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.
The estimated population of the People's Republic of China in 1991 approximated 1,110,000,000 (Hunter, 1994, pp. 355-357). The country's population target for 2000 is 1,270,000,000. In the 1990s, 75.1 percent of China's population resides in rural areas, 24.9 percent in urban areas. Thus, the typical Chinese would be described as a rural dweller. In must be remembered, however, that the urban/rural distribution of the population is changing relatively rapidly. Fifteen years ago, almost 85 percent of the Chinese resi...