Board of Directors Report Baldwin 72 Sensors

Board of Directors Report

Baldwin 72 Sensors

April 24, 2008

Management 304

Section 203

STRATEGY

Our beginning strategy at Baldwin 72 is to ensure that we give our customers the quality they deserve, to charge fair prices in the industry, to provide our customers with the best customer awareness possible, and meet our customers changing demands. Our company has five market segments in the sensor industry: traditional, performance, low end, size, and high end. Our company’s strategy for our products is as follows:

The traditional market segment focuses on using current technology. Their main concern is the age of the sensor. Baldwin decided that early on in opeing the company that the traditional market segment will be our main focus. We will provide this segment with current technology and charge prices relatively average to the industry. In the second year of production the price range in the industry was between $27.00-29.00. Our team decided to price at $28.00 in our second year of operation. Our team thought it would be in our best interest to spend a higher amount on promotion than the industry average. In the second year of operation the average was $1,500 and our promotional budget was $2,500. By doing these things in the first few years of operation we had the highest customer awareness in the industry of 88%.

The performance segment focuses on reliability. Our goal for this segment was to stay in the industry average with mean time before failure. We will keep pricing on the high end of the industry average because they are not too price sensitive We will install a high budget for promotion the first few years of operation to let our customers know where we stand with this product. We will not produce too many products to in the first few years of operation because we do not want inventory left over for next year. In our second year of operation we had the third highest customer awareness with 59%.

The low-end...