Industry Analysis is A Must in a Business Plan Structure For Hotel Reservation

Rapid strides in technology have opened vistas of new opportunities. Think of the recent perennial lack of time in our lives, people being continuously on the move, and an outline for a business plan structure for something like a hotel reservation starts taking shape in your mind.

To execute what you have in mind would need a proper business structure that will address issues like:

Your Target Customer Base

It is highly unexpected of a CEO of a company to demand a stay in anything less than a five-star hotel; likewise it is quite unlikely that a salesman on a business trip will be provided with expensive accommodation. Such circumstances demand you be clear about the segment you want to target, i.e. will your website tie up with five-star hotel chains, budget hotels, or both.

You will also want to decide beforehand whether you will tie up with a particular hotel chain or would you like to have on-board a multitude of companies catering to the hospitality industry. One factor that needs attention is your website’s infrastructure. Is the design and capacity of your website equal to the task of hosting high traffic with convenience? You would have to decide in advance whether your website only caters to accommodation or will it also provide booking facilities for marriages, conferences, business meetings, or any other such events.

Revenue

Your proposal should clearly detail the sources of your revenue. How much commission would you be charging hotels whose rooms are booked through your website? How much do your competitors charge? How do you expect to provide a better deal vis a vis your competitors? How much is your budget for promotional activities and which steps will you take to ensure the message reaches the intended audience? How will you entice travelers and when do you expect to break even also needs careful detailing.

Industry Analysis

It is an expanding industry and competition will be intense. You need to take into account your closest rival, its market share, and note the way this industry is headed. With the world economy in shambles, corporates as well as individual households are tightening their purse strings. There is less traveling (both business and leisure) and restructuring is taking place in a big way. Such a situation demands that you be realistic. The right anticipation of challenges you are likely to confront would prepare you better to handle them. The focus should also be on your marketing strategy with more stress laid on external environment.

Operational Plans

Be clear about your business concept and logically explain your company’s growth and development plans. How will you ensure that you are not sidelined by the existing competition or nudged by a new entrant? Is there a possibility of horizontal development by creating more capacity and capability? For example, you may decide, in due course of time, to open travel portals that will cover the entire gamut of activities like holiday planning, ticket arrangements, car rentals, etc. to professional guide services.

Dreaming for Buying a Car with Credit

One thing is quite normal at this time when people have a dream about a car that should be parked in front of their house and car that will be driven on the road. Many people even have a plan to take cash for cars because they want to get a car that really fit with their dreams. Various types of cars are offered with a variety of specifications. Of course, people will be tempted by the car with the latest designs and features that can be found today.

However, it does not mean that people can buy any kind of car that is in their dreams just because they are backed by cash for cars brooklyn. Even banks will have so much consideration before the car loan application can be approved. People should consider their financial situation before they can choose a car. They should ensure that they will be able to pay the monthly payment auto loans so that they will not damage their financial plans as well as payment for their dream car.

Although the latest model of the car will be very tempting favorite, it would not hurt to choose the previous version of the car with the features of the older options if they cannot really pay the price of the latest version.

Does Your Business Plan Ease These Investor Concerns?

Business investors are sensitive to at least three major constraints when evaluating business plans. I call these constraints The Three R’s: reality, readiness, and resources.

Reality

Many creative entrepreneurs with ideas for scientific breakthroughs have ended up frustrated with business investors who just don’t seem to “get it.” The truth is, however, that it’s the entrepreneur who’s not getting it.

Unlike creativity or scientific breakthroughs, starting or expanding a business requires the entrepreneur be keenly aware of their customers, competition, and core competencies.

Creativity and scientific breakthroughs often disregard the customer, the competition, or a company’s core competencies, which is why they are usually risky and often require significant capital over several years before they are monetized. The opposite type of investment most business investors seek.

For example, suppose you had an idea for a new everlasting light bulb. After researching the market, you determine that customers do want such a bulb and are willing to pay a premium for it. Preliminary manufacturing studies show that you can produce the bulb and profit nicely from it. Would business investors be receptive to backing a business plan that puts you up against the likes of General Electric or Westinghouse? But, you say, your plan is to some day sell your idea to these competitors. Again, how receptive would a GE or Westinghouse be to a plan that obsoletes a major product line? What would HP do with a plan that killed its aftermarket in print cartridges? Do you see the flaws in such thinking? Business investors do.

That’s why business investors like to invest in business plans that are grounded in reality. Plans based on reasonable risks that can be monetized quickly and generate a return on their investment. Although the everlasting light bulb strikes a consumer hot button, it fails the reality test by not addressing the distribution network and shelf control of large competitors. More important, the strategy to sell the business to one of these competitors is a flawed exit strategy.

Readiness

The second major consideration that a business investor wants addressed is readiness or timing. Unless the time is right for the proposed business plan, business investors are not likely to support it.

Take for example a business plan to introduce dishwashers in Japan in the early 1970’s. When dishwashers were rapidly becoming popular in other areas of the world, the average Japanese kitchen was too small to accommodate the new appliance. Moreover, the prevailing attitude among homemakers was that dishwashers were for the lazy or the idle rich. It took over a decade of attitude, social, and cultural changes before the timing was right to successfully introduce dishwashers to the Japanese market.

Business plans not only fail to gain support when they are premature, they also fail when they are late. Think how many American and European watch, automotive, or camera manufacturers lost their competitive advantage in their respective international markets because they resisted automation or robotics until it was too late. It is unlikely that investors would support a U.S. business plan based on automation or robotics in one of these markets today.

Resources

It’s amazing how many entrepreneurs ignore or neglect this constraint. Perhaps they believe that this is the entrepreneurial way…to know no obstacles. Although this attitude may impress self-help gurus, it won’t impress business investors.

The business plan graveyard is filled with plans that failed because their entrepreneurs were not sensitive to resource limitations. In most cases, these limitations range from the entrepreneur’s lack of sensitivity to their own internal resources and skills to not fully understanding what it takes to execute the plan itself.

This is especially true of businesses that are trying to expand through diversification. The world markets are filled with food companies that have failed trying to enter pharmaceuticals, chemical companies that have failed trying to enter foods, or electronic component manufacturers that failed trying to enter final assembly.

For start-up companies, entrepreneurs often fail to adequately estimate cash requirements or the time and resources required to build distribution channels, win customers, or to launch or sustain a business.

Business investors, experienced ones anyway, are all too familiar with the importance of resource constraints. So, when business investors zero in on this area and challenge your assumptions, don’t get too defensive. Instead, listen to their concerns with the knowledge that they can help you tighten up your plan and improve your chances of success.