1. REGIONAL DISTRIBUTION CENTRE CEDI PARTNERS Noah Chapman, Rob Campbell and Kyla Hanson LAC SEUL FIRST NATIONS

2. Role MNP was hired by the CEDI partners to determine the feasibility of the Regional Distribution Center in Sioux Lookout

3. Work Plan Providing the basis for our work plan is the methodology below. We have tailored our approach to this project based on your requirements, and have embedded this methodology into our approach and work plan. It is our experience that by following a well-defined and ‘tried and true’ methodology, we are better able to achieve complete, credible and valid recommendations that meet your expectations. Using this framework at the outset also allows us to work with you to refine our approach and ensure you are comfortable ahead of time that it will meet your needs. In the following five phases we propose to 1.Thoroughly establish the process with you to ensure we are all on the same page for the work to be completed 2.Analyze the current state of the market to determine the feasibility of capturing the required business 3.Develop a general concept of space and market costs and test against general market rates for grocery items in the area; at this stage we expect two or three iterations in terms of size and cost that will zero in on the ‘best fit’ for this project 4.Once that has been determined we will launch more detailed analysis including financial analysis - capital costs, cash requirements etc. – operational analysis, legal structure and governance. Final feasibility will be determined 5.Finally, all previous work will be fully documented in a feasibility report that can, in itself be used for financing or can form the basis for input to the development of a final business plan.

4. Timeline March 10-11  Meeting in Sioux Lookout March 11 – April 8 Apr 9-10 April 30 May 1 –21 July/August  Industry and Logistics Research  Community vist x2  1 st Community Engagement Conference in Sioux Lookout  Research, Analytics and Creation of Draft Feasibility Report  Feasibility Study Complete June ?  2nd Community Engagement  Date TBD at 1st Engagement  Review Draft Report

6. Determining Feasibility To determine initial feasibility from a conceptual idea, it is essential to create assumptions within the following areas that can begin to define the overall project. Products Customers Distribution Supply Transaction Feasibility must rely on concrete data and information to build a functioning model. There may be other opportunities and ideas that present themselves, and should be considered once the feasibility is determined.

7. Determining Feasibility (Continued) Product demand Buying habits Expectations Customer Product cost Economies of scale Supplier logistics Supplier Cost Supplier to distribution Distribution to customer Freight Capital and operating costs Location and infrastructure Competitive position Sources of funding H.R. Plan Legal structure, governance and ownership Distribution Center CEDI Decision Making Feasibility Conclusion Retailer Industry partner Social service Community Distribution

8. Proposed Role of the Distribution Centre Distribution Center Promotion Packaging Coordination Transaction Warehousing Relationship Development Distribution Centre

9. Successful models Bundles concept Healthy Affordable Social Enterprise/Sustainability Social enterprise – not to maximize profits Sufficient operational revenue Community involvement and commitment will be essential Observations

10. Consumer Habits How often do you grocery shop? Who is the primary shopper in your household? What is the size of your household? How do you pay for goods? Are you conscious of prices while grocery shopping? Do prices affect whether or not you will purchase an item? What is your average spend per month? Have you participated in any kind of “mail order” program? Would you order and wait for items or is immediate possession required? What kind of cost savings is needed for you to consider ordering your groceries?

11. Consumer Research

12. Prior Community Research Findings Food prices in our sample community were not as expensive as promoted in media Competition is growing Do not want to impact local merchants People were not overly enthusiastic in receiving goods in a pre order format unless the savings are significant There is an acceptance to the local reality Trend towards healthier food Social assistance vs. employed

13. Prior Community Research Findings Top 10 items 1.Milk 2.Bananas 3.Cereal & Oatmeal 4.Potatoes 5.Eggs 6.Hot dogs or bologna 7.Bread 8.Ground beef 9.Bacon 10.Margarine or butter

14. Winnipeg Prices vs. Northern Community ItemQuantityWinnipeg PriceNorthern Price Milk 1L$1.57$3.12 Bananas 1kg$1.70$2.45 Cereal 350g$3.39$8.29 Potatoes 5lb$2.95$5.00 Eggs 1 dozen$2.97$3.99 Ground Beef 1kg10.88$14.95 Bread $3.47$3.99 Ground beef 1kg$14.95$13.18 Yogurt 650g$2.47$4.50

15. Next Steps/Future Opportunities Specialized resources and groups to support the process Partnering with other organizations focused on a similar objective Significant business plan Further promotion and community research