Professional Documents
Culture Documents
INNOVATION MANAGEMENT
(MPU 3242)
NAME ID NUMBER
1. Ummi Syuhada Binti Ahmad Sukery 62213118479
2. Siti Nor Ashikin Binti Sahari 62213118261
3. Nurin Dania Binti Mohd Rahmad 62213118006
SUBMITTED TO:
PROF. DR. NAZIRUDDIN BIN ABDULLAH
TABLE OF CONTENT
Smart Home Tech is a new business which sells a smart plug that can control various
appliances at home through a smartphone from anywhere. For example, connect a lighting
fixture to a smart plug, and then you can use your smartphone or virtual assistant to turn the
lamp on and off. The main objective of this business is to give the best products to customers
that will fulfil their satisfaction. Besides that, we will try to achieve monthly profit target that
can help enhance our financial position.
Our shop will be located inside a mall in Setapak Central. Our target customers are
people with big families from age 30-55 years old. Therefore, there is a competition in the
same industry as Smart Home Tech. We plans to give the best products and services of our
company to the customers among our top competitors. The company will have one manager
and three workers to help on managing the shop.
Our pricing strategies will be based on the objectives to get reasonable profit and
ensure customers will keep on continue doing business with us in the future. Emphasis will
be on good services of selling the products that will not only meet, but also will exceed
customers’ expectation and satisfaction.
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2.0 BUSINESS DESCRIPTION
The smart plugs have a Wi-Fi chip that speaks to your router and home network. To set them
up, you need to download a smartphone app which connects the plug to your Wi-Fi controls
which switching the plug on and off. You can also set timers in the app, and connect the plug
to an Amazon Echo or Google Home smart speaker. This smart plugs also have a physical on
and off switch on them, which means they can be controlled without your phone or voice.
These cheap products are easy to set up and install, and are the ideal starting point to make
your home smarter. They are also renter-friendly, since they do not need installation and when
you leave, they can easily be unplugged and taken along with you.
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2.2 Industry background
SMART
HOME
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2.3 Goals and potential of the business and milestones
Our main goal is to give the best product to the customers that will help their house chore
easier and meet their satisfaction. Besides that, we want to achieve the target sales to increase
consumer awareness about our company.
Once the business has well established, we are planning to open a new branches to expand
our product in other places around the world and become a large and well-known company.
We will improve and upgrade our services and quality of our product in this business. In
order to provide better quality of products in our business, we will monitor the manufacturing
process occasionally. In conclusion, we believe that our business has a good future prospect
by fulfilling the need and wants of customers.
A smart plug is like a power adapter, it fits in between your power socket and the appliances
you want to attach to. It is simply turning stuff on and off at the most basic level. But this
becomes a very nifty product when connected to a smart home network.
The uniqueness of the product is that they let you control your appliances from an app on
your phone from anywhere. Even the apps allow you to set schedules for your smart plugs, so
you can turn on and off appliances at certain times and on particular days. Other than that,
smart plugs also can give information of how much energy the appliances connected used. It
is an extremely useful feature for the energy-conscious consumer.
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3.0 MARKERTING
The target market of Smart Home Tech is comprised of a married couples and those who
have a big family, and we focus on people who live in Setapak area. The reason why we
focus on people who live in Setapak is because there are many big and luxurious houses
or condominiums there that we think is full of appliances and our product will help them
solve the problem.
Shah Alam
Pulau Pinang
Melaka
Johor Bahru
Singapore
3.1.3 Competitors
It is so important for Smart Home Tech to identify our competitors. Competitors refer to
other business that offer similar to our product or services. Based on a market survey
done earlier, we have found out that there are three closest competitors for our business.
Table 1.0 shows the strengths and weakness of our competitors.
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Competitors Strength Weakness
Wemo Wi-Fi Smart Has a physical control Not compatible with 5Ghz
Plug button Wi-Fi
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3.2 Marketing Plan
Smart Home sales strategy is we want to maximize our sales and our product can be
utilize at least 55% from our target market. To achieve that, we will introduce our product
to those who have a big family, and those who lived in Setapak area. Besides, we will
give 1 years of warranty if any problem happens to the products so that our customer
would never regret to purchase the smart plugs from us. Furthermore, once a customer
will always be our customer. We will give our best services to them. We also need to
focus on keeping a strong relationship with our customers because we want to get their
trust on our product and business as well. In addition, we will conduct a SWOT analysis
to recognize our strengths, weakness, opportunity and threat to keep improve our product.
Strengths Weakness
Safe to use with approval from Unwell known company
SIRIM
Have a cheaper price
Opportunity Threat
Easy to purchase from: Have lot of competitors in the
Website current market
Online
Store
As our business is still new in the market, we have to do vigorous marketing like
distribution strategy. First, we use direct distribution by using e-commerce website where
our future customers can make a purchase through online. Another direct distribution
method that we use is through phone orders and our customers can pay by cash on
delivery. It is to ensure the product that they have purchased is safe and in a good
condition before they receive and pay. But, we also offer a postage service to the
customer that have purchased our product from a different state. We are using DHL
services as our main courier and currently has planning to create our own delivery team.
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Besides, we also have choose a selective distribution which is we will distribute our
products to trusted electronic retailers such as Courts Malaysia, Senheng and Harvey
Norman. This method hinges on making a large number of goods available in selected
locations. This can help craft an implicit high-end brand message while also increasing
the opportunity for shoppers to purchase one of our products. We would like to expand
our business in more states. Next, we will be using exclusive distribution which is our
business have own store that sells the smart plugs directly to the customers.
3.2.2 Pricing
Price is very important to state as it may influence consumer to purchase and it also give
competitive advantage to the competitors. Price is very important to the company and also
the customer. Smart Home’s product looks exclusive and customer can buy it with
affordable price. Although it can get an affordable price, it is still secured in the same
time.
Our pricing strategy for this product is refers to method that our companies used to price
our products. Almost all companies, large or small, using the same method based the
price of their products and services on production, labour and advertising expenses and
then add on a certain percentage so we can make a profit.
Besides, our pricing method is based on competitors based pricing. We setting our price
very close to a competitor’s prices signals to the consumers that the product is similar but
a bit cheaper with a better quality or some other valued benefit. Our price is only for
RM35 while competitor’s price have reached more than RM40 with no approval by
SIRIM.
Furthermore, our product price also based on RRP price as smart plug industry have price
protection that all the retailer are restricted to follow the price. Thus, it is viable to say
that we are follow competitive based on pricing strategy. What special about our price
that we offered is because the price is included with the application for every customer
who have purchased our smart plugs. The user only have to download the application for
free through App Store (IOS) or Play Store (Android).
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3.2.3 Advertising and Promotion
As for our promotion strategy, Smart Home uses the advertising method as the first step
in promoting our business. We use variety types of the promotion tools like social media
(Instagram, Facebook, Twitter, etc.) and also mass media such as television like CJ Wow
Shop and Go Shop, radio, magazines, newspapers and many others to promote our
product.
There will be flyers that will be distributed and a business card from the General
Manager, Financial Manager, Marketing Manager, Operation Manager and
Administrative will be given to any potential customers. The marketing manager will be
appointed to carry out promotion strategy extensively. Flyers or brochures will be given
out every time we are doing our promotion on our service. Usually the time that we
distribute our flyers/brochures to our customer is during selected time such as school
holidays, festive seasons and semester break. Flyers/Brochures is one of the interesting
way to promote our product since we can decorate it with cheerful colours, pictures
related to our product and it will attract our potential customers.
Other than advertised our product we also build a public relation with other company
such as ZetaPark Development Sdn Bhd. By building a public relations our company can
obtaining favourable publicity, building a good corporate image and handling or heading
off unfavourable rumours, stories or events. Our company also join a trade show which
we can introduced by face-to-face to the customers.
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4.0 OPERATION
Our main business location is located in Setapak, Kuala Lumpur. We have identified
to run our business in Setapak Central Mall, Lot No. S-20, 2 nd floor, No. 67, Jalan Taman Ibu
Kota, Wilayah Persekutuan, Kuala Lumpur.
4.1.1 Advantages
A good location is important to the success of a business. For our business, the
advantages to opening a store in a busy area is include improved revenue and increased
marketing exposure. So, the first advantages of our business location are it is very
strategic and near with the community since it near with residential area. So it can attract
lots of customers from the city. Our business operation is in the shopping mall so it will
be easy for our customer to know about our product and also easy to come and purchase
our product from our store. Besides, it is convenient to access parking in the shopping
mall area. The parking charges also very affordable and flat rate which is only RM1 per
entry.
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Besides, the benefit of being in a busy area is the availability of a significant amount of
foot traffic. So, if we advertise pricing specials and put a sign in the window, it can easy
grab the attention of the people walking by. The large amount of foot traffic in a busy area
offers a ready-made customer base that will decide to enter our store out of curiosity at
first, but then eventually become longtime customers.
4.1.2 Zoning
Our business located in the North of Kuala Lumpur. We have followed the local
governments to use the right zoning to open our business in order to protect the health and
safety of a community and a regulate growth. So, our business location is a commercial
zoning. A parking also have been provided at our business area in order to avoid
commercial zoning trouble.
4.1.3 Taxes
Since our business is at an urban area and the premise in owned by private company, the
rent is a bit higher rather than the government building. Expenses for the rent cost about
RM3, 000 per month including 2% of taxes but it is not include with other expenses such
as security system and hiring guard. The total of other expenses are around RM5, 000.
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4.2 Approximately to Suppliers
Smart Home Tech Sdn Bhd involved in the smart plug industry which we believe that the
company can be develop due to the higher demand. To ensure our customer satisfaction, a
good product and services will be providing from our company with the selected good
supplier and investor. Below is the list of supplier that have supply raw materials to us.
Smart Home Tech Sdn Bhd has produced the product by purchased raw materials from China,
India and some of it we also purchased from local. To produce the devices we transformed
from the physical change of raw materials into the product. Machine and equipment that we
have in our operation are to operate the raw materials that we purchased from supplier and we
plug it in or produced as our product. It means that we do not produced our own materials.
Our manpower have skills and enough experienced that work in our operations. Below are
financial and capital requirement:
Besides, our location is very important because it effects on our suppliers. In order for our
product-based business to flourish and shine, our suppliers are light source and necessity. Our
location is easy to access for the local supplier. For the import supplier, the raw materials will
come through the cargo from the KLIA which is quite near with our location.
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4.3 Access to Transportation
The access to transportation to our business is easy. Even though there will be a traffic jam in
the morning but our operation hour will be start from 10am which is our customer can avoid
the traffic jam to go to our location. Since we located in shopping mall in the city, so, our
customer can stop by when they go to shopping. Our business location is easy for the
customer to come and drop by because the location are located at the centre of city. Our
customer can use public transportation to go to our store by LRT, Bus and etc. If our customer
want to use LRT, they have to stop at Wangsa Maju LRT Station. Next, they can take public
bus which is RapidKL bus 250, 220 or T250. In addition, they also may use another option by
booking a Grab, MyCar or another choice that they would like to use to stop by near our
location at Setapak Central.
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5.0 MANAGEMENT
Chief Executive
Officer (CEO)
Administrative
Accounting &
Marketing Operation
Finance
Manager Manager
Manager
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Management Team Background
ADMINISTRATIVE
EMAIL insyirahmad@gmail.com
STATUS Single
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ACCOUNTING AND FINANCE MANAGER
EMAIL alisaalia@gmail.com
STATUS Married
Approachable
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MARKETING MANAGER
EMAIL afiq89@gmail.com
STATUS Single
Adaptability
Commercial awareness
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OPERATION MANAGER
EMAIL nazmiirfan@gmail.com
STATUS Single
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5.2 Financial Plan
A financial position is important for the overall success of Smart Hope Shop because it helps
to:
Administrative expenditure
RM RM
Fixed assets/capital expenditure
Cash in hand and bank 100,000
Working capital/monthly expenditure
Allowance 4,500
Worker’s salaries 10,000
EPF 1,738
SOCSO 31.60
Office supplies 2,200
Rental and license 2,000
Water bill 200
Electricity bill 800
21,469.60
Other expenditure
Promotion and marketing 370 370
Total 21,839.60
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Project implementation cost & sources of finance
Project implementation cost Suggested sources of financing
Requirements Cost Loan Hire Own contribution
purchase cash Existin
g assets
Fixed assets 100,000
CCTV,Printer,Storage, 20,600
Recycling Tools
Furniture 15,000 5,000
Air conditioner 800 2,400
Sign board 100
Total 43,900
Total 66,109.60
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SMART HOME TECH
PRO FORMA STATEMENT OF PROFIT OR LOSS FOR THE FIRST YEAR
Sales 70,000
Less: cost of goods sold
Opening stock -
Purchases 42,840
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5.3 Legal Structure
Our business is a limited liability company which is sole partner with Ummi Syuhada, Siti
Nor Ashikin and Nurin Dania. Since the limited liability is a business entity, so the business
owners with the liability protection that corporations enjoy without the double taxation.
Earnings and losses pass through to the owners and are included on their personal tax returns.
Our business is governed by Companies Commission of Malaysia and Registration of
Business Act 1956.
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6.0 BUSINESS RISK ASSESSMENT
Maintaining a business could be perilous with a wide range of hazard. Therefore, a business
plan should contain some assumptions about these factors.
Product risk is the risk that the product can’t be created. It is because of our product
is based on the supplier or manufacturer and seal in the box. Thus any defect
regarding the product cannot be detecting before it was sell to the consumer. It is
because if the product has been cut seal meaning the products counted as sold
Market risk is the risk that the market will develop differently than expected.
Sometimes markets take too long to develop, and cash runs out while a company is
waiting for customers. Maybe it also can happen towards our company even the
demand is higher recently. It is not too sure if we open one more retail store the
market demand is just like the same. It is also depending on the economic
performance of our country, it its good the purchasing power of consumer will be
high.
Expensive purchasing could a problem as the company need to pay high price to the
supplier to purchase the stock. Usually the stock that ordered are based on the
demand. But then our company are intending to have a safety stock as to ensure there
are no shortage of consumer demand of the product at that time.
Uncertain Sales
As we know the sales towards purchasing smart home tech by the consumer are
uncertain regarding their purchasing power. The conversion rate is the percentage of
people who buyout of the total population of people you approach. It is also known
as hit target sales. The best test of the conversion rate is through test marketing or
pre- selling. Test marketing is selling your product or service in a limited area, for a
limited time.
Financial risk
It is the risk that a company will run out of money or mismanage the money in some
way (Robbins, 2014). The company will do investment and could be facing financial
risk. For example, investing large amount of money to purchase new technology to
speed up the process. By that, the company need to be aware if there are some
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problem that might happen such as Covid-19 that happened to our country right now
as example.
Competitive risk
It is the risk that a competing product or service will be able to win. Many web-based
businesses have high competitive risk since they can be started with little money and
have no way of locking in customers (Robbins, 2014).
The company shall be held liable if not following the labour law by giving minimum
wage of RM1200 for an employee in Malaysia.
Unfair dismissal due to discrimination by act of misconduct may cause the company
to be fine and deter other workers as well and affect the company’s image and
reputation.
There are several ways to eliminate the problems. The actions are:
Conduct a meeting with management towards the improvement regarding the sales
promotion and financial for have a stable company.
Provide a key performance indicator (KPI) towards the business and also the
employees to ensure the manage to achieved it or not
Adhere to the labour law: Employment Act 1955, Employees Social Security Act
1969, and Employees Provident Act 1952.
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6.4 Suggest Innovative Improvement for Smart Home Tech
Improve your home network connectivity. A smart plug can turn any of your
existing appliances and electrical devices into smart objects that can communicate
with other smart products in your home.
Turn appliances on and off remotely. Using the plug’s app, you can turn appliances
on and off remotely and even check to see if you left an appliance running after
you’ve left your home.
Monitor your energy use from anywhere in the world. You can monitor how much
energy you’re using directly from your smartphone. Smart plugs will even notify you
if a device suddenly starts using unusual amounts of energy. How much do your
electrical appliances cost to run? One of the big draws about smart plugs is the ability
to connect them to smart meters. These devices can tell what is in use, and how often
they're active. Smart meters can measure how much it costs to recharge a phone,
tablet, or laptop. You can use this information to judge your electricity bill and choose
a potentially more efficient device in the future! And speaking of saving money with a
smart product, you might want to consider investing in one of these smart sprinkler
systems.
Manage your energy use with easy scheduling. By creating scenes for your
appliances, you can schedule when devices should shut down or start up. For
example, you can use a scene as a smart home routine for children by only letting
them use gaming consoles and televisions at certain times of day.
Eliminate vampire draw from your house. One of the best things to use smart plugs
for is controlling “vampire draw.” Vampire draw, or phantom load, is the energy your
devices suck up even when they’re not in use. Smart plugs can help you identify
devices guilty of phantom load so you can save on your energy usage.
Appear at home while you’re away. Burglars often target homes by watching for
signs that a home is empty. Smart plugs can be used to improve home security by
turning lights and appliances on and off while you’re on vacation, making smart plugs
a safe and effective way to look like you’re home while you’re away.
Control your devices with voice commands. One of the best smart plug uses is the
ability to turn on hard-to-reach devices remotely. Smart plugs are among the many
devices that work with Amazon Echo, Google Home and other smart hubs, so you can
operate connected appliances by voice command.
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Keep your home safe with smart plug temperature control. Are smart plugs safe to
use, or will they cause wall sockets to overheat in homes with older wiring? The plugs
themselves won’t increase the chance of overheating, and some smart plug models
even monitor wall socket temperatures and will send you an alert if it gets too hot.
You can even have the smart plug turn off the appliances automatically to decrease the
risk of electrical fires.
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Conclusion
As a conclusion, while several smart home enhancements are available on the market
today, few are as clear and simple as the smart plug. Smart plugs are an important aspect of
every home automation scheme when it comes to comfort and energy-efficiency. And you can
get the best of all worlds with the PowerPlug a lightweight, portable smart socket, and a
control centre, all in one. But if you want to start with a basic smart plug or go all-in with a
complete smart home system, you'll be able to monitor the multiple electronic gadgets in your
home while reducing your energy consumption. For so little expense or effort these devices
have too much power and comfort. When you perform your research to decide which is the
right smart plug for you, bear in mind spatial restrictions such as the height, depth and other
potential for outlet blockage, Wi-Fi connectivity, thermal sensitivity, acceptable indoor /
outdoor use, ease of use of the software, and connectivity with other smart home systems.
Smart plug also has remote access to monitor devices attached to the Smart Plug
anywhere you have the Internet using the smartphone's free and download apps from Apps
Store and Play Store. Hence smart plug can be scheduling the Smart Plug for automatically
flipping on and off devices as required, such as setting lights in the dusk or turning off at
sunrise. Moreover, smart plug also has away mode, switches on and off your computers at
random intervals to give you the illusion of being home. This is a perfect first step towards
smart home automation, or a basic and budget-friendly upgrade to the current smart home
device.
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