2.

COMPANY DESCRIPTION

2.1 Brief History and Nature of SAMTECH

The company is owned and managed by Sama Promise Awa, an electronics technician with a
degree in electrical engineering from the Higher Technical Teachers’ Training College (HTTTC)
Kumba. He has a combined experience in computer software and hardware maintenance,
Networking, Printed Circuit Board Designs and Computer Programming, that can help them
build SAMTECH Repair Shop. He will also employ his family members to help with running
and growing the business.

Our business goal is to become regional leader in consumer electronics repair, with shops
throughout the South-West Region of Cameroon. SAMTECH is a growth-oriented business. Its
ten year goal is to become a regional leader in consumer electronic repair, with shops in the
South-West Region of Cameroon. With this in mind, the objectives over the next three years for
SAMTECH are the following:

 Achieve steady growth in sales revenues by year three.

 Achieve local market share (in Kumba) of approximately 20% by year five.
 Expand product line to include authorized satellite TV service installation and new
electronics sales.

SAMTECH is a business located in Lido Street of Kumba. The company specializes in the
design, realization and installation of electronic equipment, repair and sales of consumer
electronics, specifically home electronics, including TV, DVDs and VCRs. It also operates in the
computer and office machine repairs, communications equipment repairs and other electronic
equipment repairs.

We will target people who place great importance in their entertainment equipment and own
higher-end electronics, where repairing them would be more cost effective than replacing them.
Many low end VCRs for example, are priced so low, people find it more cost effective and
convenient to purchase a new product than to get the existing one repaired.

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The mission of SAMTECH is to provide high quality, convenient and comprehensive home
electronics repair at a low cost. The most important aspect of our business is trust. It is the goal
of our firm to have 100% customer satisfaction in regards to quality, friendliness and time to
completion, and discover new ways to exceed the expectations of our customers while doing so
at the lowest possible cost. We want to build an electronics repair business that can favorably
compete with other leading brands in the electronics repair services industry.

2.2 Management
As a matter of fact, profit-sharing arrangement will be made available to all our senior
management staff and it will be based on their performance for a period of five years or more as
agreed by the board of trustees of the company. In view of the above, we have decided to hire
qualified and competent hands to occupy the following positions; these positions are in order of
hierarchy and flow of information from the CEO right down to the client service Executive.

 Chief Executive Officer

 Head, Technical Services
 Human Resources and Admin Manager
 Sales and Marketing Executive
 Accountant
 Electronics Repair and Maintenance Engineers and Technicians (10)
 Client Service Executive

2.3 Business Structure, size and location

SAMTECH is an electronics repair business that intends starting small as a shop in Lido Street –
Kumba, but hopes to grow big in order to compete with leading electronics repair companies in
the industry. We are aware of the importance of building a solid business structure that can
support the kind of business we want to own, which is why we are committed to only hire the
best hands within our area of operation.

SAMTECH, we will ensure that we hire people that are qualified, hardworking, creative,
customer centric and are ready to work to help us build a prosperous business that will benefit all
our stake holders.

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3. DESCRIPTION OF YOUR PRODUCT/SERVICES
SAMTECH Electronics offers a wide range of services as outlined in the detailed sections below.
It is ultimately the goal of the company to offer a one-stop facility for all home entertainment
needs, including both sales and servicing. In this way the company can offer greater perceived
value for the customer than many other shops which only offer sales or services.

The industry is highly competitive with suppliers having a great deal of power in setting and
negotiating the prices of their products and services to repair shops. In addition, because the
customers see the service as undifferentiated and a “commodity” with little value separation
between competitors, buyer power is also very high. Finally, the barriers to entry are moderately
low, and the large number of competitors in this field, including substitutes (such as do-it-
yourself work) mean that the pricing for such services is very competitive. The only way to have
an advantage in this industry is a low cost leadership principal applied aggressively or to create
higher switching costs through the building of strong business-to-customer ties. It is the aim of
SAMTECH Electronics to create a competitive advantage through both the low cost strategy and
by offering greater value through its broader product and service line.

3.1 Identification of SAMTECH Products/Services

SAMTECH Electronics provides a wide range of home entertainment repair services. These
include:

 Repair and cleaning of  home and car stereos and CB radios.
 Repair and cleaning of TVs.
 Repair and cleaning of VCRs and DVDs.
 Sale of used TVs, stereos, VCRs and DVDs.
 Free estimates on repair jobs.
 Authorized warranty servicing on all major brands of home entertainment systems.
 Responsible for carrying out consumer electronics repairs

 Carrying out computer and office machine repairs

 Responsible for carrying out communications equipment repairs

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  Responsible for handling other electronic equipment repairs such as dental
equipment, medical and surgical equipment and optical instruments
 House calls and free pickup and delivery.
 Provide Repair Service at Customer’s Home:

3.2 Key Features and Benefits of SAMTECH Products/Services

SAMTECH product/services are beneficial in the following ways:

 It has staffs who provide repairing services at consumer’s home thereby cutting off the
cost of transportation of heavy electrical products.
 They also provide their services at a remarkable discount.
 Welcomes clients and potential clients by greeting them in person or on the
telephone; answering or directing inquiries.

 Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone)
provides the client with a personalized customer service experience of the

highest level

 Through interaction with clients on the phone, uses every opportunity to build
client’s interest in the company’s products and services

3.3 Product Protection

Future products and services that SAMTECH Electronics will prepare to institute include
TV/VCR/DVD rental, satellite TV installation and servicing, sales of new TVs, DVDs, VCRs
and stereos, and repair/sale of microwave ovens. Mr. SAMA is also investigating the possibility
of offering a new product line of home entertainment cabinets at some future date.

These Services are provided to assist customers in making informed decisions about the financial
services we provide to them. It explains who we are, the financial services provided by us, how
we are remunerated and how their complaints are dealt with. Where we provide general factual
advice to them about SAMTECH Accidental Damage Protection Insurance, or arrange for the
issue of SAMTECH Accidental Damage Protection Insurance to them.

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4. MARKET ANALYSIS

4.1 Industry Analysis

SAMTECH Establishment will be part and parcel of the electronic industry in Cameroon which
is a growing branch of the economy. There enormous factors influencing the growth of the
industry such as:

 Increase in population
 Increase in the electronic equipment brands
 Increase in technology and so on

There are no standard regulations which can affect electronic repairs in Kumba. However, some common
costs and profit margins tend to influence consumer-capability of electronic equipment use. These
include: personal influence from families, changes due to inflation, and rural-urban migration.

The opportunities for electronic repairs and sales are enormous. The population of Kumba is large enough
and given their economic power and standard of living, there is enough market demand to satisfy the
supply. Moreover, the people in this area have a very low bargaining power which is an added advantage
to the business. Threats that may impinge the growth of SAMTECH are:

 Lack of capital
 Competition from similar businesses
 Lack of advance equipment to meet the necessary repairs

There is no entry barrier into the business. The main competitors are uneducated and mainly use unskilled
labor. This is an advantage to SAMTECH.

4.2 Market Research

There are approximately 332,500 households in Kumber area. Virtually all of these households
have TVs, VCRs, etc. SAMTECH segments its market into product categories that reflect the
estimated number of each electronic device currently being used in the greatly in Kumba area,
since each of these devices may fail at any time and require our services. Presently, the fastest
growing product, in terms of sales, is the DVD player. It is anticipated that the DVD will replace
the VCR within the next three to five years as movie rental stores replace their existing VHS
movies with DVD. The largest segment is the home and car stereo segment, since usually a

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household has more than one of these systems. The company will be focusing on servicing all of
these systems, and not focusing on one over the other.

4.3 Target Market Analysis

The STP process is an important concept in the study and application of marketing. The letters
STP stand for segmentation, targeting, and positioning. The STP process demonstrates the links
between an overall market and how a company chooses to compete in that market.

4.3.1 Market Segmentation

SAMTECH has segmented the households in the SAMTECH area as follows:

 Couples with children.

 Couples without children (including Baby Boomers).
 Retired people.
 Students living in multi-unit housing.
 Single people living alone.
 Single people living with roommates.

4.3.2 Targeting
SAMTECH will target the following segments.

Middle class couples without children. This group will tend to have a higher disposable
income since they have two incomes but do not have the expense of children. They prioritize
socializing and spend a fair amount of time entertaining in their home and in the homes of their
friends. For this reason they will spend more on their electronic equipment.

Single men living alone or with roommates: This group is not the largest segment for us, but
potentially one of the most profitable, since single men tend to prioritize their home
entertainment equipment. They will spend a greater percentage of their income on high-quality
TV and stereo equipment.

Baby boomers: Baby boomers are reaching the age where their children have left home and they
have more disposable income than when their children were young and living at home. They are
more tech savvy than the generation before them and appreciate the good things in life. They like
to spend time in their homes, now that the children are out of the house

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4.3.3 Positioning
As stated before, the electronic repair industry is highly fragmented. In fact, there are so many
small providers that any company in this industry is facing a purely competitive environment.
Approximately 23,700 electronic repair firms exist in the country today. Firms within this field
range in sizes from the "mom and pop" outfits such as MAXLAP Electronics and Kachina
Repair  in downtown Kumba to regional companies like Magnolia Hi-Fi and the national chains
such as Circuit City. Not all of these firms are purely repair outfits. In fact all of the larger
firms make the majority of their revenue in original sales. It is these companies that have the
largest market share and have the opportunity to compete by differentiating on customer service
or product/service range.

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SUMMARY OF MARKET ANALYSIS
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5
Potential Growth CAGR
Customers
TVs 3% 415,875 428,351 441,202 454,438 468,071 3.00%
VCRs -2% 310,645 304,432 298,343 292,376 286,528 -2.00%
DVDs 25% 106,400 133,000 166,250 207,813 259,766 25.00%
Stereo Systems 12% 875,500 980,560 1,098,227 1,230,01 1,377,616 12.00%
4
Microwave Ovens 8% 282,625 305,235 329,654 356,026 384,508 8.00%
Total 8.67% 1,991,04 2,151,57 2,333,67 2,540,66 2,776,48 8.67%
5 8 6 7 9

6. OPERATIONS PLAN
SAMTECH services are provided through electronic repairs. Electronic equipments and
accessories are bought and stocked. These equipments and accessories come from Douala which
is the economic capital of Cameroon and not far from Kumba.

SAMTECH is expected to maintain a healthy financial position over the next five years. The
following plan outlines the financial development of our company. The business will be initially
financed by a 189,000fcfa five-year term loan and a total capital investment of 363,000fcfa.

The source to repay the loan will be the cash flow generated from operations. The company will
also finance growth through cash flow. After an initial period of five years, the company will be
able to make a further expansion. At that time, it is envisioned that a bank loan or equity funding
will be sought to finance the new development, in addition to retained earnings.

The projected financial statements have been prepared in accordance with the general accounting
principles, and necessarily include some amounts that are based on reasonable estimates and
judgment. For accounting purposes, the long-term assets are expensed using the straight-line
depreciation method, and inventory is accounted for based on the First-In, First-Out (FIFO)
method. The following sections outline important financial information.

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6.1

6.3 Research and development plans and other

Over the time, SAMTECH researches in electronic technology and has been interested in
producing local or homemade electronics rather than importing.

Total start up costs will be 363,000fcfa of which will be contributed by the owners and the
remainder will be secured through a proposed bank loan.