1. Pedometer for the elderly: Germany Hendrik Becker (Germany) Susanna Yu Su Qian (Australia) Enrique Parra Arce (Spain) Rajkaran Singh Kharbanda (India) Victor Cruz Silva (Brazil)

2. The German Market Population: 82 million Highest Gross Domestic product in Europe GDP per capita around US$ 44,000 (in 2009) Second largest export nation worldwide

3. The German Market STRENGTHS: Solid industrial base Pivotal role of smaller companies High degree of people working in R&D Very low political risks Strong exchange restrictions within the Euro-area Very low corruption High HDI (0.947)

4. The German Market WEAKNESSES Dependence on the global market Poor demographics - 20.3% (16 million) of the overall population are older than 65 years - Birth-rate per women is with 1.37 one of the lowest worldwide

5. Strengths PRODUCT Software integration differentiation Performance: additional features Online services The pedometer allows family and medical personnel to be regularly updated on the health of their patients. DISTRIBUTION: Cost Advantage Outsourcing Avoids trade barriers and tariffs PROMOTION Nursing homes AND general consumers. Nursing homes: compete in the industry Consumers: it provides peace of mind Consequential benefits: generate interest

6. Weaknesses DISTRIBUTION FLEXIBILITY AND REACTION SPEED Software Germany: respond to market changes FAST and language familiarity Implementation speed: slow initially due to vast market but will improve over time Security and Safety Issues: POLL results in 2009 done by EU

7. Opportunities Expansion into new industries such as sports, fitness and schools to combat obese children Threats Substitutes and copy cats: to combat them we will protect our IP through patents and copyrights. Beat them on PRICE 20 euro/5euro a month Increased switching costs Transfer costs

8. SALES FORECAST According to a 2008 research by Faisal Bank of Switzerland the number of beds in the nursing homes was 757.186. However, they predicted the increase of this number to 1.135.000 in 2020 and 1.514.000 in 2050. We have estimated that around half of the beds are occupied by elders with some health problems that restrict them from doing any physical activity. This way we are facing a market of 175.000 consumers (assuming that among the 350.000 consumers there would be some not interested in the product). YEAR20112012201320142015 SALES € IN THOUSANDS 7003800670082008300 CONSUMER S 50003000065000100000125000

9. SOURCES OF FINANCE According to our sales predictions we will need an starting capital of 250.000 € + 75.000 €. SOURCES: Investors Forums: supporters of young enterpreneurship who want to invest money in interesting ideas. German Government: 7% of the nursing homes are owned by public German entities. As a consecuence financing us would be like and advance payment.

10. FOREIGN EXCHANGE RISK Because we will be outsourcing the production we will be facing some exchange risk. India has a managed floating exchange rate with no predetermined path. The EUR/INR rate have volatilities that are typical of floating exchange rates. However, large variations sometimes occur. In order to prevent possible losses we will consider some hedging operations.

11. Manufacturing Outsourced to India Global epicentre for technology and IT related manufacturing Becoming increasingly synonymous with quality High levels of expertise in linking/software and operating systems to hardware Experienced, cheap skilled labor – also possess advanced technical know-how Local established base in terms of contacts, manufacturers & suppliers Low transportation costs: relatively cheap shipping Benefits outweigh disadvantages: Cost-effective manufacturing

12. Cost Structure Software linking operating system to the pedometer hardware to be developed in Germany. R&D, installation, and maintenance costs for the 5-year period: €250,000 (in-line with industrial average) One-off cost Includes software and technology development, and operating system encryption for the product Cost of production per piece based on the forecasted sales figures: €11. Added cost of €4 for every pedometer due to transportation, taxes, fees, duties, exchange rates, packaging etc Total cost per pedometer to the point of sale: €15.

13. German vs. Indian Market Cultural Differences  Structure of Indian families differs significantly  Extremely rare for people in India to send their parents/grandparents to retirement homes and aged-care facilities Contrasting Economic Systems  Majority of the Indian population lives below the poverty line  Very low Per Capita GDP relative to Germany.  Vast proportion of the population wouldn’t be able to afford the product and pay for complementary services. Dependence on Technology  Low dependence on technology on average  Increased demand for personal care (nurse or family member) to monitor health progress.  Unwillingness of the elderly population to adapt to technology. We do not anticipate high level of sales in India

14. Problems anticipated after entry ● Threat to Privacy and Security ● Virus and Hackers

15. Conclusion ● Why it will be effective: ● Unsaturated and Neglected Market ● Protected Intellectual Property ● High Switching Costs ● Integrated Promotion Strategy ● Outsourced Production

16. Thank you! Questions?