Investigating the market feasibility of a hotel

Shaharu B.

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Investigating the market feasibility of a hotel

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Abstract

Tourism is the act of travel for the purpose of recreation, and the provision of services for this act. A tourist is someone who travels at least eighty kilometers (fifty miles) from home for the purpose of recreation, as defined by the World Tourism Organization (a United Nations body). A more comprehensive definition would be that tourism is a service industry, comprising a number of tangible and intangible components. The tangible elements include transport systems - air, rail, road, water and now, space; hospitality services - accommodation, foods and beverages, tours, souvenirs; and related services such as banking, insurance and safety and security. The intangible elements include: rest and relaxation, culture, escape, adventure, and new and different experiences.

Many countries depend heavily upon travel expenditures by foreigners as a source of taxation and as a source of income for the enterprises that sell (export) services to these travelers. Consequently, the development of tourism is often a strategy employed either by a Non-governmental organization (NGO) or a governmental agency to promote a particular region for the purpose of increasing commerce through exporting goods and services to non-locals.

Introduction to hotel industry
History
Health tourism and leisure travel
International mass tourism
Recent developments
Trends and scope of the industry
History of hotel industry
1. From antiquity to the Middle Ages
2. The start of the hotel industry
Demand analysis
Demand quantification
1. Formulas and calculations
2. Demand evaluation
Technical details of the proposed project
1. Air conditioning unit
2. Powers
Recommended market mix
1. Definition of marketing mix
2. Profile of the proposed hotel
3. F and B outlets
4. Pricing
5. Promotion
6. Advertising
7. Publicity
8. Personal selling
Sales promotion
1. Physical evidence
2. Marketing tips to promote the proposed hotel
Introduction to financial aspects of the proposed project
1. Scope of finance
2. Finance function
3. Break even point
4. Estimating capital requirements for a new hotel
Term analysed
1. Fund flow statement
2. Working capital
3. Break even analysis
4. Land and machinery
5. Plant and machinery
Evaluation of a proposed investment
1. Profitability
2. Return on investment
3. Cash flow
Break even analysis
Conclusion

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[...] In Europe, or more precisely in Belgium, Auberge Cour Saint Georges opened in Gant, while the Angel Inn was built at Grantham in Lincolnshire, England. The start of the hotel industry In France, at the beginning of the fifteenth century, the law required that hotels keep a register. English law also introduced rules for inns at that time. At the same time, around 1500 thermal spas were developed at Carlsbad and Marienbad. During this epoch, more than 600 inns were registered in England. Their architecture often consisted of a paved interior court with access through an arched porch. [...]

[...] RECOMMENDED MARKET MIX DEFINITION OF MARKETING MIX Melvyn Greene defines that “marketing is basically seeking out a demand and then making the product or supplying the service to satisfy that demand. Selling is rather the other way round - creating a product or service and then trying to find a market for it. PROFILE OF THE PROPOSED HOTEL PLACE The location of the proposed hotel is decided while keeping in mind the high percentage of different types of clients in the city. [...]

[...] Estimating capital requirements for a new hotel Estimation of the amount of capital required is of utmost importance to develop a financial strategy for a proposed hotel; assets will require capital investment. Finance function includes: Investment or long-term assets mix decision Financing or capital mix decision Dividend or profit allocation decision liquidity or short-term asset. The mix decision. TERM ANALYSED Fund flow statement: The statement of changes in financial position, prepared to determine only the source and use of working capital between dates of true balance sheets are known as fund flow statement. [...]

[...] A firm creates manufacturing capacities for the production of goods, some provide to consumers their goods or service to earn profit. They raise funds to acquire manufacturing and other facilities; thus the three most important activities of a business firm are finance, production and marketing. A firm secures whatever capital it needs and employs it [finance activity] in activities. FINANCE FUNCTION Although it may be difficult to separate it, the finance function themselves can be readily identified with the function of raising funds, investing them in assets and distributing return earned from assets to share holders, which are respectively known as financing, investment, and divided decision. [...]

[...] Britain was the first European country to industrialize, and the industrial society was the first society to offer time for leisure to a growing number of people. Initially, this did not apply to the working masses, but rather to the owners of the machinery of production, the economic oligarchy, the factory owners, and the traders. These comprised the new middle class. International mass tourism Increasing speed on railways meant that the tourist industry could develop internationally. By 1901, the number of people crossing the English Channel from England to France or Belgium had passed 0.5 million per year. [...]

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