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Todd, West, and Associates

Market Segmentation

Automated Data Collection (ADC) products and services is a $3 billion industry. The products are used in numerous companies with significant inventory and warehouse space. Approximately, 30% of the market is in wireless products and services but the demand is growing. It is estimated that wireless ADC products will dominate the market by 2005. Two of the industry leaders, Symbol and CDS, exceeded $600 million in sales for FY 2000. Wireless products represented 28% of their total sales.

Typically, with the installation of wireless products, there are associated costs for networking and connectivity issues. Most companies in the industry offer these additional services to their customers or outsource the service to engineering firms with expertise in their product line.

Todd, West, and Associates has extensive experience with both Symbol and CDS products. The company’s focus is to first meet the demands of the Symbol and CDS referred customers. Todd, West, and Associates will establish relationships with these companies and will work to receive referral business from them over time. The company estimates that 80% of revenues will come from outsourced clientele and 20% from new business. Over the next three years, Todd, West, and Associates estimates that new business will constitute 40% of revenue.

Computer engineering business plan, market segmentation chart image

Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
Outsourced Customers 10% 2,000 2,200 2,420 2,662 2,928 10.00%
New Customers 5% 10,000 10,500 11,025 11,576 12,155 5.00%
Total 5.88% 12,000 12,700 13,445 14,238 15,083 5.88%