Pre-Feasibility Study: Beach Resort

Pre-Feasibility Study
BEACH RESORT
Small and Medium Enterprises Development Authority

Ministry of Industries & Production
Government of Pakistan
www.smeda.org.pk
HEAD OFFICE
4th Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road,
Lahore
Tel: (92 42) 111 111 456, Fax: (92 42) 36304926-7
helpdesk@smeda.org.pk
REGIONAL OFFICE REGIONAL OFFICE REGIONAL OFFICE REGIONAL OFFICE

PUNJAB SINDH KPK BALOCHISTAN
3rd Floor, Building No. 3, 5TH Floor, Bahria Ground Floor Bungalow No. 15-A
Aiwan-e-Iqbal Complex, Complex II, M.T. Khan Road, State Life Building Chaman Housing Scheme
Egerton Road Lahore, Karachi. The Mall, Peshawar. Airport Road, Quetta.
Tel: (042) 111-111-456 Tel: (021) 111-111-456 Tel: (091) 9213046-47 Tel: (081) 831623, 831702
Fax: (042) 36304926-7 Fax: (021) 5610572 Fax: (091) 286908 Fax: (081) 831922
helpdesk.punjab@smeda.org.pk helpdesk-khi@smeda.org.pk helpdesk-pew@smeda.org.pk helpdesk-qta@smeda.org.pk
January 2012
Pre-feasibility Study Beach Resort 2
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DISCLAIMER
The purpose and scope of this information memorandum is to introduce the subject matter
and provide a general idea and information on the said area. All the material included in
this document is based on data/information gathered from various sources and is based on
certain assumptions. Although, due care and diligence has been taken to compile this
document, the contained information may vary due to any change in any of the concerned
factors, and the actual results may differ substantially from the presented information.
SMEDA does not assume any liability for any financial or other loss resulting from this
memorandum in consequence of undertaking this activity. Therefore, the content of this
memorandum should not be relied upon for making any decision, investment or otherwise.
The prospective user of this memorandum is encouraged to carry out his/her own due
diligence and gather any information he/she considers necessary for making an informed
decision. The content of the information memorandum does not bind SMEDA in any legal
or other form.
DOCUMENT CONTROL
Document No. PREF-31

Revision 1
Prepared by SMEDA-Balochistan
Issued by Library Officer
Issue Date January 2012
BAL-PREF-32/January 2012
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Table of Contents
1. INTRODUCTION TO SMEDA.............................................................................................................. 5
2. PURPOSE OF THE DOCUMENT ......................................................................................................... 6
3. PROJECT PROFILE............................................................................................................................. 6
3.1 Project Brief................................................................................................................................... 6
3.2 Opportunity Rationale ................................................................................................................... 6
3.3 Market Entry Timing ...................................................................................................................... 7
3.4 Proposed Business Legal Status...................................................................................................... 7
3.5 Project Capacity and Rationale....................................................................................................... 8
3.6 Proposed Product Mix.................................................................................................................... 8
3.7 Project Investment......................................................................................................................... 8
3.8 Proposed Location ......................................................................................................................... 8
3.9 Key Success Factors/Practical Tips for Success................................................................................ 9
3.10 Government Incentives for Investment in Tourism Sector ............................................................ 9
3.10.1 Tourism Industry ................................................................................................................... 9
3.10.2 Foreign Exchange ................................................................................................................ 10
3.10.3 Chartered Flights................................................................................................................. 10
4. CURRENT INDUSTRY STRUCTURE ....................................................................................................... 11
4.1 Global Scenario............................................................................................................................ 11
4.2 Overview of the Year 2011........................................................................................................... 11
4.3 Tourism in Pakistan...................................................................................................................... 12
4.3.1 Tourism in Balochsitan .......................................................................................................... 12
4.3.2 Coastal Tourism .................................................................................................................... 13
5. MARKETING STRATEGY .................................................................................................................. 14
5.1 Target Customers......................................................................................................................... 14
5.2 Market Potential.......................................................................................................................... 14
5.3 Pricing Strategy............................................................................................................................ 14
5.3.1 Additional Revenue ............................................................................................................... 14
6. PROJECT REQUIREMENTS .................................................................................................................. 15
6.1 Main Project Requirements ......................................................................................................... 15
6.2 Equipment Details........................................................................................................................ 15
6.3 Furniture and Equipment Maintenance........................................................................................ 16
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6.4 Human Resource Requirement .................................................................................................... 16

7. LAND & BUILDING REQUIREMENT ................................................................................................. 16
7.1 Land Required.............................................................................................................................. 16
7.2 Covered Area Requirement.......................................................................................................... 16
7.3 Recommended Mode .................................................................................................................. 17
7.4 Utilities and Infrastructure Requirement...................................................................................... 17
8. STARTING A SUCCESSFUL BEACH RESORT BUSINESS ...................................................................... 17
8.1 How to Start a Beach Resort?....................................................................................................... 17
8.1.1 Work in a Similar Hospitality Business ................................................................................... 17
8.1.2 Know Your Target Market ..................................................................................................... 17
8.1.3 Develop a Business Plan ........................................................................................................ 18
8.1.4 Choose a Location & Layout .................................................................................................. 18
8.1.5 Getting the Appropriate Funding ........................................................................................... 18
8.1.6 Be Familiar with Safety Regulations....................................................................................... 18
8.1.7 Hiring Employees................................................................................................................... 18
8.1.8 Advertise & Market ............................................................................................................... 19
8.2 Deciding on the Layout ................................................................................................................ 19
8.2.1 Separate Bamboo Huts.......................................................................................................... 19
8.2.2Kitchen Operations and Dining Area....................................................................................... 19
8.2.3 Reception Area...................................................................................................................... 19
8.2.4 Conference Hall..................................................................................................................... 19
8.3 Hiring the Right Employees .......................................................................................................... 20
8.4 A Good Hospitality Business Experience....................................................................................... 20
9. PROJECT ECONOMICS ......................................................................... Error! Bookmark not defined.
10. ANNEXURE – FINANCIAL STATEMENTS....................................................................................... 21
11. KEY ASSUMPTIONS .................................................................................................................... 27
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1. INTRODUCTION TO SMEDA
The Small and Medium Enterprise Development Authority (SMEDA)1 was established with
the objective to provide fresh impetus to the economy through the launch of an aggressive
SME support program.
Since its inception in October 1998, SMEDA had adopted a sectoral SME development
approach. A few priority sectors were selected on the criterion of SME presence. In depth
research was conducted and comprehensive development plans were formulated after
identification of impediments and retardants. The all-encompassing sectoral development
strategy involved recommending changes in the regulatory environment by taking into
consideration other important aspects including financial aspects, niche marketing,
technology up gradation and human resource development.
SMEDA has so far successfully formulated strategies for sectors including, fruits and
vegetables, marble and granite, gems and jewelry, marine fisheries, leather and footwear,
textiles, surgical instruments, urban transport and dairy. Whereas the task of SME
development at a broader scale still requires more coverage and enhanced reach in terms
of SMEDA’s areas of operation.
Along with the sectoral focus a broad spectrum of business development services is also
offered to the SMEs by SMEDA. These services include identification of viable business
opportunities for potential SME investors. In order to facilitate these investors, SMEDA
provides business guidance through its help desk services as well as development of
project specific documents.
These documents consist of information required to make well-researched investment
decisions.
Pre-feasibility studies and business plan development are some of the services provided to
enhance the capacity of individual SMEs to exploit viable business opportunities in a better
way.
This document is in the continuation of this effort to enable potential investors to make
well informed investment decisions.
1
For more information on services offered by SMEDA, please visit our website: www.smeda.org.pk
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2. PURPOSE OF THE DOCUMENT

The objective of the pre-feasibility study is primarily to facilitate potential entrepreneurs in
project identification for investment. The project pre-feasibility may form the basis of an
important investment decision and in order to serve this objective, the document/study
covers various aspects of project concept development, start-up, and production, finance
and business management.
3. PROJECT PROFILE
The project is about starting the business of a Beach Resort at Gwadar beach, Balochistan.
The proposed plan is to offer complete package of boarding/lodging and dinning for
tourists/visitors, and conference hall for different corporate clients for holding
meetings/seminars etc. at Gwadar beach.
3.1 Project Brief
A seaside resort is a resort located on the coast and where a beach is the primary focus for
tourists, it may be called a beach resort. The study provides basic information regarding
the investment opportunity for setting up a Beach Resort at any of the Balochistan’s major
coastal areas such as Gaddani, Sonmiani, Ormara, Pasni and Gwadar. Such a business could
also be established on beaches that fall in Sindh, after conducting initial market
research/surveys and properly analyzing the demand. Currently the project is being
designed/proposed for Gwadar being the most developed part of Balochistan’s coastal
Zone.
The project would serve as a place where tourists, visitors, vacationers and leisure
travelers could stay overnight, dine, and enjoy the breathtaking view of the clear ocean.
Initially the project is proposed to attract domestic tourists/visitors but after its maturity,
international tourists could also become a major part of its customer base.
The main features of the project would include miles of unspoiled virgin beach, luxurious
ocean view, beautiful separate huts, in-hut dining, dining hall, conference hall, and other
basic entertainment facilities.
3.2 Opportunity Rationale
Balochistan has more than 750 Kilometers long coastline with clean and virgin beaches,
tropical forests, exotic mountains, coral reefs and many breathtaking locations. Balochistan
coastal zone has so far been neglected for tourism and travel development despite of
tremendous potential in the sector. Very few areas are seen to have given a bit of attention
by the Government as far as beach tourism and travel is concerned and that too due to
traffic increase of visitors because of Gwadar. During the preliminary surveys, it was found
that towns such as Gaddani, Ormara and
Gwadar have been given attention by the government and private sector for investment.
The completion of Makran Coastal Highway has provided the very basic infrastructure
facility that connects the major towns such as Gaddani, Sonmiani, Ormara, Pasni and
Gwadar. Similarly Gwadar Airport has provided the visitors the facility to reach the town in
around 45 minutes from Karachi and in around 90 minutes from Quetta.
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Visitors and vacationers from Karachi city have diverted to beaches of Balochistan due to
increase of pollution and crowd on Karachi and adjacent beaches. Families are observed at
Gaddani beach on weekends and the number so far has seen inclining. Gwadar on the other
hand has seen to have a bit higher rate of development in terms of tourism and travel
activities, mainly due to Government’s priority in developing Gwadar Port that has
attracted the attention of both public and private sector in investment possibilities. Other
than Gaddani and Gwadar, Ormara has been given attention by the Government due to its
strategically important location in naval point of view. Other tourism and travel related
developments on Balochistan Coastal Belt include the establishment of Hingol National
Park, a few kilometers away from the beach at Hingol Valley, near Ormara.
Looking at a broader perspective, Balochistan coastline was required to be developed by
the government and private sector for tourism and related business activities/investments
much earlier, but this negligence on the other hand provides countless opportunities for
all-scale tourism businesses not only for domestic but also for international investors
specifically in Beach Resorts.
Following are the key points that make the project very much feasible and attractive for the
investors:
 The only beach resort in the province and country
 8 bamboo structured ocean front view huts
 24 hour guest service
 Miles of unspoiled beach
 Ocean view indoor and outdoor dining facility
 Ocean view conference hall
 24 Hour business center
 Cable TV
 Mini Bar
 Peaceful environment
3.3 Market Entry Timing
Although the weather conditions in Gwadar is suitable for tourists/visitors almost
throughout the year but the project is assumed to have business mostly during the winters
and springs as the weather conditions in these 6 months (October – March) becomes very
much comfortable for the visitors. The project therefore, is proposed to become
operational in the start of winter season to attract most of the customers.
3.4 Proposed Business Legal Status
Although the legal status of the business tends to play an important role in any setup, the
beach resort business is proposed to be operated on a sole proprietorship basis which may
extend to partnership in case of expansion and/or addition of new products/services that
might add significant business to the existing setup. Also less complications and costs are
involved in forming, administering and running such a setup and the tax rates applicable
for such arrangement are lower than private or public limited.
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3.5 Project Capacity and Rationale

The project is proposed to have eight (08) separate huts for visitors to stay overnight, one
conference hall, a dinning hall, and an open air dinning place on the first floor. After
project’s maturity in the peak seasons, the resort would entertain 8 families per day and
would facilitate three conferences/seminars/trainings per month.
3.6 Proposed Product Mix
The business setup is proposed to have the following products/services:
1. 08 separate huts on the beach, made of bamboos providing a unique experience to
visitors
2. Conference hall for all sorts of seminars, workshops, and training programs for
corporate clients
3. Open-air dining on the roof and indoor dining services (dining hall and hut delivery
services)
4. To make the project’s operations smooth and less hectic for the investor, it is
proposed that the kitchen (food and beverages) should be handed over to the
second party on Theka basis. The second party contractee will be responsible for
arranging experienced cooks and installing required kitchen machinery &
equipments.
3.7 Project Investment
The total investment required for this project is Rs. 14.88 Million. The investment mainly
covers capital costs of 14.26 Million and working capital requirement of Rs. 0.312 Million.
The project investment summary is given below:
Table 1 - Project Investment Summary
Human Resource Location

Capacity
8 Huts * 180 Days 17 Gwadar, Balochistan
(six months) =
1,440 nights
FINANCIAL SUMMARY
Project Cost IRR NPV Payback Period Cost of Capital
Rs. 14,889,700 36% Rs. 15 Million 3 years 13%
3.8 Proposed Location
The proposed location for the project could be in any of the following areas on Balochistan
coastal belt such as Gaddani, Sonmiani, Ormara/Dam, Pasni, Gwadar and Jiwani. But due to
the availability of infrastructure and comparatively high traffic rate, it is highly
recommended to establish such a project at Gwadar beach to increase its viability.
However, such a project could also be established on beaches of Karachi and adjacent areas
after careful analysis of market demand and project viability.
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3.9 Key Success Factors/Practical Tips for Success

 Location plays the most important role for such a project. Clean virgin beaches of
Balochistan coastal zone are suitable for the project and its viability.
 Trained personnel for the project would add towards the success of the project.
 Awareness amongst the general people would attract more customers therefore; use of
proper marketing techniques is important
 Makran Coastal Highway and Gwadar International Airport provides the connectivity of
the proposed location, Gwadar to the rest of the country making the project easily
accessible for visitors/vacationers and tourists
 Target customers should initially be the domestic tourists. Upon its maturity,
international tourists could also be facilitated
 Consistency in quality products and services would develop confidence amongst the
customers and would help in their retention
 Guest feedbacks should be a regular activity by the management and the viable
recommendations/suggestions should be adopted
3.10 Government Incentives for Investment in Tourism Sector
Government of Pakistan has taken a number of initiatives to attract investment in tourism
sector.
The following initiatives have been taken to attract both domestic and foreign investments
in tourism industry1:
3.10.1 Tourism Industry
1. Tourism is categorized as ‘Industry’ according to the Investment Policy in vogue.
2. Recognizing the importance of Tourism in the socio-economic development of
the country, the Government of Pakistan, decided in September 2004, to create a
separate Ministry specifically to handle Tourism.
a. Promotion & Development of Tourism in Pakistan.
b. Pakistan National Tourism Council.
c. Publicity and establishment of tourists centers in Pakistan and abroad.
d. Establishment of tourism information centers for the guidance of domestic
and foreign tourists in Pakistan.
e. Development of tourist facilities in areas with tourist potential where private
sector is shy to invest.
f. Pakistan Tourism Development Corporation.
g. International organizations and agreements relating to tourism. Tourism and
Hotel training institutes.
h. Facilitation of travel in Pakistan for tourists.
i. Training and research in tourism in Pakistan and abroad.
j. Control and regulation of tourist industries and allied services.
3. Holding of tourism promotional events is one of the best sources to exploit touristic
potential of the country. Therefore, in order to create awareness about tourism
products of Pakistan and to introduce Pakistan as a tourist friendly destination all
1
Ministry of Tourism, Government of Pakistan
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over the world, the Ministry in collaboration with its component

organizations & private sector successfully organized several tourism promotional
events in Pakistan since its inception
4. The Pakistan Tourism Development Corporation (PTDC), besides being a field arm
body of the Ministry of Tourism for the development of tourism infrastructure, also
acts as an agent to the Ministry of Tourism in tourism promotional matters
5. Permission is not required for setting up of tourism project in the Private Sector
3.10.2 Foreign Exchange
1. Permission of the State Bank of Pakistan is not required for repatriation of profits
from tourism projects
2. Foreigners/local and Overseas Pakistanis can open foreign exchange accounts
3. Full repatriation capital, capital gains, dividends and profits is allowed. However,
the share of non-residents is required to be registered with State Bank of Pakistan
4. Foreign investment is welcome. However, it is the prime responsibility of all parties
concerned to ensure that foreign exchange has been raised through legitimate
transactions and not through money laundering etc.
3.10.3 Chartered Flights
1. Permission for chartered flights is given by the Ministry of Tourism in consultation
with Ministry of Interior. Chartered flights are allowed on point-to-point basis from
Karachi, Lahore, Islamabad and Peshawar
2. Helicopter chartered flight services is allowed anywhere in Pakistan
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4. CURRENT INDUSTRY STRUCTURE

4.1 Global Scenario1
Tourism activities are considered to be one of the major sources of economic growth. It can
be regarded as a mechanism of generating the employment as well as income in both
formal and informal sectors. Tourism supplements the foreign exchange earnings derived
from trade in commodities and some times finance the import of capital goods necessary
for the growth of manufacturing sectors in the economy. On the other hand rapid economic
growth in the developed economies attracts foreign travels (Business travels), which leads
to an increase in the foreign reserve of the country.
Over the past several decades, international tourism has been gaining importance in many
economies of the world. According to the World Tourism Organization (2010),
expenditures by 693 million international tourists traveling in 2010 totaled US $ 1162
billion worldwide. In addition, tourists spending have served as an alternative form of
exports, contributing to balance of payments through foreign exchange earnings in many
countries. The rapid growth of tourism led to a growth of household incomes and
government revenues directly and indirectly by means of multiplier effects, improving
balance of payments and provoking tourism-promoted government policies. As a result, the
development of tourism has generally been considered a positive contribution to economic
growth.
4.2 Overview of the Year 2011
Tourism as an organized, regular and multidimensional business activity has grown to the
level of an industry of world wide importance, employing more than 200 million
people around the globe and contributing more than US$600 billion in direct and
indirect taxes each year to global economic development. The substantial growth of
tourism activity over the years clearly marks tourism as one of the most remarkable
economic and social phenomena of the past century that has after three subdued years
(2008-2009) bounced back in 2004 with 10.7 % record increase in international tourist
arrivals, reaching to a new record value of US 622 billion dollars in 20102.
World Gross Domestic Product (GDP) has experienced its longest period of sustained
growth for 25 years, with figures around or above 5% since 2008. Particularly emerging
markets and developing economies are driving the global GDP for the most part of this
decade. This also correlates to their behavior as emerging tourism destinations, which on
average nearly double the growth of destinations in high income countries.
For 2011, confidence remains high, although this perception might deteriorate. Economies
worldwide have shown increased volatility and confidence has weakened in some markets
due to uncertainty about the subprime mortgage crises and economic prospects, in
particular for the USA, alongside with global imbalances and high oil prices.
International tourism might be affected by this global context. But based on past
experience, the sector’s proven resilience and given the current parameters, it is unlikely to
expect that growth in world travel and tourism will come to a halt.
1
World Tourism Organization (UNWTO)
2
Government of Pakistan, Ministry of Tourism, Year Book 2009-2010
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4.3 Tourism in Pakistan

The different types of natural features in Pakistan range from the sandy beaches, lagoons,
and mangrove swamps of the southern coast to preserved moist temperate forests
and the icy peaks of the Himalaya, Karakoram and Hindu Kush mountains in the
north. There are an estimated 108 peaks above 7,000 meters (23,000 ft) high that
are covered with snow and glaciers. Five of the mountains in Pakistan (including the
majestic famous Karakoram Range peak of K2 the official declared National Mountain
and Nanga Parbat) are over 8,000 meters (26,000 ft). Linking Indian-occupied Kashmir
to the Northern Areas of Pakistan and running the length of the country is the Indus River
with its many tributaries. To the west of the Indus are the dry, hilly deserts of
Balochistan; to the east are the rolling sand dunes of the Thar Desert. Most areas of Punjab
and parts of Sindh are fertile plains where agriculture is of great importance. The
climate varies as much as the scenery with cold winters and hot summers in the north and
a mild climate in the south, moderated by the influence of the ocean.
The central parts have extremely hot summers with temperatures rising to 45 degree
Celsius, followed by very cold winters, often falling below freezing. Many cultural practices,
foods, monuments, and shrines in Pakistan were inherited from the rule of Muslim
Mughal and Afghan emperors. The rich variety of Pakistani music ranges from diverse
provincial folk music and traditional styles such as Qawwali and Ghazal Gayaki to
modern forms fusing traditional and western music, such as the synchronization of
Qawwali and western music by the renowned Nusrat Fateh Ali Khan.
Tourism is a growing industry in Pakistan, based on its diverse cultures, people and
landscapes. Examples include ancient civilization ruins such as Mohenjo-daro,
Harappa and Taxila, to the Himalayan hill stations that attract those interested in field
sports and winter sports. Pakistan is home to several mountain peaks over 7,000 m,
which attracts adventurers and mountaineers from around the world especially to K-2.
The northern parts of Pakistan have many old fortresses, towers and other
architecture as well as the Hunza and Chitral valleys, the latter being home to the small
pre-Islamic animist Kalash community who claim descent from the army of Alexander
the Great. Punjab is the site of Alexander's battle on the Jhelum River and the
historic city Lahore, Pakistan's cultural capital with many examples of Mughal
architecture such as the Badshahi Masjid and the Shalimar Gardens.
4.3.1 Tourism in Balochsitan
Tourism and travel in Balochistan has never been properly analyzed and no due
importance was given to this important sector both by public and private sector
organizations in the past. So far the overall focus in promoting tourism has only been on
Quetta City and its adjacent areas, Ziarat Valley, and Sibbi. The excuses given in the past
for neglecting Balochistan in promoting tourism are scattered nature of population,
vastness of area, dearth of skilled labor, social structure, tribal feuds and lack of
marketing facilities. But on the contrary Balochistan has always had the potential to
attract national and international tourists to its coastal region. In 2005, over 2 million
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tourists traveled to Iran and Pakistan. It is safe to assume that only Balochistan’s coastal
areas could attract over 200,000 tourists per year1.
4.3.2 Coastal Tourism
Coastal tourism is one of the oldest forms of tourism. Some beach resorts have been
catering for tourists since the 19th century throughout the world. Originally it was only
the elite who visited the seaside, but the market developed into today’s coastal
tourism which often takes the form of a very high concentration of tourists staying at
the same destination, chiefly during the summer.
One of the tourism assets of Pakistan includes a coastal zone spreading over one thousand
kilometers along the Arabian Sea offering long term development potential for beach
resorts, water sports, fishing, crabbing, mountaineering/trekking and other beach
tourism activities/businesses. The coastline of Balochistan province starts from one corner
of District Lasbela and stretches to District Gwadar. The developed coastal towns that fall
on the way while travelling from District Lasbella to District Gwadar in sequence are
Gadani, Sonmiani/Dham, Ormara, Pasni, Gwadar and Jiwani.
To link Karachi to Gwadar via Hub, around 700 Km long Makran Coastal Highway
(National Highway) has been built. NHA started this mega road link in 2003 and
completed it in a record time of 1.5 years. The highway has been built according to
international standards and it takes around 7 hours of pleasant journey along the coastline
of Arabian Sea to reach Gwadar from Karachi.
The Government is currently developing Ormara as a major naval base and Gwadar
as a major new commercial port. The new naval base at Ormara will host about half
of the Pakistani Navy, whilst Gwadar is planned to reduce the pressure on the two
international ports at Karachi.
Astola Island
Astola Island is the biggest offshore island in the Arabian Sea. It is situated in the northern
side of Arabian Sea, approximately 25 kilometers off the mainland coast, 40 kilometers
east-southeast of Pasni Harbor. It falls under the Pasni subdivision of Gwadar district. It
covers an area of 500 ha and was designated as Ramsar site on 10th May 2001. This un-
inhabited island is the only significant offshore island and potential tourist spot along
the north coast of the Arabian Sea.
Features of Balochistan coastal zone:
 Clean & Virgin Beaches
 Cliffs And Headlands
 Bays & Lagoons
 Mud Volcanoes
 Underwater World
 Suitable Weather Conditions
 Easy Accessibility
o Makran Coastal Highway
1
Stakeholders’ and industry estimates
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o Gwadar International Airport
5. MARKETING STRATEGY
5.1 Target Customers
The target market of the project is very wide in nature. All the tourists/visitors whether
domestic or international could be the major target market for the project. On the same
time, it could also be a facility for the corporate clients who visit Gwadar on business
purposes and want to hold seminars/workshops etc. Similarly, the local residents of
Gwadar and adjacent areas could also be one of the major components of the target market
who could not only stay overnight at the huts but also could enjoy see view dining, lunch or
evening tea.
5.2 Market Potential
As discussed earlier, currently there are no such facility available in the whole country,
therefore, its uniqueness would attract its customers to have a different and new
experience staying at its family huts and/or enjoy the see view meals. Also for corporate
culture, its see view conference hall would also provide a very unique environment.
5.3 Pricing Strategy
Since the project has a very wide range of customer class, the pricing strategy should be
appealing enough to give its customers the value of their money spend while using its
services. On the same time, the charges should neither be very high to compete with PC
Gwadar nor very low to give negative impression in the market. After carefully analyzing
the current hotel/motel cluster in Gwadar, it is proposed that the customers should be
charged somewhere between Rs. 3,000 to 5,000 per night. The investor can always shuffle
the charges according to the market situation and seasons. In this report, Rs. 4,000 per
night charge for only six months (Sept-March) has been taken to calculate project’s revenue
streams. However, the investor can always attract customers to stay at the resort in the off-
season as well adding more revenue to the project.
5.3.1 Additional Revenue
The hall rental per day for different venues such as seminars, training programs,
workshops, birthday parties, anniversaries and other social gatherings should be in line
with the other similar service providers so that the customers could be attracted. Here, it is
assumed that a total of 24 venues (2 per month) will be facilitated and Rs. 10,000 per
venue hall rental will be charged.
The last revenue component of the project is the monthly/quarterly/semi-
annually/annually kitchen heka. Under normal circumstances, such agreements are made
keeping in view the regular flow of customers throughout the year. Since due to weather
conditions, this project has one peak-season (Sept-March) in the year, therefore, it is
assumed that the flow of customers would not be regular throughout the year. The investor
has to keep this factor in mind while deciding the Theka rate. In this pre-feasibility report, a
monthly kitchen Theka rate of Rs. 35,000 has been taken to calculate project’s additional
revenue stream.
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6. PROJECT REQUIREMENTS
6.1 Main Project Requirements
The basic requirements for a beach resort includes management staff and waiters/servers,
furniture and fixture, electronics such as TV/DVD, Multimedia, fridge, air conditioners,
telephone/fax, computer/printer, and electric generator. These equipments are easily and
readily available in the local markets
6.2 Equipment Details
The details of the different machinery and equipment required for the project are given as
below:
Table 2 - Equipment & Machinery Details
No. of Units Price/Unit Total (Rs.)

Description
TV sets 9 21000 189000
DVD players 8 7500 60,000
Multimedia 1 100,000 100,000
Generator 1 525,000 525,000
Fridge 9 12,000 108,000
ACs 4 45,000 180,000
Telephone/intercom 8 1,500 12,000
sets
Total 1,174,000
Table 3 - Office Equipment Details
Qty Cost/unit Total (Rs.)

Description
Computers 2 52,500 105,000
Printers 2 22,500 45,000
Fax 1 18,000 18,000
Telephone sets 3 1,500 4,500
Total 172,500
Table 4 - Furniture & Fixture Details
Total cost (Rs.)

Description
Total office furniture 90,000
Total Hut furniture 600,000
Carpeting & Bedroom 300,000
necessities
Total 990,000
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6.3 Furniture and Equipment Maintenance

The furniture and equipment maintenance process will be conducted on yearly basis.
6.4 Human Resource Requirement
The manpower required for operating the Day Care Center is as follows:
Table 5 - Human Resource Requirement Details
Qty Monthly salary Total monthly salary (Rs.)
Description
Manager 1 40,000 40,000
Accounts/Admin Officer 1 25,000 25,000
Waiters/servers 5 12,000 12,000
Guards 3 8,000 24,000
Sweepers 6 6,000 36,000
Total 137,000
Note: The staff salaries are estimated according to the market trends; however, the investor
may set different pay scales.
7. LAND & BUILDING REQUIREMENT
7.1 Land Required
Such an arrangement is possible by acquiring the land on 99 year lease from the revenue
department, Government of Balochistan, pre-approved by GDA. The details are as under:
Table 6 - Land Requirement Details
Description Area required Total lease price/acre Total price (Rs.)
Land ½ Acre Rs. 180,000 90,000
Total 90,000
7.2 Covered Area Requirement
The proposed project layout is to have main building of 3,000 Sq.ft. in the center with 08
separate bamboo huts (04 huts on each side of the building). The building will consist of
one office, reception area, lobby, kitchen space, and a conference hall. Each hut will have
one living room, one bedroom, and one washroom. The estimated cost details are as under:
Table 7 - Covered Area Requirement Details1
Sq. Ft. Construction Total Cost
Description
Required rate/Sq. Ft. (Rs.)
Reception, lobby, Kitchen, 3,000 1,800 5,400,000
Conference Hall, Washrooms
(ground floor)
Dining hall, Washrooms (1st 1,500 1,500 2,250,000
floor)
Terrace Grills (open air 30,000
1
All cost estimates are based on January 2012 market prices
---------------------------------------------------------------------
dining)
08 Bamboo Huts (each with 396 * 8 = 3,168 1,275 4,039,200
bedroom, living room, and
washroom)
Total Building/Covered Area 11,719,200
7.3 Recommended Mode
It is recommended that the proposed project should be constructed on leased/purchased
land rather than rented space to maximize monthly revenue and to increase viability of the
project.
7.4 Utilities and Infrastructure Requirement
Basic utilities like electricity, gas and water are required for operating the project.
8. STARTING A SUCCESSFUL BEACH RESORT BUSINESS
From small restaurants and motels to large size hotels, more and more tourist stay areas
are popping up in attractive places in the country. Since hospitality services are becoming a
common business venture, people must also enjoy running them. However, all of those
advantages come at a price – building and operating such a structure from scratch and that
too for the first time in areas like Gwadar is not an easy task. It is a hard and expensive
process, and the reality is that many resorts/hotels fail in their first year of business due to
improper planning and forecasting.
But rest assured there are ways to reduce the risk of becoming another statistic. Following
are some of the handy tips that can help run a successful beach resort establishment.
8.1 How to Start a Beach Resort?
8.1.1 Work in a Similar Hospitality Business
One of the best ways to reduce the risk of owning a failed resort is to have some hospitality
service providing experience before you start your own. Many successful
hotel/motel/resort owners have said that the best way to prepare for owning a similar
setup is by working in one.
You will learn more than just how to receive guests and provide your services with a smile,
you can learn marketing, venue management, payroll, and other significant components.
Working in the hotel industry and learning the basics is an important first step to becoming
a successful owner.
8.1.2 Know Your Target Market
Who does the investor see as guests in his/her resort? Is he/she targeting the whole family,
youngsters, seniors, or corporate people? Knowing the target market before start planning
will not only help the investor solidify his/her overall services but it will also help
determine the location, decor and the overall atmosphere of the resort. A family-style
resort, which caters to parents and their kids, may not appeal to seniors and/or corporate
clients. On the other hand, an upscale, quiet atmosphere offering a two-hour dining
experience wouldn't be appealing to teenagers or families with small children.
---------------------------------------------------------------------
8.1.3 Develop a Business Plan

Like any other type of company, a beach resort will need a concise business plan. This plan
should include but is not limited to: the overall concept and goal of the business, specific
financial information and projections, a description of the target market, the services, menu
and pricing, equipment and employee details, advertising and marketing plan, and a
potential exit strategy.
8.1.4 Choose a Location & Layout
It is important to find a location that has a continuous stream of traffic, convenient parking,
and is in proximity to other businesses. For a beach resort, u may want to select a beach a
little aside the crowded parts of the area where the visitors could enjoy only the beach and
not the traffic and noises that they have become fed up of. On the same time, the investor
should also keep in view its easy proximity for the visitors from the main town/city. In
addition, if the investor acquires the premises on rental basis, he/she should make sure
that the monthly rent is in-line with the business plan's projections. Once the location is
selected, the layout and design of the interior should be taken into account. Investor should
already have a concept of his/her resort in the business plan and bring the concept into the
design of the overall structure. When designing the kitchen area, the investor should
already have the idea about the daily menu in order to determine what is needed for the
food preparation area.
8.1.5 Getting the Appropriate Funding
The business plan will help the investor recognize how much money he/she will need to
start a beach resort. If unsure about how much money will be needed upfront, talking to
other similar business owners can help project the expected start-up costs.
8.1.6 Be Familiar with Safety Regulations
Hotels, motels, restaurants, and resorts are regulated and subject to inspection, and failing
to be up to speed with these regulations could be detrimental to the facility. Therefore it is
necessary to consult with similar business owners/related govt. departments to become
familiar with what one must do to meet the necessary legal requirements.
8.1.7 Hiring Employees
One of the biggest challenges hotels and resorts face is the lack of qualified labor. In order
to get and retain qualified employees, make sure that the pay scales relate clearly to the
job's duties and responsibilities. In addition, find out what other similar setups are paying
their employees so that you can be competitive in the job market, without spending too
much on payroll. However the investor should try linking the payroll with the bottom line
and see how much money can be squeezed out for the employees. Similarly, giving priority
of hiring the local people in the staff gives another advantage as they might be more aware
of the local customs/traditions and would help develop such atmosphere to attract/satisfy
customers. In case of difficulty in finding trained/educated staff, investor may want to train
the staff after hiring them according to the business needs and requirements.
---------------------------------------------------------------------
8.1.8 Advertise & Market

Every business needs a comprehensive marketing plan and such a setup that never has
existed before certainly would need a lot of concentration for its proper introduction in the
market. After determining marketing budget, price out billboard advertising, flyers in
newspapers, and local cable TV advertising. Ask the customers how they found out about
your setup and service, so that you can record where the advertising and marketing money
could be best spent.
8.2 Deciding on the Layout
Layout and design are major factors in introduction phase of any hospitality business.
You'll need to take into account the size and layout of the reception area, kitchen space,
conference hall, and especially the individual huts.
8.2.1 Separate Bamboo Huts
This component should be the main focus of attention while designing its external and
internal layout. The proposed material for constructing the huts is bamboo as it would
provide the natural and a bit different look. Similarly, living in a bamboo hut would provide
a very unique experience to the visitors/tourists especially the domestic visitors as a major
portion of such customers/clients have never had such experience. Since it’s a beach resort,
therefore all the openings of huts should be directed towards the sea shores. Also the space
between the huts should be reasonable enough to provide privacy to visitors.
8.2.2Kitchen Operations and Dining Area
The proposed setup is to hand over the kitchen on Monthly Theka basis. While selecting the
ontractee, the investor should analyze their previous experience in catering and related
services and should discuss/consult the contractee before designing the layout of the
kitchen and dining area so that it should meet their requirements. Once again, the ocean
view should be kept in mind in designing the layout of the indoor/outdoor dining area.
To accommodate the different groups of customers, use tables for four that can be pushed
together in areas where there is ample floor space. This gives you flexibility in
accommodating both small and large parties. Place movable umbrella shades on the open
dining areas (as proposed the facility will have open terrace on the first floor besides the
indoor dining hall) so that the visitors find it comfortable having meals under the sunlight.
8.2.3 Reception Area
For any hospitality business, the layout of the reception area plays a very important role in
attracting and retaining clients. Make sure that the layout should be reasonably large,
comfortable and attractive. Similarly, there should be plenty of sitting areas so that visitors
could comfortably wait for reservation in peak season.
8.2.4 Conference Hall
Since Gwadar has become the focus of not only public sector but also private sector
businesses/companies, therefore it is expected that there is a dire need of such a facility to
accommodate such customers. The conference hall normally is used for organizing
seminars, workshops and training programs. The investor should make sure that the layout
of the conference hall should be in a way to house a reasonable number of people
---------------------------------------------------------------------
comfortably in one time. Ocean view window openings concept can also be used for
designing the layout of the conference hall.
8.3 Hiring the Right Employees
Choosing employees who will do a good job is not only important to the success of the
business, but will also contribute to the overall first and last image of the beach resort,
provided they are properly trained. There are several categories of personnel in the
hospitality business such as manager, receptionist, servers, housekeepers, cooks,
dishwashers and cleaners. When the business is still new, some employees' duties may
cross over from one category to another. For example, your servers may double as the
cleaners. The investor should be sure to hire people who are willing to be flexible in their
duties.
8.4 A Good Hospitality Business Experience
Based on some surveys conducted, following are some of the factors that contribute to a
good hospitality business experience:
 Location
 Characteristics
 Welcome
 Food
 Environment (parking, restrooms, lighting)
 Dessert Variety
 Smile factor
 Time factor/quick service
 The server should greet visitors/tourists on the main gate
 The server should be neat and clean
 The server should not be too chatty or familiar
 The server should know the menu and be able to answer questions
---------------------------------------------------------------------
9. ANNEXURE – FINANCIAL STATEMENTS
Financial Evaluation Summary of Pre-Feasibility Beach Resort
Table 8 - Project Cost

Description Amount (Rs.)
Land 90,000
Building & Infrastructure 11,719,200
Machinery & Equipments 1,174,000
Furniture & fixtures 990,000
Office Equipment 172,500
Pre-operating cost 120,000
Total Capital cost 14,265,700
Working Capital
Raw material inventory 12,000
Cash 300,000
Total working capital requirement 312,000
TOTAL PROJECT COST 14,889,700
Table 9 - Project Returns

Description Equity Project
Internal Rate of Return (IRR) 38% 36%
Modified Internal Rate of Return (MIRR) 29% 28%
Pay back period (Years) 3 years
-----------------------------------------------------------------------------------------------
Net present value (NPV) Rs. 15 Million
Table 10 - Project Financing

Description % Amount in Rs.
Equity Financing 50 7,444,850
Debt Financing 50 7,444,850
Total 100 14,889,700
-----------------------------------------------------------------------------------------------
Statement Summaries SMEDA

Income Statement
Rs. in actuals
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Revenue 6,279,000 7,400,250 8,682,960 10,148,210 11,819,679 13,001,647 14,301,812 15,731,993 17,305,192 19,035,712
Cost of goods sold 2,862,700 3,253,717 3,691,742 4,182,236 4,731,284 5,159,792 5,628,715 6,141,950 6,703,777 7,318,897
Gross Profit 3,416,300 4,146,533 4,991,218 5,965,973 7,088,396 7,841,855 8,673,097 9,590,044 10,601,415 11,716,815
General administration & selling expenses

Administration expense - - - - - - - - - -
Rental expense - - - - - - - - - -
Utilities expense - - - - - - - - - -
Travelling & Comm. expense (phone, fax, etc.) - - - - - - - - - -
Office vehicles running expense - - - - - - - - - -
Office expenses (stationary, etc.) - - - - - - - - - -
Promotional expense 62,790 74,003 86,830 101,482 118,197 130,016 143,018 157,320 173,052 190,357
Insurance expense 36,800 33,120 29,440 25,760 22,080 18,400 14,720 11,040 7,360 3,680
Professional fees (legal, audit, etc.) 31,395 37,001 43,415 50,741 59,098 65,008 71,509 78,660 86,526 95,179
Depreciation expense 484,705 484,705 484,705 484,705 484,705 484,705 484,705 484,705 484,705 484,705
Amortization expense 234,967 234,967 234,967 234,967 234,967 - - - - -
Property tax expense - - - - - - - - - -
Miscellaneous expense 188,370 222,008 260,489 304,446 354,590 390,049 429,054 471,960 519,156 571,071
Subtotal 1,039,027 1,085,803 1,139,845 1,202,101 1,273,637 1,088,179 1,143,006 1,203,684 1,270,798 1,344,992
Operating Income 2,377,273 3,060,730 3,851,373 4,763,872 5,814,758 6,753,676 7,530,091 8,386,359 9,330,617 10,371,823
Other income 58,530 115,464 221,966 372,300 575,975 913,439 1,388,845 1,934,548 2,558,528 3,288,501
Gain / (loss) on sale of assets - - - - - - - - - -
Earnings Before Interest & Taxes 2,435,803 3,176,194 4,073,339 5,136,172 6,390,733 7,667,115 8,918,936 10,320,907 11,889,145 13,660,324
Interest expense 1,053,164 875,032 702,322 501,979 269,581 - - - - -

Earnings Before Tax 1,382,639 2,301,163 3,371,017 4,634,193 6,121,152 7,667,115 8,918,936 10,320,907 11,889,145 13,660,324
Tax 566,882 943,477 1,382,117 1,900,019 2,509,672 3,143,517 3,656,764 4,231,572 4,874,549 5,600,733
NET PROFIT/(LOSS) AFTER TAX 815,757 1,357,686 1,988,900 2,734,174 3,611,480 4,523,598 5,262,172 6,089,335 7,014,595 8,059,591
Balance brought forward 815,757 2,173,443 4,162,343 6,896,517 10,507,996 15,031,594 20,293,766 26,383,101 33,397,697
Total profit available for appropriation 815,757 2,173,443 4,162,343 6,896,517 10,507,996 15,031,594 20,293,766 26,383,101 33,397,697 41,457,288
Dividend - - - - - - - - - -
Balance carried forward 815,757 2,173,443 4,162,343 6,896,517 10,507,996 15,031,594 20,293,766 26,383,101 33,397,697 41,457,288
-----------------------------------------------------------------------------------------------

Balance Sheet
Rs. in actuals
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Assets
Current assets
Cash & Bank 500,000 800,659 1,765,210 3,167,370 5,105,968 7,693,478 12,605,175 18,258,039 24,731,913 32,124,268 40,953,532
Accounts receivable - 172,027 187,387 220,318 257,961 300,930 340,018 374,020 411,422 452,564 497,821
Finished goods inventory - - - - - - - - - - -
Equipment spare part inventory 1,342 1,585 1,864 2,183 2,549 2,810 3,098 3,415 3,765 4,151 -
Raw material inventory 120,750 142,636 167,740 196,492 229,375 252,886 278,807 307,384 338,891 373,628 -
Pre-paid annual land lease - - - - - - - - - - -
Pre-paid building rent - - - - - - - - - - -
Pre-paid lease interest - - - - - - - - - - -
Pre-paid insurance 36,800 33,120 29,440 25,760 22,080 18,400 14,720 11,040 7,360 3,680 -
Total Current Assets 658,892 1,150,028 2,151,641 3,612,122 5,617,933 8,268,503 13,241,818 18,953,899 25,493,352 32,958,291 41,451,353
Fixed assets
Land 1,066,533 1,066,533 1,066,533 1,066,533 1,066,533 1,066,533 1,066,533 1,066,533 1,066,533 1,066,533 1,066,533
Building/Infrastructure 9,517,620 9,136,915 8,756,210 8,375,506 7,994,801 7,614,096 7,233,391 6,852,686 6,471,982 6,091,277 5,710,572
Machinery & equipment 920,000 828,000 736,000 644,000 552,000 460,000 368,000 276,000 184,000 92,000 -
Furniture & fixtures 120,000 108,000 96,000 84,000 72,000 60,000 48,000 36,000 24,000 12,000 -
Office vehicles - - - - - - - - - - -
Office equipment - - - - - - - - - - -
Total Fixed Assets 11,624,153 11,139,448 10,654,744 10,170,039 9,685,334 9,200,629 8,715,924 8,231,220 7,746,515 7,261,810 6,777,105
Intangible assets
Pre-operation costs 1,174,835 939,868 704,901 469,934 234,967 - - - - - -
Legal, licensing, & training costs - - - - - - - - - - -
Total Intangible Assets 1,174,835 939,868 704,901 469,934 234,967 - - - - - -
TOTAL ASSETS 13,457,880 13,229,344 13,511,285 14,252,095 15,538,234 17,469,133 21,957,742 27,185,119 33,239,867 40,220,101 48,228,458
Liabilities & Shareholders' Equity

Current liabilities
Accounts payable - 27,099 30,789 34,842 39,293 43,596 46,328 49,253 52,386 55,744 42,230
Export re-finance facility - - - - - - - - - - -
Short term debt - - - - - - - - - - -
Other liabilities - - - - - - - - - - -
Total Current Liabilities - 27,099 30,789 34,842 39,293 43,596 46,328 49,253 52,386 55,744 42,230
Other liabilities
Lease payable - - - - - - - - - - -
Deferred tax - 188,600 188,600 188,600 188,600 188,600 150,880 113,160 75,440 37,720 (0)
Long term debt 6,728,940 5,468,947 4,389,514 3,137,370 1,684,884 - - - - - -
Total Long Term Liabilities 6,728,940 5,657,547 4,578,114 3,325,970 1,873,484 188,600 150,880 113,160 75,440 37,720 (0)
Shareholders' equity
Paid-up capital 6,728,940 6,728,940 6,728,940 6,728,940 6,728,940 6,728,940 6,728,940 6,728,940 6,728,940 6,728,940 6,728,940
Retained earnings - 815,757 2,173,443 4,162,343 6,896,517 10,507,996 15,031,594 20,293,766 26,383,101 33,397,697 41,457,288
Total Equity 6,728,940 7,544,697 8,902,383 10,891,282 13,625,456 17,236,936 21,760,534 27,022,706 33,112,041 40,126,636 48,186,228
TOTAL CAPITAL AND LIABILITIES 13,457,880 13,229,344 13,511,285 14,252,095 15,538,234 17,469,133 21,957,742 27,185,119 33,239,867 40,220,101 48,228,458
-----------------------------------------------------------------------------------------------
- - - - - - - (0) 0 (0) 0

Cash Flow Statement
Rs. in actuals
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Operating activities
Net profit - 815,757 1,357,686 1,988,900 2,734,174 3,611,480 4,523,598 5,262,172 6,089,335 7,014,595 8,059,591
Add: depreciation expense - 484,705 484,705 484,705 484,705 484,705 484,705 484,705 484,705 484,705 484,705
amortization expense - 234,967 234,967 234,967 234,967 234,967 - - - - -
Deferred income tax - 188,600 - - - - (37,720) (37,720) (37,720) (37,720) (37,720)
Accounts receivable - (172,027) (15,360) (32,931) (37,643) (42,969) (39,088) (34,002) (37,402) (41,142) (45,256)
Finished good inventory - - - - - - - - - - -
Equipment inventory (1,342) (243) (279) (319) (365) (261) (288) (318) (350) (386) 4,151
Raw material inventory (120,750) (21,886) (25,104) (28,752) (32,883) (23,511) (25,921) (28,578) (31,507) (34,736) 373,628
Pre-paid building rent - - - - - - - - - - -
Pre-paid lease interest - - - - - - - - - - -
Advance insurance premium (36,800) 3,680 3,680 3,680 3,680 3,680 3,680 3,680 3,680 3,680 3,680
Accounts payable - 27,099 3,690 4,053 4,451 4,303 2,731 2,925 3,133 3,359 (13,514)
Other liabilities - - - - - - - - - - -
Cash provided by operations (158,892) 1,560,652 2,043,985 2,654,302 3,391,085 4,272,394 4,911,697 5,652,864 6,473,874 7,392,354 8,829,265
Financing activities
Change in long term debt 6,728,940 (1,259,992) (1,079,434) (1,252,143) (1,452,486) (1,684,884) - - - - -
Change in short term debt - - - - - - - - - - -
Change in export re-finance facility - - - - - - - - - - -
Add: land lease expense - - - - - - - - - - -
Land lease payment - - - - - - - - - - -
Change in lease financing - - - - - - - - - - -
Issuance of shares 6,728,940 - - - - - - - - - -
Purchase of (treasury) shares - - - - - - - - - - -
Cash provided by / (used for) financing activities 13,457,880 (1,259,992) (1,079,434) (1,252,143) (1,452,486) (1,684,884) - - - - -
Investing activities
Capital expenditure (12,798,988) - - - - - - - - - -
Acquisitions - - - - - - - - - - -
Cash (used for) / provided by investing activities(12,798,988) - - - - - - - - - -
NET CASH 500,000 300,659 964,551 1,402,159 1,938,598 2,587,510 4,911,697 5,652,864 6,473,874 7,392,354 8,829,265
Cash balance brought forward 500,000 800,659 1,765,210 3,167,370 5,105,968 7,693,478 12,605,175 18,258,039 24,731,913 32,124,268
Cash available for appropriation 500,000 800,659 1,765,210 3,167,370 5,105,968 7,693,478 12,605,175 18,258,039 24,731,913 32,124,268 40,953,532
Dividend - - - - - - - - - - -
Cash carried forward 500,000 800,659 1,765,210 3,167,370 5,105,968 7,693,478 12,605,175 18,258,039 24,731,913 32,124,268 40,953,532
10. KEY ASSUMPTIONS
Table 11 - Project Capacity Assumptions
Calculation
Description
Number of huts 08
Number of business days 180 (6 months)
Total assumed capacity 08*180 = 1440 Units
Capacity utilization 1st year 70%
Growth in capacity utilization 30%
Maximum attainable capacity 100%
Table 12 - Revenue Assumptions
Calculation
Description
Hut rent/night Rs. 4,000
Rent growth rate/year 10%
Yearly income form kitchen contract Rs. 600,000
Yearly income from hall rental Rs. 400,000
1st year revenue from hut rental 6,000*(1,440*0.70) = Rs. 6,048,000
1st year total additional income 600,000 + 400,000 = 1,000,000
Table 13 - Economic Assumptions
Calculation
Description
Electricity price growth rate 6%
Gad price growth rate 6%
Water price growth rate 6%
Salary growth rate 10%
Table 14 - Expense Assumptions
Calculation
Description
Communication expense 15% of administration expense
Promotional expense 4% of administration expense
Professional fee (legal, audit etc.) 1% of revenue
Administration benefit expense 3% administration expense
Operational cost growth rate 5%
Machinery & equipments insurance rate 5%
Table 15 - Financing Assumptions
Calculation
Description
Debt 30%
Equity 70%
Long term debt interest rate 16%

Pre-Feasibility Study: Beach Resort

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Pre-Feasibility Study

Small and Medium Enterprises Development Authority

REGIONAL OFFICE REGIONAL OFFICE REGIONAL OFFICE REGIONAL OFFICE

Document No. PREF-31

6.4 Human Resource Requirement .................................................................................................... 16

2. PURPOSE OF THE DOCUMENT

3.5 Project Capacity and Rationale

Table 1 - Project Investment Summary

Human Resource Location

3.9 Key Success Factors/Practical Tips for Success

over the world, the Ministry in collaboration with its component

4. CURRENT INDUSTRY STRUCTURE

4.3 Tourism in Pakistan

o Gwadar International Airport

No. of Units Price/Unit Total (Rs.)

Table 3 - Office Equipment Details

Qty Cost/unit Total (Rs.)

Table 4 - Furniture & Fixture Details

Total cost (Rs.)

6.3 Furniture and Equipment Maintenance

8.1.3 Develop a Business Plan

8.1.8 Advertise & Market

9. ANNEXURE – FINANCIAL STATEMENTS

Table 8 - Project Cost

Table 9 - Project Returns

Net present value (NPV) Rs. 15 Million

Table 10 - Project Financing

Statement Summaries SMEDA

General administration & selling expenses

Interest expense 1,053,164 875,032 702,322 501,979 269,581 - - - - -

Statement Summaries SMEDA

Liabilities & Shareholders' Equity

Statement Summaries SMEDA

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