Goal Beach resort is designed as a world class five star hotel with the aim of redefining the hotel industry in Mauritius. Extensive market research reveals a market gap in the provision of hotel services for the aristocrats (football stars such as Didier Drogba, Wayne Rooney, and Ji Park Sung; top CEOs, executives and the world’s richest such as Steve Jobs, Larry Page, Jerry Yang Warren Buffet; actors like Angelina J, Will Smith and Megan Fox) in Northern Mauritius. In addition to these they are deprived of choice as most hotels are built with the same business models. Goal Beach Resort intends to capitalize on the 2010 FIFA World cup to be staged in South Africa later in the year, as the preferred resort for the nobles.
Facilities and services to be offered shall include 10 international status bungalows and villas, swimming pools, gyms, sauna, tennis courts, live music shows and entertainment. Meals will also be served daily with 24-hr security surveillance.
The proprietors are Dubai based investors (the Rene Db group) made up of seven United Arab Emirates nationals. Their long experience in business ideas identification and recruitment of personnel make them suitable to be directors of Goal Beach Resort. Abdul Saif, a retired executive of the group’s largest resort in Malaysia, has worked as the overall deputy director in the Datai, Malaysia (one of the best beach resorts in the world). He will serve as the director general owing to his previous experience. The wide investment base from Rene Db Group enables it to select an experienced management and other staff across the board to work in this new establishment.
Business objectives
Goal Beach Resort intends to capitalize on the 2010 FIFA World cup by providing hotel services to the high end class participants; this will also form its market afterwards. To achieve this, it will curve out a niche in the market as a Resort of choice in Mauritius and earn maximum returns. It also aims to provide consumers with an alternative of choice to make in picking a resort.
Vision and mission statement
The mission of the firm is to become the preferred resort in Mauritius for the high-end class of tourists, local delegations and individuals by offering superior unrivalled facilities, products and services. The firm will help set standards in the hotel industry and in turn, satisfy different customer tastes and preferences.
The hotel industry in Mauritius
Mauritius has become a large tourist destination owing to: its prime location, existence of a range of unique beaches and increased marketing by local agencies and authorities through online portals. In addition to these the use of tour operators as marketers has significantly strengthened the tourist industry. Previously, Mauritius used to be a French tourist destination. However, with marketing, tourists have been arriving from other destinations including England, Australia and South Africa. Other drivers of the growing popularity of this newly found holiday destination are, the friendly nature of the Mauritian people, the beautiful landscapes, the natural vegetation with over 700 species of native plants and the circumnavigation of the island by miles of coral reefs, with the beauty and elegance of nature at its purest form (MTPA tourism Office para 2).
Owing to this expansive tourist industry, Mauritius has experienced tremendous growth in the hotel industry. The existing hotels can depict the high demand for accommodations in the island. The industry has attracted both local and international investors. International investors can be seen by the presence of international hotel chains for example the Le Coco Beach Hotel of the Sun international Hotels. The hotel industry is structured to cater for different types of customers. The hotels range from simple bungalows to 6 star hotels. However market research in the Northern part of Mauritius revealed that customers are not offered with varieties to choose from, as most hotels have similar structures and offer the same services. Similarly, there is little or no focus on the top class of consumers. This gap has led to loss of income for the hotel industry and the Mauritian government where consumers have sourced for these services elsewhere, for example, the nearby South Africa.
With the upcoming FIFA World cup in mind, the consumers’ deprivation of choice and the existing market gap in provision of hotel services to the upper class, Goal Beach Resort will try to use this opportunity to grow. It will capitalize on these deficiencies and market problems to redefine the whole industry.
The core aspect to focus on in order to achieve success in this industry is the ability to establish operational advantages that are superior to the competitors. This will be attained through provision of world class services, marketing and innovation. Goal Beach Resort will take advantage of the investor friendly tax rules and environments in Mauritius.
There are highly favourable tax incentives with intentions of making foreigners to acquire property rights in Mauritius (According to MTPA tourism Office para 2). Some of the tax incentives include waivers of double taxation on foreigners. Similarly, Mauritius has experienced an annual growth rate of 5% over the last five years.
Market Analysis
Goal Beach Resort shall undertake a study on the market feasibility of the upper class oriented beach resort in Northern Mauritius. Market variables to be focused on in this research are the goods, services, facilities, consumers, competition, size of the market and its trends through primary and secondary research means.
Market size and trends
In view of the changing trends and market dynamics, the firm will undertake a study of these aspects with a bias on the 2010 FIFA World cup. It is expected that the number of tourists will multiply infinitely during the event to premier in Africa in June. Official reports from Mauritius tourism authorities, indicate that FIFA organs responsible for accommodation have been tasked with outsourcing 6,400 beds in Mauritius during the world cup period.
Required are high class accommodations owing to the high standards of life that football stars and tycoons live. This means that the 6,400 beds will be out of reach for ordinary customers. Accordingly MTPA tourism Office says that 20, 000 visitors are expected to source for accommodation in Mauritius. Goal Beach Resort expects to attract a considerable percentage of the total revenues expected from this arrangement. (MTPA Tourism para 3-5)
Goal Beach Resort also expects to curve out a niche from the world cup experience. In order to ascertain the demands and needs of the world cup community, primary research will be carried out through online surveys and interviews from potential and actual participants. Customers who will be accommodated during the sporting event will be indirect marketers and advertisers who will come through referrals and come-backs.
The ever busy tourism market, which is also expected to grow further, will provide an impetus of growth for Goal Beach Resort after successfully accommodating the world cup community.
Consumer market research
The impetus behind the idea of establishing Goal Beach Resort is satisfaction of the neglected consumer demands. The fact there is a high demand will guarantee success of the venture. However, it is important to redefine consumer demands for maximum results. This calls for market segmentation of the expected customer base, and a segment by segment analysis which needs to be carried out.
The first group here will be the aristocrats. This group is of great concern as its expected to form the future market for the resort. Its composed of ; world football stars: Wayne Rooney, Didier Drogba, Ji Park Sung; Top CEOs, executives and the world’s richest people: Steve Jobs, Larry Page, Jerry Yang, Warren Buffet; Actors: Angelina J, Will Smith and Megan Fox; Presidents, and high level diplomatic delegations. In order to fully understand the needs of this class, Beach Goal Resort will utilize the experiences and services of the Director General, Abdul Saif to develop the best suited goods, services and facilities. He will be in-charge of a panel which will evaluate their spending behaviors, patterns, inference their findings and make recommendations.
The second group of consumers will be the world cup fraternity. This is made up of football delegations composed of players, coaches and their technical benches, heads of state, and ultimately the spectators. Spectators will form the bulk of this group. This research will determine the consumption patterns and their decision making process through expert surveys in order to influence these patterns.
The goods, services and facilities Research
This resort is built to serve the needs of the nobles. It will be providing all facilities, goods and services provided expected of an international five star hotel. A research will be carried out to determine the changing attitudes, likes, tastes and preferences and emerging trends in the five-star hotel sector. The sector will need to come up with new innovative services and facilities which is necessary in satisfying the market. New innovations will ensure that the resort is unique as opposed to reproducing hotels models, similar to the present ones
Competitor analysis
In order to ensure that the resort is not driven out of business, a competitor analysis will be carried out prior to entry. The will involve a strength and weakness analysis of the hotel and that of its competitors (Forbes para 2-3)
Table 1.0
Financial Feasibility
Start up Costs
The initial costs required to set up Goal Beach Resort are listed in table 2.0 below:
Table 2.0
The total funds required are SR 39, 080, 000. The firm will be looking for loan that it will use to start the business. The loan will be repayable within 5 years at 8% p.a. But later on it will be converted into equity.
Operating Expenses
These are grouped into fixed costs that are independent of production and business status; variable costs dependent on scale of production. A detailed analysis is provided in the table 2.1 below:
Table 2.1
Firm’s projected cash flow analysis
In view of the 2010 FIFA world cup, and unsatisfied market demand the firm projects a positive favorable cash flow during the event. This world cup is expected lay a good foundation for future operations. The firm has projected a positive cash flow. A positive flow of profit is expected as a result of mass participation in this event.
However, earnings are expected to fluctuate in the period after the world cup but improve after the world cup fever is due and over. Online marketing coupled with on-the-ground ads in world cup venues is expected to boost sales from the first day on. Most of the internationally acceptable forms of money remittance will be utilized (FAO Corporate Document Repository n.d.)
Table 2.2 is a Goal Beach Resort cash flow
Goal Beach Resort Pro forma Income statement
Table 2.3
Table 2.4: Goal Beach Resort Pro- forma balance sheet analysis for year 1 SR
Loan repayment
As an upstart, partners will borrow a loan of SR 28 M which will be later converted into equity. The loan will attract an 8% p.a., simple interest. The business will operate as it repays the loan since from the forecasts business will continue improving year on. The earnings will be used to come up with more innovations and fund expansion.
Risk analysis
The underlying assumption behind all forecasts is that the 2010 FIFA world cup has the capacity to create supernormal changes in demand. Additionally, the proximity of Mauritius from the host nation South Africa , in addition to South Africa’s inability to accommodate all participants is another potential benefit for this venture. The aim is to capitalize on this demand to achieve our competitive advantage. Consequently, the risk of failure on start up is eliminated due to this certain spurt in demand. Major competitors are not readjusting any of their business strategies. This gives the firm a grace period to establish, before competitors re-brand. These will help to eliminate the barriers to entry. In addition, the government rules are investor friendly with no looming political or economic uncertainties. The business will likely rebound after the world cup as it heads to December. During the months from November to December business picks up as there is a lot of holidaying that takes place.
Works Cited
Constance Prince Maurice. Latest Special Offers. 2007. Web.
FAO Corporate Document Repository. Conducting a feasibility study, n.d. Web.
Forbes. Home Page for the World’s Business Leaders. 2006. Web.
MTPA Tourism Office. Discover Mauritius. 2010. Web.
Oberoi Hotels & Resorts. The Oberoi Mauritius overview. 2009. Web.