What should you do first: What is the difference? A feasibility study, or business opportunity analysis, is a planning tool similar to a business plan. The feasibility study is done to flesh out the possibilities in an initial business idea.
Hospitality industry news, articles, publications, trends, tips, ideas, strategies and best practices … Hotel Feasibility Study, Step 1 when Planning a New Hotel or Resort In over ten years of helping hotels to open and remodel successfully, we have seen time and again at Xotels how indispensable a feasibility study is.
We have also seen how many would-be hoteliers simply assume that their vision will succeed, without conducting any notable research on building a hotel business that will be consistently profitable and competitive. In this article we look at the steps involved in carrying out an effective hotel feasibility study.
What is a hotel feasibility study and do you need one? As the name suggests, a feasibility study investigates your hotel proposal to see if it is feasible as a sustainable, profitable business model.
It does this by considering its viability relating to market, location, costs and financing. A feasibility study forms the cornerstone of your preparations for your new or remodelled hotel. It shows investors how they will receive a return on their investment ROI.
It is therefore ill-advised to proceed without carrying out this crucial investigatory and illuminatory step.
Below you will find a template plan and approach the expert team of our hotel consulting company takes to put together a comprehensive validation report, based of financial and market analysis, to determine the viability of a new hospitality project or lodging concept.
The key steps of an effective hotel feasibility study 1. Location analysis Studying proposed sites for your hotel or resort aims to answer a number of questions critical to the success of your hotel project.
What makes the location an attractive site? Is there a supply of labour sufficient in number and quality? What human resource costs can be expected? Is the hotel supported by easy transport links? What are potential risks and advantages associated with the local area? Total costs calculation This includes the development and architectural costs prior to opening the hotel.
Then there are the operating overheads which the hotel will incur, including licences, taxes, equipment, furniture, insurance, human resources, inventories, electricity, water and more. Local hotel supply and demand investigation This involves analyzing all hotels in the local area, chiefly their competitiveness.
Information can be found with tourist boards, tour operators and travel research groups. Knowing local hotel supply and demand helps in projecting occupancy levels and rates for your hotel, one of the key elements in establishing its economic feasibility.
Year-round projections for demand will go a long way to informing your pricing decisions. Establishing and projecting hotel revenue sources The main sources of revenue for your hotel will come from room stays, food and beverage, and events such as conferences and meetings.
Using your projections for average year-round room rates and occupancy levels, you can project sales from different revenue sources, including food and beverage, leisure and events. They help to show if the investment return is enough to proceed and if you will need to find financing from elsewhere.
If so, will the lenders of this capital be content with the projected ROI?A feasibility study, or business approach analysis, is a planning tool similar to a business plan. Hence, the feasibility study helps determine whether an idea or business is a viable option, a feasibility study is carried out to know if the business venture is worth the time, effort and resources.
While a strategic plan is a type of business plan, there are several important distinctions between the two types that are worth noting. A strategic plan is primarily used for implementing and managing the strategic direction of an existing organization.
What is the difference between a business model analysis and a market feasibility study? Follow Upvote Report Question Comments (0) Register to Answer this Question Register. Log in if you're already a Difference between Feasibility Study and Business Plan.
While a business plan is made up of mostly tactics and strategies to be implemented in other to start and grow the business. 3.
A feasibility study is all about business idea viability while a business plan deals with business growth plan and sustainability. 4.
The Difference between Pre-feasibility Study and Feasibility Study February 21, February 21, Rifka Aisyah Works In this post I want to share a little my knowledge and understanding regarding the difference between Pre-feasibility study and feasibility study.
There is 4 Differences between Conducting Feasibility Study and Writing a Business Plan 1. A feasibility study is carried out with the aim of finding out the workability and profitability of a business venture.