PEGASUS TRAVEL.COM:FASTEN YOUR SEATBELTS!

Presented by:Jigar PatelAnkit PatelNikhil ChandPooja VelinkerManthan Gajjar

FLOW OF PRESENTATION

• INTRODUCTION• INDUSTRY OUTLOOK• COMPANY QVERVIEW• SERVICE THEY ARE IN• BACKGROUND OF

ENTERPRENEUR• ORGANIZATIONAL CHART• BOARD OF ADVISORS• ORGANIZATIONAL PLAN• TARGET MARKET• COMPANY RESOURCES• OPERATIONAL PLAN• POTENTIAL COMPETITORS

• MARKET SEGMENTATION• MARKETING PLAN• MARKETING STRATEGY• DIFFERENTIATION STRATEGY• SWOT ANALYSIS• PEST ANALYSIS• 7’S• RISK FACTORS• FINANCIAL ANALYSIS• ESTIMATION• SNAPSHOTS OF WEBSITES

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INTRODUCTIONINTRODUCTION

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INDUSTRY OUTLOOK

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The travel and tourism industry is a leader in E-commerce On-line sales of travel surged over 200 percent in 2001 increasing from

$3.1 billion to $8 billion in 2001 Expected to generate almost three times as much revenue as originally

predicted, surging to $20 billion in 2002 Total travel spending is forecast to grow 4.2 percent annually, increasing

from $502 billion in 1998 to $630 billion in 2003. The primary transportation sectors in the travel and tourism industry are

airlines, rental cars, railways, and cruise lines.

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Tourism in the United States is a large industry that serves millions of international and domestic tourists yearly

Tourists visit the US to see natural wonders, cities, historic landmarks and entertainment venues.

Americans seek similar attractions, as well as recreation and vacation areas

Tourism in the United States grew rapidly in the form of urban tourism during the late nineteenth and early twentieth centuries

By the 1850s, tourism in the United States was well-established both as a cultural activity and as an industry

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• New York, Chicago, Washington D.C and ,San Francisco all major US cities, attracted a large number of tourists by the 1890s

• By 1915, city touring had marked significant shifts in the way Americans perceived, organized and moved around in urban environments

• Democratization of travel occurred during the early twentieth century when the automobile revolutionized travel

• Similarly air travel revolutionized travel during 1945–1969, contributing greatly to tourism in the United States

• By 2007 the number of international tourists had climbed to over 56 million people who spent $122.7 billion dollars, setting an all time record

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The travel and tourism industry in the United States was among the first commercial casualties of the September 11, 2001 attacks, a series of terrorist attacks on the US

Terrorists used four commercial airliners as weapons of destruction, all of which were destroyed in the attacks with 3,000 casualties

In the US, tourism is either the first, second or third largest employer in 29 states, employing 7.3 million in 2004, to take care of 1.19 billion trips tourists took in the US in 2005

As of 2007, there are 2,462 registered National Historic Landmarks(NHL) recognized by the United States government

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• As of 2008, the most visited tourist attraction in the US is Times Square in Manhattan, New York City which attracts approximately 35 million visitors yearly

• The travel and tourism industry in the United States was among the first commercial casualties of the September 11, 2001 attacks, a series of terrorist attacks on the US

• Terrorists used four commercial airliners as weapons of destruction, all of which were destroyed in the attacks with 3,000 casualties

• In the first full week after flights resumed, passenger numbers fell by nearly 45 percent, from 9 million in the week before September 11 to 5 million

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Hotels and travel agencies received cancellations across the world The hotel industry suffered an estimated $700 million loss in revenue

during the four days following the attacks The situation recovered over the following months as the Federal

Reserve kept the financial system afloat. The U.S. Congress issued a $5 billion grant to the nation's airlines and $10

billion in loan guarantees to keep them flying In the US, tourism is either the first, second or third largest employer in 29

states, employing 7.3 million in 2004, to take care of 1.19 billion trips tourists took in the US in 2005

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• The US outbound holiday market is sensitive in the short term, but possibly one of the most surprising results from the September 11, 2001 attacks was that by February 2002 it had bounced back for overseas travel, especially to destinations like New Zealand

• This quick revival was generally quicker than many commentators had predicted only five months earlier

• The United States economy began to slow significantly in 2007, mostly because of a real-estate slump, gas prices and related financial problems

• Many economists believe that the economy entered a recession at the end of 2007 or early in 2008.Some state budgets for tourism marketing have decreased, such as Connecticut which is facing soaring gas prices

ForecastThe U.S. Department of Commerce forecasts:

(in thousands)

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Origin 2007 2008 2009 2010 2011

Canada 16,691 17,274 17,847 18,409 18,960

Mexico 13,717 14,127 14,529 14,921 15,304

Europe 10,951 11,407 11,822 12,230 12,632

Asia 6,348 6,710 7,050 7,390 7,730

South America

2,166 2,267 2,367 2,466 2,564

Caribbean 1,277 1,316 1,355 1,394 1,431

Central America

737 768 798 829 860

Oceania 804 838 872 905 937

Middle East 600 622 644 666 688

Africa 270 282 294 306 317

American Tourism Society

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For the past 20 years the American Tourism Society has been providing exclusive access and business networking for transformational destinations

ATS is an organization of experienced tour operators, destination tourist offices, hotels, airlines and other travel industry professionals who collectively generate over four billion dollars in sales involving three million North American travelers

Marked by the fall of the Berlin Wall, the end of the Cold War and a reunified Europe

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• The American Tourism Society (ATS) was founded as a non-profit, non-political destination marketing organization during one of the most challenging years in modern history, 1989.

• By merging business know-how with the core values of sustainable tourism, ATS serves as abridge of communication and understanding between countries and peoples of the world.

• ATS lends priority access to internationally known travel companies through overseas conferences, travel marts and seminars in regions of interest to ATS and its members.

• Additionally, ATS organizes showcases for these regions in the U.S.

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Through its collective expertise of enterprise, marketing, educational initiatives and promotion, ATS provides visibility in trade publications and networking among tourism interests.

ATS also maintains reciprocal memberships with other industry organizations such as the United States Tour Operators Association and the Baltic Tourism Commission.

ATS works for its membership - here and abroad - as an indispensable link to government agencies.

From branding to product development, ATS is a reference point for travel-related companies seeking access to the North American market

SERVICES THEY ARE IN

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Services will include a web site where customers can create their own customized vacation package or choose from the pre-set travel packages of the week and chat with people who are also interested in traveling with them.

Customers will also be able to locate travel buddies if they have an idea of a destination, but do not have a large enough group for traveling.

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Sandrine Bouchet

Kimberly Peters

J. H. WelchChrista Bentley

Yoriko Nomo

BACKGROUND OF ENTREPRENEUR

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Kim PetersKim Peters

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Kim Peters was born in Amherst, Massachusetts and graduated near the top of her class at Amherst High School.

She is currently earning a general management degree in marketing and human resources.

She has worked in a variety of organizations, ranging from small entrepreneurial firms (Mann & Co.) to large corporations (The American Red Cross).

She has experience in customer service and promotions. As president of the Company, Kim will be responsible for strategic

development, hiring, firing, major asset acquisition, and capital expenditure decisions.

Her day-to-day activities will involve establishing corporate partnerships, training and supervising employees, and dealing with major customer service problems.

Christa Bentley – Finance and Christa Bentley – Finance and Accounting ManagerAccounting Manager

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She was born in Sydney, Australia and is currently earning her Bachelor’s degree in Finance and Marketing at Boston College.

Through her coursework and academic experience, she has acquired knowledge on the various aspects of finance.

Her employment in the largest bank in Singapore helped her develop her analytical skills.

Responsible for finance, accounting, payroll, billing, taxes, check signing, and any other matters related to sales and revenue budgets.

She will also be in charge of the financial statements and be responsible in choosing an appropriate accounting firm

Jack H. Welch – Public Relations/Information Jack H. Welch – Public Relations/Information Technology ManagerTechnology Manager

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He worked in the John Hancock Agency in Boston as a Management Information System Intern.

He responsibility as a public relations manager include overseeing the customer service aspect of the Company.

He will be in charge of handling customer complaints and the hiring of customer service representatives in the future.

He will develop the customer service toll-free hotline that will be introduced.

Yoriko Nomo – Marketing and Sales Manager

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Her experience of serving customers, arranging trips, making reservations, and issuing tickets over the computer will enable the firm to efficiently start its operations.

She has three months of experience as a registration representative at Sky Perfect TV in Japan, where she assisted customers with registration over the phone and supported them with the appliances’ technical problems.

Sandrene Bouchet – Administrative Manager

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She is currently on exchange at Boston College from a business school in France.

Her courses include Introduction to Marketing, Statistics, International Marketing and Entrepreneurship.

Her work experience includes a stint at Cora Supermarket where she was in charge of sales analysis in the food department

Her responsibilities include the hiring and firing of employees as well as training and supervision.

She will also handle all purchases needed for the office

ORGANIZATIONAL CHART23

Kimberly PetersPresident

Board of Board of AdvisorAdvisor

Christa Christa BentleyBentley

FinancialFinancial

Yoriko NomoYoriko NomoMarketing Marketing ManagerManager

J. H. WelchJ. H. WelchPR/IT PR/IT

ManagerManager

Sardrene BouchetSardrene BouchetDirector of Director of

AdminAdmin

Customer ServiceCustomer Service

BOARD OF ADVISOR

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Mr. Henry Chuang Professor Maria Sannella Professor Mary Cronin Courtney Wark

ORGANIZATIONAL PLAN

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Pegasus will be established as an S-Corporation. The principal shareholders will each assume an equal stake in the

business. A significant advantage of the S-Corporation is the ability to avoid double

taxation. The other benefit from being an S-Corporation is that the shareholders

retain the limited liability protection of a C-Corporation. Shareholders are only liable for the amount of their investment.

TARGET MARKET

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• Pegasus targets the senior population (55 years old and over).• Seniors tend to have more money and time, and travel more for leisure

purposes. • The number of seniors using the Internet is expected to increase

substantially in the near future. • The actual number of seniors however will be exploding, as the baby

boomers move into this range.• Reports indicate seniors spend 8.3 hours per week online, even more than

the average college student. • Older Internet users have and use the most credit cards, presents Pegasus

with major opportunities for growth and high returns.

OPERATIONAL PLAN

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WEBSITEWEBSITE

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The operational plan includes the business model of Pegasus and also their journey from idea generation to receiving revenue at the end of 1 year.

Process Flow

Reservation Agency

Pegasus Travel

Sales Representative

s

Commission distributionCommission

Pay Charg

es

CONTD…

COMPETITORS

Traditional travel agencies Online travel agencies Airlines

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TRADITIONAL TRAVEL AGENCIES

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• It provide travel information and tour bookings to their customers mostly through the phone, and face-to-face meetings.

• While traditional travel agencies do not offer “24 x 7 access,” they are making up for this disadvantage by providing the “personal touch” that the Internet does not provide.

• The Financial Times reported that 62% of every dollar spent by the U.S. web shoppers is going to brick and mortar retailers that have online operations.

• NPD Online Research revealed that 56% of on-line travelers reported having completed reservations with a traditional agent after visiting a travel-related site.

CONTD…

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Sales growth to decrease due to the advent of Internet travel resources, The traditional travel agency has had a compound average growth rate of

6% over the past few years.

CARSLON WAGONLIT TRAVEL

http://www.carlsonwagonlit.com/en/

AMERICAN EXPRESS

WORLD TRAVEL

TRADITIONAL TRAVEL AGENCIES

Provide more personalized service Seeing increase in number of referrals

from online travel agencies Provide a sense of security that the

Internet cannot Provide research and booking services

for customers. Consumers prefer to book tours through traditional travel agencies.

Revenue declining, as more and more travelers migrate toward online services

Commission cuts by airline companies

Charge high booking fees to pay overhead expenses

Do not offer 24 x 7 customer access

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STRENGTH WEAKNESS

ONLINE TRAVEL AGENCIES

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• It provide travel planning on the Internet, enabling the consumer to compare costs and services at an easier, quicker pace.

• Most people use the Internet as the essential tool for acquiring travel information.

• It offer the consumer the convenience of 24-hour access and flexibility.• Online travel can be broken down further into three categories:•

– Full-service – Name-your-price– Umbrella agents

● Travelocity.com● Expedia.com● Amadeus.com● Priceline.com

● Cheaptickets.com

● EGulliver.com● iwant.com ● respond.com

TRAVELOCITY.COM

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http://www.travelocity.com/resolve/in

FULL SERVICES

EXPEDIA.COM

AMADEUS.COM

PRICELINE.COM Name your price

CHEAPTICKETS.COM

IWANT.COM Umbrella agent

RESPOND.COM

ONLINE TRAVEL AGENCIES

• Ability for traveler to choose different air fares at reduced prices

• Low start-up costs• Most frequently used e-commerce

service on the Internet• Offers other services such as

personalized weather reports, stock quotes and airline-specific “fare alerts”

• Low overhead costs• In1999 online travel revenues

accounted for more than 30% of all B-to-C revenues

• Large untapped market potential in Europe, Asia and Latin America

• Difficult to automate personalization and “human touch” with the efficiency of the Internet

• Takes considerable time and energy to effectively research all the best online fare options

• Online credit fraud is a major concern of Internet users

• Requires consumers to be Net savvy• Although 45% of all vacation travel is

now researched on the Net, only 4%of sales are actually booked online

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STRENGTH WEAKNESS

AIRLINES

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• An adopting a combination of traditional, and online travel agent services. • Airlines sell their tickets directly to the consumer, bypassing service fees

that the agencies charge.• The customer might not have as much flexibility in choosing among

different fares, airlines reward customers for their loyalty through perks such as frequent flyer programs.

• Airlines are concerned with organizations such as Priceline and Travelocity, who are luring away many customers,

• It have retaliated by forming an alliance named Hotwire.com. Hotwire sells discounted airfares for “distressed seats,” seats that are still empty at the last minute

U.S AIRWAYS

AMERICAN AIRLINES

UNITED AIRWAYS

AIRLINES

• Offer both traditional and online services

• Established brand name• Ability to offer unsold seats at a

very low and competitive price• Do not charge extensive service

or booking fees associated with traditional Travel agents

• Increasing use of e-ticketing

• Customers have little or no loyalty to a particular airline

• 60% of carriers identified their own web site as the most important element of their online presence, but only 50% of these airlines actually sold tickets electronically

• High overhead (i.e. selling and marketing expenses)

• Heavily relies on travel trade to sell about 85 % of its tickets

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STRENGTH WEAKNESS

MARKET SEGMENTATION

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MARKET SEGMENTATION

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PRICE AGE PURPOSE FOR TRAVEL

The Travel and Leisure Industry

PRICEPRICE

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One of the important factor as it influences a consumer’s travel choices. Customer will expect the value for the price paid. Customer opts for an expensive tour, he/she will expect better hotels,

superior customer service. Lowest possible price will forgo the extra frills.

AGE

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A second factor which influences market segmentation is the age of the customer.

On the basis of age the marketing strategy and type of products and services to be offered also gets decided.

The age range of the travel industry is large, ranging from college students to retirees.

For example, a tour agency targeting college students might advertise low priced tours at locations such as Cancun and Jamaica for spring break.

On the other hand, business oriented agencies might reach their customers by the quality of accommodation and services provided.

PURPOSE OF TRAVEL

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LEISURELEISURE

BUSINESSBUSINESS

Incorporate tourist attractions and sightseeing activities in their toursIncorporate tourist attractions and sightseeing activities in their tours

Aim is to allow the customer to enjoy their holiday and transportation with

the business traveler in mind.

Aim is to allow the customer to enjoy their holiday and transportation with

the business traveler in mind.

MARKETING PLAN

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Goals and Objectives The short-term goal of the Company will be to reach $1 million in gross

sales in the eighth month Approximately $1.8 million by the end of the first year Pegasus predicts to have losses in the first three years of its operation, but

with later entry into the European market, will achieve profits of approximately $700,000 in year five

CONTD…

$29 billion consumers are expected to spend in online travel and tourism, Pegasus’s goal will be to achieve about .01% of that number for its market share

Seniors and baby boomers amount to 55 million people Pegasus expects to have market penetration of .02% or 11,000

customers after three years of operation Market increase steadily at a growth rate of 5% each year Marketing strategy and promotion program section, Pegasus will partner

with info-mediary services such as e-How and Yahoo in its first year of operation

CONTD…

With the help of these partnerships, the Company plans to have a distribution network covering approximately 45% of the market

The Company also seeks to create an awareness level index of 65% by the third year of its operation

Company will outsource its web site development, and operation, to a more experienced and professional web company

Pegasus will also receive a sales commission of 8.5% on every transaction that is made by each of its agents

Media campaign will cost Pegasus about $1 million in the first year

SWOT ANALYSIS

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STRENGTHS

The firm’s offering of both online and “face-to-face” customer service 24-hour service is important in achieving a competitive advantage Targeting a specific market Alliance with travel agencies in Europe Employees are capable of speaking more than one language

WEAKNESS

Lack of a partnership with an airline The firm to demand immediate payments to customers before the airfare

increases The firm anticipates operating only one retail location initially, customers

who prefer “face-to-face” service might have to visit the office directly

OPPORTUNITIES

Large market potential The Company is focusing on the domestic market, having a strategic

alliance with other travel agencies around the world Pegasus will broaden its services to include event packages such as

anniversaries, wedding vow renewal opportunities, and birthday packages to meet the demands of the market

THREATS

Health of the economy Political and economic status of the countries The growth and profits in the industry makes it lucrative for other players

to enter the market

SERVICE DEVELOPMENT STRATEGY

Highly customized 24-hour customer service support as well as a package containing

emergency contacts and guidebooks To provide value-added services, which cater to a specific target market

with a definite set of needs

CUSTOMER SERVICE

Provide a unique Emergency Customer Service hotline number Hire employees who are specifically trained to cater to customer needs in

an emergency situation

PRICING

Company will price the tour package competitively without compromising quality

25% markup on the entire package For example, a trip to Rome might cost $10,000 and Pegasus will then

charge $12,500 to the customer

DISTRIBUTION

Distribution channel begins when it receives the airline tickets, car rental, and hotel bookings from a fare listing service

The confirmation is immediate, and the ticket can be printed out After the relevant documents have been obtained, Pegasus will compile

the package for the customer Package mailed to the customer

PROMOTION

Market to customers online through advertisements on specific sites The web sites most used by seniors will be targeted Television will be utilized The Travel Channel will provide a great outlet to reach the target market $40,000 in the first month advertising on the Travel Channel $10,000 will go into the travel section of the New York Times and USA

Today $2,000 towards banner ads on senior.com Every winter Pegasus will focus its advertising strategy on television, and

concentrate on print ads in the summer

SHARED VALUE

STAFF

STYLE

STRUCTURE

SKILLS

STRATEGY

SYSYTEM

7 SERVICES

7’S

STAFF

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Kimberly Peters – President Christa Bentley – Finance and Accounting Manager Jack H. Welch – Public Relations/Information Technology Manager Yoriko Nomo – Marketing and Sales Manager Sandrene Bouchet – Administrative Manager

SKILLS

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Technology Unique service model

STRUCTURE

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Centralized organizational structure

STRATEGY

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Providing online support along with traditional support that is solving query if any by meeting face to face.

Customized package Partnering with info- mediary services such as e-How and Yahoo. Providing with the facility of chat with other customers and feedback

system at the end.

SYSTEM

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The development of specific processes, procedures or information systems to support online marketing.

Fully online based and in the interest of the customers.

STYLE

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Online travel servicing. Working also as an intermediary among reservation agents and

customers who want the tour packages.

SHARED VALUE

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Travel agency that caters to the needs of people aged 55 and above. Online web site in which customers can search and browse. There will also

be a chat room that will list the pre-set travel-of-the-week package from Pegasus.

The package will also be adaptable to a customer’s needs, in terms of time, destination and entertainment.

customer logs in with his or her username and password, a customer will be able to chat with others to collect information prior to booking.

CONTD…

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Website offer a discussion board where customers can post a request to find travel buddies, for travel ideas which are different from the pre-set package.

The space to incur a reasonable rent expense. Place has adequate space for computers, printers and also contains a

guest room where customers can share their opinions personally with a travel agent.

PEST ANALYSIS

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POLITICAL FACTOR

According to the findings, political environment of is quite stable.

Issues like enlargement of war against terror have had an effect on the political stability of the government.

In result of growing awareness of the environmental consequences, USA Government is planning actions to ensure aviation reflects its environmental impacts.

Proposals are emerging for a tax on aviation fuel and VAT on air tickets. Government’s taxation policies and decision about the increasing the

petrol prices have affected the buying power of the individuals in USA.

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ECONOMIC FACTOR

Economic factors affect the purchasing power of potential customers and also affect the individual company’s offerings.

USA economy is benefiting form gradual low inflation rate. In USA, unemployment is low. Job confidence is high and because of this

confidence spending by consumer is also high. Exchange rates are favorable for USA residents for travelling abroad

due to strong position of US dollar against the other foreign currencies.

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SOCIAL FACTOR

A trend of internet access at home and buying online is very high in the USA.

Continued concerns over safety and security while travelling are found in the USA residents.

Lifestyle changes have also been affecting the USA travel market for a number of years.

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TECHNOLOGICAL FACTOR

Changes in the technology have changed the way businesses operate i.e. Internet booking for tickets and holidays.

Faster changing development in technology creates a need to react quickly for different businesses in order they want to maintain the competitive environment by providing the same innovative services, which their competitors are offering.

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RISK FACTORS

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Any unexpected changes in the economy. Government deciding to regulate Internet companies or on-line travel,

due to concerns over security. If fraud gets out of control, or if airline security gets compromised new

regulations could increase costs, or force serious changes in Company operations.

Trouble in popular vacation sports, such as the conflict in Israel, will affect travel choices and possible revenues.

The devaluation of the dollar could also be a significant problem.

COMPANY RESOURCES

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The office will be located on 1675 Beacon Street. Pegasus decided to lease the space to incur a reasonable rent expense. The business will require:

Employees

Personnel

Web designers and Web developers The equipment that will be needed for this business will be purchased, in

order to avoid overpriced equipment leases.

FINANCIAL ANALYSIS

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START-UP FUNDING

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• The initial investment of $2,105,185 will be acquired through venture capitalists and bank loans, which will be paid off over 12 years.

• The invested money from venture capitalists and bank loans will allow Pegasus Travel, Inc. (“Pegasus”) to cover office space, office equipment and supplies, advertising, technology development, salaries and wages and utilities.

• Given the low capital intensive nature of the business, the Company’s start-up costs and working capital are less than other e-commerce ventures.

• The Company is willing to offer a reasonable portion of equity to attract investors.

INCOME STATEMENT

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Year 1 Year 2 Year 3

Sales 100% $1,765,650 2,295,345 2,983,949

Less: COGS 50% $882,825 1,147,673 1,1491,974.50

Gross Profit 50% $882,825 1,147,673 1,1491,974.50

Operating Expenses

Selling Expenses 40% $706,260 734,510 771,236

Technology Development 28% $494,382 533,933 555,290

Advertising Expenses 20% $353,130 459,069 596,789

Salaries, Wages 29% $512,039 584,039 680,039

Office Supplies 1% $10,000 13,083 16,415

Rent 1% $16,652 17,651 18,710

Utilities 1% $594 689 776

Insurance 1% $8,828 8,828 8,828

Depreciation .19% $3,300 4,361

Total Operating Expenses 119% $2,105,185 2,356,163 2,653,752

Profit (loss) before taxes -70% ($1,222,360) -1,208,491 -1,161,777.50

Taxes -1% $16,244 21,117 27,452

Net Profit (loss) -70% ($1,238,604) -1,229,608 -1,189,229.50

ANALYSIS

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• They have assumed equal figures in all the 3 years.• Selling expenses have been incurred heavily in 1st year and it goes on

increasing till 3rd year followed by salary and wages.• Advertisement expenses also goes on increasing which shows that they

will heavily spend on advertising in the initial years in order to spread awareness.

• Depreciation is not provided in 3rd year which we assume that may be their assets would have to be replaced or to be purchased new as the old one becomes useless.

• Insurance charges are same for 3 years.

CONTD…

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Operating expenses have increased much beyond the profit in all the 3 years as their all expenses show increases in all 3 years. This means that in initial years their aim is to spread awareness, attract more customers and differentiate themselves from others.

In the initial 3 years they have not been able to cover the expenses incurred and therefore are incurring losses for 3 years.

Even when they are incurring losses they have paid taxes which does not digest us.

MONTHLY INCOME STATEMENT

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Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

Sales 130 103 133 140 147 159 162 179 137 156 154 166

Less: COGS

35 22 41 61 65 85 102 114 82 92 86 98

Gross Profit

95 81 92 79 82 74 60 65 55 64 68 68

Operating Expenses

Selling Expenses

85 60 32 40 60 47 323 40 62 81 82 84

Advertising Expenses

62 19 18 41 43 28 24 23 25 10 29 31

Salaries, wages

40 38 38 38 41 41 41 52 40 53 45 45

Office Supplies

1.6 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 1.4 0.7 0.7

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Rent 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.8 1.8

Utilities 0.04

0.04 0.04 0.04 0.04 0.09 0.09 0.04 0.04 0.04 0.04 0.04

Insurance 0.6 0.6 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.8 0.8

Taxes 1.2 1.2 1.3 1.3 1.3 1.3 1.4 1.4 1.4 1.4 1.5 1.5

Depreciation

0.27

0.27 0.27 0.27 0.27 0.27 0.27 0.27 0.27 0.27 0.27

Ttl Operating Expenses

204 124 95 124 126 164 118 125 131 149 161 165

Profit (Loss) before tax

(109)

(43) (3) (45) (44) (90) (58) (60) (76) (85) (93) (97)

Taxes 0 0 0 0 0 0 0 0 0 0 0 0

Net Profit(loss)

(109)

(43) (3) (45) (44) (90) (58) (60) (76) (85) (93) (97)

ANALYSIS

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Pegasus forecasts its first year sales to be 5% with projected increases of 30% per year as they are spending heavily on their promotional activities.

The Company budgets 20% of sales for advertising, in order to attract travelers and increase market share.

The Company assumes that most sales will occur in August and December, as seniors are most flexible with their travel plans and the best fares are offered by the airlines during these months.

Cont…

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Though sales are at peak in this 2 months the cost of goods sold is also high in these months that means though sales has increased it has Nov. contributed to the profit much.

Selling expense incurred in the month of July is very high and inspite of incurring such a high amount theirs no major impact seen in sales in the coming months

CASH FLOW STATEMENTCASH FLOW STATEMENT

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Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

Receipts

Sales 91 111 124 138 145 155 161 174 150 150 157 162

Disbursements

COGS 28 25 37 57 64 81 99 112 88 90 87 96

Selling Expenses

42 73 46 36 50 54 40 37 51 72 82 83

Salaries 40 38 38 38 41 41 41 52 40 53 45 45

Advertising 62 19 18 23 43 41 24 28 25 10 29 31

Office Supplies

0.96 1.1 0.7 0.7 0.7 0.7 0.7 0.7 0.7 1.1 0.9 0.7

Rent 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.8 1.8

Utilities 0.04 0.04 0.04 0.04 0.04 0.04 0.09 0.04 0.04 0.04 0.04 0.04

Insurance 0.48 0.6 0.68 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.8 0.8

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Taxes 0.84 1.2 1.3 1.3 1.3 1.3 1.4 1.4 1.4 1.4 1.5 1.5

Ttl Disbursement

175.6 159 143 158 202 140 208 233 208 229.5 248 259.8

Cash Flow

-84.6 -48.2 -19 -20 -57 15 -47 -59.2 -58.1 -79.5 -91.04 -97.8

Beg. Balance

0 -19 -32.3 -10.3 12.8 47.8 16.9 80 140 198.3 277.8 368.9

ESTIMATION ESTIMATION

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• Pegasus predicts to have losses in the first three years of its operation, but with later entry into the European market, will achieve profits of approximately $700,000 in year five.

• The Company will also plan to exploit the anticipated growth of the European market by capturing another .01% of market share, thus reaching $10 million in total gross sales revenue by year five.

• The Company will outsource its web site development, and operation, to a more experienced and professional web company.

• Pegasus will also receive a sales commission of 8.5% on every transaction that is made by each of its agents.

• The Company will advertise its site heavily in the first three years of its operation, which contributes to the losses during this time.

• The anticipated media campaign will cost Pegasus about $1 million in the first year.

Hotel Search Page

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Tab for hotels, transfers & Sightseeing search

List for searching hotel in cities which are not commonly searched

You can narrow your search by searching for specific star category or hotel name

TBO Special offline hotel deal’s

Result Page- Domestic Hotels

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You can change details using this tab

Shows you only available options

You can narrow your search using these filters

Hotels details with description is available

Room details and cancellation policy

TBO Connect inventory Inventory from other suppliers with

inclusions

Rate break for entire stay

Booking button

Result Page – International Hotels

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Consolidated result for particular hotel shown with cheapest available on top through different aggregators

Nett price shown in both INR & Foreign Currency.

Visa & Master card logos used for inventory from expedia, credit card required and rates are commissionable

Booking Page

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Sales Summary

Booking Details

Passenger Details

Cancellation Policy

Offers & Promotions

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Offers & promotions filter

Offer details

Confirmation Page

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Sales Summary

Booking Details Cancellation Policy

Documentation required for generating voucher for international bookings

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Booking Queues

Booking QueuesLast Cancellation date

Booking change request

Booking details (Voucher, Invoice, etc.)

Voucher

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Agency name & address

Confirmation number

Hotel map for better understanding of location

Emergency contact numbers

Sign Up

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FUTURE PLANS

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Pegasus plans to gradually expand into the next largest market with the most potential – Europe, and will continue to offer the same quality service to these new customers.

Pegasus will also continue to please its customers by offering special event packages, such as birthdays and golden anniversaries.

Furthermore, the Company will begin providing tours for the disabled, believing that there are very few players in the market which target this particular segment.

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LEARNING OUTCOMES OF PEGASUS TRAVEL

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