Establishing an American-style Motel in Shanghai

This research presents a business proposal for the establishment of a American-style motel venture in Shanghai, People's Republic of China (PRC). The elements of this proposal are (1) an executive summary, (2) a country feasibility summary, (3) business description and justification, (4) major assumptions, (5) capital requirements and projections, (6) financial strategy and earnings projections, (7) business organizational form, relevant tax laws, and relevant commercial law, (8) proposed management and organization plan, and (9) marketing strategy and implications.

The establishment of a American-style hotel in Shanghai is proposed. The venture would be jointly owned by American and Chinese investors. Capital for the project would be generated outside of the PRC. Initial capital requirements approximate US$25 million. The long profit potential of the venture is strong, and implementation of the business proposal is recommended.

The PRC is in an era of economic transition and diversification. The environment provides impetus for the exploration of new avenues to economic prosperity and stability. The travel and tourism industry holds great potential for the PRC in this context; however, the economic promise of this industry could be derailed by ineffective responses within the industry to economic change. The entrepreneur investors for the proposed venture, however, has experience in such environments.

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reme cases, a flight may be canceled, if ticket sales provide an unacceptable yield management outcome. The hotel industry does not have this option. Most certainly, yield management is a tactic that may enhance to a significant degree airline revenues and profits (Conference report, 1990, pp. 14-15). At the same time, however, the practice often results in the unfair and inequitable treatment of ticketed passengers in the airline industry and to booked guests in the accommodations industry. For the accommodations industry as a whole, a major problem to be solved is the stimulation of the use of unused capacity. This factor was a major consideration in the decision by the industry to adopt the yield management concept. While this problem is more serious for the marginal operator, it is an issue of concern to all operators. The development of a marketing strategy to stimulate the use of unused capacity in the accommodations industry was crucial, and, thus far, yield management has been the answer. The use of yield management in the accommodations industry is in its infancy (Hanks, 1992, pp. 15-23). Nevertheless, most hotel managements are enthusiastic about the potential of the new concept for improving both occupancy ra

Category: Business - E