96811714 Hotel Resort Business Plan Executive Summary Company Summary Market Analysis Competitive...

12/06/2012 13:23Hotel Resort Business Plan - Executive summary, Company summary, Market analysis, Competitive environment

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Hotel Resort

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BUSINESS PLAN SEVENELMS RESORT

65000 Windy Lane Dr. Traverse City, Michigan 49865

The Seven Elms Resort out-lines how it will provide quali-ty hospitality services, cost-effectively, in a popular north-ern U.S. lake resort environ-ment. This plan successfullyraised capital for property acquisition, renovation, and company start-up related costs.

EXECUTIVE SUMMARYCOMPANY SUMMARYHOTEL & LOUNGE OVERVIEWMARKET ANALYSISCOMPETITIVE ENVIRONMENTSTRATEGY & IMPLEMENTATIONPROMOTION STRATEGYFINANCIAL PLAN



RESUME

EXECUTIVE SUMMARY

We seek funds for the acquisition and renovation of Seven Elms Resort, an adult-mar-keted, 17-room "boutique style" hotel specializing in a couples' "getaway" to providerelaxation and recreation in Benzie County, a popular tourism spot located next tothe state of Michigan's Lake Michigan. Moderately priced between the high-line hotelproperties and the older motel strips, Seven Elms Resort shall fill an affordabilityniche not presently available in Benzie County.

Combined with an on-site lounge, grill, poolside beverage service, and morning con-tinental breakfast bar, we are seeking investment funds to renovate the hotel build-ing, build-out a piano bar/lounge area with dance floor, and construct an outdoorpool adjacent to the indoor pool. With this refurbishment and other new amenities,Seven Elms Resort will form the basis of a highly profitable hotel venture. We areseeking funds to develop and expand the business in a phased approach, as high-lighted within this document.

Seven Elms Resort's owner, Steve M. Blackburn, has an extensive business back-ground, including over 14 years of experience developing a variety of businesses. Mr.Blackburn received his B.A. in Business Economics, and currently is an M.B.A. candi-date at the University of Michigan. Desiring to return to his own business, he wishesto establish Seven Elms Resort, Inc. in 1999.

The foundation for the plan is a combination of primary and secondary research,upon which the marketing strategies are built. Discussions and interviews were heldwith a variety of individuals involved with other similar businesses to develop theproforma data, review the market potential, and competitive situation.

Renovation in the Prairie Style period, our hotel's design elements and furniture willreflect this "organic" approach and provide an overall comfortable experience. SevenElms Resort shall specialize in meeting an individual or couple's needs. As growthwarrants, the 10-acre site would allow for future expansion of the lodging portion ofthe resort (Phase II).

Business Plan Purpose



Introduction

In today's highly competitive environment, formal business planning is an essentialelement in achieving business success. A well-written business plan is primarily acommunication tool used to obtain financing. In certain instances, particularly withour early stage company, this business plan also serves as a strategic plan.

Considering that lenders are inundated by numerous investment opportunities fromwhich they choose only a few, this business plan describes our story and how we in-tend to grow. Seven Elms Resort, Inc. management team has made an in-depth analy-sis of its opportunities and weaknesses and it has concluded that the company has anexcellent chance to succeed.

Methodology for Business Planning

Sophisticated business planning helps management answer questions, such as: Whatwill be our record of achievement? How have we fared compared to our competitors?Are we setting realistic and attainable goals and objectives?

Constructive and useful business planning requires a broad-based understanding ofchanges taking place in the marketplace in which the company competes, or plans tocompete, and the ever-changing financial markets. In-depth technical skills in a vari-ety of disciplines such as financial analysis, sales and marketing, latest technology,and managing growth are critical components in assessing a company's opportunitiesand risks.

Developing the Business Plan

The management of Seven Elms Resort, Inc. has developed this disciplined planningmethodology to help the company anticipate its start-up costs and other critical infor-mation to arrive at this realistic plan.

Guidance from Outside Professionals

Mr. Blackburn has sought legal assistance and advisors to develop the Seven ElmsResort concept. Steve will maintain an active management involvement in every as-pect of daily resort operations. This plan reflects his vision.



Five Objectives of Seven Elms Resort, Inc.

1. Attract $1.4 million mortgage/investment capital;2. Focus ideas and establish goals;3. Identify and quantify objectives;4. Track and direct growth;5. Create benchmarks for measuring success.

The business of Seven Elms Resort, Inc. is the creation of and funding of an adult cou-ples' 17-room hotel, specializing in a "getaway" atmosphere to provide relaxation andrecreation in the Greater Benzie County/Lake Michigan area. Management is solicit-ing commercial finance partners who share its vision and desire to participate in thisexciting business opportunity in the resort community of Benzie County, Michigan.The integration of these disciplines results in extensive and innovative services, set ina unique Prairie Style surrounding for our prospective guests.

Ideal Property Location

The preferred location is a 10-acre parcel with 8 acres of woods. Of the 18 rooms, 3are executive suites, with Jacuzzi tubs, and one of them will be converted to an onsitemanager's apartment. Each room has individual climate control, direct-dial phones,and televisions. The facility has a large main lobby area, indoor pool/Jacuzzi/sauna,lighted tennis court, 2-car garage, storage shed, ample parking, and all equipmentnecessary for operation of the motel. The separate onsite manager residence andmeeting room complex will serve as a future lounge/grill space. The grounds arebeautifully landscaped.

The motel is located in the motel district of Benzie County and is situated on 9.43beautifully landscaped, wooded acres. Approximately 7 of the 9.43 acres are woodedand undeveloped, which creates an opportunity for significant expansion or potentialfor an entirely new enterprise.

This facility consists of one building, built in two phases: a 22- and 15-year-old two-and one- story wood frame 18-unit motel and manager's/owner's apartment, whichwhen combined, total approximately 14,787 square feet of living area. The 18-unitmotel includes a lobby with a fireplace, reception area, storage area, laundry room,bathroom, meeting rooms, a balcony, 18 room units, a men's and women's bathroom,kitchen, a whirlpool/sauna room, an indoor swimming pool, and mechanical room.



The motel has a partial basement and includes a laundry room with two washers andtwo dryers.

The manager's apartment (future piano bar and basement bar/meeting room area)offers a living room, kitchen, dining area, family room, half bath, and gift shop on thefirst floor with 3 bedrooms and 2 baths on the second floor. The home has a concreteblock basement that is partially finished with a recreation room and a 3/4 bathroom.

The exterior is cedar and the roof is pitch and pebble. The building is seated on apoured concrete and a concrete block foundation. Interior walls are concrete blockand drywall. The flooring is carpet and ceramic tile. There are casement windowsand wood storms and screens. There is a basement area under the living quarters anda portion of the motel.

Other improvements include a 2-car garage with 2 electric door openers. A detachedstorage shed is located to the rear of the manager's apartment. Land improvementsinclude a blacktop driveway and parking lot with 23 parking spaces, concrete side-walks, a lighted tennis court, street signage, and beautiful landscaping with a maturevariety of trees and shrubs.

Mechanical systems include five gas hydropic, two gas forced air furnaces, electricbaseboard heat, individual heat, and central air for each unit; 120-gallon hot waterheater, 600-amp electrical service, intercom system, two central vacs, water softener,sump pump, 4-camera security system, cable television, smoke alarms, and telephonesystem.

Mission Statement

Seven Elms Resort, Inc.'s mission is to provide quality hospitality services to ourguests in a comprehensive and cost competitive manner, providing the finest accom-modations in Benzie County, Michigan.

Company Business Plan Objective

This business plan serves to detail the direction, vision, and planning to achieve ourgoal for providing superior and comprehensive hotel and lounge services. Our planobjectives are:

Attract $200,000 bridge loan to secure $1.4 M property mortgage



Focus ideas and establish goalsIdentify and quantify long-term expansionTrack and direct growthCreate benchmarks for measuring success

Seven Elms Resort shall fill a niche not presently available, namely a moderatelypriced (under $130 per night, summer rate) resort. Combined with an on-site lounge,a grilled food service, an indoor and outdoor pool bar, and a morning continentalbreakfast offering, we shall differentiate ourselves by becoming a "boutique style" re-sort versus simply another motel. With the construction of an outdoor pool adjacentto the present indoor pool/whirlpool/sauna complex and our other refurbishmentand new amenities, Seven Elms Resort will form the basis of a highly profitable ven-ture set in a Prairie Style environment.

COMPANY SUMMARY

Company Ownership

Mr. Steve Blackburn founded Seven Elms Resort, Inc. hotel and lounge in 1998 as aMichigan Subchapter "S" Corporation. Since 1985, Steve has had extensive experiencein creating and managing organizations for environmental and economic develop-ment-oriented companies involved in nationwide projects.

Steve consults with area businesses in development-related issues, including finance,and is a United States SBA counselor at the Small Business Development Center atthe University of Michigan. Past SBA clients include service and manufacturing orga-nizations. He is a certified SBA Fast Track program instructor, a Michigan licensedloan solicitor, with a specialty in commercial finance, and a guest lecturer at U-M forBusiness Plan Writing Workshops. He has started previous business and corporatesubsidiaries and looks forward to managing Seven Elms Resort on a daily basis.

Currently, Steve is an M.B.A. candidate at U-M and holds a Bachelor of Arts degreein Business Economics with a minor in chemistry from Notre Dame University.

Key Advisors to the Company

Seven Elms Resort, Inc. has additional key staff members and advisors to assist dur-ing the development, planning, and initial planning phases. They include an architect



trained at the University of Notre Dame, CPAs, and former managers of bar and Bedand Breakfast style properties.

Management & Organizational Summary

Mr. Steve Blackburn will manage all aspects of the business and service developmentto ensure effective customer responsiveness. Qualified resort associate professionalswill provide additional support services. Support staff will be added as guest and/orpatron load factors mandate. Blackburn has joined the American Hotel and Motel As-sociation.

Corporate Development Plan

For purposes of this Business Plan document, Seven Elms Resort, Inc.Phase I andPhase II for developmental growth are defined below:

Phase I

This phase involves preparation and development of Seven Elms Resort. Until theideal property is acquired, Seven Elms Resort, Inc. offices will be housed at the homeof Mr. Steve Blackburn, its founder. The property will establish its own Prairie Styleidentity, management directives, and capital. Incorporating a total quality manage-ment approach and a guest appreciation program, Seven Elms Resort will developkey repeat guests and lounge patrons. Through word of mouth and advertising, ourreputation as an affordable "boutique style" resort shall grow.

Property renovation will include the makeover of 18 to 17 rooms (with 3 suites) andthe conversion of the present onsite property manager's house to lounge gatheringspace. New construction includes a bar room addition, extra parking lot build-out,and an outdoor pool. [Phase I capital (start-up) funds are documented later on in thisbusiness plan.] It is anticipated that the funding and transfer of this property willhappen in spring 1999. Operation "as is" of the facility would continue through thesummer and fall. The hotel will close for the winter months for its build-out and reno-vation.

Phase II

Continue implementation of sales, advertising, and marketing strategies developed in



Phase I. Identify and pursue additional guest markets, i.e. Internet room guaranteeservices. Seven Elms Resort shall evaluate its room occupancy position to determineif a facility expansion is warranted. Seven Elms Resort anticipates additional supportstaff would be needed at the proper time (Phase II). This Plan does not contain fund-ing needs for this Phase.

HOTEL & LOUNGE OVERVIEW

Establishing a hotel and lounge business clientele will take some time, as the researchrevealed word-of-mouth /recommendations /referrals and value as the primary wayin which hotel and lounge services are selected by new guests. People who are com-pletely new to the area, or who have few established connections, may look to theYellow Pages or other advertising to establish available services, then call for infor-mation or pricing.

A good portion of the past guests to the property will no longer return, as the presentownership has operated the property as a Christian retreat-style motel.

Competitive Advantage

Strengths of Seven Elms Resort, Inc. include Steve Blackburn's broad base of experi-ence in managing different types of companies. He has extensive development expe-rience and a track record of hiring the right people and training them. Blackburn un-derstands the service sector business, has traveled extensively frequenting numerouslodging establishments, and has gained invaluable experience in organizational man-agement.

Currently, a mid-size "boutique" resort niche is vacant in the Lake Michigan market,with present lodging on the high end, averaging $225 per night (and up) down to old-er motel properties of $79 per night. Several B&B establishments may fall into themiddle, however, Seven Elms, as a resort-style property, will serve its niche by itself.

Industry Keys to Success

1. A property designed for the guest and/or lounge patron2. Frequent Guest Award Program3. Controlled overhead and operational costs4. Regular and ongoing guest feedback



5. Latest technology/software capacity6. Weekend lounge (piano bar, dance floor) entertainment7. Unique, timeless and comfortable environment8. Dedicated management and associate support staff

MARKET ANALYSIS

Seven Elms Resort, Inc. like all businesses, is affected by forces and trends in the mar-ket environment. These include economic, geographical, competitive, legal/political,and technical.

Economic Environment

Positive forces include the generally prosperous economy that is currently in place,full employment, rising wages, and low inflation, leading more people to be able andwilling to spend money and to get away for some time. The close locality of LakeMichigan offers an affordable alternative to a flyaway destination.

Geographical/Competitive Environment

Located just two blocks from Lake Michigan and downtown Lakegrove, the area hasseveral golf courses, two ski hills, water recreation activities, numerous dining estab-lishments, various retail and specialty shops, art galleries, theatre entertainmentvenues, and the beauty and serenity of Lake Michigan, which has made this county afamous Midwest tourist destination. Traverse City began to prosper in the 1870s, be-coming a desirable resort area. Many homes and estates date back to this era and sev-eral enormous "summer cottages" were built on the lakeshore and are still in evidencetoday.

Seven Elms Resort shall fill a niche not presently available, namely a moderatelypriced (under $130 per night), resort-type establishment. Combined with an on-sitelounge, a grilled food service, an indoor and outdoor pool bar, and a morning conti-nental breakfast offering, we shall differentiate ourselves by becoming a "boutiquestyle" resort versus simply another motel.

Our Prairie Style surroundings will attract and retain guests who appreciate such re-fined environments.

Legal/Political Environment



Seven Elms Resort management will not move the project forward until it has ob-tained an option to acquire one of the 19 Benzie County, Michigan, liquor licenses. Asfaced by all businesses, the proper insurance needs shall be met and all operationsand policy manuals shall be reviewed by appropriate legal experts. The facility willobtain all the necessary building permits prior to construction. Present facility zoningallows for this proposed use, including a bar, cabaret, grill, and dance floor space.

Technology Environment

Computer programs greatly simplify the financial recordkeeping for today's busi-nesses. As a small business, Seven Elms Resort will need to watch its expenses close-ly. By utilizing the existing software packages available in the hotel industry, includ-ing: room and facility management database, controlled bar and inventory measuringsystems, and room key cards that allow patrons to charge directly to their roomaccount, this technology shall assist management in controlling costs, reducing cashmanagement, and maximizing revenue. Seven Elms Resort shall attract the resourcesnecessary to train and operate the system in order to generate the reports and man-age the inventory.

COMPETITIVE ENVIRONMENT

A listing of the hotel and motel properties in Benzie County, Michigan (sourcedthrough Midwest and the Ameritech Directories) is as follows. (Note: Other proper-ties on Lake Michigan, but outside the city limits, are not included):

High Line ($139-$750 per night, depending upon season)

The Cove of Lake Michigan ($145-$225)

Grand Michigan Resort and Spa ($139-$750)

The Harbor's Edge ($139-$199)

The Michigan Inn ($215-$350)

The Strike Hotel ($200)

Motel ($59-$119 per night, depending upon season)



Breezy Chateau Inn

Budget Time Motel

Lake Michigan Motel

Lakewood Motel

Misty Motel

Pine Tar Motel

Plaza Motel

Shady Drive Motel

The Stirrup Motel

Swiss Motel

Bed & Breakfast (B&B)

Dahlia House

The Mixer House

Precious Times Inn

Hotel and motel properties in adjacent communities are not listed, however, they doadvertise in the Yellow Pages.

Seven Elms Resort hotel and lounge is attempting to carve out a fourth segment inthe lodging market; that of a "boutique" style, high-line property at mid-line pricinggeared towards adult couples and not marketed to families.

A review of competitors' marketing strategies reveals no one targeting this marketsegment. Hotel and lounge is a referral-driven businessnew business can be ob-tained by encouraging and rewarding present guests to refer future guests. Network-ing within business and civic groups is important; even if the business results are notimmediately felt, it is an excellent public relations opportunity. Live piano, or jazzstyle trio, on the weekends will add excitement to the resort and draw community



residents and guests from other properties.

Market Research

A hypothetical behavior sequence model for a new customer (future guest) contem-plating using a hotel and lounge service for the first time might look something likethe following (based on discussions and interviews with potential guests):

Individual or couple decided to getaway for a few days. This may happen as a resultof a need for a change of pace, vacation, or a celebration purpose. The need can ariseanytime year round. Even in the late fall and winter months people are thinking "get-away" to break the weather doldrums.

Individual or couple investigates hotel services. In most cases, this means the theywill consider first any recommendations that they are knowledgeable of through pri-or association (relative, friend, or social group). If the individual or couple is new tothe area or otherwise has not made any close connections with people, he/she wouldlook in the Yellow Pages for a listing, or perhaps look in a newspaper for advertising.

Acting on the advice of friends (or own knowledge), the individual or couple will callthe recommended property to obtain information that will help him/her decide ifthis place is the best for them. Criteria for selection include: (1) amenities (pool, on-site food service, nonsmoking rooms, bar lounge area, etc.); (2) reputation (what kindof persons usually stay here?);(3) physical plant (how recent the renovation, upkeep,etc?); (4) courtesy (professional and attentive staff?); and (5) pricing (is the place af-fordable?).

Based on the information received, the individual or couple makes a decision and ei-ther schedules an appointment to view the property or makes a reservation.

The individual's satisfaction with his/her decision and with the service itself is large-ly a function of their interaction with the staff during their stay. Everyone associatedwith Seven Elms Resort will do everything possible to ensure a satisfactory experi-ence for the guest, so that future business (and a future referral) is not at risk.

Marketing strategies will build on this model, taking advantage of precipitatingevents, fostering word-of-mouth recommendations, and creating satisfaction throughinteracting with the future or present guests.



Summary of Opportunities and Threats in the Environment

Overall, the environment appears very positive for Seven Elms Resort, Inc. The forcesdriving market demand, mainly economic and geographical, are strong, with morepeople staying closer to home for shorter getaway trips and their comfort level of vis-iting Lake Michigan, one of the Midwest's premiere travel destinations. On the nega-tive side, there is competition, and it will take a while for Seven Elms Resort to get"established" in its market niche.

STRATEGY & IMPLEMENTATION

The business is driven by referrals and repeat business, so for the first few years Sev-en Elms Resort will need to be aggressive in attracting new guests. The marketingstrategy is subject to change upon guest feedback and surveys.

Marketing Strategies

Target MarketsGeographical: The major cities within a three-hour drive of theproperty.

Target Markets - Consumer:

New visitors traveling to the areaMiddle- and upper-income bracketReturning visitors to the areaBusinesses needing to hold small overnight planning and strategy sessionsArea wedding partiesCouples

Positioning and Product Strategy

For its guests, Seven Elms Resort will be positioned as a new, beautifully landscaped,nature-filled, unique atmosphere hotel with a bar lounge service that fits an adult"getaway" market niche. A full range of referral services (i.e. restaurant recommenda-tions, shopping, taxis, area attractions) will be made available and tailored to theneeds of the particular guest.

Business services range from room phones that are Internet jack ready and telephoneanswering message service for each room to on-site fax services and meeting room



space (lounge sitting area and cabaret room). Seven Elms Resort will aim to attractbusiness guests and their partners needing to hold planning or strategy sessionsaway from the office in a new and comfortable surrounding, in order to even out rev-enues throughout the week.

Distribution Strategy

Unlike products that are produced, then distributed, and sold, hotel and lounge ser-vices are produced and consumed simultaneously in a real-time environment. Thus,distribution issues center on making the services available in a convenient manner tothe greatest number of potential guests. Seven Elms Resort will maintain a front of-fice staff member throughout the night so guests are able to get answers to any ques-tion or service when they need it. This flexibility is especially attractive to the busi-ness traveler. Clients will be able to contact Seven Elms Resort by telephone, fax, ande-mail.

Pricing Strategy

Rooms per night fees have been developed. The fee schedule takes into account sea-sonal rates that are common in the area. For businesses and other large group func-tions, pricing can be discounted depending upon the number of rooms reserved.

Example lounge pricing and grill food offerings are also noted.

Example fees:

Room FeesWinter Rates (Novemberthrough April):Regular Rooms $109.00Suites $149.00Summer Rates (May throughOctober):Regular Rooms $129.00Suites $179.00(Includes Continental Breakfast, use ofindoor and outdoor pools, and exerciseequipment room.)Fax Service (per page, outgoing) $0.75Telephone Rates (set at goingcompany rate)Hotel Safe Storage Fee (per day) $2.50



Liquor and Drink Fees

(Sandwiches include fries, onion rings orchips.)

"Top Shelf" Brands $4.75 -$7.50Specialty Drinks $4.50 -$5.75Well Drinks $4.25Import Beers & Wine $3.75Domestic Beers $3.25Draft Beer $2.75Juices, Bottled Water, and Soft Drinks $2.50Grill MenuRib-Eye Steak Sandwich $7.99Chicken Breast Sandwich $5.99Hamburger (1/4 pound) $5.99Fried Cod Fish Sandwich $5.99Salads $4.99 -$8.99Chicken Tenders $4.99 -$6.99Cheese Sticks (with sauce) $4.99Frozen Pizza $6.99 -$8.99

Service and Support Philosophy

By giving careful consideration to customer responsiveness, Seven Elms Resort's goalwill be to meet and exceed every service expectation of its hotel and lounge services.Our guests can expect quality service and a total quality management (TQM) philoso-phy throughout all levels of the staff.

PROMOTION STRATEGY

Promotion strategies will vary depending on the target market segments. Given theimportance of word-of-mouth referrals among all market segments when choosing a"getaway" hotel or small business meeting location, our efforts are designed to createawareness and build referrals. A cost-effective campaignfocused on direct market-ing, publicity, our frequent guest reward program, and advertisingis being pro-posed.



Marketing Plan

New Business Segment

A direct marketing (direct mail) package consisting of a tri-fold brochure, letter of in-troduction, and reply card will be sent to a list of potential guests. This list can be ob-tained from International Business Lists, Inc. (Chicago, IL) and is compiled from taxrecords (by upper-income geographical areas, Secretary of State incorporation regis-trations, business license applications, and announcements from newspaper clip-pings).

The brochure and letter introduces Seven Elms Resort, stresses the importance of hav-ing a good time in comfortable surroundings, provides information on our resort ser-vices, and describes what sets us apart from other area hotel and lounge properties.The initial mailing may contain a promotional offer: the opportunity to receive a 10%discount on the first night's room rate.

Approximately two months after the mailing, an additional letter shall be sent. Thepotential guest would be asked to address any questions and the follow-up would re-mind them to drop in for a property tour on their next trip to Lake Michigan. Addi-tionally, new businesses will be targeted and sent information.

The cycle would repeat itself with new target communities and select businesses andwould continue through the first year. After that, additional mailings would be con-ducted, as needed, based upon occupancy goals.

Seven Elms Resort, Inc. will also consider developing a one-page newsletter to bemailed quarterly to past guests and prospects in the database. The newsletter can beused to update clients on hotel and lounge and area-related developments, but alsoserves as a reminder of what sets Seven Elms Resort apart. The newsletter can be pro-duced in-house and for the cost of paper and a stamp creates a lot of goodwill amongguests and business prospects.

Publicity and Public Relations

A news release will be sent to area newspapers and magazines announcing thelaunch of Seven Elms Resort, Inc. and lounge. Area talent searches will be conductedto secure weekend cabaret room entertainment.



Steve Blackburn will join the Benzie County Chamber of Commerce as a means ofnetworking in the community. He also may make himself available for speaking en-gagements at other community or civic organizations as a low-cost way of increasingawareness and building goodwill in the community.

Guest Reward Programs

For present guests: "Stay 6 nights and get the seventh night for free" promotion andas a means of building business by word-of-mouth, present customers should be en-couraged and rewarded for referring future guests. This can be accomplished by of-fering a small "rebate" (5% or 10% rebate on first night stay) to current customers whosuccessfully refer a new guest.

Advertising

Advertising is utilized primarily to attract new guests and serves to build awarenessand name recognition of the resort in general, which is important for word-of-mouthreferrals ("Oh yes, I've seen that resort's ads before.")

Periodic advertising in target market area newspapers will afford Seven ElmsResort, Inc. name recognition benefits. From quarter page ads announcing its en-tertainment line-up to business card-sized logo ads.Yellow PagesAmeritech PagesPlus, Greater Benzie County Telephone Directo-ry. Research indicated that new visitors or people who don't have many person-al acquaintances to ask about hotel and lounge services will look to the YellowPages to establish a list of potential hotel and lounge services to call. Even asmall 2" 2" boxed ad can create awareness and attract the desired target client,above and beyond the ability of a simple listing. Ameritech Yellow Pages coversthe relevant market area, delivering over 30,000 copies to residents and business.Midwest Directories covers Greater Benzie County but is considered a second-tier directory to Ameritech.Telephone Book Cover. A business card-like ad on the plastic cover which isplaced over any telephone book enables the business name/logo to be seen vir-tually 24 hours a day, 365 days a year. Covers are distributed bi-annually free ofcharge to residents and businesses in Benzie County.Restaurant PlacematsOpportunities exist for a business card-like ad to beplaced on the paper placemats used in area restaurants (shelf-life of the ad is



about six months), or for special (holiday) events taking place at a restaurant (1-off opportunities). An example would be getting on the area restaurant place-mats (about 9,000 in six months), or getting on the special Lions Club "St.Patrick's Day" dinner placemats at the Village Restaurant (about 1,000 placematsfor that event). Placemat advertising will reach area residents as well as area vis-itors/tourists staying at other places.Additional places to post flyers/business cards or for a business card ad includebulletin boards in public buildings (grocery stores, senior centers), and playbillsfor local theater groups.

Example Promotion Budget - 1999 (Amounts Included in Start-Up Funds)

Resort brochure (2-color, 1,000 quantity, high quality paper) $750Reply card (2-color, 500 quantity, card stock) $250Lists (new businesses, home-based businesses) $750Postage (mailing 450 pieces) $500Restaurant placemats (5 restaurants/10 events) $500Newspaper advertising $5,000Yellow Pages $2,000Advertising specialties (give-away) $250Total for 1999 $10,000

Evaluation & Control Strategies

Objectives have been established for Seven Elms Resort so that actual performancecan be measured. Thus, at the end of its first year, Seven Elms Resort should have:

$772,000 in total revenueAnticipate 57% occupancy rating

Each subsequent year new objectives will be set for these benchmarks and actual per-formance will be measured against them. If actual performance falls short of objec-tives, investigation will be made into the cause, and plans will be adjusted according-ly.

In addition, it is recommended that Seven Elms Resort keep track of the source of allnew guests ("Where did you hear of us?") in order to measure the effectiveness ofeach type of promotion. Each subsequent year's budget should adjust spending to-ward the types of promotion that reach the most new clients.



Customer satisfaction is most directly reflected in the year-to-year customer retentionpercentage. All lost customers should be investigated to find out why they left. A cus-tomer satisfaction survey may be considered after three to four years in the business.

FINANCIAL PLAN

Here is the Project Funding Summary for Seven Elms Resort:

Project Funding SummaryBuilding and Improvements Cost $881,000Fixtures, Build-Out and Furniture $353,739Developmental Start-Up Expense $116,000Five Months Working Capital $49,261Total $1,400,000

Phase 1 Funding Amounts Sought

Developmental costs for the start-up of this new hotel and lounge services companyare listed above. These schedules also listed in the Ten Year Proforma.

The following schedule highlights the anticipated developmental costs:

Classification: CostLiquor License $71,000Architect Fees $7,500Accounting $1,500Marketing, PR & Advertising $10,000Engineering & Permitting $5,000Office Expense $2,000Founders Draw (Gen. Contractor) $16,000Legal $3,000Total $116,000

The development of Seven Elms Resort, Inc. will require the full-time talents of SteveBlackburn. Phase II growth amounts will be developed and sought at a later date,based upon needs to be determined at that time.

Financial Plan Assumptions

The following assumptions will be incorporated into Seven Elms Resort, Inc. profor-ma statements.



All operating costs are based on Seven Elms Resort, Inc. management researchof similar operating companies.Automated informational and bar control systems will reduce Seven ElmsResort, Inc. staff requirements.Developmental start-up costs are amortized over a five-year period.Room Occupancy Rate at 57%, G & A overhead and operations costs are calcu-lated on an annual basis.Property manager and founder's salary is based on a fixed salary expense basis.All fixed and variable labor costs should rise annually at 2.5% per year.All revenues are figured to rise annually at five percent. Fixed annual, adminis-trative, and office expenses rise at an annual rate of one half of one percent.

RESUME

This is the resume of Steve Blackburn, the future owner of Seven Elms Resort SteveBlackburn has demonstrated experience in business and sales organization develop-ment. Developed and secured funding for own organization, author of several suc-cessful RFPs, business and market development plans. Has expertise in customer re-tention programs, sales training seminars, project planning, benchmark analysis, andforecasting and budgeting. Designed and implemented computer applications includ-ing: customer database service frequency schedules, truck routing, customer reten-tion surveys, accounting and commission salary programs.

EMPLOYMENT HISTORY

University of Michigan, Ann Arbor, Michigan Small Business Development Center 1996-present

As a United States SBA counselor I assist clients in sales and business developmentand other related matters including: Sales, Marketing, Manufacturing and Productivi-ty Analysis, Regulations Compliance, and Regulatory Program Development.

MRT Environmental, Inc., Cleveland, Ohio 1992-1995

Co-founder, Business Development, Marketing, and Sales. A consulting and facilitiesdevelopment organization for environmental services clients in the health care indus-



try. My responsibilities included: development of project opportunities and clients,sales personnel and training, advertising and promotion, and financial record keep-ing.

Pride & Barrow Industries, Inc., Dallas, Texas 1985-1992

Vice President - Sales and Development. $80 million subsidiary of a $3 billion publiccompany. Created the new medical services division; integrated third year revenuesexceeded $4.5 million and employed over 25 employees. Market development and di-rect sales management for all regional special services subsidiaries. Developed re-gion's first comprehensive medical waste service organization by identifying andmarketing to the healthcare industry an emerging service bundle of packaging, trans-portation, in-service training, and treatment of medical wastes. Serviced all sectors ofthe healthcare industry from physician offices through major medical centers.

Market Development Representative and Environmental Specialist. Analyzed newbusiness development opportunities in all service areas. Municipal waste contracts,waste company acquisitions, landfill development, and expansions and ancillary spe-cialty services. Responsible for training, sales functions, regulatory data submittal,and special waste stream permitting. Created computer applications and processingsystems to maximize efficiency and minimize errors.

Education

University of Michigan, 1998, M.B.A. candidate.

Notre Dame University - Graduated 1985. B.A. in Business Accounting and Econom-ics. Completed a course of study for a B.S. in Chemistry.

96811714 Hotel Resort Business Plan Executive Summary Company Summary Market Analysis Competitive...

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