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Americas Sales

Americas Sales Business Plan

Americas Sales Business Plan2001

Table of Contents

I. Executive Summary ……………………………………………………………………………………..

4

II. Organizat ion…………………………………………………………………………………………………

5

A. Segment Overview…………………………………………………………….……………………….

5

B. U.S Channel……………………………………………………………………………………………….

5

C. Inside Sales / Sales Operations…………………………………………………………………….

6

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Americas Sales Business Plan

D. U.S.

OEM……………………………………………………………………………………………………

6

E. Latin America……………………………………………………………………………………………..

7

F. Canada……………………………………………………………………………………………………

… 7

III. Market Analysis…………………………………………………………………………………………….

8

A. Overview…………………………………………………………….

………………………………………. 8

B. Product Mix/Price Points………………………………………………………………………………..

9

IV. Sales: Strategic Overview…….……………………………………………………………………….

11

A. Strategic Overview…………………………………………………………….………………………….

11

B. U.S. Channel ………………………………………….

…………………………………………………… 12

C. U.S.

OEM……………………………………………………………………………………………………..

14

D. Latin America……………………………………………………………………………………………….

15

E. Canada……………………………………………………………………………………………………

….. 16

F. Inside Sales ………………………………………………………………………………………………..

20

V. Sales: Operations…….…………………………………………………………………………………...

21

A. Overview…………………………………………………………………………………………………….

. 21

B. Sales

Cycle…………………………………………………………………………………………………..

21

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Americas Sales Business Plan

C. Forecasting…………………………………………………………………………………………………

.. 24

VI. Programs….

………………………………………………………………………………………………….. 26

A. National Accounts (Platinum)………………………………………………………………………..

26

B. Alliance Partners………………………………………………………………………………………….

27

C. International………………………………………………………….……………………………………

28

VII. Telecommunications Init iat ive……………………………………………………………..………

29

A. Overview………………………………………………………….……………………………….

………… 29

B. Business Description………………………………………………………….………………………….

29

C. Broadband Market Analysis……………………………………….…………………………………..

30

D. Account Categories………………………………………………………….……………………………

30

E. Customer Profile………………………………………………………….……………………………….

31

F. Target Accounts………………………………………………………….……………………………….

31

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Americas Sales Business Plan

Table of Contents

VIII. National Account Profi les (U.S.)……………………………………………………..……………

32

A. Distribution..………………………………………………………………………………..………………

32

1. Ingram.…………………………………………………………………………………………………

32

2. Tech Data.…………………………………………………………………………………………….

33

3. D&H.

……………………………………………………………………………………………………..

34

4. Gates/Arrow.………………………………………………………………………………………….

35

5. Synnex.…………………………………………………………………………………………………

36

B. Retail………………………………………………………………………………………………………

….. 37

1. Best Buy………………………………………………………………………………………………..

37

2. Circuit City…………………………………………………………………………………………..…

38

3. CompUSA…………………………………………………………………………………………….

… 39

4. MicroCenter……………………………………………………………………………………………

40

5. Office Depot……………………………………………………………………………………………

41

6. Sam’s Club…………………………………………………………………………………………..…

42

7. Staples………………………………………………………………………………………………..

… 43

8. Wal-Mart……………………………………………………………………………………………..…

44

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Americas Sales Business Plan

C. Direct Mail………………………………………………………………………………………………..

…. 45

1. CDW……………………………………………………………………………………………………

… 45

2. Insight…………………………………………………………………………………………………

… 46

3. MicroWarehouse………………………………………………………………………………..……

47

4. PC Connection……………………………………………………………………………………

48

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Americas Sales Business Plan

I. Executive Summary

Introduction

The vision for the new U.S. Robotics can be summed up in three words: Leadership, Innovation, and Agility.

With analog modem products that are first-in-class as the cornerstone, we are structuring an aggressive

and inventive plan focused on strong customer relationships and streamlined processes.

As U.S. Robotics continues to increase its already dominant market share in the modem space, we will add to

that momentum by introducing exciting new Wireless and Broadband solutions. Our strong U.S. Channel

presence provides a pipeline through which we can develop these new opportunities.

Ultimately, we will work smart, take care of our customers, and remain on the leading edge of Analog, Wireless,

and Broadband connectivity solutions. As the U.S. Robotics brand has remained synonymous with quality

modems and market leadership, the new U.S. Robotics and its Sales Force will build on a tradition of

excellence.

Sales Overview

The responsibility for Worldwide Sales is shared by Brian W. Babcock, VP of Americas Sales , and Lars

Ole Hansen, VP Europe, Asia and Pacific Rim Sales (EMEA/APR).

On average, company sales break out as follows:

Key highlights of the Americas Sales Plan are:

Last Revision 3/5/01 Page 7

US Robotics Sales Mix

Americas65%

EMEA30%

APR5%

Americas Sales Business Plan

• The majority of Sales in the Americas come from the U.S. Channel segment.

• Key customer relationships with National Distribution, Retail, and Direct Mail Partners are the

cornerstone of our dominant market presence.• In January, USR held a 61.5% unit share and a 72.5% revenue share in Distribution, as well as a

31.8% unit share and 50.6% revenue share in Retail.

II. Organization

A. Segment Overview

The following chart provides an overview of each functional area of the sales organization. There are a total of

40 people in the organization. Strategic overviews of each segment are detailed in Section IV of the Plan.

Additional organizational detail, including specific roles and responsibilities, is included within each of the

following segment overviews.

B. U.S. Channel Sales

Last Revision 3/5/01 Page 8

R o b i n M c S u r l e yD i r e c t o r , U . S . C h a n n e l S a l e s

C h r i s B a z h a wU . S . O E M ( A c t i n g D i r e c t o r )

F e r n a n d o R o d r i g u e zD i r e c t o r , L a t i n A m e r i c a

B r o c k E v a n sD i r e c t o r , C a n a d a

B r a d H a r g r a v eD i r e c t o r

S a l e s O p e r a t i o n s / I n s i d e S a l e s

R i c k E r i c k s o nD i r e c t o r , R e t a i l P r o g r a m s

B r i a n W . B a b c o c kV P S a l e s , A m e r i c a s

Americas Sales Business Plan

II. Organization

C. Sales Operations / Inside Sales

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H o l l y O x f o r dW e s t e r n R e g i o n a l D i r e c t o r

P e g g y J a c k s o nC e n t r a l R e g i o n a l D i r e c t o r

J o e P e n n i n oE a s t e r n R e g i o n a l D i r e c t o r

J i l l e n e M c C a r t yM a n a g e r , T e l c o

R o b i n M c S u r l e yD i r e c t o r , U . S . C h a n n e l S a l e s

B r i a n W . B a b c o c kV P S a l e s , A m e r i c a s

M a r k H e r n a n d e zN a t i o n a l A c c o u n t s , W e s t

J o h n P o t o m i sN a t i o n a l A c c o u n t s , C e n t r a l

K i m b e r l y J o h n s o nN a t i o n a l A c c o u n t s , E a s t

F r a n c e s D a v i sI n s i d e S a l e s M a n a g e r

B r a d H a r g r a v eD i r e c t o r

S a l e s O p e r a t i o n s / I n s i d e S a l e s

J o h n n i e W h e e l e rA l l i a n c e P a r t n e r s , W e s t

T i a D i v i n eA l l i a n c e P a r t n e r s , C e n t r a l

L a T i a J o n e sA l l i a n c e P a r t n e r s , E a s t

D a v i d L o p e zP r e - S a l e s , W e s t

M e l i s s a A d u c c iP r e - S a l e s , E a s t

Americas Sales Business Plan

D. U.S. OEM Sales

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A n g e l a B a r r e t tA c c o u n t M a n a g e r

N i c k S c h e p o n i c kE a s t e r n R e g i o n a l M a n a g e r

D a n H o p p e rA c c o u n t M a n a g e r

R o b e r t C h e c h iS a l e s E n g i n e e r ( E a s t )

M a r k W i l l i a m sS a l e s E n g i n e e r ( W e s t )

C h r i s B a z h a wW e s t e r n R e g i o n a l M a n a g e r

( A c t i n g O E M D i r e c t o r )

B r i a n W . B a b c o c kV P S a l e s , A m e r i c a s

Americas Sales Business Plan

II. Organization

E. Latin America

F. Canada

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M a r i s o l D i a zS a l e s S u p p o r t S p e c i a l i s t

D a n i e l P e l l i g r i n iL A T M k t g . / B u s i n e s s D v l p .

J e n n i f e r M a r t i n e zD i s t r i b u t i o n M a n a g e r

A l e j a n d r o H e r e r aC h a n n e l D e v e l o p m e n t

I g n a c i o G a l l e g oC o u n t r y M a n a g e r

M e x i c o

I n g r i d M o n r o yC h a n n e l D e v e l o p m e n t

L i l i a n a G r i s a l e sC o u n t r y M a n a g e r

C e n t r a l A m e r i c a & A n d e a n R e g i o n

C r i s t i a n e S a n t o sM a r k e t i n g M a n a g e r

F e r n a n d o M u n h o zC o u n t r y M a n a g e r

B r a z i l

H e c t o r G o n z a l e zC h a n n e l D e v e l o p m e n t

G u i l l e r m o Z e i t l inC o u n t r y M a n a g e r

A r g e n t i n a , P a r a g u a y , U r u g u a y , C h i l e

F e r n a n d o R o d r i g u e zD i r e c t o r , L a t i n A m e r i c a

B r i a n W . B a b c o c kV P S a l e s , A m e r i c a s

K e a t i n g a n d A s s o c i a t e sC a n d i a n C h a n n e l R e p F i r m

( 4 ) U S R F i e l d A c c o u n t M a n a g e r s

B r o c k E v a n sD i r e c t o r , C a n a d a

B r i a n W . B a b c o c kV P S a l e s , A m e r i c a s

Americas Sales Business Plan

III. Market Analysis

For the purposes of this Plan, the Market Analysis will center around U.S. Robotics Core Products (analog

modems).

A. Market Overview

The following information provides a snapshot of the overall U.S. market for Analog Modems.

Analog ModemsU.S. Consumer Channel

January 2001 Sell-Through Summary

• Total U.S. sales of analog modems: unit sales total 415 Thousand units and $25 Million in sell-

through for January.

• Top 3:

Vendors in January were:

1. U.S. Robotics with $12.47 million in sales and a 50% dollar share

2. Zoom with $3.12 million in sales and a 12% dollar share

3. Creative with $2.85 million in sales and an 11% dollar share

Vendors year-to-date were:

Same as January

Products in January were:

1. 56K U.S. Robotics V.90 Faxmodem Ext PC with $3.7 million in sales

2. U.S. Robotics 56K V.90 PCI Faxmodem Int with $1.9 million in sales

3. U.S. Robotics 56K Performance Pro V.90 Int PCI with $1.52 million in sales

Products year-to-date were:

Same as January

• Market share trend for U.S. Robotics:

• YTD U.S. Robotics unit market share has increased to a highpoint of 33% (highest share

since March of ‘00)

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Americas Sales Business Plan

• YTD U.S. Robotics dollar market share has increased to 50%, a share not seen since May

of ‘00.

As reported by Levin Consulting. Source: PC Data – Reston, VA

III. Market Analysis

B. Product Mix / Price Points

The following outlines the top USR products by sales channel. Percentages shown indicate the average

percentage each product represents of overall sales

U.S. Channel

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Americas Sales Business Plan

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1

568656K External

27%$94.45

2

3CP5699A56K Internal PCI

25%$39.95

3

3CP5610A56K Performance Pro

14%$79.95

4

3CXM756-US56K Mobile

6%$196

5

3CP00305756K Performance Pro

5%$79.99

6

OTHERRemaining20+ SKU’s

27%

Americas Sales Business Plan

III. Market Analysis

U.S. OEM

OEM products are typically internal modems built into our customers PC’s and Laptops, therefor, no pictures are

included below with our top OEM SKU’s.

Latin America

Canada

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SKU ASP Description %1 USR325686D $109.00 56K External 29%2 3CP325699A $31.28 56K Internal PCI 20%3 USR325695 $78.20 Internet Call Modem 14%4 3CP325610A $62.56 56K Performance Pro 12%5 3CP325687C $78.40 Internal ISA 7%

Other 18%

SKU ASP Description %1 3CP263595-OEM-50 $19.79 56K Win Modem Dat/Fax 27%2 3CP263594-OEM-50 $24.00 56K Win Modem Dat/Fax/Voice 21%3 215686-03 $84.00 56K External 13%4 3CP2976-OEM-50 $46.00 56K PCI Internal Data/Fax/Voice 10%5 3CP2977-OEM-50 $38.00 56K PCI Internal Data/Fax 8%6 3CP215699A $39.74 56K Internal PCI 5%7 3CP1787E-OEM $40.00 56K ISA Internal 4%8 215686-C3 $74.80 220v 56k External 4%

Other 8%

SKU ASP Description %1 3CP3298-DEL $39.90 56K Controller PCI Data/Fax/Voice Internal V.90 28%2 3CN3BM1556-100-D $16.95 56K Mini PCI Internal V.90 18%3 3CP263595-OEM $22.00 56K WinModem PCI Data/Fax Internal V.90 14%4 3CP2977-OEM $40.00 56K Controller PCI Data/Fax Internal V.90 14%5 3CP2976-OEM $50.00 56K Controller PCI Data/Fax/Voice Internal V.90 11%6 3CP263594-OEM $24.00 56K WinModem PCI Data/Fax/Voice Internal V.90 12%7 Other 3%

Americas Sales Business Plan

IV. Sales: Strategic Overview

A. Strategic Overview

The US Robotics Americas sales organization is inclusive of the U.S., Canada, Mexico, and Latin America. The

sales team has been organized to grow and support the Americas four primary sales channels:

1) U.S. Channel 2) U.S. OEM 3) Latin America 4) Canada.

The sales organization strategy is based upon a focused plan of action, which include three key areas of

responsibility:

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Americas Sales Mix

Canada6% LAT

15%

US58%

U.S. OEM21%

Americas Sales Business Plan

1. Customer Relationships – Deep relationships at the senior executive level and down with a

defined group of key retailers, resellers, distributors, and OEM manufacturers. Beyond

sales, these customers provide valuable insight into the needs, demand, and issues of the

SMB and Consumer market spaces.

2. Business Planning – Sales management and field sales representatives are required to

maintain a current business plan for their respective areas of responsibility. This process is

critical in understand product demand, specific trends, and the overall health of the

business.

3. Forecasting – Through customer relationships and business planning, the sales

organization is able to accurately forecast by product and customer the anticipated demand

of each SKU. This detailed monthly process is linked closely and communicated with both

the Supply Chain & Product Management organizations to insure the correct ratios of

product scheduling and manufacturing.

By staying focused on these three areas, the sales organization is better able to understand the true demand

and anticipate the direction of the market. The processes are in place to track and manage the business so that

inventories, budgets, and supply are all in line with the overall company objectives.

IV. Sales: Strategic Overview

B. U.S. Channel

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U.S. RoboticsU.S. Robotics

DistributorDistributor

RetailRetail VARVAR

Direct MailDirect Mail

EnduserEnduser

Americas Sales Business Plan

U.S. Channel Sales is a field organization managed by Robin McSurley, Director of Channel Sales . A

Regional Director divides channel Sales into three regions each managed.

*Denotes Distributor

Each Regional Director manages 3-4 senior-level Account Managers who are responsible for the day-to-day

management and sales growth of these targeted top-tier accounts. The Regional Directors are also focused on

strengthening relationships with senior management at each of these accounts. These relationships are critical

as we partner with them to drive marketing and demand creation programs to pull product through the channel

to the enduser.

The Channel represents both the majority of current sales as well as the area of greatest growth opportunity.

Our strong relationships coupled with the market agility of key Channel partners also allows us to greatly

influence this dynamic area of the business. The Channel consists of Value Added Resellers (VAR), Retailers,

Direct Mail and Distributors.

Channel Overview and Definitions

A VAR is typically focused on a given business segment such as

Small/Medium Business (SMB), Corporate, Enterprise, or

Government/Education. The “Value Add” of a VAR usually includes IT

service and support on top of the hardware and/or software being sold to

the customer, also known as the enduser.

Retailers , such as CompUSA and Best Buy primarily sell to Consumers,

but also may overlap in the SMB space somewhat.

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Holly Oxford West

Holly Oxford West Peggy Jackson

CentralPeggy Jackson

Central

Joe Pennino East

Joe Pennino East

Top Customers:Ingram Micro*

InsightFry’s

Buy.com

Top Cust omers:Ingram Micro*

InsightFry’s

Buy.com

Top Cust omers:CompUSABest Buy

MicroCenterCDWDell

Top Cust omers:CompUSABest Buy

MicroCenterCDWDell

Top Customers:Tech Data*

D&H*Circuit City

StaplesOffice Depot

PC Connection

Top Cust omers:Tech Data*

D&H*Circuit City

StaplesOffice Depot

PC Connection

Americas Sales Business Plan

Direct Mail resellers, such as CDW and Insight, are focused primarily on the SMB space. They also act as

resellers, but do not provide IT services

Distributors act as the warehousing and logistics arm and serve as the fulfillment mechanism VAR’s, Direct

Mail, and Retailers. The distributor also adds value to the manufacturer by providing a strong marketing

infrastructure specifically designed to drive sales through the Channel. Although USR utilizes 5 distributors,

Ingram Micro (Santa Anna, CA) and Tech Data (Clearwater, FL) are the primary distribution customers.

IV. Sales: Strategic Overview

Key channel partners include:

Distributors: Ingram Micro, Tech Data, D&H, Synnex

Retailers: CompUSA, Best Buy, Circuit City, Staples, Office Depot, MicroCenter

Direct Mail: CDW, Insight, PC Connection, MicroWarehouse

Tier-2 Resellers: 3,000+ VAR’s, Resellers, and Small/Regional Retailers

Relationships with both the distributors and the Retailers, VARS, and Direct Mail who all purchase through

distribution are key to creating pull-demand in the SMB and Consumer market space.

Roughly 30% of the channel business is through the small and medium VARS purchasing through distribution.

As a result, a compelling VAR program is also in place to help grow this segment of the business and provide

sales with market intelligence in this space as well. The VAR program is supported by a subset in the Inside

Sales group.

Channel Growth

The focus of the Sales strategy for the U.S. Channel in an effort aimed at increasing the size of our

available pipelines in Retail, Mail Order, and the Reseller community.

The sales organization has been successful in significantly increasing our pipeline in the following areas:

1. Total number of National Partners.

2. Number of available Sales Outlets.

3. Average number of Product SKU’s per outlet.

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Americas Sales Business Plan

4. Addition of new product lines.

IV. Sales: Strategic Overview

C. U.S. OEM

OEM (Original Equipment Manufacturer) is a sales unit designed to capitalize on the market in which USR acts

a supplier of components to other major manufacturers. As an example, Dell and Gateway may integrate U.S.

Robotics modems into a given percentage of their PC offerings.

The OEM group is focused on strategic opportunities with large computer manufacturers (Tier-1) as well as

supporting smaller customers (Tier-2) who may be regional or lower-volume manufacturers. Today, the OEM

group is primarily focused on our core Analog and PC Card business. As we move forward, we are moving

swiftly into additional emerging markets such as Wireless and Soft-Modems.

Current Tier-1 Customers include:

Dell, Micron, Gateway, IBM, Hewlett Packard, Sun, and Compaq.

Last Revision 3/5/01 Page 20

3

1,424

6

ProductLine

Plat inumCust omers

SalesOut let s

AVG SKU’sper Out let

Market s

V.90 ModemsPC Card Modems

OEM

V.90 ModemsPC Card Modems

OEMV.92 ModemsCable Modem

DSLWireless

Q3/ Q4 ‘00 Q1/ Q2 ‘01

Ingram,Tech Data,CompUSA, Best Buy,Staples (US Only), CDW

Ingram,Tech Data, CompUSA, BestBuy, CDW, Circui t City , St aples(Canada) , I nsight, Fry ’s,MicroCent er, Sam ’s, Walmart

5

5,793

12

Consumer, SMB, OEM Consumer, SMB, OEM, Telco,VAR Program

Americas Sales Business Plan

In addition to high-volume core analog business, we also have significant opportunity in bringing additional

products to market by partnering with our own OEM suppliers, such as Broadcom and Conexant. By leveraging

the USR brand with new cutting-edge technology, USR is able to enter new markets, such as Soft-Modems

Broadband, Cable, and Wireless quickly and efficiently.

NOTE: Please see Section V.B. for more detailed information on the OEM Sales Cycle.

Last Revision 3/5/01 Page 21

Americas Sales Business Plan

IV. Sales: Strategic Overview

D. Latin America

Overview

The Latin America group includes sales to Mexico, Central America, Brazil, Argentina, Paraguay, Uruguay, and

Chili. The Latin American organization sells through resellers, distributors, and OEM relationships in the region.

Key Latin American customers include:

OEM Acer Mexico

Distribution Ingram Mexico, Intcomex, Tech Data Argentina

Resellers Acron, Vast Holdings, MPS Mexico, CHS Mexico, SED International

Key Objectives

• Local Support:

- RMA / DOA

- Call Center pre & post sales support

- End users warranty

• Launch and develop broadband products.

• Establish local subsidiary.

Sales Region Overviews

Below is a breakout of forecasted revenue for the Latin American region.

Last Revision 3/5/01 Page 22

Region 2001 ForecastArgentina $10,000,000Mexico $9,000,000Brazil $9,000,000Miami Operations $7,000,000Andean Region $4,000,000

$39,000,000

Americas Sales Business Plan

IV. Sales: Strategic Overview

Competit ion – Latin America

• AOpen launching Controller modems.

• Very aggressive price for new Genius retail internal modem ($ 39 street price).

• OEM Motorola’s PC chips still under $ 18.

• External D-Link w/chipset Rockwell $ 82.

• Retail PCI Internal D-Link $ 46.

• External C-Net 56K v.90 retail modem $ 58.

• OEM Internal C-Net w/chipset Lucent $ 16 !!!

Note: Please refer to the more comprehensive Latin American Sales Plan for more detail.

E. Canada

Canadian Channel Overview

U.S. Robotics (Canada) Corporation (formal entity realized January 1, 2001) began its Canadian operation September 5, 2000. In February 2001, U.S. Robotics elected to outsource its sales and marketing functions in Canada to Keating Technologies Inc.

Keating is a leading branch outsourcing service to the microcomputer and consumer electronics industry in Canada. They have expertise in developing and penetrating markets with over thirteen years of growth and

Last Revision 3/5/01 Page 23

Argentina26%

Mexico 23%

Brazil23%

Miami Operations18%

Andean Region10%

Americas Sales Business Plan

success in the Canadian market. They have offices in strategic locations across Canada in Vancouver, Toronto, Montreal and Halifax. This relationship allows U.S. Robotics to accelerate our go to market strategy while reducing the cost of sales by leveraging Keating’s scale and scope of operations.

Brock Evans, our Director of Canada manages the Keating relationship. The Keating account coverage model has allowed U.S. Robotics to go from a sales force of four to eleven. In addition, we will be leveraging their relationship with OEM accounts in Canada. This will allow us to incrementally grow the Canadian revenue by about $4M.

The structure of the Canadian Channel is similar to the channel structure in the United States. We have four distribution partners: Ingram, Merisel, MultiMicro and Tech Data. Last year the sales for Distribution were $16.9M.

Canadian Distribution Sales Mix

IV. Sales: Strategic Overview

Our distribution partners provide USR products to our Retail, Catalog and VAR customers. In Canada our top ten channel customers include:

Rank Customer Type 2000 Revenue 2001 Forecast

1 Future Shop Retail $1.6M $2.2M2 Business Depot Retail $1.3 $2.0M3 G.E. Capital Integrator $700k $500k4 London Drugs Retail $400k $500k5 EDS Integrator $390k $400k6 Dell Canada Catalog/Corp $380k $400k7 Insight Catalog $220k $2708 MicroWarehouse Catalog $200k $2609 Telus NSP/Telco $178k $24010 Misco Catalog $155k $240

Top ISP and Telco Accounts (Prospect)

• AOL • UUNet • Bell Canada

• Sprint • AT&T/Netcom • Telus

Last Revision 3/5/01 Page 24

Ingram35%

Merisel34%

Tech Data24%

MultiMicro7%

Americas Sales Business Plan

• Bell Mobility • Internet Direct • Rogers Cable

• Cantel • IDirect • MT&T

• Manitoba Tel

• Shaw

• SaskTel

• Cogeco

OEM Accounts

• Supercom • Northern Micro • Cybernetique

• Mind Computer • Elco • to name a few

Sales Demand

• Pricing for the Canadian market does not hit the price points needed for optimal sales. • Canadian Price Points required to move product: $49, $99, $149, $199, $249, $299 and on in $50

increments (Canadian dollars).

Growth Plans

End-Users

Corporate End-user (HOW WE WILL SELL TO THEM)

Leverage Keating’s 14 year database of over 350K customer contact records. 40% of these records are true

corporate customers, the others being consumer and SMB. This market segment would be telemarketed by

Keating’s inside sales team to generate demand for U.S. Robotics’ products. This inside sales team would work

in concert with NRO/VAR sales reps to maximize the conversion of leads to sales the corporate space for this

level of reseller.

IV. Sales: Strategic Overview

Retail Segment

Gold Retail Accounts (t ier one)

• Tier 1 accounts represent approximately 25% of total channel sales – Top 15 accounts

• Increase share of shelf, floor stacks, end caps and out of aisle programs

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• Growth programs at all accounts

• Consistent MDF/Co-Op based on ROI

• Soft bundles, special promos, sales contests, vendor days

Silver Retai l Accounts (t ier two)

• 100 accounts

• Reseller Advisory Council

• Growth programs at top 25 accounts with marketing resources

• End Caps, soft bundles, special promotions

• Inside Sales coverage

Bronze Retail Accounts (t ier three)

• 3000+ accounts

• Reseller Advisory Council

• National marketing promotions

• Inside Sales coverage

Distribution

• Increase mind share on the sales floor and with executives

• Maximize revenue

• Competitive Analysis to understand the market conditions

• Maximize USR MDF dollars available to increase brand

• Growth programs (increase customer breadth, manage VIR goals, etc.)

• Focus activities beyond Platinum retailers

• Target marketing activities through measurable ROI analysis

• Promote improved partnerships:

• Manage inventory on hand to ensure the right product mix

• Joint profit objectives

• Consistent sell in/sell out strategies each quarter

• Dedicated Distribution Account Manager

Channel VARs

NRO/Tier 1 VARs

• Increase penetration of the VAR channel

• Focus on top Tier 1 accounts (20 accounts) – approximately 25% of channel sales

• Internal sales/marketing promotions at the top Tier 1 accounts

• The VAR segment will be led with a new VAR Pack pricing model.

• Growth program to the VARs through a “Platinum Partner Program”

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Tier 2 and Tier 3 VARs

• Reach programs for the top Tier 2 and Tier 3 VARs (400 VARS)

• Evaluation, Seed, Dealer Demo, Employee Purchase Programs

IV. Sales: Strategic Overview

OEM/SI– approximately 20% of channel sales

• Our real challenge here is to identify the primary focus of each customer and create a multi-tiered

product/pricing strategy that will ensure channel integrity.

• White box represents over 45% of CPU sales in Canada

• Leverage current Keating relationships

• Target top 10 accounts

• Pricing and product strategy

• Co-marketing incentive program for OEM partners to install “USR Inside” campaign

Education

• Education as a segment includes K-12, Post Secondary (Universities and Colleges) and Institutional

(research facilities, grants).

• Identify pricing, product and segment strategy

• Leverage existing VAR/Campus Retail channel

• Campus Retail Canada (CRC) is a collective of 34 university and college campus stores across Canada

and serves one million students and 100,000 teaching and support staff with technology solutions.

Together, this consortium represented CDN$120 million in IT sales in 1999, of which 60% were

institutional purchases (research labs, administrative and facilities equipment) and 40% student

purchases.

• Penetrate the post secondary education market with a formal Education Program administered through

distribution to the educational resellers.

Government

• Includes government business, namely municipal, provincial and government funded organizations such

as hospitals and crown corporations

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• Leverage NRO’s, VARs and synergy partners

• Targeted events

• Bids and Tenders

ISPs

• We will develop a list of target accounts for new business and sales promotions to end-users. Focus on

DSL/Cable and other high-speed broadband technologies.

• Leverage the @Home cable consortium and retail outlets to increase the USR brand as a technology

leader in the analog and digital market.

• Leverage the Bell Canada and Telus Canada DSL store fronts to introduce USR as a world leader in

high speed internet connectivity.

• Establish USR as the “standard product offering” for new subscribers in the cable and DSL space.

IV. Sales: Strategic Overview

F. Inside Sales

The Inside Sales organization is currently in the process of being reorganized as outlined in this section of the

Plan. Inside Sales, as a unit, is primarily responsible for the following items:

• Inbound / Pre-Sales phone traffic, averaging 3,000 calls per month.

• Outbound sales and support phone calls to 300+ National and Alliance Partner accounts.

• Outbound / Inbound calls and opportunities to an undetermined number of Corporate accounts.

• Database management: Tracking account activity and capturing Inbound customer contact

information.

• Leads: Managing, disbursing, and following up leads passed to key channel partners

There are three job-levels that make up the overall direction and focus for Inside Sales:

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1. Inside Sales, National Accounts – Responsible for supporting named National accounts as well as

larger Corporate Accounts.

2. Inside Sales, Alliance Partners – Responsible for managing sales relationships with Alliance

Partners (Tier-2 Resellers) as well as small to medium business accounts. Will also handle overflow

Pre-Sales inbound phone calls.

3. Inside Sales, Pre-Sales – Primarily responsible for fielding Pre-Sales phone calls, capturing

customer information from Pre-Sales calls, and properly routing calls as appropriate.

National Account Support

National Account relationships will be managed by the Field Sales Team and supported by the Inside Sales

National Account reps. National Accounts Named National Accounts are as follows:

Distribution Retail Direct Mail

Ingram Best Buy CDW

Tech Data CompUSA Insight

D&H Circuit City PC Connection

Synnex Office Depot MicroWarehouse

Gates Arrow Staples

Sam’s

Walmart

Alliance Partners

Alliance Partners are all Tier-2 Resellers and Retailers outside of the named National Account list. Alliance Reps

will be responsible for primary account management of these 3,000+ accounts.

Pre-Sales

Pre-Sales accounts may be a mix of Consumers, Resellers, and Corporate accounts calling in for general

information or looking to engage with U.S. Robotics.

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V. Sales Operations

A. Overview

The Sales Operations role is designed to provide input into the overall sales strategy as well as manage the

infrastructure and processes necessary to execute upon the strategy. Sales Operations works closely with the

Sales Organization, Supply Chain, and Product Marketing to insure communication as it relates to the forecast

and build of products. The Director of Sales Operations works closely with the VP of Sales on developing and

executing and overall Sales business plan.

Sales Operations also tracks and analyzes key sales figures to determine market trends. Product run rates and

price points are also closely monitored, which is key to managing sales-out and inventory levels.

In addition, this role is responsible for the design and management of VAR and Retail marketing programs and

MDF budgeting.

B. Sales Cycles

The sales cycle for current U.S. Robotics products varies by Market Segment. The following summarizes the

average sales cycle and key steps within each primary segment. The information outlines below is focused on

U.S. Robotics Core Products (Analog modem line: External, Internal, WinModem, Softmodem, and Mobile

products).

1. U.S. Channel

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FinishedGoods

Distribution

DirectRetailer

VAR/Reseller

Direct Mail

Retail Consumer

SMB, Corporate

SMB, Corporate,Enterprise

12 3

4

1

Americas Sales Business Plan

Chart Detail:

1. The first step in the U.S. Channel sales cycle involves selling finished product into either a distributor, or to a

Direct Retailer (currently, only 2 retailers purchase direct from USR.) The U.S. Channel is focused on the

Sportster product line, which makes up approximately 96% of Channel Sales. Typically, USR builds to and

houses 3-4 weeks of Sportster inventory for the Channel.

2. Distribution, on average, purchases enough product to mirror the USR inventory model and maintain 3-4

weeks of inventory for each SKU. Each SKU is tracked weekly to assess changes in run rates.

3. The majority of VAR’s and Resellers do not maintain an inventory of product and purchase as need as

business is won from their respective clients. The sales cycle to an SMB or Corporate customer ranges from

2-6 weeks for smaller companies, up to 8-12 weeks for Enterprise clients. Steps include 1) Defining

Requirements 2) Evaluation 3) Testing 4) Requisition 5) Purchase.

4. Retailers target maintaining tighter inventories at 2-3 weeks on hand. Sales to consumers are primarily

driven by a combination of Price Point and brand recognition. Therefor, the sales cycle, driven by demand,

ranges from 4-8 weeks from Step 1 to Step 4.

V. Sales Operations

2. U.S. OEM

Tier-1 Customers: (National-level partners such as Dell and Compaq)

Chart Detail:

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FinishedGoods

QualificationProcess

1

Procurement

Approve/Disapprove

HubOperations

Purchase toDemand

2 3 4

New Customers: 6-8 Month CycleExisting Customer/New Product: 3-4 Month Cycle

ContractReview

Label Process/Changes

Americas Sales Business Plan

1. The sales process for Tier-1 OEM’s begins with a Qualification Phase in which they perform all the

required compatibility and quality-assurance testing. This phase typically lasts 90-180 days.

During this time, the Contract Review process also begins. Based on qualification result

assumptions, both parties begin to formulate contract points and potential volume commitments.

The Contract Review may take 45-60 days.

2. Once the Qualification Process is complete, the customer either approves or disapproves of the

basic product design and specs. If approved, the Procurement cycle begins. This includes custom

labels required to scan and track product as well as any changes to builds and materials needed.

This overall process can take 30-45 days.

3. After procurement and labeling is well under way, new Hub Operations must be set up or existing

Hubs must be prepared to handle the incoming product. A Hub is a physical point of distribution in

which OEM product is housed for the OEM customer to pull from as production levels require. This

segment of the cycle may take 30-60 days. Typically, the goal is to maintain no more than 2

weeks inventory at the hubs.

4. OEM Customers may purchase to demand levels once these processes are complete. This is the

actual point of sale in the OEM process, and USR invoices the OEM customer.

V. Sales Operations

Tier-2 Customers: (Smaller or Regional customers)

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FinishedGoods

QualificationProcess

1

Procurement

Approve/Disapprove

Purchase toDemand

2 3

New Customers: 30-60 Day CycleExisting Customer/New Product: Less than 60-day Cycle

ContractReview

Americas Sales Business Plan

Chart Detail:

1. The sales process for Tier-2 OEM’s, in comparison, is simpler and much short than Tier-1. The

Qualification phase normally takes less than 30 days. Requirements for Tier-2 OEM’s are not as

stringent as Tier-1 customers. Contract review is not as time-consuming, as very few modifications

are required.

2. Materials are procured by USR to build based on customer demand forecasts for product. No Hub

Operations are required for Tier-2. Typically this phase may take up to 30 days, but can be

much shorter.

3. Tier-2 customers purchase to demand directly from USR. USR works to maintain a minimal 2 week

or less inventory and build product on an as-need basis (Just-in-time inventory)

V. Sales Operations

C. Forecasting

Process Overview

The following outlines the basic overview of the Sales forecasting process. The final product will mirror the

overall company forecast template.

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Each of the three regions will be responsible for reporting their numbers as a rolling 12-month forecast. Although

the final forecast will be a simple monthly number by SKU, the detail behind it will allow us to analyze the data

by Tier-1 & Tier-2 customers as well as the percentage flowing through each distributor.

Tier-1 customers are defined as identified National Channel accounts (32 Customers). Tier-2 are all remaining

VAR’s. Retailers, and other distribution customers outside the Tier-1 category.

Forecasting Schedule

The forecast will be due to from each region to Robin McSurley on the 2nd Monday of each month and starts

with the following month.

For 2001, the due dates are:

January 8 July 9

February 12 August 13

March 12 September 10

April 9 October 8

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MasterList

Includes each Tier-1 Customer + Tier-2 category

I ngram TechDat a

D & H Arrow

OEM Lat inAmerica

Canada

Synnex

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May 14 November 12

June 11 December 10

V. Sales Operations

Process Detail

A set of 12-month forecast templates will be distributed to each Regional Director to disseminate among the

sales team as needed.

The above graphic is a sample of the forecasting template. Normally, the only column the Sales Rep will need to

fill in is the QTY (Quantity) column. The other columns will be filled in ahead of time on the template.

The columns are defined as follows:

Segment –Denotes one of the 4 sales segments, US, OEM, Latin America, or Canada.

Distributor – Simply denotes which distributor this segment of the forecast is for.

Customer – Will denote each of the Tier-1 customers individually, each with it’s set of SKU’s to forecast. This

allows us to track the percentage of any given product that a Tier-1 purchases though any given distributor. All

Tier-2 business will be combined into the single Tier-2 category.

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The remaining columns are self-explanatory.

This spreadsheet will be combined each month to form a database from which the data can be summarized in

any of several different formats, including the company standard template utilized for

Forecasting Rationale

Supporting the numbers must be the market intelligence that leads to the forecast. A combination of historical

data and subjective market data will help to validate the overall forecast.

Some basic questions to keep in mind for forecasting assumptions are:

• When a number is lower or higher than expected, why? What specific factors affect it?

• Price point analysis – What spec/street prices make up the volumes?

• Competitive factors.

• Other key issues affecting sales.

• Proposed actions or solutions.

VI. Programs

A. National Accounts (Platinum)

North America Channel Sales is currently focused on targeting specific national Retail and Direct Mail accounts, through field appointments, for the dual purpose of enhancing customer relationships and implementing new Channel sales programs. These key national accounts are enlisted in U.S. Robotic’s Platinum Partners Program.

The primary Platinum Partners targeted are listed below:

AccountBest BuyCDWCompUSACircuit CityInsightMicroWarehouseOffice DepotPC ConnectionSam’sStaples

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Wal-Mart

The Platinum Partners Program is based on the terms and conditions as outlined by Levin Consulting for Retail and Direct Mail programs. With the 2001 Americas MDF budget now in place, Sales has outlined the specific accruals and percentages for the accounts listed below. Sales is also in the process of finalizing and delivering programs to Sam’s, Wal-Mart, and PC Connection.

Account Ad Funds

MDF VIR Total

Best Buy 3.0% 2.0% 1.5% 6.5%CDW 3.5% 0.0% 0.0% 3.5%

Circuit City 6.0% 0.0% 3.0% 9.0%

CompUSA 6.0% 0.0% 3.0% 9.0%

Insight 3.5% 0.0% 0.0% 3.5%

MicroWarehouse 3.0% 0.0% 0.0% 3.0%

Office Depot 4.0% 2.0% 1.0% 7.0%

Sam's 2.0% 0.0% 0.0% 2.0%

Staples 4.0% 1.0% 1.5% 6.5%

Walmart 2.0% 0.0% 0.0% 2.0%

Category Descriptions:

Ad Funds – Core advertising dollars accrued based on Sales-Out.MDF – Discretionary funds accrued and utilized, at USR’s discretion, for specific programs.Max VIR – Represents the maximum percentage exposure if the top is attained. Volume Incentive Rebates will be assigned to each account with 2-3 bar levels (sales-out goals) and a corresponding rebate percentage. VIR’s will be assessed on a quarterly basis.

VI. Programs

Platinum Program Components

In addition to the ad funding, MDF, and VIR’s put in place to further drive business and increase market share,

the Platinum Program allows us to support these partners in others areas as listed below:

1. Inside Sales Support – Dedicated USR Inside Sales team members support Platinum Partners in

the following areas:

• Product support, information, and roadmaps.

• Special pricing requests.

• Outbound, regular communication.

• Lead generation.

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2. Product and Market Training – USR provides field-level training though a third-party

organization. USR supports Retail partners with in-store training and demos, as well as participation in

vendor floor days at key Direct Mail partners.

3. Special Pricing Bid Desk – Platinum Partners receive 2-4 hour priority response on competitive

and volume pricing opportunities.

4. Partners Web Sight – USR is currently developing a password-protected websight to be used as

an additional resource for our partners to download product information and access other USR

resources such as product images, logos, and technical support.

B. Alliance Partners

The U.S. Robotics Alliance Partner program is targeted at increasing our reach into the Small/Medium VAR and

Reseller community. Tier-2 VAR’s (The top 300 VAR’s outside of named National Accounts) represent roughly

30% of North American Channel sales.

The Alliance program centers around the USR Inside Sales team who maintain the primary responsibility for

proactively managing and growing relationships with the top 300 of our 3,000 VAR’s who purchase through

distribution. They are also available as needed for the remaining Tier-3 VAR’s.

This program is currently in the process of designing process and implementation with a Targeted rollout for the

first part of Q2, 2001.

The Alliance Program includes the following components:

• Inside Sales Support

• Marketing Support & Communication

• “Partners Place” Web Sight

• Certification and Training

• Evaluation & NFR Units

• Special Bid Programs

• Co-Marketing Programs (only available to Resellers with $50,000+ annual revenue)

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VI. Programs

C. International

Currently, Latin America has a program in place known as Direct Connection aimed at increasing VAR sales

and participation.

WEB SIGHT: www.usrdirect.com

U.S. Robotics Direct Connection is a sales incentive program dedicated to rewarding loyal Reseller customers. Resellers can earn prizes for selling U.S Robotics' products. The program is facilitated through a web-based registration and point redemption system.

U.S. Robotics Direct Connection allows Resellers to earn points in two different ways:• Based on the revenue of purchases of U.S. Robotics products- earn 1 point in the program

for every $500(U.S. Currency) spent. • Based on the frequency of U.S. Robotics purchases- receive points depending on the

amount of consecutive months that you purchase U.S. Robotics products in the quarter.

Program Rules

• U.S. Robotics products purchased between January 1, 2001 and December 31, 2001 are eligible for the

program

• Only registered resellers will be eligible to win prizes with U.S. Robotics Direct Connection.

• U.S. Robotics Direct Connection only applies to resellers in Mexico, Central America, South America,

and the Caribbean.

• All purchases must be made from authorized distributors of U.S. Robotics. A list of registered resellers

will be found on our website at the end of June. In order to remain in the program resellers must abide

by the frequency and revenue requirements of their respective U.S. Robotics Direct Connection

category level. Those who don't meet their requirements will be eliminated from the program.

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VII. Telecommunications Init iative

A. Overview

Note: The Telecommunications Initiative was recently started with the hire of Jillene McCarty, Manager of Telco Sales, January 3, 2001.

The fast-paced, exciting world of Digital Subscriber Line (DSL) and High Speed Broadband Connectivity

(Internet Cable,) has opened up a monumental opportunity for the suppliers and manufacturers of the transport

equipment necessary to facilitate this technology.

U.S. Robotics is in a unique position that enables the company to utilize its name recognition, it’s commitment to

quality, its existing relationships and sales channels and the development of its telecommunications modems.

The following sales plan will outline the initial scope of the project. It will support the premise that the market

demand is optimal and will outline the key personnel and target accounts that will make this endeavor

successful.

Identification of the following portions of the business model is included in this plan. The basic summary outline

follows:

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• Description of the business of high-speed connectivity and it’s two related technologies

• A summary of US Robotics history and it’s involvement in the current endeavor

• A general overview of management and how it will relate to this plan

• The basic description of the products and services

• A detailed listing of the organizational structure and it’s team members

• General market information

• Target market and account category information

• Initial target account list.

Additionally, price-point information, competitive analysis, as well as forecast information will be the next step in

the evolution of this working document.

At this point, the current project forecast numbers will remain the same. However, the current target dates to

meet those deadlines will need to be adjusted to reflect both production/development schedules and the typical

90 – 240 day lead time in the sales cycle, currently experienced in the telecommunications market.

As the growing family of high-speed connectivity technologies emerges, along with, already, enormous

bandwidth demand increasing, the future success of this venture is to be taken on with the spirit of excitement.

At the same time US Robotics, Telecommunications division must and will work fervently to stake our claim in

this market, that while continuing to grow, is well under-way.

B. Business Description

Digital Subscriber Line and Internet connectivity via broadband are simply Internet connections piped into the

business or home via a phone line in the case of DSL and via coaxial cable installed for cable television.

Neither DSL (ADSL) or Broadband access to the Internet, actually refer to a line, but to modems that convert a

standard transport mechanism into a high-speed digital pipe.

It is the mission of the Telecommunications Division of US Robotics to become the market leader, supplying

DSL and Cable modems throughout North America.

US Robotics has proven to be an industry leader in the design, manufacturing and sales of analog modems.

However, with the advances in telecommunications, coupled with market demand, US Robotics is striking out in

a new direction to directly service the telecommunications industry with two new products.

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VII. Telecommunications Init iative

US Robotics will offer a DSL Modem and a Cable Modem to be supplied to meet the demand of high-speed

Internet connectivity.

While there are other products on the market, there is clearly no competition when factors of quality, reputation

and longevity in the modem business are examined.

In addition, the following information is in its evolutionary stage and will be reported when applicable:

• Product and Service Uniqueness

• Product and Service Descriptions

• Competitive Comparisons

• Current Plant Production and Capacity

• Production Issues

C. Broadband Market Analysis

Today, about 44 million homes in the U.S. and Canada – 40% of those nations’ households with cable television

– are equipped for service. Thousands of homes are being upgraded every day and are being upgraded for the

purpose of offering broadband services.

The worldwide DSL subscriber installed base jumped 447 percent in 1999 and is expected to explode from 4.5

million in 2000 to 66.4 million by 2004. The United States currently represents more than half of the worldwide

DSL lines installed. With approximately ten million households currently subscribing to DSL, in the US alone,

the market potential is evident.

In reviewing the demand for

D. Account Categories

1. EMERGER'S AND TIER 2 & 3 CARRIERS

A. CABLE

B. DSL

2. MAJORS AND TIER 1 CARRIERS

A. CABLE MSO’s

B. DSL

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3. STOCKING DISTRIBUTORS – VARS AND TURNKEY SOLUTION PROVIDERS

A. CABLE

B. DSL

4. OEM’s

A. CABLE

B. DSL

VII. Telecommunications Init iative

E. Customer Profile

The basic premise of the customer profile identification is to determine where the purchasing power lies within

the intricate network of service providers, carriers and partnerships.

The trend that we see in the cable industry is that of the large MSO’s teaming with large ISP’s to offer service.

Ultimately, the hardware decisions and the maintenance of the network typically fall on the shoulders of the

MSO. However, it is important to assess exactly where the decisions are being made.

An example of this is the teaming of AT&T and @Home. AT&T Broadband formed an alliance with @Home,

with the resulting product being high-speed connectivity marketed as AT&T@Home.

In the case of DSL, the market shows the same trend, but not to the same degree. There are many more

players in the DSL arena due to the abundance of CLEC’s and the new fiber optic networks that have been

installed since 1996.

One of the first goals will be to assign these accounts to teams, communicate information already gathered

regarding the account and set objectives to gain knowledge and market share within the account.

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F. Target Accounts Columns= 1 Account 2 Type

@Link CLECA Novo Broadband(Cable Link)

MSO

ADC OEM’sAdelphia Communications Corp

Turnkey

AllTelll ISPAllTell CLECAeerie CLECAlopa Networks MSO America On Line ISPAmeritech CLECAT&T LECAvista Communications CLECBirch Telecommunications CLECBlack Hills Fiber Com MSOBlueStar Communications CLECBroadslate CLECCablevision MSOCentruy Tel Communications

CLEC

Chazy and Westport Telephone Co.

CLEC

Choice One CLECCoManage Turnkey SolutionComdisco Turnkey/FinanceCommunications ISP ISPConvergent Communications

CLEC

Cooperative Communications

CLEC

CoServ Communications CLEC/MSOCovad CLECCox Communications MSODell Computers OEM’sDenver Online ISPDevelopOnline MSODSL.Net CLECE Link MSOEarth Link Inc. ISPEspire CLECGCI CLECGenuity CLECGlobal Metro Networks MSOHickory Tech CLECHuxley Cooperative MSOIntermedia CLECIonex Telecommunications CLECLightstripTelecom CLECMaxcess CLECMcLeod Communications CLECMid Continent Cable MSOMpower Communications CLECNarad Networks MSONAS-Corp CLECNational Access Solutions CLECNew Express ISPNetsurfer Inc. Turnkey/Alliance

Network Access Solutions CLECNetworks Inc. ISPNew Edge Networks CLECNew Path CLECNew South CLECNorigen Communications CLECNtelos CLECPacific Bell CLECPolaris Venture Cap. Finance/VCQwest LECRCN MSORhythms CLECRidgeRun Inc MSORio Mesa Utility Services MSORoadrunner ISPRoseville Telephone Co. CA CLECSBC CLECSommera ResellerSprint LECTelocity CLECTess Communications CLECTime Warner MSOUS Link CLECValue Links (Rhythms) CLECVectris CLECVerizon CLECWilliams Communications CLEC

VIII. National Account Profiles

Included in this section are brief overviews for each of the 16 top U.S. National Accounts. This section is

intended to provide insight into our sales volumes, top selling products, and depth of professional relationship

with key contacts at each account.

A. Distribution

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Account: Ingram Micro

Industry Segment: Distribution

Annual Revenue: $30.7 Billion

Headquarters: Santa Ana, CA

Main Phone: 800-456-8000

Internet: www.ingrammicro.com

Stock Symbol: IM

Locations: Ingram Micro operates in 36 countries and has seven

distribution centers located in Fullerton, CA; Carol Stream, IL;

export Sales in Miami, FL; Newark, CA; Carrollton, TX;

Jonestown, PA; Millington, TN; an assembly/integration center

in Memphis, TN; and a returns warehouse in Santa Ana, CA.

Business Description:

Ingram Micro Inc. is the largest global wholesale provider of technology solutions, products and services. Ingram

Micro’s global regions provide the distribution of technology products and services, marketing development and

supply chain management services to more than 175,000 technology solution providers and 1,700

manufacturers. The company is focused on maximizing shareowner value and achieving customer satisfaction

through innovation in the information technology supply chain. .

USR Annual Sales: $135,607,000

Top 3 Selling Sku’s:

1. 5686 32%

2. 5699A 16%

3. 5610A 12%

Professional Relationships

Name Title Length of Working Relationship

Jodi Honore Sr. VP of Networking Products 6 years

Lanay Cerilli Director Storage and Components Division 4 years

Chris Digma Sr. Product Manager 4 years

Nicole Boling Product Manager 1 year

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VIII. National Account Profiles

Account: Tech Data

Industry Segment: Distribution

Annual Revenue: $19.9 billion

Headquarters: 5350 Tech Data Drive, Tampa, FL

Main Phone: 727-539-7429

Internet: www.techdata.com

Stock Symbol: TECD

Locations: Miami, Fla. Suwannee, Ga. Swedesboro, N.J. Fort Worth, Texas Fontana, Calif. South Bend, Ind.

Business Description:

Tech Data Corporation (NASDAQ/NMS: TECD), founded in 1974, is a leading global provider of IT products,

logistics management and other value-added services. The Fortune 500 Company and its subsidiaries serve

more than 100,000 technology resellers in the United States, Canada, the Caribbean, Latin America, Europe

and the Middle East. Tech Data's extensive service offering includes pre- and post-sale training and technical

support, financing options, configuration and assembly services as well as a full range of award-winning

electronic commerce solutions. The company generated sales of $19.9 billion for the past four quarters reported,

which ended October 31, 2000.

USR Annual Sales: $67M (June 2000 – January 2001)

Top 3 Selling Sku’s:

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1. 5686 31%

2. 5699A 19%

3. 5610A 10%

Professional Relationships

Name Title Length of Working Relationship

Tim Curran Sr. VP Sales 13 Years

Elio Levy Sr. VP Marketing 3 Years

Dan O’Brien VP Marketing Peripherals 17 Years

Roy Appelbaum VP Marketing Networking 1 Year

Wendy Rausch Director Marketing Peripherals 3 Years

Monte White Director Marketing Peripherals 1 Year

Tim Orselli Manager of Strategic Sales 6 Years

Sean Haggerty Marketing Manager Software 8 Years

Barbara Heck Sr. Product Manager 4 Years

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VIII. National Account Profiles

Account: D&H

Industry Segment: Distribution

Annual Revenue: $700M

Headquarters: Harrisburg, PA

Main Phone: 800-877-1200

Internet: www.dandh.com

Stock Symbol: Privately Held Company

Locations: 7 with 6 Warehouses located in Harrisburg,PA; Randolph, MA;

Ft. Lauderdale, FL; Chicago, IL; Visalia, CA; Dallas, TX

Business Description:

A full line, multi-divisional national distributor. D&H's divisions include the Computer Products Division, Home

Entertainment Division, Educational Division, Security Products Division, Government Services Division and an

eD&H eCommerce Division.

USR Annual Sales: $350K YTD ‘01

Top 3 Selling Sku’s:

1. 3CP5699A 30%

2. 5686 28%

3. 5610A 23%

Professional Relationships

Name Title Length of Working Relationship

Izzy Schwab CEO 14 Years

Gary Brothers President 14 years

Jeff Davis VP Sales 14 Years

Tina Fisher Product Manager 9 Years

Jennifer Tarbet Assistant Buyer 6 months

Last Revision 3/5/01 Page 48

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VIII. National Account Profiles

Account: Gates/Arrow

Industry Segment: Distribution

Annual Revenue: $2.1B

Headquarters: Greenville, SC

Main Phone: 800-332-2222

Internet: www.gatesarrow.com

Stock Symbol: ARW

Locations: Memphis, TN (Main Warehouse)

Dayton, NJ

Sparks, NV

Business Description:

Gates/Arrow, a division of Arrow Electronics, Inc., is a full-line technical distributor of computer systems,

peripherals, and software to value-added resellers in North America. They offer product availability across the

widest range of computing platforms, from desktop systems to enterprise computing environments.

Last Revision 3/5/01 Page 49

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USR Annual Sales: $4M ( Fiscal 2000)

Top 3 Selling Sku’s:

1. 5686 60%

2. 2806 22%

3. 3453 7 %

Professional Relationships

Name Title Length of Working Relationship

Dave Casella Sr. VP Marketing 2 Years

Mimi Anderson VP marketing 3 years

Jon Berry Sr. Product manager 7 Years

Dena Mensch Business Manager New

Arrow NACP (North American Computer Products) has several companies we can address through our

relationship with Gates/Arrow. They are as follows:

a.) Wyle Electronics

b.) Gates

c.) Consan

d.) Support Net

e.) SBM

f.) Mocha

VIII. National Account Profiles

Last Revision 3/5/01 Page 50

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Account: SYNNEX Information Technologies

Industry Segment: Distribution and Contract Manufacturing

Annual Revenue: $4 Billion

Headquarters: Fremont, CA

Main Phone: (800) 756-9888

Internet: www.synnex.com

Stock Symbol: Private

Locations: US Sales- Fremont and Greenville. Warehouses in Chicago,

NJ, Fremont and Memphis

Business Description:

SYNNEX Information Technologies, Inc., founded in 1980, is an information technology (IT) design-to-

distribution services company which provides a comprehensive range of offerings to original equipment

manufacturers (OEMs) and value-added resellers (VARs). Design-to-distribution services include design,

engineering and manufacturing services, IT distribution, marketing, logistics and customer support services, and

information technology support services.

USR Annual Sales: $5.2MM

Top 3 Selling Sku’s (in Units):

1. 5686 50%

2. 5610A 26%

3. 5699A 11%

Professional Relationships

Name Title Length of Working Relationship

Peter Larocque Sr. VP Sales of Product Management 3 mos.

Wayne Kendrick VP of Emerging Technologies 6 mos.

Ron Sakurai Sr. Product Manager- Networking 6 mos.

Jeanna Chambers Sr. Marketing Manager 6 mos.

Maria Magtalas Product Manager 6 mos.

Suzanne Lipscomb Marketing Manager 6 mos.

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VIII. National Account Profiles

B. Retail

Account: Best Buy

Industry Segment: Retail

Annual Revenue: $10.2B

Headquarters: Eden Prairie, MN

Main Phone: 952-947-2000

Internet: www.bestbuy.com

Stock Symbol: BBY

Locations: 473

Business Description:

The largest volume specialty retailer of consumer electronics, personal computers, entertainment software and

appliances.

USR Annual Sales: $19M

Top 3 Selling Sku’s:

1. 5699A 50%

2. 5686 35%

Last Revision 3/5/01 Page 52

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3. 5610A 15%

Professional Relationships

Name Title Length of Working Relationship

Wayne Inouwye Sr. VP Computer Merchandising 10 Years

Bob Davidson Sr. Merchandising Manager - Computer 7 Years

Arnel deJesus Merchandise Manager - bestbuy.com 7 Years

John Maskel Merchandise Manager - Musicland 5 Years

Scott Herkelman Senior Buyer 1 Year

Brian Cherchenko Buyer 2 Years

VIII. National Account Profiles

Account: Circuit City

Industry Segment: Office Superstore

Annual Revenue: $12.6 Billion

Headquarters: 9950 Mayland Dr, Richmond, VA 23233-1463

Main Phone: 804-527-4000

Internet: www.circuitcity.com

Stock Symbol: CC

Last Revision 3/5/01 Page 53

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Locations: 590 Superstores

Business Description:

Circuit City is a leading national retailer of brand-name consumer electronics, personal computers and

entertainment software. On January 5, 2001, Circuit City operated 590 Superstores and 39 Circuit City Express

mall stores in more than 155 markets. The Circuit City Group also includes a retained interest in the equity value

of the CarMax Group.

USR Annual Sales: New Account – opening order of $2.8M, March 2001.

Top 3 Selling Sku’s:

N/A

Professional Relationships

Name Title Length of Working Relationship

Mike Ryan VP Merchandising 8 Years

Andy Shivak Sr. Buyer 3 Years

Last Revision 3/5/01 Page 54

Americas Sales Business Plan

VIII. National Account Profiles

Account: CompUSA

Industry Segment: Retail

Annual Revenue: Privately held

Headquarters: Dallas, TX

Main Phone: 972-982-4000

Internet: www.compusa.com

Stock Symbol: Privately held

Locations: 218

Business Description:

Nation’s leading retailer and reseller of personal computer related products and services. These Superstores

serve retail, corporate, government, and education customers, and include technical service departments.

USR Annual Sales: $24M

Top 3 Selling Sku’s:

1. 5686 35%

2. 5699A 45%

3. 5610A 20%

Professional Relationships

Name Title Length of Working Relationship

John Lostroscio Sr. VP 10 Years

Ross Garner Sr. Buyer 10 years

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VIII. National Account Profiles

Account: Micro Center

Industry Segment: Retail

Annual Revenue: Privately Held

Headquarters: Hilliard, OH

Main Phone: 614-850-3000

Internet: www.microcenter.com

Stock Symbol: Privately Held

Locations: 18

Business Description:

Last Revision 3/5/01 Page 56

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Micro Center began in 1979 and has steadily grown into one of the largest computer retail companies in the

United States. They are known as “The Computer Department Store” with a highly trained sales staff, superior

customer service and technical support personnel.

USR Annual Sales: $3,000,000

Top 3 Selling Sku’s:

1. 5686 40%

2. 5610A 30%

3. 5699A 15%

Professional Relationships

Name Title Length of Working Relationship

Kevin Jones Merchandise Manager 1 Year

Jack McPeek Merchandise Manager 1 Year

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VIII. National Account Profiles

Account: Office Depot

Industry Segment: Office Superstore

Annual Revenue: $11.6 Billion

Headquarters: 2200 Old Germantown Road, Delray Beach, FL 33445

Main Phone: 800-937-3600

Internet: www.officedepot.com

Stock Symbol: ODP

Locations: 1,020 Office Depot stores operating in 9 countries

Business Description:

Office Depot, Inc., founded in 1986, is the world’s largest seller of office products and an industry leader in every

distribution channel, including stores, direct mail, contract delivery, the Internet and business-to-business

electronic commerce.

USR Annual Sales: $10.1M

Top 3 Selling Sku’s:

1. 5686 48%

2. 3056 29%

3. 3CP5699A 10%

Professional Relationships

Name Title Length of Working Relationship

Jeff Haymen Marketing Manager 7 Years

Bryan O’Connell Divisional Merchandise Manager 3 Months

Shawn Erdek Buyer 3 Months

Last Revision 3/5/01 Page 58

Americas Sales Business Plan

VIII. National Account Profiles

Account: Sam’s Club

Industry Segment: Retail-Mass Merchant

Annual Revenue: See Wal-Mart

Headquarters: Bentonville, AR

Main Phone: 501-277-7630

Internet: www.samsclub.com

Stock Symbol: See Wal-Mart

Locations: 480

Business Description:

Sam’s Club is the nation’s leading members-only warehouse. They offer 39 million menbers exceptional value

on name-brand merchandise at “members only” prices for both business and personal use.

Last Revision 3/5/01 Page 59

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USR Annual Sales: New Account – Opening order $1M, March 2001

Top 3 Selling Sku’s:

1. NEW – 5699A

Professional Relationships

Name Title Length of Working Relationship

Robby Lopez Buyer 5 Years

John Cowgur Assistant Buyer 5 Years

VIII. National Account Profiles

Last Revision 3/5/01 Page 60

Americas Sales Business Plan

Account: Staples

Industry Segment: Office Superstore

Annual Revenue: $9 Billion

Headquarters: 500 Staples Drive, Framingham, MA 01702

Main Phone: 508-253-5000

Internet: www.staples.com

Stock Symbol: SPLS

Locations: 1,100 Office Superstores across US

Business Description:

Staples Inc. is a $9 billion retailer of office supplies, furniture and technology to consumers and businesses from

home-based businesses to Fortune 500 companies in the United States, Canada, the United Kingdom,

Germany, the Netherlands and Portugal.

USR Annual Sales: $9.4M

Top 3 Selling Sku’s:

1. 5686 43%

2. 5687 30%

3. 3CP5699A 13%

Professional Relationships

Name Title Length of Working Relationship

Philo Pappas Sr. VP Merchandising 7 Years

Peter Scala VP Merchandising 7 Years

Bruce Bressler Director of Merchandising 3 Months

Gaurav Bahl Product Manager - Merchandising 7 Years

Susan Townsend Product Manager 3 Months

Last Revision 3/5/01 Page 61

Americas Sales Business Plan

VIII. National Account Profiles

Account: Wal-Mart

Industry Segment: Retail

Annual Revenue: ($M) 191,329.00

Headquarters: Bentonville, AR

Main Phone: 501-273-4000

Internet: www.wal-mart.com

Stock Symbol: WMT

Locations: 2700

Business Description:

Operates numerous discount stores and Supercenters throughout the United States and several other markets

world-wide. Principally engaged in mass-merchandising, offering customers discounted goods and services

through innovative marketing strategies.

USR Annual Sales: New Account – Launching March 2001

Top 3 Selling Sku’s:

1. 5699A

2. 5686D

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3. 5610A

Professional Relationships

Name Title Length of Working Relationship

Alan Henry Sr. Marketing Manager 6 Years

John Kooy Sr. Buyer 1 Year

VIII. National Account Profiles

C. Direct Mail

Account: CDW

Industry Segment: Direct Solutions Provider

Annual Revenue: $3.8 Billion

Last Revision 3/5/01 Page 63

Americas Sales Business Plan

Headquarters: Vernon Hills, IL

Main Phone: 800-830-4239

Internet: www.cdw.com

Stock Symbol: CDWC

Locations: 1 Warehouse located Vernon Hills, IL along with headquarters.

Sales locations: Chicago, Buffalo Grove, Lincolnshire, &

Vernon Hills, IL. CDW Government, Inc. (CDW-G), subsidiary

of CDW, has 2 locations: Chantilly, VA (outside reps) and

Lincolnshire, IL (inside reps). June 2001, they will combine

Vernon Hills, Buffalo Grove, & Lincolnshire to a new location –

Metawa, IL.

2 Retail showrooms: Vernon Hills and Chicago, IL.

Business Description:

CDW is the country's leading direct solutions provider, offering complete, customized computing solutions for

businesses and consumers nationwide. With competitive prices on a selection of thousands of computer

products, CDW is the No. 1 authorized direct source of many top name brands. Their direct model specializes

in serving small and medium-sized businesses. Offering one-on-one relationships with highly trained,

knowledgeable account managers

USR Annual Sales: $20M

Top 3 Selling Sku’s:

In 2001:

1. 5686 36%

2. 5610A 12%

3. 3CXM756 8%

Professional Relationships

Name Title Length of Working Relationship

Michael Krasny Chairman & Director 9 Years

Greg Zeman Vice-Chairman & Director 9 Years

Paul Kozak Sr. VP of Purchasing 9 Years

Dan Kass Sr. VP of Sales 7 Years

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Joe Kramer VP of Marketing 3 Years

VIII. National Account Profiles

Account: Insight

Industry Segment: Direct Marketing

Annual Revenue: $2.04 Billion

Headquarters: Tempe, AZ

Main Phone: 800-INSIGHT

Internet: www.insight.com

Stock Symbol: NSIT

Locations: US Sales- Tempe and Montreal. Offices in the U.K. and

Germany. 1 Warehouse in Indianapolis

Business Description:

Insight Direct Worldwide, Inc. is a leading global direct marketer of computers, hardware and software, offering a

broad line of more than 110,000 brand name products primarily to businesses in the United States, Canada, the

United Kingdom and Germany. Insight sells products via the Internet and by a staff of customer-dedicated

account executives utilizing proactive outbound telephone-based sales, electronic commerce and electronic

marketing.

USR Annual Sales: $6.76MM

Top 3 Selling Sku’s (in Units):

1. 5686 48%

2. 5610A 13%

3. 5699A 10%

Last Revision 3/5/01 Page 65

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Professional Relationships

Name Title Length of Working Relationship

Tim Crown Chairman 7 Years

Mike Gumbert President and COO, Insight Worldwide 7 Years

Rob Brinkman Sr. VP 7 Years

Brian Hicks VP of Product Management 2 Years

Scott DeTota Director Product Management – CPU’s 5 Years

VIII. National Account Profiles

Account: MicroWarehouse

Industry Segment: Mail-Order

Annual Revenue: $2.8 Billion

Headquarters: Norwalk, CT

Main Phone: 800-9273468

Internet: www.warehouse.com

Stock Symbol: Privately-Held Company

Locations: 3 US Locations (Norwalk, CT; Lakewood, NJ; Gibbsboro, NJ)

Last Revision 3/5/01 Page 66

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With 1 Warehouse (Columbus, OH) and 6 International

Locations (UK, Canada, France, Germany, Sweeden, and the

Netherlands)

Business Description:

MicroWarehouse, Inc. is a multi-billion dollar specialty catalog and online retailer and direct marketer of brand

name personal computers, computer software, accessories, peripheral and networking products to commercial,

education, government, and consumer customers.

USR Annual Sales: $6.2 Million

Top 3 Selling Sku’s:

1. 5686 40%

2. 5610A 15%

3. 5689 10%

Professional Relationships

Name Title Length of Working Relationship

Jeff Gentile Sr. VP of Merchandising 5 Years

Greg Stinsa Vice President of Outbound Sales 7 Years

Peter Scharfglass Vice President of Sales; E-Business 4 Years

Justin Carmichael Director, Advertising 2 Years

Chris Roth Senior, Merchandising Manager 3 ½ Years

Mary Jo Powlishen Senior, Modem Buyer 6 Years

Rick Vertula Product Marketing Manager 1 ½ Years

Last Revision 3/5/01 Page 67

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VIII. National Account Profiles

Account: PC Connection

Industry Segment: Mail-Order

Annual Revenue: $1.6 Billion

Headquarters: Merrimack, NH

Main Phone: 603-423-2163

Internet: www.pcconnection.com

Stock Symbol: PCCC

Locations: 4 Locations (Merrimack, NH; Marlboro, MA; Dover, NH;

and Keene, NH) with 1 Warehouse in Columbus, OH

Business Description:

PC Connection, Inc., through its subsidiaries, is a leading direct marketer of business computing solutions to

small and medium-sized businesses, educational and government institutions, and individual consumers

USR Annual Sales: $3.7 Million (Year 2000)

Top 3 Selling Sku’s:

1. 5686 31%

2. 5699A 15%

3. 5610A 12%

Professional Relationships

Name Title Length of Working Relationship

Wayne Wilson President 7 Years

Bob Wilkins Executive Vice President 7 Years

Larry Laine Director of Networking 1 ½ Years

Peter Szydlik Product Marketing Manager 1 Year

Last Revision 3/5/01 Page 68

Americas Sales Business Plan

Kevin Treat Product Line Manager 7 Years

Bridget Ballou Buyer 5 Years

Last Revision 3/5/01 Page 69