Business Plan of a Travel Agency in Australia - Case Study Example

TRAVEL AGENCY BUSINESS PLAN IN AUSTRALIA Name Institution Course Date Table of Contents Table of Contents 2 Executive summary 3 1.0 Introduction 4 1.1 Business Overview Idea 4 2.0 Market Feasibility 5 2.1 Size of the market 5 2.2 Growth Rate of the Industry 6 2.3 Customer and Market Capacity 7 2.4 Anticipated Purchases 7 2.5 Barriers Entry 8 3.0 Technical Feasibility 8 3.1 Technical and Management Experience Required 8 3.2 Company’s Growth Strategy 9 3.3 Starting Up the Agency 10 4.0 Financial Feasibility 11 4.1 Projected Profit 11 4.2 Projected Profit 1.62 Costs 11 4.3 Critical risks 12 Conclusion 13 Appendix A 14 Appendix B 14 References 16 Executive summary The New Travel Agency business idea is to carry out the organizing services for meetings and guided tours along with the nature information for big and small companies. Furthermore, the new agency will accommodate the business persons in their nature guiding tours. 50 % of the revenue that the agency will make will be channeled to the anticipated charity project by the agency named New Agency Travel College. The name of the corporate is New Travel Agency in Australia. The proposed location of the Agency is in Vorarlberg in Austria. The Agency’s business plan comprises of the marketing feasibility, technical feasibility, and financial feasibility. The size of the market is anticipated to be very large accommodating both the small and larger markets. The major customers for the agency will be the Congresses for both small and big companies across Europe. The New Travel Agency in Australia has some indirect competitors. The New Travel Agency will offer a complex package to its consumers and thus the size of the market is likely to be enormous. The task of the agency will be to find out hotels that are suitable for their clients to hold their congresses, meetings and presentations for their customers. It is at these congresses, meetings, and presentations that the potential clients will learn and experience the new and professional services delivered by the agency. The market feasibility will include the size of the market, growth rate of the industry, customer and market capacity, anticipated purchases, and barriers entry. The technical feasibility entails the technical and management experience required, company’s growth strategy, and starting up the agency. lastly, the business plan covers the financial feasibility which constitutes the projected profit, costs, break - even analysis, and critical risks. 1.0 Introduction The New Travel Agency in Australia will serve as a limited company in the travel and tourism service sector in Europe. The target market is the congresses for both small and big companies across Europe. The New Travel Agency in Australia does not have any direct challengers in the market for the reasons that its business idea is innovative. However, it has multiple indirect competitors such as the tourism agencies, sustainable hotels, and the congress centers. It is for these indirect competitors that the agency necessitates an upright marketing plan to attract the consumers to prefer their services to that of their indirect competitors. The marketing strategy constitutes the mailings to all the giant companies, a blog on Myspace about sustainability, direct marketing, business magazines in diverse states, gifts with the company´s logo, a website newsletters, and some videos on YouTube and social media. The company’s trends and profile will be established by businesspeople who have pledged to fund the New Travel Agency with 200000euro besides advocating for a loan of 300000 euros for a similar purpose. The Agency’s business plan comprises of the marketing feasibility, technical feasibility, and financial feasibility. 1.1 Business Overview Idea The New Travel Agency business idea is to carry out the organizing services for meetings and guided tours along with the nature information for big and small companies. Furthermore, the new agency will accommodate the business persons in their nature guiding tours. 50 % of the revenue that the agency will make will be channeled to the anticipated charity project by the agency named New Agency Travel College. The name of the corporate is New Travel Agency in Australia. The proposed location of the Agency is in Vorarlberg in Austria. The business address has been identified as new travel agency 56, in 6850 Vorarlberg. The agency aim is to sustain the status of a corporation or an organization. In setting up the new agency, six establishers will commit their own capital resources into business. The head office of the agency will be in Vorarlberg. For the business information in detail besides the contingent of the New Travel Agency in Australia, the interested persons can access the online website of the agency, www.NewTravelAgency.ac.ke 2.0 Market Feasibility 2.1 Size of the market The size of the market is anticipated to be very large accommodating both the small and larger markets. The major customers for the agency will be the Congresses for both small and big companies across Europe. A majority of the congresses experience difficulties in organizing such meetings and hence the business expects that this will provide them a platform to outsource the function (Stong, 2013, p. 42). The New Travel Agency in Australia has some indirect competitors. The New Travel Agency will offer a complex package to its consumers and thus the size of the market is likely to be enormous. The task of the agency will be to find out hotels that are suitable for their clients to hold their congresses, meetings and presentations for their customers. It is at these congresses, meetings, and presentations that the potential clients will learn and experience the new and professional services delivered by the agency. It will be important that the agency will not be responsible for the congresses meetings for the purpose of ethics and professionalism. The agency will only organize the hotels which are environmentally friendly to serve the ultimate purpose to the clients, and such services are expected to expand the market. The second service that the agency will provide to its clients makes it special and unique hence will attract a significant market size. The agency will organize tours that are nature guided Tours for those persons and businesspeople participating in the arranged congresses. 2.2 Growth Rate of the Industry With the emerging technology and necessity for businesses to share ideas, the travel industry has been increasingly advancing with multiple persons and organizations across Europe holding congresses to share ideas (Sansone, 2014, p. 32). The new travel agency will take advantage of such fact to offer the clients’ services that will make them share their ideas excellently as well as enhance aware of the environment through nature guided tours. The agency is expected to make gradual steps in growth within the travel industry. It will be more socially responsible and since it encompasses and innovative project of a traveling college it will get acknowledgment for helping a good cause hence growth will rise rapidly. With more years passing by, other companies will talk about the agency, and more other companies will want to combine fun, benefits as well as charity. With time, the agency will reach more and more customers from different countries and areas throughout Europe. The agency will also employ strategies through which it will move further to not only Europe but also North America, Asia and in future the whole world. It will also spend money for effective marketing to stretch a higher level of knowing the company. After the agency has thrived well in Australia and Europe at large, the European states are expected to market the agency by telling their cooperation syndicates all over the globe about the agency. In time, the agency can also expand its plan to numerous other states when they amass more profit. The scheme of the agency for the five years that follow is to establish its acknowledgment across the big companies of Europe beginning with Austria. 2.3 Customer and Market Capacity The major plan to in our customer and market capacity is to pursue big European corporations. At the commencement of the business plan, we will focus mainly on the Austrian enterprises both big and small ones. However, we shall advance our services to all the European countries. The market capacity is not limited and companies that have accessed our services can do the same as many times as they can. The agency will be very well organized and useful, and it is for this reason that the consumers will want to take more and more of their personnel to our nature guided trips as well as the services of congress organization. Moreover, the companies will tell their co-operation companies about our enterprise, and consequently, they will also want to use our services. The customers and market capacity are also not limited because new companies are established every day hence availing an opportunity to opportunity to attain more and more customers (Archer and Archer, 2014, p. 28). 2.4 Anticipated Purchases Multiple companies are expected to seek our services, especially on the nature guided tours. Such is because companies are developing a trend of getting more aware of nature and the environment consequently they will find it more significant to make use of our services 2.5 Barriers Entry What makes the New Travel Agency better than our competitor are the key success factors. These factors not only offer services, but they do provide services that are environmentally friendly, the consumers will get additional information about nature. Besides that, the agency also works for a good reason since the revenue they get goes to the college project. When the customers will be selecting between the enterprise and its contenders they will find the good cause certificate and the project as an added advantage hence opts to our services (NZ Transport Agency, 2011, p. 23). Our prices will also be advantageous since they are a little bit lower to that of our competitors. Clients will also choose our services because through this services they will be able to acknowledge the environment besides getting a certificate that will show them as socially responsible corporations. 3.0 Technical Feasibility 3.1 Technical and Management Experience Required The agency will be highly sensitive to the technological development especially on the use of environmentally friendly techniques to organize the congresses and the meetings. It will mainly focus on the emerging technologies such as the social media to lay its foundations and market the agency. The agency consists of sustainable services that are environmentally friendly. Due to this fact, it will require a joint venture or partnership techniques to thrive well (Camillo, 2013, p. 36). The skills required are the know-how of the environment as well as organization techniques which our agency has an adequate supply. The agency will also be a legal enterprise which will observe the government regulations as well as the environmental policies in its duties. Such will feature the agency as a morally as well as ethically upright a technique that enhances its markets growth (Syratt, 2010, p. 34). The agency will also employ key personnel’s with the roles of marketing managers, operations manager, organizing personnel, nature guides and a general manager. The personnel will be trained with the required skills and techniques for the same. The agency will also offer the technological services in the travel industry which include swimming, Diving, Spa, Tennis, Golf meeting rooms and mountain diving (Pizam, 2015, p. 64). The agency supports 100 percent technological support that is necessary for the field. 3.2 Company’s Growth Strategy The company growth strategy will entail professionalism in its services. It will offer a majority of career paths that will enhance its growth in the travel industry. Such include the trainers of the of travel personals in the established college. It will also employ tour guides who will enhance the smooth running of the nature guide traveling. Organizational managers will also be employed. Since the company will use the emerging technologies such as the social media to market its services, data analysts will also emerge as new entourage in the business (Media, 2011, p. 38). The platform is anticipated to enhance the drastic growth of the agency. In the agency work, technological success aspects for sustainable services will be requested by phone, through the Internet or in the company. The current trends in technology allow the people to access a lot about a company especially through the social media. The agency through this technological platforms will market their events through measures such as entertainment. Such factors will be critical to the success of the company since they bring more opportunities for the agency to be successful. The agency’s thought of incorporating the environment through the nature guides is also another technique that is expected to be a critical success for the enterprise. For a fruitful business, the agency will employ five technological techniques of corporate success. That is receptivity, responsiveness, relevance, relations and recognition (Cropp and Braidwood, 2015, p. 54). The New Travel Agency through relevance will employ that services that their clients will have relaxation and recreational services. It will also employ the technique of recognition by being unique and different from all the competitors. Therefore, the New Travel Agency will be the only market corporation doing sustainable travel services. For this reasons the agency will become closer to the consumers and offer them with good conditions a lot of activities and in the conference facilities. Receptivity will also contribute largely to the success of New Travel Agency. The company will have knowledge of where their customers are, and the mode of communicating with them for instance through magazines and direct mailings. Also through technological platforms such as the YouTube and Myspace. The agency will also make use of technological aspects so that they can be responsive to their clients. Relationships will also be crucial for the agency. These will mostly be for the company and consumers where technology will be widely applied. For instance through the emails and the social media platforms such as Facebook, Twitter, and Instagram. Such will greatly boost the growth of the agency services because technology fastens the marketing and makes working criterion easier (Pizam, 2015, p. 28). 3.3 Starting Up the Agency The business will be established in Vorarlberg Austria where it will start by acquiring the forms from the commerce chamber. To institute the corporation the agency will require a provident certificate of competence (NZ Transport Agency, 2011, p. 54). After this stage of filling in the papers the agency will open up a bank account with a minimum requirement of at least 35.000 Euros since it will fall under the limited company (Cropp and Braidwood, 2015, p. 64). The agency already possesses 200.000 Euros which will facilitate this context. After that forms of the agency will be taken to the Board of Trade. Before it can be allowed to establish the business, the agency will be required to have a commercial register that has already been approved through the signature by the limited company agencies contact at the notary. The New Travel Agency will abide by the National Security rules of Australia. 4.0 Financial Feasibility 4.1 Projected Profit We expect to sell more and more of our service in the travel industry. Our services will offer a good balance by providing them with the customer`s expectations. The prices will offer competitive market with substantial gains. The fact of the good promotions the sales will be growing in the five years that will follow. The future and present focus on the environmentally friendly service such as friendly environs hotels together with the realization our own nature scheme we expect, that consumers will value our idea of enlightening the world and the company. The year 2016 2017 2018 2019 Net sales 89000 109000 119000 156000 Cost of sales 621000 741000 770000 853000 4.2 Projected Profit 1.62 Costs The capital that will be invested in the agency is projected to be 200000 €. It will be made up of the contributions of each joint owners, donations from well-wishers as well as the interested parties. There are six joint owners, dual of them invest 40000€, four of them capitalize 10000€, and each of Hotels devotes 10000€. We plot to take a credit of cash 50000€, which will be invested in our corporation which will cater for the realization of the expected challenges as well as the anticipated increase in the number of our clients. We do expect a weighty upsurge in profits for the duration of the next five years since we will make efforts to gain new consumers from Australia besides the possibility of doing so from abroad. The agency is also willing to cooperate directly with our permanent customers, and we will employ all the necessities to maintain the relations. 1.63 Break - Even Analysis The year 2016 2017 2018 2019 Revenue 89600 1090000 1200000 1380000 All Costs 912000 1019000 1070000 1150270 In the second years of the agency’s operation, the company will make profits. Such will be attributed to the investments devoted to the promotion of the services and the market strategies that will make the agency known across Austria and the Europe at large. The agency through its steady cooperation with the clients and the recommendation it will receive from those that will have accessed our services will be a great boost. The break analysis shows the years that the agency is expected to begin making money through the estimation of the fixed and variable costs along with the gross sales (Cohen, 2011, p. 44). 4.3 Critical risks The major critical risks will be the anticipated influx in need of the agency services. Such will be handled through seeking cooperation with several environmentally friendly corporations in the travel industry. They include the hotels and conference facilities across Australia. Another imminent risk is the shortage of finances which will be tackled through the request of loans and partnerships with capitalized institutions Conclusion In conclusion, the new travel agency in Australia Team has the thoughts that the Business Plan formed will be a massive success in the coming years. The agency is functioning in groups to check on different subjects such as the Current Situation of the travel industry, the financial plans, and the marketing plan. The agency personnel got an image of a global project and made the experience that it can hard to make oneself comprehensible. The agency is expected to thrive through all the challenges and emerge as the best newly invested travel agency that offers the best travel services. The Business Plan for the Travel Agency also incorporates the marketing strategy in addition to a lot of information over significant financial facts which will enhance its success. Through the working groups a lot of the requirements for the success of the agency and the actual techniques that we have to employ. It highly expected from the interested parties and the partners at large that the business will succeed especially due to the seriousness observed in the plan and the support showed by the parties willing to fund the plan. Appendix A Start-up Expenditures and Expenses Worksheet Item Total Cost Cash Required Land 20 000€ Capital Equipment 40 000€ Computer 10 000€ Beginning Inventory 30 000€ Startup Supplies 25 000€ Licenses and Permits 5 000€ Leasehold Improvements 15 000€ Utility hookups& Installation 10 000€ Advertising (Preopening) 10 000€ Insurance 20 000€ Other 25 000 Total Estimated One-Time Cash Requirements 200000 €. Appendix B Start-up Operating Expenses Estimate No. of Months Total Cash Item Monthly Expense X before Break even = required Owners Salary 16 000€ Employee’s salary, wages, benefits 12 000€ Rent 8 000€ Promotion expenses 3 000€ Supplies and postage 3 000€ Vehicle Expenses 6 000€ Telephone 1000 € Travel 3 000€ Interest 2 000 € Maintenance 5 000€ Other 8 000 € Total Cash Required to Cover Operating Expenses 76 000€ Plus: Total One-Time Cash Requirements (Previous Table) __________ Add 10% Safety Factor __________ Total Cash Required for Start-up _________ References Archer, J., Archer, J., 2014. Manual of Travel Agency Practice. Taylor & Francis. Camillo, A., 2013. Developing a business plan for a travel agency: case company: Scandic info. Laurea-ammattikorkeakoulu. Cohen, W.A., 2011. Model business plans for service businesses. Wiley, New York. Cropp, R., Braidwood, B., 2015. Start and run a profitable travel agency: your step-by-step business plan. Self-Counsel Press, North Vancouver, B.C. Media, B.L., 2011. CTH - Travel Agency & Tour Guiding Operations Study Text. BPP Learning Media, London. NZ Transport Agency, 2011. Business travel efficiency guidelines. NZ Transport Agency, Wellington, N.Z. Pizam, A., 2015. International encyclopedia of hospitality management. Elsevier Butterworth Heinemann, Amsterdam; Boston. Sansone, D., 2014. BEHEA Slovakia: An evaluation of the feasibility of setting up an online travel agency. Cardiff Metropolitan University, Urbana. Stong, K.J., 2013. A business plan for a new retail travel agency. University of California, Berkeley. Syratt, G., 2010. Manual of travel agency practice. Elsevier /Butterworth-Heinemann, Amsterdam; Boston.  Read More