The purpose of the business is to start up a travel agency dedicated to offer travel alternatives for low income families. The values that fundament the spirit of our company is to constantly help low income families to increase their life quality.
We have come out with this idea considering that people with limited income in Ecuador and Colombia normally don’t have an alternative for making a break on their normal routine and dedicate quality time to enjoy with their relatives. From our social perspective we consider not just that only people belonging to middle and high class have the right to visit other countries and cultures and dedicate a decent time to enjoy with their families.
In order to achieve our objective, we have made a deep market research and have identified that the only manner to make our project feasible is by generating sales around six touristic packages per country, three of them dedicated to promote domestic tourism and the other 3 oriented to promote tourism between the countries where we plan to start the operation.
As it is known in the tourism industry, the best way to reduce costs is in the case of air fares by chartering airplanes and in the case of all inclusive hotels by generating sufficient volume in terms of number of nights spent.
In order to secure the volume required to make our business possible, we have identified 4 strategic low income groups:
- Policemen are the first target segment to be approached. Low raking policemen usually cannot afford to pay vacation trips
- School Teachers are our second target and is also a segment for whom is difficult to spend money on vacation
- The third strategic group is the varsity high school students. Normally, high school students from medium and high class institutions travel prior its graduation to different countries as a commemoration of the time spent in high school. However, low income students normally do not have the possibility to life this experience considering that touristic packages in Colombia and Ecuador are expensive
- Public workers belonging to the municipalities and public utility companies normally do not spend time on vacations due to the level of their salaries.
The reason behind our selection of the above mentioned groups is the possibility of creating a vacation saving fund and on the other hand, once interested persons have committed on a certain touristic package, the identified segments give us the possibility to irrevocably deduct from the salary earned in 18 monthly installments (or levy on the monthly educational fees in the case of the students) a specific amount dedicated to finance their vacation time.
Other business streams
In order to support some customers, specially high school students with limited economic possibilities, we have decided to create a second business stream which will be dedicated to sell international airplane tickets to multinational corporations.
Our market research, established that corporations normally pay over 20% of the real cost of an airplane ticket due to the fact that they normally use local travel agency that book high cost airfares with the purpose of increasing their commissioning revenues.
Being this said, we are planning to provide companies an online platform that allows them not only to book tickets but also permits them to reserve hotel rooms, buy transportation services and offers travel insurance alternatives for their employees.
Destination of funds to be raised
Funds to be raised will go directly to secure hotel reservations and flight charters for the first groups of low income tourists travelling in the next vacation season which will starts on June 2014.
Following we show the calculation that supports the destination of funds:
International Hotel Reservation for 120 pax à 21,600 x 2 countries = 43,200
International Airplane chartering for 120 pax à 15,000 x 2 countries = 30,000
National Hotels Reservation for 120 pax à 19,800 x 2 countries = 39,600
National Airplane chartering for 120 pax à 5,000 x 2 countries = 10,000
Equity invested by founders
Founders will be investing US$30,000 dedicated to maintain the selling administrative department during the first 6 months of operations, where limited revenues will be flowing to the company.
Estimating pay-back time
Payback time of money raised will be 36 months. Escrow agent will be appointed in order to secure the destination of funds raised and money paid by the customers.
Experience of founders
Founders worked in the past in the financial and commercial department of Aerogal Airlines in Ecuador, which allow them acquire sufficient experience in the touristic markert. Founders works also adivising leisure companies.
Work experience of each founder is over 10 years.
Further information can be provided by requesting it to the following email Addresses
1) Abraham Ulloa --- Phone 593.999.445.459 Email [email protected]
2) Carlos Chavez --- Phone 593.999.242.263 Email [email protected]