S-Cart – Background of CompanyEssay Preview: S-Cart – Background of CompanyReport this essay1.0 Introduction to the Company1.1 Company BackgroundK-Trend would be a new start-up company, founded by Koh Peik See and Khoo WaiMun. It will be located at an office space, 580 square feet, in Suntech, Bayan Baru, Penang. KTrend will plan to register as a company in 2011. K-Trend consists of a balance management
team with skills and knowledge in handling different tasks from different departments.S-Cart – the intelligent self-checkout trolley will be the first product that K-Trend wouldinvest in. The idea was a result from the analysis of the growth rate of hypermarkets inMalaysia, environmental needs (“Go Green” Campaign) and potential customers needs. It ishoped that S-Cart will bring added value to the shoppers and the hypermarket management interms of performance and cost. In order to ensure S-Cart provides added value to the customerand the shopper, research conducted to get feedbacks from customers and shoppers was used toevaluate the hypermarket customer satisfaction rate and acceptance of the S-Cart idea1.2 Business Intent and Clear Indication of Intended BusinessActivitiesAs a start-up business, K-Trend would focus on the retail industry by designingsolutions for them through research on market opportunities as a mean to further enhanceproduct design. Currently K-Trend is focusing on feasibility study for the business. Based onthe business feasibility study, it has been found that the cost to introduce S-Cart is still high inyear 2010. This is due to the costs of RFID tag (current price is at RM0.35 per tag). According toNeelima Sagar (2009), the adoption of RFID in retails sector would increase in near future (2011& 2012) while Ari Juels (2004) forecasts that the price of RFID tag would drop to RM0.16 innext 2 years. Meanwhile, RFID tags would be widely used for each of the product inhypermarkets. Based on the indication, K-Trend decided to introduce S-Cart in year 2011.Hence, there is no funding is required in year 2010, and hope to acquire funding in year 2011.K-Trend would design products for mini markets or hypermarket throughout Malaysia.For maximizing on companys revenues, K-Trend would outsource its development of prototypeto China. The main reason for outsourcing to China is due to the fact that China offers thelowest costs in terms of manufacturing and has massive skilled technology resource pool. In thefuture, most of K-Trends product designs will be evaluated before outsourcing to Asiancountries, whereby a marketing team would be in-charge of marketing and opportunitiesresearch to further expand the business revenues.The concept of S-Cart is formed through research carried out on market needs,environmental needs and the needs of the current trend in shopping. K-Trend is taking theopportunity to design a solution for hypermarkets in Malaysia and also a solution for consumersto have a pleasant shopping experience. It is hope that, the availability of S-Cart will enableshopping convenience for Malaysians with population size of 27,730,000 throughout allMalaysia cities.Few business activities are involved, including market research, product design,prototyping test, quality check, marketing programs and after sales services. From the initialstage, K-Trend would do some market research through surveys and interviews, to acquirepotential customers before proceeding to develop S-Cart. 10The development of S-Cart activities is shown in Figure 2.1:Figure 2.1: Activities involved in the development of the S-Cart 111.3 Growth StrategiesCompetitive Strategies: K-Trend would be sustains itself in the competitiveenvironment by using Michael Porters competitive strategies. There are three approaches to outperforming other competitors in the industry namely, overall cost leadership, differentiation, and
focus. (David A.DeCenzo & Stephen P.Robbins, 2005, pp. 105)Cost Leadership: K-Trend would offer the lowest price of products and services to competewith competitors. To be lowest price leader, K-Trend would price the products lower than thecompetitors about 3% -5 %.Differentiation: Product uniqueness is a value-added feature to the consumer. It is evaluatedand analyzed from the competitors products. K-Trend would then design solution for potentialcustomer which will be unique when compared to the competitors existing product.Focus: Target on specific niche market will be based on the needs of the current trend and theenvironment, as K-Trend is focused on designing solutions specifically for the retail industry,including mini markets, supermarkets and hypermarkets in Malaysia.To sustain itself in the competitive environment, K-Trend plans to follow a few strategies:1. Comprehensive study on customer behavior before
2. Design competition-related strategies that address different categories of the market, e.g. different market conditions on the market.3. Invest in existing products and solutions. With a K-Trend approach, consumers will be able to better connect themselves to new products and products to the existing product and to their existing platform, thus providing faster sales. K-Trend will develop such products that meet all criteria of market uniqueness, thereby eliminating the need for high volume marketing, as well as the need to build a customer base.1. Create unique product lineup. K-Trend will create unique products with unique product features that cater to the needs of a wide variety of consumers.2. Use the existing product lines in the new product category to get unique product features of all consumers.3. Leverage existing product development platforms to add products to the growing markets.4. Launch a new product channel that will connect consumers to the new products.5. Deliver a product on an all-day basis.6. Re-establish brand presence in a variety of markets.2. Create a unique product channel for the segment because, K-Trend believes, with its unique brand experience, the segment can grow faster.3. Develop a new model of buying services for the segment.4. Expand a new line of sales vehicles such as product kits and products and offer new range of products for the segment.5. Develop existing product segments, such as premium-grade systems such as iSmart and SmartCard.6. Reorient the sales segment, which will be based on innovative technology that has high revenue potential and lower marketing expenses compared to other segments by providing faster and more profitable sales.To maintain its market share, K-Trend will create more products to meet all customers of different categories of the existing product category, i.e. different types and conditions of the market. If sales of new product will increase, K-Trend will be able to offer discounts and discounts, which will be different for different categories. K-Trend must invest in new products and solutions and in order to retain the revenue generated for the segment, its market share must go up to the goal of 50% by 2020.1. Invest in a new product category that is based on the most relevant niche market. Therefore, the K-Trend solutions will provide more revenue opportunities in the first place compared to similar products in the same category. With this in mind, K-Trend does not believe that its products are being copied by other third party vendors that uses the same proprietary solution. K-Trend tries continuously to establish the brand as distinct from the vendor.2. Develop new products and products that meet the consumers’ needs.3. Establish partnerships with partners, i.e. with brand representatives, to build a stronger team of stakeholders to promote development.4. Create new products and products which meet the consumer needs of the brand and will be customized to meet the consumer’s expectations.5. Leverage existing product markets for the market in order to achieve success.6. Create and leverage existing customers’ loyalty and social network with existing product products.K-Trend will develop unique products that can compete with existing products, as the segment cannot be relied on as a partner for existing products. For this reason, K-Trend will start focusing on marketing the brand and new products first, and will focus on the specific requirements of the category of the current product.With K-Trend, all its products have to be able to be found in specific products, which should provide more customers with opportunities of choice. K-Trend will also develop different products that will achieve the customer’s needs. And