Principles of Marketing Spring Quarter 2013 ! Marketing Plan !

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Ben Alvord - Elvis Herrera - Greg Knox Madison Leskinen - Zach Pezzillo - Mark Uvari
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Table of Content
I. Executive Summary II. Company Description III. Strategic Focus and Plan
Mission Statement Competitive Advantage

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IV. Situation Analysis

SWOT Analysis Industry Analysis and Competitor Analysis Customer Analysis and Segmentation

V. Market-Product Focus
Marketing Plan Objectives Target Markets Product Positioning

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VI. Marketing Plan

Product Strategy Price Strategy Promotion Strategy Place (Distribution Strategy)

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VII. Break Even Analysis and Sales Projections

First Six-Months Five-Year Projections

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VIII. Implementation Time Table IX. Evaluation and Control X. References

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I. Executive Summary
The Presidential Chair from Ergo Equipments Thermo-Cooling Series is a high-end office chair that has both heating and cooling capabilities, and is charged not by battery but by a powered floor mat. This piece of office furniture will give corporate employees the opportunity to create comfort by being able to adjust and personalize their offices temperature to their desire. Ergo Equipment aims to sell and distribute the Presidential Chair to large corporate businesses locally and out of state, as well as smaller businesses that what to give their employees the opportunity to make their experience in the office unique, comfortable, and more positive. We plan to place advertisements for the new product line in established, business related mediums, such as, the Wall Street Journal, Forbes Magazine, and Fortune. We will focus on personal selling to our target market, and our current customers since we do distribute our products directly. We well have roles within our company that will go to business to introduce, demonstrate, promote, and sell our products to potential customers. In addition we will allow a trial period to anyone, and give a warranty on our Presidential Chair for customers who desire that option. Overall we want to show large and small companies that we are determined to give our customers the full service experience with Ergo Equipment, and demonstrate that we can offer capabilities and options that our biggest competitors do not have. Through the expected success of the Thermo-Cooling Series, especially with the Presidential Chair, we aim to expand outside of Rochester and New York to make customer relationships and product delivery more accessible to customers outside of our central location. Through location expansion, we will continue to generate innovative ideas, products, and marketing strategies in order to be making our expected revenue of $4,150,00 million dollars by the third year of the Thermo-Cooling Series Presidential Chair.

II. Company Description

Ergo Equipment is a local company that strives to sell luxurious ergonomic furniture and equipment to both corporate, and small businesses. Recently Ergo Equipment launched a new line, Thermo-Cooling Series, which focuses on delivering office furniture with more functions and components, at a lower price than the competition. The first product to be sold under the Thermo-Cooling Series is the Presidential Chair, a high-end office chair that has heating and cooling capabilities. Ergo Equipments headquarters is located in Rochester, New York and was founded by engineers and marketers in March 2008. All six founders take part as Executives and make up the Board of Directors, they are Madison Leskinen, Greg Knox, Ben Alvord, Zach Pezzillo, Elvis Herrera, and Mark Uvari.

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III. Strategic Focus and Plan

A. Mission Statement
To provide advanced functioning ergonomic equipment and furniture to small and large businesses, in order to increase comfort ability and productivity.

B. Competitive Advantage
Ergo Equipment offers more capabilities and components in our products than our competitors can provide to our consumers. The new Presidential Chair includes both heating and cooling functions, but is being sold at a lower price than the standard prices being offered by other companies in our line of business. This sets us apart from others in our sector, we have high quality products but sell at a lower price to attract new and returning business consumers. ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !

IV. Situation Analysis

A. SWOT Analysis Strengths
Lower price than competition. Direct distribution strategy. High quality product materials. Bundled price is offered for bulk purchases. Focused on corporate businesses and universities. Ergonomic products. Charged by electric mat. Both heating and cooling functioned chair.

Weaknesses
Not an established company. Only one location and one headquarters. Line of business has entry barriers.

Opportunities Product expansion. Location expansion. Company size expansion. Large target market.
Rank amongst competitors. Only one other company sells a heating and cooling chair, not an established company either.

Threats
Unstable demand of product. Current economic state. Lower end chairs are sold by established competitors. Majority of target market is unaware of our company and our products.

Strengths Since we are a new company we have aimed to provide a product in our industry sector that offers more capabilities than our competitors, and sell it at a lower price to attract their customers to switch, and new customers to the market. Through research we have discovered that most of the heating and cooling chairs, or just has one of the functions cost over $1,000, so weve planned and executed to be able to sell our Presidential Chair at $950. Our target market for the Presidential Chair is corporate businesses, universities, and small businesses, and in order to provide efficiency and develop relationships with

our customers we wanted to distribute our product directly. That way we can price our products lower than our competition because we do not have to pay the middleman in the different distribution strategies a percent of the profit. Another benefit that our customer will gain if they choose Ergo Equipment is that we offer our customers a bundled price if they buy the Presidential Chair in bulk quantity, which is an incentive for them to buy chairs for a majority if not all of their employees. Unlike a majority of our competitors, our Presidential Chair is charged through an electric mat that is placed on the floor, under the chair that can stay charged all day by plugging in to a nearby outlet. This is a more convenient for our customers because it is not battery charged within the chair, which often doesnt provide the highest quality or function capabilities consumers expect and desire. Weaknesses Our company has only been in the industry for five years, this can be viewed as a weakness because our target market audiences are unaware of our company and the business we can offer them, and we could be found less credible and reliable as other companies that have more experience or established a name within corporate businesses. Although our direct distribution strategy can be viewed as a strength, it can also be viewed as a weakness because we are only located in Rochester, New York. This creates complications and obstacles to face if we obtain customers that are out of the tri-state areas, or even abroad. In order to solve this problem we will have to make enough revenue to be able to expand to other locations that are close to areas that commonly buy from our company. Opportunities and Threats Being a new company may bring challenges but it also creates several opportunities to make decisions that will benefit the company several years to come. It allows us to expand and grow when the time presents itself and expand our product lines by branching out to other items corporate businesses may need, like office furniture and supplies. We also have the chance to begin dominating the market because the only other known company in the United States that sells a heating and cooling office chair is !
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Tempronics, and they have only been around for a few years as well, and is not an established company, or has a clear marketing plan to be implemented. This gives up the upper hand on taking customers from Tempronics because we offer the same product at a higher quality and a lower price. Some threats we face within our industry sector is that there is an unstable or unpredictable demand for office chairs in general, they last for a decade if not longer and so the turnaround time for selling more products to the same company is very limited. Especially when companies are facing difficult financial times and are needing to cut back on extra expenses and lay off several employees, leaving there little to no room to always afford the products from our Thermo-Cooling Series, even though are prices are lower than competition. This will influence corporate businesses to buy lower end chairs instead of high end chairs with luxury functions included.

B. Industry and Competitor Analysis

Our largest competitor will be Tempronics and their Temperfect Office Chair. There are some other companies that deal with just heated chairs, but Tempronics is the only major competitor that does both heating and cooling. They announced their cooled and heated Temperfect office chair in May of 2012 and priced comparable to high-end office chairs without that same functionality. Tempronics advertises many employer/employee benefits, as well as advertising saving energy, since you no longer have to heat/cool an entire room (using a maximum of 60-80 watts). The chair itself weighs 225 pounds, includes all of the obvious features in a high-end business chair, and comes only in Black. They link to studies on their website specifying their benefits. In many ways, Tempronics marketing actions are similar to our own. They are targeting wealthier office workers and employers to buy in multiple orders. The price of a single Tempronics chair is $1,150 with free shipping. You must order directly through them, or by one of only seven dealers scattered across the country. Companies must contact them for special discounts and multiple orders. Tempronics also advertises a special two-week money back trial so customers can try out the chair before committing to it. Since Tempronics is a small, private company, it is hard to get exact sales figures from them.

There are other indirect competitors as well in the office furniture market. Office furniture has relatively low market share penetration, with four major contributors. Those four include Herman Miller, HNI, Kroll, and Steelcase, which account for only 25% of total revenue for the market. The rest of the market is currently captured by a large number of small and privately owned businesses that supply to local communities. In 2012, over 70% of office furniture makers employ fewer than 20 workers, while 6.0% employ more than 100 workers. The largest office furniture trading partner with the U.S. is Canada, which receives about 50% of all U.S. office furniture exports. In the US, the office furniture market generally follows the employment rate, which makes sense, since more office supplies are needed when more people are being hired. Currently, the office furniture market has started to grow after a few years of decline because of the recession and change of work styles, and is estimated to be around $20.6 billion, with office chairs covering about 31% of that market. This is a 3.6% increase over the past year. As long as the unemployment rate continues to decrease, the office furniture market should continue to grow. Herman Miller is one of the largest office furniture manufacturers in the United States. Their most popular chair, the Aeron chair, is among the best-sellers in the business, and has a spot in the Museum of Modern Arts design section. They claim to be 94% recyclable to be green, and highly ergonomic, because it adapts to all shapes and sizes. The chair is breathable to keep you cool and keeps you in high alert because of the posture. The chair can be bought at a number of distributors, including Herman Millers online store, and costs around $829 plus shipping. Another competitor, Steelcase is a furniture manufacturer located in Grand Rapids, MI. Their most popular office chair is the Leap. The Leap also heavily advertises being sustainable, which is up to 98% recyclable. The chair claims high comfort and dynamic, with flexible backrests, and many controls. It is currently priced at $889. HNI and the other major competitors all have a similar priced and style of ergonomic chair.

C. Customer and Segmentation Analysis

Our customers for the Presidential Chair can be split into three possible target markets.

1. Business to Business B2B can be split into two groups, large and small businesses, as described below: Large Businesses These are multimillion-dollar companies like IBM and Apple that want to buy luxury items for a certain subset of their employees. The Presidential Chair is a luxury item, so they may use them for upper-management types, and people with large offices. Businesses will buy them if they see the upside of making their employees more comfortable at work, potentially causing more productivity. Small Businesses Small businesses have a similar motive to the large businesses, but with less revenue. Smaller start-up companies that value employee comfort over other expenses will buy this product. These companies are willing to spend more money on making their employees happy, in order to make them more productive, and spend more time in their offices. 2. Wealthy Businesspeople and Executives These individuals are male/female and are generally aged between 35-65. This segments income will be over $120,000+, and have money to spend on luxury items such as these chairs. They are hard-workers who spend a lot of time at their desk, sitting in an office. Their lifestyle can be described as having a family, high income, and a Masters degree+. They look to buy all high-end products, including dressing with brand names and following fashion trends. Because they are working so often, they would want to benefit from the Presidential Chair by making their work environment more comfortable. 3. Telecommuters and People Who Work From Home These individuals are similar to the wealthy businesspeople segment in terms of motive, but maybe have less income to work with. They are spending most of their time in a home office, and want to create a better environment to work in. They are male or female, aged around 24-40 and make between $50,000-$80,000 a year. They are more a part of a middle-class family with a busy lifestyle.

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The first B2B target market has the potential to be the most profitable option. They are the group that can buy our product in bulk, and have the most funding to buy it. Businesses that want to provide a comfortable feel in their offices, and in turn, large executive types, should be our main target market.

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V. Marketing-Product Focus
A. Marketing Plan Objectives Our product is positioned very carefully as high-quality office furniture combining workmanship and ergonomics for the customer who understands quality and is willing to spend money on the best. Unlike better-known products, we do not use cheap manufacturing technologies. We only use the best materials that will last a long time and make the product stand out as a quality piece in any office. We plan to gain ground on the market with our newest product, the Presidential Chair, quickly. We want to be moving 500 units in our first month, and almost double that amount each month and improving those numbers over the year to selling 6,000 in one month at our one-year mark. To successfully reach our sales goals we hope to have to increase our brand awareness in the market. To do so we will need to perform brand recall tests, at the launch of our Presidential chair, the 6 month mark, and one year after launch. Our goals will have to be adjusted based on our results but we hope to have a 10-15% name recognition after 6 months of sales and advertising. We would then want to increase our awareness to 40-45% after having our chair on the market for one year. After a successful launch of our main product, the Presidential Chair, we plan to add on to our product line and expand from the smaller executive and managerial into the larger pool of regular employees with a less expensive chair. We hope to launch our secondary chair in 9 to 12 months after our initial release of the Presidential Chair. Based on the sales of the Presidential Chair we will be able to correctly price and market our new chair and be able to more accurately predict and create goals for our sales. Without the data from our main launch, we hope to move double the sales of our Presidential Chair in our first month and have 18,000 new chairs sold by the end of our second year in production. B. Target Markets Our marketing strategy is based mainly on making the right information available to the right target customers. We can't sell people on our expensive products, because most don't have the budget. What we really do is make sure that those who have the budget and appreciate the product know that it exists, and know where to find it. !
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Being a premier provider does not require us to push our product on people, those who want quality will come to us. We will be specifically targeting upper and middle management in our advertising. These users will have prominent positions in their company with offices that need to reflect their status. While there is room for our chair in the small business market we plan on targeting medium to large companies, they are more willing and able to spend more on equipment than a small company. Customer Profile Target Market 1
Executives

Target Market 2
Managem ent

Gender Age Location Income

Male and Female 50+ National $120,000+ Comfort Status Stress Relief

Male and Female 35-50 National $90,000 - $120,000 Comfort Status Stress Relief

Motives & Benefits

C. Product Positioning For businessmen or women who want to integrate exquisite workmanship and design combined with state-of-the-art ergonomics and technology, the Presidential Chair is perfect. Unlike the competitors, Ergo Equipment makes no design compromises for standardization. Our Presidential Chair is one of the best chairs on the market with the newest technologies available. Our heating and cooling technologies are innovative and exclusively available on our Thermo-Cooling Series line of office chairs. Our marketing has to convey the sense of quality in every picture, every promotion, and every publication. We can't afford to appear in second-rate catalogs with poor illustrations that make the product look like it is not as high quality as it is. We also need to leverage our presence using high-quality catalogs and distribute to our customers directly. We will not be able to take the cheap route on any of our communications, from ads to delivery teams, they all need to be professional and deliver the highest quality service possible.

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VI. Marketing Plan

A. Product Strategy This is our presidential model chair from our heated and cooled office chair line. This is our highest end chair, and we aim to create a luxurious experience for people purchasing this item. Our goal is to make this chair affordable relative to the other products available in the market. The chair will be offered in only two colors, black or brown, both of which will give you an option of real or imitation leather. The size is similar to any full backed leather office chair, no added electronic bulk will be noticeable to the consumer. The chair will be powered through an electric mat that is plugged into an outlet, the rolling feet touching the mat is what connects the chair to power, enabling full motion without the issue of a power cord getting in the way. There will be a small built-in panel allowing personalized control of chair temperature, negating the issues of missing remote controls. The warranty offered will be in line with the luxury title. We will offer a full 2 year warranty where all products are guaranteed of defects for the warranty period. We will also offer an extended warranty for a small additional fee; this will cover the powered mat and contact points for another year. The chair will be packaged partially assembled in order to minimize the size. This will help to reduce transportation cost and make the packages easier for workers to move without injury to themselves. Instead of just a cardboard box the chair will come packaged in recycled plastic material, shaped to the partially disassembled chair in order to further reduce any bulk or need of packing filler. The plastic material also protects the item from damage much better than a box would. The scope of this particular chair is large corporations and specifically in executive or manager offices. The relatively small scope is in line with the high end luxurious image of the product. B. Price Strategy Our pricing strategy is a combination of market oriented pricing and penetration pricing. We are basing our original price off of what the competition is currently !
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selling at, and after researching the market we have decided to price our product slightly below our main competitor in-line with the penetration pricing strategy. We will be evaluating sales and market share continuously to adjust our prices in the coming years to maintain good profits and market share. The price is set to be competitive within the current market by offering another luxury heated and cooled office chair with new and innovative power supply, at a price slightly below the competition. For the luxury heated and cooled market, this means the product will be priced slightly below $1,000 retail for a single unit. We will offer discounts if companies want to buy several of our products in bulk. The chairs will not have to be from the same lines, for example if a company wants to fully outfit their offices with our products they can pick and choose from our other lines as well as the heated and cooled presidential model to affordably outfit their office with innovative and ergonomic seating. This particular model will not be offered in office supply stores and will be a special order item. We will primarily be selling this model directly to companies and will travel to their offices in order to give demonstrations of this new product that we offer if they desire. C. Promotion Strategy The objectives of the promotion of our product are to inform the customer of our product, persuade them to purchase it by showing them the unique things that it can do for them that no other chair can, and finally to remind them that the product is still needed by them. We will inform them through advertisements in business magazines, give them hands on demonstrations at trade shows and at their personal businesses, and we will continue to remind them about our product through advertisements and word of mouth. We will use a variety of techniques from the promotional mix including advertising, personal selling, sales promotion, and publicity. The positioning of our product will be based around high quality for a low price. Out attitude is all about creating a natural working environment for the customers and increasing their comfort and productivity. At the same time, we are providing this service to them at a lower price than they would find elsewhere. !
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Because our product requires complex buying decisions on behalf of the customer, we are focusing on personal selling as our way of promoting our product. This will include sending product representatives to perspective businesses to showcase our chair. They will meet face-to-face with these customers and show them all of the features that our product has to offer. Our representatives will promote our product through their attitude, appearance, and specialist product knowledge. They will aim to inform and encourage the customer to buy, or at least trial the product. We will also feature print advertising. These ads will feature in high-end business magazines such as Forbes, Fortune, and Wired. They will be full-page spreads that are aimed to target corporate representatives and heads of businesses. They will be very clean in their appearance and have a simple yet strong design. This will give them the message/idea that, because we are able to produce quality and strong advertisements, that quality will then transfer over to our product. Our media plan consists of traditional media, such as print and face-to-face promotion, and digital media, which would include online and social media. Our target market consists of two groups: businesses/corporations and wealthy businesspeople and individuals who own their own business. The print media, which would feature ads in magazines, would be targeted towards the businesses and corporations. They would be most likely to hear about our product from either business magazines, Forbes and Wired, or from trade shows, such as CES. These print advertisements would run each month in the magazines from 3-4 months prior to the release of our product and will continue a few months after it is released as well. It will then slow down to being featured every other month in the magazines. The digital media will be targeting the individuals. It will include social media and that targets startup companies and independent business owners. Resources such as YouTube, Twitter, Facebook, and other social media sites will be used to promote our product. The main focus, however, will be towards the corporations and large businesses. D. Place (Distribution) Strategy Our strategy for distributing the product is Direct Channel. It is similar to the exclusive strategy except instead of selecting one outlet where we will sell our product; we are selling it directly through our own business. We will be selling and distributing our product directly to the consumer. This will eliminate unnecessary power struggles between intermediary wholesalers and retailers. This strategy will also give our !
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company more control over the placement of our product and the price that it is sold at. By selling directly to the consumer, we will be showing them that our product is of high quality and that we value our interactions with them. Our target market consists of large corporations/businesses and individual business owners. By distributing our product directly through our own business, we will be showing our perspective customers that we care about their desires and value our interactions with them. The CEOs or representatives of these large corporations and businesses would potentially find out about our product when visiting a product trade show and would have interacted directly with our product and workers at the show. If they took an interest in our product, they would be able to order the product directly from our office or over the phone/online.

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VII. Break Even Analysis and Sales Projections

Break Even Analysis Selling price of each unit was determined solely on a competitive basis. Initial consensus concluded that providing additional features such as the thermo-cooled comfort in an office chair would provide an advantage in the segmented target market. Units sold (6,000 chairs) for the first year represents a conservative value. Other competitive companies that produce a similar product (Tempronics ) also produce HVAC (Heating Ventilation and Cooling) systems, heating and cooling beds, etc. Since Ergo Equipment will only manufacture heating and cooling office chairs, a conservative number quantity of units sold provides attainable goals which will allow a successful introduction to the market.
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Such approach is financially feasible since Ergo Equipment does not have other product lines that can sustain this new product line. Fixed costs include a total sum of the costs required to launch and sustain the product for the listed time period (Operational costs, equipment cost, lease of corporate building & electrical demands, research and development). Cost per unit represents a calculated value that includes the net price of manufacturing each unit (materials, labor) (Tool Design). Revenue, Variable Costs, and Profits are calculated values of based ore-established values based on a given time period (Selling Price, Units Sold, Cost per Unit, and fixed Costs). Alternative ways to reach a Break-Even-Point Preforming a break even analysis demonstrate the goals required in order to reach the break-even point, based on the initial projection (1 year). The required goals are represented by values controlled Ergo Equipment (Selling Price, Units Sold, Cost per Unit, Fixed Costs).

Selling Price: reducing the selling price by $10 ($930 - $920 = $10) will allow Ergo Equipment to reach its break-even point as long as the other input variables remain the same. If this approach is taken, Ergo Economics can utilize this as an advantage to provide a lower competitive price to its customers will still achieving their goals. Units Sold: reducing the quantity of units sold by 231 (6,000 units 5,769 units = 231 units) will allow Ergo Equipment to reach its break-even point as long as the other input variables remain the same. Such company can have a more attainable goal. Cost per Unit: increasing the cost required to produce each chair by $10 ($680 $670 = $10) allows Ergo Equipment to reach its break-even point as long as the other input variables remain the same. Ergo Equipment can use this added amount to account for any increasing manufacturing costs without having a drastic effect on the bottom line. Fixed Costs: increasing the cost required to launch and maintain the product by $60,000 ($1,560,000 $1,500,000 = $60,000) allows Ergo Equipment to reach its break-even point as long as the other input variables remain the same. This allotted value can prevent the increasing cost of energy, labor of promotion of the product to drastically affect the breakeven point.

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Direction of Ergo Equipment based on Break-Even Analysis Change Units Sold Selling Price $930 Units Sold 5,769 Revenue $5,365,385 Cost per Unit $670 Variable Costs $3,865,385 Fixed Costs $1,500,000 Profit $0 Based on initial projections and analysis, Ego Equipment will choose to alter the units sold , as the variable that will ultimately cause them to reach a break-even point and ultimately yield a profit. Reasoning behind this decision dictates that if the amount of units sold changes, it would not affect the critical operating parameters of Ergo Equipment. Since this is a launch of Ergo Equipment first product line, it is necessary that estimated elements such as operating costs and cost per unit are specifically controlled.

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Sales Projections (6-Months) Sales projections over a 6-month time period represents various elements of the introduction stage of the product cycle. The changing variable is the quantity of units sold. Utilizing the analysis obtained from the break-even analysis, the amount of units sold will ultimately have the greatest impact on the break-even point, and bottom line

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(Revenue & Profit). Increase in sales between months 1 and 2 will double (500 units to 1,000 units) and steadily increase by 1,00 units sold in the remaining months (Months 2, 3, 4, 5 & 6) Sales projected during this given time period demonstrates a profit margin that is negative (Red).
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Sales Projections (12-Months) Sales projections over a 12-month time period represents various elements of the introduction stage of the product cycle. The changing variable is the quantity of units sold. Increase in sales between months 1 and 2 will double (500 units to 1,000 units) and steadily increase by 1,00 units sold in the remaining months (Months 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12) Sales projected during this given time period demonstrates a profit margin that is positive (Black) at month 12. This value is concurrent with the break even analysis, a transitional point where Ergo Equipment reaches its break-even point (at 5,769 units sold) and turns a profit of $60,000 (at 6,000 units sold).

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Sales Projections (5-years) Year 1 - Sales projections during 1st year time period represent the introduction stage of the product cycle. A loan of 1 year period is solicited in order to acquire the necessary manufacturing equipment. The business focus will be to develop awareness of the product. Projected quantities of 6,000 units are sold thus yielding a profit of $60,000 during the 1st year. Year 2 - Sales projections during 2nd year time period represent the growth stage of the product cycle. The loan acquired in order to purchase the necessary manufacturing equipment comes to an end at the beginning of 2nd year, thus reducing the fixed cost (operational cost) to $800,000. Projected quantities of 7,500 units are sold thus yielding an increased profit of $1,150,000 during the 2st year. The increase in units demonstrates the business focus of acquiring market share. Year 3 - Sales projections during 3rd year time period represent the maturity stage of the product cycle. Given that the projected amount of units sold will double (Month 2 to 3), Ergo Equipment will focus on reducing the manufacturing costs of each unit by at least 10%. This reduction is a total value of obtaining quality materials at lower costs, devising ways to manufacture products with less set up time, and utilize extended machine capabilities to minimize lead time. Such lean manufacturing practices will reduce manufacturing cost by (10.5%). Projected quantities of 15,000 units are sold thus yielding an increased profit of $4,150,000 during the 3rd year.

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Year 4 - Sales projections during 4th year time period represent the maturity stage of the product cycle. The same lean manufacturing practices will be followed and efforts will be focused on customer retention. Projected quantities of 15,000 units are sold thus yielding a steady profit of $4,150,000 during the 4th year. Year 5 - Sales projections during 5th year time period represent the decline stage of the product cycle. The same lean manufacturing practices will be followed and efforts will be focused on making the transition between producing 15,000 units to a reduced amount of 9,000 units. Transition represents a period of adjustment not just for the customers, but for Ergo Equipment. This adjustment includes downsizing the manufacturing capability of the company in order to meet the specified demands of the consumer. Projected quantities of 9,000 units are sold thus yielding a declining profit of $2,170,000 during the 5th year.

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VIII. Implementation Time Table

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Implementation Time Table An implementation plan refers to the plan of action taken that actualizes the elements of the marketing strategy. Ergo equipments implementation plan is based on financial, marketing and profit analysis. Elements such as advertisement, Public relations, Sales Promotion, Personal Selling, Direct Marketing, and Digital Marketing. The time of these decisions are made is critical to the success of the Product. Year 1 - All promotional elements will be implemented except sales promotion. In the introduction stage of the PLC (product Life Cycle), sales promotion might cause two things, diminish the amount of earned revenue and form cheap connotation around the brand. Awareness of the product should be first priority, thus creating awareness will drive the promotional elements. Ads will be taken out in magazines; social media will be used in order to inform potential customers about the existent technology. Direct selling will help make potential customers feel confident about purchasing a product of this price. Displaying the new product in events such as CES (Consumer Electronics Show), allows the target market to interact with the product, thus facilitating the interaction with the customer. Year 2 - Approach implemented in Year 2 will be similar as in year 1. Reasoning includes that the product is in the growth stage of the PLC. During this stage, advertising must increase as compared to the first year. Forms of personal selling must also increase in order to create a demand that will sustain the projected growth.

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Year 3 - In year 3, Ergo Equipment will enter the initial stages of the maturity phase. By this time, Ergo Equipment built a respected reputation among State-of-the-art office equipment. Elements of heavy Advertisement, Public Relations and Digital marketing can reduce the value of the brand. The target market should recognize the brand as it stands for quality, thus encouraging the target market to continue to purchase the product. Year 4 - Year 4s implementation strategy includes similar elements form Year 3. The only difference is in the reduction in advertising and the initiation of sale promotions. As the product reaches the peak of the maturity stage in PLC, heavy advertising becomes an unnecessary cost. Introducing sale promotions allows a direct increase in sales, thus directly affecting the revenue margin. Year 5 - Year 5 represents the decline of the product in PLC, reducing direct marketing and personal selling while increasing sales promotions will allow Ergo Equipment to yield a profit. This is caused by reducing the total operating margin of Ergo Equipment.

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IX. Evaluation and Control

Prior to launching the release of the new Thermo-Cooling Series first product the Presidential Chair, will we conduct testing, product evaluations, and customer suggestions during the final stretch of our research and development stages. We will make sure the electronic mat charges and functions properly, as well as the heating and cooling functions inside the Presidential Chair. Then we would bring in focus groups of about 30 people who work in corporate industries to evaluate the Presidential Chair and if it lives up the expectations and standards of luxury and comfort. After they finish the evaluations we will ask if there is anything we can approve on before we launch the Presidential Chair and begin the marketing and selling stages of our marketing plan. After the launch of our product we will wait approximately six months before we conduct more evaluations on how our product is selling and attracting attention. Once the six months have past we will send out additional surveys to companies that have purchased the Presidential Chair, and give them the opportunity to come to our headquarters in Rochester, New York to receive additional demonstrations of the product, answer individual questions, and fill out the surveys in person to build the customer relationships. The last process we will continuously do through out the life span of the Presidential Chair is compare our predicted quarterly sales to the actual sale numbers, as well as comparing sales from previous years to see if any patterns or trends are starting to appear. This will give us the opportunity to predict if we are facing a decease in sales, or an increase and if we need make adjustments to the processes and plans we have in place at that time.

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X. References
"Tempronics." . N.p.. Web. 26 Apr 2013. <http://www.tempronics.com/products.html>.

Fundamentals of Tool Design. 6ed. Dearborn, Michigan: Society of Manufacturing Engineers, 2010. Print.
Esler, Bill. "Office Furniture Sales To Hit $20.6 Billion in 2012." Office Furniture Sales To Hit $20.6 Billion in 2012. N.p., 20 Dec. 2012. Web. 08 May 2013. <http://www.woodworkingnetwork.com/articles/wood-industryreports/184364451.html> "Aeron Chairs." Aeron. N.p., n.d. Web. 08 May 2013. <http://www.hermanmiller.com/products/seating/performance-workchairs/aeron-chairs.html> "Leap." Steelcase. N.p., n.d. Web. 2013. <http://www.steelcase.com/en/products/category/seating/task/leap/pages/overv iew.aspx>

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