PM101 Team 1 Final Report CURRENT (1)

Dr. 3D Labs Business Proposal

Prepared April 10, 2016 by: Sarah Bray, Halley Davidson, Sam Breiter, Tyler Schlensker and Wentoa Chu

Table of ContentsIntroduction

Dr. 3D Labs Overview

Marketing Strategy

Dr. 3D Labs Operations

Competitor Analysis ....................................................................................................... Demand Scenario: Competitor Benchmarking

Demand Scenario: Tourist Attraction Benchmarking

Forecasted DemandFeasibility of Dr. 3D LabsConclusion …………………………………………………………………………………………………………….....References ………………………………………………………………………………………………………………..

The 3D Printing Industry ……….………..………………………………………………………………….The Children’s Retailing Industry .……...……………………………………………………………….

The Dr. 3D Labs Experience .……………….………………………………………………………………The Target Market ………………….………………………………………………………………………….The Ideal Location ………………………………………………………………………………………………Times Square Consumers …………………………………………………………………………………..

Marketing to Children ………………………………………………………………………………………..General Marketing Strategy ……………………………………………………………………………….Marketing for Opening Day ………….…………………………………………………………………...Dr. 3D as Mascot ……………………………………………………………………………………………….Subway Advertisements …………………………………………………………………………………….Marketing through the Internet ………………………………………………………………………..Brochures in Major Hotels …………………..…………………………………………………………….Overall Marketing Budget ………………………………………………………………………………….

Customer Relationship Management ..……………………………………………………………….Inventory Management …....………………………………………………………………………………Doppelganger Production ……………………………………………………………………………………Point of Sales ..…………………………………………………………………………………………………..Payroll Systems ………………………………………………………………………………………………….Security System ……..………………………………………………………………………………………….Human Resources ……………………………………………………………………………………………..

Comparison with DOOB3D ………………………………………………………………………………… Comparison Process …..……………………..……………………………………………………………...Resulting Demand ……………………………………………………………………………………………..

Comparison Among Competitors ……………………………………………………………………….Method of Comparison ……………………………………………………………………………………..Resulting Demand ……………………………………………………………………………………………..

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Appendices

Figure 1: The Growing 3D Printing Industry ..……………………………………………………………..Figure 2: The Steady Children’s Retail Industry ………………………………………………………….Figure 3: Average Consumer Costs ……………………………………………………………………………Figure 4: Tourists in Times Square …………………………………………………………………………….Figure 5: Dr. 3D Labs in Relation to Tourist Sites ………………………………………………………..Figure 6: What Kids Want in a Company …………………………………………………………………..Figure 7: Percent of Consumers Who Further Researched Advertised Products…………Figure 8: Dr. 3D Labs Logo ………………………………………………………………………………………..Figure 9: Dr. 3D Labs Flyer ………………………………………………………………………………………..Figure 10: Dr. 3D Costume ………………………………………………………………………………………..Figure 11: Dr. 3D Labs Subway Flyer …..…………………………………………………………………...Figure 12: Cost of ZOHO Software …………………………………………………………………………….Figure 13: Supply Chain of Dr. 3D Labs ………………………………………………………………………Figure 14: Estimated Cost Breakdown ……………………………………………………………………….

Figure 10: Comparison of SOHO with Times Square …………………………………………………..Figure 11: Forecasted Demand #2 …………………………………………………………………………..Figure 12: Example of a 3D Printer …………………………………………………………………………...Figure 13: Diagram of a 3D Printer Nozzle …………………………………………………………………Figure 14: Full-Color 3D Printing ……………………………………………………………………………….Figure 15: The CubePro C Printer ………………………………………………………………………………

Appendix A: Porter’s Analysis of 3D Printing …………………………………………………………..…Appendix B: PESTLE Analysis of 3D Printing ………………………………………………………………Appendix C: Porter’s Analysis of Children’s Retail ………..……………………………………………Appendix D: PESTLE Analysis of Children’s Retail ………………………………………………………Appendix E: How 3D Printing Works ………………………………………………………………………….Appendix F: SWOT Analysis of Dr. 3D Labs .……………………………………………………………….Appendix G: Dr. 3D Labs Business Model Canvas ………………………………………………………Appendix H: Marketing to Kids ………………………………………………………………………………….Appendix I: Marketing Mix of Dr. 3D Labs ………………………………………………………….…….Appendix J: Graphic Design of Dr. 3D Labs ..………………………………………………….............Appendix K: Marketing Schedule of Dr. 3D Labs …………………………………………………….…Appendix L: Dr. 3D Labs Brochure Appendix L: CRM Systems ………………………………………………………………………………………..Appendix M: POS Systems ………………………………………………………………………………………..Appendix N: Cost Estimation Process ……………………………………………………………………….Appendix O: Payroll Systems …………………………………………………………………………………….Appendix Q: Job Postings …….……………………………………………………………………………………Appendix R: Dr. 3D Labs Mock-Up …………………………………………………………………………….

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After researching various industries, costs of business operations and customer demographics, PM 101 Team 1 has developed the business of Dr. 3D Labs. This company fulfills the objective of targeting children ages 0-14 in the children’s retail or entertainment sector. That being said, Dr. 3D Labs stands out with its innovative and unique concept. It aims to combine the stable toy retail industry with the blooming industry of 3D printing. At its core, Dr. 3D Labs is a children’s toy retailor. Where it differs, however, is the use of 3D printing to create a customized toy tailored to each child’s dreams. It does not truly fit into either industry, but is rather a new combination of the two.

Dr. 3D Labs is a business that hopes to capitalize on the low production costs of 3D printing to become profitable. It is a business that will target an age range of children who are at their peak of creativity while maintaining a love for toys. Finally, a location with a high volume of tourists will benefit the once-in-a-lifetime experience Dr. 3D Labs offers.

The 3D Printing Industry:The 3D printing industry as a whole is in its early stages. With rapidly changing standards in technology, discussed in Appendix B on page 15, it can be difficult to even define. The sector that relates the most to Dr. 3D Labs is 3D Printing &

Rapid Prototyping Services. Shown in Figure 1, the industry is currently valued at $492.4 million (IBISWorld, 2016). Also seen in the chart below, the industry is growing at a high rate. In the last 5 years, this industry has averaged 22.6% in annual growth. It is also expected to maintain at least a 10% growth rate through 2020. Comparing this to the 5.9% growth rate of the US economy (World Bank), research indicates that the 3D printing industry is very healthy.

Discussed in more detail in Appendix A on page 15, the 3D printing industry is highly competitive. 151 businesses are considered part of the market. Of these business, the majority of profits are generated by only a few. The two major competitors Stratasys and 3D Systems account for 30.8% and 24.0% market share, respectively (IBISWorld, 2016). These companies, however, focus more on selling the 3D printers themselves.

The 3D printing industry is much more of a niche market than other more developed industries. Part of the reason for this is how the technology fueling it is not yet mature. Current 3D printers are more suited for smaller-scale ‘hobbyists’ projects than widespread manufacturing. The printing time for complex designs can easily take hours, if not days (3D Genius). On top of the long printing time, the software needed to operate the printers can be difficult. Not every 3D design is suitable to be

Introduction01

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Key Takeaway: The 3D printing industry is growing steadily and rapidly. Its projected revenue is below $1 billion, but it is because of how new the industry is. If growth continue as it has been, it can easily outshine other more-developed industries.

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printed, and designers must take that into account while creating. The industry operates roughly under the “golf ball rule”. It states that if a planned product is equal to or less than a golf ball in size, it is an ideal fit for the industry (Zaleski, 2015).

The 3D printing industry is a recently developed market, only getting its true start around 15 years ago. Although it does not generate as much revenue as other industries, the rapid growth discussed in the earlier sections shows promise. The unique opportunities it presents with customized and low cost products is ideal for a start-up. Inexpensive yet effective options for printers are readily available. It will take time, however, for the 3D printing industry to truly mature enough to generate comparable revenue to other industries. Companies who enter the market now can become forerunners in this exciting new market.

Children’s Retailing Industry:Compared to 3D printing, the children’s retailing industry is much more developed. Seen in Figure 2 above, the industry was valued at $18 billion in 2015. The industry saw 0.3% average annual growth for the last 5 years (IBISWorld, 2015). This is partially attributed to the rise in disposable incomes in families. Shown in the chart above, the children’s

retail industry has struggled increasing its revenue. It suffered a drop in 2014 and has been recovering since then. However, the industry is projected to grow at a slight but steady rate to reach over $20 billion by 2020.

This billion dollar industry has a few major companies that dominate a large amount of the market. The two largest are Wal-Mart and Toys R US with 33.0% and 11.4% of the market, respectively. However, the remainder of the revenue is generated from business with less than 4% of market share (IBISWorld, 2015). This research indicates that relatively small businesses can still earn profits in certain areas. Although, there is a high number of competing smaller businesses. This is due to the low barriers of entry, discussed in Appendix C on page 17.

One of the largest factors acting on the children’s retailing industry is the growing trend of online shopping. Detailed in Appendix D on page 30, technology is becoming more prevalent in the lives of consumers. As internet access grows, more people are completing their daily tasks on the internet. Over 70% of parents first find a toy online before purchasing it (NPD Group, 2009). That being said, these parents still prefer to see a toy in person to make the purchase. This is mainly to make sure

Introduction02

Figure 2: (IbisWorld)

Key Takeaway: The children’s retailing industry is growing steadily but slowly. After its dip in 2014, it is expected to fully recover. Shown in the graph, the expected rate of growth through 2020 is between 1% and 2%. This shows how the industry as a whole is fairly stable.

the quality is satisfactory and the toy would be a good fit for their child. Overall, online presence of toy manufactures is predicted to be increasingly important (IBISWorld, 2015).

The children’s retail industry is a mature industry, growing at a slow but steady rate. Research indicates that it is very possible for companies to turn a profit in this industry. Because of this, it is fairly competitive and small businesses can not truly compete with larger ones. Combining the profits from this well-developed industry with the rapidly growing interest in 3D printing is a perfect opportunity for success.

The Dr. 3D Labs Experience:The simplified concept behind Dr. 3D Labs is the creation of a customized action figure. Children first select the type of body and accessories for their action figure. Then through 3D printing technology discussed more in Appendix E on page 19, their head is scanned, printed and attached to the rest of the doll body. In a way, this toy represents their ideal self. Whoever or whatever they wish to be comes to life through Dr. 3D Labs.

Dr. 3D Labs is about more than a custom child’s toy, it is a unique experience. Like other similar creation studios for children, the location will have a central theme. To reflect the innovative nature of Dr. 3D Labs, the store will be decorated as a futuristic science lab. From the shelving units to the front entrance, everything will resemble a high-tech lab. Children enter through pillars pulsing with electricity. Bright lights and colorfully lit machines will be scattered throughout the store. As a final touch, strategic placing of fog machines will add an element of mystery to the overall environment. A mock-up of the Dr. 3D Labs space can be found in Appendix R on page 37.

Below, an excerpt from the Dr. 3D Labs website describes the story behind the experience:

From the beginning, children are treated as subjects in Dr. 3D’s experiments. Employees acting as his henchmen will guide the children step-by-step through the creation of their action figure. First, the children are ‘cloned’ in order to initiate the reinvention process. After being scanned, theythen select a body and accessories for their future doppelganger. These themes vary from superheroes to princesses, athletes and others. Finally, Dr. 3D’s stooges will help children complete an experiment file for their action figure. This summarizes all selected components, partially to help track costs, as well as a biography detailing all aspects of their toy’s life. To complete the experience, children send their experiment file away for their doppelganger to be brought to life and picked up a few hours later.

The Target Market:The key age demographic for Dr. 3D Labs is 6-11 year-old children. This age range was selected partially based off competitors, such as Build-a-Bear Workshop, and their main market. Althoughcompanies such as Build-A-Bear Workshops are not an exact representation of Dr. 3D Labs, they are similar enough to use as a comparison. An estimated 60% of their sales are to families with children between 3-12 years old (10K, 2014). By pursuing this demographic, their revenue has grown in the past year. It is worthwhile for Dr. 3D Labs to pursue a similar age range of children.

Dr. 3D Labs Overview03

Many years ago during one of his crazy experiments, Dr. 3D had a terrible accident. While trying to clone himself, the machine malfunctioned and his head grew so big it fell right off. In a panic, Dr. 3D tried everything he could to replace his head. Basketballs, watermelons, boxes....but nothing worked. Then it hit him, he should try the new technology of 3D printing! Scanner in hand, Dr. 3D made a quick copy of his old head and created a brand new one for himself. This new head fit so perfectly that he decided to share his discovery with the world. He put out ads for new stooges, and with their help founded his very own lab for everyone to visit (http://dr3dlabs.my-free.website)

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“Through a unique and innovative experience, inspire children to always believe

in their dreams”-Dr. 3D Labs

http://dr3dlabs.my-free.website/



Additionally, 6-11 year-olds were selected because of their interest in the experience Dr. 3D Labs. Children ages 6-9 most enjoy playing with toys that help them simulate adult or dream life or scenarios (KidSource, 2009). This interest perfectly reflects the experience Dr. 3D Labs offers. Children get to turn their image into whatever type of action figure they want. This allows them to fantasize about their dream ‘job’. Children within this age range also have a greater interest in themed toys than other ages. Around 90% of parents with children under 11 years old purchase character-themed toys [e.g. superheroes and princesses] within the last year. As children get older that percentage drops to only 50% (Lipson, 2015). Dr. 3D labs would benefit more from targeting younger children than older ones. Another key demographic of Dr. 3D Labs is families with a high disposable income. This is because of the higher costs for consumers to purchase these action figures. The expected price for a basic doppelganger is $64.99, with more advanced models costing above $75. Compared to the other 3D printing businesses shown in Figure 3, it is one of the least expensive options. That being said, it is more expensive than other children’s toys. Families need to be able to spend within the $60-$100 cost range for Dr. 3D Labs. Lastly, families with disposable income are more likely to go on a families on vacation is important.

The final demographic Dr. 3D Labs aims to reach is tourists. Part of the reason is that Dr. 3D Labs is not a repeat experience. Although consumers may return for different accessories, they are not expected to purchase another doll. DOOB3D, a similar business, reported that most of their customers only ever purchase one figure (Patrick, personal communication). Because of the lack of repeat purchases, tourists are ideal since they are only in a location for a short period of time. vacation. Discussed in the next paragraph, targeting Another benefit of tourists is that they are a constant source of the target age group. 83% of people planning vacations are families (TripAdvisor, 2011). With so many families traveling, tourists are an ideal demographic. A final benefit of tourist is

their spending habits. Typically, people tend to spend more money on vacation than any other time. A reported 36% of families spend at least $600 per person while on vacation (Westley, n.d.). Dr. 3D Labs can capitalize on this increased spending and charge a higher price. Also, Doppelgangers cost more than other action figures, so the demographic must have a true interest in the product. By offering an experience beyond the toy, it appeals to tourists searching for entertainment.

Dr. 3D Labs will target children ages 6-11 who are part of tourist family with a high income. Because of the unique experience Dr. 3D Labs offers, the prices will be greater than other toy stores. Families must be willing and able to make a purchase, but their children must also have an interest. By targeting these three demographics, research indicates that Dr. 3D Labs will earn a profit.

The Ideal Location:When searching for a location, Dr. 3D Labs would benefit the most from a top tourist destination. As stated before, tourists are a key demographic this


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Key Takeaway: Purchasing a 3D-printed doll can be very expensive. Some companies, such as DOOB3D, can charge $100s for this product. Comparing Dr. 3D Labs to other companies, it will appear more affordable to the average consumer.

Figure 3: (Competitor Websites)

company will target. A location within Times Square was selected because of the potential in the area. Times Square is one of the top tourist destinations in the world. Every day, over 300,000 people travel through this location (Times Square Official Website, 2016). Shown in Figure 5 below, the influx of tourists is almost constant. Over 30 million people travel to Times Square every year (Statista, 2016). A location with a high density of constant tourists would benefits Dr. 3d Labs greatly.

Another promising aspect of Times Square is the area’s spending tendencies. The consumer spending in the area is higher than any other surrounding locations in New York. While Times Square only makes up 0.1% New York’s physical lands, it accounts for 10% of the city’s economic output (HR&A Advisors, Impact of Times Square, 2012). The estimated retail revenue from tourists annually is $1.7 billion dollars (HR&A Advisors, Times Square Retail Study, 2011). Because the spending is so great in Times Square, it is ideal for Dr. 3D Labs. Discussed before, it is crucial that the potential buyers are willing to spend between $50-$100 for this once-in-a-lifetime experience.

Despite the high spending levels in the area, there

are not a substantial amount of toy retailing

competitors. In 2015, Toys R US closed from its Times Square location (Ryan, 2016). They did not close because were failing as a business, but because their rental costs grew to be too high. In 2015, they were paying $18 million annually to continue operating at their location (Ryan, 2016). The closing of this major toy retailer opens opportunities for smaller business to gain a hold in the local market. Stores such as Dr. 3D Labs can thrive without major competition in the area. They key, however, is to reasonably plan for the expensive location rates. The location Dr. 3D Labs choose is smaller than surrounding areas, at only 2,600 square feet. This is to help maintain manageable levels of rent. Though, It is enough space for the Dr. 3D Labs concept.

For the reasons discussed above, Dr. 3D Labs selected a location in central New York. The location is shown in green in Figure 6 on the following page. 167 West 47th street is close to many prime tourist spots. Particularly, it is only 0.1 miles away from Time Square (Google Maps). It is expected the Dr. 3D Labs will benefit by being so close to many major tourist spots within New York.


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Key Takeaway: New York is a very popular tourist destination. Shown in the chart, the amount of tourist annually is fairly stable. Although the amount does dip occasionally, it always recovers in the following years.

Times Square in New York is a perfect location for Dr. 3D Labs. The area has very large amounts of tourism as well as high levels of spending. If Dr. 3D Labs can develop interest in the business idea, there will be no shortage of daily customers. That being said, this company must be wary of rising renting costs in the area. It is crucial Dr. 3D Labs balance its costs well in order to still earn a profit.

Times Square Consumers:As mentioned in the earlier section, Dr. 3D Labs local market is the tourist hotspot of Times Square. Catering to tourist is extremely important for this business to succeed. In general, tourists are looking for unique opportunities during their vacation. They also enjoy , with 51% describing shopping as theirfavorite vacation activity (TripAdvisor, 2013). Dr. 3D Labs offers a distinctive experience while still being considered a retail store. It is a perfect match for tourists.

Another factor of tourist consumers in Time Square is the amount of hotels. 21% of the hotels in New York are in Times Square alone (HR&A Advisors, Impact of Times Square, 2012). This is beneficial to Dr. 3D Labs’ concept because of the company’s technical limitations. 3D printing a head is estimated to take 3 ½ hours (3dpartprice, n.d.). If the consumers are staying in nearby hotels, it will

not be as much of an inconvenience to return later. The long printing time will not act as a deterrent as it would if people had difficulties returning. In order to appeal to consumers in Time Square, it is important to generate interest in Dr. 3D Labs’ concept. People want unique experiences on vacation, and Dr. 3D Labs can fulfill that want. With the demographics' desire to spend and the nearby hotels, Dr. 3D Labs will thrive in Times Square.

Marketing To Children:Children can be very fickle and difficult to reach consumers. With short attention spans and often irrational decision-making (Bonetto 2015), unique marketing strategies must implemented in order to appeal to them. Figure 6 on the following page breakdowns different elements children want to see in a brand. The most noteworthy is how 80% of children look for a brand their friends know about it (Bonetto, 2015). This highlights how word-of-mouth advertising is important in order to appeal to kids. This presents difficulties for smaller companies to capture children’s attention. Yet if these companies can offer such a great product or experience that kids want to tell their friends, awareness will grow. Another major element kids search for in advertising is humor (Bonetto, 2015). Because children have a short attention span, appealing to them through humor can help focus their attention.

Traditionally, television has been considered an effective medium for reaching out to children. That is not the case anymore. First, children no longer simply watch a TV program. 76% of children are doing at least one other task while watching TV (Bonetto 2015), particularly during commercials breaks. Also, TV ads are only more effective to reaffirm a child’s preexisting interest in a brand than to develop awareness of new ones (Bonetto, 2015). Unless the ad is so unique that it completely enthralls the child, it will not have a profound effecton them. More effective mediums for marketing to children are interactive platforms, such as the internet. The majority of children have internet access and use it on a daily basis (Bonetto, 2015).

Dr. 3D Labs Overview 06

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Figure 5: Dr. 3D Labs in Relation to Tourist Sites (Google Maps)

Not only are children exposed to internet ads more, but these ads offer more opportunity for interaction. Children can click on ads to learn more or even play simply games.

Although kids are the target market, it is important to advertise to adults as well. Because kids only carry an average of $26 on their person at any time, they turn to their parents when making major purchases (Bonetto, 2015). The product or services being advertised must appeal to children enough that they ask for it, but the parent must approve. However, children have such a high level of influence over their parents (Bonetto 2015) that it is more important to target the child first. Kids will try many methods to convince parents to make purchases for them. They are successful 90% of the time (Bonetto, 2015). One method they do so is searching for discounts. Almost 50% of children look for a company that offers discounts (Bonetto, 2015).For a more detailed look at marketing to children, refer to Appendix H on page 37.

The most effective way to advertise is to target both children and their parents simultaneously. The product or advertisement must be interesting enough to capture the attention of the child. It must also appeal to the parent, since they are making the actual purchase. Ads that are unique, bold and humorous are the most successful in appealing to children. They respond more to interactive and attention-grabbing mediums than other, more passive ones.

General Marketing Strategy:In order to appeal to kids, Dr. 3D Labs plans to emphasize the unique experience and fun atmosphere it offers. As stated before, it is about more than creating a toy. Children will feel like a part of Dr. 3D’s experiments. Also, the character of Dr. 3D will become the mascot. He will perform daily shows in the location and get kids involved hands on with science. It is planned to turn Dr. 3D into a character for children to become excited about, not just the face of the company.

General Marketing Strategy:Detailed more thoroughly in Appendix L on page 40,

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Figure 8: (Bonetto, 2015)

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Key Takeaway: Children search for a variety of things in a brand or product. At 80%, the largest factor kids look for is that company is something known by their friends. This highlights the need for Dr. 3D Labs to make the experience so memorable that children will tell others about it.

Figure 6: (Bonetto, 2015)

The graphic design elements of Dr. 3D Labs reflect the overall theme. Figure 3 displays the decided final logo. It was designed to directly represent the idea of a science lab. the Appendix J on page 21 shows different logo variations, as well as a central color palette. Cool hues were selected to correspond with the high-tech elements of the store. Traditionally, futuristic themes are represented with a similar color scheme. Bright and fun colors were also selected to appeal to children.

While advertising Dr. 3D Labs, “the future is you” will be used as the tagline. First, this further emphasizes the futuristic theme talked about above. It also stresses how this business is focused on the individual consumer. Each child creates a doppelganger based on their dream self. Combining these two ideas into this tagline is a perfect representation of Dr. 3D Labs.

Figure 7 compares the most common advertising channels and their effectiveness. This chart highlights the importance of mass media in marketing. Consumers generally respond more to electronic mediums. Although, print advertisements are only marginally less successful. Because of this, Dr. 3D Labs will use a combination of mass media

and more simplistic media. The company will focus on four main channels for advertising: the internet, printed flyers, posters and radio. The following sections further details each method. For more information on the general strategy of Dr. 3D Labs, refer to Appendix I on page 37. It outlines the company in relation to the marketing mix.

Dr. 3D Labs must focus on highlighting its creative experience when advertising. Also, research indicates that it is important to choose more than one channel for advertisements. This has more potential for reaching more consumers. No matter the medium of marketing chosen, it is crucial for advertisements to still reflect the fun nature of Dr. 3D Labs.


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Figure 7: (Statista, 2016)

Figure 8: Dr. 3D Labs Logo

Marketing for Opening Day:Dr. 3D Labs will not focus heavily on a campaign for the grand opening, but it will have a special celebration. As it is a party to introduce the newest in mad scientists, there is no better person to cut the ribbon than Bill Nye the Science Guy. For $25,000, Bill Nye will make an appearance to speak, meet fans and sign autographs (APB.com). Because Bill Nye is so famous and popular with children, it is expected he bring many consumers to the store. His appearance will also help spread the name of Dr. 3D Labs. Although Bill Nye will be the focus of the event, there will also be cake and decorations. This grand opening celebration is expected to cost $26,000. Also, the grand opening event will be advertised in the same manner as Dr. 3D Labs’ normal marketing strategy. Mostly, newspaper and social media will be used to generate interest.

Dr. 3D as a Mascot:Advertising through a mascot is beneficial when marketing to kids. As stated before, kids search for more interactivity and uniqueness in advertisements. Mascots provide an opportunity

for kids to interactive one-on-one with the business. Also, they “can strengthen the sense of attachment or belonging to a product or service” (Spellbrand.com, n.d.). By using a mascot businesses can evoke more emotions in consumers, who in turn will feel more attached to a business (Koshy, n.d). Because Dr. 3D Labs focuses so greatly on the story and experience for customers, a mascot is a necessity to bring Dr. 3D to life.

Dr. 3D Labs plans to purchase a customized full body costumer for the mascot. It is expected to cost $12,000 (Avantgarb.com n.d), but it is a one-time purchase. Although not the final design, Figure 10 shows the general design for Dr. 3D. He is going to be a crazy and funny yet still friendly character.

The Dr. 3D mascot will implement personal selling techniques. He will roam the center of Times Square handing out flyers and interacting with tourists. Flyers alone are not the most effective form of marketing, with only a 2% response rate (Stephen 2014). Yet by combining physical flyers with the method of personal selling, this marketing plan will be more effective. Dr. 3D Labs will pass out 500 flyers weekly, at a cost of $11,700 annually.

Subway Advertisements:Subways are a major form of transportation in New York. Many residents and tourists choose subways in order to avoid the chaotic street traffic. In comparison, the subway system is the simplest and


Figure 9: Dr. 3D Labs Flyer

Figure 10: Dr. 3D Costume

fastest way for people to commute. The Times Square subway has more annual riders than any other subway line. In 2014, the annual riders of the subways were over 1.75 billion (MTA.com, n.d.). Also, the average rider spends 40 minutes on subways each way (Billboard Connection, 2014). This allows for sufficient time for consumers to be exposed to advertisements.

Dr. 3D Labs plans to spend the majority of its budget on subway advertisements. Through OutFront Media, posters will be placed in 50 different subways. An example of the subway poster is shown in Figure 10. It was designed to reflect the same format as the flyer. Total, marketing in subways will cost $97,500 a year.

Advertisements in the Newspaper:Shown before in Figure 7, newspaper advertisements are effective. Almost 50% of readers will act on an advertisement (Statista, 2016). Of those who further research a product, 34% are likely to make a purchase (Newspaper Association of America, 2013). Additionally, the New York Times is the third most read newspaper. Over 2 million physical and digital copies are purchased every year (journalism.org, 2015). With a large amount of readers through both print and digital media, Dr. 3D Labs can reach a greater range of consumers.

Dr. 3D Labs will use a one page advertisements in the New York Times once a week. The advertisement will be the same as the flyer and will cost $24,400 per year (New York Times, n.d.).

Marketing Through the Internet:Dr. 3D Labs will have a strong online presence, the importance of which is highlighted earlier in the paper. In regards to social media, an estimated 37% of consumers will research more into a company that has a social media page (Statista, 2016). Dr. 3D Labs plans to focus the most efforts on primarily Facebook and Twitter. These pages will be updated daily with pictures, customers’ doppelgangers and updates about what Dr. 3D has been up to. Only 48 hours after the Twitter page was created, Dr. 3D Labs already had 5 followers. One of these followers was from a major 3D Printing group who retweeted the company’s first post. This shows how quickly Dr. 3D Labs can gain exposure through social media.

Additionally, Dr. 3D Labs will directly advertise through Facebook using their ad software. Facebook is great channel to reach parents. 73% of adults visit Facebook at least once a week (Salesforce, 2013). Dr. 3D Labs will target individuals who are currently in New York yet live 100+ miles away. Each click will cost cost $0.31(Facebook.com, n.d) and 50,000 clicks will be budgeted for the first year. It is expected to cost $15,500 annually.


Figure 11: Dr. 3D Labs Subway Poster

Dr. 3D Labs will also market through a personalized website. This will provide consumers an easy way to learn more about the company before purchasing. It will also offer an outlet for people to easily contact the company with any questions. http://dr3dlabs.my-free.website/. It is expected 3% of website visitors will actually go to Dr. 3D Labs (Marketingsherpa, 2012). Because the website will only cost $120 annually to maintain, it is a worthwhile method.

Brochures in Major Hotels:Brochures are an effective way to marketing to tourists. While staying at a hotel, 84% percent of tourists will pick up brochures and an estimated 80% will alter their plans after doing so (CTM, 2012). By marketing through brochures, Dr. 3D Labs can gain exposure. Smaller businesses can struggle to compete to purchase large-scale advertisements, but brochures offer comparable exposure for less.

Dr. 3D Labs will partner with CTM Media Group to market through this channel. CTM Media Group provides a service that plans, prints and distributes brochures to hotels. . This company will place Dr. 3D Labs brochures in 10 family-friendly hotels around Times Square. It will cost an expected $70 per hotel per week. Annually, Dr. 3D Labs budgets $36,400 to market through brochures.

Dr. 3D Labs Marketing Budget:Dr. 3D Labs will primarily advertising through direct marketing, print marketing and the internet. For a breakdown of the marketing schedule, refer to Appendix K on page 37. In general, the company plans to use the same level of marketing year-round. This is due to the lack of seasonality in Times Square. There are very few dates that attract more tourists, such as News Years. Below is a summary of advertising costs:• Mascot with flyers: $23,700• Posters in subway: $97,500• Marketing through internet: $15,120• Brochures in hotels: $36,400• Marketing Specialist: $50,000• Social media specialist: $40,000

Customer Relationship Management:Detailed more thoroughly in Appendix L on page 40, Dr. 3D Labs has chosen Zoho for managing customer relations. This CRM system was selected for many reasons, but the most important was the ideal balance between cost and functionality. As a small business, Dr. 3D Labs does not need a large system as its transaction are not very complex. Also, the majority of the purchases will be one-time. It is more important to track sales as related to the products instead of individuals customers. Lastly, although Zoho does not have the highest level of security it is predicted to be enough for Dr. 3D Labs. None of the information will be highly confidential in nature. With the lack of repeat purchases, no financial information of customers will be stored. Simply, the type of product they purchased. Zoho offers all the simpler functions Dr. 3D Labs requires while remaining affordable for smaller businesses. Some of the services Zoho offers are:

Dr. 3D Labs does not explicitly require every service Zoho includes, but a few are absolutely necessary. The first is sales forecasting and reports. Because Dr. 3D labs will be constantly developing new dolls and accessories, it is important to keep track of what products are selling. It will help the business decide whether to drop certain lines or focus more resources on specific new themes. The next important function is the ability to maintain unlimited records. As stated before, the primary market will be tourists. With an almost constant flow of new customers, Dr. 3D Labs can expect a large number of records. This particular version of Zoho allows business as many records as they need, so Dr. 3D Labs can recall any customer’s sale if necessary. The final major benefit Zoho offers is how the system is cloud-based. Because of the more compact location and high level of equipment needed, Dr. 3D Labs does not have room to spare. It would struggle to find storage for any physical equipment for a CRM system.

The expected cost to run Zoho is outline in Figure 12. Dr. 3D Labs predicts to have 8 monthly users


• Email Integration• Sales Forecasting• Reports • Document Library

• Mass Email

• Call Center Connection• Unlimited Records• Cloud-Based


because of how its management will function. The five founders will each have an account in order to oversee operations. In addition, 3 store managers will have access. Allowing both mid-level and higher management to have access will help avoid any oversights and aid communication. The final cost for Zoho will be $2220. This is the most affordable software and subscription for Dr. 3D Labs.

Due to the nature of Dr 3D Labs and the small amount of users, Zoho is the best CRM system. The business has no need to spend more than the cost of Zoho. The extra services these more expensive systems offer will not be used, so it is a waste to purchase them. What is most important is a cloud-based and simple to use system that can track large number of purchases. Zoho offers these services while remaining affordable.

Inventory Management:The supply chain management for Dr.3D Labs is fairly simple. Shown in Figure 13, there are only 4 major players in the suppler chain. The process begins with the manufacturer. Dr. 3D Labs plans to outsource production of the doll bodies. Outsourcing is not expected to impact the overall business because the focus is not the bodies, but rather the custom heads. Every two weeks, the manufacturer will be shipping 2500 headless 12” figures and 7500 sets of outfits to the retail space. The main storage room for products is a 12x17 space. It is expected that 48 boxes will be able to fit in the room at any one time. Each box should hold

slightly over 100 doll bodies or over 300 outfits. Dr. Dr. 3D Labs plans to store dolls in half of the boxes and accessories in the other half. With an expected average sale of at least 700 figures a week, it is important to have more than enough dolls in the store at all times. Other miscellaneous supplies will be stored throughout the store or in leftover space. Another major component of supply in Dr. 3D Labs is the printer cartridges. These specialized cartridges can only be purchased from the makers of CubePro C printers, Bot Objects. It is expected Dr. 3D Labs will need on average 900 cartridges every two week, but more will be stocked. This is due to potential printer malfunctions. 3D printers can often become jammed and must be cleaned, wasting the filament in the process.

The final step of the supple chain is getting the finalized product to customers. The interactive experience for customers will last less then an hour, although their finished figure won’t be fully created until over three. Therefore, customers will be given the opportunity to pick up their figure at their own leisure. There will also be free shipping offered to customers. It is estimated that between 90-95% of customers will choose to simple pick up the product later. This estimation is based off of The Lids Store in Time Square. They also offers a customized product with a few hour pick-up time (Bradley,

Operations 12

Figure 12: Cost of Zoho Software (Zoho.com)

(Per Month Flat Fee x 12)

(Per User x Amount of Users) = Annual

Cost

$25 x 12 $20 x 8 = $460

Figure 13: Supply Chain of Dr. 3D Labs

Manufacturer•Ships 2500 headless doll bodies to retailer every 2 weeks

•7500 accessories to retailer

every 2 weeks Retailer

•Keep manufactured doll bodies and accessories in storage space

•Other store supplies kept in leftover storage space and

around the store

Customer•Can pick up figure in store or get shipped to home

•In store pickup is a 4 hour wait•Less than 10% will get shipped homeBotObjects

•Ships 1000 cartridges every two weeks

personal communication). Even with the delayed pick-up, less than 10% of their customers choose to have the product shipped. It will cost $12 to ship via USPC first class mail, in a large padded envelope for fragile items, with insurance (USPC.com, n.d.).

The supply chain for Dr. 3D Labs is simple. It will outsource manufacturing of dolls and accessories, but will produce heads on-site. In order to help maintain a steady flow of products, Dr. 3D Labs will use software to manage what is being purchased and used. Both the CRM and POS systems will keep track of inventory. Having two systems will help eliminate opportunities for miscalculations. It is crucial enough materials are in the store at any one time to meet the daily demand.

Doppelganger Production:Discussed earlier, the estimated printing time for a doppelganger is 3 ½ hours. The majority of the process is automatic. Detailed in Appendix E on page 37, 3D printing can be run almost entirely through programs. Although, 3D Printers often jam and must be cleaned after every print. Since they are not fully automatic, a 3D specialist must be present to manage them. It is also effects print time, the estimation is only for if everything functions perfectly. That is why customers will be told an expected time of 4 hours.

The average cost to produce a doppelganger isestimated to be between $23-$29. The individual aspects of the costs are broken down in further detail in Figure 13. The process of determining the average cost is explained in Appendix N on page 23. This estimated cost only accounts for the direct cost of goods. That being said, there is still substantial opportunity to turn a profit. The cheapest model with basic accessories is planned to be sold for $64.99, with more complex models costing $74.99 and $79.99. Considering only the most basic doppelganger, there is a 64% gross margin. It is 20% greater than competitor Build-A-Bear Workshop’s gross margin of 44.7% (YCharts, 2015). These lowered costs of production highlight the potential 3D printing has to offer. Dr. 3D Labs is designed to capitalize on this potential.

Point-of-Sales Systems:Detailed more in Appendix M on page 37, Dr. 3D Labs has determined AIMsi as the best choice for a point-of-sales system. As a small business, Dr. 3D Labs needs a system that is low cost but still offers the basic functions the business requires.

Choosing the best software for Dr. 3D’s Labs means that there is criteria of saving costs, reliability, and tracking of sales and inventory. AIMsi is great for customer add-on modules offering a lesson scheduling which is great for hobby shops and very useful for rental management, and keeping track of inventory. This system is also very easy to use, learn and work with which is important with a new business such as Dr. 3D Labs. It allows for highly customizable inventory and sales reports to suit every interest of the business, which works well with Dr 3Ds lab business concept, which has many customizable portions to its business. AIMsi doesn’t consume a lot of computer power therefor making it possible for startup business to use, and meaning it would work well in a small New York City Location that has high electricity costs. This software provides the user with wide ranging customization options leading to maximum profits for each unique company. This system provides all of Dr. 3D’s Labs requirements for their POS systems, with a low one time purchase cost of $495.

Dr. 3D Labs Operations 13

Figure 13: Estimated Cost Breakdown (Alibaba; Aliexpress)

Element of Action Figure

Average Cost Estimate

3D printed head $11.16

Main body $14.83 (simple)$9.04 (complex)

Hair/Wig $2.01

Clothing and Accessories $1.07

Total Average Cost $23.28 (simple)$29.07 (complex)

Payroll System:Dr. 3D’s Lab payroll system will need to be able to calculate and distribute scheduled paychecks. The majority of the employees will be hourly based, so the system we chose should be able to compute the correct amount per the hours of worked a week, as well as making sure to account for taxes that will be deducted. The system should be easy to use for managers and accounting and other accessing it, as well as not take up space in the store.

The system that best suits the needs of Dr. 3D’s Lab is Gusto Payroll Systems. It has a low annual cost and meets the requirements for the business. Its cloud base system helps to keep hardware out of the store, and it is fully equipped with automatic scheduling and tax reductions. It also offers the ability to split annual salaries into hourly wages so that managers can have weekly paychecks. It uses a mass email system that sends pay stubs to users so that it can eliminate paper and have increased accuracy with payments and customer satisfaction. Though it does not have weekend customer service, it has a large online based service system that works from the U.S. to provide as much customer satisfaction as possible.

Security:New York City, more specifically Time Square can be a dangerous place. In fact, Time Square has the most crime in the city per 1000 people (nyc.gov, 2016). Most of this is because of how many people are clustered into one space, allowing people to get away with crime without being noticed. On the other hand though, crime rate has been consistently going down in Time Square, only have 741 total crimes in 2014, compared to having over 2000 yearly in the late 90’s.

Although, based on the risk with having high cost 3D printers and other expensive assets, Dr. 3D labs will still be implementing a top of the line security system. The Night Owl B- F93244-700 Channel Video Security System with 24 Bullet Cameras, a top of the notch $1600 product will keep the store secure. The system will be controlled by an computer, or other smart device.

How the system works is each camera is put into a different room and has the capability to view the entire space. It takes 24/7 footage and can hold up to a year worth of video. If there is a situation where a problem arises, using the Night Owl app, you can go back and see what happened. With that video proof, if someone were to steal money, printers, or anything else of value the police would be able to use the video. Additionally, with Slomin’s shield we can turn the alarm on when closed, therefore if someone sneaks in the alarm would go off, alerting us and the authorities.


Figure 9: Dr. 3D Labs Security Cameras

• Cloud-based• Automatic pay• Scheduling• Automatic tax reductions

• Mass email for pay stubs• Divide annual salaries

Human Resource ManagementIn terms of hiring, Dr. 3D labs are looking for both entertainers, and professionals. The professionals will include the Marketing Specialist, 3D Specialist’s, Doll Dress Designer, and Accountant. Although, the Part Time Employees, and Store Manager are expected to be both professionals and have some entertainment skills. Dr. 3D Labs is looking for people with a couple years experience in their field, people who are recommended and top of the line. Ideally the business would like employees to stick with the business for many years, due to it being a new business, with goals and having great company culture. Due to having a fun, and relaxed company culture having these expectations are feasible. The cost per full time employee will range from $53,000-$70,000 and are based on average median salary per job title. Additionally, it will cost roughly $5,500 for benefits, which include life insurance, health care, disability insurance, dental plans. Also, retirement plans, and 401k savings plans will be implemented. Part time employees will be paid minimum wage, which will cost $9 an hour. Although this isn’t significant pay, interactive and more fun businesses will typically pay part time employees at low cost. For example, Disney College Program Interns only get $8.87 an hour(Glassdoor.com). This will be a great experience for college kids to put on resumes and grow in the business and entertainment field. Dr.3D Labs is looking for college kids from local schools, such as NYU, Pace, Hunter College, City College, Baruch University, and other local top of the line NYC institutions. To get both full time and part time employees there will be job listings in the newspaper ads, Craiglist.com, Internship.com, Simplyhired.com, Mogul.com, and Recruiter.com. Additionally, it will be advertised via social media, and Dr.3D Labs will attend three career fairs. The cost of attending the career fairs will be $9000 (Wyborny, 2014).

sati


Dr. 3D Labs’ Competitors:As 3D printing is a newer technology, it is difficult to pinpoint clear competitors. No other company demonstrates the same concept as Dr. 3D Labs. Although there are many companies, discussed later, that do create custom 3D-prined dolls, they are not exactly like Dr. 3D Labs. This concept combines the production of toys with an engaging and entertaining experience. That being said, some business do exist in both 3D printing and children’s retailing industries that rival Dr. 3D Labs.

In terms of providing an engaging customer experience, Build-a-Bear is a successful example. They generated over $390 million in 2014, with 98% of stores making profit. This is a 12% increase from the previous two years, and is valued at $10 million (Build a Bear Annual Report, 2015). Build-a-Bear’s primary target market is kids ages 6-12. The main reasons customers visit are:• For a traditional visit (42%)• For birthday parties (33%)• To purchase gifts (25%)Similar to Dr. 3D Labs’ concept, customers get to go through all the steps of production as well as showcase creativity in the toy they create. The atmosphere of the store emphasizes the experience as a whole, making the child’s toy ‘come to life’. Although this isn’t direct competition because they do not use 3D printing technology, it is a consumer-focused experience like Dr. 3D Labs.

In regards 3D printing Dr. 3D Labs, there are many online retailors offering similar services. These include YouKickAss, ThatsMyFace, MyFaceonAFigure, 3D Plus Me and DOOB3D. With the exception of DOOB3D, to be discussed later, these business operate very differently than Dr. 3D Labs. They are all exclusively online retailors and target the demographic of 30-45 year-olds.

YouKickAss is the closest competitor when considering the product alone. This business was actually presented on Shark Tank and bought by Mr. Wonderful for $100,0000 for 10% of the business, valuing it at $1 million. They are an online 3D

printing business, where the consumer is made into superhero figure. Similar to Dr. 3D Labs, they only use the 3D printer for producing the head (Shark Tank, 2015). Their figures cost $15 to manufacture and are sold for $60. Although their costs reflect those of Dr. 3D Labs, this business is solely online. They also focus more on the software behind their figures. They patented their specially designed software, which was the primary point of interest for the shark tank investors (Shark Tank, 2015).

3D Plus Me is a kiosk service at different Target locations. It allows consumers to take a picture of their that is then printed onto a 3D figure (3dplusme). They are have four locations throughout California, and made an appearance at this year’s Super Bowl and World Series. Where 3DPlusMe excels is their licensing. They have partnerships with Marvel, the MLB, NFL, MLS, Star Wars, Hasbro, Harry Potter, and other well know brands (3dplusme). Their figures are premade, however, with the face simply printed onto it. This differs from Dr. 3D Labs creation of the entire head.

The most similar competitor is DOOB3D. It is a German 3D printing store with worldwide locations, but is now headquartered in New York (DOOB3D). They create high quality 4-14 inch figures, ranging from $95-$700. Rather then just creating printing heads as Dr. 3D Labs does, they actually scan and print a customer’s whole body. They have an physical locations where the scans take place, but where the figures are not printed. They files are sent to their German locations and ship back to the customer in 2-4 weeks. Their locations are doing very well, although the exact profit was not disclosed (Patrick, personal communication). Although DOOB3D is close to the Dr. 3D Labs concept, it is not exact. Dr. 3D Labs focuses more on the consumer experience than the product.

Although there are many competitors in children’s retail and 3D Printing, there is no business quite like Dr. 3D Labs. It combines children’s desire to create with high-tech technology. This concept has advantages over competitors through the use of a physical location and different demographic.

Competitor Analysis 15

Comparison with DOOB3D:As mentioned earlier, DOOB3D is a 3D printing business that is comparable to Dr. 3D labs. They are located within SOHO, New York and offer high quality custom figurines. Although DOOB3D does differ in the type of experience they offer, they are a good comparison when estimating demand. This is mainly because of their similar location and business model. Using their average sales of 25 figurines a day (Patrick, personal communication), the expected demand for Dr. 3D Labs is found using the method detailed in the following section.

Comparison Process:Although DOOB3D is a comparable business, it is not sufficient to simply use their 25 daily customers as the expected demand. Seen in Figure 9, SOHO does not have as much potential as Times Square. In particular, the retail spending and walking traffic is much smaller. Because Dr. 3D Labs is targeting tourists, its expected demand will increase if located in a vacation destination. In order to estimate the daily customers, DOOB3D’s demand was adjusted using the formula below:

The results and process for this adjustment is broken down in Figure 10 below. The multiplier was

found using the same process for each adjustment except with average price. Because the price between DOOB3D and Dr. 3D Labs differs so greatly, as discussed earlier, it can be expected a lower price

Resulting Demand: ____

Demand Forecast #116

Comparison Soho Time Square

Retail Spending

$4.6 Billion $18 Billion

Tourism 9 Million 39 Million

Walking Traffic 19,000 300,000

Square Foot of Location

1,328 2,600

Cost Per Square Foot

$60 $193

Figure 9: Comparing SOHO with Times Square (_________)

Figure 10: Demand Forecast #1

Adjustment Type Multiplier Ratio

Resulting Multiplier

Resulting Daily Demand

Adjustment Weight

Annual Tourists 4.33 108 people 25%

Walking Traffic 15.79 395 people 15%

Retail Spending 3.91 97 people 35%

Average Price* 4.71 118 people 25%

Weighted Daily Demand 152 people 100%

(25 )∗(𝑇𝑖𝑚𝑒𝑠𝑆𝑞𝑢𝑎𝑟𝑒 𝑆𝑡𝑎𝑡𝑖𝑠𝑡𝑖𝑐

𝑆𝑂𝐻𝑂𝑆𝑡𝑎𝑡𝑖𝑠𝑡𝑖𝑐 )

(𝐵𝑎𝑠𝑒𝐷𝑎𝑖𝑙𝑦 𝐶𝑢𝑠𝑡𝑜𝑚𝑒𝑟𝑠 )∗(𝐴𝑑𝑗𝑢𝑠𝑡𝑚𝑒𝑛𝑡𝑀𝑢𝑙𝑡𝑖𝑝𝑙𝑖𝑒𝑟 )

-or-

Comparison with Customization Businesses:As mentioned earlier, Doob3D is a 3D printing

Method of Comparison:

*out of 5

Since Soho and Times Square are considerably

Business Type/Name

LocationSimilarity

Product Similarity

Price Similarity

Amount of Average Daily Customers

Adjustment Weight

Me3D 4 5 2 50 People 45%

Caricature 5 2 2 100 People 25%

That’s My Face

1 5 3 15 People 15%

Bobble Heads 1 3 4 32 People 15%

Weighted Daily Demand 56 People 100%

Demand Forecast #217

Figure 9: Comparing SOHO with Times Square

Figure 10: Demand Forecast #2

BusinessType/Name

Location Product Average Price

Me3D Mall of America

CustomFigure

$275

Caricature Times Square

Custom Drawing

$15

That’s my Face

Online Custom Figure

$103

Bobble Heads Online Custom Bobble Head

$99

Dr. 3D Labs Times Square

Custom Figure

$71

Figure 9: Comparing Tourist Companies (_________)

Friends will be placed in Time Square. A comparison

Friends will be placed in Time Square. A comparison of DOOB3D and Dr. 3D Labs’ location is shown in figure 9. The largest different is the tourism. Time Square is the number two tourist spot in the world, where Lower Manhattan does not even make the top 10. Because of its New York location and similar business concept, DOOB3D is perfect to use to estimate demand.




Forecasted Demand18

Business Type/Name Amount of Average Daily Customers

Adjustment Weight

Demand Forecast #1-DOOB3D 152 People 85%

Demand Forecast #2- Tourist Attractions

56 People 15%

Weighted Daily Demand 138 People 100%

65%

20%

15%

Percent of Purchases

$65

$75

$80

Key Takeaway: Based on DOOB3D’s sales, Dr. 3D Labs estimates the majority of purchases will be of the least expensive option. Although, a significant amount of consumers will still purchases the more deluxe products.

Amusement park and attractions industry statistics. (n.d.). Retrieved March 14, 2016, from http://www.iaapa.org/resources/by-park-type/amusement-parks-and-attractions/industry-statistics

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Pedestrian counts. (2016). Retrieved March 22, 2016, from http://www.timessquarenyc.org/do-business-here/market-facts/pedestrian-counts/index.aspx#.VvHnyBIrK9a Price Calculator for 3D Printing. (n.d.). Retrieved March 22, 2016, from http://3dpartprice.com/ Renzulli, M. (July 31, 2015). The top 10 places to visit in the USA. Retrieved March 22, 2016, from http://usatravel.about.com/od/Top-Destinations/ss/Top-10-USA-Destinations.htm#showall Ryan, T. (January 11, 2016). The real reason toys ‘R’ Us quit Times Square. Retrieved March 22, 2016, from http://www.forbes.com/sites/retailwire/2016/01/11/the-real-reasons-toys-r-us-quit-times-square/#75342ff30c7c Schwoch, B. (April 26, 2013). 3D printing. Retrieved March 20, 2016, from https://prezi.com/k0f0qm6ahdab/3d-printing/ Search Times Square. NY Retail Space. (n.d.). Retrieved March 22, 2016, from http://www.cityfeet.com/cont/ny/times-square-retail-space#pgNum=1&id=LN19217640&overlay=true Shaftoe, R. (n.d.). Industry analysis of toys. Retrieved March 21, 2016, from http://smallbusiness.chron.com/industry-analysis-toys-77091.html Shopping Malls price per square feet statistics - states compared - Statemaster. (n.d.). Retrieved March 22, 2016, from http://www.statemaster.com/graph/lif_sho_mal_pri_per_squ_fee-malls-price-per-square-feet Social impact. (n.d.). Retrieved March 20, 2016, from http://www.3d-printing-technologies.com/social-impact.html Soho commercial space. (n.d.). Retrieved March 22, 2016, from https://www.thesquarefoot.com/ny/new-york/soho Special reports & Demographics. (n.d.). Retrieved from March 22, 2016, from http://www.timessquarenyc.org/do-business-here/market-facts/economic-impact/index.aspx#2 Statista. (2016). Most visited tourist attractions worldwide 2014. Retrieved March 22, 2016, from http://www.statista.com/statistics/303351/most-visited-tourist-attractions-worldwide/

Strickon, J. (October 14, 2010). Technology, toys and innovation: The rise of the entertainment designer. Retrieved March 21, 2016, from http://www.globaltoynews.com/2010/10/technology-toys-and-innovation-the-rise-of-the-entertainment-designer.html

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ThatsMyFace. (n.d.). Custom action figures, dolls & masks from your photos. Retrieved March 22, 2016, from http://www.thatsmyface.com/ Time Square Alliance. (n.d.). Retrieved March 22, 2016, from http://www.timessquarenyc.org/index.aspxWatch Shark Tank Season 6 Episode 28: Week 27 - Video Dailymotion. (n.d.). Retrieved March 22, 2016, from http://www.dailymotion.com/video/x2okuub Welson, J. (July 12, 2013). Open source action figure with 70 points of articulation. Retrieved March 22, 2016, from http://www.thingiverse.com/thing:116571 Wesley, D. (n.d.). The business of American vacations. Retrieved March 14, 2016, from http://visualeconomics.creditloan.com/the-business-of-american-vacations/ What is 3D printing? (n.d.). Retrieved March 22, 2016, from http://3dprinting.com/what-is-3d-printing/ Zaleski, A. (December 30, 2015). Here’s why 2016 could be 3D printing’s breakout year. Retrieved March 22, 2016, from http://fortune.com/2015/12/30/2016-consumer-3d-printing/ 3DPlusMe. (n.d.). Retrieved March 22, 2016, from http://www.3dplus.me/ 3D printing global effects: The free beginner’s guide. (n.d.). Retrieved March 20, 2016, from http://3dprintingindustry.com/3d-printing-basics-free-beginners-guide/global-effects-manufacturing-economy/ 3D printing regulation: Should governments intervene? (June 19, 2014). Retrieved March 20, 2016, from http://inlinepolicy.com/2014/3d-printing-regulation-to-intervene-or-not-to-intervene/ 3D printing regulation: Should governments intervene? (June 19, 2014). Retrieved March 20, 2016, from http://inlinepolicy.com/2014/3d-printing-regulation-to-intervene-or-not-to-intervene/ 3D printing technology: The free beginner’s guide. (n.d.). Retrieved March 20, 2016, from http://3dprintingindustry.com/3d-printing-basics-free-beginners-guide/technology/

References14

Appendix A: Porter’s Analysis of 3D Printing 15

Threat of New Entry

• High• Anyone can

purchase a 3D printer

• Preexisting larger companies shifting to 3D manufacturing

• Cost-effective manufacturing is appealing

Buyer Power

• High• People can

manufacturer designs themselves

• Can be harder to protect copyrights and patents

• Bargaining power

Threat of Substituti

on• Low• Not many

substitutes for 3D printing

• Has potential to become the most normal form of manufacturing

Supplier Power

• Medium• 3D printers

can be cost effective

• Many companies create their own 3D printer and software

Low amount of major competitors, large amount of smaller competitors

Specialized businesses Complex manufacturers

can require experts in 3D printing

Competitive Rivalry

Appendix B: PESTLE Analysis of 3D Printing 16

Political: 3D printing has an impact on government regulations and all areas of laws. Intellectual property (IP) law is the most common interception. 3D printing also changes the IP law, product safety and product liability law. (Intellectual Property Watch, 2015)3D technology creates astounding benefits for nation-building by growth on economies. (Margariñá, 2014) How to regulate / tax (IP); Is the IP provided as a service? Or, are you licensing software? Selling raw materials without charging for the blueprint? Signing customers to subscriptions for IP that they can upgrade and change? Taxation, whether in the form of direct income tax or indirect VAT/GST, hinges on such questions. (Flynn, 2015)

Economic: Families can save a great deal of money by making things with a 3D. Study shows that customers cost $312 to $1944 to buy 20 specific items compared to $18 to make them in a weekend. (Goodrich, 2013)Long-tail effect: our culture and economy is increasingly shifting away from a focus on a relatively small number of "hits" (mainstream products and markets) at the head of the demand curve and toward a huge number of niches in the tail. (Schwoch, 2013)

Social: 3D printing can influence many social based industries such as fashion, automobile and aircraft industries and even in weapon manufacturing. (3D printing Technologies, n.d.)3D printing also impacts the Health Care System. For example, print prosthetic limbs. There was a successful transplant of a 3D printed bladder in a patient 11 years ago. (3D printing Technologies, n.d.) 3D printing brings production closer to the end users and customers, so reducing the current supply chain restrictions and costs. (3DPrtingingIndustry, n.d.)

Technology: 3D digital model is the starting point for any 3D printing process, which can be created by 3D CAD programs. And consumers even have a simpler option, they can just scan objects with 3D scanner, then 3D printer would start to work. (3D printing industry, n.d.)With the development of the 3D printing technology, more and more different materials can be used to print in 3D printer such as Nylon. (3D printing industry, n.d.)There are different 3D printing technologies due to different materials. For example, some 3D printers process powdered materials such as Nylon, metal and plastics by utilizing a laser or heat source. And some other process polymer resin materials. (3D printing industry, n.d.)3D printing can possibly produce very detailed and complex objects. (3D printing industry, n.d.)

Legal: Users could make the unauthorized copying of objects easier. Companies will copyright: copy a protected work without a license (most artistic copyright) or patent: copying an innovate invention without licenses and then made it available online platforms. (Dubuisson, 2014) Companies cam also trademark copying a famous trade marks to use it in private business. (Dubuisson, 2014)

Environment: Reduces waste, especially when using metal. Reduces transport cost and emission compares with conventional fabrication. (Kovac, 2013)Uses a lot of electricity. Large 3D printers using heat or a laser to melt plastic consumed 50-100 times electrical energy than conventionalHowever, home 3D printers have power draw approximately equivalent to a laptop computer. (Kovac, 2013) The most commonly used material, apart from metal, is plastic, in particular, acrylonitrile butadiene styrene (ABS) and polylactic acid (PLA). ABS is petroleum-based polymer, so it is less environmentally friendly, whereas PLA is a biodegradable corn-based plastic. (Kovac, 2013)

Conclusion: This PESTLE analysis lead to the conclusion that in order for a 3D business to be successful, there needs to be a lot attention put in to technology and legality. Technology is rapidly changing in this industry, and business owners need to be aware of how their competitors may be able to gain a completive advantage if their technology improves. It also is important to keep patents and copy writes in mind when thinking about the design of printed items. The social aspect is positive, people enjoy 3D printing and notice it, as well as the environmental aspect because there is not a huge carbon footprint associated with printing.

Appendix B: PESTLE Analysis of 3D Printing 16

Appendix C: Porter’s Analysis of Children’s Retail17

Threat of New Entry

• Medium• Can be

difficult to purchase enough suppliers to start a new store

• Difficult to compete with mass retailers

• Anyone with access to toys can sell, thoughBuyer

Power• Medium• Many

different distribution channels of toys

• Customers have options for retailor, can choose a different one if unhappy with the current

• Customer must pay retailer's price, though

Threat of Substituti

on• High• Toys are

only one form of entertainment, there are many options for kids

• Advances in technology continue to increase entertainment options

Supplier Power

• Low • Easy to

purchase toys because of wide variety of manufactures

• Retailers can potentially create their own toys

• Materials to create toys are readily available

High A few major companies

have a great amount of market share

They have advantages over smaller companies such as buying in bulk and rand loyalty

Competitive Rivalry

Political: Political factors can influence the industry’s performance, including imposition of trade sanctions on imports. (Essay Giants, 2014) When retailing, following trade regualtions is important to avoid having to pay penalty taxes or do deal with

Economic: Domestic retail toy market is highly competitive. The retail markets’ biggest competitor is online shopping. Sales from online stores from manufacturers or websites like amazon can lower profits for toy retailers. (Shaftoe, 2014) Action figures sales have increased every year since 2013. Future growth is expected to be stable for retail market. (Shaftoe, 2014)

Social: More and more children aged 8-18 spend 7.5 hours per day on the internet and on social media site. This can mean that children are spending less time playing with toys. (Meland, 2010)

Technology: Toy retail market must innovate to survive. Toy companies release their newest products every year. However, this leaves little time to adjust to new technology. (Strickon, 2010)The declining cost of electronic components enabled more technology to be embedded in toys. It gives more space to innovate. (Strickon, 2010)

Legal: Toy manufacturers will need to make sure they protect their copyrights and patents. (Toy Industry Association Inc., n.d.)There are some federal-level and state-level policies that have impacts on toy retail market. For example, The Consumer Product Safety Improvement Act (CPSIA) enhances consumer product safety standards for children. And Toxic Substances and control act (TSCA) governs the manufacturing of chemicals and controls some unpredictable risks. (Toy Industry Association, Inc., n.d.)

Environment: Hasbro also vowed to reduce materials. They derive at least 75 percent of paper from recycled materials. (DesMarais, 2013)Lego has been working for years to eliminate PVC from toys. And they started to use smaller packaging boxes and they build a wind farm in Germany in order to utilize wind power. (DesMarais, 2013)Mattel has started to use recycled materials to produce and package. And company has also reduced energy consumption, CO2 consumption and water consumption to help the environment. (DesMarais, 2013)

Conclusion: Toy Retail: Dr. 3D’s Lab will have to pay attention to close competitors in the toy retail market. There will be low buyer and supplier power because we are purchasing a low cost manufactured part and we are not selling to a supplier, making operations easier. However, because 3D technology is getting less expensive and more in demand, threat of new entry and competitors may increase over time for our specific business.

Appendix D: PESTLE Analysis of Children’s Retail18

3D Printing Technology: The process of 3D printing begins with a design either created through Computer Aided Design [CAD] or through the use of a 3D scanner (What is 3D printing, 2016). This scanner makes a digital copy of preexisting object through laser imaging. Before the manufacturing process can begin, the file must be prepped for printing. Special software first ‘slices’ the 3D rendering into thousands of horizontal layers. The data in each layer is then transmitted to the printer. The printer reads the information in each layer and translates it into a part of the 3D object (What is 3D printing, 2016).

There are two simplified manufacturing processes behind 3D printing, additive and subtractive. An additive process is when the object is created through the gradual addition of material layers. In contrast, the subtractive method cuts away a solid block of material to create 3D objects (What is 3D printing, 2016). There are multiple methods 3D printers work with the supplied material, either melting or softening it. Just like there are different methods, there are also some different technology that 3D printers use. Fused Deposition Modeling [FDM] and Selective Laser Sintering [SLS] are two of these methods (How does 3D printing work, n.d). These are the most widely used technologies in 3D printers. FDM uses heated material as “molten ink” (What is 3D printing 2016) to create the object.

The ‘ink’ quickly cools and solidifies after being extruded from the nozzle. This process is continued adding layer by thin layer until the object is complete (How does 3D printing work, n.d). SLS uses UV lasers to create objects. These lasers are shown onto a pool of chemicals, turning the liquid solid as it moves across the pool. The laser is used to etch each layer into the pool until the design is complete (How does 3D printing work, n.d.).

In simpler terms, all methods of 3D printing use the same basic principles. A 3D object is transformed into a series of 2D layers. Through different methods, these layers are created and added together. Because of how small the layers are, some only .25mm high (How 3D printing works 2016), the process can take hours to complete. Although each method of 3D printing is somewhat different, the general idea is the same.

CubePro C Technology: Dr. 3D Labs plans to use The CubePro C printer in production of its action figures. The primary reason for this choice is how this model is one of the first full-color 3D printers. Using a full-color printer will save Dr. 3D Labs money. The company will not have to hire employees to paint the dolls after they are printed. The CubePro C printer will cost $2300

Appendix E: How 3D Printing Works19

Figure 12: Diagram of a 3D Printer Nozzle (How 3D printing works, 2016)

Figure 11: Example of a 3D Printer (How 3D printing works, 2016)

(BotObjectscom, n.d.). Resarch indicates it is a reasonable price, especially for smaller businesses. It is also expected to be worth the wages of unneeded employees. A traditional 3D printer can only print one color at once, while CubePro C can print multiple. Instead of hiring workers to paint the action figures after being printed, Dr. 3D Labs will be able to print in full color.

The CubePro C uses an FFF system to print objects (BoObjects, n.d). This system is a variation of the FDM process, where plastic inserts are loaded into the machine. Where it differs, however, is how it achieves full-color printing. The cartridge inserts are similar in design to traditional printers. The basic colors of cyan, magenta and yellow are mixed to create any color. The only difference with CubePro C is the material is a PLA plastic opposed to ink. Based on the computer readings, a code is created and sent to the printer. The colors are mixed inside the specially designed model before being extruded into the design. An example of a full-color design printed through CubePro C is seen in Figure 13.

Appendix E: How 3D Printing Works20

Figure 13: Full-Color 3D Printing (BotObjects, n.d.)

Figure 14: The CubePro C Printer (BotObjects, n.d.)

Appendix F: Graphic Design 21

Strengths•Unique concept •Perfect location for foot traffic•Low production costs

Weaknesses•Not ideal for repeat customers•Long printing time•Employees require training to properly operate printers

Opportunities •Part of rapidly growing industry•Consumers interested in STEM products

Threats •Highly competitive industry•Technology changes often and becomes obsolete •Only one source for CubePro C printer cartridges

Appendix G: SWOT Analysis 22

3D Printed Heads:Estimating the expected cost to 3D print customized doll heads was the most difficult to complete. First, a generic action figure head model was downloaded from Thingiverse.com. This file was inputted into one of two 3D printing calculators, either a program from thingiverse.com or 3dpartprice.com. Variables such as printer speed, filament diameter, filament mass and cost-per-hour were also included. These values were filled in according to the specifications of the CubePro C printer. The specific 3D printer cartridges Dr. 3D Labs plans to use during production do not explicitly state the mass of each filament, but rather the length. Using the given length of 45 meters and the type of plastic, PLA, the mass was estimated using comparable products. Finally, the calculated costs from the different calculators and assumptions were then averaged.

Doll Bodies:To find an average cost of a doll body, research was done concerning different doll wholesalers. In particular through the websites Alibaba.com and Aliexpress.com, two of the largest toy wholesalers in the world. Multiple designs similar to the desired look of Dr. 3D Labs were found. Although Dr. 3D Labs plans to create custom doll designs, for the purpose of planning pre-existing dolls were used. The selected dolls can be seen below. Finally, the costs for each of these bodies were averaged.

Doll Hair:Finding the average cost of the doll hair followed a similar process to the bodies. Dr. 3D Labs plans on using synthetic hair in their action figures in order to cut costs. As seen on Allibaba.com and Aliexpress.com, synthetic hair is substantially less expansive than authentic hair. Different colors and lengths of hair was found, and their prices averaged together.

Clothing and Accessories:A similar procedure as with doll hair and bodies was used to estimate the cost of clothing and accessories. As with the bodies, Dr. 3D Labs plans on designing its own custom doll clothing. Therefore, the examples shown below were only used as a means of benchmarking. Different styles of clothes for both male and female dolls were taking into consideration for the average.

Appendix H: Cost Estimation Process23

Appendix I: Store Mock-Up22

Appendix I: Store Mock-Up Cont’d22




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