Biz_Plan

The Innovators Business Plan (Team 3) ‘Grab and Go’ Wireless 3G/WiMAX Communications Suite AMBA 600, Section 1141 Professor Merin November 22, 2009 Table of Contents I. Product Description II. Product Justification III. Operating Industry IV. Potential Customers / Market Size V. Product Competition / Substitutes VI. Global Market Strategy VII. Pricing VIII. Profit Explanation IX. Financial Reports X. References ‘Grab and Go’ Wireless 3G/WiMAX Communication Suite I. General Product Description The ‘Grab and Go’ 3G/WiMAX Communication Suite allows multiple users to simultaneously access and share a single commercial cellular connection, giving employees instant access the internet remotely, anywhere and anytime. This compact suite is fully contained within a ruggedized Pelican case, weighs less than 15 lbs, and ready for immediate transport and operation. The unit can be operated on 120-240VAC, 12VDC or rechargeable battery power lasting up to 12 hours. The suite consists of a wireless router, a PCMCIA cellular modem card adaptor, cellular antenna, and an integrated 12V UPS with battery backup. The suite can be operated in both external and internal modes, using a wireless 3G or WiMAX cellular connection. The suite is also equipped to handle any standard ADSL or cable connection. It can be configured for secure communications through the application of allied or US-only cryptographic controlled items (CCI) for both government or military applications. [pic] Figure 1. Grab and Go Wireless 3G/WiMAX Communication Suite Concept, Source: img.directindstry.com, fieldworks.nl, bigcellshop.com, computerrepairmaintenance.com, proscantechnologies.com, drct.com This communication suite meets standard military specifications (MILSPEC), made to withstand the most rigorous conditions and temperatures. The Pelican case serves two primary functions: transport and operation. The suite is ready for immediate transport 24/7, fully contained without the need of having to pack any components. It can be easily carried with regular luggage, in addition to being checked during travel without any special handling considerations. [pic] Figure 2. Pelican case concept model. Source: publicpirate.com, blogs.communication.utexas.edu, coolgadgets.com The suite can be operated in two modes: external and internal. Operation in external mode implies the case does not need to be opened for the unit to function. A manual cipher lock secures both the case and the external power switch, required to enable the device. An external AC input with cable provides the ability to power the device in this mode. LED indicator lights notify the operator the device is functioning properly. An external cellular antenna can be mounted anywhere to maximize cellular coverage in your area in this mode, but is not required. [pic] Figure 3. External Operation Mode. Source: markjnewattorneyatlaw.com, publicpirate.com, compassionatememorials.com, The internal operating mode is intended for static, indoor locations where infrastructure is available. The suite can be easily configured for ADSL/cable operation where an existing internet connection exists. This allows for more inter-office wireless coverage and flexibility. A built in switch on the front of the router enables and disables the 3G/WiMAX and ADSL/cable connections. The router and PCMCIA adaptor mounted in custom foam can be easily removed when replacement spares or substitutes are required. The UPS with integrated re-chargeable battery are securely fastened to case chassis. The power supply can be removed with standard Phillips screwdriver. [pic] Figure 4. Internal Operation Mode. Source: bessemerincubator.com, 209.216.8.37/crm Dedicated cellular data plans are fully customizable for PCMCIA cellular cards through all major carriers to maximize resources and minimize associated data bandwidth costs. Current active US carriers include Verizon, Sprint, Alltel, AT&T, and T-Mobile. The activated cellular PCMCIA card is inserted in a PCMCIA to USB adaptor, connecting to the router enabling 3G or WiMAX access. The suite currently supports all existing 3G bands to include GSM and CDMA. 3G wireless cellular card’s can operate at speeds of anywhere from 20-1200kbps, depending on the PCMCIA card type and cellular data plan. A unique feature of this suite’s modem is the ability to operate at today’s highest wireless speed, commonly referred to as WiMAX technology. WiMAX selects and uses cellular and microwave transmission bands simultaneously to transmit and receive data multiplying the data rate to increase bandwidth. The success in compatibility of this product is the development of current 3G PCMCIA cellular modem cards modification to support WiMAX transmissions, essentially what will be known as a WiMAX PCMCIA card. These cards can operate at speeds of up to 10 Mbps, consummate to that of today’s broadband connections. [pic] Figure 5. WiMAX Advantage. Source: upload.wikimedia.org The suites router has multiple security enhancements to include WPE/WPA encryption, built-in firewall and VPN capable. The WPE/WPA wireless router encryption ensures the wireless transmissions from the suites router to computer are secure. The built-in firewall protects individual users against network intrusion and internet attacks. The Virtual Private Network (VPN) security and client software ensures secure tunneling through the connection back to your company’s domain. This unique feature allows you to access your resources securely as if you were sitting at your own desk, including outlook exchange services, database accesses, and share drives. [pic] Figure 6. Security Advantage. Source: ironsoftware.de, docs.hp.com ‘Grab and Go’ Wireless 3G/WiMAX Communication Suite ‘Grab and Go’ Wireless 3G/WiMAX Communication Suite II. Product Justification To meet the growing demands of both civilian and military applications, the Innovators have developed the ‘Grab and Go’ Wireless 3G/WiMAX Communications Suite. The requirement for expeditionary lines of communication has never been greater than now. According to a survey conducted by the Innovators, over 99% of participants use the internet when they travel for business (A. McNeill, personal communication, November 18, 2009). The interviewed participants were both of mixed civilian and military backgrounds, creating a diverse pool generating applicable data. The survey results overwhelmingly concluded that the ‘Grab and Go’ Wireless 3G/WiMAX communications suite would be a great fit for both military and civilian applications. The roll-up of the survey data shows the suite would fit well in any military application requiring deployed communications in cellular or WiMAX enabled locations. Many interviewed who felt this would best be marketed toward military applications also believe this would fit well into federal, state, and/or local government emergency management services and marine costal operations where network infrastructure is limited. Several participants also noted civilian applications for this technology suite to include off-site government contractor sites, construction sites, and the ability to work in mass transit. Many companies carpool in 10 or 15 passenger vans to and from business sites or meetings, which may take anywhere from half a day to a full day of travel time. This suite would enable one connection for everyone within a carpool to use; one wireless mobile hotspot as opposed to multiple wireless 3G cards and cellular plans. Michael Chertoff (2008), the Secretary of Homeland Security, published the National Emergency Communications Plan in an attempt to bridge existing communications gaps during federal, state and local emergency response activities. This document highlights many requirements for rapidly deployable communications packages such as the ‘Grab and Go’ wireless 3G/WiMAX communications suite. One of Chertoff’s major objectives within the plan addresses disaster communications planning and capabilities (p. 34-38). One of the key points within this objective highlights the requirement for emergency responders to have a communications continuity plan, to include backup and/or mobile deployable communications solutions (p. 34). Service providers dedicate bandwidth (satellite and cellular) to emergency response organizations to ensure connectivity through the most demanding of circumstances. Cellular over IP technology is an emerging field. There are numerous applications in today’s market who’s very existence justify the need for the ‘Grab and Go’ Wireless 3G/WiMAX Communications Suite. One such product is called the Tactical GSM Cellular Base Station Router (“BSR,” 2009). This tactical cellular router is intended to be in a fixed mounted location rather than ‘Grab and Go’, but essentially can do several of the same things the 3G/WiMAX communications suite can. In addition, the United States Joint Forces Command (USJFCOM) is currently assessing the feasibility to bring this cellular model of tactical communications to the force (Thompson and Touche, 2009). Navy Commander Thomas Thompson and Marie La Touche, the Joint Fires Integration and Interoperability Team lead believe cellular technology will enhance the situational awareness of both conventional and non-conventional special operating forces (SOF) (p.1). ‘Grab and Go’ Wireless 3G/WiMAX Communication Suite III. Operating Industry The industries in which the communications suite would operate are Federal, and state governments, all areas of public safety, and the construction industry. Below is a task organization chart of how our company will operate day to day: [pic] ‘Grab and Go’ Wireless 3G/WiMAX Communication Suite IV. Potential Customers / Market Size In today’s digital age, cyber security is of vast importance, not only for personal security, but also national security and the protection of intellectual property. Our major potential customer is the Department of Defense (DoD), with a fiscal spending budget of $628 billion for fiscal year 2010. ‘Grab and Go’ wireless is looking to gain a foot hold in mobile communications for the government. A major customer within the DoD is the US Armed Forces; their increased need for reliable and compatible mobile communication is a priority for today’s warfighter. Another strong candidate for the ‘Grab and Go’ wireless suite is the state government’s public safety arena (Law enforcement and Fire Department). During the Sept 11, 2001 attacks the state and local public safety departments had issues with Interoperable Communications between the different groups. The ‘Grab and Go’ wireless suite will allow various groups within state and local governments to communication through a dedicated, mobile system. The Federal Emergency Management Agency (FEMA) saw the same difficulties during hurricane Katrina. The Department of Homeland Security (DHS) maritime patrol force is a customer who would have the ability to patrol our coastline and have a dedicated secure line for their interdiction operations. DHS custom and border patrol would have a reliable mobile communication network to help their Secure Border Initiative (SBI). In a time of national or global crisis the Grab and Go wireless suite would allow all of these groups within the DoD to communicate and share data seamlessly. The estimated market size of the federal government is in the upwards of $4 million. On the commercial side, any major construction firm would love to have the ability of secure mobile communication and the network access to download and view intellectual property while still at the construction site. The estimated market size is upwards $7.7 million. ‘Grab and Go’ Wireless 3G/WiMAX Communication Suite V. Product Competition / Substitutes In our technologically advanced society there is always constant growth to help provide the top-notch, most exclusive, value-added services to consumers and businesses of various status and size. The evolution of the Internet and wireless cellular products and services is driving business and economic changes throughout the world. As quickly as a new innovation is created and implemented, there is something else that comes and attempts to compete in this booming business. Individuals in today’s society are more business-oriented than ever before. In times of ambiguity all companies and employees must be resilient and adaptable. With this being said, our proposed business plan for the ‘Grab and Go’ 3G/WiMAX Wireless Communications Suite will suit any business anywhere at any time. With the implementation of any new product and/or service we will have to conduct an all-encompassing assessment of our current and potential competitors as well as how the product will fit in the global market. Once that assessment is thoroughly conducted, we can make our niche. There are hundreds of wireless communication companies that provide a variety of services. Our niche is the ability to grant employees/companies remote internet access to a single, wireless 3G/WiMAX commercial cellular connection, anywhere and anytime. Some of our competitors include Verizon Wireless, which is the number 1 wireless server in the world, Vehicular ad-hoc network, and wireless local area network. Verizon Wireless has introduced an innovative product known as the Verizon Wireless Internet Card. With this card the end-users are able to simply place the card into any laptop computer, inserting in the same spot that the USB port goes, and instantaneously can connect to a wireless router. However, in order to have access you must sign a two-year contract. Most employers take on the responsibility of the monthly fees and allows their employees access. The price range for this product varies from $19.99-$59.99 for mobile Internet which includes approximately 5GB of data usage. Although the wireless chip is very compact, with little set-up time; it is often times unreliable. I have attempted to use my wireless chip on several occasions, however, when it cannot connect to a wireless network there are limited options for access. This can pose issues for any businesses, mainly those with mobile workforces. A researcher Sascha Segan (2008) states, “We may be headed for a world where you get two choices for phone and Internet access: Verizon being the primary choice (p.1). Another current competitor is known as the Vehicular ad-hoc, also known as VANET. This network system is designed to allow Internet access between vehicles within certain limitations. An innovation like this will primarily be utilized in certain industries; for example, industries that require an abundance of delivery, etc. The Wireless local-area networking has been around quite some time. Many companies use this network to access the internet but in today’s business market, where there is lots of travel to different locations there needs to be a product that can withstand different environments, with no hassle and at all costs. An emerging competitor is the WASP (Wireless Application Service Provider). “WASPS are an important part of the emerging wireless internet world; connecting users of mobile devices such as PDA’s and phones to the internet…also providing applications” (p.1). This is a possible competitor because it comes with the applications already built in that an employee may need in order to help with establishing business processes, completing tasks, technical support, consultative services, etc. Some of the services that are provided with this highly anticipated product are schedule functions for mobile workforces, location-based services and broader email-based functions (“WASP”, 2003). ‘Grab and Go’ Wireless 3G/WiMAX Communication Suite VI. Global Market Strategy As the wireless industry continues to flourish in the wireless and Internet convergence we must consider how this particular product will fit in global markets. Many companies have clients and have to build and maintain relationships in order to be successful; sometimes also lead to a merger between companies. There are major companies is China, Sweden and Beijing that are movers and shakers in the wireless Internet industry. One company is Trapeze Network; the first global company to introduce Nonstop Wireless Networking that delivers unparalleled reliability to the enterprise wireless LAN, with the best possible solutions that allows companies to be mobile with high access (“Beijing Science”, 2009). The service provides users the ability to utilize it both indoors and outdoors. Wireless data applications on the consumer and business markets are never-ending. Although there are many products to choose we must consider the strengths, weaknesses, opportunities and threats. One of our key strengths that we would have in the global market is our ability to provide access for businesses in remote areas. This will work exceptionally well in industries like The Army where personnel may subsequently be deployed in areas where Internet service is never accessed. Another key strength is that we are providing a total package with reliable connectivity. One factor that we would have to consider in the global market is the ability to consult and provide broad-based support when there are problems during times of ambiguity. One major competitor that we’d have to look out for in the global market is a company by the name of Syniverse Technologies. In the article Syniverse Provides Array of Services to 100 Operators in Asia Pacific it states, “Syniverse provides mobile technology for the global wireless communications industry, making it possible for disparate data, messaging and voice technologies to interoperate anywhere, any time. Serving more than 800 communications companies in over 160 countries, Syniverse offers market-leading solutions that simplify the complexities of roaming, messaging, network interoperability and business intelligence for mobile operators, MSOs, enterprise verticals and emerging mobile providers” (Anonymous, 2009). It is safe to safe that foreign markets have become major player in the wireless market. Many products and services are outsourced from countries such as China and India. Often times these markets are the innovators that create such frenzy in this very dynamic industry. A product/service like The Innovators’ invention can be very influential in the markets for wireless service and allow countries like China to be the first to have it implemented and marketed to a few of their major corporations. Once we make our niche in their market, we can consider merging with a local, huge franchise in order to help gain market share. With the way the business world has evolved, businesses are constantly searching for ways they can increase their efficiency, as they move to a more mobile workforce, while staying up to date on new and recurring tasks. The ‘Grab and Go’ 3/4G wireless device can make wave anywhere at any time. ‘Grab and Go’ Wireless 3G/WiMAX Communication Suite VII. Pricing The Innovators used a random survey sample of forty participants to help determine the price of the suite among other things. Both military and civilian participants were surveyed to provide a better representation of the target market. The following questions were asked to help determine the product’s feasibility, target market, and pricing: • Do you access the internet when you travel for business' • In one year, how many times do you travel for business to remote areas with limited/no access to the internet' • On average, how much do you pay for wireless internet access in one week of business travel' • How much would your company pay for the communications suite, excluding the cellular data costs' • In what ways would this package contribute to the productivity of your employees' • What form of remote communication does your company currently utilize' • What kind of on the go, up to the minute, accurate information would benefit from the application and implementation of the Grab and Go 3/4G Wireless system' A consolidated analysis chart (Figure 1) below shows both the measures of central tendency and variability of the consolidated survey results. Figure 1 (Consolidated Questionnaire Analysis) [pic] The survey sample recommended a median price point of $150 per unit, with a first inter-quartile range being $100 per unit and third inter-quartile range of $250 per unit. After breaking down the financials in Section 9 including detailed expenses and start-up costs, the only way to remain profitable within the first 12 months was to establish a price per unit above $150, but still within the third quartile of $250. The Innovators have determined the price point per unit of $250 is both financially and marketability feasible. ‘Grab and Go’ Wireless 3G/WiMAX Communication Suite VIII. Profit Explanation I. Explanation of the proposed business model. The Grab and Go is a 3G/WiMAX Wireless Communication Suite that allows multiple users to simultaneously access and share a single wireless 3G/WiMAX commercial cellular connection giving you remote access to the internet anywhere, anytime. Ideal for off-site meetings, conferences, and business trips where you want full accessibility into your corporation’s domain just as if you were sitting at your own office desk. This communication suite is designed to increase business productivity by optimizing real-time hours and adding to business efficiency. In a survey conducted in November 2009 among several business owners, it was revealed that such a communication would reduce costs, open new venues of information sharing among employees and provide instant, up to the minute feedback on the status of business revenues. II. How will we make a profit' The product will make profits from sales, inventory and operational expenses. Our price will be determined based on three basic production costs: direct materials, labor, and overhead. After these costs are determined, the final price will result in the product bringing in profit while sustaining its competitive advantage. The inventory will consist of money that will be invested in the purchase of materials needed to manufacture the communication suite, also known as cost of goods sold. Our operational expense will be the money we spend to turn our inventory into sales according to Goldratt and Cox (1986). III. How will the product be produced or marketed' The Small Business Administration website offers valuable information on business startups, marketing, and pricing (http://www.sba.gov/smallbusinessplanner/manage/marketandprice). With the surveys we recently conducted, we were able to generate a customer profile that helped us in determining who our competitors are and how much of the market we can actually assume. As a result, the 3G/WiMAX will be marketed to mid-size and large companies with high volumes of internet usage among Senior Executives, Mid-Level Managers and other company employees who rely on such communications while on business travel outside of the office. IV. Will we manufacture the product or outsource to another company' The product will be manufactured by our North Syracuse, NY manufacturing company. V. Where will we produce the product' For liquidity purposes, we will be leasing property that will be used to both manufacture and warehouse the products until the point of sale is made. VI. Will the product be sold directly to consumers or have a retail firm sell it for us' We will sell directly to consumers to save costs of having a ‘middleman’ to pay expenses to. It is the goal also for the company to expand to the global environment thus enabling us to branch out and take advantage of the cash flow from the international markets. ‘Grab and Go’ Wireless 3G/WiMAX Communication Suite IX. Financial Reports The Innovators financial plan to manufacture, market and sell the ‘Grab and Go’ 3G/WiMAX Communication Suite contains a 12-month profit/loss forecast, estimated balance sheet, and a break-even calculation. This financial forecast provides an accurate representation at how our company will profit over the next 12 months. The Innovators have set the initial product sale price point at $250 dollars a unit based on extensive market and customer survey research. This 12-month profit/loss forecast depicts a net profit of $17,720 at the end of fiscal year 2010. This detailed snapshot of company operations estimates the total revenue (sales) month-by-month, taking into account the costs of sales and expenses to include labor, materials, packing, shipping, and insurance costs. Figure 1: 12-month profit and loss forecast [pic] The second figure depicts our opening day financials to include current and fixed assets, liabilities, and net worth. Figure 2: Opening day balance sheet [pic] The third figure projects our profit of $17,720 over the first 12-months of operation. Figure 3: Projected balance sheet [pic] Figure 4: Break-even analysis [pic] References Anonymous. (2009). 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