EDited LODGE-22
EDited LODGE-22
EDited LODGE-22
Mob:
09…………
Table of Content
1. SUMMARY AND RECOMENDATIONS .................................................................................................... 1
1.1. Description of the Project ............................................................................................................. 4
1.2. Brief history of the Promoter ........................................................................................................ 4
1.3. Objectives of the project............................................................................................................... 5
1.4. Rationale of the project ................................................................................................................ 6
1.5. Planned Financial Investment and Expected Returns ................................................................... 6
1.6. Implementation Period ................................................................................................................. 7
2. POLICY ENVIROMENT AND SECTOR ANALYSIS...................................................................................... 7
2.1. Government Policy and Hospitality Sector ................................................................................... 7
2.2. Key Success and Risk factors ......................................................................................................... 9
3. MARKET STUDY ................................................................................................................................... 11
3.1. Recent Trends of Tourist Inflow in Ethiopia ................................................................................ 11
3.2. Demand for Room Services at Bahir Dar..................................................................................... 12
3.3. Supply Considerations................................................................................................................. 14
3.4. Marketing Strategy ..................................................................................................................... 15
3.5. Pricing.......................................................................................................................................... 16
4. SWOT ANALYSIS .................................................................................................................................. 16
5. TECHNICAL STUDY ............................................................................................................................... 17
5.1. Location....................................................................................................................................... 17
5.2. Land Ownership .......................................................................................................................... 18
5.3. Resort Structure .......................................................................................................................... 19
6. MANAGEMENT AND ORGANIZATION ................................................................................................. 25
8. ENVIROMENAL IMPACT ASSESSMENT .................................................................................................... 31
7. FINANCIAL ANALYSIS ........................................................................................................................... 32
7.1. Summary of Investment Cost...................................................................................................... 32
8. CONCLUSION AND RECOMMENDATION............................................................................................. 35
9. ANNEXS ............................................................................................................................................... 36
This is a project feasibility study on a stop rated Resort project proposed to be established
in the capital of Amhara National Regional State, Regional State, at Bahir Dar City being
implemented by Mr.……... It envisages the overall feasibility and viability of star rated
Resort project at Baba Dar city Ethiopia near Lake Tana.
The promoter, Mr. ……………. who hails from ............. is experienced and energetic business
man. He has about …..years of work & business experience, managing his private
businesses. He has been living in …… for …. Years and managed to successfully own private
business in that country. He has invested and owned many properties in the country he
lives. With that experience, he started to invest in Ethiopia property market and
discovered the favorable investment conditions that encouraged him to migrate his
accumulated capital worth more than Birr 150 million. Currently, he wants to do more in
Ethiopia and decided to permanently move back to home. To realize same, he established
a share company called .............. PLC in 2015.
Overall, the project promoter has an in working in managing his own private business
both at home and abroad. He has the necessary experience and qualification to execute
and implement project initiatives.
Assessing potential for standard resort services in bahirdar city, the promoter derided to
establish a resort project having a capacity of 30 rooms on total land premises of 4000m2.
To realize some, prefeasibility assessments and other legal requirements has been done
and the promoter in under process to obtain the essential land.
The technical feasibility of the project which includes the suitability of the area, the
construction work, furniture, equipment and other facilities has also been done in detail as
presented in the technical Ninth' part of this feasibility. The intended project is located in
the capital of the regional state at Bahir Dar city in the shorelines of Lake Tana around
Debremariam Monastery area. The proposed resort project is situated on ideal location
accessible for all type of customers as it is on the center of the city and in the highway
front Bahir Dar to Gondar near the main asphalt road. Additionally, all the infrastructure
and utilities like transport, power, water and communications are available for the project.
Most of all, the city is one of the naturally blessed cities of Ethiopia that highly enjoy
frequent tourist inflow and manpower can be mobilized from the city. All the assessments
made with this regard depicted the project's technical usability and feasibility. The civil
work constructions and procurement of resort equipment’s and machineries will also be
made giving priority for quality in conformity with the standard for star rated resort
project.
The market for hotel and room services has been assessed based on the government
strategies for the sector, high inflow of investments to the regional state, and capacity of
existing standard homes in the city. In all protection years, the project demand is
projected to exceed the project, supply with a wider and increasing gap. The reasons for
this growth is the prospective growth in tourist inflow to the regional state, international
and national meeting, frequent conferences as it is regional capital, tourist arrival because
of the regional heritages, Lake Tana and other cultural sites. The target groups of
proposed resort are local and foreign nationals who come to City for business, local
citizens come to the city for assembly and conferences, tourists who arrives for leisure and
other purposes, local customers arrives for leisure and other purposes, citizens who are
living in the city and also diasporas. Providing quality services with reasonable price,
Strategy to accommodate all level of customers by consistently improving with the
changing situations would be the promoter's objective.
Well planned and effective organization is vital for the success of service delivery projects.
The project will be implemented by a well-organized management staff. The promoter has
a vision to render quality and standardized resort service for both local and foreign
customers. The General Manager of the project, Mr……………… will have a key role in
overall leadership and strategic planning and designing the overall operation of the
project. There will also be a qualified and experienced Resort Manager for running the day
to day operation of the proposed Resort. The management aspect of the project is
considered and found to be dependable considering the vast experience of the owner-
General Manager.
Financially, the project is estimated to cost a total of Birr 79,681, 793 of which Birr
64,641,420 (81%) is earmarked to finance fixed assets and Birr 15,040,373 (19%) for
preproduction costs and satisfy the working capital requirement of the project. The fund
for the establishment of the profeet is planned to come from equity sources of Birr
35,377,886.02(44%) and the remaining Birr 44,303,907.01 (56%) is Bank loan.
The income projection reveals that the project will generate an average net profit of Birr
11.3 million/annum over the 10 years project life time. The profit margin begins with Birr
6.8 million in the first year which increases to Birr 15.5 million in the 10th year of
operation. The cash flow forecast also portrays that the project generates sufficient cash in
its operation servicing its obligations with cumulative cash balance of Birr 4.3 million in
the first year which surges to Birr 80.8 million at the 10th year. The financial internal rate
of return calculated shows that, the project will have before and after tax of 26% and 20%;
respectively. The NPV at 12% discount is Birr 59.5 million which reveals the project's
positive investment return. Sensitivity test is also carried out to test how the project is
sensitive to adverse effects. All financial results reveal the project's financial soundness.
Above and beyond to all positive financial outcomes, the project will create permanent
employment opportunity for more than 200 people besides a number of daily laborers will
be encompassed during the project's implementation. The establishment of the project
will also contribute its part to the development of the community and surrounding
farmers through experience and knowledge transfer of agro tourism like better
harvesting, vegetation, beekeeping and other modern agro business along with
improvement of the country's and the regions hospitality sector. It also increases the
government's treasure generating an average of Birr 6.1 million in the form tax over the
project's life.
Assessing the overall financial results, economic and social benefits, and the feasibility of
the planned project can be placed beyond any doubt and timely implementation of the
resort project is recommended. In this respect, the necessary support shall be availed by
all the concerned organs.
The project is a star rated lodge resort project with 30 soundproofed rooms providing free
WiFi and free wired Internet, and fully furnished beds. Guests can enjoy deep full room
service and other standard amenities include 24-hour room service, refrigerators, and
LCD TVs. A full-service Cafeteria, restaurants, bars, golf course, horse ride, children play
grounds, spa and a health club will be available at this resort. Free WiFi and free self-
parking are also provided. Additionally, 2 restaurants, 1 bar/lounge, 2 coffee shops/cafés,
business center. mini market and on door services will be onsite.
The construction of the G+1 main resort building will be made on a total land holding of
1722m² and built up area of 400m². The land is expected to be obtained on investment
bases from Bahir Dar city Administration Office. The resort civil works along with the
machineries and equipment’s to be procured with total worth Birr 64,641,420.20.
Working capital requirement is estimated at Birr 10,388,465 while pre-production Costs
are estimated at Birr 4,302,263. The total loan tenure is planned to be 2555 days or 7 ears
excluding 12 months implementation period.
Ato ………………… is an experienced and energetic business man. He hails from ..................... in
nearby where the proposed project is located. He has Diploma in ................................ at
……………….Collage of education. Ato ……………. has overall work experience of more than
…... years in running his own company. The past business experience he had and natural
talent of entrepreneurship did lead him to a great success. As a General Manger, he is
successfully managing and handling the business activities by creating an environment
which is attractive and conducive for both clients and workers, dealing with his suppliers
for the proper flow of supply, checking customer feedback for better client satisfaction and
business development, over all control on quality of stock purchased and balance of their
book keeping. With that experience, he started to invest in Ethiopia property market and
discovered the favorable investment conditions that encouraged him to migrate his
accumulated capital more than Birr 150 million.
The objective of the project is to establish and execute star rated lodge resort project on
total land holding of 4000m2 in the shorelines of Lake Tana around Debremariam
Monastery of bahirdar city, the capital of Amhara National Regional State. The promoter
has an intention to execute full-fledged resort project having room services, restaurant,
bar, bakery, swimming pool. Health and spa center, cultural and traditional house, golf
course, horse ride, fishing pond, children play ground. Camping site, business center, mini
market and agribusiness undertakings intended for both Ethiopian and foreign customers.
The specific objectives of the project being to:-
Implement and execute standard Lodge Resort undertaking in Lake Tana shoreline,
Build fancy resort for vacation or business trip or to break from busy life or enjoy
with organic vegetable and fruits and honey supplies with multiple facilities
ecotourism splendid view of mixed agriculture and horticulture campout scenic
drive m beach.
Generate reasonable profit rendering quality and standardize resort services both
for local and foreign customers.
Contribute its part to improve the lively hood and harvesting practice of the
farmers through partnership experience sharing and provision of better
horticulture seeds.
Contribute its part for tourism development of the country especially Bahir Dar city
by providing Tourist standard resort Services.
Provision of standard hotel and other entertainment services for the local
communities with affordable options
Tourism is one of the sectors that Ethiopia is the potential to invest and reward from it
given the country is endowed with many tourist attractions. Many have been said and
written about the tourism potential of the country and the very relation of the hospitality
sector which is undeveloped yet. The highlands of Ethiopia have an attractive landscape,
scenery and wildlife. The low lands of the Great Rift Valley have also a wide variety of
wildlife and several bird species which are the routes for tourists in Ethiopia. The tourist
inflow in the country has been showing an increasing trend for the last five years following
the stability, promotions and better developments in tourism infrastructures in the
country.
The Amhara Regional State is one of the regions holding many attraction sites for both
local and foreign visitors. The region is endowed with natural and culture heritages. It has
diversified agro ecology, infrastructure facilities. increasing flow of investment. This and
the very availability of market and future prospect for growth in hospitality sector are the
basic factors for the project's establishment. The agro-ecological conditions of the area are
found to be suitable for the envisaged resort project. The climate, temperature, soil
properties, quality and availability of water as well as the landscape of Bahir Dar city and
infrastructural facilities are also found to be appropriate. Additionally, high development
priority is given to Bahir Dar City by regional government given the natural blessings and
being the capital city of the regional state. The intended star rated resort project initiative
is also adhered to the above indicated rationale.
The investment outlay and expected returns for the planned hotel project is presented
with the tables:
Proper and timely implementation of a project is vital for its ultimate success. The
promoter has planned to execute the resort project within one year assuming that long
term loan for partial financing of the civil work constructions, procurement of essential
resort equipment’s and working capital will be obtained from Banks in Ethiopia.
The Government of Ethiopia (GOE) has set in train an initiative to develop the tourism
sector. The recent establishment of three institutions, the tourm council, tourism board
and tourism agency, have raised the hopes of tour operators that it will address the
problems they face and allow the sector to flourish.
The GOE has already begun formulating a policy and strategy for the tourism sector and
many of the ideas are already bulleted in the PASDEP and the recent GTP. Some of the
planed interventions include:
Upgrading the general quality of hotel management and service standards, this will
require more understanding of what is required by international tourists, best
achieved through demonstration from foreign investors, as well as improved
quality controls;
Encouraging increased contacts of domestic tour operators with foreign operators,
and supporting foreign participation on equitable terms:
Broadening the tourism product, and supporting the expansion of tours into new
locations and activities;
• Opening up new regions, for example, mountains, desert regions, with due regard
for environmental and sustainability factors;
Developing natural parks into tourist destinations with private sector partners,
strengthening local supporting industries and increasing the quality of product.
Develop the design of handicrafts, create codes of conduct for guides and improved
licensing systems, providing training,
Promoting special initiatives to promote entrepreneurs in less well-developed
areas and encouraging use of local supplies in hotels,
Tourist destination development, including physical planning for the areas around
attractions, development of tourist facilities and information centers, and
preparation of plans for marketing and promotion of the destination;
Expansion and upgrading of the Catering and Tourism Training Institute (CTTI),
from its present capacity of 120 to 600.
All this initiatives and efforts are expected to further strengthen and boosted in the
upcoming Second Growth and Transformation plan of the Government which paves the
way for improvement of hospitality sector in the major tourist destination regions like the
Amhara National Regional State.
The government has given keen attention to the development of the hospitality
sector-Tourism Industry. The setting of the ministry office, the policy framework and
the promotion under way are all facilitating measures for the development of tourism
industry in the country.
The country has rich historical and cultural heritages as well as natural resource
Abundance which are basic ingredients for the promotion and development of
tourism in the country. The development of infrastructure and promotional work in
the future will
Decline the gap between the country's tourism potential and the level of tourist
inflow.
Character: The promoter, Mr. …………….. has more than ….. years of business
experience working in managing different lines of businesses. He works and lives
both in Ethiopia and abroad and in those years he manages to establish good social
relationship and character with the society. Moreover, he has also good
relationship with the Business community and Banks.
Capacity: The proposed rated Resort project is profitable endeavor with good
market potential. The projected financial indicators also confirm that the project
will generate reasonable profit having adequate cumulative cash balance to service
its obligations satisfying its working capital requirement.
Competence: Mr. ………….. can manage and make the lodge project competitive in
the market offering star rated and quality resort service with competitive price.
Moreover, the Resort project will be
furnished with quality materials and is in a convenient location which will
strengthen its competence.
Collateral: The G+1 Resort building and other Resort Civil works will be
constructed giving priority for quality and its marketability is al high Morcoter,
Resort equipments and Vehicles will be imported abroad so as to fulfill the
standard requirement. In this regard, the investments are adequate to the pledged
as collateral.
RISK FACTORS
Market Risk: Minimizing risk depends on the extent level of the company's
management in designing appropriate market penetration mechanism particularly in
rendering quality service, creating network with stakeholder and partners and
promoting the company's products to the wider community. In doing this, when the
management of the business found strong enough in making use of all available
possibilities, capitalizing on its strength and also working on its grey area based on
customer feedback and industry growth, it will widen its chance of grasping more
opportunity Cognizant of this, the promoter will work towards increasing the market
share of the Resort by properly and timely deliver and serve lus customers.
Management Risk: The intended Resort will be organized with qualified and
experienced staffs. The General Manager of the business, Mr ................has been working
and managing service rendering businesses for the last ……
years. In this regard; the risk associated with management is believed to be minimal.
Business Risk: The promoter can create strong service and reputation by delivering the
resort services and amenities at the right time in conformity with the customer's
demand. Given the availability of market, increase awareness and fast economic
growth, the business risk is at low level.
Financial Risk: The promoter has been running positive profits for the last consecutive
operational years. Additionally, the income and cash flow projection of the business
assures it is financially feasible and to this end the risk with regard to finance is
acceptable.
Liquidity Risk: As evidenced from the trend of operational finance and projection made,
the business will have sufficient cash to service its debts and obligations. In this regard,
the liquidity risk is acceptable.
3. MARKET STUDY
The market trend of hotel service is closely related to the performance in the overall
economy in general and the tourism sector in particular. The Ethiopian economy has
continued to grow in the previous years at faster rate of more than in which case the
contribution of the service sector, other than agriculture, has been growing significantly as
well. At present, it is a common experience to observe the surge of new investment in this
sector in every corner of the nation as the result of the induced effect from increased flow
of tourists and business travelers. The country is endowed with unique combination of
natural and cultural heritages, impressive scenery, suitable climate, rich flora and fauna
and recognized archaeological sites. Its capital, Addis Ababa is the venue and political
capital of Africa being the seat of many international organizations including the African
Union (AU), the United Nations Economic Commission for Africa (UNECA) and others.
Ethiopia is also beautifully endowed with many kinds of flora and fauna species. More
than 800 species of birds reside in Ethiopia of which 23 are endemic to the country. There
are more than 100 mammal species, of which seven of the big mammals are unique to
Ethiopia. International tourist arrival to the country has shown growth from 103,000 in
1995 to 523,000 in 2011 with the average growth rate of 11.4% in the period under
consideration. On the other hand, the total receipt from tourists arrived has increased
from 177 Million USD in 1995 to 1,998 Million USD in 2011 with an average growth rate of
17.52% in the same period. Among the total tourist inflow, the number of tourists from
Africa has the highest number which is about 37.6%, next to Africa, 25.07% of the tourists
came from Europe. The provision of infrastructure for tourism is expected to further boost
the country's attraction for tourist arrivals. Conductive opportunities being created by the
economic policy for private investment in hotels, lodges and international restaurants has
improved the availability of vital services necessary for tourists. The country has six major
entry parts, by air. Addis Ababa and Dire Dawa, by road- Moyale, Metema, Wuchale, Galafi,
Gambella and by rail way Dawale.
The feasibility study conducted for this project deals with the demand and supply analysis
for the resort project to be established in Bahir Dar city of the Amhara National Regional
state. The demand for hotels at any location is directly related with the level of
development of the economy in general and the tourism sector in particular. It is a
function of the number of both domestic and foreign tourist travelers in the area, travelers
for commercial or business purposes, travelers for conference and other assembly
purposes, residents in the area, etc. Tourist could come to the country for different
purposes. It could be of for leisure and vacation, for conference and businesses. The
tourism sector in turn largely depends on the political, economic and social stability of the
country.
To determine the Hotel demand in Bhair Dar City, local travelers for conference, travelers
for business, Foreign Tourists and local residents are taken into account. Bhair Dar city is
the capital of the Amhara National Regional State and it has the opportunity to entertain
considerable international, national and regional meetings and conferences in a year.
Bahir Dar City is one of the regional cities in Ethiopia that are registering overwhelming
growth especially in Tourism sub sector as there are huge inflows both local and foreign
tourists. These investments are highly correlated with Hotel services as these investments
hold large number of skilled and unskilled employees and entertain frequent supervision
by owners, financers and government officials. Data obtained from Bahir Dar City
Administration Culture and Tourism Office confirms that local and foreigners visiting
Bahir Dar and the surrounding have been increasing at 14% per annum. The detail tourist
inflow for the last six years is presented below:
TABLE 6: FOREIGN TOURIST INFLOW FOR THE LAST SIX YEARS ETHIOPIAN CALENDAR
All in all, there is high demand for hotel related services and the demand is expected to
boost in the time ahead because of the tourist attractions sites, lake Tana, frequent
conferences at it is regional capital, its richness in wild life, rivers and other heritages that
attract tourists and increasing per capita income. In this regard, there is high demand for
rooms, accommodations and other hotel services at Bahir Dar City.
Market assessment has been made on the existing and potential supply of services of
room, café and restaurant in the city. Existing service providers in the project area are
very limited in type of services provided. Currently, there are about 16 big hotels under
operation with a total of 894 Bed Rooms. These hotels are mainly providing room and
restaurant services except few. Some of the big name hotel and Restaurants in Bahir Dar
city are:
As can be seen from the above table, the supply of room services of all modern Hotels at
Bahir Dar city is limited to 326,310 bed nights per year despite the increasing market
demand. There are only two hotels that can be comparable with the standard of the
proposed resort project with total room facilities of 178. With the inclusion of the project
on hand the total supply of bed nights of all hotels at Bahir Dar will be 344,560 which still
invite additional future investments in the sector.
In all projection years, the projected demand is expected to exceed the project supply with
a wider and increasing gap. The reasons for this growth is the prospective growth in
tourist inflow to the Regional State because of its immense attractions, international and
national meetings, frequent conferences at it is regional capital, tourist arrival because of
the regional heritages, existence of Lake Tana and other cultural sites.
The target groups of proposed resort project are local and foreign nationals who come to
Bahir Dar for business, local citizens come to the city for assembly and conferences,
tourists who arrives for leisure and other purposes, local customers arrives for leisure and
other purposes, citizens who are living in the city and also diaspor Providing quality
services with reasonable price, Strategy to accommodate all level of customers by
consistently improving with the changing situations would be the promoter's objective.
Some of the recommended marketing strategies are:
Contacting government and private agencies affiliated with tourism on a regular basis,
informing them of any corporate rate, discount programs, availability of services, etc.
Actively marketing the hotel during implementation and operation Marketing of
safety features such as interior corridors and security locks.
Giving the kind of service that brings people back for regular treatments, and
encourages clients to recommend the hotel to friends.
Setting competitive price for the services of the Hotel in line with the facilities and
amenities
Providing organic and healthy foods
3.5. Pricing
The resorts will employee identical pricing charges for foreigners and local customers to
start with. The average price of rooms per one night will be USD 35. Competitive price set
for the proposed resort project assessing the market.
4. SWOT ANALYSIS
Strength Opportunities
……… PLC | 16
P
5. TECHNICAL STUDY
5.1. Location
Bahir Dar City is is the capital city of the Amhara national Regional State which is located
adjacent to Lake Tana. It has 17 administrative kebeles and full-fledged with basic physical
and social infrastructures. The intended project is located in the capital of the regional
state at Bahir Dar Zuria Woreda, Robit Batha, adjacent to Lake Tana about 5 km from the
main high way from Bahir Dar to Gondar
The resort is intended to be situated on ideal location accessible for all type of customers
as it is in the vicinity of the city adjacent to Lake Tana. Additionally, all the infrastructures
and utilities like transport, power, water and communications are available for the project.
Most of all, the city is one of naturally blessed cities of Ethiopia as it is surrounded by Lake
Tana and manpower can be mobilized easily from the nearby.
The project promoter has identified the project's location and in a process to request
4000m2 of land from the ANRS Bahir dar city Administration Office on lease bases
intended mainly for resort and interrelated investment establishment and undertaking.
The required land is planned to be obtained legally from the Regional Government City
Administration and it is adequate enough to undertake the planned investments.
The envisaged resort should have sufficient and comfortable space to accommodate the
core services as per the requirements of a standard rated resort. Actually this will be
considered seriously at the design stage of the civil work construction and landscape
engineering along with the allocation of appropriate area and the placement of each
component with the proposed location accordingly. On the other hand, it is also important
to figure out the layout of each component not only from the perspective of having
compliance for the standard but for the benefit exploring possibilities of bringing
complementary services under the same location and allow maximum convenience in
work processes. The sizes (area) of each service, which will be explained below, determine
the holding capacity of guests as it determines the level and quality of service. Other than
the critical factors mentioned above the market aspect. i.e. customers need and resource
availability are considered in which case they are the determinants to give the final set up
of the facilities.
a) Bed Rooms
A total of 10 rooms are allocated for room services with options to avail four different
types of accommodations. The resort will have fully furnished 5 Family Bed Rooms, 5
Executive Bed Rooms, 5 Luxury Bed Rooms and 20 Single Bed Rooms
b) Bar
Standard resorts must have a bar with a superior comfort and service quality. The
furniture and equipments, as being the basic sources of customer attractions, need to be
fashionable of higher quality commensurate with the expectation of guests who happen to
prefer this class. Therefore, the envisaged resort, having the requirements considered too,
will have three standard bars at convenient locations. The maximum carrying capacity of
each bar is estimated to be 300 persons per event.
c) Restaurant
Technically a resort with the envisaged standard must have dining places having the sizes
(area) proportional to the guests who have checked in as normally customers do not
prefer to worry about going out once they have settled. The area determination has to take
into account this. Hence, the resort must provide the maximum range of varieties at all
times. Hence, the intended resort will have three restaurants each having a capacity of
entertaining 100 guests and allow maximum efficiency in the service by having the
restaurant and breakfast rooms placed at same location. One restaurant is reserved for
traditional and cultural foods and furniture and rustic appliances
d) Assembly
Hall A resort with star needs to have a banquet hall of larger area which can be used for
banquet or conference interchangeably. The conference hall will have a capacity of serving
up to 500 people per event.
The resort will also have play ground's for children's aiming to attract customers
especially on weekends. Moreover, play ground for adults will also be prepared as
sporting facilities, Additionally, the resort will have three swimming pools I from
executive customer, 1 for adult and 1 for children.
Bakery is part of the project aiming to satisfy the day to day need of the resort and in the
future as capacity increases sales outlet will be opened at Abay-mado. Moreover, cultural
and traditional services will be offered through traditional houses and equipments.
g) Camping Site
A campsite or camping pitch is a place used for overnight stay in the outdoors. The resort
will allocate adequate space with the necessary landscape facilities for customers so as to
satisfy the customers need.
h) Kitchen
A kitchen, with the processes of multiple varieties of food preparation and a proportional
capacity to handle the maximum guests to be served in the three restaurants as well as in
banquet hall, is the critical requirement for the proposed resort project. It should be large
enough also to accommodate the working areas of cold and hot meals on the one hand and
pastries and bakery on the other. In order to allow reasonable space for workers to move
around as well as to avoid the possibility of contamination and spoilage, the healthy
pastries and bakery will be placed at the far end of the kitchen where the food section to
be placed at the nearest door joining the main buffet at the gate of the restaurant. On the
other hand, the kitchen should be provided with a space to add a small store with a
flexible structure to contain butchery and cold rooms. These are critical for easy
facilitation of cooking's.. Moreover, the kitchen will have a well connected washing corner
with at most margin of clearance to make the area safe and clean.
i) Laundry
A resort with a size of 90 bed rooms, bars, restaurants and banquet hall need a
proportional laundry facility in terms of handling the burden with proficient speed of
service and quality. The envisaged hotel has considered a laundry service that of an
automated with machines and equipment of dry and wet cleaning. Obviously the service
must remain operational for long hours ie. at least up to the time needed to cope up the
frequency of orders from guests.
j) Store
Alike the capacity projection made on the kitchen, the envisaged project requires a store
as big as the varieties of items that are needed to be kept as stock. The store will need to
have a systematic management for stocks properly placed and identified at the time of
delivery and inventory. Hence, it is the required procedure to organize the stock items in
separate sections so that the proper handling of stocks shall be maintained. In view of this,
the hotel requires a number of stores with sections for food items, beverage, glass wares,
silver wares, soft furnishings, cleaning and sanitary materials, stationary materials all
placed according to their physical appearances. The store will be placed in locations
nearer to kitchen or leisure service.
The resort must provide the service of car parking with 24 hours protection at least for
those customers who have checked in and external customers whom came for service.
Again, it should be large enough to accommodate as many vehicles as the resort is going to
entertain a large crowd. In view of this, a parking space for 50 vehicles is planned to be
allocated in the compound with the standard width and height of the drive in routes.
Additionally, there will be a space for outdoor services in line with the customers'
demand.
The civil work construction required for the project includes construction of G+ 1 storey
resort building on 400m2 built up area, Swimming Pool /Half Olympic/ Bar and
Restaurant. Bakery House, Gym and Spa Building, Cultural and traditional center, Staff
Residence Mini Market and Business Center Buildings, Hut Houses, Fishing Ponds,
Landscape Civil works for Golf course, horse ride, camping site and Play ground and other
site works. The total cost of civil work construction is estimated at Birr 45.45 million. The
detail civil work construction breakdown is tabulated with the following table:
Total 38,119,375.00
The resort requires various furniture and equipments for furnishing so as to smoothly
operate its day to day operation. The project will be equipped with quality and
standardized furniture and equipments.
Motor Vehicles
The proposed resort will have a Pick up intended for supervision and 14 Seat Minibuses for
transportation and tour services. The breakdown is presented with the table below:
Utilities
Electric and water supply will be secured from EEEPCO Bahir Dar District and Bahir Dar
Municipality Water Supply Power Generator with a capacity of 150 KVA is expected to supply
the power requirement of the project as back up when there is power interruption.
Additionally, boreholes will be drilled within the project premises in case municipality water
supply is not supplied tin time.
Implementation Schedule
The establishment of the Hotel essentially involves two stages: the establishment decision and
the establishment process. The establishment decision has been undertaken and the promoter
has started construction of the hotel building by obtaining land from the government.
Following securing finance from the Bank, construction finishing of resort buildings,
and procurement of the resort machinery and equipments, recruitment of manpower
and preparing the hotel for operation will commence. During this period, necessary
manpower will be recruited and trained. This will be followed by such activities as
procurement of office equipment and furniture. The proposed activities include:
Financial Arrangement- bank loans
Well planned and effective organization is vital for the success of star rated resort projects.
The project will be implemented by a well organized management staff. The promoter has a
vision to render quality and standardized service for both local and foreign customers. The
General Manager of the project will have a key role in overall leadership and strategically
planning and designing the overall operation of the project. He has accumulated acute
business experiences managing his private business for more than 10 years. In this respect,
the promoter has the capacity to supervise the overall management of the project at the apex
Under the General Manger, there will also be a qualified and experienced resort Manager for
running the day to day operation of the resort. Under the Resort Manager, there will be
experienced and qualified Finance & Administration, Room Service Manager, Bar and
Restaurant manager, Pool and Spa Related Services Manager and Agribusiness and Related
Services Manager. There will also be Front desk Manager, Sales and marketing Manager, ICT
Manager, conference and business center Manager Engineering and maintenance Manager
security Manager.
business environment will be implemented. This project will assume go marketing strategy
that maintains positive environment among different stakeholders. The proposed
organizational structure of the project is depicted here under.
General Manager
Cooks
Accountants
AComping
Attendants
Laundary Waitress SPA Service
Cashiers
Electrician
Store Keeper
Guards
S.No Job Titles Qualification relate field and 10 years ' experience in Staffing F n
BA In Hotel Management Management and any other
relate
Hotel operation out of which 4 years in leadership /
1 General Manager management position 1
BA in Office Management and secret anal science and 4
years experience in
1.1 Executive Assistant secretary 1
BA in Law and 2 years ' experience in legal advisory
position preferably
1.2 Legal Advisor industry . 1 ( partim
BSC in Information technology / computer science and
2 years in system development
1.3 ICT officer field . 1 ( partie )
BA in Hotel Management / Management / Economics /
Accounting from a recognized
college / university and 8 years ' experience in catering
industry out of which 2 years in
1.4 Night Manager supervisory / management position. 1
BA in Management and 8 years in Human Resource
Administration , procurement general service
in catering industry and out of which 2 years in
2 HR & Administration Manager Managerial position 1
College Diploma in office management and secretanal
science 2 years in administrative
assistance position preferably worked in hospitality
2.1 Administration Assistance industry . 1
BA In Management / Human Resource Management
and 4 years ' experience in human resource
2.2 Human Resource Section Head Management in hospitality industry . 1
BA in Management / Human Resource Management
and 2 years ' experience in human resource
2.3 Human Resources Officer Management preferably worked in hospitality industry . 2
Diploma In Management or related field and 4 years
2.4 General service officer experience in general service 1
Diploma in purchase and supply management and 2
years ' experience in purchasing preferably worked in
2.5 Purchaser hospitality industry 2
TVET 10 + 1 TVET diploma in automotive technology or
10th grade complete and 2 years experience in public
2.6 Driver transport 4
dishwasher
8.5 Manager Engineering and BSC Degree in electrical / mechanical
Electronics and 4 years ' experience in installation ,
8.6 Maintenance inspection and maintenance 1
Diploma in Audiovisual / electronics and 1 year
8.7 Audio - visual experience in audiovisual
8.8 Technician audiovisual operation 2
8.9 Engineering Craftsman
9 ( og air - conditioning
9.1 mechanic , boiler man ,
Diploma in General technician and 2 years ' experience
9.2 carpenter , electrician fitter , 3
in equipment maintenance
9.3 general mechanic ,
9.4 mason / plasterer painter ,
9.5 plumber )
10th grade complete and 1 year in similar technical
9.6 Assistance technician position. 3
BA degree in Management / Diploma in management
and certified in police / military and 8 years
9.7 Safety and security Manager for BA Degree and 12 years for Diploma 1
BA or Diploma in management and preferably who
working hospitality industry for 5 years .
9.8 Safety and security supervisor certified in police or military science and 2 18 dep
10 th grade complete or 12 th grade complete and
certified in police years ' experience or in guard
position complete and basic knowledge in computer gate
9.9 Security Guard preferably 3
Bsc degree in Aare and 4 years’ experience
10 Agronomist 2 years’ experience in 2
Total 171
……… PLC | 30
P
The WTO focuses on its advisory and technical assistance services on policies, development
guidelines, management techniques and measurement instruments that allow national, local
governments, tourism sector and other stakeholders to overcome challenges on sustainability
by employing sustainability and environmental friendly approaches in their decision making
process and day to day operational activities. The UNEP has also initiated a program that aims
at integrating environmental sustainability into decision making in the tourism industry and
into consumers' purchasing choices by disseminating technical knowhow and building business
networks to catalyze sustainability in the tourism sector. Sustainability along with
environmentally friendly approach in the hospitality sector articulates 12 aims that address
economic, social and environmental impacts. This aims are:
The Project will give special attention on environmental friendly approaches both at the time
of project implementation and operation. To this end, there will not be adverse environmental
impact on the project are because of implanting the project. The promoter will utilize the
culture diversification and norms of the community for the success of the project. Moreover,
the project will keep afforest and make green the project premises so as to balance the
atmospheric nature of the area which in turn result in soil fertility, create conducive
environment for the hotel and maintain the ecosystem in general.
The project in this regard will bring positive features of to the project area's environment
through forestation and other environmental friendly mechanisms.
7. FINANCIAL ANALYSIS
Source of Finance and Financing The total investment cost is planned to be financed from two
sources: equity and hank loan. Bank loan accounts 56% and equity 44% that is Birr
11:303.907.01 bank loan while the balance Birr 35,377,886.02 is expected to come from equity
sources.
Profitability
The projected financial statements annexed indicate that the project is profitable and liquid.
The project will generate an average net profit of Birr 11.3 million over the 10 years project life
time. The profit margin begins with Birr 6.8 million in the first year operation which increases
to Birr 15,5 million in the 10th year.
Liquidity
The cash flow forecast also portrays that the project generates surplus cumulative cash in its
operation servicing its obligations with cumulative cash balance of Birr 4.3 million in the first
year which increases to Birr 80.8 million at the 10th year of operation. The liquidity position
also permits financing of all capital replacement cost over its time from internally generated
flows without re financing.
Profitability of the investment is further tested using internal rate of return and the project
yields before tax and after tax financial internal rates of return of 26% and 20%; respectively.
The NPV at 12% discount rate is Birr 59,519.625 which reveals the positive project's
investment return.
Payback Period
The payback period is the period required to recover the initial investment outlay through the
accumulated net cash flow earned by the project's financing. investing and operating activities.
The pay-back period of the fixed assets of the envisaged project is estimated to be around 7
years. This implies that the initial investment will be recovered in nearly in its sixth years of
operation.
Sensitivity Analysis
Sensitivity test is also carried out to test how the project is sensitive to adverse effects revenue
decrease, operating cost and investment cost increase. To this end, a 10 % reduction in sales
yields an after tax IRR of 12%, whereas a 10% increase in operating cost and investment cost
results an after tax IRR of 15% and 18%, respectively. This reveals that the project can
accommodate any likely external shocks being slightly sensitive to decrease in revenue. These
results reveal the financial soundness of the project
9. ANNEXS