PART 2 - CURRENT PRODUCT

This section addresses J&B Incorporated's Initial Product, Additional Development Costs, and Sequential Objectives.

A.   Initial Product:
The Company's initial product can be characterized as an extensive business training course that provides users with the prerequisite skills and knowledge needed to own and operate their own business venture. The product comes in four (4) forms; diskette, compact disk, Internet and hard-copy form. The first three forms are considered software and therefore require the product to be used in conjunction with a computer. The hard-copy form contains the same training information as the above forms and consists of over 1,500 pages of text, bound into a booklet form. Since the hard-copy form is printed on paper, it does not require the use of a computer. The company, however estimates few sales of the product in hard-copy form and as a result has elected to exclude such sales and associated costs from its forecasted financial statements. Moreover, we wish to concentrate on selling the product as software - IE Diskette Form, Compact Disk form, and Internet Form.

The course is intended to assist individuals in starting their own business venture. The initial product/software will provide in-depth discussion on the following topics;

The software uses a highly sophisticated, yet simple, technology called hypertext. The hypertext technology, links data from one source to another, allowing users easy and immediate assess to the business information contained within the software. In a less technical sense, a user maneuvers through the business training program by pointing and clicking their mouse on words or phases seen throughout the database of information. Upon "clicking" on a word or phase, the computer immediately provides the user with information on that topic.

The training information has been organized in six (6) main steps which allow users to rapidly learn and understand a variety of business concepts, terminology, laws, regulations, business principals and strategies. Below lists the six (6) steps in which the program has been organized.

Below briefly describes the information contained within each of the Six (6) Steps. For detailed information on the topics addressed here (particularly Steps 3 and 4), please refer to Appendix # 3.

Step 1 - Do You Have What It Takes
This section addresses the various skills and characteristics that most entrepreneurs share. It also provides three questionnaires which users may complete to assist them in determining where they stand on the entrepreneurial scale. The main purpose of this section is to communicate to readers that entrepreneurs are not born, but rather are sculptured.

Step 2 - Finding a Business Idea
This section begins by discussing twelve sources for finding a business idea. Part 2 of this section provides readers with over 1,000 business ideas for part-time and full-time home based businesses. And finally the section ends by discussing the difference between a business idea and an opportunity.

Step 3 - Business Training and Skill Development
The business training and skill development section is the most detailed section of the course. It provides readers with training in the areas of marketing, finance, management, human resource development, business operations, and strategic planning. For detailed information of each of these topics, please refer to Appendix # 3.

Step 4 - Writing a Winning Business Plan
This section begins by discussing the purposes of a business plan and how creating a business plan can benefit a new or an existing business venture. In addition, this section gives not only complete instructions on how to write a business plan, but also enables the novice to understand the entire business planning process. We have also developed three (3) complete sample business plans so that the reader can see how the "final product" should appear. For detailed information of each of these topics, please refer to Appendix # 3.

Step 5 - Financing a Business Venture
This section begins by discussing the importance of determining a businesses' capital needs. Part 2 describes the three classifications of capital (debt, equity and venture). Part 3 describes twenty-five (25) sources of financing a business venture. And finally Part 4 discusses how to receive information on all government funding programs geared towards new and existing businesses. (many people spend in excess of $1,000 for this free information).

Step 6 - Checklist to Starting a Business
Step six (6), the final topic on our product's main menu, provides readers with a listing of over 200 questions that should be considered before establishing a business venture. These questions have been organized by functional areas that address several marketing, operational, strategic, managerial, staffing, and financial considerations. A hypertext link has been created for each question so that users can immediately access information on those questions that have been left unanswered.

In essence, the above six (6) steps comprise the product's "main menu". Users can point and click their mouse on any Step or topic from the main menu and immediately the computer provides detailed information on the selected topic. Many of the Steps have sub-menus which allow the user to narrow their information search. For instance, a user may click on Step 3 - "Business Training & Skill Development". Upon doing so, their computer immediately produces a sub-menu similar to the one presented below.

Assuming the user wants to learn more about Marketing, he/she would simply click on the "School of Marketing' and immediately the following sub-menu appears on their computer screen.

Now the user can choose any of the topics listed above. Lets assume the user has developed a product and doesn't know how much to charge for it. He or she would simply click on the topic "Setting Your Price" and immediately a thorough discussion on general pricing approaches, pricing strategies, and consumer buying behavior appears on their screen. In essence, this information provides them with major issues to consider when setting a price for a product or service. The user can print the material or read it from their computer screens.

In closing, the Company's initial product currently contains over 1,500 pages of business training information. It consists of six main steps, organized in a easy to follow format. Moreover, the format assists individuals in determining if they are "cut out" for the world of business (step 1 - Do You Have What It Takes). If so, individuals may use step two (2) to isolate a business idea and opportunity (Finding a Business Idea). After finding a business idea, we provide them with business training in the areas of marketing, financial, operations, management, human resource development and strategic planning (step 3 - Business Training & Skill Development). After receiving proper training, we show customers how to develop a business plan (step 4 - Writing a Winning Business Plan). We then show the customer how to use their business plan to receive financing. (step 5 - Funding Your Business Venture). And finally, step 6 completes the entire process by providing a checklist of questions they should consider before opening their business doors (step 6 - Checklist for Starting Your Business).

Please refer to Appendix # 3 for a complete description of the business training course. In addition, please refer to Appendix # 4 for a detailed look at the product's features and benefits.

B.  - Additional Development Costs Required

Management has been researching and developing this product for two years. The format has been established and much of the training material has been developed, however, additional business training content must be written and edited before it can be brought to the marketplace. The development phase is expected to last four months; beginning in January 200W and ending in April 200W. Below lists each development item and associated cost as well as the month (s) in which the cost is expected to be incurred.

The Company must invest $47,772 in development costs before the product is fully functional and ready for consumer use and distribution. Over 55% of these costs involve labor. Furthermore, labor is required for additional writing and editing of all selected training topics. When the writing and editing function is complete, the Company will work closely with B.H. Computronics to transfer the "written" material into a Diskette and Compact Disk format (program/software writing - see above). In addition, the Information Technologist will be hired in March, 200W to transform the written text into an Internet Form. The software products (diskette, compact disk, and Internet forms) will than be tested for defects and to ensure each form is completely compatible with all types of computer systems. After testing is complete, the training software is ready for the marketplace.

As indicated in the forecasted financial statements, the development costs will be capitalized and amortized over the estimated useful life of the product (3 years). Please note, the above development costs do not include computer equipment purchases of $7,602 nor office furniture purchases of $1,412. These asset purchases will commence in January, 200V. For further information on the above development costs, please refer to NOTE 18 of the Company' s "Notes to the Financial Statements".

C.   -  Sequential Objectives:

The following objectives will be achieved during the period between January 1 and April 30, 200W

1.   Apply for and receive approval for the Equity Investors Incentive Program
2.   Apply for and receive approval for Rental Incentive Program
3.   Acquire Initial Equity Capital
4.   Acquire Short-term Bank Loan (matching equity capital)
5.   Rent Office Space
6.   Order Initial Capital Assets
7.   Hire and Train Initial Staff Members
8.   Begin Further Development of Product
9.   Obtain Credit Card Merchant Status
10.   Product Content Completion
11.   Transform Content into Product Forms (diskette, cd, Internet, hard copy)
12.   Test Software for Design and Technical Flaws
13.   Set-up Toll-free Line and Recorded Messages
14.   Design Pre-testing Marketing Coverage and Dialogue
15.   Design/Purchase Ordering Software and Database
16.   Acquire a Business number, Exportation Status, and Insurances
17.   Apply for and Receive Copyright on Product

After management and the staff members have achieved these objectives, the Company is ready to begin its two month Testing Phase. During this phase, J&B will order inventory, promote in selected media, "test" selling strategies, compile and analyze test results, and revise selling strategies. After the testing phase is complete, the Company will hire additional staff members and begin full promotions & production.