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Launching of “Bandu Well-Being & Ayurveda Spa Resort” Boutique Hotel

Project of 50 Cottages with focus on mix concepts of “Well-Being & Dark
Tourism "including authentic traditiona...

Thesis · July 2020

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 British School of Commerce, Colombo
MBA for Executives

The BUSINESS DEVELOPMENT PROPOSAL

Launching of “Bandu Well-Being & Ayurveda

Spa Resort” Boutique Hotel Project of 50
Cottages with focus on mix concepts of “Well-
Being & Dark Tourism”including authentic
traditional medicines of Sri Lanka.

Student Name: Harindu Dharshana Weerakoon

University Student ID:S215659
Module Lecturer: Dr. Lester Massingham
Module Tutors :Ms. Apsara Hewage
Mr.Nagendram Skandakumar
Mr. Priyanka Nishantha
Mr. Thiwanka Pathirana
Word Count : 13,127
Date :13.07.2020

Pagei
 AUTHOR’S DECLARATION

I declare that the work in this Business Development Proposal was carried out in accordance
with the Regulations of University of Suffolk. The work is original except where indicated by
special reference in the text and no part of the Business Development Proposal has been
actioned for any other degree.

Any views expressed in the Business Development Proposal are those of the author and in no
way represent those of University of Suffolk.

The Business Development Proposal has not been actioned at any other public or private
organization either in the United Kingdom or overseas.

I hereby give my consent for my Business Development Proposal, if accepted, to be available

for photocopying and for inter-library loan, and for the title and summary to be made available
to outside organizations.

This Business Development Proposal is being submitted in accordance with the requirement
for the degree of MBA.

PRINT NAME: Harindu Dharshana Weerakoon

DATE: 13.07.2020

STUDENT NUMBER: S215659

P a g e ii
Executive Summery

Author is Professional Hotelier and Head of Finance counting 23+ experience in Sri Lanka,
United Arab Emirates, Maldives, Zanzibar – Tanzania and Rwanda. As a traveler, He has
travelled to many countries, he is a major reviewer of “TripAdvisor” and a writer to Leading
Sri Lankan Newspapers and Magazines regarding tourism.

The concept of “Well-Being & Dark Tourism” including authentic traditional medicines
of Sri Lanka was in his mind for the last 05-06 years. The conceptwas inspired by staying at
high end hotels such asJumeirah Maldives, Four Seasons hotels and resorts Maldives& Six
Senses hotel Maldives.

During the holidays in Sri Lanka, as a habit, author used to stay in a Hotel with his family and
realized that Sri Lanka tourism is lacking the global outlook and has not seriously identified
the requirements of the world’s trend and demand for hospitality.

Further Author’s long carrier as a Hotelier lead him to be a patient whom is suffering from
conditions of Fatty Liver and High Cholesterol due to the unhealthy food and beverage
consumed.

In South Asia, Sri Lanka, India and Maldives play a key role in Tourism. The major advantage
is that all 03 countries are situated in the Indian Ocean and it’s just a matter of 1.5-2.5 hours
travelling between by air.

By analyzing the tourist arrivals and source markets of India, Maldives & Sri Lanka of last 05
years, the author realized that there is a continuous significant increase of guests / Travelers
arrivals. (2.3 Million Guests Arrivals in 2018 – Sri Lanka, 17.42 Million in India 2019 & 1.7
Million in the Maldives in 2019).

Further, the world’s demand for wellness tourism in the Asia Pacific recorded 136.7 Billion
USD and projection for 2022 will be 251.6 Billion USD. In the same way the demand for Dark
Tourism is also increasing annually.

The Board of Directors of Bandu River Inn, Kalutara, Sri Lanka invited the author to present a
Business Development Proposal to for their hotel expansion in Athwelthota, Kalutara District,
Western Province Sri Lanka close to Sinharaja Rain Forest, with the knowledge and experience
gained from the career and the academic knowledge gained from the MBA programof the
British School of Commerce, the author wrote this Business Development Proposal.

P a g e iii
Author used Ansoff Matrix , PESTLE Analysis , Potters 05 forces , The 7 Ps of marketing ,
SWOT Analysis , Unique selling proposition (USP) , Hotel Marketing Mix , 7-S Framework
for a Hotel , Risk Assessment , Critical Success Factors. Further SBU Budgets for Rooms,
F&B, Spa, MOD, A&G, S&M and POMEC departments of the hotel.

Further author worked out (Per Forma) Budgeted Profit or Loss Accounts working for the year
2022, 2023 & 2024. Break Even Analysis, Start-up Capital Breakdown, Working Capital
Requirements, Cash budgets for 03 years, statement of financial position, Sensitivity Analysis,
Ratio Analysis & Schedule for Implementation.

Zero (0) Based Budget (ZBB) approach used for the calculations since there are no historic
data. The concept of “Well-Being & Dark Tourism” including authentic traditional medicines
of Sri Lanka is a unique concept. The competitors’ financials are not available. The author
used his industry knowledge and experience and hypothesis to assume the numbers.

The result and outcome are pretty impressive which Bandu Well-Being & Ayurveda Spa
Resort” will reach 17.53% of NOP at the end of 03rd year (year 2024).

The assumption is that there will be a successful vaccine for Coronavirus disease 2019
(COVID-19) soon and the world will be back to Normal.

P a g e iv
Table of Contents

1 Introduction ............................................................................................................................. 1

1.1Background of the study ................................................................................................... 3

1.2Rational of the chosen topic .............................................................................................. 5

1.3 Research aim & research objectives................................................................................. 6

1.4 Research questions ........................................................................................................... 7

1.5 Summary of the key theories and models applied............................................................ 7

1.6 Proposed business objective & time scales ...................................................................... 8

1.7 Assumptions ..................................................................................................................... 8

1.8 Terms of references .......................................................................................................... 8

2 Literature review ..................................................................................................................... 9

2.1 Introduction to the proposed business development idea ................................................ 9

2.2 Critical review of the relevant literature & relevant theories / models .......................... 10

2.2.1 Evolvement of the company and its current status .................................................. 10

2.2.2 Industry .................................................................................................................... 11

2.2.3 Market ...................................................................................................................... 11

2.3.4 Product or Service ................................................................................................... 12

2.3.5 Technology .............................................................................................................. 15

2.3.6 Finance..................................................................................................................... 16

2.3.7 Legal / Ethical .......................................................................................................... 17

3 Research Methodologies ....................................................................................................... 20

3.1 Research background statement ..................................................................................... 20

3.2 Overall Research Design ................................................................................................ 20

3.2.1 Research Approach .................................................................................................. 20

3.2.2 Research Design ...................................................................................................... 21

3.2.3 Research Strategy .................................................................................................... 22

3.2.4 Research Instruments ............................................................................................... 23

Pagev
 3.2.5 Sampling Plan .......................................................................................................... 23

3.2.6 Data Types & Data Collection Method ................................................................... 24

3.3 Research Ethics .............................................................................................................. 25

3.4 Research Barriers & Limitations .................................................................................... 26

4 Data / Results analysis .......................................................................................................... 28

4.1 Data Analysis in Terms of the proposed business Idea .................................................. 28

4.1.1 Macro Environment Analysis .................................................................................. 28

4.1.2 Industry Environment Analysis ............................................................................... 40

4.1.3 Market Analysis ....................................................................................................... 46

4.1.4 SWOT Analysis ....................................................................................................... 58

4.2 Risk Assessment............................................................................................................. 66

4.3 Critical Success Factors ................................................................................................. 74

5 Discussion, Conclusions & recommendations ...................................................................... 76

5.1 Strategic Business Unit Plan (SBU Plan)....................................................................... 77

5.1.1 Rooms Department – (Front Office, Reservation & Housekeeping) ...................... 79

5.1.2 Food & Beverage (F&B) Department – (All Outlets, All Bars, All Restaurants &
F&B Production – Main Kitchen) .................................................................................... 84

5.1.3 Spa & Ayurveda Center – (Spa Treatment & Retail, Hair Salon Treatment &
Retail, Yoga, Ayurveda Center, Sports, Fitness and visiting practitioners) ..................... 89

5.1.4 Minor Operating Department (MOD) – (Telephone, Laundry, Boutique, Kids Club)
.......................................................................................................................................... 94

5.1.5 Administration & General Department (A&G) – (Executive Office, Finance,

Human Resource, Training, Security & Information Technology (IT)) .......................... 99

5.1.6 Sales & Marketing Department ............................................................................. 105

5.1.7 Property Operations, Maintenance & Energy Consultants (POMEC) –

(Engineering, Repair & Maintenance, Garden and Utilities) ......................................... 109

5.2 Financial Projections for the proposed business Development option ........................ 113

Year 2022 ........................................................................................................................... 113

P a g e vi
 Year 2023 ........................................................................................................................... 115

Year 2024 ........................................................................................................................... 118

5.2.1 Start-up Capital Breakdown .................................................................................. 122

5.2.2. Working Capital Requirements ............................................................................ 124

5.2.3 Quarterly Based cash budgets................................................................................ 125

5.2.4 Budgeted income statements ................................................................................. 126

5.2.5 Budgeted statement of financial position .............................................................. 127

5.2.6 Breakeven Analysis ............................................................................................... 128

5.2.7 Sensitivity Analysis ............................................................................................... 130

5.2.8 Ratio Analysis........................................................................................................ 132

5.2.9 Cost Management .................................................................................................. 134

5.3 Schedule for Implementation ....................................................................................... 136

5.4 Viability........................................................................................................................ 137

6 References ........................................................................................................................... 138

7 Bibliography ....................................................................................................................... 162

8 Appendices .......................................................................................................................... 169

Appendix 1: Fixed Assets, Depreciation & Insurance Premium ....................................... 169

Appendix 2: Interest on Bank Loan Calculation ................................................................ 170

Appendix 3: Notes to the statement of financial position .................................................. 170

Appendix 4: workings of quarterly based cash budgets ..................................................... 172

Appendix 5 Tourism Statistics ........................................................................................... 177

I. Accommodation Capacity & Guest Nights in Graded & Supplementary

Establishments2007 to 2018............................................................................................... 177

II. Revenue from visitors to conservation forests – 2018 ............................................ 178

III. Details by Location 2018 ........................................................................................ 179

IV. Percentage Arrival & Department by & Category of Travelers 2018..................... 180

P a g e vii
List of Tables

Table 4 - 1 Sri Lanka Tourist Arrivals by Region (Asia & Pacific) – 2015 to 2018 ............... 35
Table 4 - 2 Sri Lanka - Top Ten Source Markets – 2017-2018 ............................................... 35
Table 4 - 3 Distribution of Tourists by Sex and Region -2018 ................................................ 36
Table 4 - 4 Distribution of Tourists by Age Group (Percentage) – 2018 ................................ 37
Table 4 - 5 Wellness tourism trips and expenditures by Region, 2015 and 2017.................... 37
Table 4 - 6 Top 20 wellness tourism destination market 2017 ................................................ 38
Table 4 - 7 Wellness tourism growth projections .................................................................... 39
Table 4 - 8 Top 10 Dark Tourist Destinations in the world. (2010) ........................................ 39
Table 4 - 9 Class of Accommodation of Establishments by Category- 2018 .......................... 40
Table 4 - 10 Accommodation Capacity (Rooms) in Tourist Hotels and its Regional
Distribution -2018 .................................................................................................................... 41
Table 4 - 11 India – Tourism (Statistics) 2019 ........................................................................ 42
Table 4 - 12 India - Foreign tourist arrivals from top 15 source markets (2019) .................... 42
Table 4 - 13 Maldives Tourism Statistics 2019 ....................................................................... 43
Table 4 - 14 Percentage Distribution of Tourist Arrivals by purpose of Visit- 2007- 2018 .... 49
Table 4 - 15 Tourist Arrivals by Country of Residence & purpose of Visit – 2018 ................ 50
Table 4 - 16 Tourist Arrivals by purpose of Visit – 2018 ........................................................ 57

Table 5 - 1 Basis of Revenue Recognition............................................................................... 78

Table 5 - 2 Staff Budget Rooms Department........................................................................... 79
Table 5 - 3 Room Department Budget (Pro Forma) - USD ..................................................... 82
Table 5 - 4 Staff Budget – Food & Beverage Department ...................................................... 84
Table 5 - 5 Food & Beverage Department Budget (Pro Forma) - USD .................................. 86
Table 5 - 6 Staff Budget - Spa & Ayurveda Center ................................................................. 89
Table 5 - 7 Spa & Ayurveda Department Budget (Pro Forma) - USD .................................... 91
Table 5 - 8 Staff Budget – Minor Operating Department ........................................................ 94
Table 5 - 9 Minor Operating Department Budget (Pro Forma) USD ...................................... 96
Table 5 - 10 Staff Budget – Admin and General ..................................................................... 99
Table 5 - 11 Admin & General Budget (Pro Forma) USD .................................................... 103
Table 5 - 12 Staff Budget – Sales & Marketing..................................................................... 105
Table 5 - 13 Sales & Marketing Budget (Pro Forma) USD ................................................... 107
P a g e viii
Table 5 - 14 Staff Budget - Property Operations, Maintenance & Energy Consultants ........ 109
Table 5 - 15 Property Operations, Maintenance & Energy Consultants Budget (Pro Forma)
USD........................................................................................................................................ 111

P a g e ix
List of Figures

Figures 1 - 1 Google Map of Athwelthota, Kalutara District, Western Province Sri Lanka ..... 1
Figures 1 - 2 Location of Athwelthota ....................................................................................... 2
Figures 1 - 3 Tourist Arrivals 2018............................................................................................ 5
Figures 1 - 4 Purpose of Tourist Arrivals 2018 ......................................................................... 5

Figures 2 - 1 the Ansoff Matrix ................................................................................................. 9

Figures 2 - 2 The 4 life cycle stages and their marketing implications. .................................. 12
Figures 2 - 3 A Project Life Cycle for New Hotels. ................................................................ 13
Figures 2 - 4 BCG Matrix model ............................................................................................. 13
Figures 2 - 5 Non Communicable Disease .............................................................................. 14

Figures 4 - 1 PESTLE Analysis ............................................................................................... 28

Figures 4 - 2 Potters 05 forces ................................................................................................. 44
Figures 4 - 3 The 7 Ps of marketing ......................................................................................... 47
Figures 4 - 4 SWOT Analysis .................................................................................................. 58
Figures 4 - 5 unique selling proposition (USP) ....................................................................... 60
Figures 4 - 6 Hotel Marketing Mix .......................................................................................... 61
Figures 4 - 7 “7-S” Framework for a Hotel ............................................................................. 64

Pagex
List of Abbreviations

4IR - Fourth Industrial Revolution

A&G – Administration & General
ADR - Average Daily Rate / Revenue
ARR - Average Room Rate
AWPLR - Average Weighted Prime Lending Rate
BCG - Boston Consulting Group
BDP – Business Development Proposal
Bn – Billion
C – Celsius
CAM Practitioners - Complementary & Alternative Medicines Practitioners
COVID 19 - Coronavirus disease 2019
CPOR – Cost per Occupied Room
CSR - Corporate Social Responsibility
ESC - Economic Service Charge
F – Fahrenheit
F&B – Food & Beverage
Gamma GT – Gamma Glutamyl Transferase
GDP – Gross Domestic Product
GOP – Gross Operating Profit
HR – Human Resources
ICT – Information & Communications Technology
ILO – International Labour Organization
IT – Information Technology
KM – Kilo Meters
KPI – Key Performance Indicators
LCD TV – Liquid Crystal Display Televisions
MBA – Master of Business Administration
MICE - Meetings, Incentives, Conferences, and Exhibitions
Mn – Million
MOD – Minor Operating Department
NCD – Non Communicable Disease
NGO - Non-Governmental Organization
P a g e xi
NOL – Net Operating Loss
NOP – Net Operating Profit
NRevPAR - Net Revenue per Available Room
OSH - Occupational Safety & Health
P&P - Policies & Procedures
PESTLE - Political, Economic, Social, Technological, Legal and Environmental
PLC - Project Life Cycle / Public Limited Company
POMEC - Property Operations, Maintenance & Energy Consultants
PPE – Property Plant & Equipment
R&D – Research & Development
RevPAR – Revenue per Available Room
RevPOR - Revenue per Occupied Room
ROCE - Return on Capital Employed Ratio
S&M – Sales & Marketing
S.G.O.T - Serum Glutamic Oxaloacetic Transaminase
S.G.P.T - Serum Glutamic Pyruvic Transaminase
SBU – Strategic Business Unit
SEO – Search Engine Optimization
SLR / RS / LKR – Sri Lanka Rupees
SLTDA - Sri Lanka Tourism Development Authority
SOP – Standard Operating Procedure
STP - Segmentation, Target, Positioning
SWOT - Strengths, Weaknesses, Opportunities, and Threats
UAE – United Arab Emirates
UK – United Kingdom
USA – United States of America
USD / US$ - United States Dollars
USP - Unique selling proposition / Points
VAT - Value Added Tax
WHO – World Health Organization
WP – Western Province
ZBB – Zero Based Budgets

P a g e xii
1 Introduction

The Author is a Hotelier counting 23+ years of experience in Sri Lanka and Overseas as a Head
of Finance. The author earned the theory knowledge from the British School of Commerce
while writing for the MBA for the University of Suffolk.

Author was requested by the Board of Directors of “Bandu River Inn” Kalutara Sri Lanka to
expand their hotel business to a new era since he is serving as the Director of Finance and
Operations.

Based on the working experience, academic &professional knowledge and life experience as a
traveler in Sri Lanka & Overseas the author , has proposed to Launch a New Boutique Hotel
Project of 50 Cottages (Class of Accommodation – 05 Star Luxury) with focus on mix concepts
of “Well-Being & Dark Tourism” including authentic traditional medicines of Sri Lanka.

Figures 1 - 1Google Map of Athwelthota, Kalutara District, Western Province Sri Lanka

P a g e 1 | 192
Figures 1 - 2Location of Athwelthota

The proposed location is Athwelthota, Kalutara District, Western Province Sri Lanka which is
a remote village surrounding by waterfalls and natural beauty. Further, it’s close to the
(Sinharaja Forest , 2020)Reserve, island’s extensive tract of undisturbed tropical rainforest
which is spread over 11,187 Hectares.

The concept of “well-being” a newspaper article written by the author (Weerakoon,

2019).focuses on food consist of un-saturated fat using modern methods of cooking to protect
the nutritious factors of food consumed. The main focus is to minimize the effect on patients
who suffer from cholesterol and fatty liver issues. India and Maldives play an important role

P a g e 2 | 192
in well-being tourism through healthy eating habits and minimizing the consumption of
alcoholic beverages contributes to the cause.

“Dark Tourism” concept and how to apply it to Sri Lanka is written by the author (Weerakoon,
2019). A living environment, that relies only on natural sources, without electricity, mobile
signals, and travelling on foot. This is the author’s view to provide a unique experience to the
guest. Do we really enjoy our holidays with smart phones and the internet? Do we focus on
updating Facebook status and other social media? Do we enjoy our holiday, and do we impress
others (Friends and Relatives)? Do we honestly let our mind and soul to relax? Exploring the
role of dark tourism in the creation of the national identity of young Americans written by
(Tinson, et al., 2015) described the definition of dark tourism. (Hohenhaus, 2020) Mentioned
that there are 900 different places in 112 countries including Sri Lanka for a guest to have
experience in dark tourism. Tourism to sites associated with tragedies, disasters, and death
(STANDS4 LLC, 2020) , (Stainton, 2020)

1.1 Background of the study

The highlights of the year 2018 indicate that the number of international tourists arrival to Sri
Lanka was2,333,796, Foreign exchange earnings Rs. 712,027.3 million, (US$ 4,380.6
million),Direct contribution to GDP 4.9%* Foreign exchange receipts per tourist per day US$
173.8, Average duration of stay 10.8 nights, Total foreign guest nights 25,204,996,the room
occupancy rate of graded accommodation 72.77%. Total employment generation 388,487,
direct employment 169,003, and indirect employment 219,484 .Top 5 tourist source markets
to Sri Lanka are India, China, United Kingdom, Germany and Australia.(Sri Lanka Tourism
Development Authority, 2019).

Year 2015 2016 2017 2018 2019

Number of international tourists 1,798,390 2,050,832 2,116,407 2,333,796 1,913,702

arrival to Sri Lanka

(Sri Lanka Tourism Development Authority, 2019)

P a g e 3 | 192
Year 2019 statistics are provisional as per (Central Bank of Sri Lanka, 2018)&(Sri Lanka
Tourism Development Authority, 2019). The number of tourist arrival has declined by 18%
and reordered as 1,913,702 (Provisional) due to Easter Sunday Attack.

On 21 April 2019, Easter Sunday, a series of coordinated Islamic terrorist suicide bombings
targeted three Sri Lankan churches and three luxury hotels in the commercial capital, Colombo.
Later that day, smaller explosions occurred at a Dematagoda housing complex and a guest
house in Dehiwala. Two hundred and fifty-nine people, including at least 45 foreign nationals
and three police officers, were killed and at least 500 injured, which resulted in the government
imposing an immediate Curfew and a complete ban on social media. The church bombings
were carried out in Negombo, Batticaloa and Colombo during Easter Services. The Shangri-
La, Cinnamon Grand, Kingsbury and Tropical Inn hotels were the ones bombed. The second
wave of attacks was also planned according to the State Intelligence Service but was stopped
as a result of government raids.(Wipulasena , 2020).

Further (MINISTRY OF HEALTH AND INDIGENOUS MEDICAL SERVICES, 2020) Sri

Lanka mentioned the effect of Coronavirus disease 2019 (COVID-19) also highly effects the
tourist arrivals of 2020. This is a growing market segment and the supply (Guests / Travelers)
is unlimited. Author highly believes the effect of COVID 19 pandemic and Sunday Easter
Attack in 2019 will be a temporary decline in the tourist’s arrivals in Sri Lanka.

P a g e 4 | 192
1.2 Rational of the chosen topic
Figures 1 - 3 Tourist Arrivals 2018

Tourist Arrivals - 2018

Others 897
Official 1,474
Religious 2,078
Education 1,504
Sports 14,942
Health 20,798
MICE 39,843
Business 92,134
Visiting Friends & Relatives 253,066
Pleasure / Vacation 1,907,060

0 500,000 1,000,000 1,500,000 2,000,000 2,500,000

(Sri Lanka Tourism Development Authority, 2019). Year 2019 statistics are provisional as per
(Central Bank of Sri Lanka, 2018)&(Sri Lanka Tourism Development Authority, 2019).
Therefore did not included in the above chart.

Figures 1 - 4 Purpose of Tourist Arrivals 2018

1%
Tourist Arrivals - 2018 - % 0%
2% 0% 0%
1% 0%
4%

11%

82%

Pleasure / Vacation Visiting Friends & Relatives Business

MICE Health Sports
Education Religious Official
Others

P a g e 5 | 192
(Sri Lanka Tourism Development Authority, 2019). Year 2019 statistics are provisional as per
(Central Bank of Sri Lanka, 2018)&(Sri Lanka Tourism Development Authority, 2019).
Therefore did not included in the above chart.

As explained (Morrison, 2016)The Ansoff matrix considers different ways to grow via the
existing products, market and the new products, market. Thus, based on these combinations,
Bandu River Inn poised to penetrate a different market by giving a wide range of products and
services at an affordable price.

Based on the above tourism statistics of Sri Lanka the demand for “Well-Being and Dark
Tourism”, the target segment of Guests / Travelers is people (Male & Female) above 40 years
who have high capacity of spending.

Based on the literature review, a health-conscious person must stop consuming alcohol and
oily food in order to protect from the cholesterol and fatty liver. The level of cholesterol can
be measured from a “Lipid Profile Test” and grade of fatty liver from an “Ultra Sound Scan of
Abdomen & Pelvis”. Further “Liver Profile Test” clarifies the level of enzymes of the liver
such as S.G.P.T and S.G.O.T and Gamma GT.

1.3 Research aim & research objectives

Research Aim

The aim of this research is to investigate the factors that affect the demand for "Well-Being &
Dark Tourism" for guests / travelers.

Objectives

To investigate factors affecting the concept of “Well-Being & Dark Tourism”.

To examine the significance and clarify the recent conditions that affect "Well-Being & Dark
Tourism" based on previous literature.

Evaluate analytical background to establish the concept of "Well-Being & Dark Tourism"
practices In Sri Lanka.

P a g e 6 | 192
1.4 Research questions

➢ How many guests / traveler arrived in Sri Lanka in comparison with India and
Maldives?
➢ What are the famous wellness tourism destinations and markets, Wellness tourism
growth projections?
➢ What are the leading Dark Tourism Destinations in the world?
➢ How many hotels do Sri Lanka have & the standardization?
➢ What are the purposes of the visits of the tourists who arrived in Sri Lanka and does the
industry specify their demand?

1.5 Summary of the key theories and models applied

The author will use the models and theories below to construct the BDP.

➢ Ansoff Matrix – Is a tool that Bandu River Inn use to analyze and plan their growth
strategies.
➢ PESTLE Analysis – Macro analysis to understand the Influencing an outside agency
➢ Potters 05 forces - Economic Powers to Increase Productivity.
➢ The 7 Ps of marketing - use this to review and reassess the Hotels’ activities
continuously.
➢ SWOT Analysis–Is to assess the Hotel’s in these four aspects such as Strengths,
Weaknesses, Opportunities, and Threats.
➢ Unique selling proposition (USP) - highlights the benefits of a Hotel which are
relevant to Guest / Travelers.
➢ Hotel Marketing Mix- describe the methods the marketer uses to manipulate demand.
➢ 7-S Framework for a Hotel - Tackled the strategic execution issue. The Hotel has an
outstanding organizational structure and strategy.
➢ Risk Assessment- Identify hazards and risk factors that could cause harm to the Hotel.
➢ Critical Success Factors - item required to accomplish the mission of the Hotel.

P a g e 7 | 192
1.6 Proposed business objective & time scales

The main purpose of this business development project is to increase the revenue of the Hotel
by 40% and Market share increase by 15%.

A foretasted Cash Flow Statement, Profit or Loss Statement will be prepared for 03 years,
Bandu River Inn is expected to complete the construction of the New Boutique Hotel Project
consist of 50 Cottages within 12 months. 5.3 Schedule for Implementation

1.7 Assumptions

• Effect of Coronavirus disease 2019 (COVID-19) did not consider for the BDP.
• The effect of Inflation, Exchange Rates fluctuations, Changes of Bank Borrowing rates
will not be considered and for the calculation purpose of SBU Budgets , Cash Flow,
Profit or Loss Statement , Statement of Financial Position and other calculations.
• Detailed Assumptions of Chapter 05, mentioned in 5.1 Strategic Business Unit Plan
(SBU Plan)

1.8 Terms of references

The business development proposal for "Bandu Well-Being & Ayurveda Spa Resort” will
address the following important aspects before the start of the Hotel Project to understand what
obstacles the Bandu River Inn faces and how they can be mitigated for a productive business
venture.

• Concept overview of the boutique hotel

• Assessment of BDP and market readiness for BDP
• Development of a business model with realistic financial forecasts & growth proposals
• Design, execution and implementation of the BDP
• Financial expectations

P a g e 8 | 192
2 Literature review

2.1 Introduction to the proposed business development idea

Figures 2 - 1the Ansoff Matrix

Launching of New Boutique Hotel Project of 50 Cottages (Class of Accommodation – 05 Star

Luxury) with focus on mix concepts of “Well-Being & Dark Tourism “including authentic
traditional medicines of Sri Lanka at Athwelthota, Kalutara District in the Western Province
Sri Lanka. Based on the definition of “The Ansoff Matrix” this business development proposal
can be categorised as “Product Development”.

Key features of the boutique hotel

• Land extent of the project will be 100 Acres, cottages will be built as green buildings
and distanced to protect the privacy of guests. More plants and trees will be planted
and conservation of existing foliage will be focused.
• Organic farming (for consumption)
• No Alcoholic Drinks will be served or allowed
• Authentic traditional medicines of Sri Lanka
• Ayurveda doctors, nutritionists, naturopaths, CAM practitioners, physiotherapists,
fitness managers, yoga instructors, health coaches and qualified spa therapists will be
the team.
• No Internet , No Mobile Phones , No Computers and any other devices are not allowed
(in case of emergencies , hotel telephone , hotel internet ,computers and satellite
phonescan be used)
P a g e 9 | 192
 • Traditional Sri Lankan oil lamps and traditional lighting systems will be used (for
emergencies , electricity and backup generators will be available)
• Preparation meals will depends on individual guest’s health history.
• To comply with Greener and social acceptability, No Vehicles will be used within the
Hotel premises. Bicycles and Electric Buggies will be used. Solar Power will be used
, Re-cycling of waste water and other wastages , compost fertilizer, waste heat will be
used for Spa ,
• CSR – from the Room Revenue of every USD 1,000 hotel will reserve USD 1/- for
CSR Fund Account. And guests are encouraged to donate to the CSR Fund. (CSR
projects will be done along with the Lions Club International - Multiple District 306 Sri
Lanka.

2.2 Critical review of the relevant literature & relevant theories / models

2.2.1 Evolvement of the company and its current status

Bandu River Inn (Inn, 2020)Riverside Road, Palatota, Kalutara Sou th (Western
Province) Sri Lanka, Isn’t just a hotel. It is a paradise away from home with luxury services
and facilities for over 20 years in South West Sri Lanka, Approved by Sri Lanka Tourist Board
An Iconic hotel in the heart of Kalutara. Located overlooking the Kalu Ganga, gifted with
history, it is where comfort blends with affordability for the most discerning traveler and
Newlyweds.

Mr.Wenusha Edirisinghe and his father Mr. Bandhula Edirisinghe (leading hotelier served
Ceylon hotel cooperation) and sister Miss Tiny Edirisinghe are managing the business. Bandu
River Inn has registered as a partnership under the regulations (Business Name Registration
Department (WP), 2020).

Bandu River Inn owners are partners of a Travel Agency (The Travel Connectors) and Online
Booking Engine (Stayin) &Managing – Elephant Eye Safari Hotel by Eazzy (Yala National
Park), Kalawawa Heritage Resort& Rice of Life by Tissa Inn.

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2.2.2 Industry

(Siriwardana, et al., 2019)Explains Sri Lanka how the tourism industry with a comparison from
the year 2009. The support of Sri Lanka government to boom the hospitality sector has been
explained. A literature review has done on destination management, destination marketing and
destination image. A sample of 25 from all over the world who have not traveled to Sri Lanka
has been selected for the survey. The questions asked were, 1. What is the tourists' pre-visit
picture, towards Sri Lanka? 2. What role do sources of knowledge play in shaping such a pre-
visited image? The answers were not in favor of Sri Lanka.

Author discovered there are several fundamental mistakes of the above journal article. The
sample selected must be taken from the “Trip Advisor” website who are travelers. The selected
group of sample must already be visited at least India and Maldives. Then only they have an
idea or impression of Sri Lanka.

It’s a continuous debate and discussion of why someone needs to choose Sri Lanka instead of
travelling to India to spend the holiday. (Wilson, n.d.) Describes that Sri Lanka is an Island,
Sri Lanka and India are two different countries, Sri Lanka is cleaner and has a smaller
population, Hospitality at its finest, Cultural Diversity, better Beaches and Unique Wildlife,
Beaches, Tea Hills, Wild Plains, and Mountains. All in one place. (Music , 2018)Describes
travelling to Sri Lanka as a solo traveler is safe, with a rich culture, variety of foods and a place
to visit.

2.2.3 Market

Segmentation, target, positioning STP

STP Model Explains by (Mind Tools, 2018) as Segmentation, Targeting and Positioning.

Segmentation divided in to 04 categories such as;

➢ Demographic - By personal characteristics such as age, marital status, gender,

ethnicity, orientation, education, or employment.
➢ Geographic - By nation, region, state, city, or surrounding area.
➢ Psychographic - Risk aversion, values or lifestyle, by personality.
➢ Behavioral- By how people use the product, by how loyal they are, or by the benefits
they seek.

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Targeting - First, look at the each segment’s profitability. What categories of customers
contribute the most to your bottom line?

Positioning - the goal is to determine how you want the product to be positioned to reach the
most important consumer segments. Then, you can pick the most powerful marketing
combination for each one of them.

The 7 Ps of Service Marketing In Hotel Industry explained by (NEELAM, 2018). Product,

Price, Place, Promotion, Process, People & Physical Evidence.

2.3.4 Product or Service

Figures 2 - 2The 4 life cycle stages and their marketing implications.

Project Life Cycle (PLC Tool) is slightly different from other industries. As explained by
(Noordzy & Whitfield, 2015)

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Figures 2 - 3A Project Life Cycle for New Hotels.

(Noordzy & Whitfield, 2015)

Figures 2 - 4BCG Matrix model

(Strategic Management for Tourism, n.d.)

Stars - In the BCG matrix of Sri Lanka's hotels’ Competitive Strategy and Sustainable
Tourism, the financial services strategic business unit is a star. It operates in a market that
exhibits future potential. Sri Lankan Hotels’ Business Approach and Sustainable Tourism in
Sri Lanka receives a large portion of its income from this SBU.Sri Lanka's Growth Strategy
and Sustainable Tourism will expand vertically through the acquisition of other companies in
the supply chain. As this Strategic business unit has potential, this will help it earn more
profits.(Scott , 2018)

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Cash Cow -The strategic business unit for provider management service is a cash cow in Sri
Lanka's Hotel Growth Strategy and Sustainable Tourism BCG matrix. This has been in use for
over decades and has gained a large amount of revenue from Sri Lanka's Hotels Business
Strategy and Sustainable Tourism.Sri Lanka's Hotels Competitive Strategy and Sustainable
Tourism's market share is high, but the overall market is declining as companies manage their
own suppliers rather than outsourcing them.The recommended strategy for Sri Lanka's Hotel
Competitive Strategy and Sustainable Tourism is to avoid further investment in this sector and
continue to run as long as its profitable business unit. (Scott , 2018)

Question Marks - The strategic local food business unit for Sri Lanka's Hotel’s Economic
Strategy and Sustainable Tourism is a question mark in the BCG matrix. Recent market trends
show consumers are more focused on local foods. Hence this market shows a high rate of
growth in the market.Hotel’s Business Strategy and Sustainable Tourism in Sri Lanka however
has a small market share in this category. Hotel’s Competitive Strategy and Sustainable
Tourism's recommended strategy for Sri Lanka is to invest in research and development to
develop innovative features.This product development plan will ensure that this strategic
business segment is a cash cow and will generate potential profits for the company. (Scott ,
2018)

Dogs - The strategic business unit for the plastic bags is a dog in the Sri Lankan BCG matrix
of Hotels’ Competitive Strategy and Sustainable Tourism. For the last 5 years, that strategic
business unit has been in the loss.It also operates in a declining market, due to increased
environmental concerns. Hotel’s Economic Strategy and Sustainable Tourism’s suggested plan
for Sri Lanka is to divest this strategic business unit and reduce its losses. (Scott , 2018)

Figures 2 - 5 Non Communicable Disease

(Healthline Media, 2020) Explains unhealthy diets, lack of physical activity, smoking and
secondhand smoke, excessive use of alcohol are the reasons for non-communicable diseases

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(NCDs). Poor diet and physical inactivity can cause increased blood pressure, blood glucose,
blood lipids, and obesity. Many risks of non-communicable diseases are preventable. These
risk factors include,physical inactivity tobacco use, alcohol use, unhealthy diet (high in fat,
processed sugar, and sodium, with little intake of fruits and vegetables).(World Health
Organization (WHO), 2018) Says kill 41 million people each year, equivalent to 71% of all
deaths globally. 15 million people die from a NCDs between the ages of 30 and 69 years.

Based on the literature review, the most critical ages falls between 30-69 years. The non-
communicable diseases are avoidable and it’s a matter of changing our habits and practices.

2.3.5 Technology

Technology developments shaping the hospitality industry in Sri Lanka explained by (James,
2011). His emphasis Hospitality industry how technology improves. Defining strategic goals
for the hotel industry. Identify market dynamics and value chain of companies. Align business
goals. Improve process control. Improve guest experience. Reduce personnel requirement. Fast
service delivery. Guest loyalty. Cost saving. Maintain market leadership.

The very first point is an average guest / traveler should be aware his travelling location. He or
she should be in a position to find the required information. Website optimization and in which
rank the particular website displays in a search engine also play a vital role. The websites need
to be user friendly and not much complicated to obtain the key information to the users. More
pictures and unnecessary links and too many information may discourage the users. Further the
downloading time also very important.

(Elwin, 2013) Explain the modern cooking methods for healthy eating. Such as Steaming ,
Microwaving , Stir frying , Boiling , Sautéing , Poaching , Grilling , Barbecuing , Roasting ,
Baking , Frying . The expectations are less oil food and to protect the maximum nutrients of the
food. (Towsey, 2017)

A busy lifestyle also affects our life hood and living hood. People are more and busier than ever.
In complicated and compact life-styles it’s a question whether they have time to do a healthy
cooking method or just buy from a fast food shop. It’s a debate always.

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(Moitra, 2010) Explains the taste and the nutritive values of the same food can be varied and
depends on the method of cooking. We must be very concern about how to keep a balance of
the taste as well as nutritious factors. The most recommended way is to have more fresh and
raw food. High temperatures, longer cooking, direct contact with oil and, water are less healthy.
Therefore the recommended methods are steaming, stir-frying or poaching to boiling,
blanching or deep frying.

There is ample of theories and methods, but the question is “whether it’s practical?” Frankly
we have to depend on the farmers and people who cook the food for us. In a limited capacity
housewife’s cook the food which depends on the time and other social factors and the life style
they have. Further which kind of geographical location they live. Spending capacity. Level of
education and level of understanding of the people. Mainly the attitudes of the people.

2.3.6 Finance

As a result of the reduced tourist arrivals following the Easter Sunday attacks, a substantial
decline in tourist earnings have been reported.(Central Bank of Sri Lanka, 2018) According to
the (Sri Lanka Tourism Development Authority, 2019) (SLTDA)'s annual survey of tourism
spending, the average spending per visitor in 2019 increased to US dollars 181.23 a day from
US dollars 173.80 a day in 2018.The SLTDA survey indicates a rise in accommodation
spending as the key explanation for the increase in average spending per visitor, given some
negative effects after the Easter Sunday attacks on the rates. The average length of a tourist's
stay in 2019 was estimated at 10.4 days, compared with 10.8 days in 2018.The Sri Lankan
Tourism Development Authority (SLTDA) reports that direct and indirect jobs in the tourism
sector is 4.6 per cent of Sri Lanka's total labor force. In addition, tourism earnings as a share of
the country's GDP are about 4% -5%.

2019 tourism results affected by Easter Sunday Attack and 2020 COVID 19 pandemic. But
based on the data for the last 05 years and the data of India & Maldives, author highly believe
that from 2021 onwards, Sri Lanka Tourism Industry will start picking up.

(Myassignment, 2020) Explains several facts concerning the hotel and hospitality sector in Sri
Lanka have been identified; however, the industry has experienced a high level of competition
over the past few years. It is therefore deemed appropriate for them to work towards improving
the overall background of the industry in the future. Meanwhile, companies must concentrate
on improving overall output levels. They need to work in a sustainable manner with the
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stakeholders and improve both the revenue potential and the profit potential. The current results
have shown that the businesses need to improve some areas and concentrate on potential
standards of success.

The question is we need to analysis the number of tourist arrivals in India and Maldives.
Whether the guests / travelers who visit India and Maldives, visits Sri Lanka as well. Further
what are the reasons of Sri Lankans to travels India, Maldives and other countries? Which
expectations are lacking from the point of view of a guests / travelers.

2.3.7 Legal / Ethical

(POWELL, et al., 2009) Discussed the obstacles facing in developing the tourism in Sri Lanka.
How the legal framework should be amended accordingly. Sustainable Development and
Nature-Based Tourism also discussed. The effect of 30 years of the civil war the other relevant
factors analyzed by (Selvanathan, 2007).

Author observed with his vast experience in the tourism industry that bureaucracy and mere
administrators and people who do not have a sound background of hotels and none hoteliers
involvements in decision making have crippled the tourism industry in Sri Lanka.

(Coast Conservation Resource Management Department, 2020) the primary agency is

responsible for balancing environmental priorities such as mitigating coastal erosion with a
holistic approach to erosion management, ensuring good-standard construction practices,
encouraging and supporting coastal resource-based economic growth with enhanced living
conditions for coastal communities and resource consumers with country development needs.
Sri Lanka coastline is about 1700 KM Long.

By law of Sri Lanka the beaches are public property. No hotels have the legal right to restrict
or ban the beach in front of a hotel to the general public. Therefore the privacy of the guests
are highly affected.

(BATTEN, et al., 2007)What remains of direction for government policy? This work shows
that changes have been made to tracking and promoting ethical management by following clear
procedures. The involvement of ethics committees and codes should not be the end, however,
but an initial step towards the creation of a large organizational culture that nurtures ethical

P a g e 17 | 192
practice.Government and business bodies certainly have a role to play in setting minimum
standards, but companies should also be supported by their various stakeholders to take the
initiative to develop an ethical management reputation.

Author emphasis that government should have active interference to control the ethics of the
industry. It’s seems government only concern to collect the taxes and the statistical data of the
hospitality industry.

(Sri Lanka Tourism Development Authority, 2019)It explains the code of ethics to the
travelers.Using the lodging and transportation network locally operated whenever possible.
Spread the financial advantages between local people and tour operators. Provide the local
population with opportunities for jobs and leadership. Respect for the local traditions and the
history thereof. Provide the intrepid staff and travelers with safe trips.Educate the tour operators
and the travelers about how and why we choose to travel in this way. Limit the negative impacts
of local people who are not involved with the intrepid groups on the daily lifestyles. Reduce
the physical impact of travel in all destination communities-particularly vulnerable,
environmental, and cultural environments.Provide support to the organizations and local
communities that the intrepid groups visit. Provide intrepid travelers with fun & enjoyable trips.
Offer travelers opportunities to connect with the locals. Actively forbid the involvement of the
leader and passenger in or support of commercial sexual activity or the use of illicit drug use
on intrepid journeys.Actively discourage intrepid groups from participating in activities that
lead to the exploitation of animals-wild or domestic. Using local tour operators who stick to
the intrepid ideals of responsible travel and offer the best possible service to intrepid travelers
and workers. Work towards preventing children from being exploited in tourism.Supporting
and promoting fair employment practices. Give the best value for money to our travelers.

Above details analysis including almost all aspects of ethics. In 1505 Sri Lanka’s Colonization
began with the Portuguese. It ended in 1948, after the British gave Sri Lanka independence.
During this 443 year period, Sri Lanka was under Portuguese rule (1505-1658), Dutch rule
(1658-1796), British rule (1796-1948). Naturally, Sri Lankans have high and inborn respect to
the foreigners. At the same time due to the exchange rate of Sri Lanka Rupees with foreign
currency. People tend to have a mentality to overcharge to the guests / travelers.

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CSR – Corporate Social Responsibilities, Hotels are conveniently located within the
communities they are located in. Each of the properties functions to mutual benefit in harmony
with the community and the environment.Hotels ‘philosophy has always been to share their
success and knowledge with the community, which has inspired them to develop strategic
Corporate Social Responsibility initiatives which will have a positive impact on all the
stakeholders.(Serendib Leisure, 2020)

Lions Club International has 06 Districts in Sri Lanka (A1, A2, B1, B2, C1, C2) which most
hotel owners and senior managers are members. Community services projects are doing
effectively and efficiently.

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3 Research Methodologies

3.1 Research background statement

The research methodology is based on the procedural framework; the logical approach that
research has focused on to ascertain the feasibility and consistency of the project by addressing
the primary research question and research objectives. As per the (Collis & Hussey, 2003),the
research methodology is the study of the procedural framework of the research study, overall
approach and research objectives, research instruments, data collection methods, sample size,
reliability, and validity of gathered data.

3.2 Overall Research Design

3.2.1 Research Approach

To identify the occupancy and guest demand for “well-being & Dark Tourism” for the tourist
hotels in Sri Lanka. The ultimate goals of the research are to address the issues related to the
identified research question. Research approaches can be mainly categorized into deductive
and inductive. In this research approach, there is no strategy to develop hypothesis testing
which is based on the deductive approach. The other approach is termed as an inductive
approach, based on a collection of secondary data gathered from published reports and then the
strategy has to be developed based on data analysis. This research is also based on secondary
data and statistics published on the web domain of (Sri Lanka Tourism Development Authority,
2019), (Central Bank of Sri Lanka, 2018) and gathered data from secondary sources, such as
some other web domains and previous research articles therefore, in this research the approach
is inductive.

As per the (Collins, 2010), Positivism has derived as the epistemology position which verifies
the added value of the duplicate of natural sciences is associated with the position of
epistemology has been identified as Positivism. In this, (Bryman & Bell, 2007) stated that both
deductive and inductive methods are involved, and the differences, also the gap in study and
theory are indicated. In this, the investigation is to examine the theory and to look for the
materials to shape rules. Moreover, as per the previous studies of (Saunders, et al., 2009)and
the research work of(McConville & Chui, 2007), has stated that if the theory is related to
positivism, the individual doing the work should use the empirical methods. As per the way
this research carried out, to formulate a research strategy, the Author have used the existing
theories, secondary data gathered from Sri Lanka Tourism Development Authority (SLTDA)
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published on (Sri Lanka Tourism Development Authority, 2019) and Central Bank of Sri Lanka
on their respective web domain on(Central Bank of Sri Lanka, 2018) to form this projection
strategy and then confirm these further with available statistics.

3.2.2 Research Design

As per the research methods, the procedures for the collection of gathering the critical
knowledge about the subject, discussed and stated problem, and then determine the best method
of obtaining appropriate relevant information after a thorough investigation, and then the
information has to be obtained in a structured manner with the aim of achieving the research
goal and objectives,(Ghauri & Grønhaug, 2005).

Methodology of study is the association and relation within the literature, research methods
designed to collect primary and secondary data for the research. Furthermore, the research
method according to (Bryman & Bell, 2007) is a comprehensive method for collecting the
required data. The methods contain tools such as questionnaires, (Likert scale or open/close-
ended) or structured interviews and respondents' direct or indirect participation by listening
and observing researchers' instructions.

In addition, according to (Ghauri & Grønhaug, 2005), there are two forms of study approaches
in drawing the conclusion without statistics or with statistical a method and these are
respectively "Qualitative approach and Quantitative approach".

Moreover, analysis methods are called "Inductive and Deductive." To obtain the information
from qualitative analysis, and is founded on the practical assessment with the observations and
moved towards generalization with theories, is called the inductive approach. On the other
hand, the deductive means linked to the literature-based development of the hypothesis in the
initial stage, and the quantitative method attained the data. Ultimately, a conclusion had been
drawn based on the analysis of statistical data gathered from the resources. As per the research
work, different approaches could be carried out to conduct the research according to (Saunders,
et al., 2009).

Deductive in which hypothesis is developed and then research technique designed to construct
the hypothesis and the other approach, naming the inductive method, where data is collected
and then observer and find the patterns related to the known theories and then the theory
developed based on data analysis. The deductive approach, as per the previous studies and
P a g e 21 | 192
theories are related and connected to positivism, and interpretivism is related to the inductive
approach.

In addition, as per (Easter , et al., 2008) they stated that when any research work is carried out
to identify the involvement and try to find out what is happening in any given situation or
scenario is much more appropriate to an inductive approach than a deductive approach. So as
the author tries to find answers for the questions, “whether there will be demand from the
guests/travelers for well-being & dark tourism”. and the how the forecasted occupancy will be
looked like, based on the data published on the web domain of Sri Lanka Tourism Development
Authority (SLTDA) on (Sri Lanka Tourism Development Authority, 2019) and Central Bank
of Sri Lanka on(Central Bank of Sri Lanka, 2018), this research falls under inductive research
method, because inductive research method is the strategy where data is collected and then
observer and find the patterns related to the known theories and then the theory developed
based on data analysis.

3.2.3 Research Strategy

As per the research design, this research is not positivism based because this research is not
based on statistical and objective data. However, this undergoing the research will be based on
interpretivism because it is highly related to the feelings, state of mind, and perceptions towards
a certain strategy of human beings.

In the light of the research's aims and objectives and the opinions of the above-mentioned
scientists, the quantitative methodology is mainly focused on statistics and the objects and
qualitative methodology examines human beings' emotions and behaviors. As the Author aims
to find the guest/travelers expectations and perceptions of being selecting a hotel and
destination, this research study will be based and focused on qualitative methods.

Hence for this research, the chosen methodology is Qualitative, as per the (Holloway, 1997)
the main aspect and the function of qualitative research approach is related to people's
perceptions, vision related to the way of thinking and feeling.

The author of this research work wants to learn and ascertain the rising demand for visitors
and their effect on the Sri Lankan tourism. As the subject shows, the ideas suggested and the
USPs would have an impact, as stated by (Topalian, 2003) USPs and distinction is the visionary
the goal of any company that is generated in the exclusive minds of the company stakeholders
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so it is assumed that the researcher needs to know the feelings, way of thinking, perception and
the opinions of the guests/travelers and what they think they have gained from that specific
hotel.

Secondly, the author wants to know if the USPs has given travelers worldwide
the organization's right picture, credibility, or policies, and systems. However, (Boxil, et al.,
1997), has stated that in their research work that the quantitative methodology offers some valid
answers to some typical questions such as a numerical representation of how much and how
many with the figures, but in qualitative methods, these are not needed to that clarity, but
according to the subject, the author does not require to that extent for the research. Thus, on
these bases, the qualitative method was chosen.

3.2.4 Research Instruments

This research is constructed using research instruments, which could be categorized into two
different research aspects, theoretical and practical aspects of the research study. Inhere
researcher use the semi-structured interviews, open-ended questions, telephone interviews as
the practical aspect of data collection tools and mainly based on the data published and gathered
during those interviews. Moreover, the researcher has done a critical analysis of theories,
reassesses the journal articles and studies relevant strategies related to this research, as the
theoretical aspect of this research study. The primary source or the research tools associated
with this research mainly based on the collected data published on their respective web domains
of Sri Lanka Tourism Development Authority (SLTDA), on (Sri Lanka Tourism Development
Authority, 2019) and Central Bank of Sri Lanka, published on their web domain(Central Bank
of Sri Lanka, 2018), discussions with the owner, of the company, previous study materials,
research papers and the collection of works of various observed case studies.The data reliability
and the validity is assured as the collected data has gathered internally, from published
company domains and through interviews directly researcher had with respective entities, the
data gathered should be reliable and valid for proposed study to be viable and its degree
consistency. (Newman & Benz, 1998)

3.2.5 Sampling Plan

As(Kumar, 2008), has stated that in his studies, research design has major importance since it
illustrates the facts of the researcher's intentions. It highlights the purpose of this research study
and shows the way the researcher has planned to carry out research in its major importance and

P a g e 23 | 192
stage by stage. It includes the research sampling plan, the procedures to be adopted, and how
the data will be analyzed.

The importance of sampling plan that it contributes to establishing the research the
methodology of this research project which is indeed the framework for correctly collecting
and analyzing the data. Therefore the research design is the rational and systematic strategy for
performing the research.

Furthermore, it emphasizes the significance of the methodology of this research work and as it
is important to know that research design is a well-organized plan, but it is not a specific plan
for every research framework, however, that must be followed without any changes, but it is
the same as the series of actions that need to be taken in the right direction. However, it is
significant to the research study where improvements can be made according to the specific
circumstances.

3.2.6 Data Types & Data Collection Method

(Saunders, et al., 2007), has stated that in their research paper there are mainly three types of
data available, documented data, several sources like web-based and survey-based data. Much
of the gathered data covers books, magazines, newspapers, and organizational data such as
email, annual reports, and data released by the government (Central Bank of Sri Lanka, Sri
Lanka Tourism Development Authority (SLTDA).

The various sources have two additional forms of data that cover area-based as well as the time
series-based, according to writers. Data from the time series can be used for mainly research
projects of taught university undergraduate and university postgraduate courses in which
researchers are able to study the data for a long period. Therefore, based on the views of the
above sources, the author has used authentic places to gather his data. The author used the data
from various sources because he decided to use the available financial reports and balance
sheets to analyze the company’s results, but private companies did not publish such details on
their websites and concentrated on responsibilities such as corporate responsibilities which are
also helpful.

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3.3 Research Ethics

(Saunders, et al., 2007)Has stated that in their research paper in the Axiology, according to
types of research involved in aesthetics, ethics as well as social inquiry. For the above concern,
the author has stated that his own declaration of personal values relevant to the relevant topic
being studied by the researcher.

According to(Cresswell, 2009), he stated that the qualitative research approach is a method of
identifying and recognizing the importance of the behavioral patterns and the significant
characteristics of individuals or groups to a specific or human problem. Qualitative work calls
for questions and approaches to be emphasized.

As the previous studies and the methodological approach, stated by the (Newman & Benz ,
1998), they have identified there are multi-focus objectives incorporates with the tactics of
interpretation and naturalism about this topic. Investigators used the natural environment to
study and carry out their research work. The author tries to deduce the phenomenon in terms
of definitions that individuals bring to them with their behavioral patterns.

The research methodology of qualitative approach involves the previous study materials,
research papers and the collection of works of various observed case studies, human behaviors
incorporated with reflective and personal experience.

Many qualitative research studies examine communication patterns or check information

concerning culture or any community. For example, the research can be done anywhere in
hospitals or schools, etc. According to(Holloway, 1997), he stated that the main purpose of
carrying out qualitative research is to examine and observe people's attitudes, perceptions, and
feelings.

A leading qualitative research work provides a comprehensive approach to identify and

understand social reality in life. Studying culture is not only about the studying environment
but also about people's perception, feelings, religious beliefs, norms, reactions, ethics
behavioral patterns, and way of thinking.

It is significant that the researcher needs to gain a solid understanding to study what they are
observing and listening between the lines. In reality, most people are persuaded by their habits
and practices, so this main reason behind qualitative methods which covers the evaluation
process and alter the methods behind a culture or subculture taken by the individuals. This

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work builds on the premise that human beings are better put in their own terms to describe their
experiences and feelings. It is significant that this research work requires a solid framework
that supports and understands the aforementioned criteria, so that researchers must try to find
the contributors' circumstances, opportunities, and behaviors.

3.4 Research Barriers & Limitations

Thus as per the research design, this research work is based on interpretivism. Moreover the
researcher has selected qualitative approach to carry out the research methodology, with
secondary published on the web, data gathered from semi-structured interviews and personal
and over the phone interviews with open-ended questions.

The sampling data gathered of the non-probability will be done due to time and expense
limitations. Therefore, the study of secondary data will be performed on the basis of such data
researcher to draw conclusions and recommendations.

Time is one of the constrain for the justification Using the Secondary Data, as well as
the researcher, has the limitation of traveling due to the current global pandemic, condition to
carried out in-depth analysis with an hypothesis testing for the research question. Therefore as
per existing circumstances the best method to carry out this research is with the existing use
the already existing secondary data.

In addition, as per (Ghauri & Grønhaug, 2005), stated that carry out research with secondary
data available for the general the public is a cost-effective method and much cheaper than the
primary data collected by the researcher himself.

Secondly, the researcher gains advantage with the time constraints, to pay more attention to the
analysis, data reliability, and availability due to the ready availability of the data. With the data
in hand and the researcher, the researcher could spend more time analyzing rather than
gathering primary and secondary data.

As (Collins, 2010), has stated that, it is understood that education or knowledge of theory
contains its own limitations such as nature, scope, and other limiting factors. It is understood
that the main issue in this context of the research study is to derive a conclusion based on a
criterion that is similar to this context of concepts, procedures, and philosophy, could and could
not study the social and natural behavioral sciences. However, in this research study researcher

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believes that the gathered data and resources are highly or is exactly similar or very close to
the natural and social-behavioral scientific situation.

These objectives and the considered objects have a great amount of detached reality, as well as
to that of the researcher and for that purpose of the research study. The researcher will focus
more on the fact that the collected data is more reliable with existing conditions and object-
oriented, and the collected secondary data from published domains and sources could be less
dependent on his feelings so it will be objectivistic. The secondary data collected will be
measured and observed in the form of tables to identify the common patterns. Yet the resources
that are identified and studied as a social phenomenon, with the feelings and attitudes that have
no external reality, while research will have the interpretive philosophy dependent on feelings
and attitude.

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4 Data / Results analysis

4.1 Data Analysis in Terms of the proposed business Idea

4.1.1 Macro Environment Analysis

(Dharmasena, 2017)Explains , With the change of government in 2015 , the country is currently
experiencing a stable political climate and in particular, the pragmatic foreign policies of the
new government and the manner in which it manages ties with the international community is
genuinely beneficial to the country in terms of expanding the tourism industry and attracting
further foreign investments.Economic wise, the county is currently making moderate progress
and due to various issues in budget allocations, issues with contractors etc., most infrastructure
development projects are being put into a temporary pause.The general population is often
impacted by government-imposed high taxes, disrupting their everyday lives and causing them
to allocate less for their recreational activities. This has affected the hotel and tourism industry
in generaland has some impact on the income of the hospitality industry in Sri
Lanka.Considering the 'social' factors affecting this sector, it is notable that the people in Sri
Lanka have adopted a more westernized lifestyle over the last decade or so and have reserved
more time for travel and leisure activities.This phenomenon opened up several opportunities
for the hotel and tourism industry organizations and helped to find further revenue avenues.
Technological growth, in particular in the IT sector, has opened up unexploited markets within
the hotel and tourism industry.Information via portals, online room reservation systems and in
house inventory management systems, are some of the hotel's IT features and the usage of such
technical technologies has had a significant effect on the company's increased revenues.

Figures 4 - 1PESTLE Analysis

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 Political Economic

• About three decades ago Sri Lanka • According to global macro models
led the trade liberalization of South and analysts’ projections, the annual
Asia. The Government has adopted GDP growth rate in Sri Lanka is
approaches and policies that are more forecast to be 1.40 % by the end of
than conducive to foreign investment, this year. Looking forward, estimate
liberalizing many sectors of the Sri Lanka's annual GDP growth rate
economy. The policy climate is, to be at 4.00 in 12 months’ time.
without a doubt, convincing (TRADING ECONOMICS, 2020)
indeed.(The Treasury of Sri Lanka, • 01 USD = 185.15 LKR (as of 29th
2017) May 2020) (Central Bank of Sri
• Political Stability and Absence of Lanka, 2018)
Violence / Terrorism: Sri Lanka's • At an emergency meeting in early
percentile rank was registered at May, the Central Bank of Sri Lanka
49.52 % in 2016, according to World slashed its benchmark standing
Bank development indicators set, deposit facility rate by 50bps to 5.5 %
compiled from officially recognized to assist the economy in weathering
sources. Sri Lanka-Political Stability the adverse economic effect of the
and Violence / Terrorism Lack: COVID-19 pandemic due to subdued
Corruption threats to companies in inflationary pressures. The standing
P a g e 29 | 192
 Sri Lanka are relatively high. lending facility rate was also reduced
Percentile Rank-World Bank's real to 6.5 % by 50bps.(TRADING
values, historical data, forecasts and ECONOMICS, 2020)
estimates came from May • Sri Lanka's annual inflation rate fell
2020.(ECONOMICS, 2020) from 5.4 % in the previous month to
• Corruption risks are moderately high 5.2 % in April 2020. (TRADING
for businesses in Sri Lanka (GAN ECONOMICS, 2020)
INTEGRITY INC, 2019) • Sri Lanka is a high-middle-income
• SAARC Country and UN member, country with an estimated USD 4,030
the Commonwealth of Nations, the (2019) per capita GDP and a total
G77 and the Non-Aligned population of 21.7 million people.
Movement. (World Bank Group, 2020)
• The Government's tariff strategy • In the fourth quarter of 2019, the
seeks to provide a consistent and unemployment rate in Sri Lanka fell
reliable process function for all from 5.10 % in the third quarter of
international exchange stakeholders. 2019 to 4.50 %.(TRADING
Sri Lanka currently maintains a four- ECONOMICS, 2020)
band tariff structure, based on
commodity categories.
(srilankaembassy.fr, 2020)
• Value Added Tax (VAT), Sales Tax,
Personal and Corporate Income Tax,
Economic Service Charge (ESC),
Custom Levy, Remittance Tax, Other
Social Responsibility Fee.(Ministry
of Finance, 2017)
• Sri Lankan labor laws do not
distinguish between foreign or local
employees and apply equally to both,
regardless of whether the
employment is regular, fixed-term,
casual or seasonal. Termination of
the Employment of Workers Act No

P a g e 30 | 192
 45 of 1971 and amendments to this
Act. Jobs & Labor Laws and
Regulations-discuss common
problems in employment and labor
laws and regulations-terms and
conditions of employment,
workplace representation and
industrial relations, discrimination,
maternity and family leave rights,
and business sales specified in
law.(Department of Labour, 2010)
• To resolve investor concerns, Sri
Lanka has open and accountable
investment laws to promote and
secure foreign direct investment as
well as independent courts.(Sri Lanka
Tourism Development Authority,
2019)

Sociological Technological

• Sri Lanka’s population in 2019 was • Sri Lanka’s information technology

21,323,733, a rise of 0.45 % from and business process outsourcing
2018. (Macrotrends LLC, 2020) sector tripled exports and doubled the
• 0-14 years: 23.75% (2.734.114 workforce in just over five years.
males/females 2.627.695) ,15-24 (economynext, 2020)
years: 14.6% (1.677.547 male / • Level of Innovation - In order to push
1.618.922 female),25-54 years: inventions and promote creations
41.46% (4,762,913 male / female while offering security, Sri Lanka has
4,596,388),55-64 years: 10.22 % also implemented a range of policies
(1.067.258 males/1.239.204 and programmers. (Govindaraj,
females),65 years and older: 9.98% 2016)
(2018 est.) (951,213 / female

P a g e 31 | 192
 1,301,338) (2019) (Index Mundi, • Automation - The fourth industrial
2020)(Department of Census and revolution (4IR) is shifting the world
Statistics, 2020) today. Overall, 64% of all migrant
• 98% of people are not interested in travelers have migrated to work. But
becoming businessmen, just workers. traditional employment models are
Service industry is not a major increasingly being replaced by new
choice. (Department of Census and developments linked to 4IR
Statistics, 2017) technologies. In some ways this
• Dangers and annoyances in Sri height of technical progress poses
Lanka, robbery, abuse, scams and inadvertent obstacles.(Lanka
how to safely travel Security in Sri Business Online, 2019)
Lanka (International Labour • Public enquiry into R&D. In
Organization, 2020) compliance with the Democratic
• Private + Government, Hospitals Socialist Republic of Sri Lanka's
high level in line with international Science and Technology
standards and a safe country. Development Act No. 11 of 1994,
(Business Today, 2020) and under the guidance of the
• Sri Lanka is South Asia's most Ministry of Science and Technology,
Westernized nation (National Center the National Science Foundation was
for Biotechnology Information, required to conduct regular National
2015) R&D Surveys. (National Science
• While the majority of the population Foundation, 2020)
is expected to be Buddhists, the • Deployment of new technologies,
dominant cultural values in the such as industrial automation and
population are not in line with that artificial intelligence, is nascent in
thought. Contrary to what the Buddha the manufacturing sector in Sri
had suggested, the status quo is rarely Lanka. But increased productivity of
questioned in Sri Lankan society. labor through automation could in the
Phenomena within the status quo are long run reduce dependence on
what are often challenged. (Wijeya permanent labor. (International
Newspapers Ltd., 2004) Labour Organization, 2019)
• The successive Sri Lankan
governments have taken many

P a g e 32 | 192
 progressive initiatives to develop the
ICT sector in Sri Lanka. ICT has
been found to be beneficial for all
citizens, because ICT can provide
solutions to the different citizens '
needs. (Satharasinghe, 2004)

Legal Environmental

• There is no organized law in Sri • The climate in Sri Lanka is tropical

Lanka regarding age discrimination, and is composed of distinct wet and
there are some laws that provide for dry seasons. In general, Sri Lanka's
the protection of the elderly and coastal areas enjoy an average
provide certain statutory benefits temperature of 28 ° C (82 ° F) while
regardless of the age of the the upland areas are cooler and more
population. The Sri Lankan temperate, with an average annual
government has claimed that these temperature of about 16-20 ° C (60-
guarantees are "'implicit' in the 68 ° C) (Columbus Travel Media
constitution of Sri Lanka and that the Ltd., 2020)
government has not yet written a law • Tropical climate, and the weather is
granting 'explicit' rights. hot and humid all year round. The
Discrimination against sexual nation is to the north of the equator.
minorities remains an issue. (Department of Meteorology, 2016)
(International Labour Organization , • The National Environmental Policy
2020) renews government's pledge to
• Action on anti-competitive activities efficiently manage the environment
that work against the public interest. for the good of present and future
Examinations are conducted by generations, in cooperation with the
themselves to recognize potential public. The aim of this policy is to
anti-competitive activities that exist ensure sound environmental
in the public interest. (Consumer management within a Sri Lankan
Affairs Authority, 2020) Consumer sustainable development

P a g e 33 | 192
 Affairs continues to be the context.(Ministry of Environment
controlling body. and Natural Resources, 2003)
• Sri Lanka’s Employment & Labor • Climate change is a challenge to the
Laws and Regulations tackle the hyper diversity of the island and its
specific employment and labor law marine biodiversity and coastal reef
and regulatory issues. (Department of habitats. Environmental change and
Labour, 2010) increase in sea level have the
• The protection of consumers in the potential to impact the endangered
Sri Lankan system currently depends species overall abundance.(Climate
largely on legislation such as the Links, 2018)
Consumer Authority Act No. 9 of • High pressure from the managed and
2003 (Consumer Affairs Authority, tracked NGOs (MENAFN, 2020)
2020)
• Sri Lanka’s 2003 Intellectual
Property Act No.36 is the structure
under which intellectual property
rights in the Island are currently
secured.(National Intellectual
Property Office, 2020)
• Provides links to the new
international labor standards ILO
information on OSH. ACT, No. 38
OF 2009 (Gazette - Sri Lanka
Government, 2009)

(uk, 2019)(www.bing.com, 2019)

P a g e 34 | 192
Table 4 - 1Sri Lanka Tourist Arrivals by Region (Asia & Pacific) – 2015 to 2018

Region 2015 2016 2017 2018

North America 85,648 99,251 105,297 129,492

Asia & Pacific 893,944 1,022,548 1,054,398 1,091,800

Europe 700,900 804,504 842,868 1,017,861

Middle east 101,066 107,635 95,581 71,636

Others 16,822 16,894 18,263 23,007

Total 1,798,390 2,050,832 2,116,407 2,333,796

(Sri Lanka Tourism Development Authority, 2019) . The year 2019 statistics are provisional
as per (Central Bank of Sri Lanka, 2018)&(Sri Lanka Tourism Development Authority, 2019).
Therefore did not include in the above chart.

Table 4 - 2Sri Lanka - Top Ten Source Markets – 2017-2018

Source Market 2017 Source Market 2018

Arrivals % Arrivals %

India 384,628 18.17 India 424,887 18.2

China 268,952 12.7 China 265,965 11.3

United Kingdom 201,879 9.53 United Kingdom 254,176 10.9

Germany 130,227 6.15 Germany 156,888 6.7

France 97,282 4.59 Australia 110,928 4.7

Australia 81,281 3.84 France 106,449 4.6

Maldives 79,791 3.75 Maldives 76,108 3.3

Russia 59,191 2.80 USA 75,308 3.2

P a g e 35 | 192
 USA 57,479 2.72 Russia 64,497 2.8

Netherlands 51,148 2.42 Netherlands 57,160 2.4

Total 1,411,438 66.69 Total 1,592,366 68.1

(Sri Lanka Tourism Development Authority, 2019). The Year 2019 statistics are provisional as
per (Central Bank of Sri Lanka, 2018)&(Sri Lanka Tourism Development Authority, 2019).
Therefore did not include in the above chart.

Table 4 - 3Distribution of Tourists by Sex and Region -2018

Distribution of Tourists by Sex and Region (2018)

AMERICA 69,311
68,315
AFRICA 7,453
7,420
EAST ASIA 188,135
235,486
OCEANIA 32,425
62,644
SOUTH ASIA 354,712
188,448
NORTHERN EUROPE 169,898
169,149
WESTERN EUROPE 184,074
208,282
CEN / EAST / SOUTH / MEDI EUROPE 135,161
151,297
MIDDLE EAST 39,473
32,199

- 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000

Male Female

(Sri Lanka Tourism Development Authority, 2019)

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Table 4 - 4Distribution of Tourists by Age Group (Percentage) – 2018

Distribution of Tourists by Age Group

(Percentage) - 2018
25
22

20 18
17
16
15
15
12
%

10

0
3-19 20-29 30-39 40-49 50-59 60 & Above
Age Group

(Sri Lanka Tourism Development Authority, 2019)

Table 4 - 5Wellness tourism trips and expenditures by Region, 2015 and 2017

Number of trips (millions) Expenditures (USD

Billions)

2015 2017 2015 2017

North America 186.5 204.1 $215.7 $241.7

Europe 249.9 291.8 $193.4 $210.8

Asia-Pacific 193.9 257.6 $111.2 $136.7

Latin America-Caribbean 46.8 59.1 $30.4 $34.8

Middle East-North Africa 8.5 11 $8.3 $10.7

Africa 5.4 6.5 $4.2 $4.8

Total 691.0 830.0 $563.2 $639.4

(The Global Wellness Institute, 2020)(Kanittinsuttitong, 2018)(Global Wellness Institute ,

2018)

P a g e 37 | 192
Table 4 - 6Top 20 wellness tourism destination market 2017

Number of Trips Direct Employment Expenditure Rank in

(Millions) (Millions) (USD 2017
Billions)

United States 176.5 1.88 226.0 1

Germany 66.1 1.13 65.7 2

China 70.1 1.78 31.7 3

France 32.4 0.31 30.7 4

Japan 40.5 0.18 22.5 5

Austria 16.8 0.16 16.5 6

India 56.0 3.74 16.3 7

Canada 27.5 0.29 15.7 8

United Kingdom 23.2 0.20 13.5 9

Italy 13.1 0.15 13.4 10

Mexico 18.7 0.49 12.8 11

Switzerland 9.7 0.10 12.6 12

Thailand 12.5 0.53 12.0 13

Australia 10.0 0.11 10.5 14

Spain 18.8 0.10 9.9 15

South Korea 19.6 0.13 7.2 16

Indonesia 8.3 1.31 6.9 17

Malaysia 8.3 0.18 5.0 18

Turkey 9.1 0.05 4.4 19

Brazil 10.5 0.13 4.1 20

(Global Wellness Institute, 2020)

P a g e 38 | 192
Table 4 - 7Wellness tourism growth projections

Projected Expenditure Projected Average

(USD Billions) Annual Growth Rate

2017 2022 2017-2022

North America 241.7 311.3 5.2%

Europe 210.8 275.0 5.5%

Asia-Pacific 136.7 251.6 13.0%

Latin America – Caribbean 34.8 54.7 9.5%

Middle East – North Africa 10.7 18.7 11.8%

Africa 4.8 8.1 11.1%

Total Wellness Tourism Industry 639.4 919.4 7.5%

(Global Wellness Institute, 2020)

Table 4 - 8Top 10 Dark Tourist Destinations in the world. (2010)

Destination Rank in 2010

Dharavi Slum, Mumbai, India 10

Cu Chi Tunnels, Saigon, Vietnam 9

Tuol Sleng Genocide Museum, Phnom Penh, Cambodia 8

Devil’s Island, French Guiana 7

London Dungeon, UK 6

The Zone of Alienation in Chernobyl, Ukraine 5

Auschwitz Concentration Camp, Poland 4

The River Kwai Bridge, Thailand 3

Ground Zero, New York City, USA 2

Pont de l’Alma Road Tunnel, Paris, France 1

(Happy, 2010)
P a g e 39 | 192
4.1.2 Industry Environment Analysis

Business environment is a mixture of various forces or environments that affect business

operations.(Steven, 2020)You can divide the business environment into internal environment
and external environment. The internal climate is the world that is controllable and that
determines the strengths and weaknesses. The structure of the organization, picture,
creditworthiness. There are some internal environmental considerations. The external
environment can be described as the world that is beyond an organization’s control. By
analyzing that environment, the opportunities and threats can be measured. Outside climate can
be divided into the job environment and social atmosphere again.Shareholders, consumers,
families, investors, government, market organizations are some of the factors involved in the
task environment, and political powers, economic, technical, and socio-cultural forces are the
factors that fall under the social climate.As these external forces are uncontrollable, an entity
will respond to their changes. Through this essay, the author will address the effect of the
Changes in the external environment on the Sri Lankan tourism industry.

Table 4 - 9Class of Accommodation of Establishments by Category- 2018

Class of Accommodation No of Units Occupancy

%

5 Star 23 73.13

4 Star 21 72.31

3 Star 24 72.95

2 Star 38 72.39

1 Star 39 73.58

Small luxury Hotel (Boutique Hotel / Villa) 71 71.51

Unclassified 241 73.54

Total 457 72.77

(Sri Lanka Tourism Development Authority, 2019). The Year 2019 statistics are provisional
as per (Central Bank of Sri Lanka, 2018)&(Sri Lanka Tourism Development Authority, 2019).
Therefore did not include in the above chart.

P a g e 40 | 192
Table 4 - 10Accommodation Capacity (Rooms) in Tourist Hotels and its Regional
Distribution -2018

Region Rooms Occupancy

%

Colombo City 5,607 79.17

Greater Colombo 3,269 75.41

South Coast 8,676 73.10

East Coast 1,149 71.35

High Country 1,489 71.67

Ancient Cities 4,360 71.37

North Regent 207 68.48

All Region 24,757 72.77

(Sri Lanka Tourism Development Authority, 2019). The year 2019 statistics are provisional as
per (Central Bank of Sri Lanka, 2018)&(Sri Lanka Tourism Development Authority, 2019).
Therefore did not include in the above chart.

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Table 4 - 11India – Tourism (Statistics) 2019

Number Annual
Millions Growth
India
Rate

Number of Foreign tourist arrivals in India (million) 10.56 5.2%

Number of non-residents Indians arrivals (million) 6.87 1.4%

Number of international tourist arrivals in India (million) 17.42 3.7%

(Ministry of Tourism - Government of India, 2020)

Table 4 - 12 India - Foreign tourist arrivals from top 15 source markets (2019)

India - Foreign tourist arrivals from top 15 source markets Million % Share
(2019)

Bangladesh 2.26 21.37%

United States 1.46 13.80%

United Kingdom 1.03 9.75%

Sri Lanka 0.35 3.35%

Canada 0.35 3.32%

Australia 3.34 3.28%

Malaysia 0.32 3.02%

China 0.28 2.67%

Germany 0.27 2.60%

Russian Fed 0.26 2.48%

France 0.26 2.48%

Japan 0.24 2.24%

P a g e 42 | 192
 Singapore 0.18 1.74%

Nepal 0.17 1.65%

Thailand 0.16 1.58%

(Ministry of Tourism - Government of India, 2020)

Table 4 - 13 Maldives Tourism Statistics 2019

1,702,831 tourist arrival to the Maldives in year 2019, (14.7% increase compared to 2018) from
Europe (49%) with a 14.8% increase and 833,904 tourists, Asia & the Pacific (41.4%). There
were 705,117 American countries (5%) with 84,793 tourists, Middle East (3.5%) with 60,003
tourists and Africa with 18, 698 tourists. The top 10 country-wise markets were China (16.7%),
India (9.7%), Italy (9.7%), Germany (8%), UK (7.7%).The most significant increase in 2019
tourist arrivals was from India with 166,015 tourists and an 83.5% increase compared to the
previous year.(Corporate Maldives, 2020)

P a g e 43 | 192
Figures 4 - 2Potters 05 forces

Power of Suppliers Power of Buyers/ Customers

Land owners, developers, construction firms, While numerous types of consumers exist,
interior design services companies, they can generally be categorized into two
marketing, simple hotel / motel workers. categories for both the travel and
Airlines, car rental services, buses and so on. hospitality sectors.

Luxury consumer–These types of

customers want a better experience with
their itinerary or their stay.They don't
mind paying the extra bucks to encounter
the best possible.

Budget consumer–These consumer forms

want an ideal experience at a limited
budget.

Competitive Rivalry Threat of New Entrants

Hotel chains like, Shangri-La Hotel, Centara Aside from the Sri Lankan chains, several
Ceysands Resort & Spa, Marriott Resort & foreign companies plan to expand their
Spa, Hotel Riu , Best Western Elyon, Hilton , operations by offering their services in the
Mövenpick,Grand Hyatt, AVANI Resort, tourism and hospitality sector in Sri

P a g e 44 | 192
Park Inn By Radisson (Trip2Lanka.com, Lanka.Innovative services are also being
2020)are among many others that cater for the established by entrepreneurs in the tourism
luxury segment in the hospitality industry.A and hospitality sector, despite the amount
lot of local hotels cater for the budget segment of room for future development. Hotel
in the unorganized style. chains such as ITC, NEXT, Radisson’s
Park Inn, Ritz Carlton, Sheraton, Hyatt,
Marino Sands and Four Seasons Hotel will
soon begin operations. Cinnamon Life
(800), Hyatt (559), ITC (300), Marino
Sands (270), NEXT (200), Radisson (300),
Ritz Carlton (200), Shangri-La (550 –
already in operation), Welcome Hotel
(300), Sheraton (306) and 4 Seasons (350)
are adding new spaces.(Trip2Lanka.com,
2020)

Availability of Substitutes

Although there is nothing that can be defined as a direct replacement for the hospitality and
travel industry as such, the entertainment industry is something people choose to spend
their money on. A weekend get-away to a theme park or amusement park, for example,
may be considered a replacement for heading to a nearby hill station or a popular weekend
location.However, there is very little correlation between the two sectors and the Travel
and Hospitality industry has pushed up the household spending priorities list.

(Best of Lanka, 2020) Explains the wellness (well-being) hotels in Sri Lanka. Talalla
Retreat (Talalla Retreat, 2020), Santani Wellness Resort & Spa (Santani Wellness Resort,
2020), Tri Lanka (Trilanka.com, 2018), Villa Arunalu (Villa Arunalu, 2015), Plantation
Villa (Plantation Villa, 2017), Siddhalepa Ayurvedic Resort (Siddhalepa Resort,
2020),Kalenduwa Retreat,Sen Wellness Sanctuary (Sen Wellness Sanctuary, 2020)

P a g e 45 | 192
4.1.3 Market Analysis

Trends and forecasts for the hospitality industry in Sri Lanka (2020-2025) explained by
(Mordor Intelligence, 2020). The country has been welcoming an increasing number of tourists
to the highly diverse landscapes and natural attractions in Sri Lanka. In 2018, the total number
of tourist arrivals to Sri Lanka amounted to over 2.3 million, which in 2017 was 2.17
million.The revenue generated by travel and tourism remained a high contributor to the national
economy, with a 5.1 % contribution to GDP for two consecutive years, i.e. 2017 and 2016. For
2017.Tourism sector foreign exchange earnings rose in 2017 to 15.9 % of total foreign
exchange earnings. To accommodate the rising number of tourists, Colombo has in the pipeline
more than 14 hotel construction projects which are scheduled to open by 2022.This pipeline
targeted the hotel market's luxury segment and aimed to add some 2,000 rooms to the supply,
with less focus on the budget and mid-scale segment with around 600 rooms to be added to the
supply.In 2018, the country recorded average daily income (ADR) of LKR 20,500, and revenue
of LKR 12,300 per available room (RevPAR). Sri Lanka reported about 60 % of the occupancy
rate for the same year, but all key indicators registered less figures compared to 2018 due to
the Easter terror attacks in April 2019.

P a g e 46 | 192
Figures 4 - 3The 7 Ps of marketing

Product
The product here exemplifies the goods and services that a company sells to its potential
client. To peddle the sale, one must provide the targeted customer with the proper and
adequate information about their particular good and service.The product has to be able to
meet and satisfy the customer's requirements. Component of selling the good includes
figuring out the market's potential buyers.(NEELAM, 2018)

Price
The chunk of money a supplier sets as a price for his product is labeled. Setting the price
needs to be keen on thinking and analyzing, mainly for inexperienced or new business
owners who mistakenly feel they are offering the minimum price or would end up attaining
nil sales. In other ways pricing is measured, like cost-plus, based on demand or combative.
(NEELAM, 2018)
Place
The way the product is sold is seen as the third 'P' of marketing seen as a location. Analysis
of the geographical areas where purchasers are searching for the product and service. It refers
to the geographical position where goods are available. (NEELAM, 2018)

P a g e 47 | 192
 Promotion
The “promotion” element in the marketing mix includes the advertising and events to support
the particular service and product. Various tactics are being put in motion to sell the drug on
the market. To make the end consumers aware of the drug marketers implement various
advertising campaigns to retain their products and services. (NEELAM, 2018)

Process
The process is an integrated exposure to purchases. From the prime contact segment,
generally the network or website, to the goods or services being distributed. Nonetheless, the
process doesn't obstruct there, because there is the post-sales operation, and even after the
buying process, it establishes good relationships with consumers. (NEELAM, 2018)

People
In a service delivery process, people are a defining factor, since a service is inseparable from
the person providing it. Thus, a hotel is known for its food as well as for the quality its staff
offers. The same is true of department stores and banks. As a result, staff customer service
training has become a top priority for today's many organizations. (NEELAM, 2018)

Physical evidence
It must be delivered first, before a service is experienced. Therefore, it means the method of
deciding to use a service may be considered as risky when one buys something that is
intangible. Scientific proof such as case studies can be used to reduce this ambiguity.This
can be done by keeping the facilities clean, tidy and well decorated. The physical evidence
an organization demonstrates should be able to confirm the customers' assertions. Although
customers may not be able to experience the service before they have purchased it, the
customers can talk with experience to other customers! (NEELAM, 2018)

P a g e 48 | 192
Table 4 - 14Percentage Distribution of Tourist Arrivals by purpose of Visit- 2007- 2018
Purpose 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Pleasure / 67.4 67.1 73.2 80 78.9 80.4 74.4 72.7 67.95 66.6 83.4 82.4 81.72
Holiday
Business 17.8 10.5 8.5 8.6 12.7 8 9 5.2 1.33 1.3 1.8 3.3 3.95
Visiting 7.6 8.3 8.3 5.2 5.4 8.2 11.7 12.4 27.45 25.5 11.5 11.3 10.84
Friends &
Relations
Convention 3 1.5 1.3 1.4 1 1.7 2.2 2 0.29 0.2 0.8 1.3 1.71
& Meeting
Religious 1.7 2.8 2.6 2 0.8 0.3 2.2 4.8 0.01 0.1 0 0 0.09
& Cultural
Health 0.53 3.2 0.6 0.5 0.89
Sports 0.53 0.7 0.4 0.8 0.64
Official 0.3 0.4 0.3 0.3 0.06
Education 0.11 0.2 0 0.1 0.06
Others 2.5 9.8 6.1 2.8 1.2 1.4 0.5 2.9 1.49 1.7 1.2 0 0.04
Total 100 100 100 100 100 100 100 100 100 100 100 100 100

(Sri Lanka Tourism Development Authority, 2019)(Department of Immigration and

Emigration, 2020) The Annual Statistical Reports of 2019 are not yet published and 2019 &
2020 numbers are provisional as per the Central Bank Annual report of 2019.

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Table 4 - 15Tourist Arrivals by Country of Residence & purpose of Visit – 2018
Country of Total Pleasure / Visiting Business MICE Health Sports Education Religious Official Others
Residence Vacation Friends &
Relatives
AMERICA 137,624 81,231 48,675 4,159 2,489 259 688 80 31 3 9
NORTH AMERICA 129,492 74,152 48,234 3,928 2,204 248 614 74 26 3 9
Canada 52,681 18,728 32,542 747 448 79 123 10 4 1 0
Mexico 1,503 1,322 52 42 56 2 26 3 0 0 0
United States 75,308 54,103 15,640 3,139 1,700 167 465 61 22 2 9
CARIBBEAN AND 910 741 80 33 43 1 11 0 1 0 0
CENTRAL
AMERICA
Costa Rica 132 103 10 14 5 0 0 0 0 0 0
Jamaica 102 80 8 1 12 0 1 0 0 0 0
Others 676 558 62 18 26 1 10 0 1 0 0
SOUTH AMERICA 7,222 6,338 361 198 242 10 63 6 4 0 0
Argentina 1,809 1,598 81 13 94 0 23 0 0 0 0
Brazil 2,774 2,470 103 98 70 4 22 3 4 0 0
Chile 1,002 910 46 15 28 3 0 0 0 0 0
Columbia 702 596 55 18 25 1 7 0 0 0 0
Others 935 764 76 54 25 2 11 3 0 0 0
EUROPE 1,017,861 873,337 103,399 14,961 8,366 13,219 4,006 426 22 9 45

P a g e 50 | 192
 Country of Total Pleasure / Visiting Business MICE Health Sports Education Religious Official Others
Residence Vacation Friends &
Relatives
NORTHERN 339,047 270,830 54,659 6,539 4,112 718 1,883 258 16 0 32
EUROPE
Denmark 19,223 16,070 2,509 344 112 153 32 3 0 0 0
Finland 8,888 8,322 357 132 37 22 13 3 0 0 2
Norway 17,217 11,073 5,517 302 244 39 30 7 3 0 2
Sweden 28,267 25,070 2,207 496 325 123 33 1 0 0 12
United Kingdom 254,176 200,129 43,372 5,051 3,260 355 1,745 238 13 0 13
Others 11,276 10,176 697 214 134 26 30 6 0 0 3
WESTERN 392,356 339,977 34,299 4,150 2,135 10,787 897 96 2 3 10
EUROPE
Austria 19,320 17,327 524 118 102 1,198 35 16 0 0 0
Belgium 17,519 16,340 665 273 140 79 22 0 0 0 0
France 106,449 93,937 10,245 1,002 502 241 496 24 1 0 1
Germany 156,888 134,475 12,539 1,405 806 7,407 206 44 0 3 3
Netherlands 57,160 52,290 3,108 1,030 403 250 65 11 0 0 3
Switzerland 33,965 24,653 7,180 312 182 1,564 69 1 1 0 3
Others 1,055 955 38 10 0 48 4 0 0 0 0

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 Country of Total Pleasure / Visiting Business MICE Health Sports Education Religious Official Others
Residence Vacation Friends &
Relatives
CENTRAL / 176,905 163,817 8,998 1,136 705 1,342 852 54 0 0 1
EASTERN
EUROPE
Belarus 4,621 4,273 291 11 27 12 7 0 0 0 0
Czech Republic 17,600 17,041 301 73 45 105 32 2 0 0 1
Estonia 2,744 2,673 34 14 8 13 1 1 0 0 0
Hungary 4,514 4,283 117 60 29 19 4 2 0 0 0
Kazakhstan 2,721 2,400 251 13 23 29 5 0 0 0 0
Lithuania 3,386 3,258 68 30 16 13 0 1 0 0 0
Poland 20,378 19,212 727 213 75 100 49 2 0 0 0
Romania 5,931 5,406 335 72 55 23 40 0 0 0 0
Russian Federation 64,497 60,015 3,187 252 123 413 452 38 0 0 0
Slovakia 5,289 4,789 55 20 15 405 5 0 0 0 0
Ukraine 36,515 32,729 3,124 192 156 146 165 3 0 0 0
Others 8,709 7,738 508 186 133 47 92 5 0 0 0
SOUTHERN / 109,553 98,713 5,443 3,136 1,414 443 375 18 4 6 2
MEDITERRANEAN
EUROPE
Greece 7,778 6,406 263 760 320 12 17 0 0 0 0

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 Country of Total Pleasure / Visiting Business MICE Health Sports Education Religious Official Others
Residence Vacation Friends &
Relatives
Israel 13,793 12,693 708 206 79 11 86 6 4 0 0
Italy 38,379 33,309 3,195 1,170 389 217 85 8 0 6 0
Portugal 5,933 5,489 202 145 77 8 12 0 0 0 0
Spain 29,208 27,756 625 454 203 77 89 2 0 0 2
Turkey 4,262 3,431 189 299 256 28 59 0 0 0 0
Others 10,200 9,629 261 102 90 90 26 2 0 0 0
Middle East 71,636 63,453 5,454 390 473 299 1,546 16 0 5 0
Bahrain 2,858 2,553 210 29 23 33 10 0 0 0 0
Egypt 3,854 3,354 155 132 100 8 100 4 0 1 0
Iraq 1,021 933 22 7 26 0 33 0 0 0 0
Jordan 3,156 2,841 93 44 96 6 76 0 0 0 0
Kuwait 3,465 3,049 339 13 0 15 41 8 0 0 0
Lebanon 5,521 5,219 117 55 60 18 51 0 0 1 0
Oman 6,846 6,112 530 28 68 8 100 0 0 0 0
Qatar 1,676 1,411 199 2 12 0 52 0 0 0 0
Saudi Arabia 34,703 30,393 3,029 47 44 190 993 4 0 3 0
United Arab 5,785 5,119 593 11 5 5 52 0 0 0 0
Emirates
Others 2,751 2,469 167 22 39 16 38 0 0 0 0

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 Country of Total Pleasure / Visiting Business MICE Health Sports Education Religious Official Others
Residence Vacation Friends &
Relatives
AFRICA 14,877 11,790 1,118 633 876 38 398 3 10 4 5
NORTH AFRICA 2,991 3,677 152 65 54 8 34 0 0 1 0
Morocco 1,036 947 61 10 7 8 3 0 0 0 0
Sudan 858 761 20 36 14 0 27 0 0 0 0
Others 1,097 969 71 19 33 0 4 0 0 1 0
SUB - SAHARAN 11,886 9,113 966 568 824 30 364 3 10 3 5
AFRICA
Kenya 874 979 110 59 111 0 15 0 0 0 0
Mauritius 720 512 122 44 25 4 10 3 0 0 0
Nigeria 412 152 26 70 160 0 2 0 2 0 0
South Africa 7,416 6,414 379 214 157 9 235 0 8 0 0
Others 2,464 1,456 329 118 371 17 102 0 0 3 5
ASIA & PACIFIC 1,091,798 877,249 94,420 71,991 27,637 6,912 8,304 979 2,015 1,453 838
NORTH EAST 339,558 315,867 6,573 11,312 4,079 971 591 99 13 3 50
ASIA
China 265,965 256,011 2,700 4,609 2,276 43 224 77 6 0 19
Japan 49,450 40,087 2,324 4,850 1,026 901 213 13 3 3 30

South Korea 15,748 12,457 1,235 1,464 462 18 110 0 1 0 1

Taiwan 8,187 7,206 305 375 247 9 33 9 3 0 0

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 Country of Total Pleasure / Visiting Business MICE Health Sports Education Religious Official Others
Residence Vacation Friends &
Relatives
Others 208 106 9 14 58 0 11 0 0 0 0
SOUTH EAST 84,013 59,282 7,968 9,371 5,064 84 896 71 838 104 335
ASIA
Cambodia 771 567 71 9 112 0 10 0 0 2 0
Indonesia 5,365 3,258 756 453 628 17 234 0 16 0 3
Malaysia 22,808 16,794 2,547 2,168 1,012 42 214 22 2 0 7
Myanmar 3,241 2,631 202 112 277 0 19 0 0 0 0
Philippines 19,303 13,197 3,065 1,290 1,496 23 220 6 0 0 6
Singapore 19,861 12,671 417 4,647 854 0 0 40 815 102 315
Thailand 9,178 7,546 620 462 387 1 159 2 1 0 0
Vietnam 3,189 2,448 256 210 234 1 33 1 4 0 2
Others 297 170 34 20 64 0 7 0 0 0 2
SOUTH ASIA 543,160 418,764 43,334 49,157 16,528 5,663 6,008 777 1,150 1,338 441
Afghanistan 861 226 18 16 564 1 36 0 0 0 0
Bangladesh 10,487 7,422 1,019 762 940 0 287 5 0 0 52
Bhutan 679 362 126 43 124 0 17 0 0 2 5
India 424,887 337,557 35,464 37,968 9,557 131 3,652 456 60 32 10
Iran 5,720 4,368 749 413 146 0 11 0 0 0 33
Maldives 76,108 51,394 3,577 8,220 3,273 5,490 1,142 302 1,068 1,304 338

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 Country of Total Pleasure / Visiting Business MICE Health Sports Education Religious Official Others
Residence Vacation Friends &
Relatives
Nepal 5,302 3,096 746 256 907 4 281 6 4 0 2
Pakistan 19,116 14,339 1,635 1,479 1,017 37 582 8 18 0 1
OCEANIA 125,067 83,336 36,545 2,151 1,956 194 809 32 14 8 12
Australia 110,928 73,458 32,987 1,875 1,650 165 720 32 14 7 9
New Zealand 13,825 9,747 3,504 255 217 19 80 0 0 0 3
Others 314 131 54 21 99 0 8 0 0 1 0

Total 2,333,796 1,907,060 253,066 92,134 39,843 20,798 14,942 1,504 2,078 1,474 897
(Sri Lanka Tourism Development Authority, 2019). The Annual Statistical Reports of 2019 are not yet published and 2019 & 2020 numbers are
provisional as per the Central Bank Annual report of 2019. (Department of Immigration and Emigration, 2020)

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Table 4 - 16Tourist Arrivals by purpose of Visit – 2018

Purpose of Visit Tourist

Arrivals
Pleasure / Vacation 1,907,060
Visiting Friends & Relatives 253,066
Business 92,134
MICE - Meetings, Incentives, Conferences, and Exhibitions 39,843

Health 20,798
Sports 14,942
Education 1,504
Religious 2,078
Official 1,474
Others 897
Total 2,333,796
(Sri Lanka Tourism Development Authority, 2019) The Annual Statistical Reports of 2019 are
not yet published and 2019 & 2020 numbers are provisional as per the Central Bank Annual
report of 2019. (Department of Immigration and Emigration, 2020)

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4.1.4 SWOT Analysis

Figures 4 - 4 SWOT Analysis

Throughout its quest to achieve sustainable economic development, the Sri Lankan government
has already defined "tourism" as a prior industry. Nevertheless, mass tourism has its own
detrimental impacts such as destruction of the environment and socio-cultural aspects. Tourists
are becoming increasingly environmentally oriented as a result of increased global awareness
about environmental issues.(Watermark theme, 2012). Against this backdrop, Well-Being &
Dark Tourism has emerged as an alternative type of tourism that aims to reduce the negative
impacts of mass tourism while providing host communities with sustainable revenue. In
planning and developing a key sector such as Well-Being & Dark Tourism assessing the
strengths, weaknesses, opportunities and threats of the ecotourism sector, i.e. conducting a
SWOT analysis to gain a broader picture is crucial.SWOT analysis can serve as an excellent
decision-making tool for policy makers. Below are the strengths, weaknesses, opportunities,
and threats for the Bandu Well-Being & Ayurveda Spa Resort.

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 Strengths Weaknesses
• Accommodation facilities to meet • Absence of a national ecotourism
international standards policy
• Aquatic ecosystems • Business Model Limits Growth
• Ayurveda Doctors & authentic • High Room Rate and Limited
traditional medicines of Sri Lanka Number of Rooms
• Diverse landscape • Limited Professional Hospitality
• Existing tourist markets Training
• High biodiversity • Transportation Inconvenience
• Historical and cultural diversity • Weak Online Presence
• Institutional structure to facilitate
tourism sector growth and
development including Well-Being
& Dark Tourism
• Location
• No Surcharge
• Organic Healthy Food and Cooking
Methods
• Skilled labor force for the hospitality
industry
• Special service
• The USPs of Dark Tourism & Well-
being Tourism
• Unique Design
• Wide range of terrestrial ecosystems

Opportunities Threats
• Tourism Promotion Initiatives by the • Chances for new market
Local Government opportunities and tourism products
• Trend on the Rise • Intense Growing Competition
• The demand for wellness (well- • Manger in diversification of tourism
Being) tourism in the world products

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 • The demand for the Dark Tourism in • Unstable regulation and environment
the world

(Yan, 2018)

Figures 4 - 5unique selling proposition (USP)

Unique sales proposition (USP) is the main competitive advantage and the one thing that makes
the hotel stand out in the marketplace. It's what the hotel offering that no one else does, whether
it's a higher quality, a lower price, or something that no one else has.(Flempire Industries,
2018).

What customers want? What you do well?

By analyzing the tourist arrivals and “Bandu Well-Being & Ayurveda Spa
purpose of the tourists, mainly it’s for Resort” name itself mentioned the
pleasure and holidays (81.72% - 1,907,060 “Well-Being” concepts. The concept of
in 2018) and Health (0.89% - 20,797). “Dark Tourism” and authentic
When further analyzed from which traditional medicines of Sri

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 countries the tourists have arrived for Lankaalso included. As mentioned in
health, there are from Europe and 2.1, Hotel will give the uniqueness and
Developed countries. It’s obvious that is attention to details for each and every
for Ayurveda Treatments and Healings. guest needs.
(Sri Lanka Tourism Development
Authority, 2019) .

What your competitors do well?

As per the observations, the competitor’s hotels also have wellness concepts, yoga,
Ayurveda spa, mediation and specialized food.

Figures 4 - 6Hotel Marketing Mix

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 Service / Facilities Promotion & Communications
05 Star Luxury Facilities in line with • Use of SEO – (Search engine
International Hotel Standards (Lecocon optimization)
Boutique Hotel, 2019) • Use of social media
Facilities • Offer discounts
• Hotel Blog
• Tour desk
• Digital Signage
• Luggage storage
•
• Business center
• Parking (Business Matters, 2019)
• Souvenir
• Outdoor swimming pool
• Complimentary Tea/Coffee maker
• Complimentary 02 bottle of pure
drinking water
• Complimentary Wi-Fi internet access
(with the concept of dark tourism ,
only available at Front Office)
• Personal safety box
• Mini bar
• LCD TV (cable)
• Hair dryer
• Quality toiletries
• Shower or Bath
• Direct number telephone line in room
–(Restricted and allowed case by
case)
• Ironing facility
• Slipper
• Bathrobe

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 Services

• 24 hour reception
• 24 hour concierge
• 24 hour security
• Spa / Ayurveda Center
• Foreign exchange service
• Car rental service with driver
• Dry and Laundry service
• Complimentary in room fruit
• Airport pick-up and drop-off service
is available (Surcharge)
• Complimentary daily buffet
breakfast
• Children under age of 12 will be
provided free of charge
accommodation using an existing bed
with parent.
• An extra bed may be provided for the
3rd person

Room Rate / Pricing Target Market / Place & Distribution

Pricing can be vary of the type of room, value Europe, USA, UK, Australia, Russia, China.
of service you provide, Occupancy % , (High Spending Guests / Travelers).
Sections of the guests , local-market demand (Cloudbeds, 2019)
and supply, Prizing competition, Seasonality,
And even on a weekday(Bhatnagar, 2016)

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Figures 4 - 7 “7-S” Framework for a Hotel

Structure System Style

Directors / Owners , General IT System - Front Office - No bureaucracy. Leadership
Manager of the new hotel , (Oracle, 2020), Opera PMS style bottom-up. Atmosphere
Departmental Managers , (Oracle), Micros Simphony within the hotel is formal and
Assistants to the POS (Oracle) hierarchical.
Departmental Managers 5.1 Finance & Accounting -
Strategic Business Unit (SunAccounts, 2020)- Sun
Plan (SBU Plan) Accounting System, (Oracle,
2020) Material Control for
inventory control.
Human Resources -
(Hospitality Technology,
2017)Fusion for HR.5
Discussion, Conclusions &
recommendations

P a g e 64 | 192
 Staff Skills Strategy
5.1 Strategic Business Unit Staff training and To be the market leader in the
Plan (SBU Plan) explains development programs, Boutique Hotel Sector. To
the SBUs and List of Staff) – leadership programs, on the expand the unique concept of
staff policy – Open Door job training, development of well-being & Dark Tourism
Policy soft skills will be there. with authentic traditional
medicines of Sri Lanka.

(Balanced Scorecard (KPIs) for Hotel, 2019)

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4.2 Risk Assessment
Risk Probability Impact of the Risk Proposed Actions to Eliminate / Mitigate
of the Risk
Occurrence
1. STRATEGIC AND Medium Detailed budgets for operating and capital
MARKET RISKS spending shall be prepared annually and
1.1 Business Risk formally approved by the Board. Then, the
The Hotel’s failure to meet its Reduced profits, cash flow and productivity- Board tracks and updates these plans in order
market goals Hinder potential growth to evaluate actual results against those
expected and take remedial measures where
appropriate.
Feasibility analyses of the projects are
carried out for all big investments
Implementation of cost management
processes and creative energy-cost-saving
programs
Analyzing the Opponent

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1.2. Political, Economic and Medium Decreased sales, increased operating costs The management monitors political and
Environmental Risks leading to reduced productivity and cash economic trends on a regular basis and tries
flows-Asset ownership management to recognize emerging threats as soon as
The Community is affected by possible
significant events affecting either Being a member of the Sri Lankan Tourist
economic or political stability at Events can reduce domestic or international Hotels Association and working closely with
global and local level travel can adversely affect occupancy and them and other various trade unions, related
room rates. These incidents can include authorities and lobby groups in order to
Events which affect domestic or terrorist attacks, war or perceived increased always create a better economic climate.
foreign travel risk of armed wars, epidemics, natural
disasters, higher transportation costs and The hotel has contingency and recovery
industrial action. Decreased demand would plans in place to enable it to respond to major
affect sales and operating profitability emergencies or incidents.

Risks resulting from natural or Loss of Assets Insurance policy shifts liabilities to third
man-made disasters parties. Insurance cover adequacy is checked
and changed regularly as appropriate.

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 Future operating performance may be Providing special quality of service
1.3. Competitive Risk High negatively influenced by room overcapacity associated with brand Bandu River Inn.
Hotel is subject to the risks of the in the industry. Consistently providing the standard of
supply and demand process of the lower market share (lower occupancies) and service to influence customer preference and
hotel industry, such as prices resulting in lower sales , higher to build and sustain perception of value.
competitive behavior by existing marketing costs decreased cash flows and Allow timely investments in infrastructure
hotels and new entrants, which profitability upgrades
increase the supply of rooms Keep long term ties with major tour
operators

2. OPERATIONAL RISKS Medium Ongoing tracking and analysis of consumer

2.1. Reputation and Intellectual The level of service cannot be given in feedback and ratings online.
Property Rights Risk keeping with the Bandu River Inn Investments to protect the Group’s brand
The Group is dependent on its requirements from misuse and violation, by way of
brand image and the defense of its High mark value, market share, sales, registration of trademarks and enforcement
intellectual property rights productivity and cash flow of domain names.
Greater vulnerability of the Company to Monitoring adherence to Group safety,
lawsuits operational and quality standards or the
relevant regulations for hotel operations.

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 Provide regular training for employees to
educate in the hospitality industry on the
quality requirements and new technologies.

The Group and hotels are well served at trade

2.2. Demand Medium Reduce sales, room hours. fairs around the world.
Adverse effects on Group Owing to the high occupancy lower room Increase membership with Online Travel
turnover as demand moves from levels. Agents.
conventional source markets to Boost social media visibility.
new emerging markets. Maintain long term relations with major tour
operators.

Creation and preservation of a Community

2.3. Employee Risk Medium Inability to attain planned market objectives. culture, compensation and benefits
Failure to recruit and retain skilled Reduced levels of service contributing to agreements, training and growth are key
employees will threaten the lower guest satisfaction. tasks carried out.

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success of operations within the Intelligence wrong. Initiate Bandu River Inn Youth Development
Company. Project.

Daily device updates and upgrades where

applicable.
New technology deployment where feasible
2.4. Technology Risk Medium It would adversely affect the Group's identity and necessary.
The inability to adopt new and results.
technology or correctly apply To make efficiency worse and to lose
current technology. competitive advantage. In consultation with the stakeholders,
develop project costs and timelines.
Track project progress with expense and time
2.5. Project Implementation Risk High Overruns the expense. budgeted.
Imprecise cost and time estimates Delays in implementing projects will result Group continues monitoring changes in the
of the project. in loss of earnings. regulatory climate it works in.
Every quarter a formal statement shall be
2.6. Statutory and Legal Risk High Legal fees and penalties which lead to made to the Board.
Danger of action due to reduced profitability. The scope of the Internal Audit system
noncompliance with legal and Adverse reputational effect. requires compliance audits.
regulatory criteria. Loss resulting from faulty contracts.

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 Hire qualified advisors to review contracts.

Outsource internal audits to professional

accounting firms to review and report on
2.7.Internal Operational Processes Medium Faults in internal processes. financial and organizational management
Financial loss threat from Betrug. adequacy.
deterioration of internal controls. Data failure. There are specified processes and procedures
in place to ensure internal controls are
complied with.
Adequate coverings are obtained for fidelity.

3. FINANCIAL RISKS Reduce performance.

3.1. Credit Risk Low Raising working capital.
Threat that occurs because of Credit is only given to licensed credit agents.
payment default.

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 Credit approval is given at "Bandu River
Inn" by the credit committee, and a credit
approved list has been prepared.
Debtors are constantly tracking and
3.2. Exchange Rate Risk High Impact of translation of foreign currency evaluating.
Danger resulting from the transactions on profitability.
uncertainty of the fair value or In USD, enter into sales contracts with tour
potential cash flows of a operators / agents as much as possible.
fluctuating financial instrument Take regular tracking of exchange rates.
attributable to market interest rate
shifts.

3.3. Interest Rate Risk High Rentability decreased.

Danger resulting from the Cash flows decreased.
uncertainty of the fair value or Negotiate favorable terms and conditions
potential cash flows of a with the banks for received lending facilities.
fluctuating financial instrument

P a g e 72 | 192
attributable to market interest rate
shifts.

3.4. Liquidity Risk Medium Cash flows decreased. Preparation of daily cash flow estimates
Risk that the Group may not fulfill Rentability decreased. according to expected occupancy
its financial obligations when they fluctuations to determine the group’s
fall due. liquidity role in the short term.
Daily monitoring and checking of bank
balances.
Monthly preparedness and review of real
results against the budget.

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4.3 Critical Success Factors

Location

Traditionally, the hotel industry has focused on location as the most critical factor in success.
Despite the industry's changes, localization is still necessary.A hotel on a little-used highway
is unlikely to do very well, even though it provides superior service and amenities. Though the
location remains very important, other factors are significant. Travelers used to take it as a
matter, of course, that hotel service would vary considerably depending on location, but this is
no longer the case.(Thompson, 2020).

The selected location is Athwelthota, Kalutara District, Western Province of Sri Lanka which
is a remote village surrounding waterfalls and natural beauty. Further, it’s close to the
(Sinharaja Forest , 2020)Reserve, the Sri Lanka extensive tract of undisturbed tropical
rainforest which is spread over 11,187 Hectares.

Global outlook

In order to be competitive even small, locally owned hotels need to be able to compete
internationally. Tourists who decide where to take their next vacation can choose from
destinations around the world, and when making their selection, they can easily research the
quality of local hotels.If a hotel tries to compete exclusively on price and location while a
nearby competitor also emphasizes creating a quality customer experience, then visitors go to
the latter. Hotel owners need to be aware of what hotels are doing all over the world to attract
new customers and earn loyalty. (Thompson, 2020).

Mix concepts of “Well-Being & Dark Tourism” including authentic traditional medicines of
Sri Lanka with 50 Cottages as a Boutique Hotel with 05 Star Luxury will give the global
outlook.

Quality management

Quality management is multifaceted and goes beyond the customer service definition to
incorporate other aspects including employee satisfaction and engagement. A single random
encounter with a hotel staff can make the difference between a happy customer, a pleased
customer or a client who goes online and writes a negative review of his hotel experience. By

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focusing on employee satisfaction as well as customer service, a hotel may increase the
likelihood that all of its staff will also provide excellent customer service.(Thompson, 2020).

In order to maintain the quality and service standards, the selection and recruitments of well
experienced and qualified staff is highly essential. Further, there needs to be an in house
“Training Manager”. Time to time external Training Managers workshops and training
programs are also essential.

Flexibility

As well as being a critical success factor for the hotel industry, flexibility is a key factor in
quality management. A hotel's guests may have entirely different standards, and managers need
to be given the authority to make decisions to satisfy them where possible.A manager frustrated
by an inflexible collection of policies may not be able to solve a customer issue and in the
future gain the trust of that customer and the positive word of mouth. A manager with the
authority to make exceptions is in a much better position to turn a situation around and earn a
good reputation for customer service and high quality when appropriate. (Thompson, 2020).

The role of the General Manager is the key to grant the liberty to his immediate assistants to
perform well. Health & Wellness Director - Well-being, Finance Manager, Human Resources
Manager, Training Manager, Director of Sales ,Front Office Manager, Executive Housekeeper,
Spa & Fitness Manager - Ayurveda Doctor, Food & Beverage Manager,Executive Chef &Chief
Engineer are the key team of the hotel. They should have guided with SOPs and P&Ps to
perform well.

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5 Discussion, Conclusions & recommendations

Zero (0) Based Budget (ZBB) approach (Gaille, 2020) used for the calculations of chapter 05.
There are no historic data. The concept of “Well-Being & Dark Tourism” including authentic
traditional medicines of Sri Lanka is a unique concept. The competitors’ finance
numbers are also not available. The author used his industry knowledge and
experience and hypothesis to assume the numbers.

Notes to the Chapter 05

➢ Breakdown of initial startup capital , disburse , financing requirement – 5.2.1 Start-up

Capital Breakdown
➢ Breakdown of fixed cost & Variable Cost –5.2.6 Breakeven Analysis
➢ Working capital requirement – 5.2.2. Working Capital Requirements(due to practical
reasons, calculated annual figures. Further cash budget 5.2.3 Quarterly Based cash
budgetsshows surplus figures.
➢ Breakdown of capital & Interest payment –Appendix 2: Interest on Bank Loan
Calculation
➢ Breakdown of Sales & Cash flow – 5.2 Financial Projections for the proposed
business Development option&5.2.3 Quarterly Based cash budgets
➢ Cost of possible failure–Based on the assumptions of the author, calculations of 5.2.6
Breakeven Analysisafter the first 06 months hotel will start making positive NOP.
Therefore the success rate of this project is high.
➢ Detailed profit or Loss Accounts of 03 years & Mater Budget of 03 years 5.2 Financial
Projections for the proposed business Development option
➢ Statement of financial position (Balance Sheet) – 5.2.5 Budgeted statement of
financial position(position at end of 03rd year – 2024).
➢ Sensitivity Analysis – 5.2.7 Sensitivity Analysis
➢ Ratio Analysis – 5.2.8 Ratio Analysis
➢ Non-financial indicator analysis –(NAGY, et al., 2008-
2020)cleanliness,comfort,location,service, staff &value for money are the non-
financial indicators of a hotel. It can be measured once the hotel start operation.
➢ Cost Management - 5.2.9 Cost Management

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5.1 Strategic Business Unit Plan (SBU Plan)

Hotel consists of Seven (07) departments. Such as Rooms, F&B, Spa, MOD, A&G, S&M and
POMEC. Staff recruitment will be done from Headhunters (Renard International Hospitality
Search Consultant, 2020), (GLOBAL HOSPITALITY, 2020), Recruitment Websites (Caterer
Global, 2020), (Top Jobs, 2020). Face to Face Interviews, Interviews via Skype will be used.
Questioner, Evaluation Forms, References will be used for the selection and recruitment
process.

There are specialize softwarefor hotel operation which used by Hotel Departments.

Front Office - (Oracle, 2020), Opera PMS (Oracle), Micros Simphony POS (Oracle)

Finance & Accounting - (SunAccounts, 2020)- Sun Accounting System,(Oracle,

2020)Material Control for inventory control.

Human Resources - (Hospitality Technology, 2017)Fusion for HR.

In 5.2.1 Start-up Capital Breakdownexplained the detailed list of the infrastructure of the
entire Hotel.

Action Plan of a hotel -(Bordoy , 2018)Improve the profitability of the company's hotels by
enhancing the knowledge of the destination and the competitive set. Knowledge of the
company's own production. Definition of short-term goals and analysis of the organization's
current situation and equipping it with.

Assumptions

1. Action Plans & Strategies–compare with the SBU Budget prepared vs. Actual Figures
and analyze the reasons for under / over variations.
2. Resource & Deployment–Computers, Mobile Phones, Office Furniture, Vehicles, and
other Fixed Assets infrastructure are not mentioned in details under each SBU budgets.
But the whole fixed assets requirements of the hotel included in Fixed Assets Details
in 5.2.1 Start-up Capital Breakdown
3. Monitoring & Review – Once the Monthly Management Accounts prepared the
Finance department distribute the SBU Profit or Loss accounts with the SBU Budget.
The under / over various must be reviewed, analyzed and justified by the each and every
Head of Department concerned.
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 4. Casual labor / staff will be recruited case by case basis based on the occupancy %.
5. Ayurveda Doctors from Sri Lanka and India, Nutritionist, Naturopath,
CAMPractitioner, Physiotherapist , Fitness Manager , Instructors – (Classes , Gym ,
Yoga ) , Health Coaches are on consultant basis and their fees mentioned in Extra wages
of the SBU Budgets.
6. Depreciation, Property Insurance are treated as below the Gross Operating Profit (GOP)
expenses are included in the Profit or Loss Accounts.
7. Staff Insurance include in host benefits.
8. Salaries & Wages are included E.P.F &F.T.F.
9. In order to align with the page , some numbers are presented in “Front 8”&
“Landscape”

Table 5 - 1Basis of Revenue Recognition

Revenue - USD 2022 2023 2024

Room Rates (Gross) 325 350 375
Food Revenue - Per Guest 30 32 32
None Alcoholic Beverage Revenue - (Food
Covers) 8 8 8
F&B Other Revenue - Per Guest (Food Covers) 3 3 3
Spa - (Number of Guest Nights) 67 67 61
MOD - (Number of Guest Night) 2 2 2

Number of Rooms Sold 12,734 13,412 14,753

Average Occupancy 70% 73% 81%

Other than the room rates, rest of the rates keep remain same for the year 2023 & 2024. The
strategy is to increase the average occupancy up to 81% by 2024. In Hotel Accounting, some
expenses are directly related to Occupancy, Number of Paying Rooms, Number of Guests and
Food Covers. Therefore the same principles applied to the calculations. Further all expenses
and income are in line with benchmarks and industry average of hotel industry norms.

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5.1.1 Rooms Department – (Front Office, Reservation & Housekeeping)

❖ Objectives & Time Scales

Objectives
Front Office - Creating a database for the guests.Dealing with guest accounts.Coordinating
service for guests. Trying selling a service. Ensuring satisfaction for guests.In-house
correspondence is done by PBX.(tutorialspoint, 2020)
Reservation -(Setupmyhotel.com, 2012-2030)the booking department’s role is not restricted
to making a reservation. It maintains hotel occupancy records which help in planning strategies
for sales and marketing etc. The booking department plays an important role for the guest as
well as the hotel.
House Keeping - (Leaf Group Ltd, 2020)routine cleaning and everyday maintenance, such as
dusting, polishing and vacuuming furniture. Housekeepers are emptying trash cans, removing
garbage and replacing supplies like towels and toilet paper.(Setupmyhotel.com, 2012)

Time Scales – Monthly & Quarterly

❖ Action Plans & Strategies

The daily monitoring sheets. Check Sheets, log sheets, cleaning charts.

❖ Resourcing & Deployment

Table 5 - 2Staff Budget Rooms Department

Head Salaries
Grading
Reservations Count USD
Yield & Revenue Manager DH 1 500
Reservations Manager Manager 1 300
Total Reservations 2 800

Head Salaries
Grading
Front Office Count USD
Front Office Manager Department Head 1 1,500
Assistant Front Office
Manager Assistant Department Head 1 300
Head Butler Manager 1 200
Butler 1 Host 1 200
Butler 2 Host 1 200
Butler 3 Host 1 200
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 Butler 4 Host 1 200
Butler 5 Host 1 200
Total Front Office 8 3,000

Head Salaries
Grading
Telephone / Transport Count USD
Front Office Supervisor Supervisor 1 800
Telephone Operator 1 Host 1 200
Total Telephone /
Transport 2 1,000

Head Salaries
Grading
Housekeeping Count USD
Executive Housekeeper Department Head 1 1,000
Assistant Executive
Housekeeper Assistant Department Head 1 500
Housekeeping Supervisor 1 Supervisor 1 200
Villa Host 1 Host 1 200
Villa Host 2 Host 1 200
Villa Host 3 Host 1 200
Villa Host 4 Host 1 200
Villa Host 5 Host 1 200
Total Housekeeping 8 2,700

Other resources –Appendix 1: Fixed Assets, Depreciation & Insurance Premium

❖ Key Performance Indicators (KPIs)

➢ Occupancy Rate
➢ Average Daily Rate (ADR)
➢ Average Room Rate (ARR)
➢ Revenue per Available Room (RevPAR)
➢ Net Revenue per Available Room (NRevPAR)
➢ Revenue per Occupied Room (RevPOR)
➢ Gross operating profit per available room
➢ Cost per Occupied Room (CPOR)
P a g e 80 | 192
 ➢ Online Rating
➢ Customer Satisfaction
➢ Loyalty Programs
➢ Website conversion rate
➢ Segmentation
➢ TrevPar
➢ Average Length of Stay (ALOS)

(Attala , 2019), (Guiding Metrics, n.d.)(eZee, 2020)

❖ Monitoring & Review

Review of Monthly Management Accounts with actual results

P a g e 81 | 192
Table 5 - 3Room Department Budget (Pro Forma) - USD
2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022
Description January February March April May June July August September October November December Total
Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
Statistics
Rooms available per day 50 50 50 50 50 50 50 50 50 50 50 50 50
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms sold (Paying Rooms) 800 840 882 926 972 1,021 1,072 1,126 1,182 1,241 1,303 1,368 12,734
Rooms Complimentary 24 25 26 28 29 31 32 34 35 37 39 41 382
Rooms occupied (Gross) 824 865 908 954 1,002 1,052 1,104 1,159 1,217 1,278 1,342 1,409 13,116
Occupancy % (Include comp) (Gross) 53% 60% 59% 64% 65% 70% 71% 75% 81% 82% 89% 91% 72%
Occupancy % (Exclude comp) (Net) 52% 58% 57% 62% 63% 68% 69% 73% 79% 80% 87% 88% 70%
Average room rate (Include complimentary) 316 316 316 316 316 316 316 316 316 316 316 316 316
Average room rate (Exclude complimentary) 325 325 325 325 325 325 325 325 325 325 325 325 325
Average Revenue - (Exclude complimentary) 708 709 709 709 709 709 709 709 709 709 709 709 709
Number of guest nights 1,680 1,764 1,852 1,945 2,042 2,144 2,251 2,364 2,482 2,606 2,737 2,873 26,741
REVPAR 168 188 185 201 204 221 225 236 256 260 282 287 226
Food covers 2,472 2,596 2,725 2,862 3,005 3,155 3,313 3,478 3,652 3,835 4,027 4,228 39,347
Number of guest nights (include 1,704 1,789 1,879 1,973 2,071 2,175 2,284 2,398 2,518 2,643 2,776 2,914 27,123
Complimentary)
Revenue 260,000 273,000 286,650 300,983 316,032 331,833 348,425 365,846 384,138 403,345 423,513 444,688 4,138,453
Service Charge 26,000 27,300 28,665 30,098 31,603 33,183 34,842 36,585 38,414 40,335 42,351 44,469 413,845
V.A.T. 22,880 24,024 25,225 26,486 27,811 29,201 30,661 32,194 33,804 35,494 37,269 39,133 364,184
Total Revenue 308,880 324,324 340,540 357,567 375,446 394,218 413,929 434,625 456,356 479,174 503,133 528,290 4,916,482

Payroll & Related Expenses

Salary & Wages 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 90,000
Extra Wages 750 750 750 750 750 750 750 750 750 750 750 750 9,000
Service Charge 26,000 27,300 28,665 30,098 31,603 33,183 34,842 36,585 38,414 40,335 42,351 44,469 413,845
Host Benefits 1,250 1,251 1,252 1,253 1,254 1,255 1,256 1,257 1,258 1,259 1,260 1,261 15,066

P a g e 82 | 192
Total Payroll & Related Expenses 35,500 36,801 38,167 39,601 41,107 42,688 44,348 46,092 47,922 49,844 51,861 53,980 527,911

Other Operating Expenses

Printing, Stationery and Equipment 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
Laundry 300 300 300 300 300 300 300 300 300 300 300 300 3,600
Uniform 50 50 50 50 50 50 50 50 50 50 50 50 600
Postage and Courier 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Training Expenses - Allocated 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 13,200
Training Expenses - Direct 250 250 250 250 250 250 250 250 250 250 250 250 3,000
Communication Charges 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Travelling-Abroad Expenses 750 750 750 750 750 750 750 750 750 750 750 750 9,000
Travelling-Local Expenses 250 250 250 250 250 250 250 250 250 250 250 250 3,000
Guest Supplies 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 90,000
Guest Complimentary 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 30,000
Guest Transportation 950 950 950 950 950 950 950 950 950 950 950 950 11,400
Cleaning Supplies 4,750 4,750 4,750 4,750 4,750 4,750 4,750 4,750 4,750 4,750 4,750 4,750 57,000
Prov For Replacement Linen 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Prov For Replace Crockery & Glass 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Other Operating Supplies 375 375 375 375 375 375 375 375 375 375 375 375 4,500
Airport Expenses 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
Cable TV Expenses 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
Travel Agent Commissions 26,000 27,300 28,665 30,098 31,603 33,183 34,842 36,585 38,414 40,335 42,351 44,469 413,845
Staff Commissions and Incentives 2,600 2,730 2,867 3,010 3,160 3,318 3,484 3,658 3,841 4,033 4,235 4,447 41,385
Reservation Expenses 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Misc. Expenses 250 250 250 250 250 250 250 250 250 250 250 250 3,000
Total Other Expenses 55,275 56,705 58,207 59,783 61,438 63,177 65,002 66,918 68,930 71,043 73,261 75,591 775,330
V.A.T. 22,880 24,024 25,225 26,486 27,811 29,201 30,661 32,194 33,804 35,494 37,269 39,133 364,184
Total Departmental Expenses 113,655 117,530 121,599 125,871 130,356 135,066 140,012 145,204 150,656 156,381 162,392 168,703 1,667,425
Departmental Profit 195,225 206,794 218,942 231,696 245,089 259,152 273,917 289,421 305,700 322,793 340,741 359,587 3,249,057
GOP % 63% 64% 64% 65% 65% 66% 66% 67% 67% 67% 68% 68% 66%

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5.1.2 Food & Beverage (F&B) Department – (All Outlets, All Bars, All Restaurants &
F&B Production – Main Kitchen)

❖ Objectives & Time Scales

Greet customers and answer questions relating to menu products and specials, Take customers’
orders for food or drink, Relay orders from customers to other kitchen employees, Prepare
groceries and drinks such as sandwiches, salads and coffee. (TRUITY, 2020).

Time Scales –Daily, weekly and monthly

❖ Action Plans & Strategies

Follow up with the SBU Budget approved by the Management.

❖ Resourcing & Deployment

Table 5 - 4Staff Budget – Food & Beverage Department

Head Salaries
Grading
F&B Services Count USD
Food & Beverage Manager Hotel Executive 1 1,500
Assistant Food & Beverage
Manager Assistant Department Head 1 400
Outlet Manager 1 - Main
Rest Manager 1 350
Outlet Manager 2 - Japanese
Rest Manager 1 350
IVD Supervisor Supervisor 1 350
Head Waiter Main
Restaurant 1 Host 1 350
Head Waiter Main
Restaurant 2 Host 1 350
Head Waiter Italian 1 Host 1 300
Head Waiter Italian 2 Host 1 300
Total F&B Service 9 4,250

Head Salaries
Grading
Kitchen Count USD
Executive Chef Hotel Executive 1 2,000
Ayurveda Doctor Hotel Executive 1 600
Chef de Cuisine Ayurveda Manager 1 450

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 Junior Sous Chef - Host
Restaurant Manager 1 450
Pastry Chef Manager 1 450
Head Butcher Supervisor 1 450
Senior CDP Baker 1 Supervisor 1 450
Commis Baker 1 Host 1 450
Steward 1 Host 1 450
Total Kitchen 9 5,750

Other resources – Appendix 1: Fixed Assets, Depreciation & Insurance Premium

❖ Key Performance Indicators (KPIs)

➢ Food Cost %
➢ Beverage Cost %
➢ Food Covers
➢ Beverage Covers
➢ Waiters per Guests
➢ Revenue contribution % per outlets / restaurants
➢ Revenue contribution % per Bar
➢ LP Gas Consumption per food Cover
➢ Electricity Consumption per food cover

(Attala , 2019), (Guiding Metrics, n.d.)(eZee, 2020)

❖ Monitoring & Review

Review of Monthly Management Accounts (Budget & Actuals)

P a g e 85 | 192
Table 5 - 5Food & Beverage Department Budget (Pro Forma) - USD

2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022
Description January February March April May June July August September October November December Total
Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
Statistics
Rooms available per day 50 50 50 50 50 50 50 50 50 50 50 50 50
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms sold (Paying Rooms) 800 840 882 926 972 1,021 1,072 1,126 1,182 1,241 1,303 1,368 12,734
Rooms Complimentary 24 25 26 28 29 31 32 34 35 37 39 41 382
Rooms occupied (Gross) 824 865 908 954 1,002 1,052 1,104 1,159 1,217 1,278 1,342 1,409 13,116
Occupancy % (Include comp) (Gross) 53% 60% 59% 64% 65% 70% 71% 75% 81% 82% 89% 91% 72%
Occupancy % (Exclude comp) (Net) 52% 58% 57% 62% 63% 68% 69% 73% 79% 80% 87% 88% 70%
Average room rate (Include complimentary) 316 316 316 316 316 316 316 316 316 316 316 316 316
Average room rate (Exclude complimentary) 325 325 325 325 325 325 325 325 325 325 325 325 325
Average Revenue - (Exclude complimentary) 708 709 709 709 709 709 709 709 709 709 709 709 709
Number of guest nights 1,680 1,764 1,852 1,945 2,042 2,144 2,251 2,364 2,482 2,606 2,737 2,873 26,741
REVPAR 168 188 185 201 204 221 225 236 256 260 282 287 226
Food covers 2,472 2,596 2,725 2,862 3,005 3,155 3,313 3,478 3,652 3,835 4,027 4,228 39,347
Number of guest nights (include Complimentary) 1,704 1,789 1,879 1,973 2,071 2,175 2,284 2,398 2,518 2,643 2,776 2,914 27,123
Revenue
Food Revenue 74,160 77,868 81,761 85,849 90,142 94,649 99,381 104,351 109,568 115,047 120,799 126,839 1,180,414
None Alcoholic Beverage Revenue 18,540 19,467 20,440 21,462 22,535 23,662 24,845 26,088 27,392 28,762 30,200 31,710 295,104

Other Revenue 6,180 6,489 6,813 7,154 7,512 7,887 8,282 8,696 9,131 9,587 10,067 10,570 98,368

Service Charge 9,888 9,734 10,220 10,731 11,268 11,831 12,423 13,044 13,696 14,381 15,100 15,855 148,170
156,202
V.A.T. 8,701 10,382 10,902 11,447 12,019 12,620 13,251 13,913 14,609 15,340 16,107 16,912
Total F&B Revenue 117,469 123,940 130,137 136,644 143,476 150,650 158,182 166,091 174,396 183,116 192,271 201,885 1,878,257
Cost Of Sales
Food Cost 22,248 23,360 24,528 25,755 27,043 28,395 29,814 31,305 32,870 34,514 36,240 38,052 354,124

P a g e 86 | 192
None Alcoholic Beverage Cost 3,523 3,699 3,884 4,078 4,282 4,496 4,721 4,957 5,204 5,465 5,738 6,025 56,070
Other Cost 742 779 818 858 901 946 994 1,044 1,096 1,150 1,208 1,268 11,804
Total F& B Cost 26,512 27,838 29,230 30,691 32,226 33,837 35,529 37,305 39,171 41,129 43,186 45,345 421,998

Gross Profit / Loss 72,368 75,986 79,785 83,775 87,964 92,362 96,980 101,829 106,920 112,266 117,880 123,773 1,151,887
GOP % 73% 73% 73% 73% 73% 73% 73% 73% 73% 73% 73% 73% 73%

Payroll & Related Expenses

Salary & Wages 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 120,000
Extra Wages 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Service Charge 9,888 9,734 10,220 10,731 11,268 11,831 12,423 13,044 13,696 14,381 15,100 15,855 148,170
Host Benefits 1,750 1,751 1,752 1,753 1,754 1,755 1,756 1,757 1,758 1,759 1,760 1,761 21,066
Total Payroll & Related Expense 22,638 22,485 22,972 23,484 24,022 24,586 25,179 25,801 26,454 27,140 27,860 28,616 301,236

Other Operating Expenses

Printing, Stationery and Equipment 750 750 750 750 750 750 750 750 750 750 750 750 9,000
Laundry 300 300 300 300 300 300 300 300 300 300 300 300 3,600
Uniform 50 50 50 50 50 50 50 50 50 50 50 50 600
Postage and Courier 100 100 100 100 100 100 100 100 100 100 100 100 1,200
Training Expenses 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 13,200
Communication Charges 250 250 250 250 250 250 250 250 250 250 250 250 3,000
Travelling-Abroad Expenses 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Travelling-Local Expenses 750 750 750 750 750 750 750 750 750 750 750 750 9,000
Guest Supplies 250 250 250 250 250 250 250 250 250 250 250 250 3,000
Paper Supplies 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Bar Supplies 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Guest Complimentary 950 950 950 950 950 950 950 950 950 950 950 950 11,400
Cleaning Supplies 750 750 750 750 750 750 750 750 750 750 750 750 9,000
Prov For Replacement Linen 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 13,200
Prov For Replace Crockery & Glass 375 375 375 375 375 375 375 375 375 375 375 375 4,500
Prov For Replacement Cutlery 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000

P a g e 87 | 192
Prov For Replacement Kitchenware 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
Operating Supplies 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
Music Entertainment 225 225 225 225 225 225 225 225 225 225 225 225 2,700
Commission & Incentive 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Spoilage Damage Pilferage 125 125 125 125 125 125 125 125 125 125 125 125 1,500
Kitchen Fuel 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
LP Gas Consumption 1,854 1,947 2,044 2,146 2,254 2,366 2,485 2,609 2,739 2,876 3,020 3,171 29,510
Food Safety contract 750 750 750 750 750 750 750 750 750 750 750 750 9,000
Misc. Expenses & Music Concierge 50 50 50 50 50 50 50 50 50 50 50 50 600
Total Other Operating Expenses 17,779 17,872 17,969 18,071 18,179 18,291 18,410 18,534 18,664 18,801 18,945 19,096 220,610

V.A.T. 8,701 10,382 10,902 11,447 12,019 12,620 13,251 13,913 14,609 15,340 16,107 16,912 156,202

Total Expenses 75,631 78,576 81,072 83,693 86,445 89,334 92,368 95,553 98,898 102,410 106,097 109,969 1,100,046

Dept. Profit / Loss 41,839 45,363 49,064 52,951 57,031 61,315 65,814 70,538 75,498 80,706 86,175 91,917 778,211

GOP % 36% 37% 38% 39% 40% 41% 42% 42% 43% 44% 45% 46% 41%

P a g e 88 | 192
5.1.3 Spa & Ayurveda Center – (Spa Treatment &Retail, Hair Salon Treatment
&Retail,Yoga, Ayurveda Center,Sports, Fitness and visiting practitioners)

❖ Objectives & Time Scales

The primary aim is to provide individual services and treatments for clients seeking Spa&
Ayurveda, with an emphasis on wellness. The food&Medicines given must be in accordance
with a balanced lifestyle. Spa costs are typically higher than a 'non-Spa' Hotel or the regular
day spa.(Xhotels, 2020).

Time Scales – Daily & Monthly

❖ Action Plans & Strategies

Follow up with the SBU Budget approved by the Management

❖ Resourcing & Deployment

Table 5 - 6Staff Budget - Spa & Ayurveda Center

Head Salaries
Grading
Spa & Fitness Count USD
Spa & Fitness Manager -
Ayurveda Doctor Department Head 1 1,200

Food Nutritionist Manager 1 700

Spa Therapist 1 Host 1 300

Spa Therapist 2 Host 1 300

Therapist Specialist 1 Host 1 300

Beautician Supervisor Supervisor 1 300

Fitness Instructor 1 Supervisor 1 300

Spa Cleaner 1 Host 1 300

Yoga Instructor 1 Supervisor 1 300

Total Spa 9 4,000

P a g e 89 | 192
Other resources – Appendix 1: Fixed Assets, Depreciation & Insurance Premium

❖ Key Performance Indicators (KPIs)

➢ Spa capture ratio
➢ Spa Service Ratio
➢ Average spend of spa
➢ Treatment cost for guest
➢ Most demanding spa treatment / package

(Attala , 2019), (Guiding Metrics, n.d.)(eZee, 2020)

❖ Monitoring & Review

Review of Monthly Management Accounts (Budget & Actuals)

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Table 5 - 7 Spa & Ayurveda Department Budget (Pro Forma) - USD

2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022
Description January February March April May June July August September October November December Total
Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
Statistics
Rooms available per day 50 50 50 50 50 50 50 50 50 50 50 50 50
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms sold (Paying Rooms) 800 840 882 926 972 1,021 1,072 1,126 1,182 1,241 1,303 1,368 12,734
Rooms Complimentary 24 25 26 28 29 31 32 34 35 37 39 41 382
Rooms occupied (Gross) 824 865 908 954 1,002 1,052 1,104 1,159 1,217 1,278 1,342 1,409 13,116
Occupancy % (Include comp) (Gross) 53% 60% 59% 64% 65% 70% 71% 75% 81% 82% 89% 91% 72%
Occupancy % (Exclude comp) (Net) 52% 58% 57% 62% 63% 68% 69% 73% 79% 80% 87% 88% 70%
Average room rate (Include complimentary) 316 316 316 316 316 316 316 316 316 316 316 316 316
Average room rate (Exclude complimentary) 325 325 325 325 325 325 325 325 325 325 325 325 325
Average Revenue - (Exclude complimentary) 708 709 709 709 709 709 709 709 709 709 709 709 709
Number of guest nights 1,680 1,764 1,852 1,945 2,042 2,144 2,251 2,364 2,482 2,606 2,737 2,873 26,741
REVPAR 168 188 185 201 204 221 225 236 256 260 282 287 226
Food covers 2,472 2,596 2,725 2,862 3,005 3,155 3,313 3,478 3,652 3,835 4,027 4,228 39,347
Number of guest nights (include Complimentary) 1,704 1,789 1,879 1,973 2,071 2,175 2,284 2,398 2,518 2,643 2,776 2,914 27,123

Spa Revenue
Spa Treatment Revenue 42,600 44,730 46,967 49,315 51,781 54,370 57,088 59,942 62,940 66,087 69,391 72,860 678,070
Spa Retail Revenue 21,300 22,365 23,483 24,657 25,890 27,185 28,544 29,971 31,470 33,043 34,695 36,430 339,035
Hair Salon Treatment 1,704 1,789 1,879 1,973 2,071 2,175 2,284 2,398 2,518 2,643 2,776 2,914 27,123
Hair Salon & Fitness Retail 852 895 939 986 1,036 1,087 1,142 1,199 1,259 1,322 1,388 1,457 13,561
Yoga 8,520 8,946 9,393 9,863 10,356 10,874 11,418 11,988 12,588 13,217 13,878 14,572 135,614
Ayurveda Center 28,968 30,416 31,937 33,534 35,211 36,971 38,820 40,761 42,799 44,939 47,186 49,545 461,087
Tennis Revenue 341 358 376 395 414 435 457 480 504 529 555 583 5,425
Fitness and Visiting Practitioner 10,224 10,735 11,272 11,836 12,427 13,049 13,701 14,386 15,106 15,861 16,654 17,487 162,737
Service Charge 11,451 12,023 12,625 13,256 13,919 14,615 15,345 16,113 16,918 17,764 18,652 19,585 182,265
V.A.T. 10,077 10,581 11,110 11,665 12,248 12,861 13,504 14,179 14,888 15,632 16,414 17,235 160,393
Total Spa Revenue 136,036 142,838 149,980 157,479 165,353 173,621 182,302 191,417 200,988 211,037 221,589 232,669 2,165,309
Spa COS

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 2,982 3,131 3,288 3,452 3,625 3,806 3,996 4,196 4,406 4,626 4,857 5,100 47,465
Spa Treatment
7,455 7,828 8,219 8,630 9,062 9,515 9,990 10,490 11,014 11,565 12,143 12,751 118,662
Spa Retail
596 626 658 690 725 761 799 839 881 925 971 1,020 9,493
Hair Salon Treatment
409 429 451 473 497 522 548 575 604 634 666 699 6,509
Hair Salon & Fitness Retail
Yoga 682 716 751 789 828 870 913 959 1,007 1,057 1,110 1,166 10,849
Ayurveda Center 5,794 6,083 6,387 6,707 7,042 7,394 7,764 8,152 8,560 8,988 9,437 9,909 92,217
Tennis 26 27 28 30 31 33 34 36 38 40 42 44 407
Fitness and Visiting Practitioner 2,556 2,684 2,818 2,959 3,107 3,262 3,425 3,597 3,776 3,965 4,163 4,372 40,684
Spa F&B Cost 426 447 470 493 518 544 571 599 629 661 694 729 6,781
Total Spa COS 20,925 21,971 23,070 24,223 25,435 26,706 28,042 29,444 30,916 32,462 34,085 35,789 333,068

Gross Profit/Loss 115,111 120,867 126,910 133,256 139,919 146,914 154,260 161,973 170,072 178,575 187,504 196,879 1,832,242
85% 85% 85% 85% 85% 85% 85% 85% 85% 85% 85% 85% 85%

Payroll & Related Expenses

Salary and Wages 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 48,000
Extra Wages 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
Service Charge 11,451 12,023 12,625 13,256 13,919 14,615 15,345 16,113 16,918 17,764 18,652 19,585 182,265
Host Benefits 750 751 752 753 754 755 756 757 758 759 760 761 9,066
Total Payroll and Related Exp 17,451 18,024 18,627 19,259 19,923 20,620 21,351 22,120 22,926 23,773 24,662 25,596 254,331

Other Operating Expenses

Printing, Stationery and Equipment 250 250 250 250 250 250 250 250 250 250 250 250 3,000
Laundry 150 150 150 150 150 150 150 150 150 150 150 150 1,800
Uniform 75 75 75 75 75 75 75 75 75 75 75 75 900
Postage and Courier 25 25 25 25 25 25 25 25 25 25 25 25 300
Training Expenses 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Communication Charges 90 90 90 90 90 90 90 90 90 90 90 90 1,080
Travelling-Abroad Expenses 1,600 1,600 1,600 1,600 1,600 1,600 1,600 1,600 1,600 1,600 1,600 1,600 19,200
Travelling-Local Expenses 375 375 375 375 375 375 375 375 375 375 375 375 4,500
Guest Supplies 150 150 150 150 150 150 150 150 150 150 150 150 1,800
Guest Complimentary (Welcome amenities) 800 800 800 800 800 800 800 800 800 800 800 800 9,600
Cleaning Supplies 175 175 175 175 175 175 175 175 175 175 175 175 2,100
Visiting Practitioner Commission 1,010 1,010 1,010 1,010 1,010 1,010 1,010 1,010 1,010 1,010 1,010 1,010 12,120

P a g e 92 | 192
Management Fee - (5% of Spa Revenue) 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 13,200
Other Operating Supplies 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Commissions and Incentives 1,718 1,804 1,894 1,988 2,088 2,192 2,302 2,417 2,538 2,665 2,798 2,938 27,340
Miscellaneous 100 101 102 103 104 105 106 107 108 109 110 111 1,266
Total Other Operating Expenses 9,118 9,205 9,296 9,391 9,492 9,597 9,708 9,824 9,946 10,074 10,208 10,349 116,206

V.A.T. 10,077 10,581 11,110 11,665 12,248 12,861 13,504 14,179 14,888 15,632 16,414 17,235 160,393

Total Spa Expenses 57,570 59,781 62,102 64,539 67,097 69,784 72,605 75,566 78,676 81,941 85,369 88,968 863,998

Spa Department Profit 78,466 83,057 87,878 92,940 98,256 103,837 109,697 115,851 122,312 129,096 136,220 143,700 1,301,312
58% 58% 59% 59% 59% 60% 60% 61% 61% 61% 61% 62% 60%

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5.1.4 Minor Operating Department (MOD) – (Telephone, Laundry, Boutique, Kids Club)

❖ Objectives & Time Scales

The MOD provide the hotel with additional revenues. Give the hotel a good face. Well and
pretty guest services. Â Good guest experience.(Aswathi, 2019)

Time Scale – Daily, Weekly, Monthly.

❖ Action Plans & Strategies

Follow up with the SBU Budget approved by the Management

❖ Resourcing & Deployment

Table 5 - 8Staff Budget–Minor Operating Department

Head
Grading Salaries USD
Laundry Count
Laundry Supervisor Supervisor 1 500
Laundry Attendant 1 Host 1 100
Laundry Attendant 2 Host 1 100
Tailor 1 Host 1 100
Florist Host 1 100
Total Laundry 5 900

Head
Grading Salaries USD
Shop Count
Retail Manager Manager 1 300
Retail Attendant 1 Host 1 100
Total Shop 2 400

Head
Grading Salaries USD
Recreation Count
Kids Club Supervisor Supervisor 1 200
Total Recreation 1 200

Other resources – Appendix 1: Fixed Assets, Depreciation & Insurance Premium

P a g e 94 | 192
 ❖ Key Performance Indicators (KPIs)

➢ Cost per guest

➢ Capturing ratio
➢ Contribution per department ratio

(Attala , 2019), (Guiding Metrics, n.d.)(eZee, 2020)

❖ Monitoring & Review

Review of Monthly Management Accounts (Budget & Actuals)

P a g e 95 | 192
Table 5 - 9 Minor Operating Department Budget (Pro Forma) USD

2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022
Description January February March April May June July August September October November December Total
Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
Statistics
Rooms available per day 50 50 50 50 50 50 50 50 50 50 50 50 50
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms sold (Paying Rooms) 800 840 882 926 972 1,021 1,072 1,126 1,182 1,241 1,303 1,368 12,734
Rooms Complimentary 24 25 26 28 29 31 32 34 35 37 39 41 382
Rooms occupied (Gross) 824 865 908 954 1,002 1,052 1,104 1,159 1,217 1,278 1,342 1,409 13,116
Occupancy % (Include comp) 53% 60% 59% 64% 65% 70% 71% 75% 81% 82% 89% 91% 72%
(Gross)
Occupancy % (Exclude comp) 52% 58% 57% 62% 63% 68% 69% 73% 79% 80% 87% 88% 70%
(Net)
Average room rate (Include 316 316 316 316 316 316 316 316 316 316 316 316 316
complimentary)
Average room rate (Exclude 325 325 325 325 325 325 325 325 325 325 325 325 325
complimentary)
Average Revenue - (Exclude 708 709 709 709 709 709 709 709 709 709 709 709 709
complimentary)
Number of guest nights 1,680 1,764 1,852 1,945 2,042 2,144 2,251 2,364 2,482 2,606 2,737 2,873 26,741
REVPAR 168 188 185 201 204 221 225 236 256 260 282 287 226
Food covers 2,472 2,596 2,725 2,862 3,005 3,155 3,313 3,478 3,652 3,835 4,027 4,228 39,347
Number of guest nights (include 1,704 1,789 1,879 1,973 2,071 2,175 2,284 2,398 2,518 2,643 2,776 2,914 27,123
Complimentary)
MOD Revenue
Telephone Revenue 50 50 50 50 50 50 50 50 50 50 50 50 600
Laundry Revenue 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Other Income 150 150 150 150 150 150 150 150 150 150 150 150 1,800
Boutique Revenue 3,408 3,578 3,757 3,945 4,142 4,350 4,567 4,795 5,035 5,287 5,551 5,829 54,246
Kids Club Revenue 100 100 100 100 100 100 100 100 100 100 100 100 1,200
V.A.T. 313 326 341 356 371 388 405 424 443 463 484 506 4,820

P a g e 96 | 192
Total MOD Revenue 4,221 4,405 4,598 4,801 5,014 5,238 5,472 5,719 5,978 6,250 6,535 6,835 65,065
Cost Of Sales
Telephone 5 5 5 5 5 5 5 5 5 5 5 5 60
Laundry 40 40 40 40 40 40 40 40 40 40 40 40 480
Other 18 18 18 18 18 18 18 18 18 18 18 18 216
Boutique 2,215 2,326 2,442 2,564 2,693 2,827 2,969 3,117 3,273 3,437 3,608 3,789 35,260
Kids Club 20 20 20 20 20 20 20 20 20 20 20 20 240
Total MOD Cost 2,298 2,409 2,525 2,647 2,776 2,910 3,052 3,200 3,356 3,520 3,691 3,872 36,256

Gross Profit / Loss 1,922 1,996 2,073 2,153 2,238 2,327 2,421 2,519 2,622 2,730 2,844 2,963 28,810

Payroll & Related Expenses

Salary & Wages 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
Extra Wages 400 400 400 400 400 400 400 400 400 400 400 400 4,800
Host Benefits 100 100 100 100 100 100 100 100 100 100 100 100 1,200
Total Payroll & Related Expenses 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 24,000

MOD Department Expenses

Printing & Stationery 50 50 50 50 50 50 50 50 50 50 50 50 600
Laundry 75 75 75 75 75 75 75 75 75 75 75 75 900
Uniform 50 50 50 50 50 50 50 50 50 50 50 50 600
Postage and Courier 25 25 25 25 25 25 25 25 25 25 25 25 300
Training Expenses 50 50 50 50 50 50 50 50 50 50 50 50 600
Communication Charge 10 10 10 10 10 10 10 10 10 10 10 10 120
Travelling-Local Expense 25 25 25 25 25 25 25 25 25 25 25 25 300
Guest Supplies 25 25 25 25 25 25 25 25 25 25 25 25 300
Equipment Rental 25 25 25 25 25 25 25 25 25 25 25 25 300
Other Operating Supplies 30 30 30 30 30 30 30 30 30 30 30 30 360
Commission & Incentives 22 22 22 22 22 22 22 22 22 22 22 22 264
Laundry Supplies 17 17 17 17 17 17 17 17 17 17 17 17 204
Laundry Chemicals 1 1 1 1 1 1 1 1 1 1 1 1 12

P a g e 97 | 192
Miscellaneous 2 2 2 2 2 2 2 2 2 2 2 2 24
Total Other Operating Expenses 407 407 407 407 407 407 407 407 407 407 407 407 4,884

V.A.T. 313 326 341 356 371 388 405 424 443 463 484 506 4,820

Total Expenses 5,018 5,142 5,273 5,410 5,554 5,705 5,864 6,031 6,206 6,389 6,582 6,785 69,959

Dept. Profit / Loss (797) (738) (675) (609) (540) (468) (392) (312) (228) (140) (47) 50 (4,894)

MOD is a Loss Leader

No Service Charge for the
Revenue

P a g e 98 | 192
5.1.5 Administration & General Department (A&G) – (Executive Office, Finance, Human
Resource, Training, Security & Information Technology (IT))

❖ Objectives & Time Scales

Executive Office - The General Manager is responsible for all aspects of hotel operations, to
day-to-day management of staff and guests. He / she should be the brand and your hotel's
ambassador. Responsible for managing the management team of hotels (HOD's) and overall
hotel goals in order to deliver an excellent guest experience.(Setupmyhotel, 2012-2030)

Finance–Preparing of financial accounting, cost accounting, tax accounting, auditing and

managerial accounting.(TRG International, 2018)

Human Resource- HR is responsible for the Hotel’s staff. Hiring, fire, training and keeping
employees and employee relationships are their job.(Barrett, 2020)

Security - Hotel security provides protection for hotel guests, staff and property. Typically,
hotel security works directly on the hotel property, patrolling the grounds and monitoring
security cameras or filling out paperwork in an office. When the situation demands it, hotel
security may also collaborate with local police. (Wisdom IT , 2020)

Information Technology - helped reduce costs, improve operational efficiency and improve
customer experience and services. This helps to lower labor costs but also helps avoid problems
with customer service. (Entre Technology Services, 2018)

Time Scale – Daily & Monthly

❖ Action Plans & Strategies

Follow up with the SBU Budget approved by the Management

❖ Resourcing & Deployment

Table 5 - 10Staff Budget – Admin and General

Headcount
Position Grading @ 50 Salaries USD
Cottages
General Manager -Well-Being Hotel Executive 1 5,000
Health & Wellness Director -
Well-being Hotel Executive 1 3,000
P a g e 99 | 192
Executive Assistant Manager 1 1000
Total GM Office 3 9,000

Head
Grading Salaries USD
Sustainability Count
Sustainability Coordinator
(CSR) Supervisor 1 700
Total Sustainability 1 700

Head
Grading Salaries USD
Finance Count
Finance Manager Department Head 1 1,000
Assistant Financial Manager Assistant Department Head 1 800
Accounts Receivable Supervisor 1 500
General Cashier / Accounts
Payable Host 1 500
Cost Controller Manager 1 500
Night Auditor 1 Supervisor 1 500
Income Auditor Supervisor 1 500
Chief Storekeeper Manager 1 500
Store Assistant 1 Host 1 500
Receiving Officer Supervisor 1 500
Total Finance 10 5,800

Head
Grading Salaries USD
IT Count
IT Coordinator 1 Supervisor 1 1,500
IT Coordinator 2 Supervisor 1 1,000
Total IT 2 2,500

Head
Grading Salaries USD
Purchasing Count
Purchasing Manager Department Head 1 2,000
Assistant Purchasing Manager Manager 1 1,500
Total Purchasing 2 3,500

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 Human Resources & Head
Grading Salaries USD
Development Count
Human Resources Manager Assistant Department Head 1 2,000
Doctor Manager 1 1,000
HR Officer Supervisor 1 500
Total HRD 3 3,500

Head
Grading Salaries USD
Training Count
Training Manager Manager 1 2,000
Total Training 1 2,000

Head
Grading Salaries USD
Security Count
Security Manager Assistant Department Head 1 1,000
Security Officer 1 Host 1 400
Security Officer 2 Host 1 400
Security Officer 3 Host 1 400
Security Officer 4 Host 1 400
Security Officer 5 Host 1 400
Total Security 6 3,000

Other resources – Appendix 1: Fixed Assets, Depreciation & Insurance Premium

❖ Key Performance Indicators (KPIs)

➢ Labor Costs as % of Sales

➢ Staff turnover ratio
➢ Employee Performance
➢ Financial Performance
➢ Gross Operating Profit
➢ Average Daily Attendance (ADA)
➢ Revenue Generation Index (RGI) or RevPar yield index

P a g e 101 | 192
 ➢ MCPB (marketing cost per booking)
➢ Sentiment score on TripAdvisor
➢ DRR (direct revenue ratio)
➢ Earnings before Interest, Taxes, Depreciation and Amortization

(Attala , 2019), (Guiding Metrics, n.d.)(eZee, 2020)

❖ Monitoring & Review

Review of Monthly Management Accounts (Budged & Actuals)

P a g e 102 | 192
Table 5 - 11 Admin & General Budget (Pro Forma) USD

2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022
Description January February March April May June July August September October November December Total
Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
Statistics
Rooms available per day 50 50 50 50 50 50 50 50 50 50 50 50 50
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms sold (Paying Rooms) 800 840 882 926 972 1,021 1,072 1,126 1,182 1,241 1,303 1,368 12,734
Rooms Complimentary 24 25 26 28 29 31 32 34 35 37 39 41 382
Rooms occupied (Gross) 824 865 908 954 1,002 1,052 1,104 1,159 1,217 1,278 1,342 1,409 13,116
Occupancy % (Include comp) (Gross) 53% 60% 59% 64% 65% 70% 71% 75% 81% 82% 89% 91% 72%
Occupancy % (Exclude comp) (Net) 52% 58% 57% 62% 63% 68% 69% 73% 79% 80% 87% 88% 70%
Average room rate (Include complimentary) 316 316 316 316 316 316 316 316 316 316 316 316 316
Average room rate (Exclude complimentary) 325 325 325 325 325 325 325 325 325 325 325 325 325
Average Revenue - (Exclude 708 709 709 709 709 709 709 709 709 709 709 709 709
complimentary)
Number of guest nights 1,680 1,764 1,852 1,945 2,042 2,144 2,251 2,364 2,482 2,606 2,737 2,873 26,741
REVPAR 168 188 185 201 204 221 225 236 256 260 282 287 226
Food covers 2,472 2,596 2,725 2,862 3,005 3,155 3,313 3,478 3,652 3,835 4,027 4,228 39,347
Number of guest nights (include 1,704 1,789 1,879 1,973 2,071 2,175 2,284 2,398 2,518 2,643 2,776 2,914 27,123
Complimentary)
Payroll & Related Expenses
Salary and Wages 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 360,000
Extra Wages 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 90,000
Host Benefits 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 72,000
Total Payroll and Related Expenses 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 522,000

Other Operating Expenses

Printing, Stationery & Equipment 750 750 750 750 750 750 750 750 750 750 750 750 9,000
Laundry 400 400 400 400 400 400 400 400 400 400 400 400 4,800
Uniforms 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Postage & Courier 100 100 100 100 100 100 100 100 100 100 100 100 1,200
Training Expenses 750 750 750 750 750 750 750 750 750 750 750 750 9,000
Communication Charge 500 500 500 500 500 500 500 500 500 500 500 500 6,000

P a g e 103 | 192
Broad Band 300 300 300 300 300 300 300 300 300 300 300 300 3,600
Travelling-Abroad Expenses 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
Travelling-Local Expenses 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Bank Charges 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Audit Fees 175 175 175 175 175 175 175 175 175 175 175 175 2,100
Professional Fees 250 250 250 250 250 250 250 250 250 250 250 250 3,000
License & Taxes 100 100 100 100 100 100 100 100 100 100 100 100 1,200
C.S.R. Fund 260 260 260 260 260 260 260 260 260 260 260 260 3,120
Credit Card Commission 8,329 8,754 9,191 9,650 10,133 10,639 11,170 11,728 12,314 12,930 13,576 14,254 132,669
Software Maintenance 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 30,000
Hardware Maintenance 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 4,000 48,000
Meeting Cost 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Contract Security 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
Business Entertainment 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Recruitment & Relocation Costs 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 30,000
Visa and Work Permit 750 750 750 750 750 750 750 750 750 750 750 750 9,000
Host Survey Expenses 250 250 250 250 250 250 250 250 250 250 250 250 3,000
Dues and Subscriptions 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Head Office Expenses 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Office Equipment Rental 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
Cash Overages and Shortages 250 250 250 250 250 250 250 250 250 250 250 250 3,000
Loss and Damage 75 75 75 75 75 75 75 75 75 75 75 75 900
Transportation 250 250 250 250 250 250 250 250 250 250 250 250 3,000
Staff Insurance 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
Staff Food Cost 1,860 1,860 1,860 1,860 1,860 1,860 1,860 1,860 1,860 1,860 1,860 1,860 22,320
Miscellaneous 100 101 102 103 104 105 106 107 108 109 110 111 1,266
Total Other Operating Expenses 34,099 34,525 34,963 35,423 35,907 36,414 36,946 37,505 38,092 38,709 39,356 40,035 441,975

Total Admin & General Expenses 77,599 78,025 78,463 78,923 79,407 79,914 80,446 81,005 81,592 82,209 82,856 83,535 963,975

P a g e 104 | 192
5.1.6 Sales & Marketing Department

❖ Objectives & Time Scales

The department of sales and marketing is responsible for deciding where the company should
sell, and what its prices should be. This includes choosing the company's intermediaries, such
as wholesalers, distributors or retailers, if any.(Hearst Newspapers, 2020).

Time Scale – Monthly, Quarterly and Annually.

❖ Action Plans & Strategies

Increase Revenue (Occupancy & Room Revenue) – Incentive / Performance commission

to the staff.

❖ Resourcing & Deployment

Table 5 - 12Staff Budget – Sales & Marketing

Head Salaries
Grading
Marketing Count USD
Director of Sales Department Head 1 5,000
Marketing &
Communications Manager Assistant Department Head 1 3,000
Marketing Executive 1 Supervisor 1 1,000
Marketing Executive 2 -
Social Media Supervisor 1 1,000
Russian Sales Supervisor Supervisor 1 1,000
Web & Digital Marketing Supervisor 1 1,000
Total Marketing 6 12,000

Other resources – Appendix 1: Fixed Assets, Depreciation & Insurance Premium

P a g e 105 | 192
 ❖ Key Performance Indicators (KPIs)

➢ Marketing ROI
➢ Market Penetration Index (MPI)
➢ Marketing Costs as % of Sales
➢ Performance evaluation of the Sales & Marketing Staff

(Attala , 2019), (Guiding Metrics, n.d.)(eZee, 2020)

❖ Monitoring & Review

Review of Monthly Management Accounts (Budget and Actuals)

P a g e 106 | 192
Table 5 - 13 Sales & Marketing Budget (Pro Forma) USD

Description 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022
January February March April May June July August September October November December Total
Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
Statistics
Rooms available per day 50 50 50 50 50 50 50 50 50 50 50 50 50
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms sold (Paying Rooms) 800 840 882 926 972 1,021 1,072 1,126 1,182 1,241 1,303 1,368 12,734
Rooms Complimentary 24 25 26 28 29 31 32 34 35 37 39 41 382
Rooms occupied (Gross) 824 865 908 954 1,002 1,052 1,104 1,159 1,217 1,278 1,342 1,409 13,116
Occupancy % (Include comp) (Gross) 53% 60% 59% 64% 65% 70% 71% 75% 81% 82% 89% 91% 72%
Occupancy % (Exclude comp) (Net) 52% 58% 57% 62% 63% 68% 69% 73% 79% 80% 87% 88% 70%
Average room rate (Include complimentary) 316 316 316 316 316 316 316 316 316 316 316 316 316
Average room rate (Exclude complimentary) 325 325 325 325 325 325 325 325 325 325 325 325 325
Average Revenue - (Exclude complimentary) 708 709 709 709 709 709 709 709 709 709 709 709 709
Number of guest nights 1,680 1,764 1,852 1,945 2,042 2,144 2,251 2,364 2,482 2,606 2,737 2,873 26,741
REVPAR 168 188 185 201 204 221 225 236 256 260 282 287 226
Food covers 2,472 2,596 2,725 2,862 3,005 3,155 3,313 3,478 3,652 3,835 4,027 4,228 39,347
Number of guest nights (include Complimentary) 1,704 1,789 1,879 1,973 2,071 2,175 2,284 2,398 2,518 2,643 2,776 2,914 27,123
Payroll & Related Expenses
Salary and Wages 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 138,000
Extra Wages 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 11,500
Host Benefits 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 17,250
Total Payroll and Related Expenses 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 166,750

Printing, Stationery & Equipment 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Laundry 400 400 400 400 400 400 400 400 400 400 400 400 4,800
Uniforms 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Postage & Courier 300 300 300 300 300 300 300 300 300 300 300 300 3,600
Training Expenses 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Seminars & Meetings 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Loyalty Program 500 500 500 500 500 500 500 500 500 500 500 500 6,000

P a g e 107 | 192
Communication Charge 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Travelling-Abroad Expenses 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 30,000
Travelling-Local Expenses 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Trade Shows & Travel Fairs 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Road show 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Sales Calls 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Membership & Subscriptions 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
Events & Entertainment 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Promotions & Offers 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Retainer Fees - Sales Representative Offices 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Retainer Fees - PR Offices 500 500 500 500 500 500 500 500 500 500 500 500 6,000
PR Activities 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 60,000
Brochures & Collateral Material 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Photography & Videography 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Events & Joint Marketing 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Incentives and Override Commission 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Website Maintenance and others 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Internet & Database Marketing 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
TO Brochure Contribution - Cash & Barter 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Joint Marketing Activities - Tour Operator Cash &
Barter 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Advertisement 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Press Trips & Fam Trips (on costs) 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Preferred Hotels (Digital Marketing) 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Gift & Giveaways 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Affiliation and other fees 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Total Other Operating Expenses 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 298,800

S & M Departmental Expense 39,400 39,400 39,400 39,400 39,400 39,400 39,400 39,400 39,400 39,400 39,400 39,400 465,550

P a g e 108 | 192
5.1.7 Property Operations, Maintenance & Energy Consultants (POMEC) –
(Engineering, Repair & Maintenance, Garden and Utilities)

❖ Objectives & Time Scales

Services such as electricity, steam, hot water, air conditioning and refrigeration, maintenance
of engineering and services of various other equipment are of great importance.(WordPress,
2020).

Time Scales – Daily, Weekly and Monthly.

❖ Action Plans & Strategies

Follow up with the SBU Budget approved by the Management

❖ Resourcing & Deployment

Table 5 - 14Staff Budget - Property Operations, Maintenance & Energy Consultants

Head Salaries
Grading
Engineering Count USD
Chief Engineer Department Head 1 1,900
Engineering Supervisor
1(Plant & Machine) Supervisor 1 800
Plant & Machine Supervisor Supervisor 1 800
General Mechanic Host 1 500
Power House Tech 1 Host 1 500
Laundry & Kitchen
Technician 1 Host 1 500
General Mechanic 1 Host 1 500
Ac Mechanic 1 Host 1 500
Electrician 1 Host 1 500
STP Operator 2 Host 1 500
Plumber 1 Host 1 500
Pool Cleaner 1 Host 1 500
Pool Cleaner 2 Host 1 500
Painter Host 1 500
Handyman/Welder 1 Host 1 500
Mason Host 1 500
Total Engineering 16 10,000
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Other resources – Appendix 1: Fixed Assets, Depreciation & Insurance Premium

❖ Key Performance Indicators (KPIs)

➢ Energy Management
➢ Water Consumption per occupied room
➢ Water Consumption per available room
➢ Electricity Cost per occupied room
➢ Electricity Cost per available room
➢ Electricity Units consumed per occupied room
➢ Electricity Units consumed per available room
➢ Generator - Diesel consumption per occupied room
➢ Generator - Diesel consumption per available room

(Attala , 2019), (Guiding Metrics, n.d.)(eZee, 2020)

❖ Monitoring & Review

Review of Monthly Management Accounts (Budget & Actuals)

P a g e 110 | 192
Table 5 - 15Property Operations, Maintenance & Energy Consultants Budget (Pro Forma) USD

2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022
Description January February March April May June July August September October November December Total
Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
Statistics
Rooms available per day 50 50 50 50 50 50 50 50 50 50 50 50 50
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms sold (Paying Rooms) 800 840 882 926 972 1,021 1,072 1,126 1,182 1,241 1,303 1,368 12,734
Rooms Complimentary 24 25 26 28 29 31 32 34 35 37 39 41 382
Rooms occupied (Gross) 824 865 908 954 1,002 1,052 1,104 1,159 1,217 1,278 1,342 1,409 13,116
Occupancy % (Include comp) (Gross) 53% 60% 59% 64% 65% 70% 71% 75% 81% 82% 89% 91% 72%
Occupancy % (Exclude comp) (Net) 52% 58% 57% 62% 63% 68% 69% 73% 79% 80% 87% 88% 70%
Average room rate (Include 316 316 316 316 316 316 316 316 316 316 316 316 316
complimentary)
Average room rate (Exclude 325 325 325 325 325 325 325 325 325 325 325 325 325
complimentary)
Average Revenue - (Exclude 708 709 709 709 709 709 709 709 709 709 709 709 709
complimentary)
Number of guest nights 1,680 1,764 1,852 1,945 2,042 2,144 2,251 2,364 2,482 2,606 2,737 2,873 26,741
REVPAR 168 188 185 201 204 221 225 236 256 260 282 287 226
Food covers 2,472 2,596 2,725 2,862 3,005 3,155 3,313 3,478 3,652 3,835 4,027 4,228 39,347
Number of guest nights (include 1,704 1,789 1,879 1,973 2,071 2,175 2,284 2,398 2,518 2,643 2,776 2,914 27,123
Complimentary)
Payroll & Related Expenses
Salary and Wages 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 120,000
Extra Wages 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 21,000
Host Benefits 900 900 900 900 900 900 900 900 900 900 900 900 10,800
Total Payroll and Related Expenses 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 151,800
Other Operating Expenses
Printing, Stationery & Equipment 250 250 250 250 250 250 250 250 250 250 250 250 3,000
Laundry 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Uniforms 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Postage & Courier 200 200 200 200 200 200 200 200 200 200 200 200 2,400

P a g e 111 | 192
Training Expenses 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 24,000
Training Expenses - Direct 2,250 2,250 2,250 2,250 2,250 2,250 2,250 2,250 2,250 2,250 2,250 2,250 27,000
Communication Charge 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 51,000
Travelling-Abroad Expenses 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 36,000
Travelling-Local Expenses 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 24,000
R&M Building 2,250 2,250 2,250 2,250 2,250 2,250 2,250 2,250 2,250 2,250 2,250 2,250 27,000
R&M Air-condition and Refrigeration 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 51,000
R&M Electrical(and Mechanical) 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 21,000
R&M Generator Maintenance 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
R&M Kitchen Equipment 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 16,800
R&M Laundry Equipment 750 750 750 750 750 750 750 750 750 750 750 750 9,000
R&M Plumbing and Heating 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 21,000
R&M Sound System 750 750 750 750 750 750 750 750 750 750 750 750 9,000
R&M Vehicles 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
R&M Office Equipment 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
R&M Furniture & Fixtures 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 21,000
R&M Swimming Pool (All) 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
R&M Painting and Decoration 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
R&M Fire Safety and Security Equipment 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
R&M Ground & Landscaping 2,750 2,750 2,750 2,750 2,750 2,750 2,750 2,750 2,750 2,750 2,750 2,750 33,000
R&M Lagoon Maintenance 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 21,000
R&M Water Treatment 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 15,000
R&M Curtains and Drapes 750 750 750 750 750 750 750 750 750 750 750 750 9,000
R&M General 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 36,000
Light Bulbs 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 36,000
Removal Of Waste Material & Water 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 18,000
Sewage 3,250 3,250 3,250 3,250 3,250 3,250 3,250 3,250 3,250 3,250 3,250 3,250 39,000
Maintenance Service Contract 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 21,000
Pest Control 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Garden Supplies 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 38,400
Miscellaneous 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Total Other Operating Expenses 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 736,200
Utility Cost (Electricity , Water & Diesel) 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 480,000
POMEC Departmental Expenses 114,000 114,000 114,000 114,000 114,000 114,000 114,000 114,000 114,000 114,000 114,000 114,000 1,368,000

P a g e 112 | 192
5.2 Financial Projections for the proposed business Development option
Year 2022
2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022 2022
Description January February March April May June July August September October November December Total
Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
Statistics
Rooms available per day 50 50 50 50 50 50 50 50 50 50 50 50 50
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms sold (Paying Rooms) 800 840 882 926 972 1,021 1,072 1,126 1,182 1,241 1,303 1,368 12,734
Rooms Complimentary 24 25 26 28 29 31 32 34 35 37 39 41 382
Rooms occupied (Gross) 824 865 908 954 1,002 1,052 1,104 1,159 1,217 1,278 1,342 1,409 13,116
Occupancy % (Include comp) (Gross) 53% 60% 59% 64% 65% 70% 71% 75% 81% 82% 89% 91% 72%
Occupancy % (Exclude comp) (Net) 52% 58% 57% 62% 63% 68% 69% 73% 79% 80% 87% 88% 70%
Average room rate (Include complimentary) 316 316 316 316 316 316 316 316 316 316 316 316 316
Average room rate (Exclude complimentary) 325 325 325 325 325 325 325 325 325 325 325 325 325
Average Revenue - (Exclude complimentary) 708 709 709 709 709 709 709 709 709 709 709 709 709
Number of guest nights 1,680 1,764 1,852 1,945 2,042 2,144 2,251 2,364 2,482 2,606 2,737 2,873 26,741
REVPAR 168 188 185 201 204 221 225 236 256 260 282 287 226
Food covers 2,472 2,596 2,725 2,862 3,005 3,155 3,313 3,478 3,652 3,835 4,027 4,228 39,347
Number of guest nights (include Complimentary) 1,704 1,789 1,879 1,973 2,071 2,175 2,284 2,398 2,518 2,643 2,776 2,914 27,123

Revenue
Room 260,000 273,000 286,650 300,983 316,032 331,833 348,425 365,846 384,138 403,345 423,513 444,688 4,138,453
Food 74,160 77,868 81,761 85,849 90,142 94,649 99,381 104,351 109,568 115,047 120,799 126,839 1,180,414
Beverage (None Alcoholic) 18,540 19,467 20,440 21,462 22,535 23,662 24,845 26,088 27,392 28,762 30,200 31,710 295,104
F&B Other 6,180 6,489 6,813 7,154 7,512 7,887 8,282 8,696 9,131 9,587 10,067 10,570 98,368
Spa / Yoga / Ayurveda Center 114,509 120,234 126,246 132,558 139,186 146,145 153,453 161,125 169,182 177,641 186,523 195,849 1,822,651
MOD Revenue 3,908 4,078 4,257 4,445 4,642 4,850 5,067 5,295 5,535 5,787 6,051 6,329 60,246
Room Revenue service Charge 26,000 27,300 28,665 30,098 31,603 33,183 34,842 36,585 38,414 40,335 42,351 44,469 413,845
F&B Revenue service charge 9,888 9,734 10,220 10,731 11,268 11,831 12,423 13,044 13,696 14,381 15,100 15,855 148,170
Spa Revenue service charge 11,451 12,023 12,625 13,256 13,919 14,615 15,345 16,113 16,918 17,764 18,652 19,585 182,265
Total Revenue 524,636 550,194 577,678 606,537 636,839 668,656 702,064 737,142 773,974 812,648 853,255 895,893 8,339,515
Expenses
Front Office , Reservation & House Keeping
P a g e 113 | 192
Payroll & Related 35,500 36,801 38,167 39,601 41,107 42,688 44,348 46,092 47,922 49,844 51,861 53,980 527,911
Other Expenses 55,275 56,705 58,207 59,783 61,438 63,177 65,002 66,918 68,930 71,043 73,261 75,591 775,330

Food & Beverage

Food cost 22,248 23,360 24,528 25,755 27,043 28,395 29,814 31,305 32,870 34,514 36,240 38,052 354,124
Beverage Cost (None Alcoholic) 3,523 3,699 3,884 4,078 4,282 4,496 4,721 4,957 5,204 5,465 5,738 6,025 56,070
Other Cost 742 779 818 858 901 946 994 1,044 1,096 1,150 1,208 1,268 11,804
Payroll & related 22,638 22,485 22,972 23,484 24,022 24,586 25,179 25,801 26,454 27,140 27,860 28,616 301,236
Other expenses 17,779 17,872 17,969 18,071 18,179 18,291 18,410 18,534 18,664 18,801 18,945 19,096 220,610

SPA , Yoga & Ayurveda Center

Spa Cost of Sales 20,925 21,971 23,070 24,223 25,435 26,706 28,042 29,444 30,916 32,462 34,085 35,789 333,068
Payroll & related 17,451 18,024 18,627 19,259 19,923 20,620 21,351 22,120 22,926 23,773 24,662 25,596 254,331
Other Expenses 9,118 9,205 9,296 9,391 9,492 9,597 9,708 9,824 9,946 10,074 10,208 10,349 116,206

Minor Operating Departments

Cost Of Sales 2,298 2,409 2,525 2,647 2,776 2,910 3,052 3,200 3,356 3,520 3,691 3,872 36,256
Total Payroll & Related Expenses 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 24,000
Total Other Operating Expenses 407 407 407 407 407 407 407 407 407 407 407 407 4,884

Executive Office , Finance , HR , Training ,

Security & IT
Payroll & related expenses 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 522,000
Operating expenses 34,099 34,525 34,963 35,423 35,907 36,414 36,946 37,505 38,092 38,709 39,356 40,035 441,975

Sales & Marketing

Payroll & related expenses 7,250 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 166,750
Operating expenses 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 298,800

POMEC
Payroll & related expenses 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 151,800
Operating expenses 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 736,200
Utility Cost 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 480,000

Total Expenses 433,652 447,141 454,332 461,882 469,810 478,133 486,873 496,049 505,684 515,800 526,422 537,575 5,813,355

P a g e 114 | 192
Gross Operating Profit (GOP) 90,984 103,052 123,346 144,655 167,029 190,523 215,191 241,093 268,290 296,847 326,833 358,318 2,526,160
G.O.P. % 17% 19% 21% 24% 26% 28% 31% 33% 35% 37% 38% 40% 30%

Non-Operating Income / Expenses

Insurance 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 134,824
Exchange gain / loss 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Total Non-Operating Income / Expenses 12,235 12,235 12,235 12,235 12,235 12,235 12,235 12,235 12,235 12,235 12,235 12,235 146,824

EBITDA 78,748 90,817 111,111 132,419 154,794 178,287 202,955 228,857 256,055 284,612 314,598 346,083 2,379,336

Interest on Bank Loans 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 615,000
Amortization of Pre-Opening Cost 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 299,400
Depreciation 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 1,225,150
TOTAL INT., DEPR. AND AMORT. 178,296 178,296 178,296 178,296 178,296 178,296 178,296 178,296 178,296 178,296 178,296 178,296 2,139,550
Income Before Income Tax (99,548) (87,479) (67,185) (45,876) (23,502) (9) 24,660 50,562 77,759 106,316 136,302 167,787 239,786
Business Profit Tax - 14% 33,570
Net profit/(Losses) (99,548) (87,479) (67,185) (45,876) (23,502) (9) 24,660 50,562 77,759 106,316 136,302 167,787 206,216
N.O.P. % -19% -16% -12% -8% -4% 0% 4% 7% 10% 13% 16% 19% 2%

Year 2023 350 350 350 350 350 350 350 350 350 350 350 350
Description 2023 2023 2023 2023 2023 2023 2023 2023 2023 2023 2023 2023 2023

P a g e 115 | 192
 January February March April May June July August September October November December Total
Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
Statistics
Rooms available per day 50 50 50 50 50 50 50 50 50 50 50 50 50
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms sold (Paying Rooms) 1,000 1,020 1,040 1,061 1,082 1,104 1,126 1,149 1,172 1,195 1,219 1,243 13,412
Rooms Complimentary 24 26 29 32 35 39 43 47 51 57 62 68 513
Rooms occupied (Gross) 1,024 1,046 1,069 1,093 1,118 1,143 1,169 1,195 1,223 1,252 1,281 1,312 13,925
Occupancy % (Include comp) (Gross) 66% 72% 69% 73% 72% 76% 75% 77% 82% 81% 85% 85% 76%
Occupancy % (Exclude comp) (Net) 65% 70% 67% 71% 70% 74% 73% 74% 78% 77% 81% 80% 73%
Average room rate (Include complimentary) 342 341 340 340 339 338 337 336 335 334 333 332 337
Average room rate (Exclude complimentary) 350 350 350 350 350 350 350 350 350 350 350 350 350
Average Revenue - (Exclude complimentary) 636 643 650 658 666 675 683 692 701 710 720 729 682
Number of guest nights 2,100 2,142 2,185 2,229 2,273 2,319 2,365 2,412 2,460 2,510 2,560 2,611 28,165
REVPAR 226 246 235 248 244 258 254 259 273 270 284 281 257
Food covers 3,072 3,139 3,208 3,279 3,353 3,428 3,506 3,586 3,669 3,755 3,844 3,936 41,776
Number of guest nights (include Complimentary) 2,124 2,168 2,214 2,260 2,308 2,357 2,407 2,459 2,512 2,566 2,622 2,680 28,679

Revenue
Room 350,000 357,000 364,140 371,423 378,851 386,428 394,157 402,040 410,081 418,282 426,648 435,181 4,694,231
Food 77,868 81,761 85,849 90,142 94,649 99,381 104,351 109,568 115,047 120,799 126,839 133,181 1,239,435
Beverage (None Alcoholic) 19,467 20,440 21,462 22,535 23,662 24,845 26,088 27,392 28,762 30,200 31,710 33,295 309,859
F&B Other 6,489 6,813 7,154 7,512 7,887 8,282 8,696 9,131 9,587 10,067 10,570 11,098 103,286
Spa / Yoga / Ayurveda Center 120,234 126,246 132,558 139,186 146,145 153,453 161,125 169,182 177,641 186,523 195,849 205,641 1,913,784
MOD Revenue 4,103 4,282 4,470 4,667 4,875 5,092 5,320 5,560 5,812 6,076 6,354 6,645 63,258
Room Revenue service Charge 35,000 35,700 36,414 37,142 37,885 38,643 39,416 40,204 41,008 41,828 42,665 43,518 469,423
F&B Revenue service charge 10,382 10,902 11,447 12,019 12,620 13,251 13,913 14,609 15,340 16,107 16,912 17,757 165,258
Spa Revenue service charge 12,023 12,625 13,256 13,919 14,615 15,345 16,113 16,918 17,764 18,652 19,585 20,564 191,378
Total Revenue 635,567 655,770 676,751 698,545 721,190 744,721 769,178 794,604 821,040 848,534 877,131 906,882 9,149,912
Expenses
Front Office , Reservation & House Keeping
Payroll & Related 35,855 37,169 38,549 39,997 41,518 43,115 44,792 46,553 48,401 50,342 52,380 54,520 533,190
Other Expenses 55,828 57,272 58,789 60,381 62,053 63,808 65,652 67,587 69,620 71,753 73,994 76,347 783,083

Food & Beverage

P a g e 116 | 192
Food cost 22,470 23,594 24,774 26,012 27,313 28,679 30,113 31,618 33,199 34,859 36,602 38,432 357,665
Beverage Cost (None Alcoholic) 3,558 3,736 3,923 4,119 4,325 4,541 4,768 5,006 5,257 5,519 5,795 6,085 56,630
Other Cost 749 786 826 867 910 956 1,004 1,054 1,107 1,162 1,220 1,281 11,922
Payroll & related 22,864 22,709 23,202 23,719 24,262 24,832 25,430 26,059 26,719 27,411 28,138 28,902 304,248
Other expenses 17,957 18,050 18,149 18,252 18,360 18,474 18,594 18,719 18,851 18,989 19,134 19,287 222,816
-
SPA , Yoga & Ayurveda Center -
Spa Cost of Sales 21,134 22,191 23,301 24,466 25,689 26,973 28,322 29,738 31,225 32,786 34,426 36,147 336,398
Payroll & related 17,625 18,205 18,813 19,451 20,122 20,826 21,565 22,341 23,155 24,011 24,909 25,852 256,874
Other Expenses 9,209 9,297 9,389 9,485 9,587 9,693 9,805 9,922 10,045 10,174 10,310 10,452 117,368
-
Minor Operating Departments -
Cost Of Sales 2,321 2,433 2,551 2,674 2,803 2,939 3,082 3,232 3,389 3,555 3,728 3,910 36,618
Total Payroll & Related Expenses 2,020 2,020 2,020 2,020 2,020 2,020 2,020 2,020 2,020 2,020 2,020 2,020 24,240
Total Other Operating Expenses 411 411 411 411 411 411 411 411 411 411 411 411 4,933
-
Executive Office , Finance , HR , Training ,
Security & IT -
Payroll & related expenses 43,935 43,935 43,935 43,935 43,935 43,935 43,935 43,935 43,935 43,935 43,935 43,935 527,220
Operating expenses 34,440 34,870 35,313 35,778 36,266 36,778 37,316 37,880 38,473 39,096 39,749 40,436 446,395
-
Sales & Marketing -
Payroll & related expenses 7,323 14,645 14,645 14,645 14,645 14,645 14,645 14,645 14,645 14,645 14,645 14,645 168,418
Operating expenses 18,675 18,675 18,675 18,675 18,675 18,675 18,675 18,675 18,675 18,675 18,675 18,675 224,100
-
POMEC -
Payroll & related expenses 12,777 12,777 12,777 12,777 12,777 12,777 12,777 12,777 12,777 12,777 12,777 12,777 153,318
Operating expenses 61,964 61,964 61,964 61,964 61,964 61,964 61,964 61,964 61,964 61,964 61,964 61,964 743,562
Utility Cost 40,400 40,400 40,400 40,400 40,400 40,400 40,400 40,400 40,400 40,400 40,400 40,400 484,800

Total Expenses 431,515 445,139 452,401 460,027 468,034 476,441 485,268 494,536 504,267 514,484 525,212 536,477 5,793,800
Gross Operating Profit (GOP) 204,053 210,631 224,349 238,518 253,156 268,280 283,911 300,068 316,774 334,049 351,918 370,405 3,356,112
G.O.P. % 32% 32% 33% 34% 35% 36% 37% 38% 39% 39% 40% 41% 37%

Non-Operating Income / Expenses

P a g e 117 | 192
Insurance 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 134,824
Exchange gain / loss 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 13,200
Total Non-Operating Income / Expenses 12,335 12,335 12,335 12,335 12,335 12,335 12,335 12,335 12,335 12,335 12,335 12,335 148,024

EBITDA 191,717 198,296 212,014 226,183 240,820 255,945 271,575 287,733 304,438 321,714 339,583 358,070 3,208,088

Interest on Bank Loans 46,125 46,125 46,125 46,125 46,125 46,125 46,125 46,125 46,125 46,125 46,125 46,125 553,500
Amortization of Pre-Opening Cost 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 299,400
Depreciation 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 1,225,150
TOTAL INT., DEPR. AND AMORT. 173,171 173,171 173,171 173,171 173,171 173,171 173,171 173,171 173,171 173,171 173,171 173,171 2,078,050
Income Before Income Tax 18,547 25,125 38,843 53,012 67,649 82,774 98,405 114,562 131,267 148,543 166,412 184,899 1,130,038
Business Profit Tax - 14% 2,597 3,517 5,438 7,422 9,471 11,588 13,777 16,039 18,377 20,796 23,298 25,886 158,205
Net profit/(Losses) 15,950 21,607 33,405 45,590 58,179 71,185 84,628 98,523 112,890 127,747 143,114 159,013 971,833
N.O.P. % 3% 3% 5% 7% 8% 10% 11% 12% 14% 15% 16% 18% 11%

Year 2024 375 375 375 375 375 375 375 375 375 375 375 375
2024 2024 2024 2024 2024 2024 2024 2024 2024 2024 2024 2024 2024
Description
January February March April May June July August September October November December Total

P a g e 118 | 192
 Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
Statistics
Rooms available per day 50 50 50 50 50 50 50 50 50 50 50 50 50
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms sold (Paying Rooms) 1,100 1,122 1,144 1,167 1,191 1,214 1,239 1,264 1,289 1,315 1,341 1,368 14,753
Rooms Complimentary 25 28 30 33 37 40 44 49 54 59 65 71 535
Rooms occupied (Gross) 1,125 1,150 1,175 1,201 1,227 1,255 1,283 1,312 1,342 1,374 1,406 1,439 15,288
Occupancy % (Include comp) (Gross) 73% 79% 76% 80% 79% 84% 83% 85% 89% 89% 94% 93% 84%
Occupancy % (Exclude comp) (Net) 71% 77% 74% 78% 77% 81% 80% 82% 86% 85% 89% 88% 81%
Average room rate (Include complimentary) 367 366 365 365 364 363 362 361 360 359 358 356 362
Average room rate (Exclude complimentary) 375 375 375 375 375 375 375 375 375 375 375 375 375
Average Revenue - (Exclude complimentary) 640 647 654 661 668 676 683 691 700 708 717 726 683
Number of guest nights 2,310 2,356 2,403 2,451 2,500 2,550 2,601 2,653 2,707 2,761 2,816 2,872 30,982
REVPAR 266 290 277 292 288 304 300 306 322 318 335 331 302
Food covers 3,375 3,449 3,524 3,602 3,682 3,764 3,849 3,937 4,027 4,121 4,217 4,317 45,864
Number of guest nights (include Complimentary) 2,335 2,384 2,434 2,485 2,537 2,591 2,646 2,702 2,760 2,820 2,881 2,944 31,517

Revenue
Room 412,500 420,750 429,165 437,748 446,503 455,433 464,542 473,833 483,309 492,976 502,835 512,892 5,532,487
Food 77,868 81,761 85,849 90,142 94,649 99,381 104,351 109,568 115,047 120,799 126,839 133,181 1,239,435
Beverage (None Alcoholic) 19,467 20,440 21,462 22,535 23,662 24,845 26,088 27,392 28,762 30,200 31,710 33,295 309,859
F&B Other 6,489 6,813 7,154 7,512 7,887 8,282 8,696 9,131 9,587 10,067 10,570 11,098 103,286
Spa / Yoga / Ayurveda Center 120,234 126,246 132,558 139,186 146,145 153,453 161,125 169,182 177,641 186,523 195,849 205,641 1,913,784
MOD Revenue 4,103 4,282 4,470 4,667 4,875 5,092 5,320 5,560 5,812 6,076 6,354 6,645 63,258
Room Revenue service Charge 41,250 42,075 42,917 43,775 44,650 45,543 46,454 47,383 48,331 49,298 50,284 51,289 553,249
F&B Revenue service charge 10,382 10,902 11,447 12,019 12,620 13,251 13,913 14,609 15,340 16,107 16,912 17,757 165,258
Spa Revenue service charge 12,023 12,625 13,256 13,919 14,615 15,345 16,113 16,918 17,764 18,652 19,585 20,564 191,378
Total Revenue 704,317 725,895 748,278 771,504 795,607 820,626 846,602 873,576 901,592 930,696 960,937 992,364 10,071,993
Expenses
Front Office , Reservation & House Keeping
Payroll & Related 36,210 37,537 38,930 40,393 41,929 43,542 45,235 47,013 48,880 50,840 52,898 55,059 538,470
Other Expenses 56,381 57,839 59,371 60,979 62,667 64,440 66,302 68,256 70,309 72,464 74,727 77,103 790,836

Food & Beverage

Food cost 22,693 23,828 25,019 26,270 27,583 28,963 30,411 31,931 33,528 35,204 36,964 38,813 361,207
P a g e 119 | 192
Beverage Cost (None Alcoholic) 3,593 3,773 3,961 4,159 4,367 4,586 4,815 5,056 5,309 5,574 5,853 6,145 57,191
Other Cost 756 794 834 876 919 965 1,014 1,064 1,118 1,173 1,232 1,294 12,040
Payroll & related 23,091 22,934 23,432 23,954 24,502 25,078 25,682 26,317 26,983 27,683 28,417 29,188 307,260
Other expenses 18,135 18,229 18,328 18,433 18,542 18,657 18,778 18,904 19,037 19,177 19,324 19,478 225,023

SPA , Yoga & Ayurveda Center

Spa Cost of Sales 21,344 22,411 23,531 24,708 25,943 27,240 28,602 30,033 31,534 33,111 34,767 36,505 339,729
Payroll & related 17,800 18,385 18,999 19,644 20,321 21,032 21,778 22,562 23,385 24,249 25,156 26,108 259,418
Other Expenses 9,300 9,389 9,482 9,579 9,682 9,789 9,902 10,020 10,145 10,275 10,412 10,556 118,530

Minor Operating Departments

Cost Of Sales 2,344 2,457 2,576 2,700 2,831 2,968 3,113 3,264 3,423 3,590 3,765 3,949 36,981
Total Payroll & Related Expenses 2,040 2,040 2,040 2,040 2,040 2,040 2,040 2,040 2,040 2,040 2,040 2,040 24,480
Total Other Operating Expenses 415 415 415 415 415 415 415 415 415 415 415 415 4,982

Executive Office , Finance , HR , Training ,

Security & IT
Payroll & related expenses 44,370 44,370 44,370 44,370 44,370 44,370 44,370 44,370 44,370 44,370 44,370 44,370 532,440
Operating expenses 34,781 35,215 35,663 36,132 36,625 37,142 37,685 38,256 38,854 39,483 40,143 40,836 450,815

Sales & Marketing

Payroll & related expenses 7,395 14,790 14,790 14,790 14,790 14,790 14,790 14,790 14,790 14,790 14,790 14,790 170,085
Operating expenses 19,049 19,049 19,049 19,049 19,049 19,049 19,049 19,049 19,049 19,049 19,049 19,049 228,582

POMEC
Payroll & related expenses 12,903 12,903 12,903 12,903 12,903 12,903 12,903 12,903 12,903 12,903 12,903 12,903 154,836
Operating expenses 62,577 62,577 62,577 62,577 62,577 62,577 62,577 62,577 62,577 62,577 62,577 62,577 750,924
Utility Cost 40,800 40,800 40,800 40,800 40,800 40,800 40,800 40,800 40,800 40,800 40,800 40,800 489,600

Total Expenses 435,976 449,735 457,069 464,771 472,857 481,347 490,261 499,621 509,448 519,767 530,601 541,977 5,853,428
Gross Operating Profit (GOP) 268,342 276,160 291,209 306,733 322,750 339,280 356,341 373,955 392,144 410,929 430,335 450,387 4,218,565
G.O.P. % 38% 38% 39% 40% 41% 41% 42% 43% 43% 44% 45% 45% 42%

Non-Operating Income / Expenses

Insurance 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 134,824

P a g e 120 | 192
Exchange gain / loss 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 14,400
Total Non-Operating Income / Expenses 12,435 12,435 12,435 12,435 12,435 12,435 12,435 12,435 12,435 12,435 12,435 12,435 149,224

EBITDA 255,906 263,725 278,774 294,298 310,315 326,844 343,906 361,520 379,709 398,494 417,900 437,951 4,069,341

Interest on Bank Loans 41,000 41,000 41,000 41,000 41,000 41,000 41,000 41,000 41,000 41,000 41,000 41,000 492,000
Amortization of Pre-Opening Cost 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 299,400
Depreciation 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 1,225,150
TOTAL INT., DEPR. AND AMORT. 168,046 168,046 168,046 168,046 168,046 168,046 168,046 168,046 168,046 168,046 168,046 168,046 2,016,550
Income Before Income Tax 87,861 95,679 110,728 126,252 142,269 158,798 175,860 193,474 211,663 230,448 249,854 269,905 2,052,791
Business Profit Tax - 14% 12,300 13,395 15,502 17,675 19,918 22,232 24,620 27,086 29,633 32,263 34,980 37,787 287,391
Net profit/(Losses) 75,560 82,284 95,226 108,577 122,351 136,567 151,240 166,388 182,030 198,185 214,875 232,119 1,765,401
N.O.P. % 11% 11% 13% 14% 15% 17% 18% 19% 20% 21% 22% 23% 18%

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5.2.1 Start-up Capital Breakdown

Total proposed project cost will be USD 20 Million and the breakdown shown below.

Initial Project Cost

USD
Freehold Land (Rs.3 Million per
Acres) 1,650,000

Buildings and Building Integral 12,500,000

Plant and Equipment 500,000

Sewerage Treatment Plant 55,000

Kitchen/Bar Equipment 375,000

Electrical Equipment 330,000

Solar Electrical System 80,000

Office Equipment 60,000

Sports Equipment 60,000

Furniture and Fittings 660,000

Swimming Pool Equipment 52,000

Generator 115,000

Motor Vehicles 100,000

Motor Vehicles - Electric 650,000

Water Treatment Plant 25,000

Linen, Cutlery and Crockery 275,000

Laundry and Hot Water Equipment 160,000

Telephone System 32,000

Elevators 55,000

SMA TV System 90,000

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Maintenance Tools 7,000

Music Instruments 10,000

Bar Furniture and Equipment 135,000

Computer Equipment & Systems 127,000

Computer Software 400,000

Company Secretarial Expenses 30,000

Initial Recruitment & Other Related 10,000

Architectural Fees 1,000,000

Professional Fees (Lawyers ,
Surveyors) 400,000

Miscellaneous 57,000

20,000,000

Initial Source of Finance USD

Owner's Capital 6,000,000

Issue of Shares through Public 10,000,000

Long Term Bank Loan 5,000,000

Permanent Bank Overdraft (P.O.D.) 1,000,000

22,000,000

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5.2.2. Working Capital Requirements

Working Capital Requirement –

USD
Current Current Working
Assets Liabilities Capital

2022 2,177,295 1,913,514 263,781

2023 1,885,602 1,743,809 141,794

2024 2,393,372 2,193,875 199,497

Total Working Capital for 03 years 605,072

Due to practical reasons, working capital calculated at the end of each year. Further5.2.3
Quarterly Based cash budgetsshows surplus number from the beginning.

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5.2.3 Quarterly Based cash budgets

USD 2022 2023 2024

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Receipts
Collection of Cash
Sales 535,412 619,498 717,070 830,022 637,660 701,284 772,683 852,945 705,831 773,627 849,453 934,415
Collection of Credit
Sales 812,571 1,376,717 1,593,543 1,844,547 1,653,546 1,584,943 1,745,228 1,925,309 1,766,843 1,750,434 1,920,848 2,111,678
Total In Flow 1,347,983 1,996,216 2,310,614 2,674,569 2,291,206 2,286,227 2,517,911 2,778,254 2,472,674 2,524,060 2,770,301 3,046,093
Out Flow
Payroll & Related 443,365 473,240 500,142 531,281 447,798 477,972 505,144 536,594 452,232 482,705 510,145 541,907
Purchases 156,779 181,452 210,014 243,087 158,346 183,266 212,114 245,509 159,914 185,081 214,214 241,939
Operational
Expenses 614,982 635,134 658,420 658,438 601,710 662,064 645,613 672,871 608,234 628,788 652,571 680,099
Utilities 120,000 120,000 120,000 120,000 121,200 121,200 121,200 121,200 122,400 122,400 122,400 122,400
Insurance 134,824 134,824 134,824
V.A.T. 132,201 152,963 177,054 204,944 157,447 173,156 190,786 210,604 174,279 191,019 209,742
Bank Loan - Capital 125,000 125,000 125,000 125,000 125,000 125,000 125,000 125,000 125,000 125,000 125,000 125,000
Bank Loan - Interest 153,750 153,750 153,750 153,750 138,375 138,375 138,375 138,375 123,000 123,000 123,000 123,000
Business Profit Tax 33,570 158,205
Total Out Flow 1,748,700 1,820,777 1,920,289 2,008,610 1,965,767 1,865,324 1,920,602 2,030,335 2,094,413 1,841,253 1,938,349 2,044,087
Net Flow (400,717) 175,439 390,325 665,958 325,440 420,903 597,308 747,919 378,261 682,807 831,953 1,002,006
Opening Cash
Balance 1,000,000 599,283 774,722 1,165,047 1,831,006 2,156,445 2,577,348 3,174,657 3,922,575 4,300,836 4,983,643 5,815,596
Closing Cash
Balance 599,283 774,722 1,165,047 1,831,006 2,156,445 2,577,348 3,174,657 3,922,575 4,300,836 4,983,643 5,815,596 6,817,602
Appendix 4: workings of quarterly based cash budgets

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5.2.4 Budgeted income statements

In Hotel Accounting, the format of Financial Projections, Departmental Budget (SBU) and
Income Statement is same. It’s the most effective way to calculate the Gross Operating Profit
(GOP) of the hotel. Insurance, Exchange Gain / Loss, Interest on bank loans, amortization of
pre-opening cost, depreciation consider do not mentioned under (SBU) Departmental Budget
and record as below the GOP expenses.

Bandu Well-Being & Ayurveda

Spa Resort
Summary of
Performance (USD)
Below GOP
Year Revenue Expenses G.O.P. % Exp. Tax N.O.P. %

2022 8,339,515 5,813,355 2,526,160 30% 2,286,374 33,570 206,216 2%

2023 9,149,912 5,793,800 3,356,112 37% 2,226,074 158,205 971,833 11%

2024 10,071,993 5,853,428 4,218,565 42% 2,165,774 287,391 1,765,401 18%

Please kindly refer 5.2 Financial Projections for the proposed business Development option

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5.2.5 Budgeted statement of financial position

Bandu Well-Being & Ayurveda Spa Resort

Budgeted Statement of Financial Position
As at 31.12.2024
Pro forma
Currency USD Notes 2024

Property, Plant and Equipment 1 14,827,550

Pre-Opening Project Cost 2 598,800

Current Assets
Inventories 3 1,643,145
Trade & Other Receivables 750,227
Cash & Bank Balance 6,817,602
24,637,324
EQUITY AND LIABILITIES
CAPITAL & RESERVES
Stated Capital 4 16,000,000
Revenue Reserves 5 2,943,450

Long Term Liabilities

Bank Loan 6 3,500,000

Current Liabilities
Trade and Other Payables 1,289,183
B.P.T.Payable 287,391
V.A.T. Payable 230,720
Accrued Expenses 386,581
24,637,324

Appendix 3: Notes to the statement of financial position

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5.2.6 Breakeven Analysis

Bandu Well-Being & Ayurveda Spa Resort

Break Even Analysis - 2022 - Currency USD
Total Rooms available 1,550 1,450 1,550 1,500 1,550 1,500 1,550 1,550 1,500 1,550 1,500 1,550 18,300
Rooms occupied (Gross) 824 865 908 954 1,002 1,052 1,104 1,159 1,217 1,278 1,342 1,409 13,116
Occupancy 53% 60% 59% 64% 65% 70% 71% 75% 81% 82% 89% 91% 72%

January February March April May June July August September October November December Total
Revenue
Total Revenue 524,636 550,194 577,678 606,537 636,839 668,656 702,064 737,142 773,974 812,648 853,255 895,893 8,339,515
Total Occupied Room Nights (POR) 637 636 636 636 636 636 636 636 636 636 636 636 636

Variable Costs
Room Division Expenses 55,275 56,705 58,207 59,783 61,438 63,177 65,002 66,918 68,930 71,043 73,261 75,591 775,330
Food Cost 22,248 23,360 24,528 25,755 27,043 28,395 29,814 31,305 32,870 34,514 36,240 38,052 354,124
Beverage Cost 3,523 3,699 3,884 4,078 4,282 4,496 4,721 4,957 5,204 5,465 5,738 6,025 56,070
Other F&B Cost 742 779 818 858 901 946 994 1,044 1,096 1,150 1,208 1,268 11,804
Spa Cost 20,925 21,971 23,070 24,223 25,435 26,706 28,042 29,444 30,916 32,462 34,085 35,789 333,068
MOD Cost 2,298 2,409 2,525 2,647 2,776 2,910 3,052 3,200 3,356 3,520 3,691 3,872 36,256
F & B Expenses 17,779 17,872 17,969 18,071 18,179 18,291 18,410 18,534 18,664 18,801 18,945 19,096 220,610
Spa Expenses 9,118 9,205 9,296 9,391 9,492 9,597 9,708 9,824 9,946 10,074 10,208 10,349 116,206
A & G Expenses 34,099 34,525 34,963 35,423 35,907 36,414 36,946 37,505 38,092 38,709 39,356 40,035 441,975
MOD Expenses 407 407 407 407 407 407 407 407 407 407 407 407 4,884
Energy Cost 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 480,000
Exchange Gain/ Loss 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000

Total Variable Expenses 207,413 211,931 216,666 221,638 226,858 232,339 238,095 244,137 250,482 257,144 264,139 271,483 2,842,327
Total Variable Expenses (POR) 252 245 238 232 227 221 216 211 206 201 197 193 217

Contribution 385 391 397 404 409 415 420 425 430 435 439 443 419

Fixed Expenses
P a g e 128 | 192
 Payroll & Related-Room 35,500 36,801 38,167 39,601 41,107 42,688 44,348 46,092 47,922 49,844 51,861 53,980 527,911
Payroll & Related-F&B 22,638 22,485 22,972 23,484 24,022 24,586 25,179 25,801 26,454 27,140 27,860 28,616 301,236
Payroll & Related-SPA 17,451 18,024 18,627 19,259 19,923 20,620 21,351 22,120 22,926 23,773 24,662 25,596 254,331
Payroll & Related-A&G 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 522,000
Payroll & Related-S&M 7,250 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 166,750
Payroll & Related-POMEC 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 151,800
Payroll & Related-MOD 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 24,000
POMEC Expenses 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 736,200
Marketing Expenses 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 298,800
Depreciation 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 102,096 1,225,150
Amortization of Pre-Opening Cost 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 24,950 299,400
Interest on Bank Loan 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 615,000
Insurance 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 134,824

Total Fixed Expenses 416,770 425,741 428,197 430,775 433,483 436,325 439,310 442,443 445,733 449,188 452,815 456,623 5,257,402

Total Expenses 624,183 637,672 644,863 652,414 660,341 668,665 677,404 686,580 696,215 706,331 716,953 728,106 8,099,729
NOP / (NOL) (99,548) (87,479) (67,185) (45,876) (23,502) (9) 24,660 50,562 77,759 106,316 136,302 167,787 239,786

Break Even Room Nights 1,083 1,089 1,078 1,068 1,059 1,052 1,046 1,041 1,037 1,034 1,032 1,031 12,544

Break Even Occupancy 70% 75% 70% 71% 68% 70% 67% 67% 69% 67% 69% 66% 69%

In order to break even, Bandu Well-Being & Ayurveda Spa Resort need to sell the above mentioned room nights and the occupancy %.

P a g e 129 | 192
5.2.7 Sensitivity Analysis

Bandu Well-Being & Ayurveda Spa Resort

Budgeted Income statement (Pro Forma)
Currency USD
2022 Adjustment Impact
Description Total
Amount
Statistics
Rooms available per day 50 50 -
Total Rooms available 18,300 18,300 -
Rooms sold (Paying Rooms) 12,734 12,734 -
Rooms Complimentary 382 382 -
Rooms occupied (Gross) 13,116 13,116 -
Occupancy % (Include comp) (Gross) 72% 1 -
Occupancy % (Exclude comp) (Net) 70% 1 -
Average room rate (Include complimentary) 316 316 -
Average room rate (Exclude complimentary) 325 325 -
Average Revenue - (Exclude complimentary) 709 709 -
Number of guest nights 26,741 26,741 -
REVPAR 226 226 -
Food covers 39,347 39,347 -
Number of guest nights (include Complimentary) 27,123 27,123 -

Revenue
Room 4,138,453 5,532,487 (1,394,034)
Food 1,180,414 1,180,414 -
Beverage (None Alcoholic) 295,104 295,104 -
F&B Other 98,368 98,368 -
Spa / Yoga / Ayurveda Center 1,822,651 1,822,651 -
MOD Revenue 60,246 60,246 -
Room Revenue service Charge 413,845 413,845 -
F&B Revenue service charge 148,170 148,170 -
Spa Revenue service charge 182,265 182,265 -
Total Revenue 8,339,515 9,733,549 (1,394,034)
Expenses
Front Office , Reservation & House Keeping
Payroll & Related 527,911 527,911 -
Other Expenses 775,330 775,330 -
-
Food & Beverage -
Food cost 354,124 407,243 (53,119)
Beverage Cost (None Alcoholic) 56,070 56,070 -
Other Cost 11,804 11,804 -
Payroll & related 301,236 301,236 -
Other expenses 220,610 220,610 -
-
SPA , Yoga & Ayurveda Center -
Spa Cost of Sales 333,068 333,068 -
Payroll & related 254,331 254,331 -
Other Expenses 116,206 116,206 -
-
P a g e 130 | 192
 Minor Operating Departments -
Cost Of Sales 36,256 36,256 -
Total Payroll & Related Expenses 24,000 24,000 -
Total Other Operating Expenses 4,884 4,884 -
-
Executive Office , Finance , HR , Training , Security &
IT -
Payroll & related expenses 522,000 522,000 -
Operating expenses 441,975 441,975 -
-
Sales & Marketing -
Payroll & related expenses 166,750 166,750 -
Operating expenses 298,800 298,800 -
-
POMEC -
Payroll & related expenses 151,800 151,800 -
Operating expenses 736,200 736,200 -
Utility Cost 480,000 480,000 -
-
Total Expenses 5,813,355 5,866,473 (53,119)
Gross Operating Profit (GOP) 2,526,160 3,867,076 (1,340,915)
G.O.P. % 30% 40% -9%

Non-Operating Income / Expenses

Insurance 134,824 134,824 -
Exchange gain / loss 12,000 12,000 -
Total Non-Operating Income / Expenses 146,824 146,824 -

EBITDA 2,379,336 3,720,252 (1,340,915)

Interest on Bank Loans 615,000 615,000 -

Amortization of Pre-Opening Cost 299,400 299,400 -
Depreciation 1,225,150 1,225,150 -
TOTAL INT., DEPR. AND AMORT. 2,139,550 2,139,550 -
Income Before Income Tax 239,786 1,580,702 (1,340,915)
Business Profit Tax - 14% 33,570 221,298 (187,728)
Net profit/(Losses) 206,216 1,359,404 (1,153,187)
N.O.P. % 2% 14% -11%

Bandu Well-Being & Ayurveda Spa Resort’s average room rate for year 2022 - USD 325/- and
for the sensitivity analysis, its increases as USD 375/-. Food Cost for 2022 – 30% increased to
35%.The results showing as GOP Increased by 9%, NOP by 11%.

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5.2.8 Ratio Analysis

2022 2023 2024

Gross Operating Profit

1 Ratio Gross Profit 2,526,160 3,356,112 4,218,565

Sales 8,339,515 9,149,912 10,071,993

30.29% 36.68% 41.88%

The gross operating profit ratio is a measure which calculates the correlation between the gross
operating profit margin of the hotel and the net sales (gross sales net of credits and
discounts).(MyAccountingCourse, 2020). GOP has increased from 30.29% to 41.88% by 2024.
In average hotel industry norms above 40% GOP is a very impressed number.

2022 2023 2024

Net Operating Profit Ratio Net Operating profit after

2 (after interest and tax) interest and tax 206,216 971,833 1,765,401

Sales 8,339,515 9,149,912 10,071,993

2.47% 10.62% 17.53%

NOP shows how much net profit a business earns from every dollar of
sales.(MyAccountingCourse, 2020). Even though year 2022 is not much impressed, at least the
hotel could cover all the costs concerned. But in 2024, it’s has shown a significant improvement
of 17.53%. Hotel industry average and preferred ratio is 20% NOP.

2022 2023 2024

3 Current Ratio Current Assets 2,177,295 1,885,602 2,393,372

Current Liabilities 1,913,514 1,743,809 2,193,875

1.14 1.08 1.09

The current ratio is a ratio of liquidity and efficiency which measures the ability of the Hotel
to pay off its short-term liabilities with its current assets. The current ratio is a significant

P a g e 132 | 192
liquidity indicator provided that short-term liabilities are due within the next
year.(MyAccountingCourse, 2020). Hotel has the ability to pay the current liabilities and so far
there is no risk. But by 2024 the ratio has come down to 1.09 which is almost equal to current
assets and liabilities which need to be alert.

2022 2023 2024

Return on Capital (EBITDA ) Earnings Before

4 Employed Ratio (ROCE) Interest and Tax 2,379,336 3,208,088 4,069,341
Total Assets – Current
Liabilities. 18,995,342 20,331,466 22,443,449

0.13 0.16 0.18

ROCE is a productivity ratio that calculates how efficiently a business can produce income
from its employed capital by comparing net operating profit to the employed
capital.(MyAccountingCourse, 2020). Hotel gets 0.13, 0.16 & 0.18 return. In other words,
Hotel earns USD 0.13, USD 0.16 & 0.18 on every dollar invested in employed capital. Hotel’s
return could be so low because of the high levels of assets.

2022 2023 2024

5 Return on Equity Net Income 206,216 971,833 1,765,401

Equity (Owner's Fund) 6,000,000 6,000,000 6,000,000

0.03 0.16 0.29

The return on equity ratio shows how much income each dollar produces from common equity
investors.(MyAccountingCourse, 2020). In this case it’s consider only the capital spend by the
Directors / Owners of Bandu River inn. From the every dollar invested they have earned 0.13,
0.16 & 0.29 dollars. As a percentage 3%, 16% & 29%.

2022 2023 2024

6 Working Capital Turnover Sales 8,339,515 9,149,912 10,071,993

Working Capital 263,781 141,794 199,497

31.62 64.53 50.49

P a g e 133 | 192
Working capital turnover implies the relationship between the funds used to finance the
activities of the Hotel and the subsequent profits created by the Hotel.(KENTON, 2019). By
2024 Hotel shows 50.49 times. Mean the Management of the Hotel use the working capital
very efficiently to generate sales.

2022 2023 2024

7 Debt & Equity Ratio Long Term Liabilities 4,500,000 4,000,000 3,500,000

Equity Share Capital 16,000,000 16,000,000 16,000,000

28% 25% 22%

This shows how many assets the Hotel is obliged to sell to pay off all its
liabilities.(MyAccountingCourse, 2020). In this situation by 2024, from the Equity Share
Capital, the Hotel just need 22% to fully settle the long term liabilities.

5.2.9 Cost Management

❖ Proper Budgetary Control systems

➢ Analyzing Variance. Firstly, budgets are made with estimated figures from different
departments.
➢ Accountability Accounting. Liability accounting is also a good technique for budgetary
control.
➢ Adjusting Funds.
➢ Budgeting on Zero Base (ZBB)

(Accounting Education , 2019)

❖ Training and education of employees

➢ Classroom preparation led by a teacher.
➢ Methods Interactive.
➢ Training is hands-on.
➢ Computer-based training, and e-learning.
➢ Training on video.
➢ Coaching and mentoring services.

P a g e 134 | 192
(wyzowl, 2020)

❖ Continuous performance evaluation

➢ Analyze the correct sort of process
➢ Maintain open process
➢ The executives act as coaches
➢ Train the reviewers and the evaluators
➢ Fix short-term targets
➢ Routine Feedback Session
➢ Customized Workforce Growth Plans
➢ Aligning Targets
➢ Documenting feedback on eliminating bias
➢ Separate the results and remuneration feedback

(GROSUM BLOG, 2020)

➢ Optimize work schedules and training of employees

➢ Watch for utilities
➢ Keep up the repair
➢ Improve on boarding experience for employees
➢ Make the most of technology to automate processes
➢ Strengthen F&B to reduce wastage
➢ Watch the taxes and the insurance

(Social Tables, n.d.)

P a g e 135 | 192
5.3 Schedule for Implementation

The Hotel project will start from 01st August 2020 and the hotel will open on 01st January 2022
(01st paying guest arrival). Construction period will be 12 months. Pre-opening will be 03
months.

Project: "Bandu Well-Being &

Today's Date
Ayurveda Spa Resort" 13 July 2020
19
Days/Weeks Left
Saturday, August 1, 2020 days 2.8 weeks

Remai
Deadline
Start Completed ning Finish
Task # Task Name -/+
Date Days Days Date
weeks
+/-

T1 Market & Feasibility Study 01-Aug-20 -19 152 31-Dec-20 -3

T2 Selection of Land & Acquiring 01-Aug-20 -19 60 30-Sep-20 -3
Company Registration &
T3 01-Aug-20 -19 60 30-Sep-20 -3
Construction Approvals
Announcement and Issue of
T4 01-Oct-20 -80 152 31-Dec-20 -12
Shares to the General Public
T5 Construction of Hotel 01-Oct-20 -80 425 30-Sep-21 -12
Contracting with Tour Operators
T6 02-Oct-20 -81 152 31-Dec-20 -12
/ Suppliers /
T7 Pre-Opening 01-Oct-21 -445 517 31-Dec-21 -65
T8 Recruitment & Training 01-Oct-21 -445 517 31-Dec-21 -65
License / Registration /
T9 01-Oct-21 -445 517 31-Dec-21 -65
Approvals with Authorities
Hotel OSNE & Other
T10 01-Oct-21 -445 517 31-Dec-21 -65
Equipment's Purchasing
Commissioning and Testing of
T11 01-Nov-21 -476 517 31-Dec-21 -70
Equipment's
T12 Test Cooking 01-Dec-21 -506 517 31-Dec-21 -74
Software and Hard ware Install
T13 01-Dec-21 -506 517 31-Dec-21 -74
and Testing
T14 SOPs & P&P 01-Dec-21 -506 517 31-Dec-21 -74
Marketing , Promotion ,
T15 01-Oct-21 -445 517 31-Dec-21 -65
Advertising
Hotel Website , Booking Engine
T16 01-Oct-21 -445 517 31-Dec-21 -65
and Online Reservation

P a g e 136 | 192
5.4 Viability

The proposed business idea is the author's brain child; this idea is evaluated and updated to
achieve the ultimate aim of launching the Hotel being proposed. The alarming number of
increased tourist arrivals has prompted the author to implement this concept.

The target market for the Hotel will be guests / travelers from Europe and developed countries
who are high spenders.The business plan concept statement explains the target market, the
product, the value additionof the Hotel.

The analyzed marketing plan's design and development phase, feasibility research explained
the industry's financial, business, and size, the author emphasized critical success factors and
the Hotel’s risk assessment. Revenue statement and cash flow statement reveal Hotel’s success.

Bandu River Inn will launch the Hotel Project for the international Guests / Travelers to have
a unique experience.

P a g e 137 | 192
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8 Appendices

Appendix 1: Fixed Assets, Depreciation & Insurance Premium

Fixed Assets Depreciation Insurance

Useful Lives
USD Years Annual Monthly Annual Monthly
Freehold Land (Rs.3 Million per
Acres) 1,650,000
Buildings and Building Integral 12,500,000 20 625,000 52,083 100,000 8,333
Plant and Equipment 500,000 10 50,000 4,167 4,000 333
Sewerage Treatment Plant 55,000 10 5,500 458 440 37
Kitchen/Bar Equipment 375,000 10 37,500 3,125 3,000 250
Electrical Equipment 330,000 10 33,000 2,750 2,640 220
Solar Electrical System 80,000 10 8,000 667 640 53
Office Equipment 60,000 10 6,000 500 480 40
Sports Equipment 60,000 10 6,000 500 480 40
Furniture and Fittings 660,000 10 66,000 5,500 5,280 440
Swimming Pool Equipment 52,000 10 5,200 433 416 35
Generator 115,000 10 11,500 958 920 77
Motor Vehicles 100,000 10 10,000 833 800 67
Motor Vehicles - Electric 650,000 10 65,000 5,417 5,200 433
Water Treatment Plant 25,000 10 2,500 208 200 17
Linen, Cutlery and Crockery 275,000 4 68,750 5,729 2,200 183
Laundry and Hot Water Equipment 160,000 10 16,000 1,333 1,280 107
Telephone System 32,000 10 3,200 267 256 21
Elevators 55,000 4 13,750 1,146 440 37
SMA TV System 90,000 4 22,500 1,875 720 60
Maintenance Tools 7,000 4 1,750 146 56 5
Music Instruments 10,000 4 2,500 208 80 7
Bar Furniture and Equipment 135,000 4 33,750 2,813 1,080 90
Computer Equipment & Systems 127,000 4 31,750 2,646 1,016 85

Computer Software 400,000 4 100,000 8,333 3,200 267

18,503,000 1,225,150 102,096 134,824 11,235

P a g e 169 | 192
Appendix 2: Interest on Bank Loan Calculation

Interest on Bank Loan

Calculation Annually Monthly

Long Term Bank Loan 5,000,000 12.30% 615,000 51,250

Capital Interest - Interest -

Capital Payment Balance Year Month
Year 1 5,000,000 500,000 4,500,000 615,000 51,250
Year 2 4,500,000 500,000 4,000,000 553,500 46,125
Year 3 4,000,000 500,000 3,500,000 492,000 41,000
Loan Repayment Period
10 Years
Average weighted prime lending rate (AWPLR) (9.8% + 2.5%)

Appendix 3: Notes to the statement of financial position

Notes to the Budgeted Statement of Financial

Position
Currency USD
Note 01 Depreciation
Fixed Assets Cost 3 Years NBV
Freehold Land 1,650,000 1,650,000
Other 16,853,000 3,675,450 13,177,550
PPE 18,503,000 3,675,450 14,827,550

Note 02
Balance after
Pre-Opening Project Cost Cost Per Year Per Month 03 Years
Company Secretarial Expenses 30,000 6,000 500
Initial Recruitment & Other Related 10,000 2,000 167
Architectural Fees 1,000,000 200,000 16,667
Professional Fees (Lawyers , Surveyors) 400,000 80,000 6,667
Miscellaneous 57,000 11,400 950
1,497,000 299,400 24,950 598,800
Amortization over a period of 05 Years

Note 03
Inventories
F&B 418,398
Linen 395,418
Spa 339,729
Engineering 489,600
1,643,145

P a g e 170 | 192
 Note 04
Stated Capital
Owner's Capital 6,000,000
Issue of Shares through Public 10,000,000
16,000,000

Note 05
Revenue Reserves
2022 206,216
2023 971,833
2024 1,765,401
2,943,450

Note 06
Capital
Long Term Bank Loan Capital Payment Balance
Year 1 5,000,000 500,000 4,500,000
Year 2 4,500,000 500,000 4,000,000
Year 3 4,000,000 500,000 3,500,000

P a g e 171 | 192
Appendix 4: workings of quarterly based cash budgets
Workings
2022
January February March April May June July August September October November December
Revenue 524,636 550,194 577,678 606,537 636,839 668,656 702,064 737,142 773,974 812,648 853,255 895,893
V.A.T 41,971 44,015 46,214 48,523 50,947 53,492 56,165 58,971 61,918 65,012 68,260 71,671
Total 566,607 594,209 623,893 655,060 687,786 722,148 758,229 796,113 835,892 877,660 921,516 967,564

Cash Sales 169,982 178,263 187,168 196,518 206,336 216,645 227,469 238,834 250,768 263,298 276,455 290,269
Credit Sales 396,625 415,946 436,725 458,542 481,450 505,504 530,760 557,279 585,124 614,362 645,061

Q1 Q2 Q3 Q4
Cash Sales 535,412 619,498 717,070 830,022
Credit Sales 812,571 1,376,717 1,593,543 1,844,547

2023
January February March April May June July August September October November December
Revenue 635,567 655,770 676,751 698,545 721,190 744,721 769,178 794,604 821,040 848,534 877,131 906,882
V.A.T 50,845 52,462 54,140 55,884 57,695 59,578 61,534 63,568 65,683 67,883 70,170 72,551
Total 686,413 708,231 730,891 754,429 778,885 804,298 830,713 858,172 886,724 916,416 947,301 979,432

Cash Sales 205,924 212,469 219,267 226,329 233,665 241,290 249,214 257,452 266,017 274,925 284,190 293,830
Credit Sales 677,295 480,489 495,762 511,624 528,100 545,219 563,009 581,499 600,721 620,707 641,491 663,111

Q1 Q2 Q3 Q4
Cash Sales 637,660 701,284 772,683 852,945
Credit Sales 1,653,546 1,584,943 1,745,228 1,925,309

2024
January February March April May June July August September October November December
Revenue 704,317 725,895 748,278 771,504 795,607 820,626 846,602 873,576 901,592 930,696 960,937 992,364
V.A.T 56,345 58,072 59,862 61,720 63,649 65,650 67,728 69,886 72,127 74,456 76,875 79,389
Total 760,663 783,966 808,141 833,224 859,255 886,276 914,330 943,462 973,719 1,005,152 1,037,811 1,071,753

P a g e 172 | 192
Cash Sales 228,199 235,190 242,442 249,967 257,777 265,883 274,299 283,039 292,116 301,546 311,343 321,526
Credit Sales 685,602 532,464 548,776 565,698 583,257 601,479 620,393 640,031 660,423 681,604 703,606 726,468

Receivables as at
31.12.2024 750,227

Q1 Q2 Q3 Q4
Cash Sales 705,831 773,627 849,453 934,415
Credit Sales 1,766,843 1,750,434 1,920,848 2,111,678

V.A.T. 2022 132,201 152,963 177,054 204,944

V.A.T. 2023 157,447 173,156 190,786 210,604
V.A.T. 2024 174,279 191,019 209,742 230,720

Expenses 2022
Front Office , Reservation & House Keeping
Payroll & Related 35,500 36,801 38,167 39,601 41,107 42,688 44,348 46,092 47,922 49,844 51,861 53,980
Payroll & related 22,638 22,485 22,972 23,484 24,022 24,586 25,179 25,801 26,454 27,140 27,860 28,616
Payroll & related 17,451 18,024 18,627 19,259 19,923 20,620 21,351 22,120 22,926 23,773 24,662 25,596
Total Payroll & Related Expenses 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000
Payroll & related expenses 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500 43,500
Payroll & related expenses 7,250 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500 14,500
Payroll & related expenses 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650 12,650
443,365 473,240 500,142 531,281

Food cost 22,248 23,360 24,528 25,755 27,043 28,395 29,814 31,305 32,870 34,514 36,240 38,052
Beverage Cost (None Alcoholic) 3,523 3,699 3,884 4,078 4,282 4,496 4,721 4,957 5,204 5,465 5,738 6,025
Other Cost 742 779 818 858 901 946 994 1,044 1,096 1,150 1,208 1,268
Spa Cost of Sales 20,925 21,971 23,070 24,223 25,435 26,706 28,042 29,444 30,916 32,462 34,085 35,789
Cost Of Sales 2,298 2,409 2,525 2,647 2,776 2,910 3,052 3,200 3,356 3,520 3,691 3,872
156,779 181,452 210,014 243,087

Other Expenses 55,275 56,705 58,207 59,783 61,438 63,177 65,002 66,918 68,930 71,043 73,261 75,591
Other expenses 17,779 17,872 17,969 18,071 18,179 18,291 18,410 18,534 18,664 18,801 18,945 19,096
Other Expenses 9,118 9,205 9,296 9,391 9,492 9,597 9,708 9,824 9,946 10,074 10,208 10,349
Total Other Operating Expenses 407 407 407 407 407 407 407 407 407 407 407 407
P a g e 173 | 192
Operating expenses 34,099 34,525 34,963 35,423 35,907 36,414 36,946 37,505 38,092 38,709 39,356 40,035
Operating expenses 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900 24,900
Operating expenses 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350 61,350
614,982 635,134 658,420 658,438

Utility Cost 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000
120,000 120,000 120,000 120,000

Insurance 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235 11,235
Interest on Bank Loans 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250 51,250
153,750 153,750 153,750 153,750

2023

Expenses
Front Office , Reservation & House Keeping
Payroll & Related 35,855 37,169 38,549 39,997 41,518 43,115 44,792 46,553 48,401 50,342 52,380 54,520
Payroll & related 22,864 22,709 23,202 23,719 24,262 24,832 25,430 26,059 26,719 27,411 28,138 28,902
Payroll & related 17,625 18,205 18,813 19,451 20,122 20,826 21,565 22,341 23,155 24,011 24,909 25,852
Total Payroll & Related Expenses 2,020 2,020 2,020 2,020 2,020 2,020 2,020 2,020 2,020 2,020 2,020 2,020
Payroll & related expenses 43,935 43,935 43,935 43,935 43,935 43,935 43,935 43,935 43,935 43,935 43,935 43,935
Payroll & related expenses 7,323 14,645 14,645 14,645 14,645 14,645 14,645 14,645 14,645 14,645 14,645 14,645
Payroll & related expenses 12,777 12,777 12,777 12,777 12,777 12,777 12,777 12,777 12,777 12,777 12,777 12,777
447,798 477,972 505,144 536,594
Food & Beverage
Food cost 22,470 23,594 24,774 26,012 27,313 28,679 30,113 31,618 33,199 34,859 36,602 38,432
Beverage Cost (None Alcoholic) 3,558 3,736 3,923 4,119 4,325 4,541 4,768 5,006 5,257 5,519 5,795 6,085
Other Cost 749 786 826 867 910 956 1,004 1,054 1,107 1,162 1,220 1,281
Spa Cost of Sales 21,134 22,191 23,301 24,466 25,689 26,973 28,322 29,738 31,225 32,786 34,426 36,147
Cost Of Sales 2,321 2,433 2,551 2,674 2,803 2,939 3,082 3,232 3,389 3,555 3,728 3,910
158,346 183,266 212,114 245,509

Other Expenses 55,828 57,272 58,789 60,381 62,053 63,808 65,652 67,587 69,620 71,753 73,994 76,347
Other expenses 17,957 18,050 18,149 18,252 18,360 18,474 18,594 18,719 18,851 18,989 19,134 19,287
Other Expenses 9,209 9,297 9,389 9,485 9,587 9,693 9,805 9,922 10,045 10,174 10,310 10,452

P a g e 174 | 192
Total Other Operating Expenses 411 411 411 411 411 411 411 411 411 411 411 411
Operating expenses 34,440 34,870 35,313 35,778 36,266 36,778 37,316 37,880 38,473 39,096 39,749 40,436
Operating expenses 18,675 18,675 18,675 18,675 18,675 18,675 18,675 18,675 18,675 18,675 18,675 18,675
Operating expenses 61,964 61,964 61,964 61,964 61,964 61,964 61,964 61,964 61,964 61,964 61,964 61,964
601,710 662,064 645,613 672,871

Utility Cost 40,400 40,400 40,400 40,400 40,400 40,400 40,400 40,400 40,400 40,400 40,400 40,400

2024
Expense
Front Office , Reservation & House Keeping
Payroll & Related 36,210 37,537 38,930 40,393 41,929 43,542 45,235 47,013 48,880 50,840 52,898 55,059
Payroll & related 23,091 22,934 23,432 23,954 24,502 25,078 25,682 26,317 26,983 27,683 28,417 29,188
Payroll & related 17,800 18,385 18,999 19,644 20,321 21,032 21,778 22,562 23,385 24,249 25,156 26,108
Total Payroll & Related Expenses 2,040 2,040 2,040 2,040 2,040 2,040 2,040 2,040 2,040 2,040 2,040 2,040
Payroll & related expenses 44,370 44,370 44,370 44,370 44,370 44,370 44,370 44,370 44,370 44,370 44,370 44,370
Payroll & related expenses 7,395 14,790 14,790 14,790 14,790 14,790 14,790 14,790 14,790 14,790 14,790 14,790
Payroll & related expenses 12,903 12,903 12,903 12,903 12,903 12,903 12,903 12,903 12,903 12,903 12,903 12,903
452,232 482,705 510,145 541,907
Food & Beverage
Food cost 22,693 23,828 25,019 26,270 27,583 28,963 30,411 31,931 33,528 35,204 36,964 38,813
Beverage Cost (None Alcoholic) 3,593 3,773 3,961 4,159 4,367 4,586 4,815 5,056 5,309 5,574 5,853 6,145
Other Cost 756 794 834 876 919 965 1,014 1,064 1,118 1,173 1,232 1,294
Spa Cost of Sales 21,344 22,411 23,531 24,708 25,943 27,240 28,602 30,033 31,534 33,111 34,767 36,505
Cost Of Sales 2,344 2,457 2,576 2,700 2,831 2,968 3,113 3,264 3,423 3,590 3,765 3,949
159,914 185,081 214,214 241,939

Other Expenses 56,381 57,839 59,371 60,979 62,667 64,440 66,302 68,256 70,309 72,464 74,727 77,103
Other expenses 18,135 18,229 18,328 18,433 18,542 18,657 18,778 18,904 19,037 19,177 19,324 19,478
Other Expenses 9,300 9,389 9,482 9,579 9,682 9,789 9,902 10,020 10,145 10,275 10,412 10,556
Total Other Operating Expenses 415 415 415 415 415 415 415 415 415 415 415 415
Operating expenses 34,781 35,215 35,663 36,132 36,625 37,142 37,685 38,256 38,854 39,483 40,143 40,836
Operating expenses 19,049 19,049 19,049 19,049 19,049 19,049 19,049 19,049 19,049 19,049 19,049 19,049
Operating expenses 62,577 62,577 62,577 62,577 62,577 62,577 62,577 62,577 62,577 62,577 62,577 62,577
608,234 628,788 652,571 680,099

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Utility Cost 40,800 40,800 40,800 40,800 40,800 40,800 40,800 40,800 40,800 40,800 40,800 40,800

P a g e 176 | 192
Appendix 5 Tourism Statistics
I. Accommodation Capacity & Guest Nights in Graded & Supplementary Establishments2007 to 2018
Description 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017* 2018*
Accommodation Capacity
(Tourist Hotels)
(a). No. of Units 245 256 242 253 252 269 304 334 354 382 401 457
(b). No. of Rooms 14,604 14,793 14,461 14,714 14,653 15,510 16,655 18,078 19,376 22,136 23,477 24,757
(c). No. of Beds 27,500 28,698 28,344 28,978 28,844 30,399 34,840 36,883 38,370 45,509 47,259 50,897
Accommodation Capacity
Supplementary Establishments
(a). No of Units 513 578 629 530 654 930 1,021 1,265 1,409 1,558 1,693 1,855
(b). No. of Rooms 5,030 5,397 5946 5,895 6,141 8,207 8,513 9,916 10,702 11,535 12,509 13,457
(c). No. of Beds 8,299 9,712 11,654 11,210 11,601 13,347 16,105 18,340 20,211 21,570 23,392 25,973
Guest Nights Tourist Hotels
(a). Foreign 2,777,599 2,763223 2,818,487 4,126,544 5,011,480 5,038,066 6,969,239 7,982,110 8,945,380 10,595,118 11,609,886 12,608,044
(b). Local 1,051,077 979,438 1,163,220 1,464,098 1,607,393 1,457,063 1,439,483 2,072,886 1,588,223 1,727,298 1,805,141 1,984,891
Guest Nights – Tourists Hotels
(a). Foreign 598,931 701,254 779,317 1,249,146 2,241,407 2,372,266 2,728,603 3,596,548 4,349,313 5,404,602 6,204,126 6,805,139
(b). Local 497,321 421,987 471,730 425,350 574,958 682,374 639,275 512,017 636,644 816,297** 920,196 952,176
Foreign Tourists Nights (Total) 4,940,080 4,165,511 4,075,799 6,544,760 8,559,750 10,056,050 10,909,050 15,118,815 18,163,638 20,918,486 23,068,836 25,204,996
(a). Tourists Hotels 2,777,599 2,763,223 2,818,487 4,126,544 5,011,480 5,038,066 6,969,239 7,982,110 8,945,380 10,595,118 11,609,886 12,608,044
(b). Supplementary 598,931 701,254 779,317 1,249,146 2,241,407 2,372,266 2,728,607 3,596,548 4,349,313 5,404,602 6,204,126 6,805,139
Establishments
(c). Others 1,563,550 701,034 477,995 1,169,070 1,306,863 2,645,718 1,211,204 3,540,157 4,868,945 4,918,766 5,254,824 5,791,813
`

*Tourists Hotels – Classified / Unclassified / Boutique Hotels

*Supplementary Establishments – Boutique villas / Guest Houses / Home Stays / Bungalows / Rented Apartments & Rented Homes
*Estimated

P a g e 177 | 192
 II. Revenue from visitors to conservation forests – 2018
Name of the Forest Number of Visitors Total Income Without VAT Total
Domestic Foreign Domestic Foreign
Tourists Tourists Tourists Tourists
Makanda Conservation 2,313 1,246 3,559 54,848.35 736,931.00 791,779.35
Forest
Kottawa Conservation 1,804 368 2,172 43,855.00 231,695.00 275,550.00
Forest
Kanneliya Conservation 62,472 2,307 64,779 1,385,644.50 1,295,175.00 2,680,819,50
Forest
Hurulu Eco Park 20,628 36,664 57,292 1,557,508.68 47,023,695.63 48,581,204.31
Sinharaja Conservation 42,472 15,549 57,689 844,526.49 8,235,760.00 9,080,286.49
Forest
Udawatte Kele 21,472 12,654 34,126 527,139.85 7,156,065.00 7,683,258.85
Conservation Forest /
Kandy
Knucles Conservation 65,501 2,604 64,105 1,376,936.67 1,455,013.50 2,831,950.17
Forest
Kande Ela Forest / 3,082 5 3,087 46,145.00 2,558.00 48,703.00
Nuwara Eliye
Total 215,421 71,397 286,818 5,836,658.54 66,136,893.13 71,937,552

Source: Department of Forest Conservation

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III. Details by Location 2018
Foreign Tickets Local Tickets
Location Number Of Revenue Number of Revenue Total
Foreign (Rs.’(000) Domestic (Rs.’(000)
Tourists Tourists Revenue (Rs.’(000)
Peradeniya 431,199 627,060,500.00 1,109,125 52,600,650.00 679,661,150.00

Hakgala 31,626 45,115,750.00 782,581 35,381,210.00 80,496,960.00

Gampaha 385 554,500.00 157,698 8,693,530.00 9,248,030.00
Mirijjawila 275 392,000.00 80,822 3,215,620.00 3,607,620.00
Seethawaka 210 305,500.00 234,423 11,453,280.00 11,758,780.00
Total 463,695 673,428,250.00 2,364,649 111,344,290.00 784,772,540.00

Source: Department of National Botanical Gardens

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 IV. Percentage Arrival & Department by & Category of Travelers 2018
Port Total Sri Lankan Residents Foreign Tourists
Arrivals Departures Arrivals Departments Arrivals Departures
Katunayake 3,731,847 3,718,781 1,484,891 1,471,891 2,246,956 2,247,300
Mattala 1,237 1,678 283 358 954 1,320
TOTAL AIR 3,733,084 3,720,459 1,485,174 1,471,174 2,247,910 2,248,620
Colombo Harbor 70,751 69,230 2,077 1,381 68,674 67,849
16,753 14,647 2,265 1,950 14,488 12,697
Galle Harbor 2,907 3,754 175 759 2,724 2,995
Other Ports * 90,411 87,631 4,517 4,090 85,886 83,541
TOTAL SEA
3,823,495 3,808,090 1,489,691 1,475,929 2,333,796 2,332,161
TOTAL (Sea & Air)

*Hamatota/ Norochcholai / Trincomalee/ Mannar

Source: Department of Immigration and Emigration

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