* The Sensor Industry 1-2 pages on actual sensor industry status & trends... impact of Internet of Things.....
    * Market Structure Illustration & Explanation of how the simulation's sensor market is organized; determinent product attributes; Consumer preferences & decision-making criteria
   * Market Demand How many sensors consumers want to buy-- by segment across the next 8 years..
   * Market Dynamics Depict & document yearly segment drift -- as measured by advancements in sensor size & performance...  & consumer  ideal expectations
   * Market Segment $-Value Evaluate the potential-$-value of each segment-- Based current vs. potential vs. probable contribution margins of each segment
   *  Market Situation Analysis Delineation/Summary of key facts, conclusions & recommendations


i.e. Traditional Segment--Consumer Buying Criteria & Weightings...







2)  MARKET DEMAND (Segment Size & Growth):

Calculate the level of consumer demand for sensors in each segment of the industry for the next 8 years:

( @ Getting Started/ Complete Online Situation Analysis/ Demand Analysis)  

The Industry Demand Analysis will help the Marketing and Production Departments understand future demand. Marketing can use the total demand for each segment as it creates forecasts - Production will use the results when making capacity buy and sell decisions.

You will need the Segment Analysis reports (pages 5 - 9) of The Capstone Courier for Round 0... Multiply the Round 0 demand by the growth rate ... This will give you the estimate of Round 1 demand.

If the Traditional growth rate is 9.2%. Convert the percentage to a decimal:

 Traditional Segment Growth Rate = 9.2% = 0.092,  Add 1 to the decimal: 1 + 0.092 = 1.092

 Then multiply Round 0 demand (7,387,000 X 1.092) the result equals your estimate of Round 1 demand.... 

  •  Produce a line chart that depicts the segment demand trends 


 3) MARKET SEGMENT DYNAMICS ( Drift Trajectories ):

step 1- Find the co-ordinates for each segments performance & size position in each round:

step 2- Add or Subtract the offset distance from the center to ideal spot:


step 3- Enter that figure into your new table listing the Ideal Spot co-ordinates for each segment- for each round:



Analyze/ Evaluate the Current, Maximum & Probable Contribution Margin Potentials for each of the 5 Sensor Market Segments:

1st) Calculate Current Contribution Margin (@Getting Started> Complete Situation Analysis> Margin Analysis)

*Calculate the Contribution Margin:   = Price - (Material Cost + Labor Cost)

*Calculate the Margin Percentage:   = Contribution Margin / Price

Use Round 0 Price, Material & Labor costs (PAGE 5 CAPSTONE COURIER)

Current Margin
Product Name Price Material Cost Labor Cost Second Shift (Y/N) Contribution Margin
$                               %
Low End
High End










  Next - Calculate the Maximum Contribution Margin-- go to the Buying Criteria on the Segment Analysis pages of The Capstone Courier for Round 0 to find the maximum permitted price and the minimum acceptable MTBF (Mean Time Before Failure) for each segment (lowering the MTBF decreases material cost).

Determine the minimum Material Cost per segment using the following equation:

Minimum Material Cost = [(Lowest Acceptable MTBF * 0.30) / 1000] +
Trailing Edge Position Cost from the
Material Positioning Component Costs table below.

Determine the minimum Labor Cost for each segment. Assume a base labor cost of $11.20 ($11.20 is a rough estimate of labor cost used solely to illustrate the Margin Potential Concept).

Minimum Labor Cost = [$11.20 - (1.12 * Automation Ratings Below)] + 1.12

Material Positioning Component Costs
Trailing Edge Cost Leading Edge Cost
Traditional $3.80 $7.80
Low End $1.00 $5.00
High End $6.00 $10.00
Performance $4.50 $8.50
Size $4.50 $8.50









Maximum Margin Potential
Product Name Maximum Price Minimum Material Minimum Labor Second Shift (Y/N) Contribution Margin
 $                                   %
Low End
High End


Finally  - Calculate the Probable Contribution Margins:

Use the more probable/competitive pricing , material and labor costs....   for each segment... accordingly.. low end brands will be lower priced... hi-end brands will be less automated & have  higher quality materials...

Product Name Probable Price  Probable Material Costs   Probable Labor Costs Second Shift (Y/N) Contribution Margin
$           %

Low End
High End

5) Summary findings, key facts, observations, conclusions/recommendations...

 -- drawn from/based on above analyses