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Agenda

Mission Statement Management Team

Introduction Initial Concepts Overall Marketing

Outlook, including Market Research & Advertising

Manufacturing/Production Financial Summary &

Planning Competition Industry Results Our Future

Mission Statement

Apex MC’s mission is to be the global leader in unique and innovative computing products that serve our loyal clients and build on the foundation of reliability, service, and technology for today’s world and beyond.

The APEX Team

Tangelia Banks - President

James Maher - VP Sales Management

Lemar Ravenell - VP Manufacturing

Robin Harvey - VP Marketing

Bonnie Blackwell - VP Marketing Research

Business Concept

Market Size GeographicMarket

DistinctiveCompetencies

CompetitivePosture

Focus on smaller, high margin

segments

Focus on geographic

markets which are in the middle of

the cost/size continuum

•Build a market position and

defend it•Take the lead and

keep it•Attack the

competition on their home ground

•Continue to be one step ahead of the competition

•Be the market share leader•Be the high

service provider in the market

•Provide the most reliable product

in the market

Target Markets

Mercedes – Primary Engineering and manufacturing High performance computer Willing to pay for high performance Highest demand in North America & Asia

Traveler – Secondary Executives and sales people Practical computer for travel Price sensitive Highest demand in North America & Asia

Brand Management

Mercedes – Czar High performance computing power Engineering applications Network/Internet connection Willing to pay $4,000

Traveler – Passport 2010 Computer portability Network/Internet connection Office applications Willing to pay $3,200

Marketing Research Summary

Q1 Q2 Q3 Q4

•Analyzed Customer Needs•Created Price Points•Evaluated Market Size

•Purchased Market Research•Placed ads in several media outlets

•Purchased additional research•Increased ads•Reviewed Brand Judgment•Updated Passport Pro to Passport 2010

•Purchased additional research•Reviewed Brand Judgment•Passport 2010 top brand in Traveler Market Segment

Advertising Media

Major Media Focus Mercedes Market

General News Magazines Science & Technology Magazines Business Newspapers Computer Magazines

Traveler Market New Venture Magazines Leading Trade Journals Sports Magazines Business Newspapers General Business Magazines

Advertising Summary (1 of 2)

Utilized differentiated marketing strategy Strong ad judgment for both markets by

consumers Conservative advertising in Q2 & Q3 with

minimal ad placement Maintained budget of $100,000

Market position established by Q4 in both markets Increased ad placements

Advertising Summary (2 of 2)

Ad placement increased in Q4 from under 10 to 95 inserts Raised budget to $800,000

Inundate markets in Q5 with inserts Evaluate advertising in Q6

Reduce budget by 25% and continue at this rate for the remainder of the year

Continue to research media preferences of target markets and modify accordingly

Marketing Summary

Mercedes – Czar Set competitive price at $3,800 in Q2,

modified in Q4 to $3,950 with $150 rebate Continue with current pricing for Q5 & Q6 Evaluated and adjusted promotional mix

each quarter Monitor market needs to modify brand and

price expectations

Marketing Summary

Traveler – Passport 2010 Brand required modification in Q2 & Q3 to

satisfy customer needs Set initial price at $3,200, modified in Q4 to

be competitive at $3,150 with $150 rebate Continue with current pricing for Q5 & Q6 Evaluated and adjusted promotional mix

each quarter Monitor market needs to modify brand and

price expectations

Manufacturing

Stage of Development Production method Advantages and Disadvantages

Production Assessment First year capacity utilization Four year production projections

Quality Management Quality control standards Establishing efficient quality control

Manufacturing

Batch 1: Form and finish desktop/portable designs

Our method of production is batch production. Batch production will allow modifications to be made to products that are otherwise the same.

Batch 2: Assemble base components

Batch 3: Install optional hardware upgrades

Batch 4: Assemble keyboard for the appropriate design

Batch 5: Load all fundamental software

Batch 6: Test computing power

Batch 7: Check networking and internet capabilities

Batch 8: Ready to package and ship first batch

Quality control is applied at

every stage

PRODUCTION METHOD

Manufacturing

Batch Production Advantages:

Employees will develop more individual task expertise Better quality products due to employee familiarity Batch can adapt to customer needs

Disadvantages: Difficult to modify a batch in production Switching batch mid-production = loss in output Increase in “work in progress” stock

Manufacturing

0 15 30 45 60 75

4th Qtr

3rd Qtr

2nd Qtr

Qtr OperatingCapacity

Capacity Utilization

By the 4th Quarter Apex MC optimized its production capacity

Production Growth

Apex MC prides itself on adapting to the market and

basing decisions on real numbers. This chart represents growth and adapting decisions

to market outlook.

Manufacturing

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

Qtr 2 Qtr 3 Qtr 4

Quanity Demanded

Operating Capacity

0

2000

4000

6000

8000

10000

12000

14000

Quanity Demanded

Operating Capacity

Linear (OperatingCapacity )

Current YearIn the 16th quarter we project the

quantity demanded to

more than double. The

result would be an operating capacity just over 12,000

units. This would equate to 83%

operating capacity

utilization.

4 Years (16th Qtr) Projection

Manufacturing

Quality Control: The following procedures will be applied to each batch:

Quality assurance: P.D.C.A or Shewhart Cycle

Stress Test Statistical Process Control

QualityAssurance

StressTest

StatisticalProcessControl

Quality Control

APEX MC – Financial Summary

APEX MC’s profitability outlook is very attractive

Currently achieving excellent results in sales, assets, and equity

Very well managed and highly profitable Positioned for further reinvestment

Financial Plan – Income

-$2,000,000

$0

$2,000,000

$4,000,000

$6,000,000

$8,000,000

$10,000,000

$12,000,000

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

RevenuesGross ProfitOperating ProfitNet Income

Financial Plan – Balance Sheet

$(500,000)

$-

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

$3,500,000

$4,000,000

$4,500,000

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

CashCommon StockRetained Earnings

Financial Plan – Cash Flow

-$2,000,000

$0

$2,000,000

$4,000,000

$6,000,000

$8,000,000

$10,000,000

$12,000,000

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

RevenueAdvertisingSales ForceNet Cash FlowCash Balance

APEX MC – Ratio Analysis

4th Quarter Analysis – Profitability Review

Net Profit Margin = $1,948,594 ÷ $10,408,710 = 18.72%

Return on Assets (ROA) = $1,948,594 ÷ $6,367,752 = 30.60%

Return on Equity (ROE) = $1,948,594 ÷ $4,000,000 = 48.71%

All ratios indicate that APEX MC is doing an outstanding job managing its profits

Year 2 Year 3 Year 4

Revenues $23,335,504 $37,189,754 $51,044,004

Net Income $5,070,577 $8,323,664 $11,576,750

Total Assets $12,779,800 $19,337,668 $25,895,535

Financial Plan - Projections

Cumulative industry results for last four quarters ending in Q4

  Minimum Maximum Average Apex MCTotal Overall 0.13 23.03 13.91 21.54Financial Performance 1.50 42.40 28.90 36.31Market Performance 0.39 0.55 0.49 0.49

Marketing Effectiveness 0.55 0.74 0.69 0.73Investment in Future 1.23 1.72 1.47 1.60Wealth 0.82 1.73 1.44 1.59Human Resource Management 0.68 0.70 0.69 0.70Asset Management 0.86 1.15 1.07 1.12Manufacturing Productivity 0.35 0.82 0.64 0.82Financial Risk 0.99 1.00 1.00 1.00

Industry Results (Q4)

Above average in almost all categories!

Our Future

Apex MC is looking to the summit!

CreateNew

Brands

IncreaseMarketing

PursueFurther

Investments

Continue To

OptimizeProduction