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Business Plan for Mobile Application Hotel One

Applied Communication
(E15/COMB2009/03)

Business Plan for the Mobile


Application Hotel One

Team members: Koh Leong Chian


Ang Chiu Yang

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

TABLE OF CONTENTS
1

Executive Summary............................................................................................. 3
1.1

Issue.............................................................................................................. 3

1.2

Solution.......................................................................................................... 3

Product................................................................................................................. 4
2.1

Introduction and Product Overview................................................................4

2.2

Development Requirements..........................................................................5

2.3

Competitor Analysis....................................................................................... 6

Market Analysis.................................................................................................. 10
3.1

Market and Customer Group........................................................................10

3.2

SWOT Analysis............................................................................................. 12

Marketing Strategy and Implementation Summary............................................13


4.1

Marketing Strategy...................................................................................... 13

4.2

Sales Strategy.............................................................................................. 13

Company Description......................................................................................... 14
5.1

Company Summary..................................................................................... 14

5.2

Mission......................................................................................................... 14

5.3

Key to Success............................................................................................. 14

5.4

Company Financial....................................................................................... 15

Personnel Summary........................................................................................... 16
6.1

Personnel Plan............................................................................................. 16

6.2

Projected Cash Flow (Year 1)........................................................................16

Conclusion.......................................................................................................... 17

Sources.............................................................................................................. 18

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

1 EXECUTIVE SUMMARY
1.1 ISSUE
Singapores tourism industry has been seeing steady increases of international
visitors over the years; the increase in visitors are a welcome relieve for the
Singapore Tourism Board (STB) despite the overall downward trend of the global
economy and weak regional currency vis--vis Singapore dollar. STB is optimistic
that the projected forecast visitor will reach 15.7 million by the end of the year.
With this increase in visitors; the hotel industry performance is expected improve,
however this is not the case. The room night sold vs. room night available gap has
increased, resulting in the decrease in room occupancy rate. The most notable
contributing factor for the decrease is due to the increase of hotel room supply. In
second half of 2015 and first half of 2016 saw a spike in many mid to high end hotel
openings, resulting in an increase of room night available.

1.2 SOLUTION
We at Business IT Pte. Ltd would like to create a mobile application to provide user
with the most latest and complete information for booking a hotel room
instantaneously.

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

2 PRODUCT
2.1 INTRODUCTION

AND

PRODUCT OVERVIEW

Technology Innovation is one of the primary strategy at Business IT Pte. Ltd, we had
the idea to create a mobile application which provides a channel for anyone and
everyone who is planning a trip or vacation to search and book a stay of their
choosing. We understand that the market segment within mobile application is still
developing and there is a great potential for growth in this market. We realized that
there is already similar mobile application available in the market as it is; we believe
that much of these mobile application has short comings and limited services
provided. So we decided to create an App to fill this hole in the market: hence Hotel
One was born.
Hotel One is a mobile application which allows the user to access the live
information of available hotel/motel vacancy within the default 1km radius of
selected location. Other features include in the App are:

Accessibility of the hotel (i.e. directions to hotel/transport provided)


Hotel Facility available (i.e. Gym, Swimming pool, Bar/Restaurant, Spa, Wi-Fi

access)
Any disability access facility within the hotel
Children or infant facility within the hotel
Point of interest around the selected stay location
Travel Emergency Contacts (i.e. local embassy address and contact number)
In-house medical service within hotel (i.e. on call doctor or nurse)

Fig 1 Hotel One App Logo.

Available in two platforms: IOS and Android

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

2.2 DEVELOPMENT REQUIREMENTS


We need to decide on which platform will the application be developed on, as there
are two types of application: mobile version and the web based version. Both have
its own advantages and also its disadvantages, below are a comparison chart.

Applicati

Mobile Version
Requires User to acquire this app

Web Based version


Also referred as Internet-enabled

on Access

by download and install on

apps that can be accessed

certain mobile device through

through the device web browser

Apple IOS The APP Store or

and no download and install is

User

Android Apps Google Play.


Standard User interface for both

required.
Standard User interface for both

interface
Develop

Mobile and Web Based


Longer development time as

Mobile and Web Based


Web version is run on the devices

ment

both IOS and Android does not

browser and each devices has its

have the same programming

own features and limitations.

language. However, it provides

One programming language (e.g.

more customization capability on

HTML) for all devices.

Hardware

the Application UI and view.


Has more access to the hardware

Has limited access to the

Interface

and information of the devices.

hardware and information of the

(i.e. camera, accelerometer, GPS

devices.

Distributi

etc.)
App is listed in the IOS The APP

Web version is browser based;

on

Store and Android Google Play,

hence there is no need to

this makes it easy for user to

download and install. This makes

locate, download and use the

the software update and

app. However, this also creates a

maintenance patch done on the

problem of user choose not to

server without user involvement

update the app with new content

and all user will be using the

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One


or maintenance patch.
latest version. However, app
awareness will be low as user
need to search harder to find our
app.

With advances in cell phone technology, users are no longer desk bound just to get
on the internet. The time users spent on the mobile grows exponentially and from
below chart we know Mobile digital media time in the US is now significantly higher
at 51% compared to desktop (42%).

Time spent per Adult user per day


Mobile

Desktop/Laptop

Other online devices

2.8

2015

2.4

2.6

2014

0.4

2.4

0.3

Years
2.3

2013

2012

2.3

1.6

2.6

0.3

0.3

Hours per day

Fig 2 Mobile Internet Trends Mary Meeker 2015

The Hotel One mobile application is intended to capitalize on the growing trend of
user using mobile devices to facilitate the day to day activities like searching the
web, paying bills, shopping online and also searching and booking for the next
holiday getaway while waiting for the train.

Business IT Pte. Ltd

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2.3

Business Plan for Mobile Application Hotel One


COMPETITOR ANALYSIS

Competitor analysis is critical to any business plan when introducing a new product
to a new market. Our competitor analysis will help in our business decision by
evaluating the existing competitors information and their potential impact.
After evaluated the market share, we concluded that the top 5 major competitor
Apps are as follows:
Name of App
Hotels.com Hotel Reservation

App icon

United States - 2001


Expedia Hotels, Flights & Cars
United States - 2001
trivago - Hotel Search
Germany - 2008
Booking.com Hotel Reservations
Netherlands 1996
Hotel Tonight - Amazing Deals
United States - 2010

Below are detail descriptions of the competitor application and also a comparison
chart against Hotel one App.
Hotels.com
Hotels.com

Features
Book direct
All available travel deals are displayed
Save favorite deals and comment on deals
Share and research travel deals
Online user reviews

Business IT Pte. Ltd

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Hotels.com
Expedia

Business Plan for Mobile Application Hotel One


Features
Exclusive deals, last minute deal saving
Insider tips from travel experts
Lodging and trip reviews
Luxurious trips to resorts, beach paradise and ski

lodges
Booking under a minute

Trivago

Quick and simple 3 steps booking


Hotel comparison tool
Find available hotel near GPS location
Share deals, view reviews and photos
Last minute hotel search

Booking.com

Extended list of hotels and lodging available


Great deals with cheap options and last minute

booking
Available sync of app and website
Price filter and review filter
Extensive user reviews online

Able to book a hotel in 10 seconds


Great deals on last minute hotels
Advance hotel room booking
24/7 Customer service support
Exclusive savings and hotel descriptions

Hotel Tonight

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

Features

User

High

Medium

Medium

High

Medium

Interface
Average

4.4

3.9

4.1

4.6

4.3

Rating
Updates
Range

Frequent
2km

Moderate
2km

None
2km

Frequent
3km

Moderate
2km

New App
1km

finding
Map

US

US

Europe

Europe

US

Asia

Search

Mainly

Mainly

Mainly

Mainly

Mainly

Pacific
Initially

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

3 MARKET ANALYSIS
We conducted market research analysis to gather target market information which
can be divided into two sections. First is the market and targeted customer group,
the second is competitor analysis. Finally, we conduct a SWOT analysis to better
understand our selves and align our strategies with our business.

3.1 MARKET

AND

CUSTOMER GROUP

According to The International Air Transport Association (IATA) press release on 8


March this year; global passenger traffic results for January 2016 showing demand
(revenue passenger kilometers or RPKs) rose 7.1% compared to January 2015. This
was ahead of the 2015 full year growth rate of 6.5%. (IATA, Stronger Passenger
Demand Continues into 2016, 8 March 2016)
Several contributing factors like rapid globalization, higher education, rising wealth
and growth of middle class in many Asia emerging countries give rise to the
increase in numbers of travelers.
Asia Pacific stood at the top of the global transport by contributing to 31.5% of the
market share.

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

Fig 3 Global Transport Market

The next questions to ask is how many international visitors does Singapore
welcome in a year and what are the demographic of these visitors? What is the
average stay duration of visitors? To answer these question, we look to the
Department of Statistics Singapore for historical statistical data published.
0% 4%
Americas;
Oceania; 8% Others;

Europe; 11%

Asia; 77%

Fig 4 International Visitor Arrivals by Regions in 2015

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One


The majority of our international visitor come from the Asia region which
contributed 77%, whereas Europe is at 11% and Americas is at 4%. (Yearbook of
Statistics Singapore, Statistics Tables)
16,000.0

10,000.0

51.1
141.3
408.2
229.5
333.6
245.9
353.3
593.0
1,170.4
2,156.9

8,000.0

2,565.4

14,000.0
12,000.0

6,000.0

50.7
140.9
438.6
236.1
352.0
264.6
388.5
659.5
1,286.5
2,265.4

46.7
117.1
415.6
235.9
354.6
270.7
398.6
707.4
1,370.2

2,572.3

2,494.4

2,627.1

2,729.7

3,669.5

3,231.3

3,179.5

CY 2013

CY 2014

CY 2015

3,065.2

4,000.0
2,000.0
0.0

2,274.8

Under 1

8-10

11-14

15 - 29

30 - 59

60 & Over

Fig 5 International Visitor Arrivals by Length of Stay

The average length of stay for international visitor are 3.5 days, 3.7 days and 3.6
days for CY 2013, CY 2014 and CY 2015 respectively. (Yearbook of Statistics
Singapore, Statistics Tables)

3.2 SWOT ANALYSIS


A Strengths, Weaknesses, Opportunities and Threats analysis is a very good way to
evaluate and align the business to maintain strength, eliminate weaknesses,
counter threats and exploit opportunities.

Strengths

Weaknesses
- Unable to use without internet,

Mobile application market is

growing trend.
Easy access with anytime

certain area GPS signal low.


Unforeseen threat like virus

anyway.
Multi-platform available.
Popular makes it easy for

attack.
System needs to be upgraded
Employee must be profession

customer to place order.


Opportunities

skill
Threats

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One


Extend business model to
- Another same function app in

advertising
Royal member program to
reward monthly higher spend
member.

market
Someone who want to copy idea
An increasing number of device
to support.

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

4 MARKETING STRATEGY AND IMPLEMENTATION


SUMMARY
4.1 MARKETING STRATEGY
The next step is to ask the question: how do we reach our potential customer? How
to introduce them to our app and convert them to become our customer? This can
be achieved by our marketing strategy.
We will be using two types of marketing strategies:

Mass Marketing: Marketing technique of disseminating the message to


anyone and everyone through mass media channels such as television, radio,

internet etc.
Direct Marketing: straight communication channel to potential customer
through emails, interactive websites, fliers and magazine advertising.

4.2 SALES STRATEGY


Our business model will describe how we generate revenue through our mobile
application as there is various business model in mobile app business and we have
chosen In App Advertising model; the mobile App will be free for user to download
and we will have ads places within the user interface like banners and we get paid
by advertisers when user click on the ads.

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

5 COMPANY DESCRIPTION
5.1 COMPANY SUMMARY
Business IT Pte. Ltd is a young company that was registered in 2014 that provides
expertise in Mobile Application design and APP service provider. Business IT is a
partnership company and the goal is to be as inexpensive as possible utilizing no
debt financing and a home office start-up. The current Director/Owner of the
company are Mr. Koh Leong Chian and Mr. Danny Ang.

5.2 MISSION
Hotel One (H1) is the most complete mobile app for travellers of all types to
search and book their stay be it at a hostel, a bed and breakfast motel, a home stay
or a 6-star hotel. Our purpose is to provide an innovative mobile application to help
users by transform the process of booking a stay or a trip into a simple and intuitive
experience. Our application will provide the user with all relevant and necessary
information plus additional services right in the palm of their hands.

5.3 KEY

TO

SUCCESS

High development skills


Good strategic plans and good relationship partners

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

5.4 COMPANY FINANCIAL


Past Performance
Sales
Gross Margin
Operating Expenses

2014
$ 587,882
$ 176,766
$ 36,899

2015
$ 643,671
$ 289,764
$ 43,887

Balance Sheet

2014

2015

Current Asset
Cash
Other Current Asset
Total Current Asset

$ 233,776
$ 278,766
$ 512,542

$ 297,863
$ 301,879
$ 599,742

Current Liability
Accounts Payable
Current Borrowing
Other Current Liability
Total Current Liability

$
$
$
$

$
$
$
$

Other Input
Payment Days

30

189,848
30,622
220,470

242,380
41,654
284,034

30

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

6 PERSONNEL SUMMARY
6.1 PERSONNEL PLAN
The follow is our personnel plan. We will be engaging one developer for the
marketing and customer support of the mobile app in the initial phase and
subsequently this will be reduced. Xxx will handle the web maintenance and the
community administrator.
Personnel Plan
Developer
Business IT Pte.

2016
$15,000
$96,000

2017
$9,000
$96,000

2018
$9,000
$96,000

Ltd
Total people
Total Payroll

6
$111,000

6
$105,000

6
$105,000

6.2 PROJECTED CASH FLOW (YEAR 1)


Personnel Plan
Pro Forma Cash Flow
Cash from Operation
Cash sales
Subtotal
Expenditure
Cash Spending
Bill payment
Subtotal
Additional Cash Spent
Purchase Current
Asset
Subtotal
Net Cash Flow
Cash Balance

Worst

Medium

Best

$34,567
$34,567

$57,897
$57,897

$97,233
$97,233

$111,000
$$111,000

$111,000
$$111,000

$111,000
$$111,000

$2,600

$2,600

$2,600

$2,600
$113,600
($79,033)

$2,600
$113,600
($55,703)

$2,600
$113,600
($16,367)

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

7 CONCLUSION
Despite growing consumer demand for online service and purchase via mobile
devices, the capability remains scarce in most markets. Plus, modern consumption
patterns tend to be fast, convenient and secure. We at Business IT Pte. Ltd. wants to
provide a system to overhaul and revitalise all previous cumbersome order
processes.

When launching mobile version Hotel One in the market, we have considered the
key factors consumers are looking for: price discount, ease and security of
transaction. Hotel One is able to perform all the desired key factors and also
perform comparison with other opponent about price and hotel details; as one of
our mission at Business IT is to present the most latest and most accurate
information to our customer.

Ours proposal has showed the flow, structure and working of the Hotel One; and it is
user friendly, ease of use and is readily accessible on largest mobile market
platform which is IOS and android. Hotel One most important competitive edge is
the low cost/high profit business model, that and also our ability to filter the
information efficiently for the user. It changes the experience of booking a hotel into
a much easy and friendly by combines all aspects of the process into one quick and
reliable platform.

Business IT Pte. Ltd aims to be the top provider of hotel booking service in the
market where it is constantly evolving, we can conclude that a good application can
be used to reduce human effort and time on cumbersome traditional hotel booking
system. This business plan is to provide most of the information that can be
prepared before entering the market; but a plan is only effective when it has been
tested and proved. We at Business IT will adapt and adjust our product along this
ever-evolving market to emerge as the top service provider in Asia Pacific.

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

Business IT Pte. Ltd

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Business Plan for Mobile Application Hotel One

8 SOURCES
1. Mobile Internet Trends Mary Meeker 2015
http://www.smartinsights.com/?attachment_id=53811
2. IATA (8 March 2016) Stronger Passenger Demand Continues into 2016:
http://www.iata.org/pressroom/pr/Pages/2016-03-08-01.aspx
3. Department of Statistic Singapore, Yearbook of Statistics Singapore:
http://www.singstat.gov.sg/publications/publications-and-papers/reference/yoscontents

Business IT Pte. Ltd

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