Engineering Practice ES342
MA&M INCORPORATION
By:
Muteb Alshaibani
13331394
Abdulaziz Alfuhaid
13315534
Muhammad Albuti
16765968
August 22, 2010
MA&M Sunshine Incorporation
Executive summary:
Mission Statement : Making cooking easy
Product and Market scope : Lower and middle income group.
Basis for differentiation : No power consumption and easy to carry and
use
Strategic Resources:
-Utilization of renewable energy resource
- Rising demand for cost effective fuel
Target Consumers- Mainly middle and low income consumers
Marketing and support:
- Free demonstrations
- Distributing pamphlets about conservation of renewable energy
-Advertisement in magazines
Pricing model: Manufacturing Price - $1,000
Sales Price - $2,500
Suppliers: Albuti Solar Appliances Co. and Alfuhaid General Electrical ltd,
USA.
Other Partners: Alshaibani Inc.,USA
Table of Contents:
Executive Summary
Introduction:
Company Name
Product
Organization Chart
Drawing
Project Planning:
Competition
Regulation and Codes
Business Model
License and Permits
Finance:
Estimated Cost
Capital
Other considerations
Conclusion
Appendix
Introduction:
The name of our company is MA&M Sunshine Incorporation. It is based in USA with its headquarters in Brooklyn, New York. MA&M Sunshine Incorporation is named to reflect the product it deals with. The MA&A are the first letters of the names of the founding fathers of the company. Our product concept is a Portable Solar Cookers. A solar cooker is a heavy appliance; therefore it is not easy to carry. Hence, we have tried to develop an alternative of solar cooker which can be folded and kept in a small space easily without the fear of getting broken. We have partitioned the body of the solar cooker so that it can be folded. Thus making it very portable and increasing its utility to outdoor travelling. Thus, it is no more than a simple household appliance.
Organization Chart:
Drawing:
Project Planning
Competitors and Comparison with our Product
Conservation of renewable source of energy is very important in the present times. There are large number of companies who want to explore this opportunity. It is a profitable venture more so as it involves low manufacturing costs. The top competitors for our company are Master Engineers, International Engineering and Trading company and Tinytech Plants.
Sunshine Product Comparison
Company/Details / Price / Portability / Efficiency / Ease ofuse / After
sales
services
Sunshine
Incorporation / + / +
Master
Engineers / +
International
Engineering
and Trading
Co / +
Tinytech
Plants / +
An analysis of the above chart reveals the comparative advantages MA&M Sunshine Inc. has over its competitors. MA&M Sunshine Inc. leads in thecategory of being the manufacturer of the most portable solar cooker. Itis so because of its design. It has been engineered in such a way that itcan be carried easily to its place of use. Another sphere of dominance of MA&M Sunshine Inc is the cheaper price of its product despite having anadded advantage.
As far as efficiency in working is concerned, we are making intense efforts in this direction. However, International Engineering and TradingCo definitely has an edge over others. It is an established organizationand with its positive and innovative attitude, it has been able to carve anniche in the market where competition is stiff and performance is theonly criteria.
Tinytech Plants leads the after sales service category because of its efficient, responsible and responsive services. Despite manufacturing themost expensive solar cookers, the Master Engineers lead the category ofbeing the manufacturer of easy to use solar cooker in the industry.Master Engineers are actually the pioneer manufacturers of solar cookers in the industry presently. They capture almost 60% of themarket share. Not only they are the current leaders, they also expandedtheir headquarters to other countries in 2008. These companies thoughcapture major market share, but they never endeavored to manufacture a solar cooker that could provide the consumers the ease of portability.Our company focuses on producing such solar cookers which couldbe folded and carried to any place of use, with much ease. This woulddefinitely make our product popular in a very short span coupled withadequate marketing strategy.
Another major competitor is Tinytech Plants which endeavors topromote renewable energy resources and making environment friendlyappliances. Though they provide the best after sales services in theindustry, we are keen to develop that aspect of our product developmentvery soon.
International engineering and Trading Company are the third largestmanufacturers of solar cookers. They product is very popular among theconsumers because due to their unique features it is very easy to operateand use. In the course of time we would definitely incorporate thisfeature which would provide a competitive edge to our product in thelong run.
Regulation and Codes that affect our product
The international Organization for standardization has established anumber of standards relating to solar energy equipments. Therefore solarenergy equipment must adhere to ISO 9050 relating to glass in buildingand ISO 10217 relating to materials used in solar cookers.
Our company needs to adhere to the regulations of Uniform SolarEnergy Code (UNEC). It is model developed by the InternationalAssociation of Plumbing and Mechanical Officials (IAPMO). We alsoneed to follow the norms of American society of Agricultural Engineers(ASAE ).
This standard is intended to:
-Promote uniformity and consistency in the terms and units used todescribe, test, evaluate solar cookers, solar cooker components andsolar cooker operation
-Provide a single measure of performance so that the consumersmay compare the different models while selecting a solar cooker
-Provide a common format for presentation interpretation of testresults so as to facilitate communication
Business Model
The mission statement of our company “making cooking easy” speaks for the goals of our company. We want to make portable solar cookers which can be folded and carried easily and anywhere. We can cook at the beach or on a picnic spot. That is the level of comfort our company is aiming to provide its customers. The product/ Market scope of our company is to cater to the needs of lower and middle income groups.
Our basis of differentiation lies in the portability of our product which none of the companies are offering in the present times. At the same time we have tried to keep our prices competitive.Strategic resources that make us stand out is the growing importance to make use of renewable energy resources. Also a public demand for easy to carry and cost effective means of cooking can get us into the market if people believe in our vision.We would like to advertize our product by providing free demonstration to people. We would also distribute pamphlets and educate people. Advertisement in magazines will be a means of popularizing our product.
Licenses and Permits
A great deal of research has gone into the requirements of getting the Sunshine Incorporation started. We will be located in New York and have found all the licenses and permits that will be required for its working. We need to obtain a Business License, Federal license and a sales Tax License. To ensure that nothing is left out, it’s imperative to appoint a lawyer. We have appointed Law Office of Frederic R. Abramsonas our official consultant and he has assured us that we are on the right track.
Finance
MA&M Sunshine Incorporation is designed to be a financial long term investment with a payback period of 4 years. The company is expecting to spend the entire first year and half of second year creating an excellent functioning design, scale model and beta model. Our business plan is very conservative in the sense that it has overestimated costs in every category.
The investment summary of Sunshine Incorporation is as follows:
Year 1 / Year 2 / Year 3 / Year 4 / Total costResearch and
development / $1000000 / $1020000 / $1050000 / $1045000 / $4115000
Engineering
costs / $95000 / $95000 / $95000 / $95000 / $380000
Manufacturing
costs / $150000 / $167000 / $124000 / $143000 / $584000
Management
expenses / $100000 / $100000 / $100000 / $100000 / $400000
Sales expenses / $150000 / $300000 / $345000 / $255000 / $1050000
Administration
expenses / $210000 / $210000 / $210000 / $210000 / $840000
Product testing / $230000 / $235000 / $210000 / $245000 / $920000
Misc expenses / $1200000 / $1200000 / $1200000 / $1200000 / $4800000
Total / $13089000
The following is a summary of expected revenue:
Year 1 / Year 2 / Year 3 / Year 4 / Total costExpected sales / 0 / 2000 / 2050 / 2150
COGS / 0 / $2650000 / $2760000 / $2850000 / $8260000
Sale Price / 0 / $5000000 / $5125000 / $5375000 / $15500000
Revenue / 0 / $2350000 / $2365000 / $2525000 / $7240000
Margin / 0 / $1250000 / $2100000 / $2350000 / $5700000
Return on investment / 0 / $1250000 / $2100000 / $2350000 / $5700000
Total Margin / $5700000
Critical Considerations
Since we are going to manufacture an eco friendly product, we must abide by the norms laid out for them. We must use the approved quality of materials in its manufacturing. The quality of the product should be of high standards. It must be able to meet the requirements of our target consumers fully. We will ensure that the manufacturing unit does not cause any environmental hazards. We shall endeavor to fulfill our social obligations.
As a company we shall keep our options open to facilitate any improvements in the product as and when needed. Our dedicatedResearch and Development team will be able to keep up with the growing and evolving market.
Conclusion
As time passes there is a huge increaseof Research and Development put into the information technology enablingbetter production. It targets the production of more sophisticated and eco-friendly products. Asstated in our mission statement our interest is to produce a costeffective and portable product, therefore this is the way it is going to should be done. The more details we put in this research the better our accomplishment. It appears that the market for it in Asia started a few years back, and that is why it is of great advantage to have this done in the United States. People in the USA care a lot about the environment and always strive to be cost efficient, and our product will bring what they need to them.
APPENDIX
Citation:
"The Solar Cooking Archive." The Solar Cooking Archive. N.p., n.d. Web. 20 Aug. 2010. <
"Welcome To TINYTECH Plants." Welcome To TINYTECH Plants. N.p., n.d. Web. 20 Aug. 2010. <
"Solar Cookers." Products Directory,Indian Products Directory,Wholesale Products Directory,B2B Products from India. N.p., n.d. Web. 20 Aug. 2010. <