Retail Distribution

1. RetailDistribution

2. Experience…one reason why MFLS has earned the enviable reputation as a leader and innovator in this field. Motivational Fulfillment and Logistics Services was founded in 1977 and is still operated by Hal Altman and Geoff Landon. Our Supervisors, Account Executives and the majority of key warehouse personnel average over twenty years of employment with MFLS which gives the company strength and continuity. Experience Spells Success Nearly 3 Decades Of Customized Fulfillment And Retail Distribution “That spells success”

3. Effective Supply Chain The ability of an organization to effectively move and store materials from and to a complex network of suppliers and end users is not a simple task, and the success of any world class supply chain is heavily dependent upon the effectiveness of its logistics network and delivery capability; in essence, its logistics function, comprised of inventory, warehouse, and transportation management. WHY YOU NEED A 4PL ! Whereas traditional 3PL providers mainly focus on transportation and logistics, 4PLs, such as MFLS, provide a wide range of value-added services that can range from business process analysis to hand work such as assembly, packaging and configuration. • A 4PL brings together and centrally manages the complete supply chain for a company to provide a single supply chain solution. • A 4PL simply put is your Supply Chain Management solution resulting in lowered overall supply chain costs due to planning and focus on direction. • There are essentially three goals of The MFLS SCM Team: • To control inventory • To increase the speed of transactions with real-time data exchange • To increase revenue by satisfying customer demands more efficiently

4. Facilities and Function • MFLS offers a wide range of automated machines and custom designed packaging, including shrink wrapping, tape and heat sealing, corrugated, paper cold seal packing to both personalize and reduce packaging and shipping costs. • MFLS specializes in assembly line customized client packaging, pick and pack and multiple item orders. • MFLS' 83 docks are equipped with mechanized metal dock equipment and our receiving and unloading hours are tailored to the trucking industry. • Each phase of our fulfillment is designed to reduce processing and shipping costs while improving consumer acceptance and response to your project. • Our 800,000 square foot facilities are fully secured with a sophisticated camera security system featuring infrared motion detectors.

5. Recognized Compatibility • MFLS Warehouse Management System (LogistiShare) is an advanced warehouse management solution offering solid performance and reliability, developed to enable unlimited scalability and flexibility, assuring compatibility with our clients. • There are a tremendous number of varied requirements that have to be met and no two retailers have the same requirements • Motivational has the flexibility and technology to accommodate your retailers requirements. • Our warehouses are outfitted with sophisticated equipment and the newest technology utilizing true real time Radio Frequency scanning and printing, thereby allowing immediate visibility to our customers for receiving, order preparation status, departure information, freight costs and inventory status. All visible in real time and accessible by our clients from Motivational's Client LogistiShare website via the web, anywhere and anytime. • In 2004 Motivational was selected as one of the top 10 Logistics providers to Wal-Mart and an award winner with Target as our client list continues to grow our list of retailers expands to include the top 100 retailers in the country.

6. EDI Solution and Support • MFLS understands EDI and through integration provides an easy-to-use web delivered platform that makes it possible for small, medium and large businesses to meet retail compliance requirements and manage large supply chains. • MFLS openly advises clients of EDI solutions available and the relationship to the VAN used to translate the EDI data. It is MFLS’s belief that the client should retain control of their EDI solution when possible. We walk our clients through their options and help them make the choice that best fits their business model. Once a decision is made we can help facilitate the setup at a great discount between the EDI partner and our client or integrate to their solution. Clients who own their EDI solution and are able to utilize it as their business grows. Our clients benefit from this direct connect solution avoiding hidden charges by companies who claim to do in house EDI or those who actually do their own and pass along those fees to clients. • For companies of any size our easy-to-use EDI solution offers clients the solution to achieve full EDI compliance in a matter of weeks economically. Small-to-medium sized companies are empowered to easily establish trade relationships with an ever increasing number of retailers and buying organizations. • Our EDI solution comes with a 24-7 live support team that is ready to answer questions or resolve issues when they arise with support services worldwide and on–demand training problems are solved quickly. • It’s an exciting time in the EDI industry, and MFLS is proud to give you the assurance that we understand your EDI challenges and look forward to demonstrating our ability to help optimize the supply chain for both buyer and supplier. We welcome the opportunity to be part of your EDI team!

7. Implementation CLIENT

8. A. Warehouse Tour • Receiving • Returns • Shipping • Pick and Pack • Back Stock • LogistiShare • Setup and Implementation

9. B. Process Partial Orders • Orders if necessary can ship with backordered lines. These lines create a backorder table which can be viewed by clients on LogistiShare. • Backorders can be released full or in partial or closed • Parent to Child relationship is retained for the backordered item by linking subsequent orders to the master order.

10. C. Radio Frequency • Radio Frequency (RF) live data scanners are used through the day providing updates in real time to both Motivational systems. • Process controls allow users to link pallet tags to outbound orders providing lot control and tracking.

11. D. EDI Capabilities • Inbound/Outbound EDI file protocols include: • X12 (940/945) (850/856) • Fixed-position flat file • Tab-delimited • XML (via FTP or Web Service Call) • EDI connection methods include: • Integration with your own in-house systems • Integration with 3rd party EDI service providers (MFLS is pre-wired with DiCentral) • Web serviced EDI via Web only Providers

12. E. Receiving Process Flow

13. F. Customer Returns • Vendor Returnsare sorted according to client specifications and consolidated from multiple locations with the same RA number. All documentation is stripped from return and attached to arrival document.. Goods are received as damaged until inspection or refurbishment can be performed. • Warehouse Vendor Returnsif returned from the DC level or carrier return for product that has not made contact with consumers can be returned according to client specification as good stock and should be first in line for movement out of the warehouse. • Defective Productscan be consolidated and returned to vendors on your behalf so that you can be compensated in either new products or repayment. • Refurbishmentis performed at clients request by labor hour or by quotation.

14. G. Receiving Exceptions Report

15. H. Item/Location Report

16. I. Physical Inventory Process • [ ] Backup data files. • [ ] Clear any items in transit • [ ] Cycle count adjust any discrepancies • [ ] Run a summary copy and detail tag listing • [ ] Freeze Inventory • [ ] Assign count teams to rows and print cycle count check sheet by row • [ ] Determine items to count percentage / all. • [ ] Begin 1st count using MFPS Edge Count Sheet Report. • [ ] Enter the physical count information. Use the Physical Counts Tag Entry function to enter the counts recorded on the cycle count check sheet. • [ ] Run calculation to determine discrepancies. • [ ] Determine items to recount. Perform recount. • [ ] Enter the physical recount information. Use the Physical Counts Tag Entry function to enter the counts recorded on the cycle count check sheet. • [ ] Print and review the Variance Report for the batches as part of the audit trail. • [ ] Post physical to archive old data and set beginning balances. • Define Team 1: [ ] [ ] [ ] [ ] • Define Team 2: [ ] [ ] [ ] [ ]

17. I. PI Process continued Physical inventory refers to the sighting, tagging or marking, describing, recording and reporting inventory on hand.  After completion of the physical inventory, The Inventory Control Manager is responsible for reconciling any differences.  A physical inventory of all property will be conducted in accordance with specific plans and schedules. The objective of conducting any physical inventory regardless of methods of frequency, is to provide both the company and client with the reasonable assurance that inventory is controlled and the records are accurate. • The Account Manager should be responsible for:  • Establishing a master schedule, which sets the beginning and completion of both the physical count and the reconciliation. • Assuring the adequacy of the physical inventory plan and that the physical inventory is properly taken, reconciled and posted to the property records systems. • Areas the Inventory Control Manager may be assigned to accomplish are: • Submitting an annual inventory plan to Account Manager. • Oversight of the physical inventories. • Reconciling the inventories. • Reporting the results. • The following guidelines must be followed when conducting a physical inventory: • The personnel who perform the physical inventory count are not to be the same individuals who maintain the property records or have custody of the property. • All physical inventories must be taken from the floor to the records, not from the records to the floor. • Physical inventory count documents and any reconciliation actions taken are posted to the appropriate accountable records. • Count documents and all listings of adjustments must be retained for four years after final payment of the applicable contract. • The Inventory Control Manager should submit the results of the count within 5 working days. The report will further identify all discrepancies disclosed by the physical inventory and will include: • A signed statement that the physical inventory has been completed, • the date of completion, and • that the inventory was found to be in agreement with the Clients Records Systems except for the discrepancies noted.

18. J. Kitting Process • We offer many value added services providing 30 years of experience. • Kitting projects are either run by estimate with sufficient time study or by labor hour. • Slap n Ship • Kitting • Labeling • Re-boxing • Refurbishing • Shrink-wrap • Display Assembly • Gluing • Mounting • Folding • Rebate Programs • Reverse Logistics RTS • Quality Control Inspections • Testing • Vendor Compliance • Packaging • Cross Dock Programs

19. K. Open Orders Report

20. L. Shipping Manifest

21. M. Rework & Special Projects • Our assembly and kitting services can help control costs by saving labor, overhead and inventory costs. We are able to support your special projects with quick turnaround times and flexibility to include: • Rework/salvage of obsolete inventory • Packaging projects and special one time production runs • Short runs • Special projects • Assembly work that doesn't fit your production process • Hand assembly, sub-assembly, pick and pack services, sorting, product labeling, and bar-coding • Rework or inspection to include electrical testing • Quality Control • Re-skin goods for Retail • Kitting goods in many configurations to meets sales expectations

22. N. RTV Process • The Return to Vendor process is fully initiated by the DC or Retailer. Merchandise is returned to the warehouse in one of two ways: • Client issues a RA number which the retailer uses when returning the freight to the warehouse. In turn the warehouse receives the goods back against the provided RA number providing a clear connection between the two. • No RA is available on return and the goods are received with the information available to best notate who returned the goods • Documents are stripped from the returned merchandise and it is returned based on criteria levels established by the client. • Goods are received with a sub item code to designate they are returns usually –RTV or –D if the goods are damaged. • Returns are held until sufficient stock is available to run a refurbishing line or de-kitting line to pull components for use in re-kitting. • Client receives notifications of all returns and documents are scanned for retrieval so they can credit their customer in a timely manner and watch for credits taken from their customer which are invalid or inflated.

23. O. Storage Optimization • Space utilization is one of the primary constraints of any warehouse. It is a critical that it be maintained effectively to keep costs down and operate efficiently. • Our velocity report enables us to at a glance look at the warehouse and measure the activity of our clients inventory. • Using this tool we can use put away logic to improve operational workflow and throughput. • Ensuring that the goods moving out most frequent are staged accordingly and space used in the most effective manner. • Accounts are managed between buildings as either bulk stack product or goods requiring rack locations with over 300,000 square feet of either your goods are sure to find a secure home.

24. LogistiShare - Tools • Reporting Tools • LogistiShare - online reporting system updated daily in real time providing 24/7 access via the web. • Inventory Reports • Shipping Reports • Receiving Reports • Admin Reports • Scanned Documents • Search products/inventory/customers • CSV Reports – daily, weekly, monthly, program to date • Complete Account Export – daily account activity available for export to client for import into CRM system; includes all customer & inventory activity

25. LogistiShare - Communication • Communication Protocols • Secure FTP – we can provide you with a secure FTP site for your data • HTTPs – we can pick up or drop off to your secure website • Password Zip files – we can automatically protect zip files with a password • Confirmation Emails to confirm data transmission – we confirm data transfers with order counts and file names to ensure accurate transmission and processing of data

26. LogistiShare - Dashboard Load Stats Provides a Quick Look at the Status of all unshipped purchase orders called departures. 1650 - NYKO Technologies Inc. 8 Unshipped Departures 4 Open Departures (3 Open Departures with Commits) 4 Closed Departures (4 Closed Departures with Commits) 0 Open EDI Orders Client Dashboard allows multi-program reporting for those clients who want to keep records and inventory separate by program or entity.

27. LogistiShare - Dashboard,continued Data can be accessed from quick links or folders. Data is updated in real time allowing visibility to the warehouse functions 24-7 via the web. Data can be extracted to excel at anytime for further manipulation.

28. LogistiShare - Dashboard,continued Metrics are available to track outbound and inbound activity. This allows you to monitor how the account is handled and allows us to suggest and point out ways of improving your timelines should backorders or JIT inventory cause you to fall behind.

29. LogistiShare - Dashboard,continued Nightly Reports are run and placed for clients to extract each morning or as they need. This allows for daily reconciliation of all account activity and transparent accountability. If a standard report isn’t the right fit a custom report is days away.

30. LogistiShare - Dashboard,continued Outbound orders are updated in real time and linked to online carrier tracking for Carriers that offer it. Negotiated bills of lading are scanned and provided for online viewing allowing quick resolution when a copy is requested. Freight costs if provided by MFLS are shown for easy reconciliation and accounting of usage.

31. LogistiShare - Dashboard,continued Goods received are noted at time of arrival. Arrivals are then received and notifications sent via email preferences set by clients. Documents provided by the agent who delivers the merchandise are scanned and provided for online viewing or nightly download. This allows daily reconciliation of purchases with your vendors without waiting on paperwork from the warehouse. Receipts are PO driven and can be tracked by LOT, Expiration, and FIFO when required. Date of entry is connected to merchandise throughout it’s life cycle.

32. LogistiShare - Dashboard,continued Preferences for notifications can be controlled by the client or hard coded by during setup to prevent changes by users for those members who are primary agents for data. Administrative reports are available as well as user settings allowing customized user access.

33. Contacts