A brief look at the market feasibility of an intended hotel
- Classification of tourists
- Tourism industry
- Promotional stratergy
- The 4 P's
- General features
- Assessment of working capital
- Project financing
- Means of financing
- Profitability statement
- Cash flow and debt servicing
As per the definition of MANZINKER and KRAFT of Beam University, tourism is the sum of the phenomenon and relationship rising from the travel and stay of a non-resident so far as they do not lead to permanent residence and are not connected to any earning activity. Tourism today is one of the world's fastest growing industries. The significant feature of the tourism industry is that it employees a large number of women educated, uneducated, skilled or unskilled.
Tourism has occupied a strategic position due to its contribution to economic growth and the need for development and maintenance of the tourism infrastructure. A responsive private sector is poised for a leap forward down the information upper highway because electronic traffic will surge through when frequent travelers clicking on their lap top computers would access airline, hotel, car rentals etc. The regional development of tourism is growing in importance along with the planted development of other economic resources and environmental protection.
An increasing amount of investment and promotional expenditure is denoted to extend the tourist season. As tourism is the major earner of local as well as foreign currency Tourism authority of any country gives much publicity to places of general as well as specific tourist interest.
[...] PROFITABILITY STATEMENT It is seen that at 75% occupancy level the hotel will be able to generate sales that can help sustain the hotel. The operational costs are calculated on the following basis Food cost 2. Salaries and wages 3. Power, fuel and water charges 4. Repairs and maintenance 5. Guest supplies, upkeep, and replenishment cost 6. Advertising and sales promoting costs 7. Rates, taxes and insurance 8. Administrative overheads which includes, printing & Stationary, Postage, and telegrams, Conveyance and Miscellaneous expenses Depreciation in most of the cases is calculated on straight line basis 55 on building on machineries and other assets Amortization of preliminary and pre operative expenses 11. [...]
[...] In the operational phase there is need for buying materials on a conditional basis and periodically make payments by way of salary to the people and bills from electric board, water supply and fuel etc. In order to make this payment store materials and extend credits to the hotel guests, the unit will have funds generated by sales. However it is seen that most of the times the sales realization are not sufficient to meet the various obligations. This gap requires to be filled up by additional funds known as the working capital. [...]