Capstone Industry Conditions Report For C68711

Your instructor can customize the simulation scenario. The information below is specific to your industry.

Printable and Downloadable PDF Version of This Report

The sensors your company manufactures are incorporated into the products your customers sell.
Your customers fall into five groups which are called market segments. A market segment is a group
of customers who have similar needs. The segments are named for the customer's primary
requirements and are called:

Drift Rates
Each year, the segments drift the length of the hypotenuse of the triangle formed by customers'
desire for smaller and faster products.
Table 1 Segment Circle Drift Rates: Every year, customers
demand increased performance (Pfmn) and decreased size.
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Capstone Industry Conditions Report For C68711

demand increased performance (Pfmn) and decreased size.

Note that the drift rates vary for each segment.
Pfmn Size
Traditional +0.7 -0.7
Low End +0.5 -0.5
High End +0.9 -0.9
Performance +1.0 -0.7
Size
+0.7 -1.0

Segment Centers
Table 2 Segment Centers at the End of Each Round: As shown in the Perceptual
Map Form above, size is on the vertical axis and performance (Pfmn) is on the
horizontal axis.
Traditional Low End High End Performance Size
Round Pfmn Size Pfmn Size Pfmn Size Pfmn Size Pfmn Size
0
5.0
15.0 2.5 17.5 7.5 12.5 8.0
17.0 3.0 12.0
1
5.7
14.3 3.0 17.0 8.4 11.6 9.0
16.3 3.7 11.0
2
6.4
13.6 3.5 16.5 9.3 10.7 10.0 15.6 4.4 10.0
3
7.1
12.9 4.0 16.0 10.2 9.8 11.0 14.9 5.1 9.0
4
7.8
12.2 4.5 15.5 11.1 8.9 12.0 14.2 5.8 8.0
5
8.5
11.5 5.0 15.0 12.0 8.0 13.0 13.5 6.5 7.0
6
9.2
10.8 5.5 14.5 12.9 7.1 14.0 12.8 7.2 6.0
7
9.9
10.1 6.0 14.0 13.8 6.2 15.0 12.1 7.9 5.0
8
10.6 9.4 6.5 13.5 14.7 5.3 16.0 11.4 8.6 4.0
The information in Table 2 reflects the segment centers at the end of the round. Therefore, the
Round 0 positions can be seen as the Round 1 starting positions, Round 2 positions can be seen as
the Round 3 starting position, etc. Each month during the simulation year, the segment drifts 1/12th
of the distance from the starting position to the ending position.
Ideal Spots
Table 3 Ideal Spot Offsets:
Customers prefer products
located this distance from
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Capstone Industry Conditions Report For C68711

the center of the segment circle.

Pfmn Size
Traditional 0.0 0.0
Low End -0.8 +0.8
High End +1.4 -1.4
Performance +1.4 -1.0
Size
+1.0 -1.4
The information in Table 3 shows the Ideal Spot "offsets" or distances from the segment center. The
ideal spot is that point where, all other things being equal, demand is highest. It is different from the
segment center. Why are some ideal spots ahead of the segment centers? The segments are moving.
From a customers perspective, if they buy a product at the ideal spot, it will still be a cutting edge
product when it wears out.

2 Segment Sizes and Growth Rates

At the beginning of the simulation, Traditional and Low End sell more units than the high
technology segments, High End, Performance and Size. Page 10 of the Capstone Courier, the
Market Segment Report, displays total industry sales.
Each market segment grows at a different rate. Table 4 lists the beginning segment growth rates for
your industry. The growth rates might change from year to year. Check the Segment Analysis
reports in the Capstone Courier each round for the upcoming year's growth rates.
Table 4 Beginning Segment Growth Rates
Traditional 9.2%
Low End 11.7%
High End 16.2%
Performance 19.8%
Size
18.3%

3 Buying Criteria By Segment

These are your products and the primary segments they sell into at the beginning of the simulation.
These can change according to your decisions and as the simulation evolves.
Able Traditional
Acre Low End
Adam High End
Aft Performance
Agape Size

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Capstone Industry Conditions Report For C68711

The buying criteria for each segment, in order of importance, are displayed below. Positioning and
Age score information also display. Passing your cursor over an image will enlarge it. See Chapter 3
of the Team Member Guide for explanations of Positioning, Age, Price and MTBF scores.
3.1 Traditional Segment Buying Criteria (Round 0)
Traditional customers seek proven products at a modest price.
Age, 2 years importance: 47%
Price, $20.00-$30.00 importance: 23%
Ideal Position, performance 5.0 size 15.0 importance: 21%
MTBF, 14,000-19,000 importance: 9%
Industry Conditions Figure 3.1: Traditional Buying Criteria

Traditional customers give higher position scores to sensors located in the center of the
segment circle.

Traditional customers give higher scores to sensors in the 2 year range.

3.2 Low End Segment Buying Criteria (Round 0)
Low End customers seek low prices and well proven products.
Price, $15.00-$25.00 importance: 53%
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Capstone Industry Conditions Report For C68711

Age, 7 years importance: 24%

Ideal Position, performance 1.7 size 18.3 importance: 16%
MTBF, 12,000-17,000 importance: 7%
Industry Conditions Figure 3.2 Low End Buying Criteria

Low End customers prefer inexpensive sensors with slower performance and larger size.

Low End customers give higher scores to sensors in the 7 year range.
3.3 High End Segment Buying Criteria (Round 0)
High End customers seek cutting-edge technology in size/performance and new designs.
Ideal Position, performance 8.9 size 11.1 importance: 43%
Age, 0 years importance: 29%
MTBF, 20,000-25,000 importance: 19%
Price, $30.00-$40.00 importance: 9%
Industry Conditions Figure 3.3 High End Buying Criteria

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Capstone Industry Conditions Report For C68711

High End customers demand cutting edge sensors with high performance and small size.

High End customers give higher scores to newer sensors.

3.4 Performance Segment Buying Criteria (Round 0)
Performance customers seek high reliability and cutting edge performance technology.
MTBF, 22,000-27,000 importance: 43%
Ideal Position, performance 9.4 size 16.0 importance: 29%
Price, $25.00-$35.00 importance: 19%
Age, 1 year importance: 9%
Industry Conditions Figure 3.4 Performance Buying Criteria

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Capstone Industry Conditions Report For C68711

Performance customers emphasize performance over size.

Performance customers want sensors in the 1 year range.

3.5 Size Segment Buying Criteria (Round 0)
Size customers seek cutting edge size technology and younger designs.
Ideal Position, performance 4.0 size 10.6 importance: 43%
Age, 1.5 years importance: 29%
MTBF, 16,000-21,000 importance: 19%
Price, $25.00-$35.00 importance: 9%
Industry Conditions Figure 3.5 Size Buying Criteria

Size customers emphasize size over performance.

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Capstone Industry Conditions Report For C68711

Size customers prefer sensors in the 1.5 year range.

4 Projected Interest Rates

Prime Interest Rate Round 1: 7.0%

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