ABOUT US

"NQI" (NQ) was founded ten years ago to develop and market products to address air purification needs of the general marketplace. We are now one of the leading manufacturers of products that deal with indoor air quality (IAQ) issues. We currently have a product line that is targeted to medical health facilities (primarily hospitals), industrial air cleaning and have developed a smaller product line which combines the significant parts of the medical and industrial equipment and markets more broadly to include all commercial buildings. Our products are high efficiency air filtration and sterilization devices, which are generally installed in a standalone fashion. NQI is located in ROCKY Hill, Connecticut, and may be contacted by calling 1-800-837-8650. NQI has grown the business significantly with this new product as there is currently no existing competing product for the target market.

In order for NQI to capitalize on our engineering advantages we will need to expand and control our national channels. I will describe our company through the following elements:

• The Problem
• The Solution
• The Marketing Environment
• The Target Market
• The Competition
• The NQ Difference
• Marketing Tactics / Implementation / Control

THE PROBLEM

Indoor air quality (IAQ) has been a concern for people in the healthcare industry for many years. At the beginning of this century it was discovered that tuberculosis (TB) would spread to other patients in the relatively close confines of a hospital, whereas, the spread of the disease could be checked if the patients were isolated in an environment that provided abundant fresh air and sunshine (the TB sanitarium). Once thought to have been eliminated as a general health threat, TB has made a comeback in a form that is much more resistant to existing antibiotics. TB patients are not only visiting hospitals; they are going to clinics, doctors’ offices, and other public places with confined interior air.

In addition, the roll of other airborne antagonists has been recognized as a contributing factor to poor IAQ conditions. These include molds, pollens, smoke, chemical vapors, bacteria and other infectious agents. The health implications of poor IAQ have given rise to the term "sick building syndrome". There are two basic approaches to improving indoor air quality. One is to exchange the interior air with exterior (presumably better) air. The other approach is to clean the existing interior air. (Obviously, a combined approach could be used.) Many new buildings are constructed with windows that do not open and thus rely on their existing HVAC system (heating-ventilation-air conditioning) to achieve adequate indoor air quality. However, simply moving air around in a building does not improve its quality unless it is either exchanged with outside fresh air or is filtered. Most HVAC systems provide only limited filtration for the contaminants mentioned above and very few actually exchange the air.

The elimination of TB bacteria (mycobacterium tuberculosis) is especially critical due to the severe health implications. However, the basic options are similar; exchange the air or kill the bacteria in the contaminated air. Thus, hospitals have been building "negative pressure" rooms where the air is continuously exhausted and replaced by fresher air. In this way the airborne contaminates associated with a particular patient are not allowed to travel throughout the rest of the hospital. This approach is expensive and is non-portable. Costs to build a typical negative pressure room range from $25,000 to $30.000. The other approach, killing the TB bacteria, requires a relatively high dose of ultraviolet (UV) radiation. UV radiation "filters" can be retrofitted into existing HVAC systems but the cost of this is considerable as well. The marketplace needed lower cost, more flexible, alternatives.

THE SOLUTION

NQI has developed a line of air treatment systems that represent a simple and economical way to bring a room into compliance with the latest guidelines from both the Occupational Safety and Health Administration (OSHA) and the Center for Disease Control (CDC). NQI offers both free-standing (NQ500) (NQ1000/2000) and wall mounted units (NQ250/400) that have various particulate filters as well as UV lamps.

The CDC states that "Air disinfection can be accomplished by ultraviolet germicidal irradiation (UVGI) and by filtration of air, such as through high efficiency particulate air (HEPA) filters." TB bacteria can be killed with a UV dosage of 10,000 micro-W/cm squared or are also generally large enough to be trapped by a HEPA filter.

Carbon filters are also available in some of NQ's products to eliminate odors and volatile organic compounds (VOC's). (NQ1000/2000) (NQ500)

The smallest small wall-mounted unit is 32"x26"x12.5" (NQ250/40) the next largest free-standing system is 78"x26"xl3" (NQ500) and lastly 62"x26"x49" (NQ1000/2000). They are designed with high efficiency fans for maximum air exchange and quiet operation. The units accommodate standard rectangular filters and UV lamps. The use of both a HEPA filter and UVGI provides a fail-safe approach to providing a TB-free environment. While the technologies involved with the NQ products have been available for decades, it is the integration of these technologies into an effective and economical product that represents a real breakthrough. The products require little, if any, installation and can be quickly deployed wherever IAQ is a problem.

THE MARKETING ENVIRONMENT

With the renewed concern over TB infection and of indoor air quality in general, the demand for products such as those offered by NQI is expected to grow significantly. Besides the CDC guidelines for how to combat airborne infectious agents, OSHA has guidelines for reporting "TB infection incidents" and steps that should be taken to reduce the risk of TB infection to employees at healthcare facilities.

In October of 1996 a hospital employee in Connecticut notified OSHA that she felt she had contracted TB due to inadequate control processes where she worked. A surprise visit by OSHA officials confirmed much of her claims. Employment of NQ products was advised and used.

In addition to federal and state regulations relative to airborne infectious agents, there is a concern with the public at large about indoor air quality (IAQ). The recognition of the hazards of "second hand smoke" has lead to the general ban of cigarette smoking in public buildings. However, many buildings continue to have IAQ problems and people complain of a variety of symptoms from the "sick building syndrome".

With the growing realization that it is much more cost effective to prevent someone from getting ill than it is to treat the illness (or go to litigation), expenditures for IAQ are seen as a good investment. In some work environments it is in fact a required investment. With the increasing focus on cost containment in the healthcare industry, the NQ product line is the perfect answer.

NQI continues to gain market share in this segment and are now targeting the commercial building market segment with a smaller product called the Clarifier (CARE2000), which is more aesthetically designed.

THE TARGET MARKET

The target market for the existing medical product line includes all operators of healthcare facilities in the United States. There are about 10,000 hospitals in the United States. Thus, the overall healthcare facility market ranges in the 20,000 to 30,000 area. It includes the operators of not only hospitals but also clinics, doctors offices, nursing homes, and mortuaries to name a few.

When commercial building operators are added, the prospect list numbers in the "hundreds of thousands". Armed with the Clarifier (CARE2000), the opportunities in this commercial building market are virtually unlimited.

THE COMPETITION

There were about 12 competitors that manufacture products similar to the main NQ product line. Only 4 remain in the marketplace today. However, only two had both HEPA and UV and NQI is now the only unit left as a choice. NQI has conducted a thorough competitive analysis and has detailed comparisons of the features of each with respect to the NQ product. The result is a listing of the "23 Points To A Better Unit" for their top of the line NQ500 system (see below).

No competitor has a product that can match the combination of features offered by NQI. Many are actually more expensive and less functional. There is no single vendor who dominates the market so as a result the individual market share is somewhat uniform. Market share segmentation is largely determined by the geographic strength of a particular company. Thus the need to build effective nationwide channels will be critical to the NQI future. As for "The Clarifier", there is no competing product that addresses this market niche; aesthetically pleasing, high capacity air purification systems with carbon, HEPA and UVGI. NQI is studying ways to ensure their continued leadership after this product has been introduced. There are for example Aller Air, Austin Air, Blue Air, IQAir, Sun Pure as competition with out NQI’s features..

As mentioned above, the competitive analysis done by NQI identified 23 ways that their NQ500 product is superior to its competition. These points are:

Small footprint Has passed all ECRI tests
Disconnect alarm (Emergency Care Research Institute)
Standard size HEPA filter
Complete Operators Guide
Locking ball bearing casters 2 year product warranty
54 dB sound level (normal speech)
Easy set up with standard electric cord Has CSA registration
Complete airflow because of height (Canadian Standards Approval)
Smoke detector option for safety
Exhaust option as low as $100
Low operating cost of $377 (430 watts)
Best protection of inlet and outlet vents 3 year HEPA life
Door interlock for service safety
Minihelic pressure gauge to monitor all 3 filters
Hour meter
Economical 55 watt UVGI lamps ($49)
LED monitor for UVGI lamps
Full destruction of %100 of airflow

The three features that most distinguish the NQ products from their competition are:

These are the particular features that NQ uses to position their product in the marketplace. Overall advantage is the superior design and manufacturing engineering. These differentiators have enabled NQI to penetrate the healthcare market where other vendors had already been established. Now they are looking to use "The Clarifier" to expand in their current market and into other markets as well.

In addition to product differentiators, NQI also distinguishes itself by offering fully engineered custom solutions and installation services. Other service offerings include engineering consulting for "sick buildings" or related problems.

MARKETING TACTICS IMPLEMENTATION / CONTROL

The basic marketing objectives are twofold: expand market share in the health facility market (existing installations to date) and penetrate the commercial building marketplace. Due to the geographic nature of the market share distribution, the nationwide sales and distribution channels are going to increase market share.

NQI needs the national network of exclusive, sales representatives and non-exclusive distributors that should cover most major metropolitan areas of the United States. Lead tracking and customer satisfaction measurements will be tabulated and used as well. A variety of sales management programs are available to ensure its continued vitality.

All products either have a track record of satisfied customers or have been thoroughly test marketed. (existing installations to date)

SUMMARY

NQI currently has the best-designed products in the indoor air quality remediation business. The products have been engineered for superior function and economical operation. They represent an attractive option to health care facilities faced with the need to provide indoor environment that is free from airborne infectious agents.

The market environment in which NQI operates is one of great opportunity. The challenges presented by managed healthcare dictate that the players consider economic factors (energy savings with recirculated and filtered air) as well as function in making purchase decisions. The NQ product line is well positioned to address both sides of the buyer’s checklist. The growing public awareness of indoor air quality issues expands the market potentials well beyond the healthcare industry. Customer acceptance of the NQI products in the health facility business has been very good.

NQI IS THE ENVY OF THE INDUSTRY

There is data for almost every aspect of this business, from the OSHA and CDC guidelines to the engineering solutions presented by NQI. This comes across in the brochures and product descriptions as well. The technical data is available from NQI engineering. NQI has made hospitals compliant for a myriad of reasons and is able to suggest a solution quite easily from there past experiences and installation history.

Choose one below for samples of installations

Negative pressure room 1
Negative pressure room 2
Through wall unit HEPA ducting