1. TUTORIAL 3 TESTING THE COMMERCIALIZATION STRATEGY Part 1 - Steps to enter the sales and variable production costs.

2. USING THE SLIDE PRESENTATION  This slide presentation is fully interactive. Although it has been pre-programmed to advance automatically, you may override these times by using your mouse.  Pressing the right mouse button will pause the program and provide you with a menu which allows you to expand the view of the slides to Full Screen and move backwards or forward through the slides.  Alternatively you may click on the scroll bar on the right of the slide to move forwards or backwards through the slides.

3. What You Will Learn  After completing Part 1 you will be able to enter the sales and variable production costs for your new product.  After completing Part 2 you will be able to enter the fixed production costs, a capital budget, the research schedule, and indirect fixed costs.  After completing Part 3 you will be able to test the financial feasibility of the Commercialization Stage and enter the financing plan.

4. Steps to Test the New Product Strategy Step 1 Test the viability of your product concept Step 2. Develop and test your Pre-production strategy Step 3. Develop and test your Commercialization strategy

5. TABS IN THE NEW PRODUCT TEMPLATE Welcome - This tab links the New Product Template to the Online Course Menu - This tab provides a menu to help navigate through the New Product template as well as links to these tutorials. Concept - This worksheet will test the feasibility of your new product concept. Prototype - This worksheet will test the feasibility of your Pre- production strategy. Full Production - This worksheet will test the feasibility of your Commercialization strategy. Summary Statements - Provides a series of proforma financial statement summaries.

6. HOW TO SET UP THE COMMERCIALIZATION WORKSHEET Step 1 Enter the sales and variable production costs Step 2. Enter the fixed production costs Step 3. Enter the capital budget Step 4. Enter the research and I.P. costs Step 5. Enter the indirect costs Step 6. Check the Cash Flow and enter the financing sources Step 7. Enter the details of any new loans You may work directly in the Full Production worksheet or use the menu found in the Menu tab to help enter the data.

7. SALES AND VARIABLE PRODUCTION COSTS Follow the Numbered Orange Dots to Enter the Sales and Variable Cost Data In the Menu page click Sales and variable production costs. This will take you to the Full Production worksheet. 1 Click on YEAR 1 SALES in the Full Production Stage Navigation System 2

8. Enter the Sales Data for the Commercialization Stage Enter a descriptive name for your new product 3 Enter the number Units that will be sold in Year 1 and enter the Unit Price. You may enter data into any of the blue shaded areas. 4 Enter the number of units in inventory at the beginning of the year and the amount of inventory required at the end of the year. The template will calculate the amount of production required to meet your sales forecasts and inventory requirements. 5 Enter the commission rate. 6

9. Enter the Variable Labour Cost For Each Year of the Commercialization Stage Enter the labour activities used in the production process. You may enter data into any of the blue shaded areas. 1 Enter the number Input Units (hrs) that that are required for each activity. Enter the Unit Cost (cost per hour). You may enter data into any of the blue shaded areas. 2

10. Enter the Variable Material Cost For Each Year of the Commercialization Stage Enter the list of materials that are used in the production process. You may enter data into any of the blue shaded areas. 3 Enter the number Input Units for each of the materials that that are required to build one unit of finished product. Enter the Unit Cost. For each of the materials. 4

11. Enter the Variable Contract Work For Each Year of the Commercialization Stage Enter the activities used in the production process that will be contracted out. You may enter data into any of the blue shaded areas. 5 Enter the Unit Cost for each contracted activity. 6 To return to the Full Production Stage Navigation System press the keys on your computer. (Press the key while holding down the key. 7

12. End The Tutorial End The Tutorial What do you want to do next? Repeat The Tutorial Repeat The Tutorial