Business Plan Analysis Name Institution Introduction The names of the co-owners lack contact details. The details could be added so that any of them could be contacted. Additionally, the percentage shareholding and cash that each co-owner has contributed should be indicated for transparency purposes. Description of business The status of the business should be stated (whether it is starting up, taking over or expanding). The investors are left to assume the type of business it is. The business form also needs to be addressed.
It should be clarified whether it is a corporation, partnership, or a limited liability company. The chances of the business succeeding should also be analysed at this point. The experience the owners of the business have should be presented in order to offer just judgement concerning their hope for succeeding in running this business. The reasons why the owners believe the business will be a success should be clearly outlined here since any liable investor will not desire to give into investing in a hopeless business (Donald, 2004).
Confidentiality This needs to be agreed upon among the co-owners it is not supposed to be a personal decision of one of the owners. Therefore to indicate their consent a provision for their signatures should be offered. Industry outlook, forecasts and trends The projection of trends also needs to note the status of the other important factors that impact the business environment. This includes providing knowledge of the technological, legal and political trends nationally and internationally.
These are key factors that govern the environment; therefore, they should not be omitted. The industry’s projection also needs to provide information of the new firms in the previous three years. The information on the performance of these firms will help the company in doing its personal projection. This will avoid making projections that are either too high or too low, hence, deal with no realism (Donald, 2004). Description of venture The description of the venture is lacking. This is because the business plan leaves quite crucial information.
It is important to comprehend the features of the products and services that this company is planning to provide as well as know the future developments of the same. The long-term and short term goals of the company in regards to the products and services should be clearly outlined. It should be clear that the company has objectives in regard to its products and service since a company that seems settled in an unfocused niche and is unprepared to scale new horizons is bound to be stack in the same place. Another flaw in the description is the lack of information concerning the size of the business.
Though the business is of low cost given that most of its operations are online, and maybe its meetings with the customers are probably held in a medium sized premises, this needs to be clearly outlined here. All office equipment needs to be listed in order to understand just how much equipment is sufficient. For instance, it is important to understand how many computers are required, and the amount to be invested in acquiring the materials. Information on any other raw materials towards conducting the business should not be left out (Donald, 2004). Market segmentation
The third segmentation states that customers travel for various reasons, yet bias is given to people travelling for pleasure and business. The business plan should explain how the company will handle the rest of the clientele who are not travelling for leisure or business. Planning only for visitors who travel for business and leisure might be very limiting. Other visitors might be travelling for education and research purposes, and consideration for such should also be made. Again, it should be clearly indicated in each segment whether the segment is growing or declining.
This is in order to understand the chance of having the business growing declining or remaining steady. This gives a low profile on the company since it seems that inadequate market research has been conducted (Donald, 2004). Competitive sector The business plan needs to provide information of the sales made by these competitors. It should also be clearly outlined of the performance, especially in regards to the market segment targeted by United, which are the older people. Information of increase and decline of business for the competitors should be provided in order to help know where United is placed or positioned.
Just giving facts about its competitors is not sufficient. It is also important to outline the market segment targeted by competitors. This will help understand of the specific performance of the competitors in relation to the same target market that United is specialising in satisfying. For each competitor, the expected changes on the entry of united travel should also be noted, in order to know the chances of beating its competitors. Competitive advantage The company’s competitive advantage is slim, given that most of its advantages can be met by the companies which are its competitors.
Maybe the company would offer more services against its competitors such as a pricing advantage, better and faster technologies, and benefit ratios to customers. The plan of focusing on the older people with hope as an advantage against its competitors seems not well researched into. This plan poses risks. This is because, the projections that the old folks will be internet savvy by 2004 it only a forecast. This means it might or might not happen. Therefore, the business plan needs to make realistic assessments whereby it allows for facilities to deal with risks.
The competitors profile also needs to be provided. The information provided on the profile of the competitor is very limited. Additional information on the turnover rates, profitability of business in the competitors firms, company sizes and their market shares should also be provided. This is to help United to deal with bigger facts when planning of means to beat its competitors. More than indicating facts of how the enterprise will be advantaged it is also good to note the premise benefits to the client. Operation plan The operational management has an omission.
This is in regard to having the customer’s payment before one starts to make arrangements and bookings. This is because a form of payment, maybe deposit, should act as security that the customer will not cancel the trip when much preservation has been made, hence, lead to a loss to the travel company and to the companies it had made bookings in. Another flaw in management is concerning the technology used. An outline of the technology that will be used should be provided. Technology use should be innovative. Moreover, it should be easy for the old folks to access the technology without trouble.
Reliability of the technology should be clarified. For instance where the customers are expected to pay half or their full trip expenses before the trip itself through online money orders, visa cards and credit cards, they might need assurance that such technologies will not be used against them to fraud them. Marketing plan It is important to involve diverse and promising ways of advertising. How much care package should be given to the customers to encourage recurrent trips from them as well as positive talk as they talk about the company should also be specified.
This is because many companies provide this, and the plan is to get United Travel to deliver more than its competitors. Such tokens should however not be exaggerated since, in such a case, the company might experience a loss. The company should indicate how it will reach their customers within one and half a year that the company will be developing a website. This is important given that the company does not provide any other means of reaching the clients except through the chat rooms. It is also not evident what will occur if the company does not get sufficient funds as expected within that time span.
The cost of outsourcing the website once launched should also be given since every plan of the operations need to be strategized to avoid making plans that are exaggerated and economically unreasonable. Strengths and weaknesses The business plan should not just make a listing of weaknesses which it is not working on, the company should outline the efforts being made to work on the weaknesses, for instance, efforts to reach customers living far from Brooklyn, where the offices are. Efforts to be linked to one of the local airlines should be made to avoid demanding payments from customers too close to flight departures.
Threats Similarly, United should have ways of protecting itself from the threats. For instance, in terms of political instability, the company should not only be insured but also invest in safe avenues for the provision of accommodation for its customers in case of emergency cases of insecurity. Service Development Strategy Claiming to offer as much customized services as the customer will require is quite exaggerated. This claim makes the company appear to be a solution to any exaggerated desires of a customer. This is flawed given that he company has other limiting factors such as, finances and time. Only much time and money can be spend on one client, so as to meet numerous needs of the other clients. Pricing It is important to include the times of the year that customers will get different pricing and by how much the prices in those seasons will differ. Comparing the pricing with the competitor’s pricing strategy is also important since it will assist the company from overpricing or under-pricing its service. Therefore, statistics of the real figures should be researched and noted.
Developing a strategy to insulate the company from the competition in pricing will help maintain the business without having to drop its prices, in case the competitors use that strategy. Such strategies would include providing exceptional services such that the customers do not mind covering the price and do to choose to travel with the competitors instead. It is also important to research on what the customers considers as quality pricing. The pricing strategy should bear in mind the cost of production. Promotion The company should ensure that expensive promotion media are well compensated in the pricing.
This involves enlisting it as an expense. However, extremely expensive advertisements should either be avoided or provide for means to finance them. Management Team Background The management personnel which constitutes of the four co-owners, though well educated in various areas, none has specialized in travel and related courses. This makes them vulnerable since they might not have first hand information on handling tour related challenges. Again it is an added expense to the company given they have to outsource outside companies to perform some of the functions for them, for instance, the owners may lack now-how of operating the reservation systems such as SABRE and Amadeus. This calls for efforts for the owners striving to gain such information, for instance, through advancing their education. Having knowledgeable personnel is not enough since a business proprietor should understand the tasks of the business they conduct quite well before delegating it. Again, besides outlining the personal information, achievements and duties of the owners it is also important to note whether the business will involve hiring of other personnel as employees, and what qualifications they would need to have. Assessment of risks
The risks in this business plan are only listed yet plans on how they will be overcome are not outlined. Emergency plans should also be outlined to protect the company from falling in case of an unexpected occurrence that could affect business. These includes, first ensuring that customers are insured in order to cater for minor accidents that might occur during travel. This is in order to increase customer confidence. Another plan is relying on past experiences and forecasting in making trip plans. This will help the company to know the best timings for planning trips to avoid issues of bad weather.
Since the recession and inflation are external forces that the company cannot control, plans should be made to counter-face them in case they occur. For instance, the company could plan to make its trips few during such times, specializing in only exceptional travel services which would worth a good price. The company should also display expertise and honesty when dealing with its online services to avoid being screened by the government. Financial plan This financial plan overlooks the assumptions made on Sales provided by price segment demographic factors.
There is the flaw in assuming that the sales plan will go as outlined, and not making provision for any outcome. A sensitivity analysis offers details of the actions that the company will undertake in case the expected sales and expenditures do not go as forecasted. This proves to investors that the company is realistic enough to expect the worst and plans to overcome it diligently. It is also important that amount of inventory needed to realize the sales forecasted be outlined. Conclusion In conclusion, a business plan should present realistic ideas of the business.
Facts should not just be delivered; an explanation should be offered in order to avoid controversies. Besides, a well detailed business plan grants prospective investors confidence while considering the chances of investing in the business. The ideas should be presented in a way which the investor can trust. Such factors like costs, forecasted problems, threats, challenges and any other factor that poses a threat to the business should be addressed in a satisfactory manner. The business to be conducted, how to conduct it and every other issue involved in conducting the business, should also be explicitly addressed.
Unrealism should be avoided, for instance, it should be expected that at certain points the business would experience certain shortcomings. Provisions on how to deal with every possible shortcoming should be addressed. Inaccurate information should be avoided, for instance, stating that things are expected to have a certain outcome, yet in reality there is no way provided to get to it. Generally, all that the investors seek is a trustworthy foundation before proceeding to invest in the business.
Cite this Business in Tourism and Hospitality
Business in Tourism and Hospitality. (2016, Oct 29). Retrieved from https://graduateway.com/modesty/