Golf Swing Analyzer Sample Presentation

7/27/2019 Golf Swing Analyzer Sample Presentation

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The Golf Swing Analyzer

Team 1Team members


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Agenda Background and Key Issues

Internal/External Analysis

Alternatives

Assessment and Recommendation

Implementation Plan

Contingency Plan

Conclusion


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Background

Chris Jenkins, Stan Uhm, and TalbotMcInnis are Engineering students atUniversity of Western

Chris and Stan are graduating, Talbothas one more year Project generated interest from the

media, investors, and entrepreneurs


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Background

Golf is a growing form of recreation(2.5% annual growth)

Approx. 21.5% of Canadians golf

Trio must decide on a course of

action quickly to protect idea and toearn income


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Key Issues

Technology Need to develop prototype into

marketable product

Expertise Need to ensure expertise in start-up is

in place

Risk Level of acceptable risk for group


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Key Issues

Value-chain proposition Is the product viable and sustainable?

Do consumers exist?

Start-up Capital How much financing is required.

Where will it be obtained?

Income How long will the partners be withoutincome? Will they need another job?How high is the potential income?


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Key IssuesImportance

UrgencyLow High

LowValue-ChainProposition Technology

HighStart-upcapital

ExpertiseRiskIncome


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Strengths Award-winning engineering project (Ontario and Canadian design competitions) Interest from media, articles in 2

local newspapers, and interest frominvestors and entrepreneurs No product in the market that

provides the same range of information as the Analyzer at anaffordable price


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Internal AnalysisDesign Features: records time and position,displays measurements, affordable, portable,could be used with or without a ball

Images may not reflect actual product.
http://www.thegolfsystem.com/index.htmhttp://www.thegolfsystem.com/index.htm


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Weaknesses

Engineering students with no bigcapital to invest in a business

Limited experience and connections Golf retail industry is highly

seasonal Need to obtain patent for Canadian

and U.S. jurisdictions Advanced features dependent on

computer


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Opportunities Golf is a growing sport Large number of core golfers Baby boomers are primary market

Leading sport brand for golf analyzer equipment Indoor golf training so that golf is no

longer seasonal Flexible technology with potential for

several uses based on software (ie.Simulator)


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Threats

Idea could be copied before it ispatent protected

Better funded competitors Rapid technological advancement Similar technologies exist

Patent litigation


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Porters 5 Forces MED cheap to develop new technology many technologies already patented

HIGH many alternatives

HIGH several similar products exist easily copied new technologies evolving

LOW individual component parts are cheapand abundant

HIGH numerous competitorsoffering wide variety of features and pricepoints for the consumer


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Estimated Golf Spending inCanada

2006 1998(estimated)

TOTAL $13 Billion $11.30 B

Fees/Membership $7.25 B $6.30 B

Equipment $2.25 B $1.96 B

Travel $1.73 B $1.50 BApparel $1.62 B $1.41 B

Source for Data: Ipsos Reid, The 2006 Golf Participation in Canada Report


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Golf Spending on Equipment

In the USA, approx. 12.5% of allgolf equipment and accessories isfor training purposes.

That means in 1998, Canadiansspent $240 Million on golf trainingequipment.


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Proportion of Golf Dollar Spending in Canada

57%

13%

13%

15%

2%17%

Green Fees Travel Apparel Equipment/Accessories Training Accessories


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Competition Analysis


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Alternatives

Try to develop and market the analyzer independently

Accept offers like Jack Lowes to help

grow a company License the analyzer technology to a firm

like Sports Simulations Inc. and collectroyalties only

License the analyzer technology to a firmlike Sports Simulations Inc. in exchangefor working for them too


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Do it independently

Pros Maintain control Largest share of

profits

Cons Very expensive Inexperienced Riskiest individual

venture Need to raise

capital No short-term

income


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Get partners

Pros Maintain most

control

Large share of profits

Attain some

expertise

Cons Very expensive Inexperienced Risky venture Need to raise

capital

No short-termincome


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License analyzer onlyPros Maintain ownership

of technology Minimal personal

cost Experienced

development team Financing is

irrelevant Can work elsewhereto get guaranteedincome

Cons Give up control Income dependent

on revenue Income timing relies

on product reachingmarket


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License analyzer & work

Pros Maintain ownership

of technology No personal cost

Experienceddevelopment team Guaranteed income Immediate income Financing is

irrelevant Familiar with

technology issues Help grow product

Cons Give up control Work for somebody

else

Minimize maximumincome potential Income dependent

on long-term viabilityof company where

technology resides Unknown scenariosfor leaving thecompany


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Criteria Income

Timeliness and magnitude of compensation Expertise

How much expertise is required or offered by

alternative Risk

How much risk must be shouldered by trio Financing

How financially stable is the alternative Technology

How familiar the alternative is with manufacturing andtroubleshooting the technology


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Decision MatrixCriteria Weight Go it

Alone

Find

Partners

License

Only

License

& Work

Income 0.25 1 1 3 3

Expertise 0.25 1 3 5 5

Risk 0.25 1 3 5 4

Financing 0.15 1 3 5 5

Technology 0.10 1 3 4 4

TOTAL 1.0 1.0 2.5 4.4 4.15

1 (unfavourable) to 5 (favourable)


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Decision

License the technology to a firmsuch as Sports Simulation Inc. or others for royalty fees.

Negotiate a 12 month contract withthe company to work/develop finalproduct or else seek employmentelsewhere.


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Implementation PlanDate Activity Responsible Cash

Flow

June 03 Hire a lawyer.Incorporate numbered company.Sign shareholders agreement.

Uhm, Jenkins,McInnis, Lawyer

($5000)

June 03 Raise capital from family and friends. Uhm, Jenkins,McInnis, Lawyer

$10,000

June 03 Write business plan and prepare a ProForma Statement

Uhm, Jenkins,McInnis

July 03 Seek SBL from bank. Uhm, Jenkins,

McInnis

$50,000

July 03 Identify a patent lawyer.Start Patent application process for USAand Canada.


($20,000)

July 03 Continue refining prototype for development of productionspecifications.

Uhm, Jenkins ($5,000)


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Implementation PlanDate Activity Responsible Cash

FlowJuly 03 Initiate formal bargaining process

between company and Sports SimulationInc.


($5000)

Aug 03 Conclude negotiations for patentlicensing with Sports Simulation Inc. Uhm, Jenkins,McInnis, Lawyer

Aug 03 Enter employment negotiations for Uhmand Jenkins with Sports Simulation Inc.

Uhm, Jenkins

Sep 03 McInnis is back to school. McInnis

Sep 03 Uhm and Jenkins start employmentsomewhere at Sports Simulation Inc.

Uhm, Jenkins

Feb 03 Final product to mass manufacture. Uhm, Jenkins


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Implementation Plan

Sources of Financing Family and Friends $10,000 SBL $50,000

Expenses Legal Fees $30,000 Hardware/Software $5000

Salaries $25,000


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Contingency Plan

If negotiations for employment areunsuccessful, Uhm and Jenkins willseek employment elsewhere

If unable to license patent, sellpatent entirely

Failure to find an immediate firm tolicense the patent to, newcompanies will be approached


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Conclusion

To minimize Risk and maximizepotential Income and productExpertise, the product should bepatented and licensed to a sportscompany familiar with thetechnology and the market.

QUESTIONS?


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Appendix


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7 Ps of Marketing

Product Price

Promotion Place Packaging

Positioning People


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American Golf EquipmentSpending

Golf Equipment and Accessories

1992 $2.9 Billion

2003 $9.6 Billion

Specialty and Training Equipment

1992 $400 Million

2002 $1.7 Billion


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Training Equipment Ratio

In 1992,0.4 B / (0.4 B + 2.9 B) = 12.12%

In 2002/2003,1.7 B / (1.7 B + 9.6 B) = 15.04%

Average is 13.58%. Use 12.50% to be conservative.


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Royalty Analysis


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Breakeven Analysis

Depending on the proportion of Labor and General expensesthat go directly into the pockets of the trio, they will need tosell between 3000 and 8000 units per year to earn $50,000each.


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Implied Value by Partner Jack Lowes offer of $10,000 for 5% implies he

thinks the company/idea is worth $200,000currently. This does not cover the costs of patents.

His initial services would be worth around$5000 but he wants 5%. This impliescompany/idea is worth $100,000 currently.

His desire for 5% for raising funds is notcontingent on the amount raised.

Contribution to day-to-day operations for 15% isreasonable. However, is he the right person?

Golf Swing Analyzer Sample Presentation

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