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Executive Summary

We have chosen SanDisk USB flash drive as the base company to develop our product. The

reason of this selection is due to extensive knowledge and experience SanDisk Corporation

in the memory driver in the global scale.

Founded in 1988 by Dr. Eli Harari, an internationally recognized authority on non -volatile

memory technology, SanDisk has grown to become the worlds largest supplier of innovative

create innovative product which would benefit the people. Our company is well established in

term of brand name which makes it easier for us to market our products.

We have decided to develop a digitalized USB flash drive product named SanDisk Handy

that has a special features like at least has 64 gigabytes memory in the USB flash drive to

make customer more easier to bring the USB flash drive everywhere compared to external

hard disk that already exist in the market. The other features of the USB flash drive is it has a

key lock or password in every USB flash drive so it will make it more safety to the person

belongs it. Furthermore the USB flash drive also can use as a mp3 that is easy to the

customer because they dont have to bring many gadget in their bag.

We develop this state of the USB flash drive from SanDisk for the middle age, who are

currently the age of 15 until 32 because we believe that the customer from middle age are

attract with the sophisticated item or gadget and make their life more easier especially for the

student compared to the above age who are common feel afraid to use new technology.

We expected that our product as it is friendly user and easy to bring anywhere. Customer will

definitely satisfied with the product as it has strong brand name SanDisk that are well known

for it solid quality. A strong brand name will attract customer especially for loyal customer.

We expect that we will get tremendous feedback from our customer as it the first in the

market. We hope that our product will be bought not only for student, teachers, lecturers but

also corporate person. We expected to gain profit at the introduction stage and will continue

increasing until the maturity stage.


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Background Of SanDisk

2.1 History of the company

Founded in 1988 by Dr. Eli Harari, an internationally recognized authority or non volatile

memory technology, SanDisk has grown to become the worlds largest supplier of innovative

flash memory data storage products.

Serving both customers (with more than 250,000 retail storefronts worldwide) and originalequipment manufacturers (OEMs) SanDisk designs, develops, manufacturers and markets

flash storage products for a wide variety of electronic systems and digital devices. SanDisk

also licenses its technology to a number of other indu stry-leading companies.

With flash memorys capability for storing large amount of data in compact, removable or

embedded format, SanDisks product has helped drive the exponential growth in sales of

digital cameras, multi-function mobile phones, USB flash drives, digital audio/video players,

and other digital customer devices.

SanDisk currently has more than 860 U.S patents, more than 550 foreign patents and more

than 1440 patent applications pending in the U.S SanDisk is the only company, worldwide,

that has the right to both manufacture and sell every major flash card format, including

CompactFlash, SD, miniSD, microSD, MultiMediaCard, Reduce Size MultiMediaCard (RS -

MMC) Memory Stick PRO and related Memory Stick products, xD-Picture Card and USB

flash drives.

SanDisk become a publicly traded company (NASDAQ-SNDK) in November 1995, and in

2008 revenues were 3.4 billion. With more than 300 employees, worldwide, SanDisk is

headquartered in Milpitas, California.


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2.2 The Existing Lines of Product

Removable Cards

Our removable data storage solutions are available in almost every major form factor

in our primary markets. For example, our CompactFlash removable cards, available

in capacities up to 32 gigabytes, are well -suited for a range of consumer applicati ons,

including digital cameras. Our professional products include the SanDisk Ultra and

SanDisk Extreme product lines which are designed with additional performance and

reliability. Our ultra-small microSD removable cards, available in capacities up to 1 6

gigabytes, are designed for use in mobile phones.

USB Drives

Our Cruzer line of USB Flash Drives, or UFDs, are used in the computing and

consumer markets, are available in capacities up to 16 gigabytes, are highly -reliable

and are designed for high performance. Our Cruzer products provide the user with

the ability to carry files and application software on a portable USB drive. Also, our

Cruzer Crossfire UFDs are specially designed to make the console or PC gaming

experience portable. Our Professional and Enterprise line of UFDs are geared

towards the corporate user and are specifically designed to support secure and

authorized access to corporate information.

Embedded and Semi -Removable Products

Our embedded products are a set of reliable, high cap acity, high performance and

cost-effective embedded flash memory drive solutions for both data and code

storage. Our iNAND embedded flash product line, with capacities up to 16

gigabytes, are designed to respond to the increasing demand for embedded stora ge

for mobile phones and other portable devices. We also offer high -capacity SSDs

targeted for the personal computing and network server markets in capacities up to

64 gigabytes.


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Digital Media Players

Sansa is our branded line of flash -based digital media players for the digital audio and

video player market. Many of our Sansa models offer a removable card slot for easy

transportability of music between devices and storage capacity expansion. Features

within our Sansa line of products include FM radio , voice recording and support for a

variety of audio and video music download and subscription services. Sansa media

players are available in capacities up to 32 gigabytes. We recently launched our

slotMusic and slotRadio products that greatly simplify m usic content availability

for consumers.


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2.3 The Present Management

Dr. Eli Harari

Founder, Chairman and Chief Executive Officer

Dr. Harari has served as CEO since SanDisk's inception in 1988, during which

SanDisk has grown to over $3 billion in annual revenues. Harari is a pioneer in non

volatile semiconductor storage with more than 100 US and foreign patents and

numerous technical articles. He has more than 30 years experience in theelectronics industry. His extensive operati onal and technological development

experiences include co-founding Waferscale Integration, overseeing the

development and transfer into production of Intel's first -generation stepper and dry

etch technology, and technical management positions at Hughes Air craft and

Honeywell. He holds a M.A. and Ph.D. in Solid State Sciences from Princeton

University and a B.S. (Honors) degree in Physics from Manchester University.

Sanjay Mehrotra

President and Chief Operating Officer

Mehrotra is a co-founder of SanDisk and has served as director of memory design

and product engineering, vice president of product development and senior vice

president of engineering. His earlier experience in the semiconductor industry

included work at Intel Corporation, Seeq Technology, I ntegrated Device

Technology and Atmel Corporation in the area of design engineering and

engineering management, mostly in EPROM and EEPROM product development.


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Mehrotra holds B.S. and M.S. degrees in electrical engineering and computer

science from the University of California, Berkeley.

Judy Bruner

Executive Vice President, Administration and Chief Financial Officer

Bruner joined SanDisk in June 2004 as Executive Vice president, Administration

and Chief Financial Officer, after serving on the company's Board of Directors for

two years. She is responsible for accounting & finance, investor relations, human

resources, information technology, legal, and business development. She served

as Senior Vice President and Chief Financial Officer of palmOne, Inc. fr om

September 1999 through June 2004. Previously, Bruner spent 11 years at 3Com

Corporation as Corporate Controller, VP of Finance for Enterprise Systems and

Corporate Treasurer. Prior to 3Com, she was CFO at Ridge Computers, Inc., and

she started her career at Hewlett-Packard in accounting and finance. Ms. Bruner

holds a Bachelor of Arts degree in economics from the University of California, LosAngeles and a Master of Business Administration degree from Santa Clara

University. Ms. Bruner serves as a director for Ciphergen Biosystems, Inc.


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2.4 Strengths of the Company

We have a tradition of innovation and standards creation which enables us to grow the

overall market for flash memory. Our intellectual property ownership, in particular our patent

claims and MLC manufacturing know-how provides us with license and royalty revenue as

well as certain cost advantages. Flash Ventures provide us with leading edge, low -cost flash

memory. In addition, we also market and sell a broader range of card formats than a ny of our

competitors, which gives us an advantage in obtaining strong retail and OEM distribution.

Lastly, we have global retail distribution of our products through worldwide retail storefronts

and we have worldwide leading market share in removable flas h cards and UFDs.


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Product

3.1 Product Attributes

The SanDisk Handy is the new gadget for computer product that introduced by t he SanDisk

Corporation. This new USB flash drive is designed sophisticated to be suit in this new era

where most customer search for convenience, faster and higher value product.

SanDisk Handy is design to be convenience. It will give more benefits to customer when

they use this USB flash drive. Mostly, customers will be irritated when using USB flash drive

because of the virus that makes them lost their file. With this USB flash drive it will make full

safety with the virus that attacks the internal USB flash drive.

Other feature is auto key lock system . Automatic key lock system prevents the file in the

USB flash drive from being stolen by other person. Like other USB flash drive, it can easily

open private file without any safety.

This storage device comes with capacities currently up to 64 gigabytes . Even though this

USB flash drive is small but it able to store computer files, pictures and music on keychain -

sized devices and then quickly and easily transfer these files between laptops, notebooks,

desktops and other devices that incorporate a USB connection. So customer no need bring

the giant or big external hard disk because USB flash drive has takes their roles.


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The small designed will attract customer to buy this product. This is because this product

can be keeping in everywhere even in their purse. Nowadays people love something that is

small or in mini size such as mini headphones, mini laptop, mini car and mini portable music

player.

Another advantage to having SanDisk Handy is this product is shockproof and

waterproof. This USB flash drive will protect files anywhere and in any weather. Even you

are stuck in the rain, this SanDisk Handy will not damaged or make you lost the important

or favorite files.

This product available in various colors combining high saturation hue with chic design in a

widely-used USB flash drive. The blue cover in combination with the white storage device

delivers transparency and freshness, while the orange -and-white combination presents an

energetic and confident expression. Perfectly incorporated into a flash d rive, heliotrope

allows another sophisticated and delicate user experience. Fresh, energetic and elegant, this

flash drive is more than just a storage device but a p ersonal accessory.

Moreover the features a diamond geometric pattern embossed on the pure white body and

the striped line engraved in the cover, preventing the cover from being misplaced after the

USB flash drive is used and further protecting the USB connector at all time. The stylish and

ease of use at an optimum design make the SanDisk Handy perfectly fit in the tightest

jeans pockets wallet, and stylish carry bag or hanging on a key chain.

3.2 Product Packaging

The USB flash drive will be covered with air tight hard transparent plastic in order to eliminate

damage to the product and also to make our consumer can easily look at our product

features and design while them make purchase.

The packaging of the product is made from environment friendly, user friendly because we

include all the information that needed by customers. The packaging i s attractive because it

contains the picture of the product.


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3.3 Product Labeling

The labeling on the products packaging contains the pictures of the product, products name,

logo of SanDisk Corporation, the storage capacity of the product, product des cription,

manufacturer address, and certification from SIRIM.

3.4 Product Positioning

We already have strong name in USB flash drive product. SanDisk Handy can approach by

using mass media advertising. By advertised the product on the prime time on television will

increase the awareness of the customer.

SanDisk can position this SanDisk Handy as convenience and modern USB flash drive to

customer or in other word it is very user friendly. With light weight, easy to bring anywhere,

and its durability will make customer seek this kind of USB flash drive. SanDisk also can set

up booth at PC Fair to introduce this new product to customer. Demonstration of the feature

this new USB flash drive will gill better view to customer on how this product difference from

other USB flash drive in the market.


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Customer Analysis

4.1 Target Market for the product

The primary target customer for our product will be for the Generation X, people who

currently born between 1965 and 1979 that are according to research shows that most of theGen X is stable in term of financial. Normally they are working person and will target for this

kind of product to make them easier when do the job especially when they are facing with a

lot of work.

The secondary target customers are the Generation Y, people who born between 1980 and

1994. Most of them are entering into college and university will prefer our product to save

their assignment and else. They are more educated in using sophisticated technology and

they care about the important of using pendrive.

Our product will be favorable by the loyal customer as we have a strong bran d name. The

will please with our design as we spend a lot on our Research and Development to come out

with magnificent and up to date pendrive. Student will prefer this kind of product as they dont

have to worry about lost of file, stolen file or virus at tack.

4.2 The size of target market

As we know there are many people who are working person, business man or business

woman, students or else. So the size of target market for our product is big because they are

person who is our target market.

4.3 How they use our product?

Our product simple and easy to carry on. The size of our product is small and your can hold

it everywhere. For your information, the stylish and ease of use at an optimum design make

the SanDisk Handy perfectly fit in the tightest j eans pockets wallet, and stylish carry bag or

hanging on a key chain. Our product is friendly user and easy to operate it. Even illiterate

people will have no difficultly using it.

4.4 When they use our product?

Customer can use our product when necessary or in other word at anytime. They can use it

when they have a lot of work. If the customer become worried because they are too much

information that are using and afraid if the information is lost, they can use our product to

save it. Surely the data becom e safety.


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4.5 Where they use our product?

Every person who are already working and studying must have one pendrive for saving the

data or information purposes. So they can use the pendrive in the house, computer lab,

cyber cafe or else.

Sooner or later every person whether kids person also can use our product with efficiently

and there are many place not even in Malaysia even around the world will be using our

product as we are the pioneer. Our unique design will attract customer to purchase our

product. The customer will satisfy once then try out our SanDisk Handy .


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Competitor Analysis

5.1 Four Level of Competition

In this industry, it faces many level of competition and it has significant implications for

developing product strategy. Different set of task must be accomplished at each level of

competition. The levels of competition that our company faced are:

a) Product form competition

In this level of product we have many competitors in this level of product because

nowadays people widel y use USB flash drives in their life because it allow them to

store computer files, pictures and music on keychain-sized devices and then quickly

and easily transfer these files between laptops, notebooks, desktops and otherdevices that incorporate a USB connection. USB flash drives are easy to use, have

replaced floppy disks and other types of external storage media, and are evolving into

intelligent storage devices. So, this technology is fast moving and competitors always

seek for innovation USB flash drives.

b) Product category competition

The second level of competition is based on those products or services with similar

features. This is what managers naturally think of as the industry. In this situation, the

product category competition for this product is among the computing storage devices

c) Generic competition

The third level of competition is longer term and focuses on substitutable product

categories. These substitutes could fulfill the same customers needs. These

substitutes are treats to our companies as well opportunities to our company. The

generic competition for our product is others external storage media such as external

hard disk and mp3 player that have storage.

d) Budget competition

This is the broadest view of competition whereby it considers all products and

services competing for the same customer money as forming a market. For our

product, we are competing with laptop, books, clothes and many more. So, we must


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develop strategy to convince them about the benefits of USB flash drives instead of

others product.

5.2 Competitor in the Market

We face competition from numerous semiconductor manufacturers and manufacturers and

resellers of flash memory cards, USB drives, digital audio pl ayers and other consumer

electronics devices. We also face competition from manufacturers of hard disk drives and

from new technologies.

Apacer

Apacer is one of the direct competitors of Sandisk because

The Handy Steno AH162 is a new version available in various colors combining high

saturation hue with chic design in a widely -used USB flash drive. The blue cover in

combination with the white storage device delivers transparency and freshness, while

the orange-and-white combination presents an energetic an d confident expression.

Perfectly incoperated into a flash drive, heliotrope allows another sophisticated and

delicate user experience. Fresh, energetic and elegant, this flash drive is more than

just a storage device but a personal accessory. Moreover the AH162 features a

diamond geometric pattern embossed on the pure white body and the striped line

engraved in the cover, preventing the cover from being misplaced after the USB flash

drive is used and further protecting the USB connector at all time. The st ylish and

ease of use at an optimum design make the AH162 perfectly fit in the tightest jeans

pockets wallet, and stylish carry bag or hanging on a key chain.

Kingston


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Pricing

6.1 Pricing strategies

Pricing strategies usually changes as the product passes through its life cycle. The

introduction stage is very challenging. SanDisk bringing out a new product face the challengeof setting prices for the first time. SanDisk frequently uses this strategy c alled Market-

Skimming Pricing strategies in determining our pricing. Market -Skimming Pricing means

setting a high price for a new product to skim maximum revenues layer by layer from the

market segment willing to pay the high price; the company makes fewer but more profitable.

Market skimming makes sense only under certain conditions. First, the products quality and

image must support its higher price and enough buyers must want the products at the price.

Second, the costs of producing a smaller volume ca nnot be so high that they cancel the

advantage of charging more. Finally, competitors should not be able to enter the market

easily and undercut the high price. So, seem its already a trend for SanDisk to use this kind

of strategies, so we delightfull y put our SanDisk Handy at cost for RM99.00. Even though

we state a high price our customer will favor our product for our as we are one of the pioneer

in computer gadget. Customers trust our product because of the quality and differentiated

patent. Our unique features will definitely attract our loyal and new customer.

6.2 Comparison with Our Competitors Pricing

Based on the listing we provide it shows that our product price is a bit higher than the

rest of the product. It doesnt mean that mean that we simply state a higher price but

the customer will find it worth buying our product new feature. No other company


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Promotion

7.1 Promotion

Advertising that we choose is media advertising which is television, magazines and

newspaper and billboard.

For television advertising we use product endorser or spokesperson of our product. We use

celebrity such as the first student who gets 16As in SPM, Amalina to be our product

endorser. The advertising that focusing on student that makes the USB flash drive are safe

and easy. By using our SanDisk Handy will eliminate all the problems during using the USB

flash drive because our USB flash drive has a key lock which it avoid the files inside USB

flash drive from being stolen.

In the television adve rtising, our company will highlighted on our product features and

specialties which are convenience, auto key lock, mp3, and 64 gigabytes memory driver. The

time to advertise is at prime time which is from 8.00pm to 9.00pm. As our product is new we

advertised it on prime time for larger viewer or customer.

For magazine and news paper advertising we will include the specialty of our product that is

new in the market that non -competitor produces the same USB flash drive as ours. For direct

response and interactive advertising, we choose online advertising. For place advertising, we

choose billboard and bulletins including posters that can capture wide target market.

The company also does trade and customer oriented promotion, we choose trade show,

contests or sweepstakes. In trade show, our employee will set up the booths at hypermarket

or at PC Fair to introduce the product to consumers and also do the demonstration for better

view to customer.

Other promotional activities are marketing -orientated, public rela tion and publicity and

personal selling.


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Distribution

8.1 Distribution Strategy

Another crucial part in developing new product and to penetrate the market is the distribution

channel. Strong distribution channel play an important role in order to ensure our newproduct are well distributed and success in the market. Our aims is to make our product

available at almost everywhere so people will easily know about it and easy to find it. Thus

here we used a wide distribution channel. Below is the flow of our distribution channel

MANUFACTURER

SanDisk

RETAILER

Booth at:

y Jusco

y Parkson

y Giant

y Tesco

y Mydin

y ShoppingMally PC Fair

y Computershop

y CyberCafe

END USERS

Buyers


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Retailers and distributors are such a valuable thing to us thus it must be treated as a key

customer because they are the place which responsible to sell our product to end customers.

So it is very important to have a good relationship with them. There are few ways that we

practice in order to maintain this relationship. Firstly is the punctuality. We are very particular

in punctuality whereby we will send our product exactly at the right time and the right quantity

as stated in the agreement. Beside that w e will ensure that our products are always in a good

quality and condition. We also make a sufficient stock up, for immediate need by the retailer,

for example they want the product to be sent on other time and date not as stated in the

agreement we are willing to send it to avoid them from switch to other manufacturer. Other

than that we also emphasize on the payment system used in dealing with the retailer


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Customer Service

9.1 CUSTOMER SERVICE

In addition to continuously improving product quality, SanDisk is taking various steps to

improve its responsiveness and service capabilities with the aim of enhancing customer

satisfaction.

9.1.1 Using Internet

SanDisk uses the Internet as an effective tool for communication with customers. In addition

to enhancing the content of its websites, which include product -related news and frequently

asked question (FAQ) sections, the websites off downloads of manuals and provide prompt

information about product and services, including support servic es.

9.1.2 Peace of Mind Our Customer

Will never have to worry about unexpected or unplanned repair bills. The Plan pays for all

parts an labor to keep their product in good operating condition.

9.1.3 Quality Service

Ensures only SanDisk authorized and tra ined technicians with up -to-date diagnostic tools will

work on your product. When necessary, SanDisk engineers can assist service technicians.

Knowing how important there is to them.

9.1.4 Conditions of Warranty

We hereby certify that our product has been manufactured in accordance with the latest

technological guidelines, using modern equipment and quality high -grade material. Prior to

sale, our product was subjected to a variety of severe controls and tests. We therefore

assume full responsibility for an y possible defect due to faulty material or workmanship for a

period of one year from the purchase date. This warranty does not cover normal wear or

damage by the purchaser or other person nor defects due to external circumstances.

9.1.5 Training for Customer Service Staff

To ensure its ability to provide a uniformly high standard of customer service worldwide.

SanDisk provides e-learning-based training programs for customer service staff, including

SanDisk employees and those of authorized repair agents, t hereby facilitating the sharing of


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knowledge. In other effort aimed at increasing awareness of the importance of raising

customer satisfaction, SanDisk organize contest to test the technical knowledge and

customer service skills of employees who advise cus tomers making telephone inquiries, staff

service reception desks and so on.


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Expected Financial Return

2010 2011 2012

Quantity * 20 000 *30 000 *45 000

Total Revenue

(Price / Unit)

RM 99.00 X 20 000

RM1980 000

RM 99.00 X 30 000

RM2970 000

RM 99.00 X 45 000

RM4455 000

Total Cost

(Price / Unit)

RM 70.00 X 20 000

RM1400 000

RM 70.00 X 20 000

RM2100 000

RM 70.00 X 20 000

RM3150 000

Profit Margin

( TR-TC )

RM1980 000-

RM1400 000

RM2970 000-

RM2100 000

RM4455 000-

RM3150 000

Total =RM 580,000 =RM 870,000 =RM 1305,000

*For every year it is estimated quantity to increase around 50%

I. Selling Price for Retailer - Price Sold for Retailers

II. Cost Per unit - Including raw material, packaging, express and promotion

III. Market price - Price for customer

We still stick the price from year 2010 to year 2012 because the cost of production is still the

same even though there are many competitors with SanDisk.


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Conclusion

Based on our study on the potential market, cust omers and competitors analysis we are

strongly confident that our new product - SanDisk Handy will be successes in the market.

Because first and foremost we already have an establish brand name - SanDisk that is known

worldwide in producing a lots of produc ts that deliver good quality of product with full

satisfaction. We have a tradition of innovation and standards creation which enables us to

grow the overall market for flash memory . Thus we believed with this new product it will also

be success as the rest since we already grip the customer loyalty. Moreover our new product

SanDisk Handy deliver special features and have differential advantage thus it make us

pioneer in introducing USB flash drive with auto key lock. While in term of generic

competition, we already win since there will no substitutes product that can replace USB

flash drive. By hook or by crook people will still use USB flash drive for saving files purposes.

Same goes in the product form competition where there is still no other brands that offer

similar features like SanDisk Handy.

We also predict that we will face a big challenge in inventing this new product. We will face

with unlawful copyright by irresponsible company that crea te similar product with similar

features as our product. So our job is to maintain the pattern of SanDisk Handy. Beside that

our challenge also arises at all stage in product life cycle (PLC). Here we need a good

strategy in promoting SanDisk Handy especially at introducing stage, as well as

maintaining it at the growth stage. Here we need a lot of afford to ensure our product will be

sustain in the market growth as well as in heavy competition among our competitors as

mentioned earlier. And to make sure it can be accepted in the market.


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Reference

Internet sources:

www.Sandisk.com

www.kingston.com

www.apacer.com

www.toshiba.com

Book sources:

Philips Kotler, Gary Armstrong Principle of Marketing International Edition.

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