The Sales and Marketing Manager has an idea of creating monthly memberships for external visitors that he would like to explore further.
TASK 2
The Sales and Marketing Manager has an idea of creating monthly memberships for external visitors that he would like to explore further. He is thinking to create two types of membership options. A Basic Membership which would include access to the gym, sauna and pool and it would cost clients $40 a week. A Full Package Membership would additionally to the access include a one hour weekly session with the in house personal trainer and a dietician consultation once a month. Clients would pay $81 per week for this type of membership.
He believes that an initial investment into promoting the centre would be $35,350 and subsequent cost of continuous promotion would be $808 a month. At the beginning he would like to make the service more exclusive and cap the membership to 20 basic membership clients and 30 full package membership clients. He wants to create a feeling of exclusivity amongst the clients.
Based on his calculations he believes offering the membership to the external clients would generate total revenue of $137,360 in the first year increasing by 10% every year after that. The in-house trainer is expected to cost the hotel $5555 a month and the services of dietician additional $1515 and both are expected to increase by 3% each year.
REQUIRED
Calculate the net present value of the external membership project over the next 3 years period. Use yearly basis for your calculations. The estimated cost of capital for the hotel is 8%. Assume 30% company tax in Australia when determining the values of the after tax net cash flow for each year.
Based on your analysis would you recommend accepting the project and offer the membership to the external clients? Explain the basis for your recommendation.
TASK 3
Once the Crystal Hotel Wellness Centre is ready for opening, it will need to be promoted to existing and potential new clients. There is already an opening event (luncheon) planned which is handled by the Functions and Events Department. The overall budget for promoting the opening of the centre is $35,350. The opening luncheon is budgeted to cost $20,200.
Your team has been appointed to plan additional promotional activities for the remaining $15,150. The budget is aimed for the promotion of the opening of the centre only.
Continuous promotional activities as well as online advertising will be handled separately.
Initial research has been done by the marketing team and the promotional activities to be considered are listed in the Appendix 3. Negotiated pricing has been included as well.
REQUIRED
Your task is to choose suitable promotional activities from the list provided to you and create a promotional budget for the Crystal Hotel Wellness Centre opening. Use the budget template provided in the excel file and adjust it as appropriate. Use Excel formulas to calculate your values. The final budget is to be included in the business report as well.
The Sales and Marketing Manager has an idea of creating monthly memberships for external visitors that he would like to explore further. He is thinking to create two types of membership options. A Basic Membership which would include access to the gym, sauna and pool and it would cost clients $40 a week. A Full Package Membership would additionally to the access include a one hour weekly session with the in house personal trainer and a dietician consultation once a month. Clients would pay $81 per week for this type of membership.
He believes that an initial investment into promoting the centre would be $35,350 and subsequent cost of continuous promotion would be $808 a month. At the beginning he would like to make the service more exclusive and cap the membership to 20 basic membership clients and 30 full package membership clients. He wants to create a feeling of exclusivity amongst the clients.
Based on his calculations he believes offering the membership to the external clients would generate total revenue of $137,360 in the first year increasing by 10% every year after that. The in-house trainer is expected to cost the hotel $5555 a month and the services of dietician additional $1515 and both are expected to increase by 3% each year.
REQUIRED
Calculate the net present value of the external membership project over the next 3 years period. Use yearly basis for your calculations. The estimated cost of capital for the hotel is 8%. Assume 30% company tax in Australia when determining the values of the after tax net cash flow for each year.
Based on your analysis would you recommend accepting the project and offer the membership to the external clients? Explain the basis for your recommendation.
TASK 3
Once the Crystal Hotel Wellness Centre is ready for opening, it will need to be promoted to existing and potential new clients. There is already an opening event (luncheon) planned which is handled by the Functions and Events Department. The overall budget for promoting the opening of the centre is $35,350. The opening luncheon is budgeted to cost $20,200.
Your team has been appointed to plan additional promotional activities for the remaining $15,150. The budget is aimed for the promotion of the opening of the centre only.
Continuous promotional activities as well as online advertising will be handled separately.
Initial research has been done by the marketing team and the promotional activities to be considered are listed in the Appendix 3. Negotiated pricing has been included as well.
REQUIRED
Your task is to choose suitable promotional activities from the list provided to you and create a promotional budget for the Crystal Hotel Wellness Centre opening. Use the budget template provided in the excel file and adjust it as appropriate. Use Excel formulas to calculate your values. The final budget is to be included in the business report as well.
- Assignment status: Resolved by our Writing Team
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