Appendix B | BUSINESS PLAN FOR A MANUFACTURING BUSINESS | 237The Kinet-O-Scope: The Kinet-O-Scope features a small-sized screen which
produces optic displays in response to the human voice, music, and other sounds.
The display is in full color and the patterns created in response to sound are stunning.
It is particularly attractive to young children experimenting with the sound of their
own voice, although this is by no means the only market. People who love music, for
example, are commonly fascinated by the Kinet-O-Scope. To accurately estimate the
sales potential of the Kinet-O-Scope in the consumer market is difficult, as no directly
comparable products exist.
In an effort to arrive at as accurate an estimate as possible, extensive consumer
interviews were conducted. The Kinet-O-Scope Market Research Chart that follows
summarizes the results of these interviews. When compared directly with the most
similar products available (these are not nearly as good, but there is nothing else), 56%
of the people asked preferred the Kinet-O-Scope. Even more persuasive, 49% of those
tested would buy it for themselves, while 62% of those tested would buy it for a gift.
While there are no specific competitive products to the Kinet-O-Scope, it is clear
that there is a distinct market for products of this type. This conclusion is arrived at by
looking at good sales figures for Light Organs, Infinity Lights, Wave Devices, Volcano
Lights, Rain Lamps, and other products which use light in innovative and creative
ways.
Perhaps the best example of the size of the market is the Lava Light, a less
technically advanced, but lower-cost product. According to its manufacturer,
Volcano Simplex International, over 6,000,000 units have been sold in four years, with
3,000,000 sold last year. If we consider a wholesale average selling price of $90, this
represents over $270,000,000.
DAY INTERNATIONAL, INC., conservatively estimates that it will sell about 2,800
units of the Kinet-O-Scope in the second year of operations, for a wholesale dollar
sales volume of $420,000 ($150 per unit). Further sales growth is expected in later
years. Note that this unit volume is a tiny fraction of the Volcano Light’s sales volume
for last year.
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