298 San Antonio Road

Mountain View, CA 94040

(831)277-7389
info@smartlocksolutions.com

p. (831)277-7389

Business Plan
April 28th 2015

BUSINESS PLAN

info@smartlocksolutions.com
www.smartlocksolutions.com

BUSINESS PLAN

Table of Contents
I.

Executive Summary..........................................................2

II.

Business Concept Proposal...............................................3

Opportunity/Problem
Solution
Value Proposition

III.

Marketing & Industry Analysis..........................................4

Target Market
Market Size and Trends
Competition
Competitive Advantage

IV.

Business Model & Go-to-Market Strategy..........................6

Expected Source of Revenue
Business Model Canvas
Key Partners

V.

Current Status/Stage of Venture.....................................11

Milestones/ Timeline

VI.

Appendix.......................................................................13
Determining Start-Up Capital
Cash Flows
Break-Even Analysis
References
Powerpoint Slides

BUSINESS PLAN

Executive Summary

Issue Date: April

company Information

Info
k Inc.
etails
2015
loyees: 4

2015

Company Overview
SmartLock is a company that designs and develops
biometric locking systems for improved
convenience and security.

History
ed to date
$10,000

Problem

unds
Development, Hiring CFO, Small Sales Production, Business Place
Lease
Finding
your keys can be a hassle, especially when
Product

Hyeong Louis Kim

epreneurship, Business Administration

Account Manager:
Perrin Yeung
agement, Business Administration

ject Manager, and Lead Product Design: Jackson Duong

epreneurship, Business Administration

Head of Sales:
Onkar Grewal
epreneurship, Business Administration

SmartLock will offer a keyless entry system,

complete with a biometric scan of fingerprints, to
allow for easier accessibility into homes. The
product is simple to install and comes with a
warranty package. By replacing traditional keys,
SmartLock will secure your home in a more safe and
convenient way. We also plan to include a facial
recognition feature in future products.

Competition/Competitive Advantage
There are a few companies similar to SmartLock
and its design.
August Smart Lock: offers users smartphone
capabilities of connecting to Wi-Fi and controlling
the lock through the phone.
Goji Smart Lock: similar to August Smart Lock,
Goji uses an application platform to connect users
to their lock with a password protected system.
BUSINESS PLAN

Business Concept Proposal

Opportunity/Problem
A total of 3,680 hours or 153 days is spent searching for lost items over our
lifetimes. Losing your keys is one of them. People lose their keys on a daily basis
and spend countless amounts of time waiting for locksmiths or family members for
another set. Losing your keys can also pose as security risks and even lead to
break-ins into your home. Homeowners should be extra careful when it looking
after their house keys as they may succumb to opportunistic thieves. As
technologies are becoming more advanced, many people are becoming increasingly
interested in securing the keys to their homes.
Asian countries such as South Korea, Malaysia, and Japan have already adopted the
keyless entry system and is used widely across the many other countries.
Electromechanical and electronic locks are widely popular in the South Korean
markets and there is growing demand in North America.

Solution
SmartLock is a keyless entry system that uses only your fingerprint to unlock your
door, removing the need for carrying an extra key. The SmartLock is a selfinstallation keyless entry system that comes in one package -- like a normal lockset
would. Installation is done by removing the exterior cylinder latch and attaching the
SmartLock onto the deadbolt. Users can still manually lock and unlock the door from
the inside. After installing the SmartLock, users can then set which fingerprints they
want to use as their own personalized key. The installment allows for a simpler
accessibility and an alternative locking mechanism for homeowners.
Design
SmartLock is featured with a sleek and smooth design visually appealing to any
modern day homeowner. The SmartLock has a cylindrical dimension of 4 inches in
diameter and a height of 2 inches. With a built-in LED lighting on the main surface
and a smooth stainless steel surface for the biometric scanner, SmartLock is
powered by 4 AA batteries which will provide a light signal when battery life is low.
Homeowners can now look forward to unlocking their doors.
Our product will include two models: fingerprint scanning and facial recognition

Fingerprint Scanning will be featured in our first product that will include
biometric recognition using fingerprints.
Facial Recognition will be implanted into our second line of products in
conjunction with our fingerprint scan to deliver the maximum amount of
security. We are in development of producing a product with the added
feature of facial scanning to improve the security of keyless door entry.

Warranty
A one-year warranty of our product will be available to our customers which will
provide home repairs and replacements if necessary for $30.00. SmartLock will also
provide a 24/7 customer support center for any installation needs and questions as
well as installation guides.
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Value Proposition
Our value proposition is based on the convenience of using our product, the
performance of the product, and our customer performance. Our product comes in
an installation package, which is easy to install, has a warranty, and a 24/7
customer support line for questions and concerns. It eliminates the use of keys,
which can save time from looking for your keys and hundreds of dollars from not
having to call a locksmith. We value ourselves in our support and customer help.

Marketing & Industry Analysis

Target Market
Through our surveys and interviews, we accumulated around 200 responses from
potential customers who were home owners. We determined that the SmartLock
target market would be single family and multifamily home owners in their midthirties to late forties. We determined that younger home owners were more willing
and open to new technology as opposed to home owners over the age of fifity. We
also found that homeowners ages 30-40 were more willing to buy our product than
homeowners in the age range of 20-29.

Our market survey has found that are target customers are more likely to pay a
10% premium over standard lock sets for the value of not having to worry about
losing their keys and added security for their home, indicating that SmartLock does
create value for its customers. The difficulty or pain of the consumer is
measured primarily in the time and inconvenience of losing their keys and having to
spend time and money to find and or have a locksmith come to their home and let
them back in. Also, homeowners prefer not to spend extra money to have extra
keys made for family members and the amount spent on replacing those keys every
time they are lost or stolen. By finding customers that are fed up with losing keys
and having to spend extra money on locksmiths and copying keys for family
members, SmartLock is removing the pain involved and adding convenience and
added security to the customers home and day-to-day activities.

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Homeowners Willingness to Use

Age 50+; 6%

Age 20-29

Age30-39
Age 40-49
Age 40-49; 17%
Age 20-29; 43%

Age 50+

Age30-39; 34%

Market Size and Trends

Based on the research from NextMarket Insights the residential smart lock market is
expected to grow significantly in the coming years, going from a $261 million
market worldwide in 2013 to over $3.6 billion in 2019.

NextMarket forecasts the total US DIY smart home market will grow from $1.28
billion in the US in 2014 to nearly $7.8 billion by 2019. One of the biggest categories
of DIY smart home devices will be locks, which will see the US market go from $66
million in 2014 to nearly $1 billion by 2019. The market for self-installed solutions
will grow very rapidly over the forecast period and will account for over one-third of
smart security users by 2020. We believe the most important customers are going
to be homeowners because the majority of homeowners have more than one person
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living in the house which means everyone needs a set of keys to enter the home.
Homeowners are the most likely to make an investment in SmartLock, which saves
time, money, and makes it convenient for everyone living in the household.

Competition

Competitive Landscape
The SmartLock industry is fragmented, with many small competitors. Competitors
include August Smart Lock, Okidokeys Smart Lock, and Goji Smart Locks. Brick and
mortar competitors include the larger retailers such as The Home Depot, Lowes, and
other home improvement stores. Another potential threat would be larger
established companies who are looking to expand their business into Smart Devices
such as Apple, Google, and Samsung. With not that many competitors in the
industry the barrier of entry is very low; thus gaining market share will be very vital
to the success of our company.

Competitive Matrix

SmartLo
ck

August
Smartlock

Samsung Ezon
Shs-p810

Goji

Convenience

Design

Customer
Service

$179.99

$ 249.99

$199.99

$299.99

Price

Competitive Advantage
Advantage over August Smart Lock
Our advantage over August Smart Lock is our around the clock customer service
and support which is available 24/7. Also our price is significantly lower than August
Smart Lock. August Smart Lock uses a mobile advice as a key feature for their lock,
BUSINESS PLAN

which can also be an inconvenience if your phone is dead or lost. Our product
differentiates from this because our product uses fingerprint technology.
Advantage over Samsung Ezon Shs-p810
Our advantage over Samsung Ezon Shs-p810 is our price, design, and customer
service. Samsung charges a premium for their products because they are a brand
name. Our product has a better design and function. Our customer service is more
personal and around the clock unlike Samsung which is your normal working
business hours.
Advantage over Goji Smart Lock
Our advantage over Goji Smart Lock is the convenience, design, customer service,
and price. Goji also charges a premium for their product but lacks in the design and
look of the product. Also Gojis has very bad reviews for customer service from the
various websites they sell their product on such as Amazon. The price of the Goji
product is also higher than all of our competitors .

Business Model & Go-to-Market Strategy

Expected Source of Revenue
As a sales and manufacturing company we expect the majority of our revenue to
come from sales of the product and warranty sales. We will concentrate on
generating revenue through the sales of our product in online retail and up selling
warranty plans.

Business Model Canvas

Key Partners
Commercial partners:

Metals Depot
Planet
Biometrics
TechShop
Fedex
Legalzoom

Key Activities
Platform of
Security
awareness
Marketing
Production and
supply
Distribution

Key Resources

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Design and
production
center

Value Propositions

Quick & efficient

to use
Technological
product: offering
IT services
Security/Awarene
ss

Customer
Relationships

Direct Personal
assistance:
communication
with customer at
point of sale, call
centers, email
Customer Service
Close interactions
Online
communities:
forums/blogs/webi
nars

Channels

Distribution
through online
retail

Online Platform
Manufacturing

facility
Cost Structure

Web Hosting
Costs
Marketing and
Sales
Product
Development
Commercial
partnership
Licensing costs

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Revenue Streams

Warranty
Retail sales
Gross Margin

Commercial
distribution
Shipping

Key Partners
TechShop
www.techshop.ws
TechShop offers many different services from personal training, consulting, to
prototype of product development. For only $95.00 dollars an hour limit to 2 hours,
TechShop will offer admission into their facility and develop your entrepreneurial
product. Personal training offers the ability to have sessions with a one on one
instructor to attain the knowledge of the service provided (Safety and Basic use); 3
additional participants may join for $30.00 an hour each. Personal consulting is also
offered to support individuals with new ideas of a product in development and well
as advice on the product/service. Personal prototyping is common in this facility and
provides customers with the ability to see their products come to life. Manufacturing
equipment is provided with state of the art machinery and skilled instructors.
Metals Depot
www.metalsdepot.com
Metals Depot is a retail division of Ledford Steel Company established in 1999 as a
small quantity metals supplier in the United States. Metals Depot is one of
Americas largest metal supply businesses. Providing over more than 25,000
different shapes, sizes and a quantities of other metals. They provide a wide
selection of metals and materials in small quantities with fast shipping. Their
company has grown worldwide and now ships products available to larger
audiences. Metals Depot can provide companies with the necessary raw materials
to develop their products. As a supplier in stainless steel and deadbolt bars, lock
makers and smiths are provided with the best materials in a convenient amount of
time.
Zvetco Biometrics
www.zvetcobiometrics.com
Zvetco Biometrics is a leading innovative technology that adapts human
characteristics to function an operating system. Based off the identification of the
user, Zvetco Biometrics offers us the ability to adapt its technology in developing a
fingerprint scan capability that will be able to connect with our product SmartLock.
Zvetco Biometrics is a manufacturer of identity authentication hardware provide the
engineering parts for developing a fingerprint technology hardware. They provide
responsive expert support, experienced developers, and programmers that offer
network security expertise.
Legalzoom
www.legalzoom.com
Legalzoom is an easy to use online service that offers quick legal documentation
and services to startup companies. They are a leading and nationally recognized
legal brand that helps with small businesses in the United States. Legalzoom
provides help with legal copyright services such as business formations, patents,
BUSINESS PLAN

trademark registration, and various other legal services. Providing us with the
necessary legal background, Legalzoom is a necessary partner that will help our
company grow.

Fedex
www.fedex.com
FedEx is a courier services that specializes in delivering products to multiple
destinations around the world. Fedex covers more than 220 countries and
territories and linking most of the worlds GDP. Through air, ground, and sea
networks, Fedex is able to deliver their services to almost any company, especially
newly created ones. Fedex express freight allows us to maximize our potential in
customer deliver and partner with a commercial distribution channel. Fedex has
networks operating co-dependently on each other and provides services for small
businesses all across the United States.

Business Development Strategies

Online Marketing
www.smartlocksolutions.com
We will buy a website domain, currently in development, and market our product
through that portal. After we develop our website we will begin establishing sales
from online retailing. By marketing through our website, we will host the latest
information on our product and the implement sales through an online store. There
will also be a forums discussions board along with a customer support center and
contact information available for all customers.

Trade Shows
South by SouthWest (SXSW)
Trade Shows like SXSW expos, held in Austin, Texas, are a great way to gain product
awareness and build relationships with customers and supporters. They are also a
great way to demonstrate our prototype and follow up on feedback from
participants before actually launching the product into the market

BUSINESS PLAN

Trade shows are uniquely intended for the future customers and possible venture
capitalists interested in our product. It will allow us to demonstrate our product
along with retaining the questions the consumer has to gather the feedback for us
to upgrade our product.

Kickstarter Campaign
A Kickstarter campaign will foster brand awareness and possible future capital
investments in our product. We will use a Kickstarter campaign to help us create
brand awareness for SmartLock and assess the needs of the consumers. As a
marketing strategy, this will also help us gain potential capital investments into our
product. Starting a Kickstarter campaign requires low cost initial costs and helps us
to improve our product from feedback.
The Team

Louis Kim
CEO

Perrin Yeung
CCO/ Account
Manager

Onkar Grewal
COO/Head of Sales

Jackson Duong
CMO/Project
Manager/Lead
Product Design

Founding members:
Kun Hyeong Louis Kim - CEO (Chief Executive Officer)
Duties and Responsibilities:
business development
Oversees the business and responsible of the overall companys sales
Leads Senior Management Team
Kun Hyeong grew up in the family of entrepreneurs. Family has always had
businesses and with the influences from my parents and experience of visiting many
different countries had lead me to be an entrepreneur. My experiences also include
participations in the kick start up expos around the Silicon Valley.
Perrin Yeung CCO - (Chief Communications Officer/Account Manager)
Duties and Responsibilities:
Negotiating partnerships and licensing agreements
Online Media and Internal Relations
Customer Relationships
Advisory Relationships
Perrin Yeung is extremely humble and motivated. He is currently studying at San Jose
State University for his Bachelors in Business Administration Concentration in
Management. His past 4 years working under the provisions of management
BUSINESS PLAN

directors has lead him to take control of the relationships of other firms and
businesses.
Onkar Grewal COO - (Chief Operations Officer/Head of Sales)
Duties and Responsibilities:
Research and Development
Client-Care officer
Sales administration
Onkar Grewal was introduced to entrepreneurship at a very early age, both my
father and brother ran a business which I was later involved in when I grew older.
Majoring in Business Administration with a concentration in Entrepreneurship and
want to use what I know from working with my family and what I'm learning now to
start my own business.
Jackson Duong CMO - (Chief Marketing Officer/Project Manager/ Lead Product
Design)
Duties and Responsibilities:
Online Marketing and Web Development
Product Design
Analytical tasks
Advertising and Promotions
Jackson Duong has spent the last 3 years developing websites, engaging in direct
sales, and customer service along with leading promotional projects at sports
authority. He is currently studying business with a concentration in
entrepreneurship. His enthusiasm and positive energy contributes towards his
marketing development strategies.

BUSINESS PLAN

Current Status/Stage of Venture

This 12-month timeline is our assumption to develop and launch the sales of our
product. We will be self-funding ourselves in the first year until we acquire the
necessary funds from venture capitalists or Kickstarters. Each member of the team
will contribute roughly $25,000 for the first year in funds. For the first year, we will
be making 1,500 units and sell them for $200 each.

Milestones/ Timeline
6/30/1
5

7/3
1

8/3
1

9/30/1
5

10/3
1

11/3
0

12/31/
15

1/3
1

2/2
9

Start Membership
with TechShop
Develop &
Manufacture first
500 SmartLocks
Develop online
sales channel
Develop Facial
Recognition
SmartLock
1st production run:
500 SmartLocks
sales
Increase Website
Functionality/Marke
ting
Lease office space
Develop Walk-In
Store Channels/
Support Centers
Hire CFO
2nd production run:
500 SmartLock
3rd production run:
500 Facial
Recognition
SmartLock

Major Milestones for the next 3,6,12 months

MileStones:

Time of
length

Starting
Date:

Completion
Date:

Start Membership with TechShop

1 week

6/30/15

7/1/15

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3/3
1

4/3
0

5/3
1

Develop & Manufacture first 500

SmartLocks

5 weeks

6/30/15

7/31/15

Develop online sales channel

27 weeks

8/31/15

2/29/16

Develop Facial Recognition SmartLock

22 weeks

11/30/15

4/30/16

1st production run: 500 SmartLocks

9 weeks

12/31/15

2/29/16

Increase Website
Functionality/Marketing

22 weeks

1/31/16

6/30/16

Lease office space

1 week

1/31/16

2/7/16

Develop Walk-In Store Channels/

Support Centers

8 weeks

1/31/16

3/31/16

Hire CFO

1 week

1/31/16

2/7/16

2nd production run: 500 SmartLock

8 weels

2/29/16

4/30/16

3rd production run: 500 Facial

Recognition SmartLock

4 weeks

5/31/16

6/30/16

BUSINESS PLAN

Appendix
Determining Start-Up Capital
12 month Funding needs
Cost

Raw Materials: stainless steel, deadbolt lock,

biometric circuits (costs $50 each lock)

$75,000

TechShop Membership

$5,580

Errors and Omissions Liability Cyber Networks

$2,000

Directors/Officers Liability
Design Patent
Incorporation LLC

$1,000
$900
$820

Marketing: Google adwords, adcliker

Fedex partnership

$516
$420

Legalzoom administration fees

$400

Hosting a website domain: godaddy.com

Trade shows: SXSW
TOTAL

$200
$200
$87,036

Cash Flows

Sales

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Jan

Feb

Mar

Apr

May

Jun

Jul

Sales For Product/Service #1

Sales For Product/Service #2
Total Sales
Cost of Sales
Purchases
Materials
Production Expnses

Total Cost of Sales

Gross Profit before Labour

Labour Costs
CEO: Louis K
CFO: Justin Y
Head of Sales: Onkar G
Account Manager: Perrin Y
Project Manager: Jackson D
Total Labour Cost
Gross Profit

Gross Profit
Expenses
Recruitment
Rent
Couriers
Insurances
Office cleaning
Repairs/maintenance
Postage
Printing & stationery
Advertising/marketing
Telephone/fax
Computer Costs
Motor & Travel
Entertainment
Legal & Prof. Fees
Financial services
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10,000
0
10,000

10,300
0
10,300

10,609
0
10,609

10,927
0
10,927

11,583
10,000
21,583

12,278
10,600
22,878

13,015
11,236
24,251

2,000
750
2,750

2,060
773
2,833

2,122
796
2,917

2,185
820
3,005

4,317
1,619
5,935

4,576
1,716
6,291

4,850
1,819
6,669

2,750
27.50%
7,250
72.50%

2,833
27.50%
7,468
72.50%

2,917
27.50%
7,692
72.50%

3,005
27.50%
7,922
72.50%

5,935
27.50%
15,648
72.50%

6,291
27.50%
16,586
72.50%

6,669
27.50%
17,582
72.50%

2,000
1,000
2,000
2,000
2,000
9,000
90.00%
(1,750)
-17.50%

2,000
1,000
2,000
2,000
2,000
9,000
87.38%
(1,533)
-14.88%

2,000
1,000
2,000
2,000
2,000
9,000
84.83%
(1,308)
-12.33%

2,000
1,000
2,000
2,000
2,000
9,000
82.36%
(1,078)
-9.86%

2,000
1,000
2,000
2,000
2,000
9,000
41.70%
6,648
30.80%

2,000
1,000
2,000
2,000
2,000
9,000
39.34%
7,586
33.16%

2,000
1,000
2,000
2,000
2,000
9,000
37.11%
8,582
35.39%

Jan
(1,750)

Feb
(1,533)

Mar
(1,308)

Apr
(1,078)

May
6,648

Jun
7,586

Jul
8,582

50
2,500
35
250
0
100
0
0
43
20
5,000
100
0
426
0

50
2,500
35
250
0
100
0
0
43
20
0
100
0
426
0

50
2,500
35
250
0
100
0
100
43
20
0
100
0
426
0

50
2,500
35
250
0
100
0
0
43
20
0
100
0
426
0

50
2,500
35
250
0
100
0
0
43
20
0
100
0
426
0

50
2,500
35
250
100
100
0
100
43
20
0
100
150
426
0

50
2,500
35
250
0
100
0
0
43
20
0
100
0
426
0

1
1
2

27
1
72

35

37

Audit fees
Bank charges
Credit Card Charges
Bad debt allow.
Canteen expenses
General expenses
Lease Interest
Depreciation
Light & heat
Staff Training
Subscriptions
Total Expenses
Net Profit/Loss

Accumilated Net Profit/Loss

Quarter Net Profit/Loss

BUSINESS PLAN

0
5,000
5,000
0
0
0
0
0
50
0
0
18,574
185.74%
(20,324)
203.24%

0
0
0
0
0
0
0
0
50
0
0
3,574
34.70%
(5,107)

0
0
0
0
0
0
0
0
50
0
0
3,674
34.63%
(4,982)

0
0
0
0
0
0
0
0
50
0
0
3,574
32.71%
(4,652)

0
0
0
0
0
0
0
0
50
0
0
3,574
16.56%
3,074

0
0
0
0
0
0
0
0
50
0
0
3,924
17.15%
3,662

0
0
0
0
0
0
0
0
50
0
0
3,574
14.74%
5,008

-49.58%

-46.96%

-42.57%

14.24%

16.01%

20.65%

23

(20,324)

(25,431)

(30,413)

(35,065)

(31,991)

(28,329)

(23,321)

(17

-30,413

2,084

13

Break-Even Analysis

Fixed Cost

$80,580

Variable cost

$6,456

Price/Product

200

Margin

-6256

Breakeven Point in Units

-12.8804

Breakeven Point in Dollar Sales

-2576.09

References
AdWords. (n.d.). Retrieved from https://www.google.com/adwords/costs/
Get Online | Business Email, Domain, and Web Builder Software. (n.d.). Retrieved
from https://www.godaddy.com/offers/online-business.aspx?ci=95658
LegalZoom | Start a Business, Protect Your Family: LLC Wills Trademark Incorporate
& More Online. (n.d.). Retrieved from https://www.legalzoom.com/
Lost something already today? Misplaced items cost us ten minutes a day. (2012,
March 20). Retrieved from http://www.dailymail.co.uk/news/article-2117987/Losttoday-Misplaced-items-cost-minutes-day.html
The Do-It-Yourself (DIY) Smart Home Market Set To Explode In Coming Years
According To NextMarket. (2014, July 24). Retrieved from
http://nextmarket.co/blogs/news-1/14925921-the-do-it-yourself-diy-smart-homemarket-set-to-explode-in-coming-years-according-to-nextmarket
Using fedex.com. (n.d.). Retrieved from
https://www.partnership.com/Services/using_fedex

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