III.

Industry Analysis

Industry Overview: Stress sensor has been used in an adequate application nowadays
in almost industries. From sport which measure pressure in a shoe of athletes with
medical industry is used for hip replacement surgery. Also, it is used in many domains in
car manufacture, which uses to produce brake pads, gaskets and tires. In medical,
stress sensor also uses for cartilage mechanics, podiatry, prosthetics and clinical tumor.
In industry, the technology can be used in composite material, molding, roller systems,
robotics. The contact pressure sensor has a widely range of applications in many
industries.

Supply and Distribution: SensTech is an ultra-thin sensor which includes very tiny
electronic parts. The cheapest way is to get parts from China, but the delivery time will
be long. However, sensor parts are very light weight will cost around $12.50 for 8lbs
which will make the price of part more than 50% cheaper if we buy the parts in the US.
We also can get parts from some electronics suppliers such as Texas Instruments or
Mouser which are given higher prices.

Technological Factors: SensTech sensor itself is very tiny with thickness around
0.004 and size 1.75mmx1.75mm. The fact is that if we want to load distributions
between sensors to make a mask of the sensor. The connections between sensors are
extremely important. It will cause loss of signals or break apart. The sensor itself is
super strong since made by silicon material cover outside, but the size and thin
sometimes will have both advantages and disadvantages.

Economic Influences: The sensor itself is not luxury goods, but when it uses in
applying it can consider as a luxury goods. For example, people will more care about
doing exercise and technology, if we attack the sensor under the running shoes to track
the real-time foot heat map, then the needed product will go up when the economy go
up. And the sensor uses mainly in manufacture industries. It might affect of the
economy when the manufacture produces less products, the need of sensor which help
to improve quality when manufacturing is also less.

Entry Barriers: There is only difficult thing when entering the business is intellectual
property since plenty of companies already owned the technology. How to make our
technology different from the others is very important. The sensor also requires a safety
qualification called NFPA 70E.

Regulatory Issues: As mentioned above, the sensor itself has to qualify the safety rule
called NFPA 70E. Also, when we use the SensTech sensor in other applications, we
also need to qualify other rules. For example, if we use the sensor in hip replacement,
we have to qualify the FDA administration who is responsible for regulating firms who
manufacture, repackage, relabel, and/or import medical devices sold in the United
States. And in shoes manufacture, we have to guarantee that our sensor is qualified
safety standard.
IV. Market Analysis

Definition of Overall Market: The stress sensor has a very large market in widely field
of applications especially in the manufacture. In shoe companies, we can have
embedded sensor under shoes for tracking activities and injury prevention. In medical
device companies, we use a sensor to monitor hip replacement to prevent baneful
influence after surgery. In tire manufacturers, sensor will help to track real-time pressure
adjustment. In industrial and automotive, we can do gasket/seal stress sensing, etc.

Market Size and Growth: If considering all markets, we have a very huge number of
market size. But we will focus on the shoe companies which is our target segment first
to see how big market is and how the technology is possible. Based on the report of
statistics portal, the number of joggers/runners amounted to 60.84 million in 2015 in the
United State. Base on our interview, 10% of runner will consider to buy a shoe with that
technology if the shoes price around 300-400$. The sensor costs 100$ which means
the market size in runner is 608.4 million $. In addition, the number of people who
played golf amounted to 26.02 million in 2015 in the US, and 15% of them consider to
buy the shoes with the technology which market size is 390.3 million $. By only
considering the runner and golfer in the US, the market size is nearly 1 billion $. The
growing market is also based on the report of number of runner and golfer which is
unstable, but growing 2-5% each year.

Market Trends: The trends in recent year are smart devices and human tracking
activities. In 2015, we saw the rise of smart device is almost absolute. IoT (Internet of
Things) is almost everywhere, not only limit on smart phone. We have smart watches,
smart light, smart AC controller, smart home, etc. We also saw Fitbit or wearable device
tracking human activity trends. That is why our focus on making a smart shoes.

Market Segments: We focus on two market segments are shoes manufacture and
medical industry. On shoes manufacture, we focus on making a shoes for athletes. In
medical industry, we focus on using SensTech sensor in hip replacement.

Targeted Segments: Our targeted customers are runner, golfer and basketball player
whose really care about the balancing when they wear a shoes and would like to track
the foot heat map to improve the performance and prevent the injury.

Customer Characteristics & Needs: We also device our customer to two segments.
One is professional player and the other is amateur player. The professional players
dont believe that the shoes can help them to improve the performance since they have
to train and practice a lot to become professional but they really care about preventing
injuries since nobody care but them. Charles Mathenge (a runner at OSU team) said:
Most athletes get injuries due to lack of knowing how much mileage they put on their
show. On the other hand, the amateur players are really care about performance, they
want to play like a pro, without fee of coaching, the shoes can become their coach. We
also mentioned the feature which we can compare the posture, data with the
professional player and feedback from community.
Purchasing Decision Process: From now on, we decide to sell our sensor to shoes
companies Nike and New Balance, which make us free of designing and making a
shoes. Whoever want to have a shoes can assist when you play which make you play
better or who want to track the foot heat map and know how many mileages on running
to know when have to replace a new shoe to prevent injury will consider to buy the
shoes. The price of alone sensor is 100$ and depend on shoes companies about the
price of shoes. Which we know that our customer could consider to pay up to 300$-
400$ for pair of shoes.

Product Positioning: In fact, no sensor for embedded shoes monitoring in the market
yet which make our product very special. First, we will start with signing a contact with
shoes companies since we dont want to make our own shoes in the very first time.
However, after a year of contact. We will consider to make a transferable sensor based
on Jenny Simpson (Olympic bronze medal winner runner) idea. Then, we dont have to
care about the shoes companies anymore. You can easily plug and unplug the sensor
and place in any shoes you want. The quality and life-time of our sensor are much
better then the competitor. The price is a weakness but since we have a quality product
which will take interest in customer.

V. Competition
Profiles of Primary Competitors: Currently, there are five competitors in this market
for stress sensors, however two are major competitors as compared to other three. i.e.
Fujifilm and Tekscan are big competitors and Topaq, Tactilus and Diginip are small
competitors.

Functions Fuji Film Sensor Tekscan Sensor Senstech

Repeated No Yes Yes
Measurements (~100 load cycles) (Infinite load
cycles)
Dynamic Yes Yes
Measurements No (~100 load cycles, (Bandwidth ~
limited bandwidth) 200kHz)
+/- 3%
Accuracy 10% (immediately +/- 3%
following
Calibration)
Thickness 0.009 0.008 0.004
(inches) (inches) (inches)
Price 56$ 50$ 100$

Fuji Film Sensor- The stress sensor created by Fujifilm is not as thin when compared
to other sensors and it can be only used once. The accuracy of the sensors is not much
accurate compared to others and it has only one advantage i.e. the cost of the stress
sensors is low compared to others. Fujifilm is a giant company spread worldwide with
about $24 billion dollars and has partnership with other big companies for making
sensors for them.
Tekscan Sensor- The stress sensor created by Tekscan is not as thin when compared
to other sensors and it can be only used for 100 load cycles. The accuracy of the
sensors is not as accurate compared to others and it has to calibrated after every use.
Tekscan sensors and systems are used across a wide range of applications within test
and measurement, medical, dental, and retail; as stand-alone solutions or as embedded
technology.

Competitors Products and Market Share: The closest competitor to Senstech

occupies the largest portion of the market is Fujifilm and Tekscan as they main focus is
in measuring the pressure between the two contacting surface. Stress sensors of all the
competitors are good but not as good as compared to Senstech stress sensors in
accuracy and reusability. Major share of the market is taken by two big competitors i.e.
Fujifilm and Tekscan around 70% and the rest of the market share are divided in to
other three small competitors i.e. Topaq, Tactilus and Diginip.

Distinct Competitive Advantage: Senstech greatest strength among all the five
competitors is it is reused for decades and it does loose its accuracy when used
repeated amount of time. Senstech are mainly focused on two industries i.e. sports and
medical and other competitors are using they stress sensors in all the other field.
Senstech stress sensors are twice thin when compared to other competitors stress
sensors.

Competitive Weakness: Senstech stress sensors are quite high range in price as
compared to others in the market due to its high accuracy and can be reuse for
decades. Others stress sensors price they sensors around $60 and Senstech sensors
are $100 i.e. 40% more than other sensors. Senstech is comparing with two giant
competitors in the sensors market which already possess around 70% of the market
share and Fujifilm is a really huge company as compared to others around $24 billion
company which makes others pressure sensors, phone display screen etc. and they
exist worldwide.

Future Competitors: Fujifilm can be major treat in future as it growing rapidly and they
are innovating new technology in stress sensors similar to the Senstech sensors which
can give us hard competition in the market.

VI. Marketing and Sales Plan

Products Offered

SenseTech has 1 type of sensor that can be used for several purposes. Since our
product offers qualities such as wireless, durability, repeatability and accuracy,
manufacturing companies of sport shoes are interested in our technology to develop
special shoes that allow customers to improve their performance in sports. The sensor
also comes with a simple interface that is compatible with any computer operative
system and such interface may be manipulated as per customer needs.

At this point of the business, the sensor is mainly suitable for running shoes
development and the value proposition is to allow customers from the newbies to the
most experienced runners to have a practical, simple and accurate way to measure and
improve their performance when running. Among others, for final customers, the
sensors allow to measure foot position, foot pressure, stress points and potency. For
manufacturers, the sensor allows them to create any shoe design,

Pricing and Pricing Strategy

The average of our competitors price is around $60 dollars. Since one the main
characteristics of the competitors sensors is one-time use, our price will be $100 per
unit. The reason of setting $100 per unit has to do with the fact that the sensor can be
used infinitely time over its life cycle. In the same way since the cost of manufacturing 1
sensor is $30, we target to have as minimum 70% of profit margin.

Our strategy is also to sell the product by batches with minimum quantities of 10 units.
This will allow to increase the revenues per sale as well as to distribute the cost of
goods sold among units.

Distribution (Placement)

Our product will be sold with a direct sales model to large companies. We feel these
direct sales will need persuasion and support. Since the sensor will be manufactured
through an outsource company, it will be storaged in a warehouse owned by SenseTech
and then shipped to the manufacturing companies through FeDex and/ or USPS, and
the cost will be under the responsibility of the customer

Promotion

Advertising, marketing and selling Failsafe will be a formidable task but certainly not
insurmountable. Technology and innovation trade shows are common place. The
industry is rich in technology innovation events.

Advertising and Publicity

Technological magazines: At this point of the business plan the cost of advertising are
still in process of negotiation, nevertheless our estimated budget is $10,000. SenseTech
will invest in acquiring advertising spaces in specialized magazines. The following
magazines are potential options as budget allows: Popular Science, Wired, Technology
Review and Bloomberg BusinessWeek.

Online advertising:
SenseTech will take advantage of the free social media. Youtube will be the main
resource to create attractive videos of the potential applications of our product in the
different fields and those videos will be shared across the rest of the networks such as
Facebook, Instagram, Snapchat and twitter. The objective of the social networks will be
to attract potential customers, expose potential applications of our product and position
SenseTech as an Innovative company. The estimated budget for the On-line advertising
is $1,000 per month.

Trade Shows

Prior to the launch of SenseTech, Trung, Siewe, Zaid and Israel will attend tradeshows
(listed in table) to introduce SenseTech, establish a brand presence and perform focus
groups.

Upcoming Tradeshows

2017 MS&T - Materials Science and Technology Salt Lake City, USA

2017 Inpex - Invention/New Product Exhibition Pittsburgh, USA

2017 FABTECH Las Vegas, USA

2017 Itex Imaging, Technology and Education Expo Las Vegas, USA

The most important trade show for us is Itex. Annualy Itex attracts tons of business
solution expositors as well as potential clients. It also will allow SenseTech to build
partnerships with other companies.

Partnerships `

Our strongest partnership are Universities. We can take advantage of their computers
screensavers to post our product and application in order to promote research projects
that may use our technology. In exchange we may advertise their research projects and
engineering programs in our social media sites.

Discounts and Incentives

By now the only incentive that we may offer is to give trial products to our potential
customers. Since this is an advanced technology, we want to keep our brand to be
considered as specialized one.
 Sales Approach

The selected sales approach is based on direct sales model. The first step is to send
and e-mail to the potential customer with the main information and also with a catalogue
of videos of potential applications. Then we will try to contact him by phone in order to
explain more about the sensor and to solve doubt. In that call we will schedule a visit at
the customers location to perform a demonstration and to make a quotation (we may
also give a free trial). Finally, we are going to give back a phone call and set the
appointment to sign the contract.

Sales Forecasts (Bottoms Up)

Year 1 Year 2 Year 3 Year 4 Year 5

Assumption
Sales man 1 3 5 10 20
Calls per salesman per
week 15 10 10 10 10
Calls per salesman per
month (4 weeks) 60 40 40 40 40
Closing sales 70% 42 84 140 280 560

Target units per Call 10 20 20 30 50

Price per unit (1% increase $106.0 $116.92012
per year) $100 $101 5 $111.3525 5

Total sold units (annual) 420 1680

2800 8400 28000
$296,9 $3,273,763.
Total revenues (annual) $42,000 $169,680 40 $935,361 5