Tyler- Communications

Shafika- Marketing
Naif- Finance
Feb 17, 2016
Economic feasibility for customers:
Cities that would use our product would save %90 amount of electricity per year
$66/signal and would be able to cover their costs in less time than usual
How to produce the product:
Since it is a technology we are not familiar with, we will need to hire people who
specialize with products in this market. We would hire a team of engineers to develop
product, outsource production for lower costs, and perform rigorous quality control tests
to ensure the reliability of the product.

Feasibility Study
Areas of focus
Legality:
Adhere to State laws, in our case MA.
Technology:
We will subcontract a group or small local electronics engineer company to
develop the technology.
Possibly merge with small company to use their employees for product development
Finance:
Find investors to get a business loan.
Cost of raw materials will be approximately $500
-Aluminum $0.20 per lb.
-Copper $1.97 per lb.
Labor cost: $100 per hour, 3 hours per light.
Cost of manufacturing will be approximately $4,000

Marketing:
Target market- Metro Boston area, smaller cities to start. Target small cities with
outdated equipment.
Smaller niche markets- Specialty lights for things like go-kart racing, drag racing, etc.
How to implement in cities/towns- research rules and regulations of traffic laws
Traffic Signals
Option to program them for different uses if they are used at a private facility like a
racetrack.

Unnecessary traffic is diminished

o

With sensors we can be specific with traffic light durations, if one lane has
more traffic than the other we would keep the traffic moving whereas an
empty lane will stay red if no cars are sensed.

With our system we will give taxpayers more of their moneys worth
o

Modern traffic lights cost about $100,000-$300,000 per unit, but with our
smart traffic sensor system, taxpayers will be paying about the same for
each traffic light but will be getting more from a safety and time saving
perspective

Using LED can save up to $600 yearly at a single intersection

o

LED lights cost around $70 per traffic signal ball compared to a normal
traffic light costs $20. When energy and maintenance expenses are added
the total operating cost for the LED lights is approximately 70% less than
normal lights.

LED lights will save a significant amount of energy. if a normal traffic

light uses 100-watt bulb operating 24 hours per day, it will use 2.4kilowatt hours (kWh) a day. Assuming that the cost of 8 cents per (kWh),
the signal will cost around 20 cents per day or $72 per year. Using a LED
light instead will consume about 10-watts, which will cost around $7 per
year.

Cons of traffic signals

Although traffic signals can reduce the number of angled collisions, it can also
cause increase in rear-end collisions

Unjustified traffic signals can cause delays and cause people to disobey signals as
well as divert to other routes

Pros of traffic signals

Maximum control at an intersection

Assign the right of way to conflicting movements of traffic at any given

intersection
o

Allowing conflicting streams to use the same intersections at different

times does this.

Increase the traffic handling capacity of intersection

On a red light with a no turn on red sign on the street, our light will also say no right
turn, as an extra reminder if the street sign is overlooked by drivers. This also opens the
possibility of eliminating the no turn on red street sign.

What makes it special?

It is a completely new traffic light. Its appearance is a nice big clear screen that would
give the city a more modern look.
How is it different?
Has a large screen and can perform different functions. Alerts drivers of oncoming
emergency vehicles. Saving time for ambulances for example, could save lives.
How do the customers benefit?
our customers would be small and large cities, so energy saving would be huge amongst
other savings. A reduction in accidents will reduce taxpayers costs as well, and since our
lights alert drivers of oncoming emergency vehicles, they will be able to arrive on the
scene faster.
How do the drivers benefit?

The drivers will know when a red, green, or yellow light will change. We believe that the
traffic will flow smoother when the drivers are aware of the changing lights. often times
drivers get distracted at red lights and tend to look around in boredom and sometimes
miss when a light turns green.

Communications
Smart Signal Traffic light
We invented a revolutionary traffic light called Smart Signal. It would replace the
existing lights, replacing the old technology. Smart traffic is a growing industry, and with
our foot in the door early it will give us a chance to grow and be successful early on. our
plan is to look into how we will be able to finance, develop, market, and distribute our
product. A single fatal crash costs society $6.43 million in 2013 dollars, and includes
costs to victims, families, government, insurers and taxpayers. We believe that our
product can prevent thousands of accidents across the US as well as save lives.
The features of our light:
-Smart Traffic Light System that has an LED screen similar to a television that
shows traffic signals with a numbered timer within each colored signal (red, yellow,
green).
-The screen will also display emergency symbol to warn drivers and pedestrians of
oncoming disruption and emergency vehicles including fire trucks, police cars, and any
city or state emergency vehicles.
-If a pedestrian is walking and a car wants to turn the screen will inform them
through a sensor that a pedestrian is crossing the road.
-Traffic light system will have a sensor that notices more traffic on one light so it
would make the green light stay on for longer, however this will be up to the city and
how they want to regulate their traffic.
-On a red light with a no turn on red sign on the street, our light will also say no
right turn, as an extra reminder if the street sign is overlooked by drivers. This also opens
the possibility of eliminating the no turn on red street sign. Which in turn, could add
additional savings.

-It will be designed to be compatible with the existing street poles so the city or
town can operate it.
-We will also create a special remote/GPS with a touch screen similar to the average
GPS you can buy at a store for emergency vehicles. It will give the user the opportunity
to choose what street signs to alert oncoming traffic of their arrival.

There are a few questions to be asked when developing the product,

What makes it special?
It is a completely new traffic light. Its appearance is a nice big clear screen that would
give the city a more modern look. Timed lights exist in places like china, however not in
the US.
How is it different?
Has a large screen and can perform different functions. Alerts drivers of oncoming
emergency vehicles. Saving time for ambulances for example, could save lives.
How do the customers benefit?
Our customers would be small and large cities, so energy saving would be huge amongst
other savings. A reduction in accidents will reduce taxpayers costs as well, and since our
lights alert drivers of oncoming emergency vehicles, they will be able to arrive on the
scene faster.
How do the drivers benefit?
The drivers will know when a red, green, or yellow light will change. We believe that the
traffic will flow smoother when the drivers are aware of the changing lights. Often times
drivers get distracted at red lights and tend to look around in boredom and sometimes
miss when a light turns green.

Legality:
In order to start production we must comply with all rules and regulations in place
that pertain to our product. To start, our product must be UL approved like most other
electronics. The process involves submitting our idea for approval along with a few
prototypes to test. This does cost a fee to have them tested.
Since the light is essentially a computer screen we can display whatever we want
on it, so any regulations imposed by the city or state can be edited in the software. That
way all of the hardware can be manufactured the same way to reduce some of the
production cost.
MassDOT is one of our biggest interests to invest and use our product. Because
they believe in the same values we have, we know that we can work together to make a
better and safer world for drivers and pedestrians worldwide, even if it only starts with 20
intersections. With a Master Electricians License in the State of Massachusetts, we are
sure to successfully sell and produce LED traffic screens for the State of Massachusetts.

MassDOT

Mission: To deliver excellent customer service to people who travel in the

Commonwealth, and to provide our nations safest and most reliable
transportation system in a way that strengthens our economy and quality of life.
Dedication: We will provide service around the clock under all circumstances
Innovation: We will improve and integrate transportation services using creative
thinking and best available practices and technology, while minimizing disruption
to the public.

Finance

Fixed Cost:
- Land

$120,000

- Equipment

$30,000

- Employees Wage

$100,000

- Total

$250,000

Variable Cost:
- Utilities

$20,000

Cost of Manufacturing (Per Unit):

- Raw material

$700

- Aluminum

$100

- Copper

$100

- Smart Signal Board

$500

- Labor cost

$525

- Engineers wage

$900

- Distribution cost

$500

- Installation Cost

$400

Total Manufacturing cost

Selling Price:

$3,025/Unit

Our plan is to start with 20 intersections in the City of Boston. Each intersection will
include one smart traffic signal. Our selling price will be $7,000/Unit.
Revenue/unit: $7,000-$3,025 = $3,975
Total Revenue: $3,975*20 = $79,500
Break-even Analysis:
Our target is to sell 200 units to MassDOT in the current year; ($3,975*200=
$795,000). Therefore, we would be able to breakeven in less than a year. Our total
expenses approximate $270,000, in addition to the cost of manufacturing each product.
In order to reach our breakeven point, we need to sell 68 units.
We profit $3,975/unit.
$3,975*68= $270,300
Then, we will be left with utilities expenses and the cost of manufacturing, which is
covered after selling the unit.

Marketing
Traffic signals play a huge part in day-to-day lives to maximize the safety and
efficiency of drivers on the road. But traffic signals are just a small part of what a branch
of civil engineering likes to call traffic engineering. This type of engineering focuses on
safe and organized traffic systems; including sidewalks, cycling lanes, traffic lights, and
traffic signs. Traffic engineers are involved in designing systems and devices that would
serve as guides or safety rules on the road. They also research locations with high rates of
crashes and work to find solutions to maximize safety and efficiency at those
intersections.
Because traffic signals are not a popular business to get into, we believe that
creating and developing this device, many investors, cities, and families would rather
have our product on the road. By using LED screens to control traffic, drivers will get
more than just a solid red, yellow, or green light. Our revolutionary LED screen will have
the usual 3-signal lights apparent, but what differs it from the regular traffic signal is the
count down located on the screen for each color. By effectively using data and
information gathered by our engineers, we will be able to increase effective traffic flow

and minimize traffic where it need not be. Drivers will also have the benefit of knowing
when an emergency vehicle is on its way. When a police, fire truck, or ambulance
approaches, the LED screen will notify the driver at the intersection and flashing red
lights will illuminate surrounding the screens. To take extra precautionary measures for
pedestrians, underground sensors will trigger when a pedestrian is walking, and both the
LED screen and signals on the ground will illuminate to let the driver know that a
pedestrian is crossing. This will really improve the percentage of day and night casualties.
Our screen will be compatible with current traffic signal poles; this will make the
transition from current signals to LED screens easier. Future advancement in LED screen
poles could be possible. Because engineering is a sought after field to go into, there is
plenty of room for growth and we are hoping to create many job opportunities for civil
engineers in the next decade. Our biggest rival would be GE as well as other lesserknown companies that currently do standard traffic lights. This is a fairly new technology
and there is currently nobody doing anything like this. There could be a possible threat to
competition, but as previously mentioned, there are such limited companies in this
industry and even such, only a handful of them would be used by the City of Bostons
Department of Traffic (DOT).
Currently, we have no client base as we are looking to start our first breakthrough
covering 20 intersections in the City of Boston. We are also looking to meet with
engineering companies who would potentially invest in our product. Our target client
base is the government entities especially departments of traffic that issue and signal all
regulations and controls for traffic engineering.
We at Smart Signals believe that with the proper technology, using appropriate
raw materials and distribution channels, we will be able to successfully produce and
distribute LED smart traffic signals to the City of Boston. By already obtaining a Master
Electricians License in Massachusetts, and having little to no competition in the industry,
marketing the Smart Signal to local MassDOT agencies will be fairly simple. Consumers
and citizens of local communities depend on the engineers and developers to keep and
maintain a safe and efficient transportation environment. Because our product is one of a
kind and technology plays a big role in our proposition, there could be threats of new

entrants, and even competitors such as General Electric could gain insight on our idea
and perhaps improve on it.