Techsonic

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INTRODUCTION After several new product failures, the company began using customer input to help develop new products. In 1989, the fishing electronics industry is experiencing a downturn, and the company's sales and profits are slipping. The company, which has one product line (depth sounders) and a strong brand (Hummingbird), has conducted substantial market research on three new products. These products are project 901, hummingbird VHF Radio, Locator/ GPS navigator. Of these, project 901 is an extension of the depth sounder product, while the other two would be new product lines for the company. Top management is deciding which one or more of the three new products it should proceed with. In this paper, I will discuss the positive and negative aspects of each product ideas and my recommendations to Techsonic management New product ANALYSIS Listening to customers is the foundation of techsonic corporate structure. As sich techsonic business strategy puts customer needs on top of all initiatives. In this section, I will analyze the each techsonic new product ideas to make a decision of GO/ NO GO for each idea. I will measure each product using the following criteria. 1. Will the Project align with Techsonic business strategy? 2. Importance of the project to the business? 3. Extent to which the product will meet customer needs 4. Market size and growth rate if the product is commercialized? 5. How the project will leverage our marketing, distribution, and technological and manufacturing strengths? 6. Is the project technically feasible? 7. Expected profitability based on NPV? Project 901 This product is an extension to depth sounders. It is aimed at satisfying the important benefits that anglers sought 1. Find ... ... middle of paper ... ...f commercial success is 50% 50% of surveyed Customers are not aware of a locator brand and we cannot be sure if techsonic can produce a product that can address customer's problems. So probability of technical success is 50%. Locator market is very fragmented and we cannot be sure if techsonic locator can be commercially success GPS has a greater chance to be if technically successful if techsonic makes a joint venture with STEL (75%). GPS is a new product with great promise and 50% of surveyed customers are not aware of the product (Hence 50%) PROJECT INCOME STREAM COMMERCIAL COSTS DEVELOPMENT COSTS PROB OF TECH SUCCESS PROB OF COMMERCIAL SUCCESS NPV 901 19.85 12.73 0.61 100% 100% 6.51 VHF 2.95 2.09 0.576 100% 50% -1.2 Locator 2.54 1.99 0.30 50% 50% -1.74 GPS 7.52 2.38 0.76 75% 50% 0.275 Based on NPV analysis, Techsonic should do 901 and GPS projects

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