By Colin Boylan and Jonathan Noel, VI Form

Macroeconomics: “Easy Key” Product for Campus Safety and Convenience

Editor’s Note: As a final project in Macroeconomics, students had to find an issue within St. Mark’s and the world and then find the solution to it by “creating” a product. They had to find the costs associated with making the startup business, pitch the idea to Mr. Rob Calagione, and ask the venture capitalist for money in exchange for royalty.

On American educational campuses and specifically the St. Mark’s campus, campus safety and individual convenience are issues. All campus buildings are now being locked for safety reasons, but unfortunately, this is leaving students and faculty locked out of the buildings as well. Yes, key cards are a solution. However key cards are easily forgotten or lost, are likely to be broken, and are simply outdated. Our product, Easy Key, addresses both issues by providing students with a convenient way to access locked buildings in addition to allowing students to pay for school products.

Easy key is centered around a mobile application, that becomes an electronic substitute for Key cards for prep schools, colleges, and in St. Mark’s case the Lions Card. The App can be downloaded from Apple and Android products. Each student and faculty member would be given an individual code and signal for each phone. The school’s (St. Mark’s) tech coordinators will then connect the code of each student/faculty member’s phone to specific databases. Not only can the card allow community members to enter buildings through RFID (radio frequency identification), but it can also be used as a mobile school debit card. Although there are companies that work with hotel services, there are no companies that compare to our service to educational campuses.

America has become modern, and it is time that physical key cards are substituted for electronic key cards. An electronic key card via mobile app is more convenient for students and faculty members in comparison to physical key cards. There are many statistics that would support the usefulness of our product. For example, according to Tile Inc., about 19% of students lose their ID cards every year, and the average cost replacing a card is $22^[1].Moreover, in a study done by the Pew Research Center they concluded nine-in-ten cell phone owners (90%) say they “frequently” carry their phone with them, while just 3% say they only “rarely” have their cell phones with them and 1% of cell phone owners say they “never” have their phone with them.^[2]With statistical knowledge and the assumption that it is a partial necessity to have a smartphone at St. Mark’s due to constant mobile updates, we can educationally infer that this app will be more accessible and will provide more convenience to students and faculty in comparison to key cards.

Fixed Costs

As a start-up business, our goal is to turn as much of our revenue into profit. With this goal, Easy Key’s headquarters will be located in Colin’s parents’ basement to keep costs low. The price to stay in the building of our headquarters would be about $100 a month for “rental space.” Our company will incur a few fixed assets; this includes 2 used 2015 Toyota Corolla LE’s $8,000 each ($16,000),^[3] 3 pre-owned Apple 15” laptops one for Jon and Colin and one for our computer scientists $450 each ($1,350).^[4]Colin’s parents have a printer to print any necessary documents, and Colin’s parents also have WIFI for everyone to work. In order to successfully trademark our company, we will need atrademark lawyer which costs $1,500.^[5]In order to protect our property and prevent injury costs, we will have General Insurance which is $741 a year.^[6]  In total, our fixed costs are $19,691.

Variable Costs

Our variable costs start with the cost of labor; we will hire a computer science major for $1,200 a month. They will receive a 10% bonus every time we close a deal with an institution. We must also pay for a Monthly Website Maintenance Package which is $449 a month^[7]in order to maintain a professional website. Additionally, we need to pay to adjust the Radio Frequency Identification (RFID) in the cell phones. The cost will be dependant on our research outcomes and its compatibility card school card readers. We would dedicate $100 monthly to the research, in hope for improvements and technological advancement. We would also use $200 a month on advertisement via Facebook and mailing to schools. In an effort to sell our product to institutions, at an affordable and gain as much profit as possible from revenue, we will start by traveling to only New England campuses. Since I am no more than 200 miles from any New England location and gas currently costs $2.69 a gallon^[8], and our cars have 32 miles per gallon^[9]one trip would cost $33.62. We hope to travel twice a week costing us 3,496.48 a year. The total variable costs will change depending on how large our company grows. As of right now, these costs will be $2268.96 per month and 27,496.48 a year.

Break Even Point

We will charge schools on a per capita basis in which it will cost them $12 per student in the system every year they buy the service. Therefore, to cover all the costs in a year, we would need the institutions to pay us for a total of 2,291 students to cover our variable costs. We would need another 1,641 students to cover the fixed costs. This total can be paid by one large institution or many small ones. Schools similar to St. Mark’s, Universities and tech-savvy jobs are all in our market for the Easy Key.

Our product, Easy Key, will provide more convenience to students and faculty while still having doors locked around campus. It is time to replace cards with electronics, and the Easy Key is the solution.

The Ask

We are asking for $100,000 in return for 20% royalty on all profits until we pay back $200,000. We will use this money for google advertisement, transportation costs, and mobile application updates.

Bibliography

 “How Much Does General Liability Insurance Cost?” Insureon. Accessed May 08, 2018. https://www.insureon.com/insureonu/costs/general-liability.

 “Pre-Owned Apple MacBook Pro 15″ I5 [2.4] [320GB] [4GB] MC371LL/A(2010),” Walmart.com, , accessed May 08, 2018,https://www.walmart.com/ip/Pre-Owned-Apple-MacBook-Pro-15-

Rainie, L., & Zickuhr, K. (2015, August 26). Chapter 1: Always on Connectivity. Retrieved April 19, 2018, from http://www.pewinternet.org/2015/08/26/chapter-1-always-on-connectivity/

“Speedway.” GasBuddy: For the Perfect Pit Stop. Accessed May 08, 2018. https://www.gasbuddy.com/station/71377.

 The Cost of Lost College ID Cards -. (n.d.). Retrieved April 19, 2018, from https://www.thetileapp.com/en-us/blog/the-cost-of-lost-college-id-card

“Trademark Lawyer Cost: Everything You Need To Know,” UpCounsel, , accessed May 08, 2018,https://www.upcounsel.com/trademark-lawyer-cost.

 “Used Toyota Corolla For Sale.” CarGurus. Accessed May 08, 2018.https://www.cargurus.com/Cars/l-Used-Toyota-Corolla-d295#listing=205826820.

 Website Maintenance.” What Is an Infographic? | The Definition of an Infographic. Accessed May 08, 2018.https://www.webpagefx.com/websitemaintenance.htm.

^[1]The Cost of Lost College ID Cards -. (n.d.). Retrieved April 19, 2018, from https://www.thetileapp.com/en-us/blog/the-cost-of-lost-college-id-card

^[2]Rainie, L., & Zickuhr, K. (2015, August 26). Chapter 1: Always on Connectivity. Retrieved April 19, 2018, from http://www.pewinternet.org/2015/08/26/chapter-1-always-on-connectivity/

^[3]“Used Toyota Corolla For Sale.” CarGurus. Accessed May 08, 2018. https://www.cargurus.com/Cars/l-Used-Toyota-Corolla-d295#listing=205826820.

^[4]“Pre-Owned Apple MacBook Pro 15″ I5 [2.4] [320GB] [4GB] MC371LL/A(2010),” Walmart.com, , accessed May 08, 2018,https://www.walmart.com/ip/Pre-Owned-Apple-MacBook-Pro-15-

^[5]“Trademark Lawyer Cost: Everything You Need To Know,” UpCounsel, , accessed May 08, 2018, https://www.upcounsel.com/trademark-lawyer-cost.

^[6]“How Much Does General Liability Insurance Cost?” Insureon. Accessed May 08, 2018. https://www.insureon.com/insureonu/costs/general-liability.

^[7]Website Maintenance.” What Is an Infographic? | The Definition of an Infographic. Accessed May 08, 2018. https://www.webpagefx.com/websitemaintenance.htm.

^[8]“Speedway.” GasBuddy: For the Perfect Pit Stop. Accessed May 08, 2018. https://www.gasbuddy.com/station/71377.

^[9]“Used Toyota Corolla For Sale.” CarGurus. Accessed May 08, 2018. https://www.cargurus.com/Cars/l-Used-Toyota-Corolla-d295#listing=205826820.