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Case Product description and target customer Development approach Production and sourcing approach Sales and marketing approach
IndEquip1 Low-cost frequency converter for middle-market Integrated: Development within Separated: Low-cost sourcing and Integrated: Same sales force and
manufacturers in China. premium R&D unit in Europe and production at an external local channels as premium business
China manufacturer model
IndEquip2 Low-cost SIR for middle-market customers in China. Integrated: Within premium R&D Separated: Low-cost sourcing and Integrated: Same sales force and
unit in Europe production in China channels as premium business
model
MachineFirm1 Low-cost rotary hammer for basic applications, Mixed : Co-development of premium Mixed : Low-cost sourcing and Integrated: Same sales force and
limited features, increased robustness, durability and low-cost R&D unit production in China where some channels as premium business
and ease of use for construction site operators in products for the premium BM are also model
emerging markets produced
LabEquip1 Low-cost, basic weighing scale, with reduced Mixed: Dedicated low-cost R&D unit Separated: Low-cost sourcing and Integrated: Same sales force and
feature set and increased ruggedness for in China with assistance from production in China channels as premium business
laboratories with limited budgets and gauging premium R&D in Europe model
accuracy needs
MachineFirm2 Low-cost, electronic discharging machine for Separated: Low-cost R&D unit in Mixed : Low-cost sourcing and Integrated: Same sales force and
middle-market customers, with adequate accuracy, China production in China where some channels as premium business
reduced feature set and high ease of use products for the premium BM are also model
produced
Medtech1 Low-cost CT scanner, high reliability, fast Separated: Low-cost R&D unit in Mixed :Low-cost sourcing and Integrated: Same sales force and
workflow, and high ease of use for clinics in China production in China with preassembled channels as premium business

smaller cities core components shipped from Europe model
MachineFirm3 Small, low-cost, energy efficient twisting machine Mixed: Dedicated low-cost R&D unit Separated: Low-cost sourcing and Separated: A separate sales team
with reduced but tailored feature set and high ease in China with assistance from production in China from the premium business model
of use for small textile producers in the middle premium R&D in Europe
market
Medtech2 Bedside monitors with simple and limited Separated: Low-cost R&D unit in Mixed : Low-cost sourcing and Separated: A separate sales team
functions, robust design, high reliability, ease of China production in China where some from the premium business model
use for small hospitals and clinics in smaller products for the premium BM are also
cities produced
LabEquip2 Low-cost, portable, rugged virus detection device Separated: Team of engineers Separated: Low-cost sourcing and Separated: A different channel
for rural regions sold to country governments dedicated to low-cost R&D and production in South East Asia. (NGOs) than with the premium
collaboration with external partners business model
MachineFirm4 Mobile, compact mill for decentralized processing Separated: Team of engineers Separated: Low-cost sourcing, Separated: A separate sales team
of agricultural products for small businesses, dedicated to low-cost R&D production and pre-assembling in from the premium business model
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nascent entrepreneurs, and communities China; shipping to South Africa for final
assembly
Medtech3 Portable, battery-based low-cost, ultrasound Separated: Low-cost R&D unit in Separated: Low-cost sourcing and Separated: A separate sales team
machine, for clinics and doctors in small cities China production in China from the premium business model
and remote rural areas

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Market segment served

by low-cost business model
BoP
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MachineFirm4
very poor
LabEquip2
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Medtech2
Middle market
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in tier 2&3 cities

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IndEquip1
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ToP Premium
Affluent business
model

low Degree of domain/value chain activity separation High

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Market segment served

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BoP
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very poor
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separation/exploration
2nd degree
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3
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1
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