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Research Report
DTSL — Delivery Technology Solutions, Inc.
July 23, 2010
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Traded: Pink Sheets Limited Price: $0.0052 bid (July 26, 2010)
Symbol: DTSL
Estimated market capitalization: $9,785,000 Outstanding shares: 1,030,000,000
(1,500,000,000 common authorized)
Company website:http://www.universaldelivery.com
52 week low: $0.0006– high $4.12
Recommendation________________________________________________________
We are recommending DTSL as a buy for speculative accounts of sophisticated investors who can understand and appreciate the risks and the potential rewards of this company.
Company Description____________________________________________________
When you want to buy using the DTSL / UDS services, you click or call a toll free number that will also be the domain name as well. One example of this is http://www.888subtogo.com/ where you can easily order from the full menu where their services are being offered.
DTSL has developed a complete software solution that enables client companies to expand nationally and internationally. DTSL's complete management solution offers call center services, online ordering and curbside pickup expertise. These solutions brand each company with its own nationwide toll-free number, online ordering with concentrated marketing and consulting services. Five key components are Software, Contact Center, Marketing, Consulting and Customer Service.
DTSL believes that it is the only qualified partner to have mastered the five essentials of the customer delivery solution: (1) One number or online ordering, (2) Call center excellence, (3) Point of sale integration, (4) Site delivery coordination, and (5) Marketing and training systems.
DTSL's solution is for chain businesses that are ready to expand their marketplace, win additional market-share and build their bottom line.
These systems are designed to be used seamlessly by the owner of the franchise, the manager of the franchise, the employees and, naturally, the customers.
After providing expert market analysis and management tools, DTSL create and support a one number ordering solution or online ordering solution.
All of this is supported with proven marketing systems and training systems that demand and promote Five-Star execution by employees.
DTSL's Delivery Solutions benefit client companies by expanding their customer vase, increasing sales revenues, raising the amount of the average purchase, and thus, improving profits.
Summary Analysis_______________________________________________________
The economics of the software business model are well known. Developing superior software takes time and money. This means corporate sacrifice. However, once the software is developed, each additional copy of the software can be manufactured at a minimal cost and this cranks out huge torrents of cash flow.
Companies that can make the sacrifice to get them in a commanding lead in the software business tend to become juggernauts as they have the cash flow to generate more and more new software products, pushing them further and further ahead in their applications and industries. Moreover, once a system is built for one industry or one use, it is less expensive to adapt it to other industries and other uses.
Moreover, new companies entering the market with new products have to prove themselves. Software involves considerable de-bugging to be reliable and years of use to develop strong systems that cover all the characteristics needed for superior customer satisfaction. Thus, a company that has a software-type business model, that has proven itself with national clients, and is about to then expand with other clients and new industries, is usually poised for enormous expansion. The first mover advantage drives it on.
We feel that DTSL is proceeding much in this manner. The company spent millions and years to develop a new customer delivery solution. The solution has been through its trial stage. The solution has been adopted by a leading national company, first with a regional trial, and recently with approved as a National Vendor. The approval of becoming a National Vendor indicates that the software is ready for more national markets.
Further applications, further national customers, and entry into further industries can now be accomplished with less time and expense. This means the prospect of rapidly growing sales and relatively large profit margins for DTSL.
Thus, it is easy to imagine that as DTSL expands its revenues and cash flows, the company has the opportunity to become one of the leading, if not the leading, customer Delivery Company in the country.
Overview_______________________________________________________________
Following six years of research and development, DTSL achieved exclusive capabilities to provide toll-free telephone and Internet ordering for companies that want to make delivery service part of their business, but do not know how. Naturally, many people use home and office delivery service in cities across America every day. However, until DTSL developed it solution, there was no single-source provider that made it possible to manage an unlimited number of deliveries and locations anywhere in the U.S.
DTSL uses a single toll-free phone number and website address. DTSL receives phone orders and online orders at a single order processing office. The order is quickly processed and charged to the customer's credit card. Just moments later, through an exclusive technology connection to the individual store or restaurant, DTSL sends orders and delivery instruction messages through the cash register terminal. The store or restaurant then prepares and makes the delivery, as instructed.
The DTSL order processing center monitors the order's progress to help speed the delivery to the customer, and ensure that it is correct. In fact, the order is tracked continuously and until the delivery is completed. Customer satisfaction surveys are conducted to ensure the best quality service.
888-SUB-TO-GO: The primary example of how DTSL serves a large chain is its 888-SUB-TO-GO service for one the largest franchise brands in the world. When a customer calls the toll-free number, or visits www.888subtogo.com, they can place an order for a home or office lunch of sandwiches, salads, sides and beverages. Customers pay DTSL a processing fee starting and depending on order size will dictate that fee.
There is also catering delivery service. Calling or clicking in advance, individuals or companies can place large orders of sandwich platters and giant 6-foot subs with all the sides for dozens, or hundreds, of people. 888-SUB-TO-GO has even served thousands of lunches in dozens of cities, all at once.
DTSL achieves 99% customer satisfaction in its surveys. Combining innovative technology with an old-fashioned dedication to service is how DTSL is changing the way companies and customers connect through delivery technology.
Industry Overview_______________________________________________________
As anyone who has traveled can attest, the United States has become a nation of chain businesses. The world seems to be following this trend. SUBWAY has 33,000 outlets in 92 countries. McDonalds, Dunkin Donuts, Starbucks, Wal-Mart, Office Depot, and hundreds of other brand name chains in every possible type of industry populate every city and town where sufficient market can be found.
These chains generally compete with blood-thirsty enthusiasm with similar chains. As the food or other products they offer are generally very much alike, they compete in other ways such as price and convenience. As we all know, offering delivery pizza has been a very successful business model, as Domino's end run around Pizza Hut proved. Thus, having a convenient system like DTSL's is very important to these chains.
Not only must the delivery system be convenient, it must be consistent. One bad customer experience can drive a consumer away forever. This is another difference that DTSL can bring to the table. With their well-developed systems and training, their customers can rest assured that their customers will stay happy and loyal.
DTSL also is ready to follow these chains into related applications like catering and into their client's foreign markets.
Highlights______________________________________________________________
DTSL’s wholly owned subsidiary UDS as previously announced has recently executed a National Vendor Agreement with Doctor's Associates, Inc. (DAI) the franchisor of SUBWAY® Restaurants, making 888-SUB-TO-GO Catering & Delivery services an option nationally.
The SUBWAY(R) restaurant chain is the world's largest submarine sandwich franchise, with nearly 33,000 locations in 92 countries.
DTSL can now search for national catering opportunities from large corporations and organizations for consideration by DAI.
This agreement shows the strength of DTSL's proprietary technology solutions in high volume order processing.
DTSL can also offer its corporate catering technology on a private brand basis to all corporate clients, including large organizations and institutions. DTSL's customers can not easily order and manage catering events at multiple venues serving thousands of meals, and prepare reports detailing every event, from their desktop or laptop.
DTSL looks to have up to 1,500 participating restaurants by the end of 2010.
Further expanding its consumer convenience, DTSL just announced a strategic alliance with GoIP Global, Inc. DTSL will use GOIG's GO800 Voice Keywords to connect consumers by Text to their call center. Consumers will be able to text such voice keywords as Pizza, Sushi, Subs, etc., place an order and have their order delivered by a local store. As part of the strategic alliance GOIG will acquire 200 million shares of DTSL common shares.
GoIP Global offers a range of services, solutions and tools for brands, agencies, content providers, online portals, entertainment and media companies. GoIP Global offers brand and content customers great flexibility in creating mobile marketing campaigns and applications. Through its subsidiary GO800, LLC, GO800(TM), a new patent-pending text messaging service which launched in 2010, enables advertisers to incorporate a text prompt in their advertisements, prompting consumers to contact them through a text message rather than calling a 1-800 toll free number.
DTSL’s wholly owned subsidiary UDS as previously mentioned has made a strategic partnership with American Express (NYSE:AXP) in a co-promotional marketing initiative for the 888-SUB-TO-GO program in the Washington D.C. market. This partnership with a major financial brand speaks well of the opportunity in the marketplace.
DTSL will be focusing on several key industries using a new in-house sales and account management staff. These include major pharmaceutical companies, national realtors, consumer electronics manufacturers and technology companies. These companies are well-known for their lunchtime buying to reward and influence their customers. Additionally, training sessions at corporate offices, and off-site hotel venues often required "ordering in" for breakfasts and lunches.
DTSL has helped several national corporations over the past year manage large scale catering events at multiple locations across the country.
DTSL will target more than 65,000 corporate event planners in the U.S., as well as marketing directors and sales managers who are usually picking up the tab. Efficiencies and economies produced by DTSL's new technology will also serve non-corporate clients, such as planners servicing religious organizations and many public and private associations who sponsor tens of thousands of events each year in multiple locations.
DTSL has already assisted in catering events for corporations, such as HP, Verizon, T-Mobile and Wells Fargo, encompassing multiple cities and time-zones for a simultaneous, coordinated, delivery of thousands of individual lunch boxes. DTSL sees tremendous potential in the corporate catering market segment.
We believe that with a proven system, accepted by national companies, DTSL is poised for significant expansion.
Financial Overview______________________________________________________
DTSL closed at $0.0095 bid in the Pink Sheets market, with a market capitalization of $9,785,000. While 1,030,000,000 shares are outstanding, the float is only 152,000,000 as of July 16, 2010. The company has a relatively large number of shareholders of record, 1,359 as of April 19, 2010.
The company has ravaged its balance sheet doing research and development, and shows minimal revenues during its trial roll out, but we feel with the recent developments, it should be prepared to make major advances in revenues and as these revenues have relatively minimal costs of goods sold, much of this should fall to the bottom line.
Excitement over the company's prospects drove the stock much higher in late 2009. The stock is now at a bargain price compared to these highs.
Other positive signs include the recent cash investment of GoIP Global, Inc.
We are recommending DTSL as a buy for speculative accounts of sophisticated investors who can understand and appreciate the risks and the potential rewards of this company.
Disclaimers_____________________________________________________________
This is a very speculative stock traded at www.pinksheets.com.
John Lux of Investing-performance.com may receive compensation for financial consulting work for the company. Such compensation may be paid in cash or stock. John Lux has not received any compensation to date. John Lux does not hold any position in the issuer being covered at the present time unless mentioned above. John Lux and or www.investing-performance.com may receive payments from the issuer’s corporate advisor for financial advice or investment banking services rendered. John Lux’s and www.investing-performance.com’s mandate here is simply to provide accurate, unbiased coverage of the issuer to its shareholders and followers.
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