EXECUTION AND SCALE-UP | FUWA BIOTECH

VIDEO PITCHING

A. Social business description

A1. Social Mantra One-liner

A2. Business Model Overview

Business Model Canvas

Needs:

Effective Cleaning: Customers seek reliable cleaning products that tackle dirt, grime, and germs effectively.
Eco-Friendly Solutions: Growing environmental concerns drive a desire for cleaning products that are safe for the environment and don’t contain harsh chemicals.

Wants:

Convenience and Affordability: Busy lives demand cleaning solutions that are easy to use and fit within budget constraints.
Personalized Guidance: Customers appreciate recommendations based on their specific cleaning needs and preferences.
Transparency and Authenticity: People want to know exactly what’s in their cleaning products and trust the brands they use.

Killer Features:

Unique and Powerful Eco-Enzyme Formula: FUWA’s proprietary formula harnesses the natural cleaning power of enzymes, delivering exceptional cleaning performance without harsh chemicals.
Sustainable and Refillable Packaging: FUWA prioritizes reusability, minimizing plastic waste and promoting a circular economy through refillable containers.
Community Engagement and Social Impact: FUWA goes beyond cleaning products, actively engaging with communities through 10+ annual social initiatives and providing employment opportunities for 1000+ women and minorities nationwide.

How FUWA Creates, Delivers, and Captures Value:

Water Usage Reduction: 50% reduction in water usage compared to conventional cleaning products, saving customers approximately 300,000 VND annually on water bills.
Reduced Cleaning Supplies: FUWA’s safe and effective formula eliminates the need for harsh chemicals and specialized cleaning products, saving customers money on gloves, cleaning tablets, and additional cleaning agents.
Air Purifier Replacement: FUWA’s VOC-free formula ensures clean indoor air, potentially eliminating the need for air purifiers and saving customers associated costs.
Multi-Purpose Cleaning Solutions: FUWA’s versatile products can handle multiple cleaning tasks, reducing the need for specialized products and saving customers 300,000 – 400,000 VND per year.
Refill Stations: FUWA’s refill stations allow customers to reuse containers, reducing packaging waste and saving 10-30% compared to purchasing new products.
Eczema-Safe Formula: FUWA’s gentle formula is safe for eczema-prone skin, potentially reducing healthcare expenses associated with skin irritation.

Sustainable Waste Management: FUWA diverts 300+ tons of pineapple waste annually from landfills, transforming it into cleaning products, promoting a circular economy.
Minimizing Plastic Waste: Refillable packaging and concentrated formulas reduce plastic waste by an estimated 150,000 bottles per year.
Community Empowerment: FUWA employs a diverse workforce (70% women and minorities), promoting social inclusion.
Promoting Healthy Living: Natural and hypoallergenic cleaning products minimize exposure to harsh chemicals, benefiting families and communities.

Customer Intimacy: FUWA personalizes recommendations through loyalty programs and educates customers on eco-enzyme benefits through workshops, fostering trust and loyalty.
Strategic Partnerships: Collaboration with like-minded organizations secures funding for social initiatives and expands FUWA’s reach and impact.
Positive Customer Feedback: High customer satisfaction ratings proposition and user engagement demonstrate FUWA’s successful value .

A3. Growth potential

A3.1. Market size

Total Addressable Market (TAM): The global green cleaning product market’s size and growth (USD 5.14 billion in 2023, CAGR 7.43%) indicate a strong overall market with increasing consumer interest in eco-friendly solutions. According to Statista, the revenue generated in the Household Cleaners market in Vietnam is estimated to reach US$0.61bn in 2024. It is projected to experience an annual growth rate of 3.94% (CAGR 2024-2029).

Serviceable Addressable Market (SAM): While the Vietnamese household cleaner market itself is smaller than the global green cleaning market (USD 0.61 billion in 2024, CAGR 3.94%), focusing on the 27 million households in Vietnam presents a significant potential customer base.

Serviceable Obtainable Market (SOM): Targeting the 15 million middle-income households in Vietnam further refines the market and aligns with potential customers who might be more likely to afford and value eco-friendly cleaning solutions.

Market Size and Growth:

Household Cleaning Products Market:
- Size: USD 0.61 billion in 2024
- CAGR: 3.94% from 2024 to 2029

Source: Statista, 2024

Eco-Enzyme Cleaner Market: Vietnam enzymes market size is projected to exhibit a growth rate (CAGR) of 6.30% during 2024-2032. The increased demand for digestive enzymes, expansion of the food and beverage (F&B) industry, expanding textile applications, surging product utilization in pharmaceuticals and nutraceuticals, the rising demand for eco-friendly cleaning products, and ongoing R&D efforts represent some of the key factors driving the market. (IMARC’s, 2023)

Target Audience

Middle-Income Households: 15 million households in Vietnam
Eco-Conscious Consumers: Vietnamese consumers are increasingly seeking eco-friendly alternatives in various aspects of their lives, including household cleaning.

=> The Vietnamese market for cleaning products presents a good opportunity for FUWA’s eco-enzyme cleaners. The growing market, demand for eco-friendly products, and FUWA’s differentiated offerings provide a solid foundation for success. However, competition and successful market share capture remain critical success factors. By focusing on product differentiation, targeted marketing, and competitive pricing, FUWA can establish itself in this promising market.

A3.2. Value chain of FUWA

FUWA creates value for a variety of stakeholders throughout its value chain, including:

Raw material suppliers: FUWA provides a market for pineapple peels, a waste product from the pineapple processing industry.
Distributors and sales agents: FUWA offers a profitable product line for distributors and sales agents to sell.
National and international press and magazines: FUWA provides newsworthy stories and content for media outlets.
Social and environmental organisations: FUWA aligns with the missions of social and environmental organisations by promoting sustainability and community development.
Households: FUWA offers effective cleaning products that are affordable, safe for health and the environment, and can help save money on water usage, gloves, air purifiers, and healthcare services.
Local community in Thanh Hoa Province: FUWA provides a steady income stream for local farmers and factory workers, especially women and ethnic minorities. They also help reduce waste by purchasing pineapple peels that would otherwise be thrown away.

A3.3. Expected Growth

FUWA demonstrates strong scalability with ambitious growth plans. Our roadmap includes:

2025: $4 million USD revenue, market expansion in Vietnam, and advanced research through an Eco Enzyme LAB.
2030: $20 million USD revenue, broader market penetration, and new product lines/
2035: $40 million USD revenue, market leadership in Vietnam, technology transfer to the USA, EU, China market and entry into more international markets

Current Revenue:

2023: $1.5 million USD

2024 (expected): $2 million USD

FUWA has significant growth potential that can be realized through our strategic actions. We avoid fierce competition in a growing sustainable cleaning market by:

Expanding distribution channels: We are collaborating with large supermarket chains and organic stores focusing on eco-friendly and safe-for-skin products. As a B2B business, 80% of our revenue comes from our distribution channels, with $880.000 of revenue for the first half of 2024. Our goal is to reach $2 million by the end of the year.
Boosting exports: We are partnering with well-established local companies of other countries, specifically targeting the US and Germany market. Notably, we secured an export contract of 250.000 EUR in 2023 and another 750.000 EUR contract in 2024. Additionally, we are planning to license our brand to local businesses in the EU to ensure effective market entry and representation while maintaining brand standards.
Diversifying product line: We are expanding the product line to include body care products, as we understand the increasing consumer demand for personal care items.

A3.4. The target market’s potential

A survey of 300 respondents reveals a positive perception of FUWA cleaning products, particularly for their safety (4.7 average rating), eco-friendliness (high interest in natural ingredients), and ease of use (68% satisfied). The core value proposition of being safe for children and pets resonates well (82% confident using them). However, affordability remains a concern (only 55% find them competitive). There’s also an opportunity to improve communication: 18% had difficulty understanding usage instructions, and 75% expressed interest in learning more about ingredients. By addressing these areas and potentially offering refill options and a wider product range, FUWA can solidify its position as a leader in safe, sustainable cleaning solutions.

Target Customer:

Parents/Guardians of Young Children: 60%
Health & Safety-Conscious Consumers: 85%
Environmentally Conscious Consumers: 78%

Needs:

Feature	Average Rating (1-5)
Safe for children and pets	4.7
Effective cleaning	4.3
Gentle on sensitive skin	4.2
Free from harsh chemicals	4.6
Natural and biodegradable ingredients	4.5
Affordable	3.8
Easy to use	4.4
Minimizes plastic waste	4.1

Perceived Value:

Safety & Effectiveness: 72% of respondents rated FUWA products as meeting or exceeding expectations.
Ease of Use: 68% of respondents were satisfied or extremely satisfied with ease of use.
Confidence Around Children and Pets: 82% of respondents felt confident using FUWA products around children and pets.
Healthy Home Environment: 80% of respondents believed FUWA products contribute to a healthier home environment.
Competitive Pricing: Only 55% of respondents felt FUWA products were priced competitively.

Gap Identification:

Difficulties Using Products: 18% of respondents reported difficulty understanding usage instructions.
Interest in Ingredients: 75% of respondents expressed interest in learning more about FUWA’s ingredients.
Delivery Issues: 5% of respondents experienced delivery delays or problems.
Website Clarity: 72% found the FUWA website information clear and helpful.
Customer Service Satisfaction: Average satisfaction rating for customer service was 4.2 (out of 5).

Overall Satisfaction:

Recommendation Score: The average score for recommending FUWA products was 4.0 (out of 5).

Observations and Recommendations:

Gap 1: Knowledge Gap: Targeted campaigns highlighting FUWA’s safety, eco-friendliness, and ease of use are needed.
Gap 2: Standards Gap: Consider reformulating products for improved cleaning performance while maintaining eco-friendly credentials, addressing the 4.3 average rating.
Gap 3: Delivery Gap: Delivery issues appear minimal, but continued monitoring is essential.
Gap 4: Communications Gap: Website content should be reviewed for clarity, particularly usage instructions. A dedicated FAQ section would be beneficial.
Gap 5: Customer Gap: Implementing a customer feedback loop is crucial, addressing refill options and product variety.

Overall, the survey results indicate a positive perception of FUWA, with strong ratings for safety, eco-friendliness, and ease of use. However, addressing affordability concerns and improving communication regarding ingredients and usage instructions are key areas for improvement.

Positive Perception: Here, 72% of respondents rated safety and effectiveness as meeting or exceeding expectations, along with 82% feeling confident using the products around children and pets. This indicates a strong positive perception of FUWA’s core value proposition.

A3.5. Timing Strategy

Strategic Plan: Achieve $40 Million USD in Revenue Within 10 Years

Goal: Secure a dominant market position in Vietnam and establish a strong international presence within 10 years, achieving a total revenue of $40 million USD.

Strategic Steps:

Step 0: Advanced Research through an Eco-Enzyme Lab

Objective: Foster sustainable and long-term product innovation
Tactics:
- Establish an Eco-enzyme lab with professional biochemistry personnel for ongoing research and development of new products.
- Continuously reduce fermentation time of Enzyme (now: 3 months -> 1 month) to reach higher efficiency in production.

Step 1: Expansion into Body Care, Baby Care, Pet Care, and Car Care Products (2025-2026)

Target: Maintain FUWA’s position as the leading eco-enzyme brand in Vietnam.
Objective: Diversify product lines to drive organic revenue growth
Tactics:
- Develop and launch 10 new products across the four new categories.
- Leverage existing online and offline distribution networks to introduce new products.
- Partner with NGOs to support health and environment initiatives and prove FUWA’s commitment to sustainability.

Step 2: Expansion into More Offline Distribution Channels (2026-2028)

Target: Increase accessibility and market share
Objective: Tap into more offline channels such as shopping malls, organic stores, and mother and baby stores
Tactics:
- Partner with 100 retail chains and secure shelf space in key locations.
- Negotiate with 500 organic and mother&baby stores for product placement.
- Implement in-store promotions and marketing campaigns.

Step 3: Promote Export and Technology Transfer to International Markets (2028 – 2035)

Target: Strengthen presence in the current international market (the US, Germany, China) and entry into more markets (Canada, EU,…)
Objective: Increase export volumes and establish international partnerships
Tactics:
- Partner with established distributors in each target market to streamline market entry.
- Identify and form strategic alliances with 10 international partners.
- Participate in 20 trade fairs and exhibitions globally.

By 2035, we aim for 40 million USD revenue, market expansion in Vietnam, and entry into the USA, EU, and China. Plans include new body care products and significant R&D investments.

Opportunities:

High Market Potential: The USA, EU, and China represent large markets with a growing demand for sustainable cleaning products. This translates to a significant potential for increased sales and revenue for FUWA.
Premium Pricing Potential: Consumers in these regions are often willing to pay a premium for eco-friendly products, allowing FUWA to potentially command higher prices compared to its home market.
Brand Recognition and Global Expansion: Entering these major markets can significantly boost FUWA’s brand recognition and establish them as a global leader in sustainable cleaning solutions.
Access to Expertise and Resources: These markets offer access to advanced technology, distribution networks, and potential partnerships that can accelerate FUWA’s product development and market reach.

Opportunity Costs:

Focus on Established Markets: By devoting resources to entering new markets, FUWA may miss out on further saturating the Vietnamese market, which could still offer significant growth potential.
Product Reformulation Costs: Regulations in the USA, EU, and China may necessitate reformulating FUWA’s products to comply with local standards, leading to additional development and testing expenses.
Increased Marketing and Advertising Costs: Effectively reaching new audiences in these regions will require significant investment in targeted marketing and advertising campaigns.
Distributor Reliance: Partnering with distributors can expedite market entry, but also reduces FUWA’s control over branding, marketing messages, and potentially profit margins.
Cultural Differences: Adapting FUWA’s marketing messages and product labelling to resonate with consumers in each region requires careful consideration of cultural preferences and communication styles.

A3.6. SWOT Analysis for our Strategy

B. Resources and capabilities to execute

B1. Key capitals

B1.1. Human capitals

Current Team

Business Operations

Supporters

Key Human Capitals

Learning and Development Strategies

B1.2. Social capitals

1. Government Connections:

The “One Commune One Product” (OCOP) program in Thanh Hóa province, Vietnam, has significantly helped FUWA build its brand. Since 2021, our company is the first in the province to be rated as 4 stars OCOP products. Our CEO was also awarded a typically amazing ideas and products prize in “Women’s Day of Creativity and Entrepreneurship” 2021 celebrated by Thanh Hoa Women’s Union.
In Feb 2023, FUWA participated in the official cooperation signing ceremony between the Agricultural Trade Promotion Center and TikTok Vietnam. This cooperation event aims to enhance the digital transformation capabilities of agricultural products and OCOP products on the OCOP platform.
In May 2023, FUWA participated in The High-Level Forum on Building an Innovative Startup Ecosystem in the Red River Delta 2023, organized by the Vietnam Chamber of Commerce and Industry (VCCI) in collaboration with the Ministry of Science and Technology.

2. Business Network

Industry Contacts:

1000+ Sale Agents: Medium to big-sized agents such as AEON malls, Naman Market, Lotte Mart, etc. They stock & display our products, aiding promotional support.
Local Supplier: Local canned pineapple factory providing us with 100% recyclable raw materials, supporting production cost discounts, etc
Trade Partners: We have participated in 10+ trade fairs including “Vietnam-India trade conference”, “Trade promotion and Economic Promotion between Vietnam and Yunnan (China)”, “Germany trade fair”, “Connecting Impact Markets with Canada”…

Collaborative Partners:

50+ media partners worldwide: well-established press & magazines such as Business Insider, VTV, Vietsuccess, etc. They published 100+ articles and videos, helping us to reach 10+ million people.
6 E-commerce platforms: Major platforms such as Amazon, Shopee, etc. They provide us a global reach to 100,000+ customers.
10+ Export Businesses: partners from Germany, China, Malaysia, Poland, etc. They help us to reach international markets efficiently & expand our global footprint.
20+ NGOs: partners such as UNDP, etc. Their endorsements & collaborative efforts enhance our credibility & help us engage with eco & health-conscious consumers & stakeholders.

Customer Base:

1+ million customers worldwide with 90% positive feedback
50.000+ supporters on social platforms: Their support helps us build brand awareness, foster customer loyalty & continuously improve our products.

3. Value Optimization and Expansion Strategy

Partner Recruitment

Alignment with FUWA’s mission: Potential partners share commitment to sustainability & health responsibility.
Reputation & Track Record: Partners with proven quality & success with positive feedback from other collaborators.

Stakeholder Engagement

Feedback Loops: Implement mechanisms for regular feedback from partners.
Performance Reviews: Assess the effectiveness of the partnership, making necessary adjustments.

B1.3. Intellectual capital

Strong R&D Team: Biochemistry Experts with 8+ years of experience in developing Eco Enzyme formulas, successfully reducing fermentation time from 3 months to 1 month.
18 Eco Enzyme cleaning products which are continuously tested and developed to meet customers’ needs and minimize waste in production process.
Quality Certificates: 15+ certificates for safety, cost-saving & environmental-friendly products such as DKA, OCOP, etc.
Partnerships with VN-UK Institute for Research and Executive Education to research about Enzyme.

B1.4. Manufactured Capital

1. Physical Property Portfolio

2. Asset Utilization Efficiency

3. Maintenance Practices & Investment

Schedule: Regular maintenance scheduled monthly to minimize unexpected breakdowns.
Investment: $100,000 annually to ensure all physical resources are in optimal condition.
Practices: Use of advanced monitoring systems to track equipment performance and predict maintenance needs.

4. Financial Ratios

Net Income = $1,041,667−($91,500+$100,000) = $850,167

Total Assets= $2,000,000+$500,000+$1,500,000+$200,000 = $4,200,000

ROA = Net Income / Average Total Asset = 4,200,000/850,167 ≈ 20.24%

ROI = 15.26%

SROI = 0.63

B1.5. Financial Capital

B2. Business Traction

B2.1. Readiness

Value chain analysis

To evaluate our level of readiness, we conducted a Porter’s Value Chain analysis to gain a comprehensive overview of the entire business:

As you can see, our products are at a high level of readiness, as evidenced by the above value chain analysis. To improve our products, we embedded the Continuous Improvement Cycle, illustrated as below:

This continuous cycle ensures that FUWA’s products remain competitive, innovative, and aligned with market demands.

B2.2. Sales Growth Rate

Past Performance:

Sales Metric

Our sales have increased from 91,500 units in 2022 to 124,700 units in 2023. We experienced a 40% increase in sales from 2022 to 2023.（See more in Confidential Info）

Social Solution adoption rate & Inventory Turnover Rate

From the provided data from the Shopee overview, we have the number of orders as follows:

May 2024: 8,719 orders
Total for 2023: 18,055 orders

Customer engagement metrics

B2.3. Beneficiary Growth Rate

Our beneficiaries include suppliers, factory workers, sales agents, retailers, customers and the community. To clarify our beneficiary growth rate, we first created a table which shows the values we provide to our beneficiaries, how we supply these values and how we can improve them over time.

For sizing purposes, we identify the two most important beneficiaries of FUWA, which are middle-income, environment-conscious households in Vietnam and the local community in Thanh Hoa Province, Vietnam.

We estimated the beneficiaries of FUWA for 2023 and the first half of 2024 to be approximately 305.750 and 360.492 respectively.

Beneficiary Growth Rate = (360.492 – 305.750)/305.750 = 17.9%

B3. Risk management

EXTERNAL RISKS

INTERNAL RISKS

MITIGATION STRATEGIES

C. ESG Performance

C1. Overall impacts on the society and environment

C1.1. Current Activities

Environmental Responsibility

Sustainable Sourcing:

Raw Materials: We use pineapple peels, a waste product from one of the largest pineapple-growing regions in Thanh Hoa, Vietnam. We save 300 tons of pineapple trash annually and contribute to a circular economy.
Eco Enzymes: Our eco enzymes make our products biodegradable and environmentally friendly.

Green Supply Chain:

Waste Reduction: Our production process uses pineapple peel as the input. After fermenting, the liquid is used to make our products and the residue is used as fertilizer for local farms.
Low Carbon Footprint: We employ energy-efficient processes and prioritize local sourcing to reduce our carbon emissions throughout the supply chain.

Product Sustainability:

Zero Harmful Chemicals: Our commitment to 0% colorants, 0% artificial fragrances, and 0% harmful chemicals ensures that our products are safe for both users and the environment.
Eco-Friendly Packaging: We use recyclable and biodegradable packaging materials to minimize our environmental impact.

Social Responsibility

Community Engagement

Local Partnerships: By sourcing pineapple peels from local factories, we support the local economy and create additional income streams for communities in Thanh Hoa.
Education and Awareness: We actively engage with our community to educate them about the benefits of eco-friendly products and sustainable lifestyles.

Health and Safety

Safe Products: Our products are designed to be gentle on all skin types, including sensitive skin and babies, reducing health concerns for users.
Healing Properties: Eco Enzymes in our products can soothe wounds, burns, and inflammation.

Governance

Ethical Business Practices

Supportive Workforce: By ensuring that 90% of our workforce comprises women and ethnic minorities, FUWA promotes diversity and inclusivity.
Transparency: We maintain transparency in our sourcing, production processes, and product ingredients on all social platforms, ensuring that our customers are fully informed about what they are buying.

Continuous Improvement:

Innovation: We continuously invest in research and development to improve our products and processes, ensuring that we remain at the forefront of sustainability and efficiency.
Stakeholder Engagement: We regularly seek feedback from our stakeholders, including customers, employees, and community members, to ensure that we are meeting their needs and expectations.

C1.2. ESG Risk Analysis of FUWA

-> By addressing these risks through proactive measures, FUWA can enhance its sustainability and resilience, ensuring long-term success while maintaining its commitment to environmental, social, and governance principles.

C1.3. ESG Measurement Framework

C2. Governance Structure

C2.1. Company Culture

C2.2. Stakeholders

We work with and consult numerous internal and external stakeholders through corporate engagement, our supply chain and our products. The feedback we receive from consumers, retailers, non-profit partners, team members, growers and beyond plays a vital role in shaping our decision making. These stakeholder relationships support FUWA’s sustainable manufacturing and business practices.

C3.3. Strategy for measuring ESG objectives

D. Learning curve

FUWA has strategically positioned itself along the smiling curve, focusing on high-value-added activities such as research and development, branding, and marketing. By prioritizing these areas, FUWA has been able to differentiate its product, build a strong brand reputation, and capture a premium price.

Operational Learning Curve

FUWA’s operational learning curve has been characterized by several key improvements:

Supply Chain Optimization: By establishing strong relationships with local pineapple suppliers and implementing efficient logistics, FUWA has reduced production costs and ensured a consistent supply of raw materials.
Production Efficiency: The company has invested in advanced production technology and streamlined its manufacturing processes, leading to increased output and reduced waste. Currently, FUWA owns advanced production lines, shortening fermentation time from 3 months to 1 month and increasing Enzyme density to 5 times.
Quality Control Enhancement: Rigorous quality control measures have been implemented to maintain product consistency and customer satisfaction.

Marketing Learning Curve

FUWA’s marketing efforts have also demonstrated significant progress:

Brand Building: The company has successfully positioned itself as a leader in eco-friendly cleaning products through effective branding and storytelling.
Digital Marketing Proficiency: FUWA has leveraged digital platforms to reach a wider audience and engage with customers effectively. Our products have received positive feedback and high engagement from our social media campaign. We reached over 12,000 reactions and attracted over 100,000 potential distributors and sale agents, indicating strong market interest.
Customer Relationship Management: The implementation of CRM systems has allowed FUWA to better understand customer needs and preferences, leading to targeted marketing campaigns and improved customer satisfaction.