The Haven Business Plan Project

The Haven Business Plan Project

Gail Olszewski, Jacqueline Wills, Katherine Lulkiewicz, Chirag Patel, Mehjabeen Lukmanji, Bethany Phillips

BA-101

May 26th, 2009

Overall Strategic Concept

Airline passengers are increasingly faced with flight delays and layovers. Some of the busiest airports in the northwest region of the UnitedState are Seattle,Washington (Sea-Tac), Portland,Oregon (PDX), San Francisco,California (SFO), Los Angeles,California (LAX), and Denver,Colorado (DEN). Many passengers are in need of sleeping accommodations when flights are delayed for hours, and even up to days, due to poor weather conditions or other types of delays. One delay example is when the public watches news stations reporting about passengers sleeping in the airport terminals during inclement weather during the Christmas holidays. Hotels and motels are often booked to full capacity and are also a more costly choice of accommodations. Other factors for delays may include: mechanical issues, flight over-booking, mechanical caused delays, to name a few. An economical accommodation alternative when passengers are delayed in airports is a business called The Haven. “…summer 2007 was part of the worst year on record for flight delays, cancellations, and long on-board delays. From January through December 2007, over one in four flights (29%) was delayed or cancelled, affecting about 163 million passengers. More than 88,234 flights experienced taxi-in and taxi-out times of one hour to five hours or longer, affecting nearly 5.8 million people.” (Scovel III, 2008).

The Haven is an inexpensive, efficient, and sanitary sleeping accommodation that also allow passengers to sleep worry free because possessions are securely locked up in the customers sleep chamber. The Haven is convenient because the sleep chambers will be located within the airport, giving passengers with layovers easy access to immediate, restful sleep while feeling secure.The sleep chambers will be located in one central location and be among the shops and food outlets in the airport. The sleeping chambers will be rented by the hour or up until passengers’ layovers are lifted. The Haven will contain 15 sleeping chambers that would measure 7.5 feet by 7.5 feet, have a twin bed with enough room to move comfortably around the bed and to house a passenger’s luggage. Bed linens will be provided for customers. Currently, no other competitors for this service exist. The Haven will have a competitive advantage despite the current economic conditions. Airlines are not experiencing a major decrease in travel. The current economic struggle may benefit The Haven because with cheaper plane tickets, passengers experience inconvenient travel times with long layovers. Large businesses with traveling employees may pay for employees to sleep at The Haven as opposed to a hotel or motel, due to cost cutting in today’s economic environment and even during better times to keep costs low.

The Haven will change the travel scene, making stopovers and flight delays a more relaxing and enjoyable experience rather than trouble for passengers. The Haven will allow business men and women to save time, rejuvenate, and perform his or her best at work while on business trips. The business men and women’s superiors will be only too happy with his or her employee’s performance and content with the money saved by sending employees to a frugal, yet respectful place of slumber. The Haven will also allow leisure travelers’ a place to rest so he or she can be energized to have fun or go about business once he or she reaches his or her destination.

The marketing entry strategy will define the competitive marketplace, address implementation, and support the day-to-day operations. Affordable pricing, obtaining facilities within the airport and effective promotion and advertising will also be key market strategies. Some of the market entry strategies will be to advertise and promote The Haven in the five airports referenced previously. The Haven will buy-out the rights to advertise on the napkins distributed on flights with major air carriers. Advertising on napkins will help boost awareness about The Haven because every airline passenger is given a napkin when he or she receiveshis or her food and beverage. The duration of setting up The Haven and executing to the deliverables and the timeline is one year from start to finish.

Executive Summery

Today’s economic conditions have resulted in businesses adjusting to shrinking travel budgets and leisure travelers cutting back on travel expenditures and possibly having to endure a night of sleep at an airport terminal instead of seeking a hotel for an overnight layover or delayed flight.

The Haven offers a convenient and economical alternative to airport hotels for short–term and over night rest and relaxation. Customers will encounter premium sleeping accommodations with all the convenience of an airport location for a nominal fee.

The Haven will initially launch with locations in 5 main U.S. airports in the western United States. These locations include; Portland, OR, Seattle, WA, Los Angeles, CA., San Francisco, CA, and Denver, CO. Future plans call for expanding out to the Midwest and East coast airport locations and international locations.

Marketing efforts will be strategically focused towards a target market of domestic and international business and leisure travelers. Our secondary target market includes travel agencies that can reach and sell our services to the masses. The Haven will utilize a variety of print and internet media advertising to increase awareness and reach new and repeat customers. Traditional print media will include full page ads in airline travel magazines and posters at each airport location, while online advertising will consist of a customer friendly website, advertisements on travel websites, and executives will actively participate on travel blogs.

The Haven projects capital costs of $62,000 and allocates $452,000 for first year operating costs and $605,000 for operating costs there after. Forecasts indicate that first years sales expect to reach over $972,000 with sales exceeding $1.3M each following year, reaching our break even point within the first year of operations. Capital budget for The Haven includes a mix of bank financing and 10% investment by the company’s board of directors.

Our board of directors and investors each possess unique business attributes and experience to successfully develop and operate The Haven. Our executives are well versed in domestic and international sales, leadership excellence, finance, marketing, and operations. The Haven will also employ and train customer centric sales experts and managers to manage daily operations at each location.

CRITICAL EVENTS ANDMILESTONES GRAPHIC

Business Management Plan and Team

1. Organizational Structure and Plan

1. Problem Solving

A. Define the Problem

B. Look at potential causes for the problem

C. Identify alternatives for approaches to resolve the problem

D. Select an approach to resolve the problem

E. Plan the implementation of the best alternative (action plan)

F. Monitor the implementation of the plan

G. Verify if the problem has been resolved or not

2. Planning

A. Basic terms: Goals, strategies or activities, objectives, tasks, resources.

B. Overview of Phases in Planning

1. “Mission” or desired result

2. Take stock inside and outside the system

3. Analyze the situation

4. Establish goals

5. Establish strategies to meet goals

6. Establish objectives to achieving goals

7. Associate time lines with each objective

8. Write and communicate a plan document

9. Acknowledge and celebrate accomplishment of the plan

C. Guidelines to Ensure Success

1. Involve the right people in the planning process

2. Document the planning process and communicate the plan

widely.

3. Goals and objectives should be SMARTER (Specific,

Measurable, Acceptable, Realistic, Time Frame, Extending, and

Rewarding)

4. Hold responsible parties accountable

5. Note differences from the plan and re-plan accordingly

6. Evaluate the planning process and the plan

7. Recurring planning process is at least as important as the plan

document

8. Nature of the process should be compatible tonature of planners

9. Acknowledge and celebrateresults

3. Management Meetings

A. Select participants

B. Develop agendas

C. Opening Meetings by chairperson

D. Establishing ground rules

E. Time management

F. Evaluations of the meeting process and meeting effectiveness

G. Meeting wrap-up

H. Minutes and publish

4. Delegation

A. Delegate the task to one person

B. Select the best candidate

C. Clearly specify preferred results

D. Delegate responsibility and authority

E. Ask the employee to summarize and paraphrase his or her perception of

theproject and preferred results

F. Obtain ongoing non-intrusive feedback about progress on the project.

G. Maintain open lines of communication

H. Evaluate and reward performance

5. Communications

A. All employees will be required to prepare weekly status reports to his

or her supervisors

B. Hold combined monthly meetings with all employees

C. Hold combined weekly, or bi-weekly, meetings with all employees

D. Supervisors will meet with direct reports in monthly one-on-one’s

6. Managing Personal Performance

A. Each employee will monitor his or her work hours

B. Recognize signs of stress

C. Obtain a mentor or coach

D. Learn to delegate

E. Communicate frequently

F. Recognize what is important from what is urgent (fix the system, not

theproblem).

G. Recognize Accomplishments

Jacqueline Wills- Experience with financial administration of retail sales and service operations. Management of high-volume retail operations. Includes supervision of merchandising, asset management, customer service and maintenance. Created effective marketing programs and maintained compliance with corporate procedures. Responsible for training, scheduling and motivation of staff personnel.

Katherine Lulkiewicz- Coordinated the effectiveness of staff members' functions with the implementation of a computerized purchasing and billing system. Performed Human Resource management duties, i.e., recruitment, selection, training and development, benefits, policies and procedures.

Chirag Patel- Handled established accounts and all new calls/sales for European, Japanese and U.S. exports. Prepared price quotations and government tenders; advise on delivery and order specifications. Wrote new product proposals and manufacturing documents, determining needs and coordinating assembly of all necessary materials. Processed orders, credit memos, letters of credit, substitutions, return authorizations and product complaints.

Mehjabeen Lukmanji-Supervised staff of 10; Trained, scheduled, evaluated and delegated responsibilities- monitored work completed and gave final approval upon completion. Reviewed damaged item listings, determined whether to repair and ship to repair shop. Received awards for ‘Outstanding Performance’ 1993, 1994.

Bethany Phillips- Financial management of $2M multi-department annual budget. Developed and projected new annual budget, balanced and allocated funds and ensured branch departments met financial goals.

Gail Olszewski- Integral member of management team involved in goal planning, forecasting, cast evaluation and problem solving. Lead and provided guidance to cast members. Trained, supervised, and evaluated operation’s interns. Selected and trained advance cast personnel in specific city travel and performance guidelines including logistics, scheduling, cultural information, and team communication.

2. Corporate Governance Policies and Assurances

The Haven has a well-established Board of Directors with widely accepted goals and objectives. Serviced by professional managers and staff who prepare agendas, organize reports and information and are educated on sleep (giving them the title of a “sleep expert”). Sub-committees address a defined set of financial and policy issues on the basis of clear remits. Votes are rarely taken and The Haven relies on managers to make recommendations on major issues and direct the organization. The Haven team will all serve on the Board of Directors and will occasionally provide consulting to the business if and when needed. The Board of Directors roles are as follows:

Legal responsibilities and requirements – acting as charity trustees, company directors, owners of property, employers, etc.

Long-term visionaries– acting as ‘think tank’ and environmental analysts.

Policy-making – decideon the overall policy, broad strategy and framework of the organization.

Supervision and support – ensure that policies are appropriately implemented and that staff and volunteers are adequately supported and trained.

Financial responsibility – take ultimate financial responsibility for the organization, including possible acquisition resources and ensure the organization’s financial management is in place.

Representation and accountability – official forum for reflecting on the interests of stakeholders.

Monitoring – ensure that the quality of service andprogress towards mission accomplishments are maintained and enhanced.

Ethical policies and equal opportunities – ensure that clear statements of intent and a code of ethics are developed, implemented and maintained.

1. Key Advisors and Supportive Services

Any business must have supportive services for success.With regard to The Haven, all investors are highly educated and have extensive backgrounds in entrepreneurship.Some of the entrepreneurship areas are restaurants, hotels, gas stations, and retail stores. With a wide range of business operation experiences, the investors will play an active role in seeing that The Haven is a successful business and he or she will serve on the Board of Directors while some investors will provide consulting, as needed. For example, if one of the early test market sleep centers experience issues with financial or customer service, one of the investors specializing in that specific area will serve as a consultant for resolution back to the normal flow of business.Since each sleep center will have staff to run day-to-day operations with the Denver manager owning hiring, performance managing and bookkeeping, outside consultants will not be necessary with the exception of the annual external audits.Outside consultants will only be hired temporarily as needed, such as attorneys.Attorneys will be needed to draw-up contracts when starting to expand new sleep centers, reviewing the lease contracts at the five initial locations, assisting with the filing of the patent and trade-mark of The Haven, or when any legal issues that may arise in the future. A full-time attorney on retainer would not be cost effective with the small business just starting. Furthermore, the Denvermanager will be trained properly to handle financial duties and day-to-day operational duties for each sleep center. The manager will also be trained to handle larger issues and financial duties on a larger scope. The training is extensive and will be provided to the manager by outside consultants as needed and primarily by the Board of Directors.

1. Organizational Responsibility

The extent and nature of the Haven’s impacts on its stakeholders and community will change and increase as the development progresses. The Haven has decided possible roles and activities that will contribute to the community’s “greater good.” Some roles include donating blankets, pillows, etc. to homeless shelters, women crisis centers, and other places of need. This will not only promote the Haven but will help keep our community warm and comfortable with the Haven’s quality products. The feasibility of donating blankets to the airlines to help keep passengers comfortable will be analyzed, given that most airlines have removed pillows and blankets from as a complimentary service. The Haven logo will be on all of the businesses products and will help promote the business in order to sustain the company’s commitment and to the community’s “greater good.”

1. Production, Manufacturing or Operations

The Haven will lease spaces for the sleep centers in various airports on the west cost, as test markets. The beds for the sleep centers will be purchased at wholesale prices, and will be of high quality to assure that our customers receive the best bed for an affordable price. The leased space will be used but in good condition and if imperfections exist, the general contractor hired for the fit-up will make the necessary improvements to ensure that the sleep center is up to spec and meets all requirements that upper management specifies. The Haven will purchase the beds to furnish the sleep centers.All furniture will be of high quality but cost will be monitored against the budget to keep costs low. Furthermore, The Haven will make wholesale purchases to keep cost down at start-up. Quality control will not be an issue because purchasing quality beds will have longevity. In addition, each sleep center will be stocked with one to two back up beds for contingency planning. No issues are foreseen with the beds until several years out.

Market Feasibility and Viability

Differentiation Strategy:

Air travel is nearly unavoidable in today’s global environment. However, the financially challenged airline industry frequently results in overbooked flights, longer layovers and terrible connections for travelers. Travelers often find themselves stranded away from the comfort of their home and having to incur expensive lodging fees at an airport hotel or experience the extreme discomfort of sleeping on the terminal floor or a nearby gate bench.