Potential market

SECTION I: The product

1a The innovation potential of this product is related to:

  • Technology-driven innovation (under the influence of the development of science – the market is not ready for the product)
  • Market-driven innovation (as a result of market surveys, the market expects the product)
  • Replacement of existing product
  • Product related to cost reduction
  • Radical new product
  • Other, what…
The product is an upgrading and synthesis of adapted tools.

The upgrading includes the customization of these tools from generic business tools to the specific needs of incubators management. Therefore all business analytical aspects are adapted to the incubation business cycle.

As for the synthesis, it formulates an integrated environment for all incubation management activities in a single platform. Through this, incubators staff and incubating companies use a single digital entry point to access and monitor all their management operations.

1b What added value for end-users does the product hold?
• higher quality
• Better technical characteristics
• Other …
High quality of management operations. More specifically, the tool improves the efficiency and effectiveness of the management capacity of the incubator staff by providing end users capabilities to handle procedures from the entry to the exit of an incubating company.

1c What is the Unique Sales Proposition of the potential product?
Software for business incubator management and monitoring of their internal innovation processes. (Niche product)

SECTION 2: The Market

2a What is the target market for the product?

National ¨

European ¨

Global ¨X

Please describe the characteristics of your target market.

Business Incubation is a world wide mechanism for nurturing new start-up businesses, as the role of SMEs in growth and development is universally recognised. Therefore, the market for our product expands to all continents, both developed and developing countries, with a number of approximately 3.500 incubators (“Best Practices in Business Incubation Lessons (yet to be) Learned”, R. Lalkaka, 2001). The majority is situated in the USA (around 1.000) and in Europe (914), while 10 of them are operating in Greece. Giving some examples of the rest, there are around 350 in China, 365 in Japan, 160 in Brazil, 30 in India and 22 in Israel. Taking into account that the above mentioned figures derive from various sources and various years and that Incubation is a rapidly thriving concept, we estimate that by now the number of incubators globally is up to 4.000.
2b How the product is characterized from the following options? Number of companies producing similar products in the field.

• Base – applied by all companies in the industry

• Leading – applied by a single or limited number of competitive companies

• Key –at a development stage, but has already proven its potential

Leading. There is limited number of companies developing similar software, as for the managerial part of the platform. There is no similar product found in our search that includes market targeted features for the companies along with the incubation management.
2c What type of market demand will be satisfied?

• Existing demand – the market is already developed

• hidden (latent) demand – the market has yet to be developed

It’s an existing demand, since there is a critical mass of about 4.000 incubators.
2d What is the current stage of the product’s market life cycle?

• Implementation, implementation in production (leading to a radically new product offers)

• Growth (rapid spread within the industry or outside it)

• maturity (parameters of the technical characteristics of manufactured products reached their maximum, higher-grade products can be manufactured on the basis of technological substitution)

It’s in an implementation stage. Although generic business management products and services exist for many years, this product differs from existing ones since it offers solutions to the needs of a specific up-and-coming market.

2e Strategic partnerships (existing or potential).
There is an existing partnership, the “MediCube network”, consisting of the partners of the MediCube project (INTERREG III B –ARCHIMED) through which the “Intelligent Incubator” platform was developed. The partners are:

  • URENIO Research Unit
  • Region of C. Macedonia
  • Province of Matera (Italy)
  • Province of Brindisi (Italy)
  • Region of Calabria (Italy)
  • MATIMOP- Israeli Industry Centre for R&D

This initial partnership was expanded at the end of the project, to incubators in Cyprus, Malta and Sicily (Italy), forming a network of incubators in all the above mentioned areas.

Potential partnerships for a marketing network, could be very useful with the National Business Incubator Association NBIA, http://www.nbia.org of the U.S.A. and the European Business & Innovation Centre Network , EBN, http://www.ebn.be

Critical are also the partnerships for global sales distribution, since the product is targeted to a global market.

SECTION 3: The Competition

3a What is the competition within your target market?
According to our search there are a limited number of companies that develop software for incubators but none of them offers tools that open up tenant companies to the market.

Cybergroup Inc. has developed a business incubator solution called “incuTrack” (http://www.incutrack.com/Home/tabid/36/Default.aspx ), that is more of a customized ERP solution for incubators

Avnon Consulting offers the “Incubator Portal”, (http://www.avnonconsulting.com/products.html#), a software concerning the internal operations of an incubating company in accordance with its relation to the hosting incubator.

“iPlanner.NET”, (http://www.iplanner.net/iplanner2007/public/business-plan/business-plan-software.aspx ), is an online management tool for business support organisations, including an on-line business plan evaluation, developed by NetEkspert.

3b What competitive advantages will the introduction of the new product ensue?

• lower prices based on lower production costs

• product differentiation (uniqueness of the product proposal)

Detailed comment

Mainly it’s the product differentiation, but additionally the price is in a low range.

3c Potential products relate to the following price range:

• High price range

• Average price range

• Low price range

Detailed comment

Low price due to low developing costs and the need to attract potential users, although prices are not easily comparable since competitors might offer part of this software or different types of contract services.

The proposed method is “Service Level Agreement”, (SLA), in national and global terms.

A SLA is a negotiated agreement between two parties where one is the customer and the other is the service provider. This can be a legally binding formal or informal “contract”.

An SLA commonly includes segments to address: a definition of services, performance measurement, problem management, customer duties, warranties, disaster recovery and termination of agreement.

Taking in to account that the user comes from Greece the process must follow national rules:

All such agreements in order to be valid have to be registered to the Registry of the Industrial Property Organization (OBI-http://www.obi.gr), within one month from their effective day (Law 1733/1987 “Technology Transfer, Patents and Technological Invention”, article 21-22).

The cost of the result development and use through this agreement is set by the owner-developer and in this case the working team of the research unit has estimated it for 50.000€

3d Potential products will be marketed:

• To regulated markets (e.g. heat supply, water supply, universal telecommunication services, agricultural products, fishing industry, architectural services)

• To markets operating on the principle of free negotiation between agents on the market

The market is operating on the principle of free negotiation

SECTION 4: Indicators

Estimated cost of the new products Average cost of 25.000€ for every new product for customisation and installation
Expected market volume (potential / maximum number of users) 4.000 units-incubators
Expected sales volume 60 units or3.000.000 €(60 units per 50.000€ each)
Expected market share of the company (proportion between sales and total company sales in the relevant market) 1,5% (60 out of 4.000 )

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