Marketing Plan

On
the sHv Laptop Computer
1.0 Executive summery i
2.0 Situation Analysis 1
2.1 Market Summary 1
2.1.1 Market Demographics 2
2.1.2 Market Needs 2
2.1.3 Market Trend 3
2.1.4 Market growth 3
2.2 SWOT Analysis 4
2.2.1 Strengths 4
2.2.2 Weaknesses 6
2.2.3 Opportunities 7
2.2.4 Threats 9
2.3 Product Offering 12
2.3.1 Product review 13
2.3.2 Product Support 14
2.3.3 Consulting Services 14
2.4 Competitive Review 14
2.4.1 Competitor Features Price 14
2.4.2 Comparison of different laptop producers 17
2.5 Key to success 17
2.6 Critical Issues 18
3.0 Marketing Strategy 19
3.1 Mission 19
3.2 Marketing Objectives 19
3.3 Financial Objectives 20
 3.4 Target Markets 20
3.5 Positioning 21
3.6 Marketing Mix 21
3.6.2 Pricing 21
3.6.3 Distribution 22
3.6.4 Communications 22
3.7 Marketing Research 22
4.0 Financials, Budgets, and Forecasts 23
4.1 Break-even Analysis 23
4.2 Sales Forecast 24
4.3 Expense Forecast 25
4.4 Linking Sales and Expenses to Strategy 26
5.0 Controls 27
5.1 Marketing organization 27
5.2 Contingency Planning 27
 Executive Summery

The sHv Digital Technology is going to introduce its new product ‘the sHv
Laptop’ with a view to reach a laptop to everyone. The sHv Digital Technology is
purely a Bangladeshi organization which has some foreign allies as well. The
laptop we are going to market will be locally designed and assembled using our
own expertise and experience. This is for the first time a Bangladeshi organization
is going to produce such kind of product. Our first mission is to meet the local
demand and then go beyond the country to be an international venture.

The goal of this marketing plan is to outline the strategies, tactics, and programs
that will make the sales goals outlined in the ‘the sHv’ business plan a reality in the
year 2009.

The sHv, is going to offer a wide range of laptops with different level of
performance based on the need of its target customers in a cheaper rate. Our main
objective is to grab the growing demand market of laptop computers which is now
occupied by several foreign companies. Using our local talents we will offer
innovative products and quality service.

Inexperience, access to the technology and market size is some weaknesses of our
effort but we can overcome it.

Opportunities are immense in this field. As technology is getting closer to people

they are more attracted to laptops that the traditional desktops. Our mission is to
clean those desks up and put the sHv on the lap.
For any new business there are lots of threats. Our well defined strategies to
overcome those will soon make us the market leader.

Marketing will play a vital role in the success of the sHv. It must build a brand
around the product it offers by heavily promoting itself through local television,
radio, and print advertising. Marketing efforts are just beginning by the time a
potential customer hears the name of the sHv for the first time. A strong emphasis
will be put on keeping customers and building brand loyalty through programs
focused on staffing, experience, and customer satisfaction.

Our target market is divided into consumer market and business market.
Professionals and students are among the consumer market and corporate users and
entrepreneurs are among the business market.

We put immense importance on value poisoning of our product. To achieve this we

will hold seminars in various universities and business organizations. Taking part
in computer fairs and similar shows will also be included.

A heavy promotional activity will be launched to make the product familiar. A

strong distribution network will be created to reach the end value to the ultimate
customers.
2.0 Situation Analysis

the sHv is entering into its first year of production. Its products have an increasing demand in the
market. There are several competitors in the market. So we will put our best effort to the quality
and service to own the market. Our marketing key to success is to the development of brand and
product awareness as well as the growth of the customer base. A strong brand image will be
made so that there is a high demand for our products than the competitors.

Currently the companies who are selling laptop in our market are all foreign. The sHv Digital
technology is eyeing to be the market leader by using our local expertise. We have a lot of talents
all around us. These talents can have a major contribution in the economy. The sHv will make t a
field for these local talents to show their talent and use their expertise in their own territory.
Using the geographic and demographic advantages ‘the sHv’ will be the market in the laptop
market in five years.

2.1 Market Summary

‘the sHv’ is faced with the exciting opportunity of being the first-mover in the local laptop
market. The consistent popularity of computer, combined with the growing interest in the laptop,
has been proven to be a winning concept in other markets and will produce the same results here.

All our target markets are growing at a relatively fast pace. We're faced with a large number of
potential customers, and we're offering a quality service.

2.1.1 Market Demographics

 Geographic

The sHv will operate its business int its own country only for the first two years and then it
will move to grab the international market in Europe, Latin America and other western and
Eastern countries.

Demographics

sHv’s customers can be divided into two groups. The first group is consumer market.
Professionals and students belong to this group. Porfessionals can be various types of
profession who need s to have a digital device with them. Students of universities are our
main focus. The growing demand of laptop among the students made the market so
attractive.

The second group is the business market. Corporate user, Entrepreneur, Medical users are
among this group. Although they are very near to the professional users but we segmented
them differently to attract them in a different way.

2.1.2 Market Needs

When a computer manufacturing company wants to start a new operation in its home country,
specially for the first time there is a temporary need for very high-powered expertise. They need
to establish distribution, evaluate distributors' merits and problems, select and open new
channels. We will use our local and international expertise to face these challenges.

We understand the need for quality and service of our customers. In this regard we are hundred
percent committed and will have no compromise about the quality. Our post purchase service,
which is very much importat ni this sort of product, will be stronger than the other foreign
competitors.
From the point of view, our clients will come to us at least in part because we reduce their sense
of risk. If things go wrong, they have experts to blame. If things go right, they get the credit.
There's the old saying that "nobody ever got fired for choosing IBM," meaning choosing a highly
respected visible source for computers. We are that kind of low-risk option for opening new
markets.

2.1.3 Market Trend

When considered in aggregate, the total market for computers, laptops and other related
accessories is huge. By any estimation that is a very large market. However, despite its size, this
is not a stagnant market; it is a robust and expanding market. With a new era of technological
growth, the overall market is expected to continue to grow well into the next century.

2.1.4 Market growth

While a historical perspective is valuable, what is most important with respect to the sHv Digital
Technology is future growth. While it is impossible to predict the future with 100 percent
accuracy, it is possible to gain a sense of what is likely to happen and gain an appreciation for the
size of this ever-expanding market.

The market for the sHv laptop is growing rapidly. The compant hasn't come to production this
area yet, but similar services are growing rapidly on a global scale. Large cities that cater to large
numbers of travelling business people and tourists have been saturated with businesses using
laptop. Business people use the Internet services to catch up on email and communications with
their family, and tourists do the same. So they need a portable laptop which is easy to carry and
also fashionable. Our area supports a population that has many of the same needs and interests of
this larger group.
2.2 SWOT Analysis

The SWOT analysis provides us with an opportunity to examine the internal strengths and
weaknesses the sHv must address. It also allows us to examine the opportunities presented to the
sHv as well as potential threats.

the sHv has a valuable inventory of strengths that will help it succeed. These strengths include: a
knowledgeable and friendly staff, state-of-the-art computer hardware, and a clear vision of the
market need. Strengths are valuable, but it is also important to realize the weaknesses the sHv
must address. These weaknesses include, a dependence on quickly changing technology, and the
cost factor associated with keeping state-of-the art computer hardware.

the sHv's strengths will help it capitalize on emerging opportunities. These opportunities include,
but are not limited to, a growing population of daily laptop users, and the growing social bonds
fostered by the new communities. Threats that the sHv should be aware of include, the rapidly
falling cost of Internet access, and emerging local competitors.

2.2.1 Strengths

The sHv can build on the following strengths:

True expertise

All of our principals know this area very well. Our experience and expertise is better than
anybody we know of in this particular niche area.
Specialist marketing expertise

We have a team of experienced and highly talented marketing expertise who can contribut
to the fast growth of the company.

New/innovative product or service

Our product design and offerings will be different than the competitors which will make us
identical to our target customers.

Location of business

Our current location of business is inside the country which is showing a high growth
towards the technology based products. We also have a plan to expand our business outside
the country.

Quality processes and procedures

We have no compromise with the quality. Quality is first in our concern.

Price is lower than the competitor

All our competitors are from abroad who incur high production cost and export and import
duties. As we are using our local expertise the production cost is minimum and it will help
us to offer relatively lower price than our competitors.

Contacts
 Years of industry experience means a lot of word-of-mouth marketing, contacts, and
networking.

2.2.2 Weaknesses

Weakness could be

Lack of marketing expertise

As a group, we are good at the direct sales involved in making a close, but we don't have
the resources required to do much general marketing. We will depend on word of mouth
first as our main form of generating leads.

Staff

Without the overhead of staff, we can't leverage on people to develop documents and
presentations, research in detail, and fill in the blanks. We are short on support for
telephones, fax, and email.

Lack of brand awareness and image

There are many competitors in the market like Compaq, Dell and newly emerging HP,
Acer who have already developed a high brand image. We are a new entity, we can be
perceived as an innovative -- and therefore risky -- choice.
 Location of business

If we only restricted in the local market it would be difficult for us to achieve our desired
goal. The population of the market is not so big in Bangladesh. Moreover it is also not
possible to grab the 100% market. So there is a high risk of loss.

2.2.3 Opportunities

The sHv can take advantage of the following market opportunities

A developing market such as the Internet

internet using is improving in an immense pace. Using the internet with the laptop is
getting popular. Our offerings will be focusing on this issue.

Mergers, joint ventures or strategic alliances

There are many marketing expertises in the market. And also there is an opportunity of
merging with other related companies. Joint ventures with other manufacturers can be a
helpful tool. There is also opportunities of strategic alliances.

Moving into new market segments that offer improved profits

Computer market is expanding is increasing day by day with an immense pace so is the
laptop market. Our objective is to attract this potential market towards us. New markets are
ivolving everyday. These show a high profit opportunity for the firm. The ever growing
industry shows a potentiality in growth to new market segments with improved profit.

A new international market

 Our objective is not to confine ourselves into tshe local market only. We are looking to
expand our market internationally. Our main concern is the developing countries where
computer technology is boosting. To grab and to serve the market for higher profit.

A market vacated by an ineffective competitor

Many competitors are coming in the market who occupies a part of the market but all
cannot servive. They leave the market and our concern is to grab that segment before
anybody can.

Increasing demand for multiple communication methods

The demand for multiple communication methods are increasing. This is also a form of
opportunity for our firm.

2.2.4 Threats

Internal Risk Factors

A product road map which leads to the development of new functionalities and the
enhancement of existing system modules which are in-line with customer expectations.

Ability of the company to attract, train, and retain qualified technical, sales, marketing,
financial, and management personnel to meet the challenges of growth.

Attraction of adequate initial capital to jump-start the company to the next level. These
funds will allow the company to hire needed resources, open regional sales offices, develop
OEM/system integration relationships, and develop system enhancements and new product
offerings on a more timely basis.

External Risk Factors

Competition in the market is highly competitive and the company expects this competition
to increase. Not only does the company compete with other independent producers of
laptops but it also has to compete with the newly emerging business powers.

It is expected that continued growth and competition in the laptops industry, and the
entrance of new competitors into the market will continue.

Alternative pricing arrangements may be required to cultivate relationships with new

market entrants, and to a lesser degree with established companies. These arrangements
may call for deferred payments. However, if the company permits customers to pay for its
products and services on a deferral or revenue sharing basis, the company may ultimately
be unable to collect payments for such products and services.

International factors may cause significant risks to the company. The company's business
may be subject to unexpected changes in: regulatory requirements, tariffs and other trade
barriers, costs of localizing products for foreign countries, lack of acceptance of localized
products in foreign countries, longer accounts receivable payment cycles, difficulties in
managing international operations, political instability, potentially adverse tax obligations,
restrictions on the repatriation of earnings and the burdens of complying with a wide
variety of foreign laws and regulations.
Fluctuations in exchange rates between the United States dollar and foreign currencies may
have a material adverse effect on the company's business, results of operations, and
financial condition and could result in exchange losses. There are no assurances that any
hedging techniques implemented by the company will be successful.

The laws of certain countries in which the company may sell its products and services do
not protect the company's software and intellectual property rights. As a result, it may be
possible for a third party to copy or otherwise obtain and use the company's technology
without authorization, or to develop similar technology independently. If this occurs to any
substantial degree to the company's business, results of operations and financial condition
could be affected.

An integral factor in the company's growth strategy is the development of third party
relationships with a number of consulting and systems integrator firms to enhance its
marketing, sales, and customer support efforts.

The benefits are in respect to installation and support of its product and lead generation and
assistance in the joint marketing and sales efforts in order to generate new business
opportunities.

Failure to generate these relationships will have a negative impact on the company's ability
to meet its targeted growth in sales.

Other Risk Factors

Other factors that could be treated as threats for the company are.
New competitor in home market

If the market shows a success there would be new competitors coming into the market. To
face them will be a challenge for the firm.

Price wars with competitors

When we will come in the market with lower price offers the competitors are also supposed
to do that. As new comer in the market it will be a real challenge for us to face this
competition along with creating a brand image.

Competitors with new, innovative product or service

New, innovative product or service offered by the competitors may lead the customers to
be attracted to the competitors.

Competitors have superior access to channels of distribution

There many firms in the market who is doing business for many days and have a good
distribution channel to reach the customers. So we must have to have a smooth channel of
distribution to reach and hold our customers.

Taxation introduced on product or service

if government imposes new taxes on computer accessories and don’t patronize the local
producers it will be difficult to offer lower price than the other firms in the market.
2.3 Product Offering

We cannot think the modern civilization without computer. Many people are using Desktop and
Laptop computers in their daily life. Bangladesh is not out of this. Many people use Desktop
Computer according to their requirement. But there are so many problems in case of desktop
computer such as heavy and difficult to take one place to another. To reduce such kind of
difficulties anyone may use laptop computer. The use of laptop computer is increasing day by
day. In Bangladesh, many people is using laptop computer for their office or home. Young
generation are increasingly getting interested to the laptop.

There is a huge market of laptop computers in Bangladesh. We are looking to grab this local
market and expand it to beyond the country border. With this view ‘the sHv’ Digital Technology
is going to offer the following products.

I. the sHv Laptop

II. the sHv laptop accessories

2.3.1 Product review

the sHv Laptop

the sHv Laptop NP-R20R001/SUK

• ATI Radeon Express 1250 M 128 Mb Shared

• HDD 80 GB (5400 RPM) SATA

• 14.1" Super Bright non Gloss WXGA (1280 x 800)

• 1024 Mb DDR2 (512 x 2)

• Microsoft® Windows® XP Pro

 CPU Intel® Core™ Duo Processor T 2350 ( 1.86 GHz)

Operating System Microsoft® Windows® XP Professional

Core Chipset ATI RS600ME with 533 MHz FSB

Display 14.1" Super Bright Non Gloss WXGA ( 1280 x 800 )

Graphics Card ATI Radeon Express 1250 M 128 Mb Shared

Memory 1024 GB (512 x 2) DDR2

Hard Disk 80 GB Sata HDD 5400 RPM

Optical Drive DVD Super Multi Writer

Card Reader 6 in 1 ( memory stick/Pro, SD, Xd Card, MMC, High speed MMC ready)

USB 3 x USB 2.0

Modem Internal 56 Kbps V92

Ethernet LAN 10/100

Wireless LAN 802.11 b.g

Warranty 1year Fast Guard Collect and Return

Anti-Virus McAfee Virus Scan

Weight 2.39 Kg weight

Dimensions W 340 x L 259.6 x H 27.7-38.7 mm

$1490

2.3.2 Product Support

In support of product sales, the sHv Digital Technology will offer a number of services such as
installation and configuration, as well as warranty and post warranty support services.

2.3.3 Consulting Services

‘the sHv’ will develop most of its products to date through projects delivered as part of its
consulting services group. Services offered under the umbrella of the consulting services group
include consulting, project development, and implementation. This enables the sHv Digital
Technology products to be closely tailored to customer needs.

2.4 Competitive Review

Our competitive edge is our dominance of high-technology ergonomics and traditional high-
quality laptop. Although there are many laptop manufacturers, and many computer lovers, few
have brought the quality.

2.4.1 Competitor Features Price

 Dell

• Intel® Core™ Duo Processor T 2350

( 2.0 GHz)

• 15" Super Bright Non Gloss WXGA

( 1280 x 800 )

• 60 GB Sata HDD 5400 RPM

• 1.89 Kg weight

• Six month Fast Guard Collect and Return $1820

 Sony • Intel® Core™ Duo Processor T 2350

( 1.86 GHz)

• 14.1" WXGA TFT display

• 80 GB Sata HDD 5400 RPM

• 1.5 Kg weight

• 1 year Fast Guard Collect and Return

$1600

 Hewlett Packard (HP)

• Intel® Core™ Duo Processor T 2350

( 1.86 GHz)

• 14.1" Super Bright Non Gloss WXGA

( 1280 x 800 )

• 80 GB Sata HDD 5400 RPM

• 2.39 Kg weight

• 1year Fast Guard Collect and Return

$1810

 IBM

• Intel® Core™ Duo Processor T 2350

( 1.86 GHz)
 • 14.1" Super Bright Non Gloss WXGA

( 1280 x 800 )

• 80 GB Sata HDD 5400 RPM

• 2.39 Kg weight

• 1 year parts and labor (carry-in) International Limited Warranty & 1-year battery (carry-
in) Warranty

$1650

 Toshiba

• Intel® Core™ Duo Processor T 2350

( 1.73GHz)

• 15.4" WXGA TFT display

• 80 GB Sata HDD 5400 RPM

• 2.39 Kg weight

• 2 year parts and labor (carry-in) International Limited Warranty & 1-year battery (carry-
in) Warranty

$1590

2.4.2 Comparison of different laptop producers

Dell: Dell is one of the recognized computer manufacturers. They also produce high quality
laptop with cheaper price. The performance of their laptop is better then the other competitors in
the market. Their laptop is within $1820
Sony: Sony is producing good number of laptop for the market. At the early age they were
suffering many for the quality. But now days they are manufacturing better quality laptop.

Hewlett Packard (HP): HP world class laptop producer, operating their business all over the
world. HP is now providing laptops in cheaper price. Their marketing strategy is so good that
many companies follow them. Their laptop is in different price.

IBM: IBM is recognized as one of the best laptop producer who always prefers to care the
quality. Their laptop is always with many features. The price is also reasonable.

Toshiba: Toshiba, the electronic product producer is now producing high quality laptop. Their
other products were so better that people trust them. They are supplying laptop in the market of
Bangladesh.

2.5 Key to success

Uncompromising commitment to the quality of the end product

Quality product, quality workmanship, quality design, quality of end result is our main
concern

Successful niche marketing

We need to find the quality-conscious customer in the right channels, and we need to make
sure that customer can find us.

Almost-automatic assembly
 We can't afford to ship fully-assembled products, but assembly must be so easy and
automatic that it makes the customer feel better about the quality, not worse.

2.6 Critical Issues

The critical issues include the following

Tracking and follow-up

Will we have the discipline, as an organization, to track results of the marketing plan and
make sure that we implement?

Market segment focus

How can we be sure we have the discipline to maintain the focus?

Saying no

Can we say no to special deals that take us away from the target focus? Can we say no to
unprofitable deals?

3.0 Marketing Strategy

Strategy is focus. Our strategy involves focusing on a specific area of expertise in which we are
as strong a group as in any company anywhere in the market. We are true experts in the
introduction of new technology products, especially through channels of distribution.
The sHv will focus primarily on local geographical market. It will be expanded to the United
States, Europe, and Latin America, and in limited product segments; personal computers,
software, networks, telecommunications, personal organizers, and technology integration
products.

3.1 Mission

Our mission is to be the provider of high value, high quality, convergent OSS solutions to laptop
users countrywide and worldwide. These scalable solutions will have unparalleled support to
ensure flexibility and to meet and exceed customer expectations.

The sHv's marketing will consistently build on this mission. Everything we do, from the pricing
structure for our services to the ambiance we create, must be done with this mission in mind. We
cater to: professionals, home users, university students, and seniors. Our ambiance and our
services are designed for this clientele and our marketing efforts are focused on capturing this
market.

3.2 Marketing Objectives

The sHv's marketing objectives for the first three years of operation include:

• Grow total sales by 10% annually.

• Diversify the service offering to insulate the business against fluctuations in any one
component of the revenue stream.

• Build customer loyalty through educational programs.

• Maintain a staff of enthusiastic employees excited to share their knowledge with the sHv
customers.
 • Build the ‘the sHv’ brand to the point where it becomes a household word in the area.

3.3 Financial Objectives

• Sales of more than half a million dollars in 2009 and more than $1 million by 2010.

• Gross margin higher than 80%.

• Contribution margin of approximately 50% of sales by the third year.

3.4 Target Markets

We have divided our market into two parts

I. Consumer market

Professionals and students fall into this segment. Professional need laptops in meeting
their professional needs. Students, specially the university students are highly attracted to
laptops. They need PC in their daily academic purposes and a laptop is much more
desired than a Desktop.

II. Business market

Corporate users and Entrepreneurs fall into this segment. In fact this is the biggest
segment of our market. Different IT solution providers, multinational business
organizations and other corporate users who provides laptops to its professionals are our
focus.

Entrepreneurs who needs to operate their business according to schedules another focus
of our concern.

3.5 Positioning

The sHv will position itself as an upscale laptop producer and accessories provider. Business
people of all types will use the sHv as a medum to hold meetings and catch-up on email
communications. Students from all types will use The sHv as a tool to socialize and discuss the
latest Internet sites.

We will also participate in major industry events, including different computer fairs and shows.
Our total budget for events is $40,000, plus about half of the $31,000 travel budget.

This year we will also promote our products with an in-house catalog including our own
products plus related merchandise of interest to the same target market.

3.6 Marketing Mix

The following sections outline the marketing mix for OSS Telecom Technology. OSS has
strategically built this marketing mix to compete effectively and promote a strong value
proposition in the marketplace.

3.6.2 Pricing

We will maintain our pricing position as a premier provider. We are the best product available,
for the most discriminating consumer. We intend to maintain our separation from the price
competition at the lower end of the business. Our plan calls for no significant changes in pricing.

3.6.3 Distribution

Our most important marketing distribution program is customer related. Chairman will be
responsible, with budget of $10000 and milestone date of the 15th of July. Achievement should
be measured by profit and customer satisfaction.

3.6.4 Communications
One of the best places to reach the target is the local newspaper. Some newspapers of
Bangladesh are very popular and we'll have to make sure that our message is excellently stated.

Radio is potentially a good opportunity. Our target buyers listen to local news, talk shows, and
sports. Sponsoring a technology discussion/call-in talk show is a possibility.

Seminars are a good marketing opportunity. Employees are often happy to leave their normal
routines for a day to learn something new.

3.7 Marketing Research

In 1998, a market survey was conducted to help evaluate the business viability prior to its
inception. The survey was a valuable resource for establishing pricing and market needs. We will
continue to conduct a survey of our customers and potential customers on an annual basis.
Survey results will be used to create new marketing programs and monitor the performance of
current marketing programs.

4.0 Financials, Budgets, and Forecasts

The marketing plan is built on these truths:

The marketing budget is based on a percentage of sales value. Currently, that value is set at 20%.

Building a strong brand and brand loyalty is critical to the success of the sHv.

Marketing is a critical component of the the sHv business plan.

The relationship between marketing dollars spent and revenues generated is positive only to a
certain point. We don't feel that a marketing budget based on 20% of sales is close to that point
where additional marketing dollars spent won't create additional revenue. If we can manage, we
plan to spend more than 20% of sales on marketing in future years. However, we want to keep
this relationship in mind as we consider spending more on marketing efforts.

Our understanding of the need for strong branding and emphasis on marketing gives us a
competitive edge over other cafes in our area and potential competitors.

4.1 Break-even Analysis

the sHv is operating in an industry capable of supporting high gross margins. Variable costs in
relationship to per-unit revenues are low. Variable costs are equal to roughly 25% of per-units
revenues. It is our hope that as we move into the future and continue to build relationships with
our suppliers, this value will decrease further, approaching a value of 20%.

Fixed costs for the sHv equal almost $7,500. Fixed costs include: payment of debt, facility lease
costs, hardware costs, and other costs the sHv must maintain on a monthly basis. These costs are
fixed and aren't impacted by an increase or a decrease in sales.

Currently, the sHv will break even at a monthly sales point of $10,000.

Monthly Units Break-even 2,986

Monthly Revenue Break-even $10,002

Assumptions:

Average Per-Unit Revenue $3.35

Average Per-Unit Variable Cost $0.84

Estimated Monthly Fixed Cost $7,500

4.2 Sales Forecast

Revenues for the first year of operation are based on an almost 10% growth rate from month to
month. This is an aggressive estimate, but we feel that our strong emphasis on marketing will
have positive results. Annually, beyond the first year of operations, we're predicting a growth
rate of roughly 10%. We'll have a better idea of potential growth rate beyond year one as we
make our way through our first year. The plan will be updated as we receive more information.

4.3 Expense Forecast

The marketing budget will consistently equal approximately 20% of sales. One of our strongest
strengths is our marketing and brand building capabilities, and the aggressive marketing budget
is a reflection of the importance we attribute to our marketing activities.

Currently, the marketing budget beyond year one remains set at 20% of sales. It is our hope to
increase this budget should sales and efficiencies of scale allow us to do so.

Explanation of Major Marketing Expenses:

• Local TV spots... In our first year of operations, we will spend $23,000 on TV spots. TV
spots allow us to reach a large audience and effectively target our market.
 • Print Materials... Print materials always require a significant budget. They include:
flyers, literature distributed internally, novelties for customers, coupons, and anything
else we can squeeze into this budget.

• Local Newspapers... An important part of our marketing efforts. Newspapers ads will
give us a vehicle for consistently getting our message/brand in front of a large number of
potential customers. We believe this vehicle will get our message to seniors, which make
up a large portion of our target market. In addition, the business section will provide us
with a means for communicating with our business customers.

• Local Radio Spots... These are an inexpensive way to secure a large number of daily
impressions.

• The sHv Events... This will include local radio and TV events where radio and TV
stations broadcast from the The sHv site offering freebies to first-time customers for
stopping by. The sHv will also run educational programs and community events
throughout the year.

• Customer Happiness Representative... This employee will monitor the level of

happiness amongst the sHv customers. They will be responsible for: developing customer
satisfaction programs, monitoring happiness levels, responding to customer concerns, and
the general well being of every the sHv customer.

4.4 Linking Sales and Expenses to Strategy

Our marketing expenses are tied directly to our sales revenue. As sales increase, the marketing
expenses will increase. Currently our marketing expenses equal roughly 20% of sales, and we
hope to increase that value in the future. Our programs will be monitored for efficiency and
return on investment. Most notably, we want to pay close attention to the value of the "Customer
Happiness Representative." This component of our marketing budget is expensive, and we want
to track the value of the program to make sure we're optimizing our budget. Periodically, we will
survey our customers to determine the effectiveness of our programs, and we'll adjust the
marketing mix appropriately based on our findings.
5.0 Controls

The sHv Digital Technologys’ controlling process is so strict that we are planning tight control
measure to closely monitor quality and customer service satisfaction. This will enable us to react
very quickly in correcting any problems that may occur. Other early warning signals that will be
monitored for signs of deviation from the plan include monthly sales and monthly expenses.

5.1 Marketing organization

Chief marketing officer of the sHv Digital Technology, holds overall responsibility of marketing
strategy and decision. The marketing organization of the sHv Laptop is as follows.

On the top of the management is the Chairman and all other managers of departments are under
him. The sub-departments are the Sales department, Advertising department, Promotion
department and the distribution department. All the departments work together to achieve the
organizational goal.

5.2 Contingency Planning

This marketing plan is just that, a plan. Plans don't always work out and we have to be ready to
deal with the likelihood that the sHv won't make good on the projections outlined in this plan.
We also have to prepare ourselves for overwhelming success.The following are some possible
scenarios:
Revenues exceed projections

A serious increase in revenues over projections will give us an opportunity to increase our
marketing budget above the allocated 20%. We'll be able to hire the marketing manager
earlier, and we'll be able to provide more equipment and possibly add an additional location.

Revenues miss projections

We have to be prepared for this possibility. If we miss our projections, we simply have to re-
double our marketing efforts. The danger in this scenario is that the first reaction to missed
projections is to decrease spending, particularly marketing expenses. We can't do that! We
have to get our message out to the target market, and we can't do that if we stop spending on
marketing. Additional capital infusions may become necessary and that possibility is detailed
in the business plan.