INNOVATION

MANAGEMENT
MPU3242
Generico Inc.
Business plan
Prepared by:
Ariff Luqman Bin Peter 62212220297
Farhana Bt Muhammed Farish 62214220156
Mohamad Azamuddin Bin Syehran 62212119113
Muhammad As-siddiq Bin Mohd Rais 62213119651

Prepared for:
Dr. Firdaus Hilmi Nazri
Section 1:
Executive Summary
Generico, Inc. was formed in April 1999 to develop, manufacture and market a flexible
product line of highly cost-effective assembly robots. Generico’s initial product, the
Automation 10 and Automation 20. It uses solar as an energy source and can have
eco-friendly solar storage technology. It has a positive effect on the industrial sector
to protect the environment from further pollution by substances that adversely affect
the environment. It specifically at printed circuit board manufacturers. In addition, it
is one that makes full use of the functions of robots in replacing human energy. It will
help the manufacturing sector and manufacturing processes to be more effective and
efficient while maintaining environmental sustainability around the world.

Generico Inc is seeking paid-up capital $USD 5 million in funding from potential
investors. The funding will allow the organization to expand its product offering,
execute forceful deals and advertising plans, and establish a fundamental assembling
office. The organization anticipates that the initial round will be sufficient to get it to
competitiveness and allow it to construct capital to the point that outside obligation
financing can be obtained to help promote growth .
Section 2:
Business
Description
A. General description
of business
Generico Inc is a manufacturing firm that produces products with the concept of robotic functions and in long-
term company research and development (R&D), experts and engineers have upgraded Automation 10 and
Automation 20 products by adding solar functions as a source of energy to the product instead of relying on
entirely to electricity and manpower. In addition, the Automation 10 products that Generico Inc offers are eco-
firendly oriented products to prospects. This is because the manufacturing sector is one of the sectors that are
the cause of the disruption of the global ecosystem. Here, it promotes more environmentally friendly systems,
cost reduction and fully robotic systems without manpower.

The manufacturing industry intends to provide factory with custom and predesigned robotic
equipment for storing and retrieving products electronically via a computer system. Companies will
have more control over their goods in storage if they use electronic equipment and computers to
control manufacturing. A robotics solution would allow manufacturing companies to reduce not only
the amount of missing or destroyed goods, but also the factory's staffing requirements and labor
intensity.

Automation 10 and Automation 20 design will create a consulting and technical service to assist
production managers in making sound business decisions, in addition to the application design of
robotic products.
 • The target market for Generico Inc is the small to
medium-sized circuit board manufacturers industry
globally. Traditionally, these factories relied on human
labor to finish and least computerize system the
products. Also, it produced limited output rather than
using Automation 10 and Automation 20. These

B. Industry
procedures have remained largely unchanged to the
present day. The most recent advancement in the
industry has been the use of computers and database

Background systems for monitoring and control the quality of the

circuit board. This means that the industry is ripe for
productivity improvements, with all the available
technologies to automate the manufacturing circuit
board, storing, stocking and retrieval system. Also, it
can prevent from dump of defect circuit board that can
burden the company financially.
C. Goals and potential of
the business and milestones.
Goal for the short term (Mission) is to increase the use of system
robotics in circuit board production companies with Automation
10 and Automation 20 products by 50% domestically and
penetrate the European market as a measure to promote the
advancement of technology that has been pioneered by developed
countries

Goal for the Long Term (Vision) is to be a pioneer in products that

prioritize the full use of Robotic Process Automation (RPA), high
security features and futuristic features. In addition, prioritize
environmental sustainability at the global level.
D. Uniqueness of
Automation 10
The uniqueness of this product is that it uses solar energy sources as the
driving force for this model. Additionally, it has a solar power storage
section for maximum use of up to 10 hours. It saves a company's utility
costs because solar power is renewable energy and can be stored. In
addition, it can maintain environmental stability globally with the function
of environmentally friendly Automation 10 and Automation 20 technology.

It has limited manpower where manpower is only used to key in data into
the system and the entire manufacturing makes full use of RPA (Robotic
Process Automation). It saves the cost of a company in staffing and hired
employees. Product quality is also monitored by AI (Artificial intelligence)
which is guided by global standards.
SECTION 3: MARKETING (PART A)

RESEARCH AND ANALYSIS

TARGET MARKET

MARKET SIZE AND TRENDS

COMPETITION

ESTIMATED MARKET SHARE

 • The manufacturing industry’s problems is
that they have a high labour cost, which
measures the price of labour for a single
unit of output, such as a single product. 

• It is a high risk to have so many employees

to work in the company due to the fact that
A. RESEARCH they might not been able to social distance
as much due to their job scopes.
AND ANALYSIS • Reduce labour costs to help other
businesses who are struggling with keeping
labour and maintain their relationship with
their previous customers by maintain closer
communication with user
• Improving their customer relationship
management, Generico is able to find a way
to innovate their product up to their
customer’s expectations
 • Stewart • Fletcher Disks,
Industries, • Indiana
• Pace Computers, Instruments,
• Board • Davis Designs,
Technologies, • Avitar Avconics
• Fullsiz Computer, • Acme Electric.
• Cantel,
Informedics,
1. TARGET • Northwest Digital,

MARKET
 • As competitive • Manufacturers of
pressures from both electronic products
domestic and will result in near-
international sources explosive growth in
continue to rise, the domestic
managers are being assembly robotics
forced to closely market during the
2. MARKET scrutinize their
product cost.
next decade.

SIZE AND • Industry managers are

now compelled to
TRENDS increase productivity,
maintain or improve
quality, and reduce
labor costs.
Otherwise, they will
suffer the same
consequences U.S.
Manufacturers of
televisions did in the
1960’s and 1970’s,
slowly wither away as
a result of foreign
competition.
3. • There is a wide • Robox, inc.
COMPETITIO spectrum of
roughly 30
• Manoforms
corp
N companies
addressing the • Smartarms, inc.
robotics market.
They range from
the multibillion
dollar MBI, inc. To
the four or five
startups
concentrated on
the west coast.
• Manufacturers
focus on the same
markets as
generico and
shared the $320
million market in
1996 such as:
• Mississippi
 • The CNC segment • The increasing adoption
dominated the market of conventional
in 2019 with a market systems, such as drills,
share of more than saws, and bores, among
80%. This can be others, in the
attributed to the construction sector is
growing need to reduce also driving the growth
the operating costs, of the segment.
4. ESTIMATED manpower, and errors
in the components
MARKET manufactured in
industries, such as
aerospace & defence,
SHARE and automotive, among
others.
• Manufacturers are
focusing aggressively on
the latest technological
advances in the field of
CNC software to
enhance the
connectivity between
machines and operators
while improving
flexibility within the
shop floor, which is
SECTION 3: MARKETING (PART B)

MARKETING PLAN

MARKETING STRATEGY

PRICING

ADVERTISING AND
PROMOTION
 • Generico’s target
markets are the • Shift from using
domestic market man power to using
A. for robotics spreads
across five major
and distinct
machines to
decrease the labour
costs and due to
MARKETING
industries. The the fact that a
automotive machine can get
industry has been more work done
PLAN
by far the largest faster and more
consumer of efficiently
robotics products,
using them
primarily in painting
and welding
operations
• Save utility costs by
using a solar panel
rather than having
to use electricity to
power up the
automaton 20. By
using a solar panel,
businesses are able
to save cost on not
only utilities, but
high labour cost as
well.
 • Generico’s goal in six • Generico will be able to
months’ time is to process create content in their
is to produce as many catalogue and show
goods as possible in the audience on how well
least expensive way their product works.

A.
possible and efficiently for
their end users’
satisfaction to achieve • What generico can do to
customer loyalty make sales is to send sales

MARKETI
people to have a meeting
• While in twelve months’ with them to educate
time is to be the go to their prospects about the
automation industry in all automaton 20 and even

NG PLAN
manufacturing business provide mini prototypes
due to the fact that to show them what it can
automated systems can w do and how it can be
ork round the clock

(cont.) without any stoppage. beneficial to their

company
1. MARKETING
STRATEGY

Encompasses an early Providing quality Innovative designs result Generico’s modular

stage focus on 15 to 30 products is its first and in greater flexibility with approach to product
major manufacturers of foremost task in potentially lower design, coupled with the
achieving its targeted
electronic products manufacturing costs products’ engineering
market share.
than competitors’ simplicity, will allow the
products. company to guarantee
maximum down time of
twelve hours to its
customers
 • Automaton 10 will be • Automaton 20 will be
priced at $40,000 per priced at $50,000 -
unit. The unit price is $60,000 per unit. The
ex-factory, less unit price is ex-factory,
shipping, and includes less shipping, and
resident software, the includes resident
HAL PC controller, and software, the HAL PC
one-day installation controller, and one-day

2. PRICING
and training. Complete installation and
documentation and an training. Complete
easy-to-read user’s documentation and an
manual are also in the easy-to-read user’s
package. manual are also in the
package.
3. ADVERTISING
AND PROMOTION

• Uses current customers, • Partnerships are similar

providing that to referrals in that they
satisfactory levels are exist within a
reached in terms of community of B2B
service, will likely favour professionals who often
to resume using their know of each other.
services. • Consider how the b2b
• Word of mouth buyer or procurement
marketing is considered executive thinks and
one of the strongest makes his or her
forms of marketing for decisions
b2b organisations
Section 4: Operation
 Identify
Place: India
 • Generico Inc. chose India as the manufacturing site of
Automation 10 and Automation 20 is because it has
among the countries with a high human population of 1.1
billion. It leads to many skilled and unskilled workers. In
addition, employee wages are also among the cheapest in
the world.
• The quality of work from India has a good reputation as
compared to in China. It gives advantages to Generico Inc.
to maintain a reputation for quality control that conforms
to global standards.
• In India, has Silicon Valley that can be used as a potential

A.1 Advatages customer for the domestic market for Generico Inc. There,
too, it can exchange new understandings about technology
and provide opportunities for potential customers in
Silicon Valley to try Automation 10 and Automation 20.
• India is close to ASEAN countries that are rich in cheap raw
materials. So, it will help Generico Inc. to save cost
compared to being based in a European country.
 • In India, Special Economic Zones (SEZ)
have been developed with the goal of
attracting Foreign Direct Investment
(FDI). A Special Economic Zone may be
formed jointly or jointly and severally by
the Central Government, State
Governments, or any other individual
involved in the manufacturing of goods,
A.2 Zoning according to the SEZ Act 2005. A foreign
company may also establish a SEZ in
India. So, it will be benefited towards
Generico Inc as a foreign business in
India.
 • Companies in India are taxed on their
revenue based on their residency status. A
business with a residential status in India
is taxed on its global income, whether
earned in India or elsewhere, while a non-
resident company is taxed only on income
obtained, accumulated, or arisen in India.
Foreign corporations with a Permanent
A.3 Taxes Establishment (PE) or a Branch/Project
Office in India are subject to the higher
basic rate of 40%.
 • Generico Inc strategy in finding suppliers
is started by prioritizing domestic
suppliers and the company also has an
advantage due to the dumping of
suppliers in india and resources. In
addition, Generico also facilitates
B. suppliers to order stock according to
manufacturing requirements according to
Approximately to customer demand. So, the inventory at
Generico can be organized well, there is
no dumping of unused stock as well as
suppliers facilitating the transportation of suppliers
to bring the product to the place of
manufacture of the product. This strategy
is also used for suppliers outside India so
that the operations of both parties can be
carried out systematically.
 • Generico Inc will use sea, land, and air
methods as trasportation to deliver products
to end customers. Suitable land methods are
used to deliver products to domestic
customers and surrounding areas. The use of
water method for customers who receive a
higher charge in receiving the product faster
C. Access to than sea and land. Meanwhile, the sea route
is for customers who are in different regions
transportation and pay a minimum rate on transportation
fees. It is late rather than the road and air
methods. Road services will be provided by
Generico Inc. Meanwhile, sea and air routes
will be done by companies that partner with
Generico Inc in delivery services.
Section 5: Management
 Management Team
Vincent Losciallo
Chief Executive Officer

Stephen Daniels Harold Ginjeans Priscilla Sproviero George Forrester

Vice President of Marketing Vice President of Engineering Controller Director of Manufacturing
 Vincent Losciallo 45%
Stephen Daniels 14%
Legal Harold Ginjeans 14%
Structure George Forrester 14%
Pirscilla Sproviero 8%
Other employees 5%
Board of Director,
Advisors and Consultant

A BOARD OF DIRECTORS IS A BODY OF PEOPLE WHO THE LARGER A COMPANY BECOMES, THE MORE
ARE CHOSEN TO REPRESENT SHAREHOLDERS. IF CARE IT REQUIRES, AND THE MORE PROBLEMS
GENERICO INC. HAS NO INVESTORS, THE BOARD OF THAT MUST BE ADDRESSED PRECISELY AND
DIRECTOR NO NEED TO POINT OUT IN THE CORRECTLY FOR IT TO CONTINUE TO THRIVE. AS A
BUSINESS PLAN. RESULT, FOR A VARIETY OF CAUSES, THE NEED FOR
A BOARD OF ADVISORS & CONSULTANT GROWS.
IMPORTANCE OF BOARD OF ADVISORS &
CONSULTANT ARE FOR BUSINESS DEVELOPMENT
AND A GOOD BACKUP SYSTEM.
Section 6: Financial
 Statement of
Comprehensive
Income
Statement of
Financial
Position
 •Generico, Inc.
Cash Budget •Cash Budget Month
Year One •(Not Reviewed By Independent Accountants)
 •Generico, Inc.
Cash Budget •Cash Budget Month
Year Two •(Not Reviewed By Independent Accountants)
 Generico Inc.
Year 1 Cost-Volume-Profit (CVP) Analysis

Total Per Unit

Breakeven
Sales (17 units) $ 680,000 $ 40,000
Less: Variable costs $ (398,000) $ (23,412)
Contribution Margin $ 282,000 $ 16,588

Analysis
Less: Fixed costs $ (1,425,975)
Net income $ (1,009,269)

(Year 1)
Contribution margin ratio 41%

Variable expense ratio 59%

Break-even point 86

What-if analysis for target profit

Target profit $ 7,000,000
# of units needed 508

Margin of safety ($2,758,570)

Degree of operating leverage (DOL) -0.279410147

 Generico Inc.
Year 2 Cost-Volume-Profit (CVP) Analysis

Total Per Unit

Breakeven
Sales (204 units) $ 8,160,000 $ 40,000
Less: Variable costs $ (4,278,800) $ (20,975)
Contribution Margin $ 3,881,200 $ 19,025

Analysis
Less: Fixed costs $ (3,448,577)
Net income $ 440,314

(Year 2)
Contribution margin ratio 48%

Variable expense ratio 52%

Break-even point 181

What-if analysis for target profit

Target profit $ 7,000,000
# of units needed 549

Margin of safety $909,378

Degree of operating leverage (DOL) 8.814618659

 • Control costs in the following ways:
 Cut costs by cutting purchases.
 Reduce the cost of sales by putting
Cost Control retailer orders out to fair auction.
 Eliminate unprofitable customers.
 Reduce uncollected revenue by requiring
upfront payment and enforcing stricter
lending rules
 GENERICO INC YEAR 1 Business Startup Costs
FUNDING Estimated Actual Over/(Under)
Investor Funding {4 2 }

Vincent Losciallo 520,000 514,000 (6,000)

Stephen Daniels 520,000 514,000 (6,000)
Harold Ginjeans 520,000 514,000 (6,000)
Priscilla Sproveiro 520,000 514,000 (6,000)

Budgeting
George Forrester 520,000 514,000 (6,000)
Total Investment 2,600,000 2,570,000 (30,000)

Loans
Bank Loan 1 - - -
Bank Loan 2 - - -

Plans
Non Bank Loan 1 - - -
Total Loans - - -
Other Funding
Accruals 43,000 42,500 (500)
Other
Total Other Funding 43,000 42,500 (500)

(Year 1)
Total FUNDING 2,643,000 2,612,500 (30,500)

COSTS Estimated Actual Under/(Over)

Fixed Costs
Marketing 400,000 360,933 39,067
Finance and Administration 120,000 117,252 2,748
Engineering/ R&D 800,000 776,493 23,507
Manufacturing 180,000 171,297 8,703
Total Fixed Costs 1,500,000 1,425,975 74,025

Average Monthly Costs

Advertising (print, broadcast and Internet) 800 790 10
Business Insurance 2,000 1,500 500
Business Vehicle Insurance 500 450 50
Employee Salaries and Commissions 60,000 62,300 (2,300)
Inventory, raw materials, parts 20,000 19,830 170
Miscellaneous Expenses 1,500 1,750 (250)
Owner Salary 25,000 24,000 1,000
Postage/Shipping Costs 800 800 -
Security System Monthly Payment 2,000 1,800 200
Supplies 5,000 4,360 640
Telephone 500 486 14
Total Average Monthly Costs 118,124 118,081 43
x Number of Months 6
Total Monthly Costs 708,744 708,486 258

Total COSTS 2,208,744 2,134,461 74,283

SURPLUS/(DEFICIT) 434,256 478,039 43,783

Section 7 Critical Risk
a. Potential problem

Uncertainty in Technology is Increased selection

defining a business. constantly evolving. and competition
 Foreign production causes.

Generico repeatedly failed in IT

b. Obstacles management and business leaders.
and risk.
Competition

Covid-19 pandemics.
c. Alternative
courses of action

• Cost reduction.
• Forecasting.
• Focus on increasing
revenue and margins.
Thank you