Business and product development plan for Hydrogen …hydrogenoman.com/docs/brief business plan of...
Transcript of Business and product development plan for Hydrogen …hydrogenoman.com/docs/brief business plan of...
Business and product development plan for
Hydrogen Oman
Done by: Mohammed Al Barwani
General structure of business plan
1.0 Company description and overview of activities.
2.0 SWOT analysis.
3.0 Organization and management.
4.0 Product line and legal issues.
5.0 Marketing strategy.
6.0 Funding request.
7.0 Executive summary.
1.0 Company Description and overview of activities
This is a research and development company that focuses on creating a strong brand of being the
market leader in efficient hydrogen generation. This will be achieved via the kits that the
company develops for medium scale power generation (generators, cars and buses) and the
patents to be sold from continuously improving on the efficiency of those kits ( by employing
experts and professional in the field). The first product to be developed is a kit to be used for
powering an efficient hydrogen vehicle (competing with leaders in the industry such as
Hydrogen London and BMW) through direct combustion (of hydrogen) rather than using water
fuel cells. Further research will be conducted by the company to increase the efficiencies via
other renewable energies (such as solar and others) and therefore develop more patents for sell to
companies around the world.
Mission
To be a global leader in research and development activities related to the efficient generation of
hydrogen gas on demand via electricity and other renewable energies.
Vision
To be achieve global eminence in the development of renewable and clean energy.
Marketplace needs
The world is in demand of energy and this demand is increasing rapidly year by year. Energy
derived from Oil and gas based resources is becoming less popular with time due to scarce
reserves (in many countries around the world) and their polluting effect. As a result, countries
are actively switching toward renewable energies such as wind solar and hydrogen. Even though
hydrogen is the most abundant element on earth and is seen as a valuable alternative in the near
future, its generation has always been very costly and its storage as well. First of all,
conventional methods of generating hydrogen have always resulted in low efficiencies that are
not attractive to the common public. Secondly, hydrogen storage, as well as being dangerous, is
very costly. The product proposes to solve those problems by not only reducing the current
requirements for hydrogen generation via a modern electrolysis technique, but also generating it
at a high enough rate to run a combustion engine.
2.0 SWOT analysis
Opportunities
Hydrogen engines are currently are under development stage and are expected to
overcome the efficiencies exhibited by fuel cells in 20-30 years. Hydrogen engines work
by combusting hydrogen on demand.
Emerging countries in Europe shifting towards the hydrogen infra-structure.
Increasing demand for energy reflected by increase in worldwide energy consumption.
Dramatic shift towards renewable energy in the last decade.
Threats
Companies like Proton are continuously updating their hydrogen generations systems for
medium scale power generation.
Countries which are fully dependent on oil and gas may not adopt the hydrogen
infrastructure any time soon. This may prevent investors from pursuing such technologies
in the short term.
Strengths
The climate in the Gulf countries. With the development of other renewable energies
such as solar energy, those can be used as a stimulus for hydrogen generation, especially
in a country like Oman.
Weaknesses
Lack of high experts in the field of electronics and engine combustion. Foreign expertise
may be required.
Industry description
There are few companies in the world that are involved in the hydrogen generation industry. The
most well known is (in generation) is proton, which specializes in hydrogen generation for
generator purposes via the process of electrolysis. They are also used to feed fuel cells that
generate electricity from hydrogen.
Vehicles that run on hydrogen include employ the fuel cell technology (to generate electricity for
powering vehicles) and are known for attainting a maximum efficiency of around sixty percent.
The market leaders in this are Hydrogen London BMW, Toyota and hydrogen London. At the
moment, hydrogen engines are still under development stage and are expected to overcome the
efficiencies of vehicles running on water fuel cells (that rely on stored hydrogen obtained from
conventional electrolysis).
Target Market
The target market will be generator and car companies who are interested in buying patents
relating to high efficiency hydrogen generation.
3.0 Organization & Management
The company will be a private limited company (Ltd) to start with (later to be converted to a
public limited and listed on the Muscat Stock Exchange). The organizational structure will be as
follows:
At the maturity stage of the company, we would expect more than 200 hundred employees. The
percentage of ownership will be dictated by the terms of the TRC.
Chairman
R&D manager Finance manager Technical director
Deputy Chairman
Marketing and
HR manager
development
manager
R$D workforce
Team of PHD
holders with
ideas. Roughly
a team of five.
Marketing
Workforce
Team of web
developers in
charge of
marketing the
new kits to be
developed. A
team of four.
Technical work
force
In charge of
implementing
ideas formulated
by the R$D
workforce. This will
constitute the
majority (roughly a
team of 150).
Finance work force
Responsible for
managing the
finance and budget
of the company.
Consisting of four
employees.
4.0 Product line and legal issues
Description of product
Kits that produce hydrogen efficiently and on demand, especially designed for generator and
vehicle applications (medium scale energy requirements).
Intellectual property
Using the process outlined in hydrogen generation (as stated on the research proposal paper) is a
trade circuit and non will have the right to produce without the legal permission of Mohammed
Hilal Al Barwani.
Research and development activities
Further research will be done in exploring the use of solar energy to increase the efficiency of
hydrogen generation via the process outlined (as stated on the research proposal paper).
5.0 Marketing strategy
The marketing strategy to be adopted initially is public demonstrations of systems powered by
the kits. This will be accompanied by the establishment of a hydrogen society in Oman and a
website marketing the efficiencies attained by the company’s kits.
6.0 Funding request
For the research and development company, the CAPEX and OPEX costs are as shown in figure
1, with the CAPEX costs involving the cost of developing the kit (as indicated in the proposal
form and funded by the TRC ) and developing a hydrogen car ( from personal funding , investor
or selling a patent ).
1st year (cost of kit development, to be
funded by TRC )
2nd year ( maximum
cost of developing a hydrogen run
by the kit)
3rd year (maximum cost of developing other
kits)
Total (R.O)
CAPEX 2830 7000 90170 100000
OPEX (maximum cost: of rent and employee expenses)
82080 82080 135840 300000
TOTAL (R.O) 85000 89022.6 226010 310000
CAPEX AND OPEX EXPEDITURES
Item Expenditures quantity Maximum Cost
1 USB Bitscope oscilloscope 1 $465
2 Model 4012A MHZ Sweep Function Generators 2 $3395
3 Xilinix Spartan-3E XC3S500E FPGA development BORAD 2 $79.99
4 USB JTAG platform programmer 2 $20
5 Pintek DP-25 ( probe for high voltage) 1 $212.70
6 10 MHZ DDS Function Signal Generator Module sine 1 $106.00
7 30V 5A Adjustable DC Power Supply LED Display YIHUA 305D 1 $62.99
8 Large 1.4"/2.25" Iron Powder Toroidal Core - T 225A 2 2 $26
9 Digital 4 decimal high precision mass balance ( 15 kg max) 1 $100
10 IWATSU SG-4101 FUNCTION GENERATOR TESTED GOOD 2 $700
11 Radio Amplifiers 1 $200
12 Chemicals ( for anodizing the electrodes) 1 $1,500
13 anodizing equipments 1 $100
14 Wiring connectors 1 $100
15 PC's for recording measurements 1 $300
16 Workshop rent (for eight months) 1 $16,000
17 Technical support ( for eight months) 1 $200,000
18 Miscellaneous ( including safety equipments & generators) 1 $3,000
Total costs for year1 (R.O)
84910.12
Total
$223,448
Item Expenditures quantity Maximum cost
1 flash back arrester 2 $20
2 One way check valve 2 $30
3 Small hydrogen regulator(2-3 bars) 2 $20
4 ECU combustion kit 2 $200
5 Hydrogen tube 2 $10,000
6 Car 2 $8,000
7 work shop rent 1 $16,000
8 Technical support 4 $200,000
Total costs for year2 ( R.O)
89022.6
$234,270
Item Expenditures Maximum cost
1 cost of developing other kits $237,289.47
2 work shop rent $31,578.95
3 technical support $325,894.74
Total( R.O) 226010
$594,763.16
Figure2. CAPEX and OPEX expenditures for the first, second and third years respectively.
Forecasted Cash Flow Statement in quarters ( every four months for next three years)
1st 2nd 3rd 4th 1st 2nd 3rd 4th 1st 2nd 3rd 4th
Cash Inflows
Total Cash Inflows 0 0 0 0 70000 0 0 0 500000 0 0 0
Cash Outflows
rent and salaries 21250 20520 20520 20520 20520 20520 20520 20520 33960 33960 33960 33960
equipments 2830 0 0 0 7000 0 0 0 9017 0 0 0
others 0 0 0 0 0 0
total cash outflow 24080 20520 20520 20520 27520 20520 20520 20520 42977 33960 33960 33960
Opening Cash 0 0 0 0 0 0 0 0 0 0 0 0
Net cash flow -24080
-20520
-20520
-20520
42480 -20520
-20520
-20520 457023 -33960 -33960 -33960
cumulative net cash 24080 44600 65120 85640 43160 63680 84200 104720 352303 318343 284383 250423
Figure3. table illustrating the forecasted cash flows
The increasing demand for clean energy in the world, as well as the shift from water fuel cell
technology to hydrogen engine development ( which rely on direct combustion), is the reason for
starting this research and development company, which is specialized in developing kits for the
Figure4 table illustrating the forecasted cumulative cash flows with time
7.0 Executive summary
-200000
-100000
0
100000
200000
300000
400000
1st 2nd 3rd 4th 1st 2nd 3rd 4th 1st 2nd 3rd 4th Cu
mu
lati
ve n
et
cash
flo
w(
R.O
)
Time ( in units of quarter or every four months )
Forecasted Cumulative cash versus time
Cumulative cash versus time
Break
even time
≈2 years
efficient generation of hydrogen. In the long term, this enterprise may drive the energy future of
the world as societies move away from depleting oil and gas based resources.
Appendix
.
The electrical
control module
The hydrogen generating element of
water splitter device
The frequency control
module
Picture of the prototype to be developed.
Figure4. picture of the first prototype to be developed