Tobriand said:
Approximate business plan:
1) Buy components to make the machine: £x for z units
2) Rent a factory to put them together: £y for z units
3) Assume a comparable sales figure to (estimated) major body of GP2x sales (rationale being that those people turned off by the price will be compensated by new customers): ~30000
4) Sell at estimated figure of £160/unit (excluding VAT)
5) Approach investors, banks for initial investment assuming some is necessary for a figure of: £(x+y - personal financial commitment)
6) If 3) is correct (seems reasonable) overall gain is (30000 * (160-((x+y)/z))) - money paid back to bank (if applicable).
7) Gain for investors is their proportion of the initial capital of this end gain.
Obviously that's very very loose and very very obvious. It doesn't take into account the wholesale price, but apart from that, the principle seems reasonable. Crucial assumption is 3) which seems reasonable to me (although it might not to others).
In addition there would be marketing costs, but those only really apply to attracting the audience outside of this community (since it's free to stick a news item on the front page along with reviews of the system - releases of software essentially would act as viral marketing without any investment at all). Bear in mind that people like Craigix and Evildragon have already done the brunt of non-Korean marketing for the Western audience of the GP2x. They know how much that cost them, so they can make a reasonable inference to a similar figure for a future handheld.
Beyond that, which can of course be worked out with some commonsense, what should we expect to be told? I mean, come on, you don't ask about the business plan of any other venture unless you're actually planning on investing in it, do you? Do Sony/Nintendo/Microsoft disclose their perfectly itemised business plans? Does the company which owns Slashdot? Does Google? No, of course not! It's unfair to expect it.
I'm quite certain Craigix has one, because he's been in business for some time - assuming GBAx has been running since the early days of GBA cartridge writers, for at least 7 years, and possibly longer. QED he knows how business works. It just happens that this is a slightly different business to the pure retail one!
Well, to be exact my point was : I wondered why the community did not discuss more the business case behind craigix's project. Of course I don't expect craigix to disclose his business plan, it would be stupid of him to do such a thing (already said that). But, since people here keep discussing every little detail of this hypothetical (for the moment being) device, I just find strange that no one ever talks about
business, rather than just focus on technical implementation details :blink: But this is maybe just me, because I am quite interested by this kind of topic (business viability of such a project) especially considering project is in its early stage.
For example, I would find interesting to discuss Tobriand's business plan proposal :
- point 1 (buy components) seems easy, but do we have an idea of how much all components will cost ? It seems to me that the price of the chip (omap) was discussed, but what about the screen, the case, and so on ?
- point 2 (rent a factory) seems a high cost factor. Does anyone have any idea of how much it costs to rent a factory ?
- point 3 seems reasonable, meaning (at least at the beginning) quite a low sale factor (30000 potential buyers is not very high !)
- some other points to take into account for wholesale price :
+ delivery costs
+ delivery delays (may have a strong impact if one component is not available at the right time)
To conclude, none of this may be my business, but still I would find it interesting to have some infos even if it's just some guesses since, as you pointed out, craigix won't disclose his real business plan
[EDIT] And, if we had such a discussion, at the end it may help craigix and co to realize that this project is doomed to financial failure, thus making them cancel it
