better and cheaper than the competition. #4 Manufacturing Capabilities - Engineered to be completely injection molded. Less than 5% labor means we can manufacture (1000 units per day) right here in the U.S. and compete with China.

31 Opportunities #1 Orders and Letters of Intent for over 67,800 units totaling over 11,000,000 in gross revenue. #2 Lack of real product differentiation and the recent arrival of low cost manufactured products has threatened the shelf space and profit margins of the major OEM’s and created a real demand for our superior, patented product. #3 Demand for clean drinking water is rising and will continue to rise. #4 Water conservation concerns make the Next-RO engine (with its high efficiency rating) more attractive to retailers and consumers.

32 Threats #1 Competing technology- There are other filtration systems enjoying varying degrees of success. However, RO is still considered to be the best. #2 Material costs could increase affecting our profit margins. However, we have very high profit margins and the cost would have to increase precipitously. #3 Demand for filtered water decreases because public drinking water becomes more publicly accepted as drinkable.


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