Strategic Marketing Plan
Evonth
SampleGroupAssignment-EcoBus.pdf
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Table of Contents
EXECUTIVE SUMMARY ...................................................................................................... 6
1. Introduction ......................................................................................................................... 7
1.1 Company Profile ............................................................................................................... 7
2. The ECO Bus Project ........................................................................................................... 7
2.1 Mission ............................................................................................................................. 9
2.1.1 Positioning Statement .................................................................................................... 9
2.1.2 Value Proposition .......................................................................................................... 9
2.1.3 SMART Objectives ....................................................................................................... 9
3. Market Analysis .................................................................................................................... 9
3.1 Target Market Segmentation .......................................................................................... 10
3.2 Size and Potential of Target Market ............................................................................... 11
3.3 Challenges Faced by Target Market ............................................................................... 11
3.4 Unmet Needs of Target Market ...................................................................................... 12
4. Macro-Environment Trends supporting ECO Bus ......................................................... 12
4.1 Demographic / Population characteristics Environment ................................................ 12
4.2 Economic Environment .................................................................................................. 12
4.3 Socio-cultural Environment ............................................................................................ 12
4.4 Technological Environment ........................................................................................... 13
4.5 Ecological or Natural Environment ................................................................................ 13
4.6 Political and Regulatory Environment ........................................................................... 14
5. SWOT Analysis .................................................................................................................. 15
3.6.1 Opportunities ............................................................................................................... 15
3.6.1.1 Potential for New Markets .................................................................................... 15
3.6.1.2 Government grants and venture capitals ............................................................... 16
3.6.2 Threats ......................................................................................................................... 16
3.6.2.1 Copycat Products .................................................................................................. 16
3.6.2.2 Increased cost of raw materials ............................................................................. 16
3.6.2.3 Competition ........................................................................................................... 17
3.6.2.4 Technological hindrance and Safety ..................................................................... 17
3.6.2.5 Government Regulations ...................................................................................... 17
4. Competitor Assessment ...................................................................................................... 17
4.1 Industry Business Description ........................................................................................ 17
4.2 Porter’s Five Forces Analysis ......................................................................................... 18
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4.2.1 Threat from new entrants ......................................................................................... 18
4.2.2 Bargaining power of customers ............................................................................... 18
4.2.3 Bargaining power of suppliers ................................................................................. 18
4.2.4 Threat of substitutes ................................................................................................. 20
4.2.5 Intensity of Rivalry .................................................................................................. 20
4.3 Conclusion on Porter’s Five Forces................................................................................ 20
4.4 Critical Success Factors .................................................................................................. 20
4.4.1 Industry CSF ............................................................................................................ 21
4.4.3 Environmental CSF .................................................................................................. 21
4.4.4 Temporal CSF .......................................................................................................... 21
4.4.5 Managerial CFS ....................................................................................................... 21
4.5 Current Market Conditions ............................................................................................. 21
4.6 SWOT Analysis ................................................................................................................ 22
4.6.1 Strengths ...................................................................................................................... 22
4.6.1.1 Reputation for innovation ..................................................................................... 22
4.6.1.2 Fast charging technology ...................................................................................... 22
4.6.1.3 Longer Distance Coverage .................................................................................... 22
4.6.2 Weaknesses .................................................................................................................. 22
4.6.2.1 Slow diffusion rate translates higher cost structure .............................................. 22
4.6.2.2 High cost in R&D ................................................................................................. 22
4.6.2.3 High Loan Rates ................................................................................................... 23
5. Marketing Strategy ............................................................................................................ 23
5.1 Marketing Objectives ..................................................................................................... 23
5.2 Overall Marketing Strategy ............................................................................................ 23
5.3 Brand .............................................................................................................................. 24
5.4 Product Positioning......................................................................................................... 24
5.5 Product Decisions ........................................................................................................... 24
5.5.1 Core Product ............................................................................................................ 24
5.5.2 Actual Product ......................................................................................................... 25
5.5.3 Augmented Product ................................................................................................. 25
5.6 Pricing Decisions ............................................................................................................ 25
5.6.1 Pricing Objective ..................................................................................................... 25
5.6.2 Pricing Strategy ........................................................................................................ 25
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5.7 Distribution Decisions .................................................................................................... 28
5.7.1 Exclusive Distributor and Wholesale ....................................................................... 28
5.7.2 Internet in Distribution Channel .............................................................................. 28
5.7.3 Sales Force ............................................................................................................... 28
5.8 Promotional Strategies .................................................................................................... 28
5.9 Advertising ..................................................................................................................... 29
5.9.1 Copy Platform .......................................................................................................... 29
5.9.2 Product Characteristics ............................................................................................ 29
5.9.3 Target Market ........................................................................................................... 30
5.9.4 Competition .............................................................................................................. 30
5.9.5 Statement of benefits ................................................................................................ 30
5.10 Personal Selling Plan .................................................................................................... 30
5.11 Trade Promotion Plan ................................................................................................... 30
5.12 Public Relation Plan ..................................................................................................... 30
5.13 Social Media Platforms ................................................................................................ 30
5.14 Website ......................................................................................................................... 31
6. Forecast and Budget ........................................................................................................... 31
6.1.1 Establishment Cost for Assembly plant and office ..................................................... 31
6.1.2 Cost of Goods Sold ...................................................................................................... 31
6.1.3 Operating Expenses ..................................................................................................... 31
6.1.3.1 Assembly Plant and related Expenses ................................................................... 31
6.1.3.2 Market Research Budget ....................................................................................... 32
6.1.3.3 Product Development Budget ............................................................................... 32
6.1.3.4 Media and Communications Budget ..................................................................... 32
7. Implementation and Control ............................................................................................. 40
7.1 Organisational Chart ....................................................................................................... 40
7.2 Information / Operational Control Dashboards .............................................................. 40
7.2.1 Digital Marketing Dashboard .................................................................................. 40
7.2.2 Marketing Performance Dashboard ......................................................................... 41
8. Contingency Plan ................................................................................................................ 42
8.1 Revenue exceeds projection ........................................................................................... 42
8.2 Revenue fall short from projection ................................................................................. 42
8.3 Failure to secure a major contract deal ....................................................................... 42
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8.4 Product Failure ............................................................................................................... 42
8.5 Financial Risks ............................................................................................................... 42
8.6 Threat of entry by competitors with similar product ...................................................... 42
9. Group Activity Records ..................................................................................................... 43
10. Appendices ........................................................................................................................ 45
ECO Transport Company Logo and Tagline ........................................................................ 45
ECO Transport Facebook Business Page ............................................................................. 45
Sensor based solar panels on bus roof .................................................................................. 46
Concept Bus .......................................................................................................................... 48
ECO Transport Corporate Site ............................................................................................. 49
11. References ......................................................................................................................... 51
12. UKRUND Report ............................................................................................................. 62
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EXECUTIVE SUMMARY
Built on a revenue agreement and a technology transfer sharing agreement between Proterra
Inc., an electric bus manufacturer with a strong presence in the United States and tapping on
the expertise of Tum Create, ECO Transport (S) Pte Ltd or ECO Transport for short is
Singapore’s first manufacturer of solar-electric bus. The company aims to harness
alternative energy sources to power electric vehicles and introduce the ECO Bus to the
Singapore transportation market.
Firstly, this report aims to analyse the Singapore bus market so as to identify the potential,
challenges and unmet needs of the market. Based on this, ECO Transport identifies its target
market that is divided between the public transit market and the private bus sector. The firm
identifies the Land Transport Authority (LTA) as a major key account and instrumental to
gain access to the public bus sector. Furthermore, the macro environment factors that support
the ECO Bus are discussed in-dept. This is followed with a SWOT analysis to identify the
firm’s strengths, weaknesses, opportunities and threats. Thereafter, competitors are assessed
with Porter’s Five Forces analysis to determine how favourable it is to penetrate the target
market. To facilitate the above, critical success factors are also identified to ensure the
survival of the firm together with current market conditions.
Next, the heart of the discussion centres on the overall marketing strategy for the ECO Bus
which is examined with the marketing mix and budget set aside, followed by a three years
sales forecast and a profit and loss analysis. In relation to the above, it is recommended that
the ECO Bus adopts a price skimming strategy based on the willingness to pay for the
vehicle. Implementation and controls are examined with the organisational chart and proposed
operational dashboards to monitor key marketing functions.
Finally, contingencies are discussed with the appropriate course of actions should such events
occur.
Comment [J1]: Not enough of “selling” in the ES
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1. Introduction
1.1 Company Profile
Established in 2016, ECO Transport (S) Pte Ltd or ECO Transport in short is Singapore’s first
manufacturer of full electric buses that harness both solar and kinetic energy. The company is
established as part of a partnership agreement with Tum Create, the original creators of EVA,
Singapore’s first electric taxi built for tropical region and Proterra Inc, a US based electric
bus manufacturer. The company’s core values are quality, environmental care and
commitment to the markets it serves. ECO Transport is committed to achieving zero carbon
emission in its products through strong emphasis in research, developments and innovations.
2. The ECO Bus Project
In joint partnership with Tum Create, original creators of EVA, Singapore’s first electric taxi
built for tropical region and Proterra Inc., ECO Transport aims to bring the best of industrial
knowhow to establish the ECO Bus. Riding on Proterra’s open source battery technology
and proprietary regenerative braking system or ProDrive System, ECO Transport sees
strategic fit in partnering with Proterra to proliferate electric buses in this part of the world
while working with Tum Create would allow additional local technical inputs (Lambert 2016;
EVA by TUM CREATE Electric Taxi for Tropical Megacities 2013; Piellisch 2016). A profit
sharing scheme based on 80/20 will be in place with Proterra to tap into its regenerative
braking technology which can conserves up to 92% of kinetic energy and convert into
electrical power (Hanley, 2016).
Built on dual powers based on solar and
kinetic energy, the ECO Bus is a self-
sustainable vehicle. Modelled after
Proterra’s battery electric bus, the ECO
Bus combines Proterra’s fast charging
battery and regenerative technologies
with a new modification that uses
photovoltaic panels installed on the bus
roof to harness the power of the sun. The
bus will also be equipped with Toshiba’s
SCiB fast charging lithium-titanate
batteries (Toshiba to provide rapid
recharge SCiB batteries for Proterra
Zero-emission bus fleet 2014; Vance
2014; Figure 1).
While solar powered bus is not a
completely new concept, given its debut
in Tibet, the use of advanced technologies and major enhancement such as sensor based solar
panels that automatically reposition for maximum sunlight exposure and thereby reduced
charging time is an all new combination (First solar powered public bus operates in Tibet
2015; Figure 2; Figure 3).
Other concepts of solar powered vehicles include Tindo. Technically, the bus is not solar
powered as it does not consist of panels on its roof. Instead, solar panels installed at the bus
interchange is used to generate electricity and charged to the bus (Tindo The World’s First
Figure 1: U.S. Patent 9,352,658 , Proterra's Fast Charging technology of Electric Vehicles Patent, US Patent and Trademark Office
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Solar Electric Bus 2013; Solartaxi Zebra Battery 2016; Nissan Leaf Electric Cat Battery
2016).
Instead, at the rooftop rear, the ECO bus features a
contact point that supports fast charging within
minutes for possible future integration with solar
powered charging depots, bus stops or bus
interchanges (Electric Bus Energy, Rechargeable
Publc Transit Solutions 2016; Proterra EcoRide
Eletric Bus How Does it charge 2013; Figure 1). In
addition, the ECO bus includes circuit boards and
dynamos installed onto the wheels, that uses
regenerative braking based on Proterra’s ProDrive
System that allow conversion of the bus movement
motion or kinetic energy into electricity which is
then stored back into the batteries on board the bus.
The ECO bus chassis is also made of composite
material, making it durable yet lighter than the
conventional steel exterior (Proterra The Bus Body
2016; Bus Type 2016). Hence, the lifespan of the
ECO Bus is expected to be much longer than the
typical diesel bus.
Without a combustion engine, journeys on the ECO
bus will be quieter and pleasant. The ECO Bus will
be available as a 40 foot bus targeted at both the
public and private bus sectors.
Figure 2: Solar powered bus in Tibet, Chinadaily.co.cn
Figure 3: Solar powered bus in Tibet, Chinadaily.co.cn
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2.1 Mission
ECO Transport’s mission is to be the market leader in providing high quality, clean and
sustainable transport solutions to meet service operator needs through product innovation and
technologies.
2.1.1 Positioning Statement For transport operators, ECO Bus is the solar electric vehicle that offers the best cost
efficiency in running a bus fleet.
2.1.2 Value Proposition ECO Bus is built to offer public and private bus operators the best fuel economy and low
maintenance cost in the long run with 21% of cost savings over conventional diesel buses.
2.1.3 SMART Objectives
In order to achieve the long term goal as set forth in ECO Transport’s mission statement, the
SMART objectives based on specific, measurable, attainable, relevant and time-bound criteria
are established to ensure project management and employees are aligned with the company’s
mission.
The company aims to acquire 2% of the overall bus supplier market share by delivering 200
ECO buses within Singapore by November 2019. The ECO Bus, a 40 foot prototype will
undergo a full 11 months of research, planning, product development and prototyping before
a month trial on the road. The ECO Bus will officially be launched in End October 2017.
In order to meet the timeline, industrial expertise are in place with most raw material parts
outsourced and manufactured overseas with final assembly completed in Singapore. By the
end of October 2018, ECO Transport aims to deliver 100 of ECO buses to the Land Transport
Authority of Singapore (LTA), and fulfil an additional 100 orders by November 2019.
By December 2020, ECO Transport aims to increase the cost efficiency of the production by
10%. This would be sustained with better supplier trade negotiations on parts and components
for the ECO Bus which will translate into lower acquisition costs to bus procurers as
economies of scale is achieved.
By end of 2022, ECO Transport will penetrate the Asia Pacific region with the aim to capture
5% of the APAC bus supplier market, particularly Hong Kong and Tokyo where demand for
public transit services is high (Key Transport Statistics of World Cities 2012). Consecutively,
ECO Transport aims to enter Greater China from 2022.
In addition, ECO Transport aims to develop a second
variant, a 22 foot ECO Bus in 2023 to launch within 2 years
to capture the private bus sector more efficiently.
3. Market Analysis
In this section, the overall market is analysed in-depth,
segmented and the target audience is identified. This is
followed by a SWOT analysis focusing on the strengths and
weaknesses of the ECO Bus.
Figure 4: Average daily ridership, Land Transport Authority
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3.1 Target Market Segmentation
The bus market can be divided into two main sectors, namely, the public bus operators and
the private bus operators. Up till early January 2016, the public bus sector operated on a
duopoly with SBS Transit Limited holding (SBS Transit) 73% and SMRT Corporation
(SMRT) at 26% of market share respectively (Bus Services 2016; PTC Annual Report 2015;
Figure 5).
Figure 5: Bus Operators' Market Share, PTC
SBS Transit operates the largest bus fleet in Singapore at 3,400 while SMRT operates 1,400
buses (SMRT Bus Fleet 2016, Bus Services 2016). Since the second half of 2014, the
government has opened the public bus market to other bus operators. These include new
comers such as Tower Transit and Go-Ahead Singapore in order to improve service efficiency
and competition where public buses continue to be the main mode of transportation in
Singapore with ridership increased to 3.7% or 3,891,000 passenger trips (Thakur 2014; Tan
2016; Tower Transit Singapore 2016; Go-Ahead Singapore 2016; Bus Operators 2016; Figure
4). However, since 2012, with the introduction of the bus service enhancement programme
(BSEP) to improve bus timings and subsequent transition to a contracting model, this would
mean the procurement of public buses is gradually coming under the direct purview of one
single authority, the Land Transport Authority (LTA), while bus operators are contracted to
run the bus routes (Cheong and Loh, 2015, 26).
Meanwhile, the private bus sector consists of over 1800 small and mid-sized bus operators
with an overall fleet of 5000 buses catering to the needs of chartered transport for schools,
factories, government agencies and organisations (SSPHBOA 2016; Company Profile 2016).
Among these, the largest private operator is Woodlands Transport with a fleet of 1300 and 42
years of experience in the market
(Woodlands Transport 2016).
According to Simkin (2008, 363), in
industrial market segmentation, it is
important to identify the needs and
recognise differences between different
business clientele. Hence it is suggested
to group companies based on
‘firmographics’ such as having
common physical attribute by
geography, size and industry. By
employing industrial market Figure 6: Singapore Bus Market, Land Transport Authority, Singapore School & Private Hire Bus Owners Association
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segmentation, specifically macro segmentation, based on the business size and years in the
market, the LTA which oversees the procurement of buses on behalf of the public bus
operators is the ECO Bus main target audience followed by Woodlands Transport.
3.2 Size and Potential of Target Market
Based on the above information, the Singapore bus market is about 50-50 split between public
and private operators with almost 10,000 buses in service (Figure 6). In addition, further
data by Singstat (2016, 20) placed the bus population at 18,183 with an average growth of 5%
between 2010 and 2015 (Singapore in Figures 2016; Figure 7). This trend is also in line with
Singapore’s population growth from 5.08 million in 2010 and ending with 5.54 million in
2015, an increase of 8% (Singapore Population 2016). By 2020, Singapore’s population is
forecasted to reach 6 million or an increase of 7%. Therefore, it can be anticipated the bus
population required to service commuters would potentially reach 19,000.
Figure 7: Motor Vehicle Population, Singstat, Department of Statistics Singapore
3.3 Challenges Faced by Target Market
While there is limited publicly available
information on the cost in running a bus
operation in Singapore, typical costs can
be categorised into fixed cost pertaining
to capital outlays in procurement of bus
assets and variable costs related to fuel,
maintenance, insurance and labour (Bus
Industry Costs Make-up and Trend
2016). For bus operators competing to
service public commuters, there are also
additional regulatory requirements to
comply in order to operate service routes
through a licensing agreement with LTA,
incurring additional costs (Licensing of
Buses 2016; Bus Services Industry
Regulations 2016; Bus Services Industry
Act 2015; Xue, 2015).
Based on the financial reports of SMRT
Corporation and SBS Transit, operating
$m $m
Operating Expenses 2016 2015
Staff Cost 536 483.6
Depreciation 203.7 193.1
Repairs and maintenance 139.9 121.9
Energy Cost 132.3 150.7
Other operating cost 223.7 223.5
Overall Cost 1235.6 1172.8
Total Dep, Repair, Maintenance, Energy Cost 475.9 465.7
39% 40%
Source: SMRT Financial Report 2016
SMRT
Operating Expenses 2015 2014
$m $m
Staff Cost 491.723 448.114
Depreciation 85.36 70.978
Repairs and maintenance 115.87 110.271
Energy Cost 173.961 184.03
Premises Costs 45.27 39.272
Other operating cost 86.578 77.691
Overall Cost 998.762 930.356
Total Dep, Repair, Maintenance, Energy Cost 375.191 365.279
38% 39%
Source: SBS Transit Financial Report 2015
SBS Transit
Figure 8: Operating Cost for SMRT, SMRT Corporation Ltd Annual Report 2016
Figure 9: Operating Cost, SBS Transit Annual Report 2015
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costs related to physical bus assets amounted to almost 40% in totality, just slightly behind
labour costs (Figure 8; Figure 9). This pattern is likely to reflect in the private bus sector.
3.4 Unmet Needs of Target Market
The ECO Bus aims to address and minimise the operating costs required on bus asset
management. While the initial capital outlay may surpass the conventional alternatives in the
market, in the long run, the ECO Bus will result in tremendous savings for bus operators by
providing clean and sustainable transportation solutions less the fluctuations in energy costs
and variable costs.
4. Macro-Environment Trends supporting ECO Bus
In this section, the PESTLE analysis framework is used to understand the macro-environment
trends. Based on the analysis, 5 of the 6 forces excluding economic factor are in favour of the
development of the ECO Bus. These six forces can be categorised into demographic,
economic, socio-cultural, technological, ecological and regulatory environment that are
elaborated further in the following sections (Claessens, 2015).
4.1 Demographic / Population characteristics Environment
As of 2016, the population of Singapore stands at 5.61 million and is projected to reach 6.9
million by 2030 (Cheam, 2013; A Sustainable population for a dynamic Singapore Population
White Paper 2013). Hence, public transport is viewed as pertinent in the movement of people
(Ng, 2015).
4.2 Economic Environment
The economic outlook of Singapore for 2016 is bleak with
forecast for growth now narrowed to between 1 to 2 per
cent (Tang, 2016). The impact on the development of the
ECO Bus will be largely attributed to the sourcing of raw
material components due to foreign exchange fluctuations.
Globally, the economic outlook is also bleak with
worsening trend in GDP for Q1 2017, increased
unemployment rates and price indices (GDP Growth Rate
Foreast 2016 - 2020). This could also dampen the mood on
bus procurersGood point as they may seek for cheaper
alternatives to save initial cost outlays. However, the impact
is likely to be limited as the government looks to increase
public transport expenditures to $36 million in 2016 as
compared to $11 million in 2015 with the aim of a ‘car-lite’
Singapore (Lim, 2016).
4.3 Socio-cultural Environment
By and large, Singaporeans have pro-environmental attitudes and are strongly concerned of
the impact that climate change could impact on them especially in the wake of the haze
pollution in recent years (Chearn 2012). Local and foreign companies are also doing their part
to seek ways in conducting their businesses in a sustainable manner. For example, Apple Inc.
powers its facilities in Singapore entirely on solar power and local companies are encouraged
to source for pulp and paper material from sustainable sources (Tham 2015; Saad 2015). In
Figure 10: Global Greenhouse Gas Emission by Economic Sector, IPCC 2014
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addition, newcomer such as HDT Singapore taxi is powering its fleet entirely using electric
vehicles (EV). All in all, these developments would place the ECO Bus in a favourable
perception among transport operators and the population at large.
4.4 Technological Environment
Due to the rapid advancement of technology, on a global scale, the cost of photovoltaic solar
panels is falling drastically (Fares, 2016). Locally, the same trend is reflected (Othman, 2015).
In a similar pattern, the cost of batteries for EVs have fallen from $1000 per kilowatt hour
(kWh) in 2010 to $350 kWh in 2015 and experts estimate when the cost of EV batteries reach
$150 kWh, pricing will be more competitive than conventional vehicles and for EVs to go
mainstream (Harrington 2016; Global trends in Renewable Energy Investment 2016, 36).
Similarly, the falling prices reflect technological improvements in battery productions,
economies of scale and competitive pricing among battery makers.
4.5 Ecological or Natural Environment
In recent years, the ecological damage caused by
climate change due to the use of fossil fuels is
increasingly recognised by the global community as an
urgent matter that warrants the need to switch to
renewable energy sources (Milman, 2016).
Transportation accounts for 14% of the total global
greenhouse emission in 2015 and this has been on an
upward trend due to reliance on fossil fuels (Global
Greenhouse Gas Emission Data; Figure 10; Figure 11).
As a party to the Paris Climate Agreement, the
Singapore government is implementing measures to
scale down carbon emission (Abdullah, 2016). Therefore, due to the increasing concerns over
the natural environment, ECO bus is likely to be seen as the preferred EV harnessing purely
on renewable energy with zero carbon emission.
On the carbon emission per dollar GDP, Singapore ranks 123 rd
out of 142 countries and 26 th
out of 142 countries based on per capita emission. This put it just behind Germany and ahead
of the United Kingdom (Figure 12). Based on this data, given a small country like Singapore,
the carbon intensity and per capita emission is extremely high, indicating more needs to be
done (Figure 13). Good
Furthermore, the geographical location of Singapore makes solar electric buses an extremely
viable alternative given that the country receives twice the amount of solar radiation than
temperate countries (EMA Solar Photovoltaic Systems 2016).
Figure 11: Trends in Global carbon emission from Fossil fuels, 1900 – 2011 Information Analysis Center, Oak Ridge National Laboratory, U.S. Department of Energy
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Figure 12: Source: CO2 Emissions from Fuel Combustion - 2015 Highlights ©
OECD/International Energy Agency, 2015
Figure 13: Source: CO2 Emissions from Fuel Combustion - 2015 Highlights ,
OECD/International Energy Agency, 2015
4.6 Political and Regulatory Environment
Government laws, policies and regulations can restrict and affect an industry as a whole
(What is Pestle Analysis 2016). For example, the Energy Market Authority (EMA) decision
to eliminate the cap of 600 MWp on solar energy is likely to encourage wider application
(Siau, 2014).
As a low-lying island state, an increase in global temperature can have significant impact on
Singapore (Navaratnarajah, 2015). While Singapore’s contribution of 0.11% to global
carbon emission may seem insignificant, on a per person basis, it produces more than 8 tons
of carbon in 2013 compared to 6.6 tons per person in China (Singapore’s Emission Profile
2016; Singapore Data 2016; Chan 2016). Furthermore, based on projections from 2005,
vehicle emission will continue to remain as the second largest source of carbon emission after
industrial output if no measures are implemented to curb it (Figure 14).
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The main hindrance to EVs is largely due to regulatory
issue as they are costlier than combustible vehicles
because of the formula used in computation of carbon
emission for vehicle scheme rebate and road taxes (Ng
2016; Xue 2014). This is an anomaly in which the
government has taken a ‘wait and see’ approach to
formulating an EV policy. Furthermore, the rebates for
EVs should improve adoption rate of EVs (Is Singapore
about to embrace the electric vehicle trend 2016).
However, the regulatory framework is positive in
encouraging the use of renewable energy. In fact, strong
political will is in place towards alternative energy
sources. In tackling the problem, the government has
launched its climate action plan and has taken a
proactive stance towards cutting carbon emission,
encouraging a car-lite society and advocating the use of
public transport and harnessing renewable energy
sources. For example, it is launching a national EV car-
sharing scheme next year as an alternative to car ownership (Ng, 2016). Apart from this, the
government is also looking to build physical infrastructure to support the proliferation of EVs
such as increasing the number of charging points to 2000 (Ping, 2016). In addition, the
Housing Development Board (HDB) is increasing the use of solar panels in housing estates,
schools and food centres (Khew, 2016). In fact, the first full electric bus has begun trialling
while the LTA is supporting a charging infrastructure for an autonomous electric-hybrid bus
is being tested (Lim, 2016). Furthermore, a solar powered bus stop is also under
experimentation (Heng, 2016).
With these developments, it is likely for the government to put in place a special EV policy
for buses and a separate one on private EV ownership. It can be established the political and
regulatory environment is in favour of the development of the ECO Bus.
5. SWOT Analysis
By using the SWOT analysis as part of ECO Transport’s organisational analysis namely
through its strengths and weaknesses, it would allow an assessment to gain a competitive
advantage. At the same time, by looking externally, ECO Transport can identify opportunities
and threats that could affect business (Simmering and Helms, 2006, 771; Kearns 1992, 4).
3.6.1 Opportunities
3.6.1.1 Potential for New Markets
As the EV market in Singapore is in its infancy, there are plenty of potential for market
growth and expansion. Beyond Singapore, the global electric bus market is forecasted to grow
at a compounded annual growth rate (CAGR) of almost 20% by volume from 2016 to 2025
(Global Electric Bus Market Forecast to 2020; Figure 15). In fact, China is anticipated to
account for 50% of the total global volume with early adoption taking place in various parts
of the world including the United States, Germany, France, Uruguay and Brazil (Global
Electric Bus Market Size Share Development Growth and Demand 2016; Electric Drive
Buses 2012). Furthermore, major cities such as London, Tokyo, Hong Kong and New York
Figure 14: Projected 2020 Business-As-Usual Greenhouse Gas Emissions 2020, NCSS
Comment [J2]: Very well written
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where demands for public transport is high, there are potential for ECO buses to tap into for
future growth (Key Transport Statistics of World Cities 2012).
At present, the major deterrent to the
mass adoption of electric buses is
the lack of infrastructure such as
charging stations. Despite highest
demand for public transport in the
BRICS (Brazil, Russia, India, China,
South Africa) countries, price
sensitivity is an issue (Global
Electric Bus Market Size, Share,
Development, Growth and Demand
Forecast 2016; Electric Drive Buses
2012).
With the solar panels built on board
the ECO Bus, power can be charged
directly to the battery storage
without the need for physical charging stations. This could potentially reduce the cost of
implementation for electric buses in
the future.
3.6.1.2 Government grants and venture capitals
With the government’s interest of tapping on solar energy as an alternative source of power
and as a new start-up, the ECO Bus project will tap into various grants available to defray
research and development (R&D) costsYes (Othman, 2015). This could involve the use of
the capability development grant (CDG) in areas such as brand and marketing strategy
development, business excellence, achieving quality and standards, intellectual property,
technology innovation (Capability Development Grant 2014). Alternatively, options include
the ACE Startups Grant and Technology Enterprise Commercialisation Scheme (ACE
Startups Grant 2016). Apart from these options, the ECO Bus project can tap into venture
capitals with SPRING SEEDS Capital and other external investors who are keen to take up a
stake in ECO Transport.
3.6.2 Threats
3.6.2.1 Copycat Products The success of the solar-electric ECO Bus is likely to spur copycats or competitors to
duplicate it. Existing foreign electric bus manufacturers such as BYD, Ebus, to name a few
would adapt and emulate the technologies by ECO Bus. In order to starve off copycat
products, ECO Bus Transport could either seek patent protection for its sensor based
photovoltaic panels.
3.6.2.2 Increased cost of raw materials
The poor outlook on the global and local economy would pose a significant threat to the
development of the ECO Bus due to the increased cost of obtaining raw materials. This is
largely attributed to exposure from foreign exchange fluctuations.
Figure 15: Annual Electric Drive Bus Sales by Region, World Markets Forecast: 2012 - 2018, Pike Research
17
3.6.2.3 Competition
Direct competition against the ECO Bus is likely to come from foreign market players
rather than local bus manufacturers which at present, lack the technical capabilities. The
Chinese electric bus manufacturer, BYD, is the most direct source of competition, given its
position as a top maker in China with international presence in South America and key cities
such as London and New York in delivering electric buses (Wang and Yang 2013, 13, BYD
unveils World’s first battery electric coach bus 2015). It has also begun trialling its K9
electric bus in Singapore recently with bus operator Go-Ahead Singapore (Lim, 2016).
Meanwhile, US makers such as Proterra, Ebus and GreenPower have focused primarily in
the North American market (Green Power Bus 2016; Proterra 2016; BYD 2016; Electric Bus
Manufacturer 2016). With the entry of ECO Bus, these market players are likely to increase
their R&D to counter the ECO Bus.
Indirect competition will come from the conventional foreign bus manufactuers such as
Volvo, MAN, Mercedes, Scania, Alexander Dennis that supply to the public bus sector
whereas local manufacturers such as Liannex, SC AUTO, Soon Chow Corp and LexBuild
compete with Chinese bus makers such as Golden Dragon, Yutong, King Long, Higer, and
Zonda in the private sector (Tenders 2016; Liannex 2016; Ee 2016; Higer Bus Singapore
2016; Zonda Group News 2009 ; Abwin Bus Pte Ltd 2011; Lin 2011). Good
3.6.2.4 Technological hindrance and Safety Currently, technology for electrical vehicles is improving. However, it has not reached the
level mass adoption. There are also safety concerns with installation of batteries in vehicles
due to explosions, fuel leaks or in accidents (Bullis, 2013). The case of a Hong Kong
prototype electric bus that was charred due to short circuit could also raise scrutiny on
electrical buses (Mok and Leung, 2015). On the other hand, with vehicles such as Nissan
LEAF achieving a full score on the Euro NCAP safety standards, it does seem that safety
should not deter the development of the ECO Bus (Conway, 2011).
3.6.2.5 Government Regulations The concern of government regulations hindering the development of the ECO Bus in
Singapore is low given the increased attention towards climate change and the need for
alternative fuel source. However, should safety issues arise concerning the ECO Bus, there
could be regulatory issues. This is likely to mirror in overseas markets.
4. Competitor Assessment
In this section, the bus manufacturing industry is assessed using the Porter’s five forces
analysis to determine the competition and industry attractiveness (Porter’s Five Forces 2016).
4.1 Industry Business Description
Currently, the Singapore bus manufacturing sector comprises of locally produced, Chinese,
European and Japanese imported or reassembled buses (Ee, 2016). The public bus transport
companies often opt for European imported or assembled buses largely due to their expertise
in producing fuel efficient vehicles that meet pollution standards whereas private bus
transport operators tend to opt for cheaper alternatives such as Chinese built vehicles (Ee,
2016). The proposed dual powered solar-kinetic regenerative ECO buses will compete against
these options to provide clean, self-sustaining and efficient travel for commuters and
drastically reduce cost operations on bus operators in Singapore.
18
4.2 Porter’s Five Forces Analysis
4.2.1 Threat from new entrants Overall, with the numerous bus manufacturers dominating the current Singapore bus market,
the threat of new bus manufacturers entering the market is low. However, the threat of fully
assembled Chinese electric bus exports through an agent without the need for a manufacturing
base here is a concern. This is the strategy adopted by BYD (Lim, 2016). On the other
hand, the ECO Bus is differentiated through better and self sustaining technology.
Meanwhile, there is strong product differentiation among the current local bus manufacturers.
For example, European manufacturers focus on cleaner emission, Chinese makers on cheaper
alternatives while local assemblers improve on technology and design (Ee, 2016).
Furthermore, strong capital investments such as R&D are needed to penetrate the Singapore
bus manufacturing sector and gaining distribution for a relatively new brand can be
challenging (Lin, 2011). In considering the threat from new entrants, the regulatory
environment has to be considered (Assessing the Industry using Porter’s Five Forces 2014).
By seeking a patent protection on the sensor based solar-electric power system of the ECO
bus or lobbying the government for support, these efforts could also slow down new
competitors from entering the market and starve off copycats.
4.2.2 Bargaining power of customers
The Singapore public bus industry comprises of established players which include SBS
Transit, SMART and new foreign operators, Tower Transit and Go-Ahead Group to stimulate
competition (Lim, 2015). With changing practices to a contractual model, the procurement of
buses by public bus operators will gradually be taken over by LTA while service routes will
be contracted to the bus operators (Bus Industry to complete transition to Bus contracting
model on 1 September 2016; Lim 2015). This change in procurement process will consolidate
control for LTA, making it the owner of the largest bus fleet in Singapore, giving it
substantial bargaining power and one of the most important clients to market the ECO Buses
(Bus Services, 2016). Beyond this, private bus operators are another potential market for
consideration. Furthermore, with the government’s initiative through the Early Turnover
Scheme (ETS) to encourage quicker turnover of older buses to more environment friendly
buses, the ECO Bus with high fuel efficiency and zero carbon emission would attract major
bus procurers (Enhanced incentives from August 2015 to further encourage Category C
Diesel Vehicle Owners to Go Green, 2015)
4.2.3 Bargaining power of suppliers
The ECO bus would require
photovoltaic panels as a key resource
component. Currently, the there are a
sizeable number of solar power
suppliers that specialise in production
of photovoltaic products for
residential, industrial or commercial
installations (Solar Companies 2016).
Beyond this, there have not been any
forms of industry wide application of
solar powered vehicles in Singapore.
With the advancement of technology
and wider number of suppliers, the
cost of solar panels has fallen drastically over the years by as much as 75% with the typical
Figure 16: Key components for BEV, Frost & Sullivan
Comment [J3]: The threat is high or low?
19
solar panels now ranging between $15,000 and $25,000 (Chan, 2015). This reduces the
bargaining power of solar power suppliers as fallen prices would make the panels for ECO
Bus substantially cheaper.
Another key ingredient for ECO Bus would be the rechargeable battery component which
typically accounts for 25% of cost for electric buses (Wesoff, 2015; Figure 16). Currently,
various electric bus makers use a variety of batteries. Tindo, the world’s first fully solar
powered bus uses environmentally friendly, Swiss-made sodium/nickel Zebra batteries while
full electric vehicles such as Tesla and Nissan Leaf use the more widely applied lithium-ion
(Li-ion) batteries (Tindo The World’s first solar electric bus 2013 Solartaxi Zebra Battery
2016; Nissan Leaf Electric Cat Battery 2016).
The top suppliers for electric vehicle (EV) batteries include Japan’s Panasonic commanding
38% of market share followed by China’s BYD at 14% and Korea’s LG Chem at 12%
respectively (Ayre, 2016 ; Figure 17). Despite the various benefits of Li-ion over nickel
technology, such as higher cell voltage, lowers self-discharge rate and lack of memory effect,
the ECO Bus would adopt Toshiba’s SCiB lithium-titanate batteries as apart from having the
above mentioned benefits, it has longer lifespan, support fast charging and proven safety
(SCiB Cells, 2016). This is the same battery technology adopted by Proterra (Toshiba to
Provide Rapid Recharge SCiB Batteries for Proterra Zero-Emission Bus Fleet, 2014).
With the current low fuel prices coupled with the shortage of charging stations, demand for
EVs are not high despite a larger supplier pool. In turn, this would reduce the
bargainingGood power of EV battery suppliers (Ramsey, 2015).
Figure 17: Top 10 Electric Vehicle (EV) Battery Producers (2015 vs 2014)
20
The last main raw component would be composite material for the bus chassis. This would
improve the life cycle of the buses and provide superior strength while being lightweight. In
turn, it reduces energy consumption and results in cost savings in terms of maintenance as
compared to conventional steel bus body. However, initial capital cost is expected to be 7 to 8
per cent higher than conventional bus body (Mishra, 2011). Presently, the supplier for
composite material is largely fragmented. In order to reduce cost, the ECO Bus would be
design locally while the manufacturing of the bus chassis and body will be outsourced to a
Chinese supplier (Composite Electric Bus Body 2015).
4.2.4 Threat of substitutes
Competitors include substitutes such as the conventional diesel bus manufacturers, electrical,
compressed natural gas (CNG) hydrogen electric or fuel cell and diesel hybrid buses (SBS
Transit Embarks on Singapore’s First fuel cell and Hybrid Bus Trials 2010; NTU gets
GreenLite for Singapore’s first truly eco-friendly bus 2010). However, the threat of substitute
is considered low as the ECO bus is differentiated in which it will derive its fuel source
from both sunlight and through kinetic energy derived from regenerative braking. This would
mean the ECO bus will be entirely self sustainable without the use of any fossil fuels.
Furthermore, while substitutes in the market have introduced EV vehicles that cut or produce
zero carbon emission, the conversion of fossil fuel to generate electric power to power these
vehicles nonetheless do not represent a full environmental solution. Hence, in comparison,
these substitutes are not on par with the ECO bus.
4.2.5 Intensity of Rivalry
In terms of rivalry intensity in the bus manufacturing sector, this is considered high.
Currently, conventional foreign bus manufacturers include Volvo, MAN, Mercedes, Scania,
Alexander Dennis that supply to the public bus sector whereas local manufacturers include
Liannex, SC AUTO, Soon Chow Corp and LexBuild compete with Chinese makers such as
Golden Dragon, Yutong, King Long, Higer, and Zonda in the private sector (Tenders 2016;
Liannex 2016; Ee 2016; Higer Bus Singapore 2016; Zonda Bus News 2009 ; Abwin Bus Pte
Ltd 2011, Lin 2011). With the introduction of the ECO bus, it is likely to draw even stronger
competition from overseas especially electric bus manufacturers including BYD or other
remote players such as GreenPower, and Ebus which currently focus on the North American
market or existing solar bus markers such as Designline International, Brighton Energy
Cooperative and Kiira Motors (Green Power 2016; Proterra 2016; BYD 2016; Ebus 2016;
Kiira Motors 2016; Hall 2016; Tarantola 2013)
4.3 Conclusion on Porter’s Five Forces
Based on the above discussion, the threat of new entrants is low due to the need for capital
investments and R&D. Meanwhile, suppliers are in weaker position as they are numerous and
unlikely to forward integrate easily. As for buyers, bargaining power is high due to one
procurer for the public transport sector and alternative options for private bus operators. The
threat of substitute is considered low as none are able to fully replace the functionalities of the
ECO Bus. However, intensity of rivalry is strong due to numerous bus manufacturers. In
summary, three of the five forces are favourable, while two are unfavourable. Hence, the
Singapore bus manufacturing industry is attractive to enter. Good
4.4 Critical Success Factors
Critical success factors (CSFs) are defined as the key ingredients or vital information that will
determine the success of a business (Morrison 2012; Gordon 1979; Forster and Rockart 1989,
23). These are subdivided into industry, competitiveness, environment, temporal and
managerial factors.
21
4.4.1 Industry CSF
In terms of industry, the CSFs are efficient supply chain and production process. This would
also mean the need to manage supplier relationships to ensure raw materials required for the
production of the ECO Bus are timely as any delays could be detrimental to production
schedules. Investments in technology such as robotic bus body tooling will also be necessary
to ensure productivity.
4.4.2 Competitive CSF
Due to the unique dual powered system of the ECO Bus, ECO Transport is positioned to be in
a leading industry position compared to existing competitors in the market.
4.4.3 Environmental CSF
The environment factors such as the economy, regulatory, political and demographics of
Singapore create a holistic CSF for the ECO Bus. The government’s encouragement to adopt
EV vehicles under the Early Turnover Scheme could woo bus procurers to consider the ECO
Bus (Early Turnover Scheme for Category C Vehicles, 2016). While the outlook on the state
of the Singapore economy has not been positive, and tempting for bus procurers to look at
cheaper alternatives, it is unlikely to have a significant impact on the ECO Bus given the long
term cost savings it would achieve. Furthermore, public buses would continue to remain of
one of the key pillars of transportation in Singapore (Shaffer 2016; Sam and Sun 2015).
4.4.4 Temporal CSF
As the term suggests, temporal CFSs are reasons related to short-term situations such as
crises. These are activities that become critical for a particular duration. In the near term,
securing the necessary capital investments and raw components to begin design and
prototyping will be the key temporal CSF.
4.4.5 Managerial CFS
This concerns the need for the various departmental management teams to work closely and
ensure the success of the ECO Bus. It is crucial for the R&D, production, procurement and
marketing departments to time the effort strategically.
Most importantly, the R&D team is instrumental to the success of the ECO Bus. ECO
Transport seeks to bring in the expertise of the original team that created the EVA electric
taxi, the first made in Singapore EV (Feng 2015; Ng 2016; EVA by TUM CREATE Electric
Taxi for Tropical Megacities 2016). With the shared mission to created sustainable transport
solutions in Singapore, there is synergy to see transfer of technical know-how from an electric
car to a mass transit vehicle in a tropical environment.
4.5 Current Market Conditions
The current market conditions are in favour of the development of the ECO Bus. Firstly, the
government is placing strong emphasis on efficient public transportationGood and
willingness to put in place of physical infrastructure to support the proliferation of EVs (Sam
and Sun 2015). For example, a pilot project has been implemented for the first solar bus stop
and the push for depots to be powered fully by solar power (Lee 2016; Heng 2016).
22
4.6 SWOT Analysis
Based on the above discussion, an analysis on the strengths and weaknesses of the ECO Bus
is identified as being innovative, with better advanced technologies whereas the downside
relates to the initial cost outlays involved.
4.6.1 Strengths
4.6.1.1 Reputation for innovation
Being the first in Singapore, the ECO Bus would gain a first mover advantage over
competitors. With this product, the company is able to establish a reputation for innovative
transport solutions. With a strong R&D team and a management that is driven to see success,
backed by Proterra’s EV Fast charging technology patents that are open source and royalty
free, ECO Transport aims to capitalise on this and incorporate the know-how into the
production of the ECO Bus locally (Lambert, 2016).
4.6.1.2 Fast charging technology With fast charging technology, this would mean that the ECO Bus would be fully charged
within a 10 minutes interval compared to the Chinese EV manufacturer, BYD K9 electric bus
which requires five to ten hours for full charge in order to travel a maximum of 250km (Lim,
2016). However, the ability to harness the fast charging function on a large scale is highly
dependent on the government’s support to implement the proposed fast charging
infrastructure which would allow a 100 kWh electric bus to be charged within 10 minutes
(Gitlin, 2016). This would be a much more practical option compared to BYD electric bus
that would hog charging stations for a minimum of 5 hours to full charge. Within the same
timespan, it would allow 30 ECO Bus to be fully charged. The fast charging facility will only
be necessary in bad weather conditions as the main power source of the ECO Bus is derived
through solar power based on sensor based photovoltaic panels that automatically position in
the direction for best sun exposure and power stored into on-board batteries.
4.6.1.3 Longer Distance Coverage
Presently, BYD’s K9 electric buses have a maximum capacity of 80 kWh whereas the ECO
Bus will be built to have a maximum power capacity of 100 kWh which would allow it to
travel for 300km without the need to be recharge. While travelling, the ECO Bus could
recharge through its solar panels without the need to stop for refuelling. On average, a bus
passenger trip in Singapore is 4.3 km. This would allow the ECO Bus to make almost 70 trips
before the need for a recharge (Singapore Land Transport Statistics in Brief 2015). Also, this
would allow bus operators to maintain a more efficient, nimble and smaller fleet which can
constantly be plying the roads and generating revenue instead of idling to charge for fuel.
4.6.2 Weaknesses
4.6.2.1 Slow diffusion rate translates higher cost structure
The adoption of EVs in Singapore is in its infancy albeit more government initiatives and
encouragement to increase its adoption rate. Hence, bus procurers may be reluctant due to the
initial higher capitals required for the ECO buses.
4.6.2.2 High cost in R&D
Due to the innovative product, high investment costs into R&D will be required to kick-start
the ECO Bus project. Subsequent generations of ECO Buses will also require substantial
investments in this in order to prolong the product life cycle.
23
4.6.2.3 High Loan Rates
Being the pioneer, high interest rates from financing firms or banks are likely given the costs
involved in R&D.
5. Marketing Strategy
In accordance with the SMART objectives of the business as outlined in section 2.5 and
business mission to be the market leader in transport solutions, the following four marketing
objectives are set forth for the company.
5.1 Marketing Objectives
Firstly, Eco Transport aims to increase its market share in the overall bus sector in Singapore
by 2% by November 2019. The ECO Bus This will be tied to securing at least one key
customer account with the aim to generate $1.71 million of sales by 2019. In order to support
this market growth objective and raise product awareness on the Eco Bus, Eco Transport
hopes to increase the number of sale leads or enquiries on the ECO Bus from marketing
communications activities by 10% monthly from its official launch in end October 2017.
Secondly, Eco Transport plans to launch at least 1 new product, the variant version of the 40
foot ECO Bus – a 22 foot into the product channel in 2023 to increase product offerings and
target the mid-size and private bus market.
Thirdly, in order to gain a competitive advantage, ECO Transport seeks to cut back on order
lead time by 10% from 2019 onwards on the production of ECO Bus.
Lastly, in order to support the APAC expansion plans, beginning with Hong Kong and
Tokyo, ECO Transport aims to recruit and secure two exclusive distribution agents in the two
targeted markets and a third for Greater China within a year starting from 2022 for the ECO
Bus.
5.2 Overall Marketing Strategy
According to Porter’s generic strategies, a firm can adopt one of the strategies namely being a
cost leader, differentiator or being niche focus based on cost or differentiation to compete in
the market (Porter’s Generic Strategies – Your Route to Competitive Advantage 2013).
ECO Transport adopts the differentiator strategy in order to achieve the marketing and
business objectives. It aims to become the market leader and compete in the bus
manufacturing market. This direction requires the ECO Bus to be differentiated on certain
attributes to build long term competitive advantage. Apart from offering a technologically
superior product, ECO Transport aims to compete for point of differentiation in factors such
as after pre and post sales service with product innovation.
Within an eleven months timeframe, the ECO bus design will undergo extensive primary and
secondary research to identify the gap with existing products in the market. This is followed
by, planning, product design, development (R&D) and prototyping to meet regulatory
roadworthiness and safety standard certifications. Typically, a project on this scale takes
between 13 months to two years to complete (SBS Transit to introduce Singapore’s First
Wheelchair Accessible Low-Floor Superbus 2006; Leung 2015). With Tum Create and
Proterra’s borrowed expertise, the timeframe is possible to shorten since development would
not start from scratch.
24
The following marketing mix activities have been devised to align the 4Ps to support the
various marketing objectives of ECO Bus slated to commence from the planned product
launch on 31 October 2017.
Concurrently with product development, ECO Transport will set up its corporate website. A
beta version of the website is available for view at http://ruverecalvin.wixsite.com/website. To
herald the planned product launch officially on 31 October 2017, ECO Transport will launch
a microsite, an offshoot from the corporate site, dedicated solely on the ECO Bus, detailing
the solar panels, battery, technical and specifications to canvass interested buyers. In addition,
an e-brochure acting as a product catalogue will also be made available for online download.
Through an official press release, media kit and public relations effort, the company hopes to
generate hype and excitement around the ECO Bus.
Press tours will also be organised for the mass media to introduce the ECO Bus and increase
potential for media coverage. Key personnel from Proterra, Tum Create and government
officials from the Ministry of Transportation and LTA will be invited to preside over the
official ceremony of the ECO Bus launch and the assembly facility. The key cornerstone of
the marketing strategy involves investments in direct marketing and participation in relevant
trade shows. The company will also utilise social media such as setting up a Facebook
business page and a LinkedIn account. However, social media are mainly utilise to maintain a
general social presence. Effort would be put in place to ensure up-to-date content and videos
on corporate developments, or news to engage the general public on the company’s
endeavours. Additionally, Google advertising such as adwords, search engine optimisation
(SEO) and search engine marketing (SEM) SEO would be utilised to boost improve page
ranking, boost search on the ECO Bus and traffic to the corporate website.
5.3 Brand
The brand name, ECO Bus, as a brand extension from ECO Transport is aim at associating
the vehicle as being environmentally friendly among customers. The brand logo, in blue
symbolises reliability and trust while the bus image depicts a fast efficient vehicle (Bourne,
2016). The tagline, “Towards Self-sustaining, Clean & Efficient Travel” aims to encapsulate
the essence of the ECO Bus.
5.4 Product Positioning Product positioning refers to the consumer’s perceptions in relation to a product and occupies
a special ‘position’ in the mind of consumers (Perreault and McCarthy 2002, 85). The ECO
Bus is positioned as a high quality, clean alternative transport vehicle that aims to deliver
almost 21% of long term cost savings to transport operators as compared to operating a
conventional diesel bus fleet. The ECO Bus is positioned as a strategic choice with a strong
unique selling proposition on harnessing renewable energy for bus operators.
5.5 Product Decisions
In terms of product decisions, this can be categorised in three levels which are the core
product (features and benefits), actual product that encompasses brand, packaging, labelling
and the augmented product such as product support (Claessens, 2015).
5.5.1 Core Product The core product or main benefits of the ECO Bus is the long term savings to bus operators
resulted from the product self-sustainable capability and reduced maintenance costs.
25
5.5.2 Actual Product
The ECO Bus is powered by harnessing solar energy into electrical power to fuel the vehicle.
10 sensor based SHARP solar panels installed on the bus roof detect the direction of the sun’s
rays and reposition for maximum sunlight exposure automatically (Solar Panels 2016). Then,
electrical power is fast charged to the battery bank within 10 minutes. The estimated timespan
to full charge is dependent on weather conditions and sun exposure. By using Proterra’s
regenerative braking technology, as much as 92% of kinetic energy generated will act as an
additional power source for the ECO Bus (Hanley, 2016). The bus body and chassis made
primarily of composite material are long lasting, durable and reduce maintenance cost as
compared to conventional steel body of diesel buses. The default bus exterior livery will be in
green which is usually associated with renewable energy.
5.5.3 Augmented Product ECO Transport will offer a 12 years warranty for the battery component to match against
BYD while standard warranty consists of 2 years for the complete bus which set ECO Bus
apart from the industry norm of a 1 year warranty (Proterra Catalyst Platform Tearsheet 2016;
Volvo Coach Product Range 2016; 40 ft bus 2016). On ECO Transport’s website, a live
support agent application will be incorporated to facilitate faster response time to queries.
5.6 Pricing Decisions
5.6.1 Pricing Objective
Pricing is one of the crucial elements of the marketing mix and determine the revenue that
would be generated from the product. As the SMART business objective of ECO Transport is
to become the leader in providing high quality transport solutions to operators, the quality
leadership pricing objective is appropriate (Pricing Strategy 2010; Leigh 2016). In doing so,
price is used to signal superior quality so as to position ECO Bus as the leading brand in
producing solar electric buses.
5.6.2 Pricing Strategy
Due to advanced technologies and innovative nature of the ECO Bus which allows a
significant competitive advantage through proprietary technologies over potential competitor
such as BYD, and to meet the pricing objective, ECO Transport will adopt the price
skimming strategy. Firstly, by adopting this pricing method, it will allow the company to
maximise profits by commanding premium price to early adopters while recouping the cost of
development and at the same time, signal an image of quality in the market (Maguire, 2016;
Kirk 2013). Eventually, the price will be skimmed down for more price sensitive bus
operators and when competitor such as BYD starts introducing similar products.
Based on the data presented, the average cost of a conventional diesel transit bus in Singapore
is SGD$690,561.64 (Figure 18; Figure 19). Currently, BYD electric buses are priced at
SGD$581,400 and the government has signalled its willingness to adopt transit electrical
vehicles. At first sight, this appears to be a cost effective option. However, in order for the
BYD electric bus to achieve mass adoption, this would require installation of charging
stations which could result in overall cost to SGD$1.9million (Figure 18). Based on this
figure, this represents the willingness to pay. Furthermore, the future of electric buses and
charging stations are part of LTA proposed 2050 road map (Siau, 2016). If ECO Bus has
chosen a cost-plus method taking into the account of production and a hypothetical 20%
markup, it could be priced at SGD$754,473.75. Instead, to align ECO Bus with the pricing
objectives, the premium price could possibly start at SGD$1.9 million which could then be
26
skim down over time for price sensitive bus operators. Furthermore, the ECO Bus could
eventually skim down to SGD$754, 473.75 while ECO Transport continues to innovate and
product new variants or improved buses (Figure 18).
Hence, on the onset, the ECO Bus could be perceived to be a costlier choice by almost 70%.
In reality, the pricing does not vary much in the long term. In addition, the price comparison
has not factored in that the potential labour cost and additional cost of building charging
stations for each BYD electric bus which require up to 10vhours of charging time. BYD’s
solution would require charging infrastructures to be installed across bus terminals,
interchanges and bus stops across Singapore in order to gain mass adoption. Furthermore,
BYD’s electric buses require a time period of 5 to 10 hours to gain full charge. This
capability issue in its technology is likely to impede BYD’s growth as manpower cost and
rotation of buses would be needed to get full refuelling for its vehicles.
Figure 18: Cost comparison to price the ECO Solar Bus
SBS Transit SMRT BYD K9 Electric Bus Proterra Electric Bus ECO Solar Bus
Operationg Expense Million Million
Depreciation 85.36 193.1
Repairs & Maintenance 115.87 121.9
Energy Cost 173.961 150.7
Bus Fleet 3400 1400
Average per Bus Operating Expense 0.11 0.33
Average per Bus Procurement Cost, cost has
likely been reduced due to supplier bulk
order discount
0.47 0.38
Overall Long term cost per bus (Million) 0.58 0.71
Overall Long Term Cost per bus (Thousand) $110,350.29 $332,642.86
Average Purchase Price Per Bus, assuming
supplier discount of 10% is removed $521,387.28 $416,742.85
$631,737.58 $749,385.71
Average
1 Conventional Charging Station $12,510.00
1 Conventional Fast Charging Station $83,538.00
Estimated 60 Conventional Charging
Stations for mass adoption $750,600.00
Estimated 38 Fast Charging Stations for mass
adoption - 21 Bus Interchange; 17 Bus
Terminal $3,174,444.00
Yearly Fuel Consumption Per Bus $51,165.00 $107,642.86 $13,900.00 $13,900.00
Average Yearly Fuel Consumption Per Bus $13,900.00 $13,900.00
Average Per Bus List Price $690,561.64 $581,400.00 $1,390,000.00 $754,473.75
Long Term Cost for Mass Adoption $1,332,000.00 $4,564,444.00
$1,913,400.00 $5,954,444.00 $1,900,000
* This List price is based on cost plus a 20% Markup
* Ultimate price for ECO Bus could be at $1.9million, as LTA is looking at the possibility of mass adoption of Electric Bus,
which signals this as the amount they are willing to pay for
Source: Extract from SBS Transit, SMRT Financial Statements, Singapore Land Transport in Brief 2015, LTA, Sorge 2012
2015
Data Not Available Data Not Available Data Not Available
$79,403.93
Remaining Portion reported in '000
$690,561.64
27
Figure 19: List Price of an average SBS Bus before supplier discount
Figure 20: List Price of an average SMRT Bus before supplier discount
Figure 21: Cost & Price Comparison of Proposed ECO Solar Electric Bus with BYD and
Proterra, Various source adaptation from Kailasam, Frost and Sullivan, BYD, Proterra
Inc, Kamtex Industries, Sorge 2012
SBS Transit 000 000 000 000 000
2017 2016 2015 2014 2013
Procurement of Buses $23,142.00 $328,413.00 $226,116.00
No. of bus procure 481 59 842 580
Average Estimted Cost of an SBS Bus $389,855.17 $389,855.17 $389,855.17 $389,855.17
In 2013, 403 buses & 177 BSEP bsues (Bus Enhancement Program Buses procured) = 580 buses
Out of the capital commitment of $210,541,000, $187,399,000 relates to the capital commitment for procurement
of new buses scheduled for delivery in 2016 and 2017. The Group will be novating these procurement contracts to LTA
Source: SBS Transit Annual Report 2015, SBS Transit Annual Report 2013
$164,000,000 Single Deck Double DeckTotal Bus Procured Total Cost
100 246 346 $164,000,000
Avg cost of SBS Bus $473,988.44
Bus Fleet of SBS Transit 3400
Source: Lim, 2015 ; SBS Transit c
$187,399.00
SMRT
Bus Fleet 1400
Total Cost of Bus Procurement $66,300,000.00
No. of Buses Procured under BSEP Program 175
Avg cost of SMRT Bus $378,857.14
Source: SMRT
Cost & Price Comparison
BYD Electric
K9 Bus
Proterra
Electric Bus
Conventional
City Diesel
Bus in US
ECO Solar /
Electric Bus
Solar Panels $200,000.00
Battery System NA $85,745.63
Chassis & Powertrain $166,800.00 $116,760.00
Bus Body $152,900.00 $107,030.00
Seating System $31,275.00 $21,892.50
Other Soft systems $139,000.00 $97,300.00
Extended Warranties
Spare Parts & Service Support
Delivery $137,193.00 $137,193.00 $137,193.00
Sale Price (SGD) $581,400.00 $1,390,000.00 $1,876,500.00 $754,473.75
After Taxes $622,098.00 $1,487,300.00 $2,007,855.00 $807,286.91
Fuel Consumption 1.2 kWh/km 1.13 kWH/km 1.13 kWH/km
Average Bus Trip Distance in Singapore 4.3km 4.3km 4.3km 4.3km
Time required for full charge 5 to 10 hours 10 minutes 10 minutes
Average Bus Trip Consumption in Singapore 5.16 kWH 4.86 kWH 4.86 kWH
Yearly Fuel Consumptioin $13,900.00 $13,900.00 $69,500.00 $0.00
Cost of 1 x Conventional Refuelling Charging Station $12,510.00
Cost of 1 Fast Charge Refuelling Station NA $83,400.00
Cost of 60 x Conventional Refuelling Charging Station $750,600.00
Long Term Cost $1,345,900.00 $1,624,493.00 $1,946,000.00 $754,473.75
Long Term Savings vs Conventional Diesel Bus $600,100.00 $321,507.00 $1,191,526.25
$195,990.00
UndisclosedUndisclosed
28
Assumptions made in Figure 21 from Frost and Sullivan:
1. Base Price of a 12m (40 ft) diesel bus is between S$487,305 to S$626,535.
2. Cost assumption are based on transit diesel bus cost breakdown in North America
3. Hybrid transit bus could average add SGD$174,000 - SGD$208,845 premium on base
diesel version
4. CNG transit bus could average add SGD$97,500 to SGD$111,384 premium on base diesel
version
5. Indicated prices are listed price. Extended warranties, spares, and service support has not
been included which on average add 30 to 50% on procurement cost
Unlike Proterra’s positioning as a ‘Made in the USA’ vehicle, the ECO Bus components are
built through a chain of various suppliers overseas in Asia which could reduce component
parts by as much as 30% and assembled in Singapore – composite body and chassis in
China, battery technology by Proterra paired with a local team that has expertise in tropical
conditions ensure battery reliance is not affected and Japan’s Toshiba to provide the battery
source (Figure 18). In long term cost, the ECO bus results in the most savings (Figure 21). It
gained the most in cost efficiency after factoring its fuel efficiency, self sustaining fuel system
and does not necessarily have to rely on the need for charging stations. All in all, it eliminates
fuel cost and reduces cost in maintenance which typically amount to the second highest
operating expense for a bus fleet.
5.7 Distribution Decisions
5.7.1 Exclusive Distributor and Wholesale Locally, leveraging on its strength, ST Kinetics will be appointed as the exclusive local
dealer, a leader and distributor for MAN Truck and Bus AG (Singapore Technologies
Engineering Ltd 2016). Trade discount of 5% will also be offered to ST Kinetics. It would be
involved in providing repair and maintenance service for the ECO Bus.
5.7.2 Internet in Distribution Channel Apart from channel distribution, ECO Transport will capitalise on the internet as a
distribution channel. The ECO Bus could also be distributed through direct sales (zero
channel level) conducted via the product’s microsite and trade shows such as LTA-UITP
Singapore International Transport Congress and Exhibition (About the Event 2016).
5.7.3 Sales Force ECO Transport will develop its three sale force teams consisting of five members in order to
sell direct to bus operators.
5.8 Promotional Strategies
Unlike B2C products, the ECO bus is a B2B product and hence will not see a large portion of
budget allocated to advertising. Instead, a high proportion of the budget will be allocated for
the purpose of public relations, sales promotions and direct marketing as well as personal
selling (Hague, 2016).
29
As the ECO bus is a new product in the market, both push and pull strategies will be crucial in
the introductory phrase of the product life cycle. The communications objectives here are to
create wide awareness and generate interest. Hence, supplier discounts for direct sales and
trade discounts for ST Kinetics will be available at 10%. In push strategy, ECO Bus will be
made available through direct sales and sale force teams at the showroom.
5.9 Advertising Primarily, advertising will be done on Google Adwords and Google Display network to
drive web traffic to ECO Transport corporate and product website. In addition, ECO
Transport would also advertise in trade magazines such as METRO, the oldest and largest
trade publication for transit and motorcoach businesses with full page colour advertisements
(FPFC), over a 5 months period from October 2017 onwards (Metro Media Kit 2017; Mass
Transit Media Kit 2017; Advertise to the Largest Transit Audience 2016). ECO Transport will
also place FPFC ads in the Public Transport International Publication that has a focus on the
Asia Pacific mass transit transport (Public Transport International Magazine 2014;
Advertisements – PTI magazine Rates 2017).
Apart from this, ECO Transport will also advertise in Mass Transit Daily, an e-Newsletter
by Mass Transit Magazine, reaching out to more than 13,000 mass transit leaders, taking up a
top medium rectangle within the e-newsletter over a 5 months period from October 2017
onwards (Figure 22).
Figure 22: Mass Transit Magazine, e-Newsletter
5.9.1 Copy Platform
The copy platform is divided into product characteristics, advertising objective, the target
market, competition and the statement of benefits.
5.9.2 Product Characteristics
The ECO Bus is a self-sustaining vehicle featuring sensor based solar panels on its roof and
fast charging technology to run an efficient bus fleet.
Comment [J4]: Is this effective targeting at bus operators?
30
5.9.3 Target Market
Major bus operators in the private sector and the Land Transport Authority of Singapore are
the primary target market in Singapore for the ECO Bus.
5.9.4 Competition Competition includes major European bus brands such as Volvo, MAN, Mercedes, Scania,
Alexander Dennis targeting the public bus sector, local manufacturers such as Liannex, SC
Auto, Soon Chow Corp, LexBuild and Chinese manufacturers such as Golden Dragon, Yu
tong, King Long, Higer, Zonda and BYD in the private sector.
5.9.5 Statement of benefits
ECO Bus is a superior technologically advanced vehicle that promises sustainable transport
solutions for bus procurers.
5.10 Personal Selling Plan
The ECO Bus sales force teams will undergo intensive product trainings to equip them with
knowledge of the product. The sales force teams tasked to market the ECO Bus would make
cold calls to potential clients to find out whether their operations are being met by current
vehicles. Through sales leads or enquiries, the sales teams are required to maintain a monthly
10% in sales leads or enquiries. They would then attempt to convert these into potential sales
by explaining how ECO Bus would benefit them in the long run and obtain the key decision
makers’ contact details to meet conduct sales pitch. In relation to concerns relating to ECO
Bus, the sales force would be able to address them confidently on the bus product and follow
up with prospective bus procurers. Product brochures will be provided and made available for
download via the product website. Sales targets, incentives will also be implemented to
motivate them to clinch sale deals.
5.11 Trade Promotion Plan
In the introductory phrase, ECO Transport will offer short-term promotional discount at 5%
prior to the launch date and quantity discount for large orders up to 10% for minimum of 100
buses order for direct orders. Trade discount of 5% will also be offered to ST Kinetics.
5.12 Public Relation Plan
The purpose of the public relations team is to establish a strong relationship between ECO
Transport, the media and the public. Although the general public are not the direc audience of
the target market, they are the end users of the vehicles. Hence, by creating favourable image
of the ECO Bus through the media, it would possibly build strong support for the demand of
ECO buses as bus operators would want to maintain a positive image in the eyes of the public.
The ECO Bus could participate in major public transport events or exhibitions where
members of the public would have a chance to catch a glimpse and gain first-hand experience
on board the vehicle. Through such effort, editorial coverage may be secured through the
mass media.
Press release and media kits would also be available for download through the microsite.
Interested members of the press would also be invited for press tours. On 31 October 2017,
government officials from the LTA, the Ministry of Transportation, private and public bus
procurers would be invited to the opening ceremony.
5.13 Social Media Platforms
Social Media presence will be limited to Facebook and LinkedIn. ECO Transport
acknowledges that the use of social media on Facebook is primarily to maintain a presence on
31
the virtual world, allowing members of the public to understand the ECO Bus. Its purpose is
not meant to target the audience of the potential market. On the other hand, the LinkedIn
platform is a social media network for business and professionals to connect. This would
allow potential clients who are interested on the ECO Bus to connect and possibly make sales
queries.
5.14 Website
The corporate website and microsite will be made intuitive to browse important information
concerning the company and its products. The navigation tabs would include a Home page,
technical specifications divided into subpages such as Battery, Range, Motor, Specifications
and an e-brochure Download tab. As potential client browses through the page, information is
presented in piecemeal with accompanying product graphics so that key unique selling points
are presented for ease of understanding.
6. Forecast and Budget
Based on the pricing strategy as detailed in section 5.6.2, and the various marketing activities
in section 5.5 to 5.14, the sales and gross margin forecast, marketing budget set aside over the
next three years from Year 2017 to Year 2021.
The following assumptions have been made in order to produce the forecast. The sales
forecast and budget are summarised in page 33 to 38 of this report.
6.1.1 Establishment Cost for Assembly plant and office
ECO Transport will establish an assembly plant with an area size of 5,761 sqm in 24 Tuas
Avenue 10 with a lease of 20 years. The land rent is at $7,960 monthly or $95,514.06 per
annum plus a building price upfront for 20 years of $5.1million and the details are included as
part of the Profit and Loss Forecast (Standard Factory Launch Lease Factsheet 2016; Standard
Factories 2016).
From November 2016 to October 2017, the company would incur a total of $5.3million in
total expenses which would breakeven by December 2017 should ECO Transport secure the
agreement with LTA to supply the vehicles.
6.1.2 Cost of Goods Sold
Cost of Goods sold consist of raw materials and the salaries of 10 assembly plant staff as well
as manufacturing overhead such as the salaries of 8 production managers and supervisors. The
assumption is that ECO Transport will enter into a formal contract to deliver 200 ECO buses
to LTA by December 2019 with monthly deliveries made.
6.1.3 Operating Expenses
6.1.3.1 Assembly Plant and related Expenses
At an automotive assembly plant, a vehicle can consume about 820 kWhr/vehicle in the
assembling process (Omar 2011, 54). As industrial electricity tariff is not publicly available, a
substitute based on residential electricity tariff at $19.13 per kWh is used as an estimate
(Singapore Power 2016). Additionally, monthly utility bill for air conditioning and lighting
amounts to $1,350; telephone bills at $400 and cost of operating machinery for assembling
parts at $15,686.60 during the development year. Meanwhile, audit and legal fees are based
on an estimated retainer fee of $4,000 per year. Other salary expenses relate to the cost of the
5 key directors in the Sales, Marketing, PR Finance and R&D departments and estimated
32
office staff of 16. All other costs are based on actual real-life scenario of setting up a
commercial office in Singapore and self explanatory based on the profit and loss forecast
(Costs of setting up an office in Singapore 2005). Starting from November 2017, as forecasted
orders increase, ECO Transport will invest in automotive robots to speed up on the
assembling of the vehicles. The average robot costs approximately SGD$173,000 and the
company looks to invest in 4 robots and move assembly towards automation (How much do
Industrial Robots Cost 2016). The company will employ the straight line depreciation on the
equipments over 20 years.
6.1.3.2 Market Research Budget
The purpose of the market research budget at earmarked expenditure of $500,000 is to
investigate the market potential of the ECO bus in comparison to current market offerings
and identify gaps in the market. It is also to identify whether the proposed price is reasonable
in light of the vehicle’s perceived benefits. In doing so, it would ensure that factors are
properly considered in the product development and commercialisation process. ECO
Transport would be engaging B2B International, a market research company that specialises
in B2B insights for the above purpose and concept testing (B2B International 2016).
6.1.3.3 Product Development Budget
The product development budget entails from design to prototyping. The budget of
$1.5million will be used for patent application, legal fees for intellectual property,
development of technical manuals and user training manuals and prototyping. The cost set
aside will also be used to offset payments for raw material and labour for the prototype. The
estimated cost for developing the prototype is at $1.25 million.
6.1.3.4 Media and Communications Budget
The breakdown for budget expenditure has been allocated into Public Relations (PR),
Advertising creative fees, PR agency fees, Print ad, Web ad, Google Advertising (SEO/SEM),
market research and setup for the corporate and product microsite. Overall, an estimated cost
of $275,400 will cover for the above purpose from 2016 to 2019.
During the official launch and the first 5 months, heavy investments are made on print ads in
specialised publications in conjunction with press release distribution, launch of the corporate
microsite, collateral distribution, public relations and online advertising.
Thereafter, from March 2018 onwards, the budget will focus primarily on online advertising
to drive sales leads and traffic to the corporate and microsite as the ECO Bus would have
achieved an established reputation in the market.
The allocation of the budget is as follows.
51.92% of budget will be allocated for Online Advertising (Google Advertising and
specialised B2B mass transit websites) to raise product awareness and drive web
traffic to corporate site.
1.82% of budget will be allocated for Corporate Site and Microsite Development.
36.1% of budget will be allocated for print advertisements in specialised trade
publications for the first five months from official launch.
5.45% of budget will be allocated for the purpose of press release distribution and
public relations matters.
1.82% of budget will be allocated for creative costs pertaining to Advertising and PR
Agency fees
Comment [J5]: Sufficient?
33
2.9% of budget will be allocated for collateral materials.
34
Twelve-month sales forecast ECO Transport (ECO BUS) Fiscal Year Begins Nov-17
Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Annual Totals
Current
Month
Ending
mm/yy 2016 2015 2014
Direct Sales - Sales Force 5 5 5 5 10 10 10 10 10 10 10 10 100
Sale price @ unit 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00
Direct Sales - Sales
Force TOTAL 8,550,000 8,550,000 8,550,000 8,550,000 17,100,000 17,100,000 17,100,000 17,100,000 17,100,000 17,100,000 17,100,000 17,100,000 171,000,000 0 0 0 0
Direct Sales - Website 0
Sale price @ unit
Direct Sales - Website
TOTAL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Exclusive Agent 0
Sale price @ unit
Exclusive Agent TOTAL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Monthly totals: All
Categories 8,550,000 8,550,000 8,550,000 8,550,000 17,100,000 17,100,000 17,100,000 17,100,000 17,100,000 17,100,000 17,100,000 17,100,000 $171,000,000.00 0 0 0 0
12-month Sales Forecast Sales History
Twelve-month sales forecast ECO Transport (ECO BUS) Fiscal Year Begins Nov-18
Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19
Annual
Totals
Current
Month
Ending
mm/yy 2017 2016 2015
Direct Sales - Sales Force 5 5 5 5 5 5 5 5 10 10 10 10 80 100
Sale price @ unit 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00
Direct Sales - Sales
Force TOTAL 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 17,100,000 17,100,000 17,100,000 17,100,000 136,800,000 0 171,000,000 0 0
Direct Sales - Website 0
Sale price @ unit
Direct Sales - Website
TOTAL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Exclusive Agent 0
Sale price @ unit
Exclusive Agent TOTAL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Monthly totals: All
Categories 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 17,100,000 17,100,000 17,100,000 17,100,000 136800000 0 171,000,000 0 0
12-month Sales Forecast Sales History
35
Twelve-month sales forecast ECO Transport (ECO BUS) Fiscal Year Begins Nov-19
Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20
Annual
Totals
Current
Month
Ending
mm/yy 2018 2017 2016
Direct Sales - Sales Force 10 10 20 80 100
Sale price @ unit 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00 1,710,000.00
Direct Sales - Sales
Force TOTAL 17,100,000 17,100,000 0 0 0 0 0 0 0 0 0 0 34,200,000 0 136,800,000 171,000,000 0
Direct Sales - Website 0
Sale price @ unit
Direct Sales - Website
TOTAL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Exclusive Agent 0
Sale price @ unit
Exclusive Agent TOTAL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Monthly totals: All
Categories 17,100,000 17,100,000 0 0 0 0 0 0 0 0 0 0 34200000 0 136,800,000 171,000,000 0
12-month Sales Forecast Sales History
36
Twelve-month profit and loss projection ECO Transport (S) Pte Ltd Fiscal Year Begins Nov-16
I N
D . %
N o v -1
6
% B
/A
D ec
-1 6
%
J an
-1 7
%
F e b -1
7
%
M a r-
1 7
%
A p r-
17
%
M a y-
1 7
%
J u n -1
7
%
J u l- 1 7
%
A u g -1
7
%
S e p -1
7
%
O c t-
1 7
%
Y E
A R
L Y
%
Revenue (Sales)
Direct Sales - Sales
Force 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 -
Direct Sales - Website - - - - - - - - - - - - -
Exclusive Agent - - - - - - - - - - - - -
Total Revenue (Sales) 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0
Cost of Sales
Raw Materials for
Prototype 628,728 - - - - - - - - - - - - 628,728 -
Assembly Plant Staff
Salaries for Prototype 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 360,000 -
Manufacturing Overhead
for Prototype 22,333 - 22,333 - 22,333 - 22,333 - 22,333 - 22,333 - 22,333 - 22,333 - 22,333 - 22,333 - 22,333 - 22,333 - 267,996 -
Total Cost of Sales 681,061 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 1,256,724 -
Gross Profit -681,061 - -52,333 - -52,333 - -52,333 - -52,333 - -52,333 - -52,333 - -52,333 - -52,333 - -52,333 - -52,333 - -52,333 - -1,256,724 -
Expenses
Salary expenses 81,500 - 81,500 - 81,500 - 81,500 - 81,500 - 81,500 - 81,500 - 81,500 - 81,500 - 81,500 - 81,500 - 81,500 - 978,000 -
Payroll expenses (CPF) 18,955 - 18,955 - 18,955 - 18,955 - 18,955 - 18,955 - 18,955 - 18,955 - 18,955 - 18,955 - 18,955 - 18,955 - 227,460 -
Market Research 83,333 - 41,667 - 41,667 - 41,667 - 41,667 - 41,667 - 41,667 - 41,667 - 41,667 - 41,667 - 41,667 - 0 - 500,000 -
Product Development -
Prototyping 681,061 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 52,333 - 1,256,724 -
Print Advertising 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 19,882 - 19,882 -
Web Advertising - Mass
Transit eNewsletter -
Top Medium Rectangle
300 x 250
- - - - - - - - - - - 1,599 - 1,599 -
Google Advertising -
estimated 5,000 - 5,000
Public Relations - - - - - - - - - - - 10,000 - 10,000 -
Advertising & PR Agency
Fees - - - - - - - - - - - 5,000 - 5,000 -
Brochure Printed
Material Cost - - - - - - - - - - - 8,000 - 8,000 -
PR - Press Release
Distribution - - - - - - - - - - - 5,000 - 5,000 -
Corporate & Microsite - - - - - - - - - - - 5,000 - 5,000 -
Land Rent 7,960 - 7,960 - 7,960 - 7,960 - 7,960 - 7,960 - 7,960 - 7,960 - 7,960 - 7,960 - 7,960 - 7,960 - 95,514 -
Building Rent 21,250 - 21,250 - 21,250 - 21,250 - 21,250 - 21,250 - 21,250 - 21,250 - 21,250 - 21,250 - 21,250 - 21,250 - 255,000 -
Telephone (5lines x $30) 100 - 100 - 400 - 400 - 400 - 400 - 400 - 400 - 400 - 400 - 400 - 400 - 4,200 -
Utilities 17,037 - 17,037 - 17,037 - 17,037 - 17,037 - 17,037 - 17,037 - 17,037 - 17,037 - 17,037 - 17,037 - 17,037 - 204,439 -
Legal Fees - Retainer 4,000 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 4,000 -
Auditor - estimated Fee 4,000 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 4,000 -
Fire Insurance 40,000 - 40,000 - 40,000 - 40,000 - 40,000 - 40,000 - 40,000 - 40,000 - 40,000 - 40,000 - 40,000 - 40,000 - 480,000 -
Depreciation - - - - - - - - - - - - -
Total Expenses 959,195 - 280,801 - 281,101 - 281,101 - 281,101 - 281,101 - 281,101 - 281,101 - 281,101 - 281,101 - 281,101 - 298,914 - 4,068,817 -
Net Profit -1,640,257 - -333,134 - -333,434 - -333,434 - -333,434 - -333,434 - -333,434 - -333,434 - -333,434 - -333,434 - -333,434 - -351,247 - -5,325,542 -
37
Twelve-month profit and loss projection ECO Transport (S) Pte Ltd Fiscal Year Begins Nov-17
I N
D . %
N o v -1
7
% B
/A
D ec
-1 7
%
J an
-1 8
%
F e b -1
8
%
M a r-
1 8
%
A p r-
18
%
M a y-
1 8
%
J u n -1
8
%
J u l- 1 8
%
A u g -1
8
%
S e p -1
8
%
O c t-
1 8
%
Y E
A R
L Y
%
Revenue (Sales)
Direct Sales - Sales
Force 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 171,000,000 100.0
Direct Sales - Website 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Exclusive Agent 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total Revenue (Sales) 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 171,000,000 100.0
Cost of Sales
Raw Materials 3,143,641 36.8 3,143,641 36.8 3,143,641 36.8 3,143,641 36.8 6,287,281 36.8 6,287,281 36.8 6,287,281 36.8 6,287,281 36.8 6,287,281 36.8 6,287,281 36.8 6,287,281 36.8 6,287,281 36.8 62,872,813 36.8
Assembly Plant Staff
Salaries 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 360,000 -
Manufacturing Overhead 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 730,392 -
Total Cost of Sales 3,234,507 37.8 3,234,507 37.8 3,234,507 37.8 3,234,507 37.8 6,378,147 37.3 6,378,147 37.3 6,378,147 37.3 6,378,147 37.3 6,378,147 37.3 6,378,147 37.3 6,378,147 37.3 6,378,147 37.3 63,963,205 37.4
Gross Profit 5,315,493 62.2 5,315,493 62.2 5,315,493 62.2 5,315,493 62.2 10,721,853 62.7 10,721,853 62.7 10,721,853 62.7 10,721,853 62.7 10,721,853 62.7 10,721,853 62.7 10,721,853 62.7 10,721,853 62.7 107,036,795 62.6
Expenses
Salary expenses 81,500 1.0 81,500 1.0 81,500 1.0 81,500 1.0 81,500 0.5 81,500 0.5 81,500 0.5 81,500 0.5 81,500 0.5 81,500 0.5 81,500 0.5 81,500 0.5 978,000 0.6
Payroll expenses (CPF) 13,855 0.2 13,855 0.2 13,855 0.2 13,855 0.2 13,855 0.1 13,855 0.1 13,855 0.1 13,855 0.1 13,855 0.1 13,855 0.1 13,855 0.1 13,855 0.1 166,260 0.1
Print Advertising 19,882 0.2 19,882 0.2 19,882 0.2 19,882 0.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 79,527 0.0
Web Advertising - Mass
Transit eNewsletter -
Top Medium Rectangle
300 x 250
1,599 0.0 1,599 0.0 1,599 0.0 1,599 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6,394 0.0
Google Advertising (SEO
/ SEM) 5,000 0.1 5,000 0.1 5,000 0.1 5,000 0.1 5,000 0.0 5,000 0.0 5,000 0.0 5,000 0.0 5,000 0.0 5,000 0.0 5,000 0.0 5,000 0.0 60,000 0.0
Corporate & Microsite 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Land Rent 7,960 0.1 7,960 0.1 7,960 0.1 7,960 0.1 7,960 0.0 7,960 0.0 7,960 0.0 7,960 0.0 7,960 0.0 7,960 0.0 7,960 0.0 7,960 0.0 95,514 0.1
Building Rent 21,250 0.2 21,250 0.2 21,250 0.2 21,250 0.2 21,250 0.1 21,250 0.1 21,250 0.1 21,250 0.1 21,250 0.1 21,250 0.1 21,250 0.1 21,250 0.1 255,000 0.1
Telephone (5lines x $30) 100 0.0 100 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 4,200 0.0
Utilities 17,037 0.2 17,037 0.2 17,037 0.2 17,037 0.2 17,037 0.1 17,037 0.1 17,037 0.1 17,037 0.1 17,037 0.1 17,037 0.1 17,037 0.1 17,037 0.1 204,439 0.1
Legal Fees - Retainer 4,000 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 4,000 0.0
Auditor - estimated Fee 4,000 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 4,000 0.0
Fire Insurance 40,000 0.5 40,000 0.5 40,000 0.5 40,000 0.5 40,000 0.2 40,000 0.2 40,000 0.2 40,000 0.2 40,000 0.2 40,000 0.2 40,000 0.2 40,000 0.2 480,000 0.3
Assembly Robots x 4 692,000 8.1 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 692,000 0.4
Assembly Robot
Depreciation 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 34,600 0.0
Total Expenses 911,065 10.7 211,065 2.5 211,365 2.5 211,365 2.5 189,884 1.1 189,884 1.1 189,884 1.1 189,884 1.1 189,884 1.1 189,884 1.1 189,884 1.1 189,884 1.1 3,063,934 1.8
Net Profit 4,404,429 51.5 5,104,429 59.7 5,104,129 59.7 5,104,129 59.7 10,531,968 61.6 10,531,968 61.6 10,531,968 61.6 10,531,968 61.6 10,531,968 61.6 10,531,968 61.6 10,531,968 61.6 10,531,968 61.6 103,972,861 60.8
38
Twelve-month profit and loss projection ECO Transport (S) Pte Ltd Fiscal Year Begins Nov-18
I N
D . %
N o v -1
8
% B
/A
D ec
-1 8
%
J an
-1 9
%
F e b -1
9
%
M a r-
1 9
%
A p r-
19
%
M a y-
1 9
%
J u n -1
9
%
J u l- 1 9
%
A u g -1
9
%
S e p -1
9
%
O c t-
1 9
%
Y E
A R
L Y
%
Revenue (Sales)
Direct Sales - Sales
Force 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 136,800,000 100.0
Direct Sales - Website 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Exclusive Agent 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total Revenue (Sales) 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 8,550,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 17,100,000 100.0 136,800,000 100.0
Cost of Sales
Raw Materials 3,143,641 36.8 3,143,641 36.8 3,143,641 36.8 3,143,641 36.8 3,143,641 36.8 3,143,641 36.8 3,143,641 36.8 3,143,641 36.8 6,287,281 36.8 6,287,281 36.8 6,287,281 36.8 6,287,281 36.8 50,298,250 36.8
Assembly Plant Staff
Salaries 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 30,000 - 360,000 -
Manufacturing Overhead 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 60,866 - 730,392 -
Total Cost of Sales 3,234,507 37.8 3,234,507 37.8 3,234,507 37.8 3,234,507 37.8 3,234,507 37.8 3,234,507 37.8 3,234,507 37.8 3,234,507 37.8 6,378,147 37.3 6,378,147 37.3 6,378,147 37.3 6,378,147 37.3 51,388,642 37.6
Gross Profit 5,315,493 62.2 5,315,493 62.2 5,315,493 62.2 5,315,493 62.2 5,315,493 62.2 5,315,493 62.2 5,315,493 62.2 5,315,493 62.2 10,721,853 62.7 10,721,853 62.7 10,721,853 62.7 10,721,853 62.7 85,411,358 62.4
Expenses
Salary expenses 81,500 1.0 81,500 1.0 81,500 1.0 81,500 1.0 81,500 1.0 81,500 1.0 81,500 1.0 81,500 1.0 81,500 0.5 81,500 0.5 81,500 0.5 81,500 0.5 978,000 0.7
Payroll expenses (CPF) 13,855 0.2 13,855 0.2 13,855 0.2 13,855 0.2 13,855 0.2 13,855 0.2 13,855 0.2 13,855 0.2 13,855 0.1 13,855 0.1 13,855 0.1 13,855 0.1 166,260 0.1
Google Advertising (SEO
/ SEM) 5,000 0.1 5,000 0.1 5,000 0.1 5,000 0.1 5,000 0.1 5,000 0.1 5,000 0.1 5,000 0.1 5,000 0.0 5,000 0.0 5,000 0.0 5,000 0.0 60,000 0.0
Corporate & Microsite 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Land Rent 7,960 0.1 7,960 0.1 7,960 0.1 7,960 0.1 7,960 0.1 7,960 0.1 7,960 0.1 7,960 0.1 7,960 0.0 7,960 0.0 7,960 0.0 7,960 0.0 95,514 0.1
Building Rent 21,250 0.2 21,250 0.2 21,250 0.2 21,250 0.2 21,250 0.2 21,250 0.2 21,250 0.2 21,250 0.2 21,250 0.1 21,250 0.1 21,250 0.1 21,250 0.1 255,000 0.2
Telephone (5lines x $30) 100 0.0 100 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 400 0.0 4,200 0.0
Utilities 17,037 0.2 17,037 0.2 17,037 0.2 17,037 0.2 17,037 0.2 17,037 0.2 17,037 0.2 17,037 0.2 17,037 0.1 17,037 0.1 17,037 0.1 17,037 0.1 204,439 0.1
Legal Fees - Retainer 4,000 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 4,000 0.0
Auditor - estimated Fee 4,000 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 4,000 0.0
Fire Insurance 40,000 0.5 40,000 0.5 40,000 0.5 40,000 0.5 40,000 0.5 40,000 0.5 40,000 0.5 40,000 0.5 40,000 0.2 40,000 0.2 40,000 0.2 40,000 0.2 480,000 0.4
Assembly Robots x 4 692,000 8.1 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 692,000 0.5
Assembly Robot
Depreciation 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 2,883 0.0 34,600 0.0
Total Expenses 889,584 10.4 189,584 2.2 189,884 2.2 189,884 2.2 189,884 2.2 189,884 2.2 189,884 2.2 189,884 2.2 189,884 1.1 189,884 1.1 189,884 1.1 189,884 1.1 2,978,013 2.2
Net Profit 4,425,909 51.8 5,125,909 60.0 5,125,609 59.9 5,125,609 59.9 5,125,609 59.9 5,125,609 59.9 5,125,609 59.9 5,125,609 59.9 10,531,968 61.6 10,531,968 61.6 10,531,968 61.6 10,531,968 61.6 82,433,344 60.3
39
Twelve-month profit and loss projection ECO Transport (S) Pte Ltd Fiscal Year Begins Nov-19
I N
D . %
N o v -1
9
% B
/A
D ec
-1 9
%
J an
-2 0
%
F e b -2
0
%
M a r-
2 0
%
A p r-
20
%
M a y-
2 0
%
J u n -2
0
%
J u l- 2 0
%
A u g -2
0
%
S e p -2
0
%
O c t-
2 0
%
Y E
A R
L Y
%
Revenue (Sales)
Direct Sales - Sales
Force 17,100,000 100.0 17,100,000 100.0 - - - - - - - - - - 34,200,000 100.0
Direct Sales - Website 0.0 0.0 - - - - - - - - - - 0.0
Exclusive Agent 0.0 0.0 - - - - - - - - - - 0.0
Total Revenue (Sales) 17,100,000 100.0 17,100,000 100.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 34,200,000 100.0
Cost of Sales
Raw Materials 3,143,641 18.4 3,143,641 18.4 - - - - - - - - - - 6,287,281 18.4
Assembly Plant Staff
Salaries 30,000 - 30,000 - - - - - - - - - - - 60,000 -
Manufacturing Overhead 60,866 - 60,866 - - - - - - - - - - - 121,732 -
Total Cost of Sales 3,234,507 18.9 3,234,507 18.9 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 6,469,013 18.9
Gross Profit 13,865,493 81.1 13,865,493 81.1 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 27,730,987 81.1
Expenses
Salary expenses 81,500 0.5 81,500 0.5 - - - - - - - - - - 163,000 0.5
Payroll expenses (CPF) 13,855 0.1 13,855 0.1 - - - - - - - - - - 27,710 0.1
Google Advertising (SEO
/ SEM) 5,000 0.0 5,000 0.0 - - - - - - - - - - 10,000 0.0
Corporate & Microsite 0.0 0.0 - - - - - - - - - - 0.0
Land Rent 7,960 0.0 7,960 0.0 - - - - - - - - - - 15,919 0.0
Building Rent 21,250 0.1 21,250 0.1 - - - - - - - - - - 42,500 0.1
Telephone (5lines x $30) 100 0.0 100 0.0 - - - - - - - - - - 200 0.0
Utilities 17,037 0.1 17,037 0.1 - - - - - - - - - - 34,073 0.1
Legal Fees - Retainer 4,000 0.0 0 0.0 - - - - - - - - - - 4,000 0.0
Auditor - estimated Fee 4,000 0.0 0 0.0 - - - - - - - - - - 4,000 0.0
Fire Insurance 40,000 0.2 40,000 0.2 - - - - - - - - - - 80,000 0.2
Assembly Robots x 4 692,000 4.0 0 0.0 - - - - - - - - - - 692,000 2.0
Assembly Robot
Depreciation 2,883 0.0 2,883 0.0 - - - - - - - - - - 5,767 0.0
Total Expenses 889,584 5.2 189,584 1.1 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 1,079,169 3.2
Net Profit 12,975,909 75.9 13,675,909 80.0 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 26,651,818 77.9
40
7. Implementation and Control
7.1 Organisational Chart
As a new start-up, ECO Transport will follow the structure of a functional organisation
(Figure 23). The key reason is that centralised and formal control is necessary in order to keep
checks on the progress of the company. For a single product, the project is managed by
coordination across functions. The company is divided among different functions with their
respective specialisations. Each function or department is lead by their individual directors.
Figure 23: Organisation Chart, ECO Transport
7.2 Information / Operational Control Dashboards
An information dashboard empowers those who utilise it to be conscious and be on top of
things. The development of operational control dashboards will primarily be used to monitor
key marketing functional teams such as Public Relations, Marketing and Advertising to
collaborate on the media and communication budgets and keep approved budget spending on
target as well as to measure the return on investments. The dashboards for the various
functional teams are developed as follows.
7.2.1 Digital Marketing Dashboard
As part of the Marketing department, the digital marketing team will play an important role in
driving traffic to the corporate and product microsite to generate leads for the sales teams.
Moreover, with 51.92% of the media communications budget allocated to them, it is crucial
that their effect are monitored and measured.
The key performance indicators (KPI) or metrics are primarily lead generation and web
analytics metrics to understand traffic sources such as number of sessions for the month, what
is the conversion rate from visitors to making an enquiry, unique visitors to site, average
timespan on site and percentage of visitors who leave the first page after browsing divided in
the various forms of search. These performance metrics will help to provide a gauge on the
effort of the team that ECO Transport is investing in for online advertising (Figure 24).
41
Figure 24: Digital Marketing Dashboard
7.2.2 Marketing Performance Dashboard
Another important marketing performance dashboard for strategic control would breakdown
the progression in the lead funnel (Figure 25). For instance, the captured lead indicates 3% of
the web visits are potential leads for the sales teams to follow through. Through follow-up
actions, the sales team would then be able to assess how qualify a potential customer is before
leading to an actual sales. Another important metric in the dashboard would indicate how
much of revenue is generated from which channel, such as through personal selling by sales
force, corporate site or through the exclusive agent for ECO Bus. These are presented in the
form of a sales analysis that enables key decision markers to know where the main leads are
coming from and the size or type of customer
Figure 25: Marketing Performance Dashboard
42
8. Contingency Plan
Uncertain market conditions and financial struggles are some of the challenges and risks
when starting a new business as internal and external environment are always changing at a
fast pace. Therefore, it is essential to determine the types of risks that will affect the business
so that possible contingencies can be planned to ensure the sustainability and continuity of the
business (Simpkins 2009, 106). In this section, possible contingencies that the ECO Bus
product may encounter are planned for, with triggers set and specific alternative response
options indicated to react.
8.1 Revenue exceeds projection In this situation, this is considered a ‘good problem’ as it indicates a high demand for the
ECO bus. However, should such a scenario occurs, ECO Transport will have to look at the
possibility of having components assembled in an outsourced agreement to meet demand.
8.2 Revenue fall short from projection
ECO Transport would have to review its sales forecast and pricing policies for the ECO bus.
If revenue does not meet the projection, we can implement the idea on other vehicle types
such as on cars and motorcycle to reach out to more target market instead of just focusing on
the bus manufacturing industry.
8.3 Failure to secure a major contract deal
The failure to secure a major contract deal with LTA would pose significant implications for
ECO Transport, given its dominance as a customer in the bus market. ECO Transport would
have to bring forward its plans for overseas expansion in order for it to grow. Alternatively,
ECO Transport will target the local private bus market.
8.4 Product Failure Full scale product failure is unlikely. However, issues with raw material components such as
electrical batteries, solar panels and bus prefabricated parts must be quickly resolved to avoid
delays in assembly and delivery of end products. This calls for maintain strong relationship
with multiple suppliers instead of strong dependence on one so that alternative suppliers can
be considered.
8.5 Financial Risks
Internal risks such as cash flow shortages or insufficient funding due to cost overrun for the
business may happen should the company fail to project adequately on required funds. The
company may have to take on debt financing for the short term.
8.6 Threat of entry by competitors with similar product ECO Transport will maintain its current marketing strategy even with the entry of competitors
such as BYD. However, the company will closely monitor the pricing and promotion plans
and sales results before considering its next move.
43
9. Group Activity Records
GROUP ACTIVITY RECORD (Tutor: Jack Ng)
Group Project Title:
Tutorial day and
time:
Thursday, 1900
hours
Meeting Date: 29/9/2016 Meeting time: 2200 hours
Group Members
Present:
ChengHui (Calvin), Shi Hui (Vivian), Pei Ru,
Melissa
Group Members
Absent:
Members Name Signature Agreed Actions Due Date
Calvin
- Company Profile
- Product / Business Idea
- Market Analysis
- Porter’s Five Forces
Analysis
13/10/2016
Vivian
- SWOT Analysis
- Company Profile
- Product / Business Idea
13/10/2016
Pei Ru
Macro-Environment
Trends
supporting ECO Bus
(PESTEL)
13/10/2016
Melissa
- Marketing Strategy
- Drawings of buses, panels
and engines
- Marketing visuals
13/10/2016
You are accountable for the agreed actions that you have signed for. Submit all Group
Activitiy Records with appropriate group report.
Comments:
Next Meeting Date: 20/10/2016
Next Meeting Time: 2200
hours
44
GROUP ACTIVITY RECORD (Tutor: Jack Ng)
Group Project
Title:
Tutorial day and
time:
Thursday, 1900
hours
Meeting Date:
20/10/2016
Meeting time: 2200
hours
Group Members
Present:
ChengHui (Calvin), Shi Hui (Vivian),
Pei Ru, Melissa
Group Members
Absent:
Members Name Signature Agreed Actions Due Date
Calvin
- Compiling all
sections 27/10/2016
Vivian
- Contingency plans
- Referencing 27/10/2016
Pei Ru
- Forecast &
budgeting 13/10/2016
Melissa
- Marketing visuals 13/10/2016
You are accountable for the agreed actions that you have signed for. Submit all
Group Activitiy Records with appropriate group report.
45
10. Appendices
ECO Transport Company Logo and Tagline
ECO Transport Facebook Business Page
46
Sensor based solar panels on bus roof
47
48
Concept Bus
49
ECO Transport Corporate Site
Beta version at http://ruverecalvin.wixsite.com/website
50
51
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