1. Product
Competition
> INDIRECT (convenience)
Plastics – Visa, MasterCard, Amex, Discover, debit card , gift cards, etc
Estimated 37 million debit cards and 72 million credit cards in circulation in Canada (2010)
> DIRECT
Cash Back – Wal-Mart, Loblaw's, No Frills, etc
2. Price
• Nautilus Hyosung Monimax 7600T
• Made in Korea
• Designed & manufactured in-house
• Multifunctional machine that is designed to
support features such as dispensing cash or
envelope depository
• Product weighs in at 265lbs
• 3 separate security dimensions that can be
integrated with the financial institutions own
security or a third party security monitoring and
protection company.
3. Price & Pricing Strategy
$2400 CAD - Hardware only
$2700 CAD - Hardware and software package
(software developed by in-house software programmers and engineers)
Price quoted is CIF
Low price factors – Economies of Scale, co-location with raw material
suppliers & all manufacturing done in-house
20-22% mark up
Retail price ($3215 CAD) = Cost ($2700 CAD) + Markup (20%)
ETP Limited ATM Network including Interac and Star in Canada
4. Distribution
•D I R E C T S E L L I N G
•D I S T R I B U T O R S
•V A L U E A D D E D R E S E L L E R S ( V A R S )
8. Sale Promotion
Objectives :
> Increase awareness
> Stimulate derive demand
> Create a favorable image
> Create a favorable environment for our sales force
9. Strategies
Increase attendance at trade shows
Increase distribution catalogues
Utilize social media
Comparison advertising
10. Sales Promotion Objectives
Establish long term relationships with our clients
Stand out as primary supplier of ATMS
Emphasize superiority of products
Attract new clients
11. Sales Promotion Strategies
Secure long term contracts
Provide value added services
Create synergy
Use of demonstrations and trade shows
Focus on up-selling and cross selling
12. Price Issue & Strategy
Market Penetration Strategy
Low price – High sales volume , marginal profit
To increase market share and/or sales volume, rather
than making a profit in the short term.
Creates barriers of market entry for new competitors
$2800 CAD
13. Price
REVENUE YEAR 1 YEAR 2 YEAR 3
Gross Revenue $60,000,000 $66,000,000 $72,600,000
Cost of goods sold $48,000,000 $52,000,000 $58,080,000
Total operating $2,150,000 $2,670,000 $3,280,000
expenses
Earnings Before $11,000,000 $13,090,000 $13,405,000
Taxes
Taxes on $3,300,000 $3,927,000 $4,021,000
income 30%
Net $7,700,000 $9,163,000 $9,384,000
Income
#21459
14. Break Even Analysis
The formula for break-even analysis is
FIXED COST/UNIT SELLING PRICE-VARIABLE COST.
The fixed cost for year one is 2,150,000
The unit selling price for an ATM is $2,800
The variable cost is $80.27
For year one the break-even is
2,150,000/2,800-80.27 = 2,150,000/2,719.73 = 790.52
For year two the break-even is
The break-even is 2,670,000/2,800-90.63= 985.47
For year three the break-even is
The break-even is 3,280,000/2,800-101.20= 1,215.35