The Abu Dhabi Cycling Tour is a new sporting event that has been planned to take place from October 8 to 10, 2015 in the Capital city of Abu Dhabi. Organized by Abu Dhabi Sports Council, this event will be a unique one, meant to meet the needs of professionals and amateurs. It is scheduled to coincide with the international cycling day. The Abu Dhabi Sports Council had commissioned a research, and it was established that cycling was one of the most popular sports, especially among the tourists.
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The decision to organize this event was based on this research. The event was meant to not only meet the needs of the local sportsmen and women, but also to attract tourists to come and witness or even participate in this thrilling event. It is expected to be a day that will be full of pleasure. In organizing such a mega event that will be taking place for the first time in this country, there are unforeseen risks that the organizers must be well prepared for in order to make the day a success (Schwaighofer, 2014).
Issues such as accidents, fainting among the participants, and such related risks must be addressed in the best way possible to avoid any casualties. The region is also prone to terrorists’ attacks that have been witnessed in the global society. The organizers will have to be prepared for such eventualities. In this paper, the researcher will look at the strategic risk plan of this event and the financial implications that the event will have to the organizers.
When organizing such mega events as the newly created Abu Dhabi Cycling Tour, it is always prudent to look at the products to be offered, the market analysis, expected sales and revenue based on the past performance indicators, among other financial issues.
However, one should also remember to critically assess the issues about the possible risks that may affect the progress of such events. In order to attract the local and international community to get involved in such events, we must prove to them that we have issues of safety and security well taken care of at all times. The organizers will need to facilitate all the necessary apparatus that will ensure safety and security for everyone. However, it will also be important for the team to look at the business aspect of the event to avoid the possible losses that may be witnessed in case things fail to go as per the plan. In this section, it is reasonable to look at the products that will be offered, the market to be served, the expected financial returns based on what has been witnessed in other parts of the world, and the financial pitfalls that the organizers must be keen on controlling. This way, the team will know how to budget for the entire event.
Description of the Organization
The Abu Dhabi Cycling Tour was organized by the Abu Dhabi Sports Council. The Abu Dhabi Sports Council was founded following a decree by Sheikh Muhammad, the Abu Dhabi Crown Prince, to help the emirate enhance various sporting events for youths and other members of the society (Abed, 2014). Since its formation, this organization has been working with the relevant stakeholders to champion for various forms of sports within this emirate. The leadership of this country understands that sports are not just for leisure. They can also be a career for some youths. These events also help in boosting tourism in this emirate.
The Abu Dhabi Cycling Tour will be taking place for the first time in history in October this year. This event is expected to attract the local and international communities that will be coming for various reasons. For the locals, this will be a golden opportunity for them to try the professional cycling that will enable them compete in the international arena. There will be the international professional cyclists and this means that the local sportsmen and women in this country will have a lot to learn.
The locals also stand a chance of benefitting from the booming business that is expected due to the influx of people into the city. To the international community, this event will offer them a rare opportunity to participate in the competition while having a view of the beauty of the city of Abu Dhabi. It will not be an exclusive event for the professional cyclists. The amateurs will also be allowed to participate. They can take this as a leisure event as they take time to view the beautiful sceneries in the city. As an organization, the Abu Dhabi Sports Council will not only succeed in popularizing a new sporting event in the country, but it will also get the opportunity to market Abu Dhabi as an international tourist destination.
Product & Services
According to Oborn (2013), when looking at the financial aspects of a given event, such as the Abu Dhabi Cycling Tour, it will be important to look at the products that will be offered. Defining the products makes it easy to know how to modify it to meet the needs of different groups of customers. The first product that this event will offer is cycling. This will be categorized into two. There will be leisure cycling and professional cycling. The leisure cycling will be the first and the last to hit the road. The leisure cyclists who will want to complete their course first before witnessing how the professionals compete will have their way.
They will be taken to the road early enough to complete their courses before the professionals can start their race. Any damage on the course will be repaired before the professionals can start their race. Once the professionals are done, the leisure cyclists will once again be allowed back to the track. For the professional cyclists who will be coming to Abu Dhabi specifically to participate in this international event, their needs will be met. They will be given the opportunity to participate in this forum without the interference of the leisure cyclists. The second product, which is very important to the government of Abu Dhabi, is tourism. Many people are expected to come from various parts of the world to witness this event. They come to Abu Dhabi as tourists. The products offered to them will include beautiful sceneries, quality time at the beach, among other related products that they may desire.
The business community will not be left out during such events. Food is a major product that will be necessary in this forum. All the attendants, both the participants and spectators will need to eat. They will also need the boarding services. It means that the hospitality industry will boom when this event takes place. The transport sector will also reap from this event because their services will be needed. People will need to travel from one part of the emirate to the other. Some may want to use the unique transport system such as the special sea buses. This will be a source of income to those who are involved in offering the services. The tour guides will need to offer their services to the visitors who may need to visit various parts of the emirates.
According to Hamilton and Coyle (2012), when planning for such a mega event, it is always important to ensure that the organizers understand the nature of the market that will be served. The main aim of the organizers will be to ensure that the market needs are fully met in a way that will offer maximum satisfaction possible. The market analysis will, therefore, involve understanding the specific market categories and what they will be looking for when they visit this city. The first category that is very important to the organizers is the tourists. These are the middle or upper class members of their society coming from different parts of the world.
They are coming to Abu Dhabi to get comfort and leisure. The sports and sceneries they will visit will offer leisure. The hotels and transport systems they will use must offer comfort. Some of them, especially the rich, will be willing to pay extra costs to get an extra comfort and leisure. These services must be available for the organizers to ensure that their visitors get maximum satisfaction.
The professional cyclists form another important market segment. They may or may not be rich. Their main purpose of coming to the city is to participate in this international event. They need to have tracks that meet the international standards. They also need to have hospitality services for the three-day event. The local community is another important market segment that cannot be ignored. They will be joining the international visitors in these events either as participants or spectators. They need to be accommodated. All these market segments will need to have proper security systems during the entire process. They will need to feel secure. The organizers will need to find a way of meeting the special needs of the participants in each segment that has been mentioned above (Chia & Chiang, 2010).
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Sales & Revenue
This is the very first time that this event will be taking place in the city of Abu Dhabi. This means that the local organizers do not have the past records that can help them predict the sales and revenues expected from this event. However, they may rely on various parameters to determine the sales and revenues from this event. As Dauncey (2012) notes, this will start by identifying the products that are on offer. It has been identified that some of the products on offer include the tour services to various parts of the city, transport services, and hospitality services. These three are expected to be the major sources of income.
However, the ripple effect on other sectors of the economy cannot be ignored as well. For instance, some of the visitors may want to buy apparels or other products that will be a reminder of their visit to this great city. All these will be sources of revenue. In order to determine the sales, it will be necessary to estimate the expected population that will come to the city (Dempsey, 2014). This should include Emirati nationals who will be coming to Abu Dhabi to witness or participate in this event. As it is, it may not be easy to predict the specific number of guests expected at the function because it is a new event. However, the organizers will be able to determine the number in August or September this year by looking at the reservations at the hotels and the air tickets bookings for those planning to be part of the event.
It is only fair that the organizers spend an amount of money that they can recover once the event has come to an end. According to Fox (2010), a business entity that spends more than what its revenue offers is not sustainable. For the purpose of sustainability, it will be important to balance between the planned expenses and the expected revenues. Looking at the past financial statements is important at such stages. The pro-forma income statement and a balance sheet will be necessary at this stage.
Pro-forma Income Statement
The pro-forma income statement helps to determine the sources and amounts of income generated in the past events in order to help in predicting the future. The Abu Dhabi Sports Council will need this statement in order to identify the major sources of income and how structures can be put in place to enhance their maximum exploitation. It is unfortunate there is no existing history of this event. It makes it necessary to use the income statements of Monaco Cycling Tour shown in appendix 1.
The balance sheet also helps in determining the performance of the event. The Abu Dhabi Cycling Tour will be an entity with its own assets. The growth of the assets and income will be the indicators of a positive performance. As at now, the researcher will rely on the data of Monaco Cycling Tour to show what this firm should expect in the near future. The balance sheet is in Appendix 2.
The event will be expected to take place annually, from October this year. It would be interesting to have a comprehensive analysis of the manner in which the event has been organized for the past five years. However, this is a new event that is just taking place for the first time in history of this city. The tracks for the athletes have been prepared, and the routes clearly defined. The stakeholders who will be involved in various activities in the entire process have been identified, notified, and prepared for the event. From this year onwards, there will be clear information about this event.
This cycling event can only continue if it brings benefits. If the organizers realize that it is unsustainable because of the low income, insecurity it poses, safety issues that cannot be met, or any other valid reason, then the exit plan will be necessary. The plan will simply involve calling off the future events and announcing the same to all the participants.
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Dauncey, H. (2012). French cycling: A social and cultural history. Liverpool: Liverpool Univ. Press. Web.
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