Axis Tour and Restaurant Agency - Technical Feasibility - Case Study Example

Technical Feasibility Name Tutor: Subject: Date: Introduction Axis Tour and Restaurant Agency is a new tourism firm, formed as a sole proprietorship. The owner has an intense interest and has resorted to undertake the operation's report in the tourism industry. He delights in meeting people and sharing experiences. This synergy and passion for tourism builds the basis for establishing this creative service industry. This venture being a service industry intends to specialize in three lines of businesses namely; tours and travel, restaurant and accommodation. The goal is to serve all the tour clients’ needs for each company we work with and be a one-stop-shop. While the services will be, product quality, and prices will be excellent, the marketing strategy focuses on building long-term relationships with our customers (Apostolopoulos et al, 2013). By focusing on its commitment to helping clients and tourism sector obtain the tour products and services they need, the agency will increase its sales to projected levels while improving the gross margin. It will distinguish itself by reinforcing reliability and expertise with competitive pricing and services that suits clients’ needs. Company Ownership and location Axis Tour and Restaurant Agency is a start-up owned sole-proprietorship ventures. Tourism firm that deals with tour, accommodation and restaurant services. Incorporation will be explored as a later option. The company will be strategically located at the outskirts of the capital, which is serene for tour clients. This location gives the advantage over the busy streets of a major city. Travel agents will also gain the advantage in accessing and delivering real time services to both individual clients and corporate clients (Beltramello et al, 2013). The company will also be located near the city’s national airport; will act as a major hub for regional and international clients. In partnership with travel agents, the company intends to establish strong ties with government agencies like, tourism Ministry. This strategy will help build strong corporate relationship with statutory partners and offer a competitive advantage. Start-up summary and maintenance Our initial start-up costs will amount to approximately US $485, 500 to finance leasing requirements. Of which, US $450, 000 will be used to purchase office equipment and up-front property costs until credit is established with clients. Additionally, we project the need for a financial commitment of another US $200, 000 to finance receivables and payroll expenses for the first 12 months of operation. The facility will be regularly maintained by a resident engineer. This will include, among other services, maintenance of gardens, interior design, physical renovations and environmental approvals. Government environmental agencies require regular assessment of structural facilities. This task dedicated to the expert will relieve the management the burden of overseeing tasks which they might not be familiar with. The company will use the competitive contract award system to furnish the leased business premise. All supplies to be used in service and production will also be procured in the structured procurement policies. This will save the company the damage of corruption and substandard supplies. Such supplies can compromise quality of food and other related services (Chesbrough, 2013).  Start-up list and Costs Item description Amount US $ Legal 2,000 Meet & Greet 6,000 Business Plan 4,000 Logo Design 1,500 Stationery 9,000 Insurance 4,000 Business Cards/Brochures/Website/Social Media 4,500 Initial Mailing/Marketing 1,000 Process Funding 5,000 Office Equipment 450,500 Total Start-up Expenses 487,500 Start-up Lease Assets Cash Required 487,500 Other Current Assets Kshs.0 Long-term Assets Kshs.0 Total Assets 487,500 Total Requirements US $.487,500 Products and Services Axis Tour and Restaurant Agency provide tour and travel services, world class restaurant services and accommodation services. The focus is on providing the broadest possible types of tour industry services. Product and Service Description The agency is a tourism industry venture that provides a wide range of services and related products. The added value of Axis Tour and Restaurant Agency is its knowledge and expertise. Clients’ needs, for example, individual and corporate, are evaluated and assessed; ideas and solutions are offered to each client to meet their specific needs (Douglas, 2014). Most ventures require a number of varied print media and another form of communication in order to operate, market, and communicate efficiently on a daily basis. We shall also incorporate transport agencies, tour operators and corporate planners enhance the synergy and teamwork required in the industry. The agency, greatly considers becoming and joining the membership of the productive sector. This is a key element in marketing strategy. Market trends In coping with market trends, the company will use modern sales strategies to reach the intended market. Print and online advertising, brochures, media releases, and using tourism associations and sector platforms, are the key avenues the agency will use to put it at the edge. Use of social media, internet marketing is currently trending in modern business; especially tourism and hospitality industry. The company will specifically use online and corporate platforms. Competitive Comparison The tourism industry is competitive. To differentiate itself from its competitors, the agency intends to be reliable and informative ally to our clients. Most tourism companies can only afford a small variety of services; therefore can only offer a limited type. The goal is to maintain close contact with several product manufacturers, leisure travel agencies (individual and group travelers), and corporate market in order to offer the best services on one-stop to local, national and international markets. Technology and inventory management The agency will use QuickBooks Pro™ software for accounting, purchasing, taxes, estimating, and invoicing. Act 2000™ is sales based software that keeps track and effectively manage client accounts. Talk works Pro™, is a communication software that enables voice mail, fax machine, and message notification services, keep close contact with clients and vendors. The inventory management system will also be procured to handle tendering and procurement processes. These previously mentioned software programs integrate with each other so to minimize redundancy (Titus, 2013). Operations Objectives The objectives are to make Sell US $.550, 000 in the first year. To increase sales to more than US $.1.5 million by the third year. To grow and maintain gross margin at 30%. The Mission of Axis Tour and Restaurant Agency intends to offer client based services and satisfaction. Providing one-stop-shop services at reasonable cost is key. The agency makes number one goal that clients receive a quality services with maximum efficiency and reliability by providing fast response and timely attention. Axis Tour and Restaurant Agency key focus is to generate satisfied repeat clients. Key strategies for managing seasonal variations The company will use market segmentation as a strategy to reach the leisure and corporate clients. The market segmentation strategy intends to allow room for possible expectations and make definite projections. Tourism sector and travel agents partnership offers a wider market network which is vital in realizing sizeable customer base. The target markets will be leisure and corporate companies that utilize diverse tourism packages. This group is essential because the marketing and customer service departments are generally research oriented and follow client satisfaction. The focal point of the marketing strategy will be face-to-face contact with individual and cooperate clients. Driving forces The primary driving force pattern in the tourism business is getting value for money. The demand for services and products is developed from a desire to spend and have pleasure. The populace considers availability of income and desire to travel driving factors to utilize services provided by tourism businesses. These services are not limited to accommodation, food and drinks and tour travel services. The geographical features give an advantage in local, regional and international clients. Competitive advantage Quality service, good reputation, and timely client’s satisfaction affect the ultimate choice by a client to take a service. The already exploited tourism market makes it even more competitive. This field is dominated by individuals and corporate owned tour companies that can turn around the work quickly when proper marketing strategies yields the desired objectives. In order to reach its goal of becoming a successful tour company, Axis Tour and Restaurant Agency will adopt the following strategy: 1. Emphasize expertise, professionalism, and reliability. 2. Build a long-term relationship-oriented business. 3. Provide solutions, service, and quality tour services to clients. To differentiate with the worthy competitors, marketing efforts will focus on getting satisfied clients and continues fulfillment of promises. Sales strategy for Axis Tour and Restaurant Agency is a simple client satisfaction which will provide referrals to new clients. Management and personnel summary The initial management team depends on professionally recruited personnel. Our management philosophy is based on responsibility and mutual respect. The founders themselves will handle supervisory and consultancy tasks. Employee summary details Designation Departments Positions Terms Director Management 1 Full-time Head Housekeeper Housekeeping 1 Full-time Tour Co-ordinator Tour 1 Full-time General manager Management 1 Full-time Restaurant manager Management 1 Full-time Head chef Production 2 Full-time Customer service Restaurant 4 Full-time Housekeepers Housekeeping 4 Full-time Receptionist Front office 2 Full-time Driver Transport 1 Full-time Personnel manager Human resource 1 Full-time Stewards Production 2 Part-time Accountant Management 1 Full-time The company seeks to employ the services of a recruitment agency who are specialized in handling tour and related business. The procured process saw the use of advertising option and referral method. The referral method proved more successful since it gives well-seasoned personnel. This will give an advantage over competitors because it brings out expertise which could otherwise be gained over longer time. The remuneration package for each personnel will be based on an hourly rate as will be developed by the human resource department. Regular inductions and in-job training are major strategies the agency will employ in ensuring employees match with current trends in tour travel, restaurant satisfaction and comfortable accommodation needs of the clients. The human resources department will undertake an individual ability assessment to ascertain performance and match remuneration with productivity. This practice has proved efficient with modern practices of human resource. Hourly rate is practice is applied in the international job market. This strategy eases the burden of covering remuneration, expenses for employees who are not productive and who take advantage of per month practice to benefit from the companies (Hall, 2013).  The standard legal procedures of employment will be followed to avoid any unfortunate legal situation. Each employee in all capacities will sign appointment letters which outline the terms and conditions of the appointment. Remuneration packages and terms of employment are also included in the signing in of the employees. This will ensure compliance to standard operations and enhance productivity. This also guarantees the employee of the nature of their employment and completely eliminates the fear of victimization. This also ensures dedication and sense of ownership, thus quality service realization. General services and growth assumptions Year 1 Year 2 Year 3 Plan Month 1 2 3 Current Interest Rate 10.00% 10.00% 10.00% Long-term Interest Rate 10.00% 10.00% 10.00% Tax Rate 30.00% 30.00% 30.00% Other 0 0 0 Key Financial Indicators The chart below indicates Axis Tour and Restaurant Agency projected sales in margin proportions in three initial years. The agency anticipates growth in sales with relatively stable operating expenses. Favorable economic conditions and forecasts of continued growth in the tourism industry support Axis Tour and Restaurant Agency planned financial success. Business registration The business will seek the advice and guidance of the local authority charged with registration of businesses. Zoning, nature of business and locations of the business are the key factors during registration. The company seeks to get the services in a one-stop shop to reduce cost and time incurred in lengthy registration processes. Registration involves specific licenses, fees and time validity. Because the business intends to venture into different lines of businesses, it will engage relevant license bodies. First, license in line of accommodation will be sought. This attracts two approvals namely; room tax and accommodation registration (Kline et al, 2014). The second line of business is the restaurant services. Food and drinks require licensing separately. Food production requires inspection and regular assessment on the hygiene status. The drinks also require liquor licensing which comes with regulations touching on time consumption, age categories and other standardization requirements. The third licensing involves tour operations. These include operating vehicles and passengers. Transport licenses include driving licenses and commercial vehicle license. Use of park and other recreational facilities managed by governments also requires permits to operate. The facilities include national parks and national reserves (Murphy, 2013).  Operating a business involves machinery, humans, physical properties, intellectual property and other legal entities. In this regard, insurance comes in handy. This ranges from motor insurance, life insurance and risk liability management. Axis Tour and Restaurant Agency will seek legal and expert advice on insurance matters and risk management policies. Marketing Programs Axis Tour and Restaurant Agency will engage two major programs which include: 1. Sending introductory information to potential travel agencies and corporate clients. This program is intended to inform of the services and invite the potential clients about the new endeavor. This will be measured by the number of bookings and services offered per client. 2. Personalized client engagement. This program is intended to establish personal relationships, and inform the prospective clients of the services. Achievement should be measured by the number requests for bookings and services offered to individuals. Positioning Statement Axis Tour and Restaurant Agency will be a tour based service company offering fair pricing, and personalized services. It positions itself to offer proactive ideas, solutions, and quality services. Pricing Strategy Axis Tour and Restaurant Agency will use standard market price and attempt to maintain margins of 30% to 35% and maintain a competitive pricing policy. Promotion Strategy During the first few weeks of operation, expressing excitement of the new company and offering quality tourism service is fundamental. Efficient information strategy and personalized contacts will emphasize personal service. Feedback from satisfied clients will always be our most important means of promotion (Lashley & Morrison, 2013).  Conclusions In conclusion, the business idea through feasibility study proves to be viable. By undertaking market, competitive advantage and feasibility analysis, business through funding and the obligation to the objectives set. Being passionate with this idea putting into perspective the objectives, the guarantee to succeed is variable. References Apostolopoulos, Y., Leivadi, S., & Yiannakis, A. (Eds.). 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