CASE STUDY - CHALLENGER TECHNOLOGIES
Now 37 years old, Singapore’s only homegrown consumer electronics chain Challenger serves over 500,000 ValueClub members across 40 stores island-wide. Shop the latest IT gadgets, lifestyle products and services with peace of mind. Plus, earn up to 1.5% member rebates to maximise your big-ticket tech purchase. Can’t find a product? Search Hachi.tech, Challenger’s online marketplace with over 50,000 products, offering local delivery or convenient in-store pickup.
We held our first meeting with Challenger’s buyer. It was an open and candid talk. Challenger is interested to explore contract manufacturing opportunities and we first discussed on an exclusive designed bluetooth headset model.
Understanding Challenger’s Objectives
To value-add to Challenger’s success, we need to understand from their marketing standpoint how we can introduce new products to meet their customers’ need. In this case we first discussed on the bluetooth wireless audio category which was growing steadily during the time.
D.LAB Product Mix – 4Ps
- Product – We proposed a mid-high value bluetooth headset with exclusive design with built-in high quality CSR chipset, offering good sound reproduction.
- Price – As we wanted Challenger to maximise profits, we suggested for them to retail at 3 times our contract manufacture cost.
- Place – D.LAB Bluetooth Headset DBH-501 was to be first launched at 22 challenger outlets
- Promotion – Promotion is the most important aspect of marketing with Challenger. Given the room for discount, Challenger does periodic discounts.
We recommended for D.LAB DBH-501 to be customized in terms of product design, color, weight, packaging and materials used for the wireless headphones. After hand-drawn sketches were shown, we worked with our factory to produce working prototypes. At the product development stage, the most important is to run through with Challenger cost and benefit analysis, we determine our price based on an open and transparent overview of the project cost. From the working prototype, we demonstrated to Challenger how the bluetooth headset can be paired with both andriod and apple phones. At the same time, we calibrated the Bluetooth IC chipset to improve the sound reproduction. After product evaluation is complete we document every feedback that Challenger has on the final product. We improved the initial prototype and got our factory to manufacture a final sample – we call it the golden sample. After the golden sample is confirmed. We then worked on the packaging box. Perhaps one of the most important aspect of the project. The packaging box was a crucial component of the gift and we developed a packaging box that looks premium yet a competitive price. With Challengers’s final agreement on the final sample we move on to the next stage – Production.
Before production started, we shared with Challenger our factory inspection report. The report showcase a summary of our factory’s capabilities and experience in managing global projects. The lead time at start of discussion was forecasted at 35 days for 3,000 bluetooth headset. At every stage of production, we give a timely update to Challenger on the completed production line. Example, after the headphone parts are constructed we replayed the information to Challenger.
For quality assurance and control, every material used for production is examined by our QC team. And in total there are 6 QC tests that are done for a completed bluetooth headset.
We completed the production in 30 days, 5 days ahead of time. We took a full day for quality inspection. Every headphone was inspected and after getting approved marked with a “QC passed” label. After updating the QC report to Challenger, we moved on to the next stage – shipment.
Product Shipment and Logistics
We stored boxes of bluetooth headset in 5-ply carton boxes (we avoided 3-ply to give a better protection for the gift boxes). Each carton box holds 20 wireless headphones and are printed with our standard labels. We informed our shipping company to be extra careful when handling the carton boxes, and at the same time installed wooden crates for added protection. The shipment from China to Singapore took around 10 days.
The final push was to inform our Singapore shipping and logistics vendor to handle the stocks with care at the port during retrieval. With all shipping documents prepared, our wireless headphones are finally shipped to Singapore. At first launch we delivered the stocks to 22 Challenger outlets.
Challenger was very pleased that the project was completed in time. At the outlets where the bluetooth headset was sold, sales is brisk and very soon we had our next order shipment.
All bluetooth headsets were offered a 1 year warranty. We provided a 1-to-1 exchange within the warranty period. Every container (3,000pcs), there were about 5 units exchange – that’s 0.01% defect rate less than 1% defect rate that we forecasted for Challenger.