Datavast Study Case
1. Describe the data storage industry in China in this case. Include comments on technology and issues in accepting new technology.
The data storage industry in China is relatively new and undeveloped. According to Hao, 40 per cent of SMEs don’t create backups of the firm’s information; 20 per cent still use CD for this purpose, which can be easily lost or broken and has capacity to store only 0.73 GB; and 30 to 40 per cent use external hard drives, that can store 2 TB, but also can be lost or damaged. On the other hand, large companies often store their core data in integrated backup systems, a higher costly reliable option offered by multinationals IT solution providers that has the highest level of customization …show more content…
Compare and contrast IT suppliers and system integrators (SI). What are the implications for Datavast and the DSB technology?
IT suppliers sell individuals components separately and provide low prices. They buy products from a manufacturer and mark-up the price to receive a slightly margin on sales. IT suppliers have a huge portfolio of products, but they don’t have much knowledge about them. Thus they only recommend products occasionally, if they are asked to do so.
On the contrary, systems integrators purchase products from manufacturers and turn it into to a full-package of solutions to the IT departments of the companies. They meet regularly with their clients and point what needs to be improved in the customers’ IT department. SI also recommend products and give technical support for the clients. They basically have the role of a consultant.
Since private-cloud storage is a new and unknown form of data backup in China, Datavast has to educate the public about the capabilities of the Data Security Box. Its product has large storage capacity, uses encryption to protect the data, it is resistant, unmovable, and less expensive than integrated back-up systems and it is hosted on the client’s own site. The access can be done virtually through the firm’s …show more content…
What is the decision Hao has to make? What are his alternatives? What are the risks of each alternative?
Hao has to decide in which segment he will offer his new product. He can either opt for target small-to-medium business or large companies. If Datavast targets large firms, it could charge RMB400,000 for the Data Security Box to the Systems Integrator, who would mark-up the price to sell to its clients and receive from Datavast 30 per cent margin on each sale (they usually make 10 per cent). Although Datavast margin on sales would be 75 to 80 per cent, the selling cycle would take a long time to be completed – two to three months –, because the decision-making processes are long and bureaucratic in this segment.
If Hao opts for the SMEs, he would have to sell the Data Security Boxes for lower prices (approximately RMB7,000) to the IT supplier, who would mark-up the price to make a small margin on sales. Although Datavast margin on sales would be 50 per cent because of the servicing costs, the sales cycle would be completed much faster than it would for large companies – two to three weeks –, which could provide a faster growth.
5. What do you recommend to Hao? Support your recommendations with
1. Describe the data storage industry in China in this case. Include comments on technology and issues in accepting new technology.
The data storage industry in China is relatively new and undeveloped. According to Hao, 40 per cent of SMEs don’t create backups of the firm’s information; 20 per cent still use CD for this purpose, which can be easily lost or broken and has capacity to store only 0.73 GB; and 30 to 40 per cent use external hard drives, that can store 2 TB, but also can be lost or damaged. On the other hand, large companies often store their core data in integrated backup systems, a higher costly reliable option offered by multinationals IT solution providers that has the highest level of customization …show more content…
Compare and contrast IT suppliers and system integrators (SI). What are the implications for Datavast and the DSB technology?
IT suppliers sell individuals components separately and provide low prices. They buy products from a manufacturer and mark-up the price to receive a slightly margin on sales. IT suppliers have a huge portfolio of products, but they don’t have much knowledge about them. Thus they only recommend products occasionally, if they are asked to do so.
On the contrary, systems integrators purchase products from manufacturers and turn it into to a full-package of solutions to the IT departments of the companies. They meet regularly with their clients and point what needs to be improved in the customers’ IT department. SI also recommend products and give technical support for the clients. They basically have the role of a consultant.
Since private-cloud storage is a new and unknown form of data backup in China, Datavast has to educate the public about the capabilities of the Data Security Box. Its product has large storage capacity, uses encryption to protect the data, it is resistant, unmovable, and less expensive than integrated back-up systems and it is hosted on the client’s own site. The access can be done virtually through the firm’s …show more content…
What is the decision Hao has to make? What are his alternatives? What are the risks of each alternative?
Hao has to decide in which segment he will offer his new product. He can either opt for target small-to-medium business or large companies. If Datavast targets large firms, it could charge RMB400,000 for the Data Security Box to the Systems Integrator, who would mark-up the price to sell to its clients and receive from Datavast 30 per cent margin on each sale (they usually make 10 per cent). Although Datavast margin on sales would be 75 to 80 per cent, the selling cycle would take a long time to be completed – two to three months –, because the decision-making processes are long and bureaucratic in this segment.
If Hao opts for the SMEs, he would have to sell the Data Security Boxes for lower prices (approximately RMB7,000) to the IT supplier, who would mark-up the price to make a small margin on sales. Although Datavast margin on sales would be 50 per cent because of the servicing costs, the sales cycle would be completed much faster than it would for large companies – two to three weeks –, which could provide a faster growth.
5. What do you recommend to Hao? Support your recommendations with