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How iPark can help?
Approaching U.S. Retailers 2004.05.10 Kevin Lee iPark Silicon Valley [email protected] iPark Silicon Valley Overview Establishment: - Established in April 2000 Facilities: - 5 acre grounds (5000 Pyung), Building area: 54,000 ft2 (1520 Pyung) - 70+ offices; conference rooms, seminar & training facilities Large (1) / medium (1) / small (2) conference rooms, Seminar and Training Room 64 offices, 24 cubicles for tenant companies Management: - Professional Executives US Industry experience Experienced in US IT bilingual, bi-cultural business practices Resident Portfolio Companies: - 30 resident portfolio companies 24 Acceleration center, 3 SSF, 3 BC 144 client employees iParkSV Sweet Spot New New growth growth engines, engines, maximize maximize Korean Korean IT IT core core competency competency Embedded S/W (Hardware Based) Intelligent Home Networking & server Appliance/Media servers Consumer Electronics Post PCs IT SoC Packaged S/W VPN Security Software Linux based packaged S/W System Integration e-Gov’t Solutions to Latin America Mobile/Telecom Integration POS solutions ODC (Off-shore Development Center) R&D center in Korea US MARKET Opportunities Digital Contents Games Online Mobile Network Console RETAIL SWEET SPOT PRODUCTS - LCD / Plasma TV Electronics - MP3 players - Home/portable DVD - TWR - Digital Cameras - Hi-Fi - DVR / CCTV - Video phones - Console Games & accessories Wireless Technology - GPS - GSM / CDMA - USB dongle - Wireless LAN - Bluetooth Packaged Software - Security & Anti-Virus Software - JAVA base office suites - Web development S/W MARKET Demand Computer Peripherals -PDA - Scanners - USB HDD / flash drives - DVD RW - Flash Reader - LCD monitors Steps to enter the market Korean IT companies need results in a fast, cost effective manner. Unfortunately, these steps can’t be skipped, takes time and money. Set up MKTG & Target the right Penetrate Sales operations market segments proper channels Close deals Revenue growth Why Korean Companies failed? How iPark can help? Every Step Can Be A CHASM Unless Obstacles are Removed Set up MKTG & Sales operations • • • • • • Localization Packaging Local Operation & Offices Local Staffing Support Infrastructure Value Chain Understanding Target the right market segments • Competitive Analysis • Identifying penetration segment • Differentiators • Product Positioning • Market driven Pricing Penetrate proper channels • • • • • Close deals Tactical Channel Plan Revenue growth • HQ Support for Deals Setting up Sales Team • Incentive Management Channel Networking Promotion Training of Support Team • Introductory PR • Trade Shows • Incentive Schedule Most Korean IT companies failed to cross the chasm in the US. TYPES OF RETAILERS Mass Merchants Catalog Retailers e-tailers DISTRIBUTION Tier1 distributors Manufacturer …etc. Tier2 wholesalers & importers & (VSP:Value Service Provider) Resellers Resellers $ CONSUMERS APPROACHING THE RETAILERS Tier1 Distribution SKU is the Most Preferable Most mass merchants prefer Tier1 distribution Size of the supplier matters Logistics plays an important role in buying decisions A huge leveraging point when approaching the mass merchants ..... APPROACHING THE RETAILERS Retailer Competition Availability Price Incentive Programs Customer Service Financing Programs No. of Sales People Product Expertise Marketing Store Appearance & Navigat ion APPROACHING THE RETAILERS What retailers expect from the suppliers Availability Retailers run tight inventory system 15% to 20% of total order in mfr. warehouse Marketing Power demand generation Services & Support Local RMA and Technical Flexible Terms Net45 to Net60 days Favorable Return Policy Up to 90days RMA handling fee Price Protection Rebate Programs PREPARING FOR THE RETAILS Ask yourself questions How do I compete in such crowded marketplace? Why should U.S. retailers sell my product? How do I reach those target retailers? What is the benefit of my product & service? What is my method of distribution? What are my standard terms & conditions? Is my MSRP competitive? Margin structure? What is my promotional plan for my product? How should I establish local logistics? PREPARING FOR THE RETAILS Acknowledge Your Hurdles – General Most mass merchandisers prefer Tier1 distribution Retailers are reluctant to establish new vendor accounts Vendor qualification is timely & tedious process Existing vendors have the priority New product reviews New business opportunities Distributed decision making Lengthy decision cycles; 6-12 Months Dilution effect Local logistics & service management Competition PREPARING FOR THE RETAILS Acknowledge Your Hurdles–Financial(1) Price Protection 3party product is the vendor’s core component Vendor offers discounts or reduced price to others Payment Terms Net60days from the receiving date Volume Incentive Rebate Quarterly basis (2-5)% of total purchase Co-op Funds Vendor provides (3-7)% of co-op funds to promote sales Source: X retailer 2003 agreement PREPARING FOR THE RETAILS Acknowledge Your Hurdles–Financial(2) MDF: Vendor provides minimum of X% or $X annually Launch Funds Vendor provides ($25K-250K) of one time launch fund Returns Vendor provides RMA handling fee of up to 7% for defective, exchange, cash refunds Sample Product Vendor provides no-charge sample products for sales training, tradeshow, product reviews. Sample products are not returned to the vendor. Source: X retailer 2003 agreement PREPARING FOR THE RETAILS Be persistent with your brand messages Slogan Colors Logos Cool brand name (not SKU) Carry at least 3 models Retailers compete Circuit City vs. Good Guys Fry’ Electronics vs. CompUSA PC Connection vs. Tiger Direct PREPARING FOR THE RETAILS Build Your Business Plan Retail Focus Marketing Plan & Budget Financing Plan Availability Local Service & Support Logistics Quality Assurance (certifications) Full understanding of the competition Pricing Structure Margin & Incentives Structure Revenue Goal Commitment For more information about writing U.S. business plan visit iPark SV resources page at: http://www.iparksv.com/services/it_resources.html Document: writing an effective business plan E-TAILERS E-TAILERS ..... Why are they important? E-TAILERS May not be the volume driver but… You can leverage their search engine enhancements Will gain exposure to millions of Internet shoppers Will work as your effective marketing tool Will be your stepping stone for branding Your target mass merchandisers will hear the noise Be on e-tailers’ Websites Easier to approach Exposure is the key return Less financial burden E-TAILERS A2Z Computers www.a2zcomp.com Global Supersale www.globalsupersale.com PC Nation www.pcnation.com Avlogic www.avlogic.com Good Deal PC www.gooddealpc.com PC Universe www.pcuniverse.com Axion Tech www.axiontech.com Harmony Computer www.shopharmony.com Provantage www.provantage.com Buy.com www.buy.com HM Computer www.hmcomputer.com Secure Mart www.securemart.com BuyDig.com www.buydig.com J&R www.jandr.com Shopper Wiz www.shopperwiz.com CDW www.cdw.com LACC.com www.lacc.com TCWO www.tcwo.com Chumbo.com www.chumbo.com www.techonweb.com www.clubmac.com www.micer.com TechOnWeb.com Club Mac Micer www.thenerds.net www.compuadds.com www.emicrox.com TheNerds.net CompuAdds.com Micro X-press www.tigerdirect.com www.computergiants.com www.mobileplanet.com Tiger Direct Computer Giants Mobile Planet www.upgradesource.com www.computers4sure.com www.mpsuperstore.com Upgrade Source Computers4sure.com MP Superstore www.winlandcomputer.com www.compuvest.com www.mwave.com Winland Compuvest.com Mwave.com www.wiredzone.com www.costcentral.com www.netistech.net Wired Zone CostCentral.com Netis www.buyxg.com www.ebuyer.com www.newegg.com Xtreme Gear Ebuyer.com New Egg www.yesmicro.com www.ecost.com www.niceelectronics.com Yes Micro Ecost.com Nice Electronics www.zipzoomfly.com www.etronics.com www.pagecomputer.com ZipZoomFly Etronics Page Computer Zones www.zones.com PC Connection www.pcconnection.com PC Mall www.pcmall.com Future Power PC www.futurepowerpc.com Product Categories: Systems, HW, SW, PC peripherals, Audio, Video, Networking, Storage, Multimedia, Electronics, PDP, Hi-Fi, Digitals, Games, Accessories HOW iPark SV CAN HELP HOW iPark SV CAN HELP Leverage iPark’s Retail Channel Contacts Top U.S. mass merchandisers Tier1 distribution Tier2 distribution Massive pool of e-tailers Leverage iPark’s Retail Logistics Experience Know what to expect Be advanced in preparation Identify the right channels Massive pool of e-tailers direct contacts ALL ADDS TO A JUMP START HOW iPark SV CAN HELP Recent iPark sponsored retail marketing event Retail Vision (April 26 ~ 29, 2004) 175 retailers (top buyers) 3 Tier1 distribution companies (logistics) 350 vendors (manufacturers & suppliers) 5 iPark portfolio companies Global Hauri (anti-virus) Haansoft (office suite) Oracom (mp3) Fingersystem (memory pen) Encross (LCD TV) www.retailvision.com HOW iPark SV CAN HELP Retail Vision result Successful iPark promotion & networking iPark promotion to 175 top retailers in U.S. Established dialogues for product partnerships Strengthened retail channels to assist Korean IT vendors Held 70 private business meetings between iPark SV portfolio companies & retail buyers Performed 10 boardroom business presentations to groups of r etail buyers (each group consists of 15 target retailers) iPark & its portfolio companies have numerous prescheduled post-event meetings & follow ups to accelerate their current b usiness Priceless Retail Vision Award by iPark portfolio company www.retailvision.com ACHIEVEMENT Global Hauri receives BEST SW PRODUCT AWARD NOMINEES Computer Associates Global Hauri Jasc Software Susteen You Software Roles, Priority, Value-Add from iParksv Help Top Tier company in the target industry cross the chasm… Build the success model rest of the whole industry can follow Set up MKTG & Sales presence iPark Involvement Success model exists at ipark Target the right Penetrate Market segments proper channels Close deals Revenue growth Higher Value Bigger Impact Repeatable Industry Expertise Success model not exist yet IT Company Involvement Portfolio Company Selection New Addition in 2004: Mtekvision, Namo, Haansoft, Netpia Product Readiness • • • • • • Market Readiness • • • Financial Stability • • Differentiator Mature products Localization Ready for US Launch Success Potential within 18 months P&L for 6Q Funding source & investment plan CEO Commitment • • • • Marketing plan Channel Penetration Plan Demand Generation Plan Support Plan Prepared for Logistics CEO’s Vision Management track records Willing to hire local professionals Willing to track the metric with KIPA/iPark Contact: iPark Silicon Valley For help you can contact: Eric Lee, [email protected] Business Development Manager, Retail/Embedded Software (408) 432-5073 iPark Silicon Valley www.iparksv.com (408) 432-5000 Kevin Lee, [email protected] Mission – iPark Silicon Valley “Our mission is to establish and promote thriving partnerships between U.S. IT channels & Korean IT client companies, and provide an effective gateway for Korean IT companies to successfully penetrate the United States marketplace.” Thank you! www.iparksv.com
