1. 2017
Ms. Anja Papathanassis
Module: Business Entrepreneurship
International Graduate Center –
Hochschule Bremen
Prepared By:
Hassan Syed Ahmed
Enoch F. Toppo
FESTIVAL EXPRESS – Business
Plan Report
2. Contents
Executive Summary.................................................................................................................................3
Essence................................................................................................................................................3
Service.................................................................................................................................................3
Opportunity ........................................................................................................................................3
Competitive Advantage ......................................................................................................................4
Plan for expansion ..............................................................................................................................4
Idea Concept and Assumptions ..............................................................................................................4
Market Analysis.......................................................................................................................................5
Industry...............................................................................................................................................5
Beachhead market..............................................................................................................................5
Target Customer .................................................................................................................................6
Total Addressable Market...................................................................................................................6
Competition ............................................................................................................................................7
Short-term and Long-term..................................................................................................................7
Strengths & Weaknesses ....................................................................................................................8
Competitive Advantage ......................................................................................................................8
Team .......................................................................................................................................................9
Names & Positions..............................................................................................................................9
Roles & Responsibilities....................................................................................................................10
The Company: Festival Express.............................................................................................................10
Vision.................................................................................................................................................10
Mission Statement............................................................................................................................10
Goal...................................................................................................................................................11
Services .............................................................................................................................................11
Tagline...............................................................................................................................................11
Legal Framework...............................................................................................................................11
Entry & Growth Strategy...................................................................................................................11
Marketing Plan......................................................................................................................................12
Go-To Market Strategy .....................................................................................................................12
Sales Process.....................................................................................................................................13
Business Model.................................................................................................................................13
Pricing Framework & Strategy..........................................................................................................14
Services Strategy...............................................................................................................................15
Distribution Strategy.....................................................................................................................15
Advertising and Promotion...........................................................................................................15
3. Operational Plan ...................................................................................................................................16
On-going Operational Plan ...............................................................................................................16
Geographic Location selected...........................................................................................................17
Facilities and Improvements.............................................................................................................18
Development Plan.................................................................................................................................19
Development Strategy......................................................................................................................19
Critical Risks ..........................................................................................................................................19
Competitor Action ............................................................................................................................19
Rescue Plan.......................................................................................................................................20
Exit Strategy......................................................................................................................................20
Offering (Funding Request)...............................................................................................................21
Financial Plan ........................................................................................................................................21
Financial Summary............................................................................................................................21
Projected Income Statement............................................................................................................23
Projected Cash Flow Statement........................................................................................................24
Projected Balance Sheet...................................................................................................................24
Break-Even Analysis..........................................................................................................................25
Website.................................................................................................................................................26
4. Executive Summary
Essence
Festival Express is basically a transportation and facilitator service provider for Festivals
around Europe. Initially, we are targeting Chiemsee Festival held in Übersee, to operate
shuttle services along with excursions to nearby locations around Chiemsee. This company’s
goal is to offer affordable, reliable, and safe transportation with excursions to its customers,
making them to avoid the tremendous inconveniences that often go along with driving to
the venue. The reason to choose our services is to enhance their festival experience by
traveling along with fellow festival-goers along with visiting nearby beautiful locations and
indulging in adventurous activities in the nearby and beautiful locations. This would enhance
their festival going experience as many travel to these festivals but aren’t able to see the
beautiful locations that these festivals are hosted around.
Service
Festival Express has a main focus and our sales period is set to the summer months initially
from the Chiemsee Summer Festival and it will operate from multiple locations (five cities or
town )to pick up our customer. Target location are being set to Munich , Salzburg, Trostberg,
Rosenheim and Wasserberg am Inn. Festival Express provides entertainment and true
pleasure of excursions to students and the young generations. Our core services allow
students and young generation to avoid worries of parking and traffic rush, leaving them
with more time and energy to have fun with their friends. Beside the revenue earned from
sales Festival Express will also generate extra revenue from refreshments and festival props
provision services. For the props, Festival Express will offer an innovative type of
advertisement for prop artists and artisans who are willing to expand their market reach
directly to the festival goers. Apart from sales of these props, we shall also rent out these
props to the customers on a deposit basis.
Opportunity
There are plenty of opportunities for Festival Express to take advantage of. Firstly Germany
has a lot of festivals happening during the summer months but there is no official festival-
only transport service. The market is still open to players who can enter in to capture this
growing demand, unlike U.K. where Big Green Coach Services has taken over the entire
market by claiming exclusive rights to those services. It has been observed that there are no
transport facilities for festival goers with normal tickets, only the ones with VIP ticket holders
have that service. Also none of the festival transport shuttle service providers are giving
additional excursion services to their customers around the festival venue or enroute the
venue. While booking seats on the current festival transport shuttle service providers, there
is no feature to view seating availability nor is there a feature to have a waiting list for seat
booking for the customers; a feature to accommodate this would make the online booking
service quite user-friendly. This is where Festival Express comes in and provides our
customers with all these features and facilities that are currently lacking in the market.
5. Competitive Advantage
Festival Express has taken into consideration all the weaknesses of our competitors and we
will be rectifying and implementing those into our current strategies. Currently our
competitors are only focussing on providing transport and accommodation facilities along
with on-board services for comfort and refreshments. Festival Express starts where our
competitors stop to enhance their services by providing convenience, comfort and additional
value to make our customer’s journey so memorable that they will want to re-experience
the same with their friends every time. In addition to this, Festival Express will offer an
opportunity for our potential customers to win free shuttleservices to Chiemsee Summer
Festival on the basis of lottery system which they are guaranteed to win once in their
numerous journeys with us. Working with event organizers, social media promoters, rural
village tourism suppliers, and bus charter companies, Festival Express would be able to
create essential partnerships with them and cater to our customer’s demands.
Plan for expansion
We analysed that while Chiemsee Summer Festival would be an attractive place for festival
goers, the demand for excursion facilities is widespread all across Bavaria. Festival Express
plans to extend its operation to more destinations around Chiemsee, establish more
partnerships with other festival organizers within the span of 5 years and eventually recreate
the Festival Express experience for artists traveling from one festival to another. In order to
accommodate all this Festival Express has planned to buy own buses by the end of the third
year and continue buying buses to facilitate our customers and provide clean and green
buses by reducing CO2 emissions and operating on solar panels for electronic charging
thereby reducing fuel consumptions. Also, with the growing popularity amongst festival
goers, event organizers and artists, Festival Express aims to organize its own festival to as
jubilation to the efforts put in creating an amazing name in the market.
Idea Concept and Assumptions
The idea behind starting this business for the Festival Express shuttle servicecame from
Enoch’s love formusic and a documentary movie that inspired him quite a few years back. It was
about this Train called none other than “Festival Express”, back in the 1970s, when a train filled with
the music stars of thatera – Janis Joplin, The Band,Grateful Dead, Buddy Guy Blues Band, Flying
Burrito Brothers, Mashmakhan, Seatrain and many more, travelled from Toronto to Calgary, playing
music at the festivals organized in the cities along the route and jamming with everyone throughout
the train.
This sparked an idea within him to recreate a similar experience with respect to the music scene in
today’s time. Hence, this gave birth to our concept the “Festival Express”, a festival transport shuttle
service with a twist. We decided to start our services first with the festival-goers and eventually in
the future, when we make our name and establish strong partnerships we shall host an artist-only
Festival Express bus service, traveling from Festival to Festival to hosting and organizing an entire
festival of ours. However the only twist to that concept is that we plan to involve the festival-goers
with an additional service, of showing them around the interesting places filled with activities that lie
around or enroute the festival venue so as to enhance their festival experience with us.
6. Before starting with our Business Plan, we would like to highlight the various assumptions that we
have based our report upon. They are as follows:
- All the licenses to be approved for conducting our services between the mentioned
destinations of – Munich, Salzburg, Rosenheim, Trostberg and Wasserburg Am Inn, along
with the routes for our excursions to Marquartstein, Bechtesgaden, Kampenwand,
Chiemsee.
- We have established partnership with the organizers of the first festival (Chiemsee
Summer Festival) we are targeting to operate our services to and from Chiemsee – CRP
Konzertagentur GmBH based out of Hamburg.
- Our advertising and promotional campaigns have been converted into sales from the
various locations and mediums selected.
- We have achieved 100% sales (Seating capacity) of the target market share we hope to
reach out to during the Chiemsee festival for both the services offered by us.
- During the start of our operations, we hope to charter a certain number of mini-buses
and big buses to accommodate all our customers. We hope to have established
connections with the bus charter companies in order to give us the required number of
buses at the mentioned times.
- We hope to have established rental parking facilities (Warehouse parking) in Augsburg,
for our mini-bus and caravan in the initial stage of our business and then for the other
buses that we would be purchasing after 2 years.
- Employees’ requirements are fulfilled and we are able to hire enthusiastic and loyal
employees to carry out various functions required for managing the business.
- Chiemsee festival is able to attract a lot of festival-goers so that we are able to tap into
our market share.
Market Analysis
Before starting the business, a market analysis is required in order to take calculated risks to
avoid major dead-end. We need to see if there is adequate demand for the services we hope to
provide to our customers. Also, we need to analyse the various competitors that are already in the
market to come up with the right strategies to have a considerable market share.
Industry
The industry that our business is related to is music, transportation and tourism. It
will be catering to the Tourism value chain from the aspect of a Tour Operator as we would
be providing excursions in a package, along with shuttle service to and from the festival. We
would also be a part of the Transportation and Incoming services sector of the Value Chain
as we are a transportation provider along with day-excursions around or enroute to the
venue.
Beachhead market
The beachhead market selected for our new venture – Festival Express is Chiemsee
Festival in Übersee, Bavaria, South Germany.This festival is attended by a lot of youngsters
around 27000 as per the statistics of the previous year (2015). Most of the youngsters
attending this festival are on a summer break and are well funded to make the trip
memorable for them. The line-up at such an event is massive as well, gathering big names
7. from the music industry across various genres to play in one are area for 4 days. This would
attract a lot of youngsters in need for transportation to take them without much hassle to
the venue and back to the station for them to return home. With our services they would
not only enjoy the festival at competitive prices but also be able to view the neighbouring
areas (interesting sites) at affordable prices. With such a massive event there comes quite a
lot of competition for us to be blocked out of the market, however, with our Unique Selling
Points, we hope to maintain our stand in the competition. The results of the business are
immediately known within a span of 5 days during the festival through the number of
bookings being placed.
Target Customer
As mentioned earlier our Target Customers are students, young professionals or
artists. To give a better description of our target customer, it is as follows:
Gender:Male, Female, and Transgenders
Age Range: 18-30
Region: Germany, Austria, and other European nations
Occupation: Student, Artists, Professionals
Social Background: Culture oriented, Music-lovers, Europeans
Characteristics: Adventurous, Social, Free-spirited, Enthusiastic, Energetic
User Category: Explorers, Bag-packers, travellers, Partygoers
Other: Friendly, seek newer experiences, outdoorsy, escapism, light-travellers,
smartphone users, active social media users
Profile
They are young students or professionals, who are fun &thrill seekers and
want to enjoy their summer in the best possible way – in a festival. They travel
light and prefer hassle-free traveling. They are explorative and adventurous in
nature and are willing to try new things in life.
Deciders:They are the groups of youngsters or individuals seeking excursions or
shuttle services from an easy and accessible city to the festival venue and
provisions to bring them back to the same spot.
Buyers: They are the same group of youngsters or individuals who understand
the value of our services and purchase the same.
Total Addressable Market
To get the ideal number of customers we could be reaching out, we would look at
the number of visitors that attended the festival last year. As per the records obtained from
their Facebook page, there were total of 27000 fans gathered on the last day of the festival
in August 2015. Hence we can consider this to be our Total Addressable Market. However,
out of these 27000 fans, we have considered 15000 customers who wouldn’t be traveling in
their own vehicles (car, motorbike, caravan, mini-van, etc.) to avoid the parking issues and
maintenance. Of which, Festival Express looks to cater to 2000 people in the opening year of
its operations, owing to the fact that we don’t yet have a market presence and these
number of people would be attending the festival on a normal ticket and thus are ineligible
to avail the Chiemsee festival shuttle service. Our market share is therefore calculated
8. moderately, keeping in mind the competitors and our market presence to gather more
customers for using our services.
No. of Festival goers
(2015)
Total Addressable
Market
Market Share
27000 15000 2000
Competition
There are quite a few companies, already conducting and organizing the basic kind of
services that we would be providing. Therefore, we need to look at the kind of services that they are
providing in order to beat their prices and also provide the extra services that they are currently not
providing and it is something that would take them time to initiate as well.
Short-term and Long-term
Our short-term competitors include names like Spotify which has been included recently to
provide shuttle services for a small group up to 13 passengers from Munich to Chiemsee.
They are providing private services to groups of people for a higher amount as they also
include ticket collecting facilities along with in-bus refreshment services.
The other competitors are the Chiemsee festival shuttle service. However, they also provide
services only for the VIP ticket holders and not for the normal ticket holders. They provide
shuttle services from the nearby towns of Rosenheim, Trostberg, Wasserburg am Inn, and
Salzburg.
Our long-term competitors include big names like Bla-Bla car, which is a carpooling service
in Germany. It is a platform for car owners to sell their car seat space online and the seat
occupiers to book it. Usually the car owners mention the source and end destination
according to which they accommodate the seat sharers. Apart from the Bla-Bla car
application, there are also many individual carpoolers who would be catering to the needs
of many individual festival goers.
Apart from the car-pooling services, there is Big Green Coach services, a U.K. - based festival
only transport shuttle service also known as Planet Festival in the rest of Europe. In U. K.
they have taken complete hold on all the major festivals around U. K. by being the official
coach shuttle service. However, their Planet Festival venture hasn’t yet captured the
European festival market. They are currently the official partners for a few major European
music festivals in Germany, Paris, Belgium, Hungary, etc. But they do have the potential and
capacity to capture the markets that we are trying to cater to as they are better known
amongst event organizers and event management companies.
The other long-term competitor identified is the Metal Travels, which is the official shuttle
service for the Wacken Festival near Hamburg. They are also capable of taking away our
market share as they are well established and have more vehicles and can provide more
services in Germany.
9. Strengths & Weaknesses
Strengths: If we group all the short-term and long-term competitors, we can say that they
have a lot of strengths in the European market. Firstly, they have a greater market share and
more well-known and have a better visibility in the European festival circuit than Festival
Express, a new entrant. Due to their long-standing associations with many festival organizers
they have established many official partnerships and thus are able to provide multiple
festival tickets to their customers travelling on their coaches. Apart from these facilities, they
are also able to provide additional facilities, like accommodation around the venues or inside
the venue, in-bus services like refreshments or comfort (blankets, neck-cushions, etc.) to
their customers. These reasons make them a favoured choice amongst the customers
seeking transportation services to and from the festival venues.
Weaknesses: When it comes to weaknesses, we can say that have quite a few but it is
enough for us to capitalize on the same. None of our competitors provide additional
excursions/side-trips alongthe route of or around the festival venue. It has been observed
that while booking the tickets on our competitor’s website, the users are not able to see the
seat availability options and neither is there any facility to keep them on waiting list, which
leaves them in a limbo whether they would be able to avail the shuttle services or not until
the last moment. They also don’t provide anything extra to the customers – like festival
props which they could use to flaunt inside the festival venue. Also very few in-bus services
are provided, and most of the facilities are provided to the VIP ticket holders only, the
normal ticket holders are usually left behindwhen it comes to availing additional facilities
and services.
Competitive Advantage
There are quite a number of reasons why we would have a competitive advantage over our
competitors. They can be categorized under the following:
We provide an easy and user-friendly online booking services for our customers
Customers have the provision to select their seats while on the shuttle service;
Our website would also have the facility to view booking capacity visibility andif
there aren’t any seats available there is an additional feature to show the
waiting list for next available seats, which would give us the chance to charter
additional buses to accommodate our customers.
We would provide the additional benefit of day-trip excursions – before or after
the festival for our customers. The locations we would take our customers to
would include - (Munich/Rosenheim/Wasserberg am Inn – Marquartstein,
Kampenwand, Chemgauer Alpen, Chiemsee & Salzburg – Berchtesgaden, Inzell,
Chiemsee).
Our in-bus services would include welcome tea/coffee/fruit juices, which would
be provided free for the first time and then on the basis of our Festival Express
color bands, we would provide them refreshments inside the venue at slightly
discounted prices in comparison to the normal festival-goers.
Once a customer books a ticket with us, his/her details will be stored with login
details in our database so that he/she can avail our special lottery based free 2-
way transit ticket after availing 5 times services from us.
Apart from the in-bus services, we shall also be providing our customers with
festival props which we would either sell or rent to our customers on deposit
10. basis. We would be collaborating with various artists to promote their wares as
well as coax them to promote our services to their friends and networks.
We would provide feedback form both onsite and online to all our customers to
better improve our services/site locations for excursions as well as take their
preferred festival requests for the future to expand our reach, based on the
volume of requests.
In our own buses, we shall provide electrical charging of all electronic devices
through solar-panelled sheets installed on the roof of the buses to reduce fuel
consumption as well as promote clean and green energy.
With the help of our excursion we shall establish good network with the rural
facility providers to enhance our customer’s experiences within the locations we
shall be taking them to.
As part of a clean-up initiative, we shall provide the festival organizers with the
option of cleaning up the venue after the festival and involve our customers who
would prefer to go for an excursion after the festival. In return we shall work out
an arrangement to give discounted prices on the next festival tickets for those
volunteers helping out.
Figure 1. Competitive Positioning; Source: Self-composed
Team
Our Team consists of a few people and their names and responsibilities are as follows:
Names & Positions
Enoch F. Toppo: Chief Executive officer (CEO)
Hassan Syed Ahmed: Chief Financial Officer (CFO)
11. Roles & Responsibilities
Enoch has Software Engineering background with 6 years’ experience in the field of
Information Technology, along with a Master in Business Administration in the field of
International Tourism Management. Through his education, he has acquired good
knowledge of Business Strategy, Negotiation techniques, and Marketing Strategy. Apart from
these skills, he is also good in establishing networks quickly, he has a keen sense of noticing
market trends and he has been to quite a few music festivals to gather enough knowledge to
think like our customers.
Hassanhas Finance and Accounting background and has worked in this field for 2 years along
with a Master in Business Administration in the field of International Tourism Management.
Through his education and experience, he has gathered good administration skills along with
team management skills and is good at playing with numerical data.
Apart from the CEO and CFO, we would be hiring 3 more full-time employees to help us out
with marketing, administration and website maintenance. The profile requirements for
these employees would be as follows:
- Young millennials – to better understand our customers
- Updated on the latest trends, music, fashion, festivals, etc.
- Active social media user to operate on the various Social networking channels for our
marketing and distribution efforts – Facebook, Twitter, Snapchat, Instagram, Pinterest,
Whatsapp, etc.
- They would need to be creative in their approach as creativity is basis of innovative
methods
- Website developer and maintenance (IT support) – to handle the website requests and
support.
The Company: Festival Express
Vision
Our vision is to obtain shuttle service rights (official partner) for music festivals across
Europe for revellers and artists and to eventually organize our own festival
Mission Statement
To provide the joy of travelling with fellow festival-goers
To reduce independent travelling in order to facilitate fewer CO2 emissions and
fewer parking hassles at the festival venue
To provide the benefit of visiting nearby locations from the festival venue thereby
bridging economies of the surrounding areasin growing together
12. Goal
To obtain exclusive shuttle service rights to 3 music festivals within Germany in the
next 5 years
To provide satisfaction of services provided to at least 75% customers
To become the first choice for festival goers in transportation services to and from
the festival venue
Services
Our services include:
Shuttle along with nearby excursion services around the festival venue
Easy booking & booking availability checking and waiting services
In-bus tea and refreshments
Festival props for sale or rental purposes for our customers
Tagline
Our tagline is: “Festival Begins Here!!”
We believe, by selecting our services, our customers will be able to enjoy the festival
experience right from the time they board our buses till the time they are dropped back at
their respective locations.
Legal Framework
Our company will be a small and medium enterprise and in legal terms will be a Limited
Liability Company (GmBH) with equity of € 200. The registration charges for forming this
type of company will be € 150 and the application charges incurred for the registration will
be € 250. Apart from this there will be additional charges for hiring a specialized startup
attorney to take care of all the legal formalities associated with starting the company.
Festival Express will be registered in the city-state of Bremen.
Entry & Growth Strategy
The entry and growth strategy formulated for Festival express are as follows:
Tour Operator License approval is to be acquired to start off with our services in the
mentioned locations
Stronger alliances with Festival Organizers especially CRP Konzertagentur GmBH
(Chiemsee Festival) to have access rights to provide our services to our customers
Right conversion of projected customers
13. Our competitors should not have objections to our undertaken service routes
Promotion of and through festival prop sellers with regards to our services as well as
the income generated from commission of selling their props (20%)
Customer sales & loyalty programs through our lottery based customer acquisition
system
Purchase of new buses to curtail our dependency on the bus charter companies as
well be able to install solar-panels to charge the electrical appliances on board as
well as have a considerable amount of fuel reduction
Growth strategy would be to eventually increase our services to other festivals
within Germany
Organize special bus services only for artists traveling between the festivals we are
providing our services to
Eventually organizing our own festival within Germany
Marketing Plan
The Marketing plan involved for Festival Express includes certain steps that will be required for
better implementation of our services.
Go-To Market Strategy
The Go-To Market strategy for our services is as follows:
A strong alliance with Chiemsee festival organizer – CRP Konzertagentur GmBH – To
promote our services on their website and facebook page along with the online
flyers. This is required initially to get our name recognized amongst our customers.
This will involve an indirect sales distribution to CRP Konzertagentur GmBH. We will
decide on maintaining the sales percentage range of 5%-15% of all sales acquired
through their website and facebook page. The same will monitored from softwares
to track the traffic inflow.
Our employees will track the social media profile pages of previous visits and
enquiries made for Chiemsee festival to channelize our promotions directly to them.
We shall promote at bus and railway stations – Munich, Salzburg, Berlin, Hamburg,
Bremen, Heidelberg, Osnabruck & Frankfurt on weekends during peak hours (i.e.
Fridays: 09:00-11:00 and 16:00-20:00 and Sundays: 11:00-13:00 & 17:00-19:00)
Promotion at big university campuses – on weekdays (Mon – Fri, during lunch hours
until 16:00 hours) - Mensas and Studentwerk campuses (Evenings 16:00-18:00)
Flyers near student popular clubs/discos –especially on student nights (Uni-nachts)
Making stronger alliances with bus charter companies to provide the supply when
the demand increases during the season.
Promotion of lottery based customer benefit system to attract the youngsters who
are looking for ways to reduce their expenses.
14. Solar-powered electrical charging – Promote Green Tourism initiatives amongst our
customers to make them socially responsible users.
Sales Process
The sales process for our customers includes the following steps taken to meet our
expenses.
Short-Term
In the beginning we aim to have mass promotional efforts to get the name
of our company amongst our customers.
We shall encourage only advance bookings through website in order to
match the requirements for the charter services.
We shall be relying upon Indirect sales for atleast 60% in the initial period.
Through social media the task of our employees would be to segregate
customers asking for details for Chiemsee festival and promote all of our
services to them.
We would need to consistently follow-up with our customers for up to 1
month before the start of the festival in order to confirm their ticket sales.
We shall be relying heavily upon word-of-mouth promotion.
Medium-Term
Apart from following all the steps involved in the short-term sales process, we shall
add or reduce certain efforts to minimize our costs.
Once we have gained a name in the market and amongst our customers we
intend to have reduced Indirect sales (through organizer’s webpage).
We shall communicate with our previous customers and encourage them to
opt for our excursion trips as well.
Long-Term
We shall include promoting through local radio for more customer visibility.
Encourage more of our previous customers to opt for excursion trips.
Keep following– up with our customers regarding feedback and informing
them about our improvisations to various services.
Business Model
The business model used for our operations is as follows:
15. Figure 2. Business Model; Source: Self-composed
The above figure indicates that customer will directly book tickets through our website and
we shall provide them with our services. Also the customer has the opportunity to book our
services through the Event Organizer’s page, however, the customer would still be directed
to our website, and we shall, like explained earlier, provide our services to the customer.
However, since this is an indirect sales, the commission for booking our services through
their platform is involved and we will distribute the percentage sales thereof to the
organizer in bulk, after the festival commences. Apart from the expenses, we also need to
make purchases from our various suppliers who will be providing us with their services to
facilitate our business functions. They include suppliers like the Bank for the loan that we
shall be taking to start our business; Bus Charter Company to hire the buses and meet our
customer’s needs for pick-up and drop; we would also be outsourcing our website
development to a cheaper destination (like South-east Asia) to develop a robust, scalable
website to meet our needs; and other suppliers for festival props, tea and refreshments, etc.
For all these services we shall making due payments to them.
Pricing Framework & Strategy
To begin with, we have kept our prices in check with our competitor’s prices to maintain
feasibility by our customers. The prices will also be based upon the additional value in term
of excursions and additional services provided to the customer.
The prices determined would be different for different locations as pick-up points. They are
as follows:
Destinations - Shuttle Price (in Euros - €)
Munich 40
Rosenheim 20
Wasserburg Am Inn 15
Trostberg 10
Salzburg 25
Destinations – Excursions Price (in Euros - €)
16. Munich 59
Salzburg 55
Each year we intend to increase the prices by 10%-20% as they are dependent on various
factors – fuel, taxes, bus charter prices, festival ticket, repair and maintenance costs,
parking,etc. The prices would also differ in terms of the services requested and the locations
selected for the shuttles/excursions. For cancellations, the entire price of the ticket would be
refunded back to the customer if they are able to cancel the request 1 week prior to the
start of their services. Otherwise there would be considerable deductions on the amount
refunded back to the customer – 15% deduction for each day after the full refund time (1
week).
Services Strategy
For the promotion and distribution the strategies involved are:
Distribution Strategy
For distribution we shall be using the following methods:
Social Media – through all the major social networking applications and
websites –Facebook, Whatsapp, Instagram, Pinterest, Snapchat, etc.
At the University Campuses – Mensa for the destinations – Munich, Berlin,
Hamburg, Bremen, Frankfurt, Cologne, Salzburg
Outside popular nightclub joints in the major cities, especially on student
nights
Using Google Analytics to get known and inform for promotion of our
website – to get bookings
On board festival props promotion and sales
Advertising and Promotion
With regards to our advertising and promotion, we shall be using the following
strategies and modes:
We shall start with our promotions 8-9 months before the festival
commences.
Heavy promotions through social media applications and sites – Facebook,
Twitter, Pinterest, Instagram, Snapchat, Whatsapp, etc.
Promotion on event organizers website/social media (Facebook) page
Promotion at University campuses – Mensa (during the afternoons)
Central bus & railway stations (Weekends – Fridays: 09:00-11:00 and 16:00-
20:00 and Sundays: 11:00-13:00 & 17:00-19:00)
17. Select few clubs & discos (weekends – Friday and Saturday – between 23:30-
00:30)
Radio (once in the evening – Thursday through Saturday between 17:00-
19:00)
Operational Plan
Festival Express will be improving its customers’ ride to the festival by providing a convenient and
enjoyable, fun-filled alternative to driving and experiencing other locations along the route.
Customers will be able to enjoy their experience with us as there is more value in traveling together
and getting to see picturesque and beautiful locations along the way to the festival thus making their
experience more memorable. With regards to the operation plan we have decided to have the
following operations in place for the 3 years that we intend to start our services from. The plans are
as follows:
On-going Operational Plan
First Year:
o Initially we would need to acquire licenses for operating our own buses on the
mentioned routes, registering company, providing refreshments at the festival
venue.
o Purchase of computer systems, telephone, print-scan-copy-fax machine
o Creation of website (Outsource) and negotiating prices with payment gateways
for online payments
o Hiring of staff for social media and IT services (Website maintenance)
o Targeting customers through social media/websites for first few months
o Purchase of a used mini-bus (20-seater) & Caravan for refreshments at the
venue.
o On basis of bookings, rental buses on hire (104 trips from 5 locations for 30 & 55
seater buses)
o Building key partnerships with event organizers and bus charter companies
o Printing of brochures, leaflets, banners and service-tags for promotional
activities
o Purchase of bag locking tags for the protection of customer’s baggage
o Acquiring parking rights for pickup services from convenient locations (near bus
& railway stations)
Second Year:
o Increased promotions online and on-site (printing of required materials)
o Agreements and networks for chartering more buses for increased trips based
on the target customers
o Hiring additional staff for sales promotion, office administration work, drivers
for our own mini-bus
o Increased shuttle services and excursions from dedicated pick-up spots
Third Year:
o Increased promotions online and on-site (printing of required materials)
o Purchase of bus (80 seater) & mini-bus + solar panel fittings on roof-top
o Hiring of more staff (Drivers) for the additional buses
o Hiring employees to handle day-to-day administration and social media activities
18. o Increasing our shuttle and excursion services to more locations
o Establishing networks with more event organizers to expand our services to
their event
o Rental of office space – Bremen
o Rental of warehouse parking for additional vehicles - atRosenheim as it will be
closer to the venue and lesser charges compared to parking in a big city
o Pickup services from convenient locations (bus & railway stations)
Geographic Location selected
The geographic locations selected for our services include: Munich, Salzburg, Rosenheim,
Trostberg, Wasserberg Am Inn and the service time table which will begin a day before the
festival venue opens its gates for camping is as follows:
Destination – Munich – Shuttle Timings
Hbf 07:00
Hbf 09:00
Hbf 11:00
Hbf 13:00
Hbf 15:00
Hbf 17:00
Destination – Munich – Excursion Timings
Hbf 08:00
Hbf 12:00
Destination – Salzberg – Excursion Timings
Hbf 08:00
Hbf 11:00
Hbf 14:00
Destination – Rosenheim – Shuttle Timings
Hbf 08:00
Hbf 09:30
Hbf 11:00
Hbf 12:30
Hbf 14:00
Hbf 15:30
Hbf 17:00
Destination – Trostberg – Shuttle Timings
Hbf 08:00
Destination – Salzburg – Shuttle Timings
Hbf 08:00
Hbf 09:30
Hbf 11:00
Hbf 12:30
Hbf 14:00
Hbf 15:30
Hbf 17:00
19. Hbf 09:30
Hbf 11:00
Hbf 12:30
Hbf 14:00
Hbf 15:30
Hbf 17:00
The return of our shuttle services will commence on the last day of the festival from 10:00
a.m. onwards with an interval of 90 minutes to our designated locations (5 locations). For
our customers waiting for excursions after the festival, the choice of receiving discounted
tickets for the next summer festival will commence a day after the festival is over due to the
clean-up initiative for the organizers. All data for pick-up and drop will be taken at the time
of booking the ticket to avoid confusion and streamline our services with precision.
However, in terms of urgent and/or special requests, additional steps would be taken to
accommodate our customers if it seems feasible.
Facilities and Improvements
There would be certain facilities provided on-board the Festival Express bus. They are as
follows:
Provision of Tea/coffee and refreshments for in-bus services
Hiring of staff for sales & marketing, administration & website maintenance
Discounted refreshments to customers wearing our service tags at the
caravan service situated inside the venue
Bag tags for luggage kept in the baggage section of our buses
Sales and Rentals for festival props that customers can use in the festival.
The rentals would be on initial deposit basis and refunded back upon receipt
of the same. In case of any damage done on the prop, subsequent charges
would be taken.
We would also be implementing and rectifying our services based on the
feedback we receive from our customers through our on-board services as
well as online reviews. Subsequent changes would be made to our services.
The feedback taken through our on-board services would be collected and
the data would be uploaded on our website (in .csv [comma separated
values] format) through freelancer or students looking for temporary jobs in
universities.
Destination – Wasserberg – Shuttle Timings
Hbf 08:00
Hbf 09:30
Hbf 11:00
Hbf 12:30
Hbf 14:00
Hbf 15:30
Hbf 17:00
20. Development Plan
The development plan for our business will be followed through a development strategy mentioned
below:
Development Strategy
The strategies are going to take place in sequential order:
Firstly, our company needs to be registered and the location selected would be
Bremen due to known locations.
Acquiring Licenses (Tour Operator, Competition for Commercial License, etc.)
For the start of our services, an additional financing would be required in the form of
abank loan of € 50000
Website development (outsource) along with testing would take close to 2 months
and simultaneously the brochures, flyers, leaflets and banners would be sent for
printing
Purchase of mini-bus & caravan
Hiring of 3 employees for social media, administration and website maintenance
would be made and for remaining sales and promotional activities, freelancers or
students would be required for part-time jobs
Arrangement for charter buses would need to be made (30 & 55 seater) on the basis
of pre-bookings made through the website
Additional staff would be hired for more promotions 3 months prior to festival date.
After first year sales, efforts for the second year would begin immediately which
would require more staff hiring and establishing contracts with charter companies.
In the third year of operations, with the assistance of additional bank loans, more
buses would be purchased, parking facilities at Rosenheim would be secured and
more promotional efforts would be made to ensure more visibility amongst our
customers. Also each year, a follow-up would be made on each customer to gather
their attention and encourage them to promote our services through word-of-
mouth.
Critical Risks
Competitor Action
With the commencement of our business, it is evident that our competitors could take
additional steps to take our customer base.
Shuttle services might be increased by our competitors
21. A lot of better on-board services could be included by our competitors
Reduced & discounted package fares could be provided by our competitors
Excursions might be included in their packages if they see increased growth in this
demand that Festival Express supplied
Increased promotions to our existing customers
Rescue Plan
To counteract the measures taken by our competitors there are a few steps we can take to
avoid losing our customers to the competitors. They can be categorized as:
Improving our customer base by following up with them regularly and informing
them the steps taken to rectify our services on the basis of their feedbacks and
requests.
Inform them about the additional value for excursions accompanied with attending
the festival
Increased Lottery winners + Festival props gifting
Providing on-time shuttle services
Increasing our promotional activities amongst our target customers
Provision of more discounts on tea & refreshments
Building increased & exclusive partnerships with festival organizers and bus charter
companies
Building better networks with the suppliers of our excursion destinations to
provided exclusive services to our customers and in-turn also benefit the rural
suppliers
Exit Strategy
To mitigate further risks we need to have an exit strategy in place. It is as follows:
Establish Contract agreements for everything taking place with our business; from
employee hiring to maintaining relationships with all the suppliers and event
organizers.
In case of conflicts arising in the functioning or decision-making process, we need to
involve the services of an external specialized mediator to resolve the same.
We need to constantly improve our services to our customers by taking note of their
feedbacks at the same time we need to constantly monitor our competitor’s
strategies and methods used.
22. We need to regularly monitor our financial records to check if we are on track with
regards to our assumptions and strategies and if they are showing the desired
results as expected.
In case of the lean months, proper utilization of fixed assets in other sectors where
costs can be recovered instead of keeping them idle
Offering (Funding Request)
First year
o 100,000 Euro required to start Express Festival
o Half is self-funded and rest is loan from Bank
o 27,000 Euro is paid at the end of year to Bank as interest plus principle
amount
o Rental Coach fares Euro 665/= of thirty setter buses – one way
Second Year
o No loan required
o An amount of 26643.75 Euro is paid to Bank as interest plus principle
amount
o Rental Coach fares Euro 668/= of thirty setter buses – one way
Third Year
o An amount of 50,000 Euro required for loan from Bank
o An amount of 27,000 is paid at the end of year to Bank as interest and
principle amount
o Rental Coach fares Euro 671/= of thirty setter buses – one way
Financial Plan
Financial Summary
Year 1 Year 2 Year 3
Revenue 114780 162300 238200
Gross Profit 57420 83621 178976
EBIT -6180 8990.625 65523.1
Net Earning 0 10010.66 65523.1
Cash 33620 14986.91 41960.01
Total Equity 23750 0 50000
Total Debt
Growth/Flow
Revenue Growth Rate 70.72% 68.14%
Net Earning Growth Rate 140% 68.13602015
Financial Statement Assumptions
23. Sales Assumptions:
- Operating at 100% capacity of our market share during the summer months.
Bus Rental Service
Rental services meet our requirements and agree to use their buses for Festival
Express
Financial Assumptions
We will raise the Euro 50,000 necessary to start our business through family and
friends.
Bank will agree to give us loan of Euro 50,000
Costing
o Euro 750/ 10 hours for drivers
o Fueling in our buses – Euro 1140
Key Financial Model Assumptions
Destination Number of Trips
Shuttle
Services
Number of seats in
buses
Excursion
Services
Number of seats
in buses
Munich 20 30 3 55
Salzburg 21 30 2 55
Trostberg 3 30
Rosenheim 5 30
Wasserberg 3 30
Year 2
Destination Number of Trips
Shuttle
Services
Number of seats in
buses
Excursion
Services
Number of seats
in buses
Munich 34 5 3 55
Salzburg 27 3 2 55
Trostberg 5
Rosenheim 4
Wasserberg 3
Year 3
Destination Number of Trips (Rental Buses)
Shuttle
Services
Number of seats in
buses
Excursion
Services
Number of seats
in buses
Munich 29 5 0
Salzburg 25 3 0
Trostberg 1
Rosenheim 7
Wasserberg 7
24. Year 3
Destination Number of Trips (Own Buses)
Shuttle
Services
Number of seats in
buses
Excursion
Services
Number of seats
in buses
Munich 0 4 80
Salzburg 0 10 18
Key Risks :
Failed to contract with Organizers
False assumptions
Lack from Employees ( wrong recruitment )
Market strategies won’t work
Projected Income Statement
Year 1 Year 2 Year 3
Revenue
Sales 111780 157300 231200
Other Income 3000 5000 7000
Total Revenue 114780 162300 238200
(Cost of Revenue)
Photocopies -500 -600 -900
Bus rental for shuttle service only
Munich - Chiemsee -26600 -45424 -19459
Salzburg - Chiemsee -20000 -17010 -16075
Trostber - Chiemsee -1200 -1015 -206
Rehensehei - Chiemsee -3000 -1212 -2142
Waser burg - Chiemsee -1800 -1818 -2142
Bus rental for excursion
Munich - Chiemsee -3260 -9000 -13200
Salzburg - Chiemsee -1000 -2600 -4200
Gross Profit 57420 83621 179876
Utilities -2000 -3000 -5000
Administration -6000 -6000 -8000
Sales & Marketing
Sales Person -2300 -3000 -6000
Marketing -2000 -3000 -6000
Parking -600 -600 -2000
Salary and wages -18000 -25000 -28000
25. Projected Cash Flow Statement
Year 1 Year2 Year3
Operating Activities
Net Earnings/Profits -6180 8990.663 65523.1
Depreciation 1500 2800 3200
Net Cash by Cash flow -4680 11790.66 68723.1
Investing Activities
Bus -7500 -60000
Furniture -2000 -1000 -500
Computers -800 -1000 -500
Tea Machines -200 -100 -100
Caravon -25000
Warerhouse Parking
Office Equipments -4000 -2000 -3000
Telephone -400 -200 -200
Stalls -500 -500 -1000
Self-funding 50000
Incoming Bank Cash 50000 50000
Total investing Activities -45080 6990.663 53423.1
Loan Payout -27000 -26643.8 -27000
Cash at the Beginning of Year 100000 27920 8266.913
Cash at the end of Year 100000 27920 8266.913 34690.01
Projected Balance Sheet
Fuel -1140
Drivers -2250
Rent Paid -10000
Interest Paid (1.5%)+ Principle amount -27000 -26643.75 -27000
Depreciation & Amortization -1500 -2800 -3200
Legal Support Fees -1200 -1200
Other expenses -3000 -3000 -3000
Earning Before Interest & Tax -6180 10577.25 77086
0.15 0.15
0 1586.5875 11562.9
Net Profit -6180 8990.6625 65523.1
Percentages -10.76% 10.75% 36.43%
27. Drivers
Interest Paid + Principle amount
Depreciation & Amortization
Legal Support Fees
Other expenses
Total
Cost 86300 30750 54690
Our break even analysis shows that
· In first year we would have break even at 86300
· In second year we would have break even at 30750
· In third year we would have break even at 54690
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