We are the #1 Group Procurement Organisation (GPO1) focused on retail and professional products created by talented spinoff engineers with a clear biotechnological background. Our GPO consists of independent retailers and private manufacturers with own production facilities/ staff/ offices/ warehouses/ training premises/ points of sale in 75 countries and purchasing volume €368 mln/year. We buy only brands with 100% clear USP. We pay only cash up front. GPO members are passionate longevitists that united to leverage novel unique product scouting, purchasing power, obtain better discounts from vendors, secure exclusive distribution rights on the brands, speed up all the processes and make them time, resources and costs effective. The focus of GPO is on brands utilizing the latest cutting-edge biotechnologies that radically enhance human healthspan. In case of an urgent need for a non-existent product with a great potential demand that fills a certain gap on the market, GPO can invest or co-develop brands from scratch.
Who are spinoffs?
Spinoffs are ultra-experienced and highly talented Senior Western Engineers/Technologists who have previously worked for many years for global corporations accumulating significant knowledge, expertise and connections in their field. At some point driven by an inner desire to apply a revolutionary idea that cannot be implemented within the framework of the multinational corporation for a number of reasons, they decide to spin off and establish their own private businesses to develop and apply new revolutionary solutions (maybe a substitute of the former competitors).
What is GPO and its main benefits?
Group Procurement Organization (Einkaufsgemeinschaft2 in German) is a model of procurement, known in the German industry since the end of the 19th century, where the members are independent businesses that act as a group with the collective buying power to get various benefits through a common purchase.
GPO provides its members:
- Turnkey portfolio of unique high-margin brands and its constant updating;
- Access to deeply discounted, pre-negotiated contracts;
- 100% distribution exclusivity for each particular market;
- Diluting risks and marketing expenses between all members;
- Improving a part of the procurement chain;
- Increasing speed to market and speed to profit;
- Benchmarking, audit and analysis of similar activities within the GPO structure to identify errors and to avoid the principle “learning by doing”;
- Multiple compensations in case of the independent brand exit;
- Centralized advanced group training, offline and online seminars, open tables etc.;
- Support with logistics by importing/exporting goods within the EU/CIS/Turkey;
- Just-in-time (JIT) deliveries directly across the EU/CIS/Turkey;
- Opportunity to save money on freezing VAT through own dropshipping possibilities within the EU/CIS/Turkey.
GPO provides spinoffs:
- Big volumes of purchase;
- Contract-guaranteed projected demand;
- General conditions and discounts for all GPO members;
- Protection against cross-border selling and client poaching;
- Reduction of operational costs on the search for potential distributors in each market separately;
- Real customer checks and charge-free market assessment, competitors and pricing evaluation from 75 markets within BRAND LAB;
- Zero time to market;
- Dynamic growth and a rapid increase in cash flow.
GPO terms and conditions for procurement
All GPO members buy ready-to-market products created by spinoffs at the same purchasing price with cash up front adhering to common distribution terms and selling in their markets. Despite the fact that the volume of purchases and discounts, based on total purchases by all GPO members, are negotiated, the procurement contracts are concluded with each individual member of the group for each separate market. Brand owners mandatory conclude a five-year exclusive distribution agreement with each interested member for his core market with the possibility of prolongation for at least five years, subject to the fulfilment of the agreed annual purchase volumes by GPO members. Accordingly, the buyer pays the supplier and receives the products directly according to the terms of the contract. Such a contractual division allows simplifying the procurement procedure and properly building financial relationships between the parties.
We are the first worldwide who were forced to introduce such GPO extension. Only if GPO sees an urgent need or unrealized product gap in the market, it can enter into a deep collaboration with an independent manufacturer to create own private label products from scratch addressing market needs. Through our product development Project Büro, spinoff.com, we identify, recruit, and allocate talented ultra-experienced engineers from parent companies for new product creation. Under their strict supervision, our Project Büro manages the entire product development and production setup, ensuring these engineers further become stock- and shareholders with various rights, including voting power, ownership, dividend claims, and legal privileges. GPO is guided by the fact that there is already an existing customer base who need this product in all markets of operation and are ready to buy it. It is very important that GPO does not consider the subject of copycats. Representing the interests of the market directly, GPO develops the products only after careful market assessments by all members within the framework of BRAND LAB through market testing and surveys of all GPO members.
The novel brand evaluation process consists of:
- Feedback from all GPO members;
- Careful evaluation for such a demand;
- In-depth analysis of all GPO markets and assessment of all conditions;
- Product validation checks and concept marketability in all GPO markets.
The novel brand production process consists of:
- Search for spinoff engineers/technologists for the implementation of projects to create new products;
- Very generation and selection of ideas;
- Concept development and verification;
- Marketing and sales strategy development;
- Business analysis;
- Product development;
- Trial marketing;
- Full-scale commercial production;
- International certification, marketing, logistics and sales.
GPO members plus spinoff engineers who have mutually developed the brand share all marketing costs and additional expenses on the development of such brand among the participants. In such a case, all rights on this brand 100% belong to the GPO members plus spinoff founder who led the product development. In case of deep integration into product development, the right may be also shared with the manufacturer/brand owner.
How does GPO secure the rights for co-owned brands?
Since GPO plus spinoff co-develop private label from A to Z completely at own expenses, they retain full rights to the trademark, as well as intellectual property rights and remains unbound to the location of the production facilities. In case of the exit of such a brand, the GPO and spinoff receive an entire 100% compensation, that is distributed among the members who created and sold the products of this brand. The rest of the shares are divided between GPO members who were involved in its sales, in the percent ratio tied to purchasing volume.
Which brands does GPO work with?
The focus of GPO is on brands utilizing the latest cutting-edge biotechnologies that radically enhance human healthspan.
MUST HAVE FOR BRANDS:
- innovative products developed by spinoffs, skilled former engineers/technologists originating from corporate environments;
- 100% USP applying the latest innovations and scientific technologies;
- a clear product strategy of how the product enhances human healthspan;
- proved results based on clinical trials;
- high margin;
- big potential market;
- the brand owner is ready for an aggressive S&M strategy;
- the brand owner doesn’t plan to sell the brand for at least within 24 months.
All GPO brands could be downloaded as Biotech Brands Report in the convenient .pdf form with just one click.
How does GPO work with brands?
GPO has a very simple procurement chain, where there is an independent brand created by a spinoff engineer on one side and there are GPO members on the other. In the middle of this chain, there is a centralized office with an in-house international team for the effective GPO process house. The centralized team scouts for the new biotech brand in the portfolio, applying online and offline channels (member’s recommendations, mass media, social media, exhibitions, etc.) and selects the best brands according to generally accepted requirements as stated above. It starts with market assessment and at the request of the brand, excludes the markets where the brand is already being sold or has exclusivity. After the market assessment, GPO tests the products for short, middle and long-term performance within the BRAND LAB by a group of professional medical doctors and technologists, who either own retail companies or work for them and have the necessary competence.
After the existing portfolio assessment, the centralized team personally informs GPO members in 75 markets about new potential products and updates them with all news with the help of special personal notifications. Based on the GPO member's request and feedback, the team arranges online conference calls between the parties. At the final stage, after the presentation and warm introduction by the team, all communication is transferred to GPO members for further direct interaction. Also, in some cases, the team helps with the provision of business samples to GPO members, at their request, as well as with certification, sales and marketing and international go-to-market strategy, customer check and product demand in all markets. Usually, after the preliminary online conferences and meetings between the interested parties, if the situation permits, GPO members hold a personal centralized meeting with the brand where it is more convenient for everyone, to define all the conditions and sign spinoff brand-GPO member direct contracts.
SPINOFF.ORG PROCUREMENT PLATFORM
As a standard, for the convenience of GPO members and spinoffs, we developed the Spinoff.org platform that works as a modern assessment tool to secure time and resources. The team compiles dossiers using the information provided by spinoff brands, that is shared among GPO members in a convenient electronic form with the well-remembered perpetual link by any modern means of communication. The platform has 10% of visible information, available to all, and 90% of invisible information, secured under the password and available only to GPO members. This detailed information allows GPO members to make own assessment of brands in the GPO portfolio and also to observe the assessment of others, as well as work with products of spinoff enginers directly in the "all in one place" format, or work as a group on solving some problems or within the framework of best practices discussion.
The platform has a highly reliable level of protection since all information is located on our own physical secured servers based in Germany. Spinoff.org has its own video streaming. Tailored smart software ensures high-speed uploading/downloading unlimited number of documents, including videos, to any device, with any operating system, in the highest resolution without the risk of viruses. It also allows tracking all viewed /downloaded information flow based on IP address, which gives the opportunity to secure all sensitive information.
How the GPO is financed?
GPO is funded by:
- Annual flat rate by the GPO members (only €499);
- 10% equity belongs to the GPO when it creates its private-label brands in case of urgent need;
- Sometimes, there are situations that the brands, that GPO worked with, are bought out by MNCs. Since MNC has its distribution network it will no longer work with GPO, and at the same time taken along with the brand our customers. Therefore, we lose a fairly large part of the client base, the revenue from them and have to start working with a novel brand from scratch. Since GPO members have invested in this brand a large amount of financial and other resources for its development and promotion, it can count on some kind of compensation. In case of loss of distribution rights and customers, the member of GPO receives compensation from the brand in the amount of cashflow with the brand for the last 12 to 24 months. We receive 10% of the total amount of compensation to cover all legal, court and other expenses;
- In particular cases, if the young brand doesn’t have enough money to develop international sales, instead of selling a part of the company or attracting other financial means (e.g. from venture funds), GPO ensures cash up front payment with large leverage of up to 3 months and protects the brand owner against company diluting. In this case, GPO can count on a small share of brand equity upon reaching a certain volume of cash upfront purchases. We call this “Sales for Equity” (this definition was introduced for the first time by the Head of the GPO Dr.Alexander Miller);
- Also, in some cases, if there is a need, we can act as direct investors, allocating financial resources to create a brand.
Who are GPO members?
GPO members are the passionate longevitists who buy the products by spinoffs i.e. direct/indirect retailers and private manufacturers in each individual home market. Each GPO member out of 75 countries has a legal entity/ staff / offices / warehouses / training premises/ production facilities/ budget and it is desirable to have at least one or more points of sales or POS (e.g. own clinics, offline and/or online stores, beauty salons and do distribution themselves or network with other local retailers/professional distributors). GPO doesn’t cooperate with entities which act only as distributors or agents and do not sell anything directly to customers and do not have direct access to them, as well as with any other forms of the middleman.
Each GPO member is independent of the others and decides on his own whether to work with the brand from the GPO portfolio or not according to his financial sources and capabilities. It is very important that all members of the group have equal rights regardless of any factors. They interact with each other exchanging best practices, new trends, experiences, marketing and sales statistics and feedback on brands in the portfolio. These connections have been accumulated over many years in corporate business and operating in the healthcare and aesthetic medicine industry.
Who can become a GPO member?
- Large-sized online/offline retailers with a big amount of own POS who do not have time for scouting new independent biotech brands and who also want to protect their rights in front of the MNCs;
- Middle-sized online and offline retailers with their own POS that do distribution themselves or with other local retailers, who want to scale sales to be able to compete with big wholesalers/MNCs on more favourable terms due to larger volumes of sales in more markets. GPO can provide economies of scale due to a large volume of production and purchasing and immediately come to savings and low cost from a large volume of production; GPO can also control the contract production, support with certification and logistics locally;
- Small-sized companies that just started retail or professional distribution businesses in such industries as biotech, big and small pharma, medicine, medtech, nutrition, superfoods, wellness, beauty and more, and have enough financial resources, but don’t have a proper brand portfolio, it is not balanced or have a gap in it; feel lack of the competence to properly built sales. For such companies, GPO can prepare a turnkey portfolio from scratch or audit the existing one and fill in the identified gaps, as well as build all parts of the Process House completing the competence gap e.g. in product manufacturing, logistics, marketing and sales, contracting, work with suppliers etc.;
- Private manufacturers;
- In exceptional cases, professional individuals who are passioned longevitists aimed at healthspan enhancement, who have a certain fundamental competence or a number of competencies (for example, MD or cosmetologists), and financial resources to start their own retail or professional distribution business in given areas, but have a certain gap in other competencies as well as product’s portfolio. In this case, GPO can help to build their business and portfolio on a turnkey basis, to train, support with all its aspects and help to complete the lack of competence, in turn, enriching the GPO with other existing competencies.
For effective interaction between all members in 75 markets and global spinoffs, GPO has several offices with warehouses in Europe and Asia. There is a head office in Burgas, Bulgaria that coordinates all strategic, marketing, legal and financial work between the brand owners and GPO members and is engaged in the BRAND LAB, production and procurement projects in 24/7 mode. There is a logistics and certification centre in Burgas port, Bulgaria and Istanbul, Turkey that supports GPO members, if needed, with import-export, logistics, customs clearance and certification (e.g. CPNP) within the European Union and Asia. There is an office and logistic hub in St. Petersburg that covers CIS and Eastern Europe with an in-house team and salespeople that deal with all aspects of logistics, e-commerce, communication, marketing and PR. The office in Vienna deals with legal issues, certification and trainings. There is also a medical, scientific, and training center in Madrid, Spain which helps GPO with the development and testing of new products.
We would like to stipulate that the Group Procurement Organization consists of and is regulated by its independent members that represent a single buying power. We are not any kind of agency or consultants, since all members BUY products from independent biotech brands CASH UP FRONT and SELL in up to 75 markets, respectively risk with their own money and reputation the same as the owners of spinoffs. We are open to discuss any possible forms of cooperation and partnership. Please, send your inquiry to the following email firstname.lastname@example.org, give us a call to +359 88 777 5929 or chat online with our specialist right away.
You will find more detailed answers to all questions in the FAQ section.