Suki

A Service-augmented
product venture

Proposal By

Catalina Caicedo Daniel Cheon Daniel Labios Simon Zhu

Goo goo!
(Translation: hi!)
Suki is an ergonomic,
customizable baby carrier

and more ...

1
Thank you for considering Suki as part of your investment portfolio.

Suki is a Red Dot Award winning baby carrier. It is also the flagship product of our
venture that bears the company name. Over time, the company’s offering will grow
from a single baby carrier to an expansive product line of ergonomic and modular
products that are produced and circulated through sustainable practices. The
products will also be bundled with internet-based educational services.

What follows is a summary of the business plan that the company will move forward
with for the next three years.

We are currently seeking 1.5 Million USD for capital expenses and an additional $1
Million for first-year burn, totalling of $2.5 Million.

2
The industry is growing
The global retail sales for baby and related products have exceeded 350 Billion dol-
lars, and is anticipated to maintain a compound annual growth rate of 6.25% going
into the 2020s. Though the overall (geographic) competition is high, as population
and birth rate increases across the world, there is enough growth in the market for
new entrants to exploit.

Furthermore, the baby product market is unique that most consumers are first-time
purchasers, and will then subsequently semi-permanently exit the market. Hence, a
differentiated offering that goes beyond the product, that of which holistically touches
the family-starting experience backed with credible reputation and positive relations
will ensure our success.

+
5 0B
4
225B. 245B. 295B. 350B.
CAGR 6.25%

2007 2010 2013 2016 2021

3
Recent industry trends shine hope
Big-name brands of the market have been losing market share steadily. This is largely
due to the millennial generation often seeking for products and services that are
catered exactly for them, and presenting resistance towards generic, cookie-cutter
offerings.

In respect to this trend, the baby carrier and stroller subindustry in particular is divided
by many small firms competing for similar consumer base, and most focus in broad-
stroke marketing strategem to reach their diverse audience. This approach, although
good at maintaining a broad audience, fails to maintain long-term brand recognition
of the base, leaving a gap to be exploited.

Suki aims to target the rising millennial generation by employing trust and relationship
oriented marketing backed by independent influencers and transparent sustainability
initiative, all the while offering customizable and ergonomic products of superb
reliability.

26.7%

21.3%

17.9%

2013 2017 2021

Johnson & Johnson’s Share Global Baby Care Market

4
The competition
In the baby product industry, there are many competitors depending on the specific
market a company is going into. In the case of SUKI, we are going into the non-
consumable products of the baby product market. The competition in this section of
the industry is huge, nowadays startup companies are very popular for new parents.

The main competitors for SUKI are Stokke, Baby Bjorn, Bugaboo, UPPAbaby and
ErgoBaby. These companies are our main competitors in the baby product market,
some of these companies, like Bugaboo, and UPPAbaby are companies that
their main or only products are strollers. These companies wouldn’t become our
competitors until the rest of our baby products, like strollers, high chairs, and car
seats, became part of our business. Until then, Baby Bjorn, ErgoBaby and Stokke are
our main competitors. They are companies that are very well known by families and
parents that have had children or know of them because of family and friends.

# of Video Views Facebook Product Price Size of Company

on Youtube Followers Range $$ (employee count)

Babybjorn 31,402,426 179,609 20 - 100 51-200

Lille Baby 664,840 314,968 150 - 120 11-50

Moby 3,720,089 79,334 20 - 50 11-50

Ergobaby 7,377,433 4,218 180 - 120 2-10

Stokke 7,700,257 998,801 200 - 150 201-500

Baby K'Tan 2,375,385 40,927 50- 2-10

Boba 3,718,793 286,197 40-140 11-50

Infantino 906,796 62,299 20-40 51-200

5
 # of Video Views on Youtube

Size of Company Facebook Followers

Average Baby Carrier Price

Competitive landscape

6
Target segment
End users in the baby product industry are parents. In the case of SUKI, our end
users are Millennial parents. Millennials are the generation that was born between
1981-2001. The Millennial generation is generally marked by an increased use and
familiarity with communication, media, and digital technology.

Millennials are not only our target market but they are going to be our end users.
We also have to target family members and friends for when they are going to buy
gifts. But the end users at the end are Millennial parents; they are the ones buying,
receiving, and using the baby products. From carriers to strollers to high chairs.
Millennials are a generation that follow trends and health.

Research shows that Millennials are environmentally conscious. We found out that
Millennials are more conscious of the effect on the environment of the decisions they
make more so than the previous generations. When Millennials are making decisions
of what to buy, they tend to be more mindful of the environmental impacts by the
materials and processes involved in the production and distribution of the products.
Millennials also tend to be more conscious about recycling of the materials.

To serve a customer base that is committed in purchasing exactly what they want
and need, we must offer meaningful and relevant information about our offering in
attractive presentation through accessible channels.

7
 Gain

Jobs

Care for my child’s needs

Find safe baby care products
Teach myself child rearing
Give enough time at work
Coordinate with other
caretakers
Plan for my child’s future
Finding enough tme for everything Keep a healthy life style
Raising my child the wrong way
Which things will I need
Not knowing what my baby will need
Others around my child raising him
Which advice is good advice

Pain

Customer profile

8
Service offering
This diagram encompasses different services and goods that will be
offered by the company. In the beginning, we will offer our flagship baby
carrier product through our online only store. Following up with Suki’s
success, we will expand our offering with a variety of proprietary, non-
consumable baby products like strollers, car seats, and high chairs. We
will also expand our offering with other enhancing/promotional services.
After several years in the market, we plan to partner up with hotel chains,
airlines and car rental providers. Through the partnership, customers of
hotels, rental cars, or airlines can try our products all the while having the
benefit to travel without all their big baby products. In this way, parents
can have free hands and have better experiences when going on trips or
vacations, on Suki.

9
 enhancing

how-to tutorials
enabling

recall service
core

education for
parents and care
logistics
takers

digital service proprietary

non-consumable new product
platform
baby products warranties

digital educational
web hosting material

“magazine” baby registries

informational
pop up stores
content

hotel chains
customization of
products

partnerships

trial by payment
plans

airlines

second hand

online car rentals

degree of
accessibility

refurbishing

rentals customization
of products

degree of
participation
community
support

reviews

product
registration
online store
quality of
interaction Service offering
brand

customer
support

10
Service System
This diagram visually shows the relationshiops
of stakeholders within our service system.
The solid line indicates the direct interaction
between stakeholders. The dash line
indicates the indirect interaction between
stakeholders.
Charity organization

Review aggregators

Customer
Bloggers/ volggers

Local representative

11
 Supplier
Recycling companies

Manufacturing &
distribution

Suki
Technical support

Suki

Service system

Financial institution

12
Product cycle

We are dedicated in conducting our business as sustainably as possible. We

developed the stainability initiative based on the idea of the circular economy
model, which minimizes wastage by directing used products back into the recycling
loops. This system must be supported through our long-lasting design, repair, reuse,
remanufacturing, refurbishing, and recycling system.

We anticipate that some customers will return their purchases once the business is
operational. The returned products will re-enter the market as re-shelfed, “like-new”
products once we build sufficient inventory in the first year of operation. By year two,
we should be able to even sell the used products, as we incentivize customers who
no longer need their products to send them back in. With the help from our third-
party recycling company, we can build inventory of broken/used products that are
in poor condition. Once they reach a critical mass, we can begin to harvest different
components of the products and send the functioning parts for reassembly and
selling as refurbished products at attractive price points.

By employing this model on our business, we will not only reduce the amount of
waste that ends up in landfill, but also dramatically extend the fiscal life cycle of our
products. Additionally, we are hoping to raise the environmental awareness within the
industry and lead as a positive example for our competitors to follow.

13
 3rd year 2nd year 1st year Incineration & Landfill
Parts Manufacturing

Collect for refurbishing

Dissassemble

Product Assembly User

Sell as used Reshelfing

Product

Like-new product

Used-good product

Distribution Refurbished product

Producrt cycle

14
Brand identity
Here at Suki, we understand the struggles, the responsibility, and most importantly, the joy of raising a
child, which is why we are committed to support the loving bond between parents and their children.
We believe in making the difference of child care becoming from routine to a meaningful and joyful
experience. Suki is also a design-driven company that values high level innovation. Therefore, we will
constantly look for innovative solutions and improvements based on our rigorous safety and quality
standards and by learning from the community. We will make sure that we not only develop safe
products but also provide parents with good information through our online platforms.

Suki is also committed in reducing waste and keeping resources in use for as long as possible by
extracting the maximum value from them whilst in use, then recover and reconstitute products and
materials at the end of their life cycle.

In the consumers’ perspective, we are noticeably differentiated by:

1) our unique product offering, i.e. baby carrier with back support system and the rental to ownership
program.

2) streamlined process, which lower the cost of manufacturing, and increase the efficiency for every
service touch point. i.e. outsourcing manufacturing and bundling it with the majority of the distribution.

3) We have a rigorous safety and quality standards to follow, and we always strike to provide the best
customer experience.

4) Our operations are made sustainable by reusing, refurbishing, and recycling products and materials.

5) We support the community through co-creation with our users, so that we may learn from the
communities and the users to improve our product and service quality.

15
 Why

To support the loving bond

between parents and child
through our products
Who What

We are enthusitic, Co-ceate with our

sustainbale about design custoemr to help their
and the quality of the families blossom into a

Suki
product wonderful nuclear
community

Values Reasons to believe

Trustworthy
Innovative Streamlining process
Sustainable Reliability
Reliable Sustainability

Brand identity

16
Business model
Based on our insights generated from industry and market research, we decided to
base our business model on some of the best performing online baby brands such as
Baby Bjorn and Stokke. These brands rely on their online platforms to sell their baby
goods and conduct a significant portion of their marketing by being active members
of the online parenting community.

As such, our value propositions, distribution channels, and customer relationships are
very similar to these other firms. We offer 2 complimentary value propositions. The
first offering is our baby goods. They are distributed to our customer base through
our online store. To differentiate ourselves from the competition, we offer our baby
goods either New or used, with the ability to pay either full price upfront, or spread
out through a payment plan. Product customization, warranties, and other options are
also offered. The second offering are our articles, videos and other media, created
by our writers, centered around sustainable parenting. This is free content that is
distributed through our online sphere - a collection of our social media platforms, and
our dedicated website. Our customer base is made up of Millennial parents, their
friends, and their relatives. Overall, we are striving to foster a close relationship with
our customer base, by being active members of the online parenting community.

Another significant aspect of our business model takes inspiration from the concept
of product life extension, and the circular economy. A key part of our business is
taking back used baby goods from our customer base, and either refurbishing them
for resale, donating them to charity, or recycling them. We’ve positioned ourselves
primarily as an eco-friendly alternative compared to our competition - and our
customer base resonates with this. To support this, one of our key activities is the
receiving, recycling, and refurbishing of our brand of baby goods. We will also need
to foster a partnership with recycling centers and charities in order to complete
these key tasks. In this sense, each rented product is a greener choice compared
to our competition. A strong aspect of who we are at Suki, is our commitment to
being a leader of sustainability, and an enabler of eco-parenting and sustainable
consumerism as a whole.

17
Business model canvas

18
Marketing strategy End of service +
Supporting continual use
Collecting feedback &
pushing promotionals

Suki will rely heavily on independent content

creators at the beginning of the service to better
reach out to the Suki’s target customer segments
and build a relationship with the customer in the
community. Customers are expected to have
high expectation built up during their research
& planning, making the point of purchase an
important moment of truth. Once the customer
reaches the “point of purchase”, our efforts
must ensure that the process is easy to use and
understand, while mitigating any pain-points. We
also need to provide good support all the way to
Initial exposure
the end of service; thus, Suki will rely on the social Expanding exposure;
media, online store, and as well as the content building rapport
sphere to build the relationship with our customers
Informing, teaching, &
even after the purchasing. At the end of the eliciting exploration
service, feedback is gathered, and a continuous
relationship is emphasized with our customer base. Supporting research,
building rapport

19
 Post customer support
Supporting continual use
Granting easy access to
policies
Providing support;
troubleshooting; guides
Collecting feedback &
pushing promotionals

Suki Point of purchase

Streamlining purchase
Providing support;
troubleshooting;
guides

Contentsphere

Online store

Customer support

Research & planning Social media

Informing, teaching, &
eliciting exploration
Supporting research,
building rapport Marketing strategy

20
Pricing

Thanks to the circular economy strategy, we are able to offer variable

price points with a single product in the production line. The rental-to-
ownership program, dubbed “Trial by payment” will be offered as a
simple credit card installment scheme with the option to cancel at any
point. The reversed teaser rate structure will incentivize the customers
to stick with paying through the six-month period, further maximizing our
products’ revenue potential.

We will also offer a “Like new” option - products that have been
re-shelfed due to a customer returning their product within short period
of purchase that is otherwise brand new. It is not customizable and the
price may fluctuate as it has to be adjusted based on state of the
inventory and the market.

21
 PRICING STRATEGY

Full Price Trial By Payment

New $199.99 Used - Good $139.99

1st $40 $30

New $199.99
2nd $40 $30

3rd $40 $20

4th � : $40 $30 $20

Used $139.99
5th $30 $20

6th $20 $20

Pricing strategy

22
Finance and projection
The company will be based in South Carolina to benefit from the generous corporate
and sales tax rate. Part of our strategy entails selling re-shelfed and used products
to extend their life, and sales tax is not applied in South Carolina for said products,
which makes our offering more attractive to budget-sensitive buyers.

We project that with proper marketing, we should be able to clear 10,000 units sold
in the first year of operation, and expect sales figure to climb from there on. By end of
fiscal year two, Suki should be able to turn a profit and financially stabilize. There are
also additional revenue stream opportunities once we reach a big enough customer
base whose usage data we can monetize.

2018 2019 2020

Revenues $2M $2.8M $4M

Costs $2,590,000.00 $1,786,000.00 $2,110,000,00

-$619,500.00 $343,800.00 $1,795,500.00

-$590,000.00 $1,014,000.00 $1,890,000.00

Tax $29,500.00 $50,700.00 $94,500.00

-$-619,500.00 $963,300.00 $1,795,500.00

23
 Estimate of Profits
2018 (First year)

$74 per unit 10,000 total units 20 employees

+ +
$740,000 manufacturing cost $1,500,000 capital
sunk investment $30
$350,000 salaries

$30
$20
$20

– $20
$20
$2,000,000 revenues $2,590,000 costs

-$590,000 profit

Estimate of profits

24
Measuring success
Our target segments’ receptiveness to our brand identity is the
foundation of our strategy. Hence, we must be abble to measure the
success of our stainability initiative and communications. Once the
communication is received, the results of these factors will be vali-
dated through audiences’ reaction in social media avenues, and finally
through sales.

The following page lists some of the Key Performance Indicators that
help meter our success in these grounds and mocks up a dashboard
that would keep the information updated for easy viewing.

Most KPIs, including the sales figures and revenue can be identified
from analytics collected from our website and social media presence.
They are readily available and can be collected on-demand. On the
other hand, Material repurposing, Innovation roadmap and review fig-
ures have to be collected and updated manually, but the process itself
is not overly complicated.

25
s
27
KPI dashboard

28
Supporting the loving bo
between children and pa
ond
arents
Ga ga!
(Translation: Bye!)

Suki at its heart is about exploiting the condition of the market, where companies
overall care little about understanding how the current generation goes about making
purchasing decision. The reality is that absolute superiority in product quality is
difficult to achieve, and proving said superiority even more so. Hence, Suki has to be
all about using empathy to reach out to our target segment in a way that resonates
with them, and build a relationship based on trust which would then lead to a sell.
Suki’s differentiated offering goes beyond the product by holistically touching the
family-starting experience backed with credible reputation and positive relations that
ensure our success.

All of this translates to Suki being prepared to pivot its strategy when the time comes.
Although we project the company would be quite profitable for its size, we believe
that should this business become reality, we must divest great portion of our profit
into design projects and research so we can capture more of the market with new
exciting products.

If successful, Suki will become a disruptive leader in a competitive industry through

on-going product innovations and sustainable practices.

Thank you for your consideration.

Signed,
The Suki Team

31
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34
Suki
more than just product