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>> Pati: Meeting online also gave us more flexibility without having to worry about traffic or coordinating time or places to meet.
>> Just check our Path to innovation.
First, we brainstorm ideas. Any and every idea we can think of is on the table.
Then we filter through these ideas, removing any unoriginal ones.
We rate the ideas - deciding the ones we think are the most original or have the best chance of success.
Then we research our best choices, ultimately narrowing the list down from 100 or more to just a few ideas worth pursuing.
>> Melissa: Collectively, the quality of our ideas as a group were far than any single idea any of us could have come up with alone.
>> Pati: Then we had to take our gigantic list of ideas and collapse them into 20, and then expand them again into 50.
>> Sandra: Sometimes we spent 3 or more hours researching our ideas for originality, filtering them, or just chatting and making each other laugh.
>> For our final idea, we decided on software that allows retailers to automatically send electronic copies of receipts to a repository that customers can access online.
>> Sandra: This final idea survived round after round of intense scrutiny.
Thinking and being imaginative wasn't the hard part; the hardest of all was being original.
But we did it, and we're starting a Receipt Revolution!
>> Melissa: Our goal is to make receipts 100% paperless!
Great for the environment, creates cost-savings for retailers, and gives customers and online repository so their receipts are never lost.
>> Chuck: Once we fully developed our business idea, it was time to discuss feasibility, cost, personel, and competition.
The most important challenge to feasibility is coming up with a concept that has a real need in the marketplace.
With our business, we've come up with an idea that, if implemented, can help businesses of all sizes save money and create less waste.
Our business also has limited startup costs, creating the potential for rapid return on investment.
This chart summarizes the cost the company would incur during its first year of operations.
We estimate that the sum of all the startup costs and operational expenses during the first year would total approximately $376,000.
The major costs at the time of setting up the company would be a $40,000 investment in product development, including the development of a website and software needed, among other things.
Throughout the year, the major operating expenses are $128,000 in payroll for 3 dedicated resources, $50,000 in advertising activities, and $50,000 spent as direct cost of sales.
>> Pati: So, here we see a breakdown of profits based on average cost per customer and estimated sales.
So the cost of the service will be $3,000 its first year, $7,000 the second year, and $25,000 the third year, which is based on an average of price ranges from $1,000 to $100,000.
Since the total cost to a retailer will vary, depending on the total number of software licenses purchased.
So, if Receipt Revolution aquires 175 customers its second year and 200 customers in its third year, then an estimated revenue would be about $1.2 million and $5 million, respectively.
The total estimated profit for the second year is of $1 million and $3.2 million in the third year, making this a very lucrative business in a very short amount of time.
>> Tim: The closest business model that exists today is shoeboxed.com.
This company allows customers to send in their receipts via pre-paid envelopes, email, or from mobile phone and then stores them remotely.
Although this company shares the same concept of an online repository for receipts, it still requires its customers to manually submit the receipts so they can be stored.
[Music: electronica tango]