SOURCE: San West Inc.

October 21, 2009 08:00 ET

San West Inc. Management Releases Transcript of Recent Interview Conducted by Amalfi Research With CEO & Vice President

SAN DIEGO, CA--(Marketwire - October 21, 2009) - San West Inc. (OTCBB: SNWT), a Company that designs, manufacturers, sells and repairs off-road buggies, today announced the availability of the transcript of a recent interview conducted with President & CEO Frank Drechsler and Vice President Brian Britton which responded to a number of recent shareholder inquiries. Questions and answers are included below.

AMALFI -- First off, the most common question these days among investors is about the upcoming 5 for 1 forward stock split. Could you please give us your thoughts?

SAN WEST -- We'll be issuing an update in the next few days to aid current and potential shareholders in understanding how to take advantage of the forward split.

The forward stock split is intended to give shareholders increased leverage and liquidity. We are very excited about the upcoming stock split because it allows San West to share our success with our loyal shareholders. The move underscores management's confidence in the partnerships and acquisitions that we have recently executed and the future prospects of the company. We are committed to our consumers and building shareholder value every step of the way. We are also excited to have our shareholders take part in the success that the company has been having to this point.

AMALFI -- Please elaborate on San West Inc.'s vision for the future:

SAN WEST -- San West Inc. aspires to build a one-stop shop for motor-sports consumers, housing all power-sports vehicles, parts and accessories. The company intends on offering brand names including Yamaha, Kawasaki, Honda, etc., in addition to China-made off-road vehicles, and plans on becoming more diversified to include water-sports equipment such as personal watercraft, small boats, etc. Initially, San West Inc. will focus its efforts on building a model store in the San Diego area that it can begin replicating in key geographic areas either internally or via franchise opportunities.

AMALFI -- Can you please discuss the key niche market opportunity targeted by San West Inc.?

SAN WEST -- As Chinese-made off-road buggies began penetrating the U.S. Marketplace in 2002, our current vice president Brian Britton sensed a major opportunity developing and spent a year researching the potential. By 2003, Brian was responsible for two business entities: an automotive shop and an off-road shop, which sold Chinese-made buggies. He also identified some key weaknesses and began developing after-market parts capable of making them a superior, yet affordable unit.

San West Inc. is now one of very few companies in America currently serving this niche. The vast majority of dealerships that currently sell Chinese-built off-road vehicles are not qualified to service and repair them. Therefore, management views its designation as a Bureau of Auto-Repair (BAR) qualified repair location as a significant competitive advantage, particularly as demand for off-road vehicles built in China grows. In addition, the recent economic downturn has forced a substantial number of motor-sports dealerships (buggies, ATVs, UTVs, motorcycles, scooters, etc.) out of business. This trend also creates a growing opportunity for San West Inc. and has allowed us to become one of the leading off-road motor-sports dealerships in the San Diego area.

AMALFI -- How was the recently announced partnership with CountyImports.com developed and how does it benefit San West Inc.?

SAN WEST -- Management is very excited about the long-term potential of the CountyImports.com partnership as County Imports had $3.2 million in annual sales in 2008, and feels that it is an easy fit with its current business model. This will be adding significantly to San West's annual revenue base by adding additional product lines, bringing San West into the on street and ATV market that we have been lacking in. The venture also provides access to emerging product offerings including electric scooters and cars. This relationship originated years ago, when Jesse Gonzalez, the owner of County Imports approached Brian Britton with interest in re-selling his turbo-kit designed for China-made off-road buggies. As the relationship matured, Mr. Gonzalez decided to shift operations entirely online in order to spend more time with his family and began searching for a partner. San West Inc. was an ideal match for a number of reasons. Firstly, business ethics aligned perfectly and the two companies had conducted business successfully in the past. In addition, San West was able to provide seamless order fulfillment and possessed the proper dealer licenses and customer support capabilities necessary to run a burgeoning online action sports business.

AMALFI -- Please Comment on the distribution agreement with TrophyKart and what it brings to San West:

SAN WEST -- The exclusive San Diego area distribution rights for TrophyKart racing trucks benefits San West Inc. in a variety of ways and significantly broadens the company's horizons. In addition to generating an additional $150,000 to $250,000 in annual sales, this agreement brings national television publicity to the Buggy World brand and brings Buggy World one step closer to its ultimate goal of becoming a one-stop shop for motor-sports enthusiasts. It also provides an opportunity for San West to provide parts and repair services to a drastically under-served marketplace and capture significant sales by doing so.

TrophyKart provides entry-level off-road vehicles and racing opportunities for America's children. Association with the brand helps San West and Buggy World expand their target market and gain notoriety with the younger demographic. It also allows the company to ensure future growth and help build the sport of off-road racing by ensuring the next generation of participants.

AMALFI -- How does your partnership with San Diego SportCycles fit into your business model and add value to San West?

SAN WEST -- The partnership with San Diego SportCycles is valuable to San West because it also brings us closer to becoming a one-stop shop for consumers. Having the apparel, accessories, and motorcycle gear for the quad, dirt bike and street bike industries is a very important part of our future. This deal is expected to add at least $700,000 to our top-line revenues over the near-term and potentially much more over the next 2 to 5 years because it brings a much more diverse selection of products and brands to Buggy World and its customers.

AMALFI -- What are the key strengths of your company and what factors set you apart from the competition?

SAN WEST -- Our key strengths definitely lie in our unique service and repair capabilities. We have this niche in the market. There are very few people throughout the US that even work on China-made off-road vehicles. We have all of the parts sources for just about everything brought in from the China and imported market. We also benefit from a wide variety of wholesale connections for parts that many of our competitors are not privy to. Yet another strength of our business is that we offer parts and accessories that drastically improve the performance of foreign off-road vehicles while keeping them cheaper than name brand models. Our internal R&D is also very beneficial. We develop our own individual high-performance parts. This helps build our online presence nationwide and online sales continue to account for a growing portion of our business.

An additional strength is Brian's experience in the industry and involvement since its inception (6 years). He has grown along with the opportunity, has the ability to develop after-market parts and benefits from a deep understanding of where the limitations of vehicles were, where they are today, and exactly what needs to be improved upon and specifically how to improve it. We could not ask for a better member of our management team based on that factor alone. He's been involved with these vehicles basically since the day they began coming to this country.

AMALFI -- What are you doing to offset the economic recession and ensure that consumers can purchase your products?

SAN WEST -- Brian has been opening up doors left and right. We opened up a promotional credit card program called RPM card. That card gives consumer 90 days, 6 months, 12 months, same as cash for everything but titled loans. We have put our best foot forward during the recession to create opportunities that help increase sales to consumers that don't have great credit. We are working with State Farm Bank and ThinkMutual Bank. We can currently finance consumers that have filed for bankruptcy and those with FICO scores as low as 450 for as much as $10,000. The average FICO score for consumers in Southern California is about 575, so we have the resources, through these financial institutions, to get a wide range of consumers into our vehicles and ensure our success.

AMALFI -- How are your sales projections looking over the next few months?

SAN WEST -- Our busy season historically ramps up in late September. In addition, we expect our holiday season and our fourth quarter to be, by far, the best in company history.

AMALFI -- What involvement does the management team of Human BioSystems have in your current operations and are they responsible for liquidating any of their past liabilities?

SAN WEST -- The only involvement that the prior management team has now is ensuring that their patents and processes will be spun out of company. Debt will be reduced through these efforts which will leave approximately $600,000 on our books. This is in accordance to the terms of our merger agreement, which dictates previous management help retire a percentage of their historical debt.

AMALFI -- Can you comment at all on any new developments with regard to new products or services being offered?

SAN WEST -- We keep a real good eye on the market and after 30 year of experience, Brian has a very firm grip on inventory management. The two main areas for improvement on any off-road vehicle are suspension and power, and that is where we place our key focus with regard to parts inventory. In addition, we can get anything not in stock in 24 hours.

AMALFI -- Are you in a position to comment on any major developments that have transpired recently with regard to new partnerships, sales/marketing agreements, etc.?

SAN WEST -- We have a number of exciting things going on at San West that we are preparing to announce to the public over the coming weeks and months. Some of these include a new joint venture that will increase sales as well as our position in a key off-road market, a strong radio advertising campaign that will be launched shortly, product give-a-ways at major public events, and other market efforts that will position us in front of hundreds of thousands of consumers. The next few months will certainly be exciting times.

AMALFI -- Please elaborate on the history of your company:

SAN WEST -- San West Inc. was founded by Frank Drechsler as a privately held online niche marketing company focused on identifying and selling products that are not readily available in the open public marketplace. In August of 2007, Frank was introduced to Bryan Britton and became intrigued by his business focus on the market opportunity associated with providing upgrades for Chinese-made off-road buggies including turbo-kits, suspension enhancements and various other products.

Frank's position as an outdoor and off-road racing enthusiast made San West Inc. and Mr. Britton's business a natural fit and the two began attending tradeshows together and co-marketing the new offering. As the partnership matured, a race circuit for off-road buggies emerged in Southern California.

Brian Britton began attending events and applying his decades of experience and extensive automotive service/repair certification to upgrade participating vehicles. During this time, Brian was introduced to Jim Jordan, the owner of Buggy World, a leading brick & mortar off-road motor sports company in the San Diego area and a well-known company on the circuit. Finally, in August of 2008, San West Inc. acquired Buggy World and merged the business into its existing Letz Go Racing Off-Road Center. This combined the retail sales of off-road buggies, after-market upgrades and repairs.

About San West Inc.:

San West designs, manufacturers, sells and repairs off-road buggies, and additionally provides aftermarket performance products and accessories for off-road buggies. Products are sold via three divisions: at retail store locations, via the online store and through its growing dealer network. Buggy repair services are sold and fulfilled at the Santee, California retail location.

For further information about San West Inc. visit www.countyimports.com, www.BuggyWorld.net and www.SanWestInc.com.

Certain statements contained herein are "forward-looking" statements (as defined -- Private Securities Litigation Reform Act of 1995). SNWT cautions that the statements made in this press release constitute forward-looking statements and no guarantees of future performance and actual results or developments may differ materially from projections in forward-looking statements. Forward-looking statements are based on estimates and opinions of management at time the statements are made.

Contact Information

  • Contact:
    San West Inc.
    Corporate Communication
    (858) 246-6822