Extend Fertility Case Study

714 Words Mar 7th, 2016 3 Pages

AD740 Planning and Opening New Ventures
Professor: Steve Leybourne

Christy chose this industry from listening to her inner voice and needs. She devoted herself to her career and passed the peak time of fertility. She was trying to find a way to balance having a career and a family. Reading of Hewlett’s book and discussion with Christy’s friends about fertility treatment inspired Christy brought her interest in digging in the fertility industry. At that time, some medical research center started to offer freezing egg services to cancer patient before chemotherapy. Christy thought this technology could benefit professional women who often delay on serious relationships,
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Extend Fertility offered storage services to their clients by partnering with a secure cryopreservation facility. Also, the company promoted its business by educating potential customers via its programs and activities. Extend Fertility generate profit from egg freezing product, license, and consumers service fee and payment from fertility clinics. The company collected ongoing storage fee and about 40% of the total cost of the procedure. The rest of money would split between medical clinics and pharmaceutical. Christy expected 80% gross margin on the services provided by the company.
The business plan with such high gross margin seems quite favorable. However, the company’s concept has some potential problems. The company did not mention how to minimize the risk of hurting women’s health when they proceeded to collect their eggs. Furthermore, the business plan did not include the best use time of the storage eggs. If the eggs were expected to keep in years, the quality of eggs could not be ensured. Finally, they did not offer a strong report to state the potential issues of using freezing eggs. Would the technique influence the health of babies?
The competitors were the local fertility clinics. The largest clinic had eight doctors and took 5% market shares. Some of the clinics were able to similar services to Extend Fertility but were at the disadvantage to the company. The firm was the only one got FDA proved

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