Amber van de Laar Dennis van Rijt Freek Ross Iñaki Laucirika Sven Vossenberg
Contents Management summary ............................................................................................................ 1 Project location ........................................................................................................................ 1 Market analysis ........................................................................................................................ 1 Marketing strategy ................................................................................................................... 1 Financial plan ............................................................................................................................ 1 1. Introduction and methodology description ................................................................ 2 2. Water Park industry and the current trends ................................................................ 3 Benchmark analysis .................................................................................................................. 3 Water Park trends .................................................................................................................... 4 3. Market analysis .................................................................................................................. 5 Location .................................................................................................................................... 5 Target group ............................................................................................................................. 6 Resident market analysis ......................................................................................................... 6 Resident market economic analysis ........................................................................................ 8 Age distribution in the resident market .................................................................................. 9 Tourist market analysis ............................................................................................................ 9 Competition analysis .............................................................................................................. 10 Attendance projection analysis ............................................................................................. 12 SWOT analysis ........................................................................................................................ 14 4. M arketing strategy ................................................................................................... 16 Core concept ........................................................................................................................... 16 Pricing ..................................................................................................................................... 17 Staffing .................................................................................................................................... 18 Promotion ............................................................................................................................... 18 Future development and the tourist market ........................................................................ 18 5. Financial Plan ................................................................................................................... 19 Revenue Analysis .................................................................................................................... 19 Cost Analysis ........................................................................................................................... 20 Profit & loss / ROI analysis ..................................................................................................... 21 6.
General conclusions and recommendations ..................................................................... 22
APPENDIXES ................................................................................................................................ 23 References .............................................................................................................................. 36
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Management summary Included in the development plans of the metropolitan Bilbao, the Sestao city is planning the redevelopment of an old shipyard and industrial area into a leisure and business area. The investor committee is looking for attractive leisure projects that stick to the following guidelines: leisure related, some relation to local heritage, initially destined to local market and medium range market and unique in the area. After researching the current offer, our proposed project will be a themed indoor Water Park.
Project location It is a well-‐connected area with subway, bus and direct connection to the main freeway network. The area already offers a shopping mall that attracts around 18 million yearly visitors, showing the suitability of the area for a high density attraction. Local governments are interested in developing businesses and they offer interesting subsidies in both land and labour expenses.
Market analysis With a projected catchment area of up to 2h driving time, the reachable market is composed of around 4 million people, with 1 million living less than 30 minutes from the site. The per capita rent (30.000€) as well as the living quality is the highest in Spain (average 22.300€) and shows a healthier economy than that expected in Spain. Although, the economy is in a good state, due to a low birth rate and the ageing of the population, the area is expected to lose 2,5% of its inhabitants by 2022. Tourists, will also be part of our market, limited to the ones coming to the area for summer holidays in the beach areas. The tourist penetration in this market will be around 1-‐2%. Direct competition will be negligible, limited to local pools and two small spas in the area. There are also other leisure activities and two zoos within short driving distance. But we believe that more than a threat, they provide opportunity for a multi activity day out for families in our catchment area. The average market penetration will be around 6%. Higher within 30 minute drive time and lower around the two hour mark. With an estimated figure of around 240.000 average visitors per year.
Marketing strategy The Water Parks biggest challenge will be offering a broad variety of activities and experiences destined to be attractive to ages ranging from 3-‐65. With an initial investment towards a younger age visitors and yearly developing the Water Park to be more attractive to older audiences. By doing this we plan to balance the projected loss and ageing of population. The pricing will be stablished by age ranges, and based on the market research will have an average admission price of 14.95€. It is also expected that at least 20% of the visitors will purchase a seasonal ticket. We also recommend focusing on secondary spending as it is a challenge currently faced by many Water Parks.
Financial plan By following the recommendations of the marketing strategy and taking into account the current market, with a recommended initial investment of 16.000.000€, as a base case scenario, we expect an average per capita spending of 22.5€, 70% admissions, 15% F&B and 5% coming from merchandise and other revenue sources. In the base case scenario the break even rate is expected to be 10 years with a return on investment of 68% in 20 years. Still with positive numbers, our worst case scenario shows a lower per capita spending of 18.5€ and a lower market penetration. This will cause the break even rate to be 15-‐16 years with a ROI of 26% in the first 20 years.
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1. Introduction and methodology description The metropolitan area of Bilbao has always been known as a high density industrial area, related to ship building and iron mining. But in the last decades, the area has seen many developments in terms of culture and leisure equipment. The local governments have seen great value in transforming the area into a tertiary service and entertainment area. Inside the scope of these development plans, the Sestao municipality, located inside the metropolitan area, is also planning to transform a former shipyard and a former industry cluster into a business, leisure and service industry area. Seeing it as an opportunity to provide a unique leisure offer in our market, we set to propose our own idea and its feasibility study to the development committee, formed by various investor firms that will be in charge of financing the project. Starting with the location, which was already specified, we looked into the market around and the current offer of leisure attractions available in the area. Early in the process, it was stablished that our offer should be oriented to the local market and short range market, it should be a product that is connected to the heritage of the area, it should be unique in the area and above all, it should be linked to the consuming habits of the local population. Following those rules, and by running an in depth analysis of the current offer and the consuming habits of the available market, we soon stablished that an indoor Water Park could be an interesting attraction for the area. Although, there are already multiple Water Parks in Spain, they are all located in holiday destinations over 5 hours away, and are limited to the summer season. An indoor Water Park matched all our requirements, it can be targeted to the local market, but can also be expanded in the future to become an attractive offer for a broader market, it can be themed to an idea connected to the local heritage, it is unique and water activities are highly regarded in this area of Spain, where the historical connection with the sea is high. Once we stablished that an indoor Water Park was our preferred leisure facility to develop, we started researching if the market in the area was suitable to support the future operation of this kind of attraction. In order to get a realistic snapshot of the situation, we made use of the multiple resources available from local, national and European governments, previous studies from various consultancy agencies and international industry associations. Finally, after doing the market research and once an outlay of the marketing strategy was stablished, we developed an 8 year financial forecast by using benchmark figures offered by the industry in Europe and our own findings about our future market, in order to prove the financial viability of the project.
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2. Water Park industry and the current trends In the following section, by presenting benchmark data and trend analysis, we offer an overview of the current state of the Water Park industry in Europe. Nowadays, in Europe, a different selection of Water Parks can be observed. Second gates of regional or international destination theme parks, like Portaventura and Costa Caribe or the projected Water Park in Europa Park. Standalone Water Parks, mainly found in Spain and Mediterranean areas. Standalone indoor Water Parks, an important trend in northern Europe, where the weather doesn’t allow for an outdoor operation. For example Alpamare Water Parks. Or finally Water Parks that are part of an accommodation resort. Continuous development, describes in two words the current Water Park industry state in Europe. With new Water Parks opening in Spain, Germany or the UK or new improvements that add to the entertainment value of the currently available parks. It is important to note the good network of suppliers available in Europe, where some of the world´s most renowned suppliers are located. From slide manufacturers to companies researching the use of new media, mobile and wireless technology on Water Parks. This shows a healthy industry where Water Parks are closely connected to the suppliers. In the next section we outlay some of the current economic and attendance data from European and world Water Parks.
Benchmark analysis Water Parks form an industry that, in Europe, attracts more than 76.4 million visitors a year and generates more than 848€ million in revenues. The European market is composed of around 188 Water Parks with a current trend of opening new ones. It is also important to note that the direct and indirect economic impact of Water Parks generate more than a 1.760 million euros and employ more than 35.800 people. Beneath a short list of the top Water Parks in Europe can be found. Industry associations conclude that the main target of the Water Parks are young people and children aged 3-‐17, followed by adults age 25-‐49. This shows that the main users of Water Parks are families with teenagers and children. The majority of Water Parks generate these visitors from the local market, especially indoor Water Parks. Guests usually spend around 6 hours in a Water Park. The average per capita spending of the visitors is 28€. The most important part of that number comes from admissions and the rest from secondary spending, like merchandise, F&B or other services like parking, dryers or extra activities. Secondary spending is still a big challenge for this industry due to the fact that people walk around in swimsuit and money handling can be difficult in that case. When it comes to Spain, the industry is well rooted with an offer of over 30 Water Parks. But the geographic distribution shows a clear trends towards building the Water Parks in Mediterranean coast destinations or big cities like Madrid. They boast over 12 million visitors a year, providing a direct effect on the local economy of around 300€ million. It is also important to note that around 14% of the Spanish population visits a Water Park during the year. Most of the European Water Parks do not have a theme. If they have, most of the time it is a tropical theme. We try to be unique by creating an industrial indoor Water Park that is taken over by nature.
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Overall, this brief look at the current Water Park market, shows a rich industry that is growing, with over 5 new and projected Water Parks in Europe, two alone in Spain. And, although, it still has to face various challenges, by the using new technologies that are being researched and developed Water Parks will continue to be an interesting leisure offer.
Water Park trends In this short and final section relating to the Water Park industry we look at some of the current trends in Water Park development. Indoor Lately, indoor Water Parks are becoming an important trend. More often slide parks and pools are built in an indoor environment. Thanks to their weatherproof characteristics they are becoming an interesting asset in the rainy areas of Europe. By providing a covered area, parks have the opportunity to enjoy a longer season. Combinations Due to a space limitation, most of the time it is difficult to expand and add new offer. Therefore, another notable trend is the mix of outdoor Water Parks with indoor areas. With an outdoor area the summer season can be enhanced. And there is additional space to offer new experiences. Variety It is becoming more and more important to have a varied offer for all age brackets. Aside from thrilling slides, whirlpools, saunas and complete wellness centres are being offered. By improving the variety Water Parks are trying to appeal to a wider market and improve their penetration in their influence area. Uniqueness Competition is fierce in the Water Park industry, to stand out Water Parks are turning to suppliers. By designing unique slides like water loops, half pipes or even water rollercoaster! The more unique the offer in the park, the bigger your market penetration becomes. In this area it is also important to mention a new trend relating to interactive and media related experiences that are currently being developed for Water Parks. Making use of new technology to enhance the experience. Like 3d simulators inside Water Parks or the use of wireless technologies to improve guest experience, as can be the new RFID wristbands that are being introduced.. Theming Theming for Water Parks is also becoming an important trends as a means of creating a unique experience. Tropical theming in Water Parks is a very famous cliché. But aside from that new themes are being developed, like futuristic environments, industrial or themes based in ancient civilizations. Storytelling Storytelling is also a new area that is being developed by operators. For instance a story about an anaconda. After the preshow which will get you excited, you get to race against your friends in the slide.
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3. Market analysis Location Before researching the market in the selected location we stablished some basic criteria that had to be met in order to consider our location feasible. The site should: Be close to a major road. Have easy access to the public transport and optionally to an airport. Have space for further expanding. Be large enough to offer space for parking, at least a 6000m2 building and free space for an outdoor area. -‐ Be in a well stablished and attractive area. -‐ Not be in an industrial area or to be in an area being redeveloped. The Location -‐ -‐ -‐ -‐
The location selected for our development is located in the autonomous community of the Basque Country, province of Biscay and city of Sestao. (Area map available in appendix 1) The local government is already searching for leisure activities to transform the industrial area called “Ibarzaharra” into an area filled with leisure, commercial and business offers. Due to this plans, the local governments have appointed a group of investors to look for companies that want to develop the area. In order to be more attractive they are offering subsidized land (84.94-‐100€ m2), which gives an interesting opportunity. The lot we are looking at is a 40.000m2 area which previously was part of a shipping company and a high density industrial area. The ground has been cleaned by a local government contractor and is ready to be developed. Close to the area there is an existing big shopping mall that already attracts around 18 million people every year. This is really an interesting opportunity because the visitors of the mall can combine it with a few hours of water fun and relaxing at the swimming pools and slides a minute away from the shopping mall. The fact that this shopping mall already attracts lots of visitors also helps us understand that this area of Bilbao already is a popular and reachable leisure destination. We believe that we can also collaborate with the mall by adding an attractive offer that will attract more visitors to the area, by combining shopping or cinema in the afternoon with a morning in the Water Park. Access to the location As can be seen in many studies, conducted by industry associations, the car is still the main transportation method for visitors to parks. Our site is within 1 minute from the main freeway of the Basque Country and northern Spain, the A8. It provides direct connection with the rest of Spain and fast connection with all the cities around. The lot is also close to the Urbinaga and Galindo Metro Stations and the Adrian Celaya road Bus stop. The walking distance from the metro is around 15 minutes and once they redevelop the Galindo station it will go down to 1-‐5 minutes as it will be integrated in the redeveloped area. The Bilbao subway connects various cities with a total population of around 800.000. This provides easy transportation for teenagers that cannot yet drive. Bilbao also has an airport close, located within a 15 minute drive by car. From the airport you can fly mainly to other Europe countries and interesting holiday destinations, for example Ibiza. It is an important transport system that may be useful in future development strategies.
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First we will focus on the indoor part of the project and a small outdoor green area. After a few years we may want to expand to a bigger outdoor area for future enjoyment. Looking to the allocated space there is enough land for some future developments. Next to the building there is also enough space for a parking lot and within a 5-‐10 minute walk you will find the shopping mall parking lot. It is also an interesting idea to provide a well visible path from the shopping mall to the Water Park. This should be an idea to consider and discuss with the local government responsible for the urban planning. In conclusion, it can be said that the location is easy to reach for public of all ages. There is also the possibility of an agreement with the public transportation company, to arrange a special bus line that can travel from the main destinations, for example area hotels, the airport, or from the shopping mall nearby to the location, to offer a faster connection between both of them. (Weather information available in appendix 2) After providing the necessary information about the location, we proceed to show a picture of the current state and the different possibilities that the market around our projected location offers. We chose to divide the market into two segments, residential market and tourist market. But first of all, we will provide a short description of our intended target group.
Target group Following the current trends in indoor Water Parks, we are aiming to offer a product that can be enjoyed by a broad audience. We are mainly interested in the local community (within 60 minutes of driving time) and with ages ranging from 3-‐70. We believe, as will be proved in the market analysis, that the ageing of the population will be an important factor in the future. After the initial investment, the aim should be to invest in well-‐defined product offers for five different age groups, 3-‐11, 12-‐18, 19-‐40, 40-‐60 and 61+, and to start providing a good offer for tourist and visitors driving more than 2 hours.
Resident market analysis In this part of the study we focus on the resident and tourist market around the site selected for the development of the indoor Water Park. The available market and its characteristics will help stablish a base for the calculation of the projected attendance figures. While analysing the resident market various factors have to be taken into account. Distance from the site is the first one that needs to be considered in order to stablish an adequate visitor catchment area. Looking at previous studies, the expected primary catchment area, for an indoor Water Park, is considered to be around 80km, which translates to an average of 1 hour driving time. It is also known in the industry, that for this kind of attraction, visitors are willing to travel no more than the equivalent of 25-‐50% of the time they will spend in the park. Our projected Water Park is expected to offer a 3-‐5 hour experience depending on the season. In our case we have designed a 3 catchment area plot, being 30 minutes our primary area, consisting on the visitors that will attend regularly. The secondary catchment area extends from 30 minutes to 1h of driving time and amounts for the visitors that will visit the park and possibly return and finally the tertiary catchment area, from one hour to the two hour mark. This last group will visit the park, but the market penetration will be notably lower than the previous two zones. The results of the survey can be seen in figure 1.
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After generating the plot and gathering the statistical data relevant to each catchment area, the results show that 1 million people live within 30 minutes of driving time, 1.6 million within 1 hour and the population within the 2 hour driving time increases to 3.9 million, including 278.540 from the neighbouring France. The increase in population within the 2 hour drive time stands out, and by researching current Water Park benchmark figures offered by industry associations we expect around 28% of the visitors of the park to come from areas further than 1 hour and 30 minutes. This presents a great opportunity to market ourselves effectively as an exclusive attraction in the area. We will further analyse these numbers in the projected attendance analysis.
Figure 1 source: INE, EUSTAT, INSEE and MapPoint
Another important factor to be taken into account is the projected evolution of the market population. Due to all the local governments not offering future predictions, we have created a benchmark figure in order to calculate the market population evolution, using forecasts for the regions that affect our catchment area, Region 2014 2020 % Basque Country 2159460 2063789 -‐4,4% Navarra 635604 616376 -‐3,0% Cantabria 587780 573748 -‐2,4% La rioja 316242 300228 -‐5,1% Pyrénées-‐Atlantiques 673.000 695.000 3,3% Avg. Population (benchmark figure) -‐2,33% variation (%) Calculated market 3.914.025 3.822.924 -‐91.101 projection Source: INE, EUSTAT, IEN and INSEE (based on 2h drive The catchment)
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results show a negative growth in terms of population (-‐2.33%), which will present a challenge for the Water Park. When attempting to increase visitor numbers, the need to open up to new markets instead of relaying in the local market will be an important factor in the future development plan of the park. Requiring room for future improvements and additions that will attract visitors outside the current catchment area or improve the market penetration.
Resident market economic analysis Aside from the number of population, Per Capita income is another important factor while studying the current available market. Historically, and as noted by other industry consultancy agencies, Water Parks are more attractive to middle class and lower class families. In Spain, for statistical matters, A family with an annual per capita income of 20.000€ to 60.000€ is considered middle class. The Spanish per capita income currently stands at 22.300€, on the other hand, the Basque Country, is in a better economic situation, with a Per Capita income of approximately 30.000€, It stands as the richest autonomy inside Spain. In the following table the average Income per capita is calculated, both based in data provided by the municipalities and general data from other government entities.
1 hour 2 Driving time 30 minutes hours Per capita 42.631 € 37.309 € 36.356 € income Source: EUROSTAT, INE, EUSTAT
As the table shows, the per capita income level in the marketable area is considerably high comparing it to the current national threshold. Even though, this is an important marker to describe the current economic situation, it is also necessary to analyse how the local market is using this purchasing power. Knowing this we will be able to provide a more tailored pricing policy that will be both adequate to generate revenue and to be attractive for the market. When it comes to budget per capita and spending habits of the market, the official data states that the average budget per capita in the overall Spanish leisure and sports service industry (which includes Water Parks) is 76.78€. In contrast, the Basque country’s average yearly per capita budget raises up to 124.08€. The same happens when you look at the results of the neighbouring communities ranging from 145.48€ in Navarre to the lower 69€ from Cantabria. This data shows that our future market, has a larger budget dedicated to the leisure industry than the Spanish average figures. It is also important to note that, although, per capita budget for overall culture and leisure activities decreased from 2012 to 2013, figures for leisure and sport services were the only ones to witness an average growth of 11%. When it comes to unemployment figures, Biscay, which is the province were our projected Water Park is located, with a 14.1% unemployment rate, has the lowest figure in Spain (26.1%). The conclusion that can be drawn, from the economic analysis of our residential market, is the notable higher quality of life, spending per capita in leisure time, overall higher income level than the rest of Spain and a lower rate of unemployment. This shows an overall healthier economy in the area of Spain were our market is located.
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Age distribution in the resident market Age is another key factor when studying the market around our attraction. Researching the available age market in the proposed area, will help in further improving the attendance projection figures by stablishing a more in depth market penetration analysis. In table X the final results of the research can be seen. 0-‐4 5-‐9 10-‐14 15-‐19 20-‐24 25-‐34 35-‐44 45-‐54 55-‐64 65+ Total
30 minute drive 60 minute drive 120 minute drive 45856 4,6% 33131 5,1% 111725 5,0% 45124 4,5% 33767 5,2% 110902 4,9% 40789 4,1% 27517 4,2% 104936 4,7% 38392 3,8% 25544 3,9% 100257 4,5% 42878 4,3% 28105 4,3% 106997 4,8% 127302 12,7% 86485 13,2% 274346 12,2% 166201 16,6% 109806 16,8% 366020 16,3% 158945 15,9% 100299 15,3% 340928 15,2% 129718 12,9% 82887 12,7% 285758 12,7% 206481 20,6% 126029 19,3% 442186 19,7% 1001686 100,0% 653570 100,0% 2244055 100,0% Source: Eustat, INE, INSEE
The results clearly show that the area is following the current widespread trend in western countries, population is growing old. With a rate of 1.35 children per woman the Basque market demography is very similar to countries like Germany (1.36), but, still, lower in birth rate numbers than countries like France (2). This shows that the birth rate is decreasing. The average age of our resident market is 42, just 0.1 point higher than the European median age of 41.9. The age distribution also follows the European average demographics. (Age pyramid available in appendix 3)
Tourist market analysis
Although, following general industry knowledge, indoor Water Parks have an approximate market penetration of just 1-‐3% among the tourists, we believe that it is an important factor to be considered in the Basque country. Knowing this and to get a realistic prediction, we don’t expect tourist staying further than our primary catchment area to visit the Water Park as a tourist activity. This is why we will focus on the tourists in the Basque Country (within the 60 minute drive area), which amounts to 2.600.782 unique visitors in 2013. The activity offer in this area is varied and attracts many different kinds of tourists. Lately, Bilbao has become an important cultural hub, with various museums and activity centres. Aside from city exploring, the Biscay area also offers rural destinations for overnight stays in constant touch with the nature. Finally, beach and summer holiday is also, to a lesser extent than in other parts of Spain, part of the activities. But short breaks to explore the main cities and routes around smaller towns still make up for 61% of the activities carried out by visitors. To provide a more accurate count of the visitors that would possibly be interested to visit a Water Park as part of their holiday in the Basque country we have decided to only take into account tourists staying overnight and that are mainly interested in leisure holidays (Beach stays and weekend leisure breaks). We consider that the profile of the visitor that seeks a cultural experience in the area does not fit with a leisure attraction of the type we are planning to offer.
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It must be mentioned that the evolution of the tourist market has been positive and steady since the 90s (average growth of 4.8% yearly since 1992). Mainly due to the important efforts put by the local governments, redeveloping old high density industrial areas into cultural and social destinations. Business tourism is also in the development plans of the area investors, with two new facilities, a 251.000m2 trade show facility and a 4200 seating conference centre. Our offer being unique in the area, no information is available in terms of possible visitor numbers to a specially designed leisure facility. Due to this, we are limited to use information from other Water Parks in the Europe region in order to stablish a market penetration benchmark figure for the tourist market in the area.
Competition analysis Even if our catchment area is two hours we decided to analyse the competitors within a drive time of three hours. Due to our varied offer for all different ages, it was hard to define important competitors. For example, our Spa-‐facility is basically targeting people without kids or older people. When looking at targeting older people, the main competitors are Museums or other Spa’s. Adults without children usually will be attracted by as well Museums and Spa’s, but also by more physical activities. Our indoor Water Park itself, containing several pools and slides, both indoor and outdoor, is mainly focused on teenagers or parents with their children. The main competitors for these target groups will be basically other Water Parks or Theme Parks, but also zoo’s or interactive attractions, and of course the more physical activities like high rope courses, laser gaming or karting. Additionally, despite the presence of a big shopping mall nearby which is seen as an opportunity for us, shopping malls must also be considered as competition. On the next page are the biggest competitors, most of them found on the internet, but also the team’s knowledge of the area helped defining some of competitors. (Map available in appendix 4) In terms of Water Parks, we can distinguish two categories, which can either be indoor or outdoor: -‐ Fully featured Water Parks. They usually contain a lot of thrilling slides, but also several pools. For example with waves or with fountains. Of this type, there is only one big Slide Park within a drive time of three hours: o Aqualand Bassin d’Arcachon, located in the South-‐West of France. During their 2014-‐season (June 21st – September 3th) 180,000 people visited this outdoor Slide Park. Because of the large amount of slides with length restrictions, the admission fee is based on lengths: § < 0,90m Free § 0,90m – 1,10m € 10,00 § 1,10m – 1,40m € 18,50 § > 1,40m € 26,00 Aqualand Bassin d’Arcachon both targets on tourists and the local inhabitants.
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Swimming pools. Swimming pools usually include a (few) pool(s) with a large green area where people can enjoy the sun. The admission fee is low, causing many people to go there on a sunny day. People won’t really drive many hours for just a simple pool, so we only analysed two nearby swimming pools that also offer slides: o Hernani public pool, located in San Sebastian, 75 km to the east of Bilbao. The Hernani public pool only contains one swimming pool with a few small slides, and a huge grass area where people can enjoy the sun. There is also a soccer field, a basketball field, and a ‘beach ‘volleyball field on the location. Because it is an outdoor only pool, it opens from June 14th until September 7th. Admission fees are low: § < 3 years € 2,40 § 3 – 18 years € 5,00 § > 18 years € 7,30 o Local pools from Vitoria. Vitoria is a city containing two public pools, around 60 km to the south east of Bilbao. Both public pools only consist of a few pools, small slides and a grassy area. These local pools are opened during the summer: May 31st until September 7th. Due to the entry fees it looks like the main target group of these pools are teenagers: § < 4 years € 0 § 5 – 17 years € 1,20 § 18 – 25 years € 3,50 § > 25 years € 5,90 These pools are able to keep the entry fees this low, because they are public pools, which means they get support from the local government. This low entry fees also explain the quite large number of visitors: around 600.000 in 2011. After having analysed the local pools around our site (which include at least one or two per city depending on the size), we believe there is enough offer of non-‐leisure pools. This is why we believe that we have not enter the market of competition and sport pools: public pools have to be easy accessible. Our pricing is too high to appeal as an everyday sports pool. Looking at competitive zoo´s we only see 2 real zoos, and one midway attraction in the centre of Bilbao: -‐ Getxo Aquarium is a midway attraction, located in Bilbao. The aquarium attracted only around 22.000 visitors in 2009. -‐ Karpin Abentura. This is a large wildlife zoo/ecological/educational park, 20 km to the west of Bilbao. Visitor numbers are unknown, but because of the educational status, it will attract a lot of parents with children. Due to the large natural area, older people may find their way to Karpin Abentura as well. It also offers high rope courses for teenagers. -‐ Cabarceno Natural Park is a zoo/safari, 50 km to the west of Bilbao. The area it covers is large: about 750 hectares. All kind of wildlife species are part of their exhibition. In 2010 Cabarceno Natural Park received 500,000 visitors. -‐ Sendaviva is a zoo with 30 rides and over 800 animals, located 160 km to the south-‐ east of Bilbao. It attracted 157,777 visitors during the summer season of 2012. Museums, although not direct competition, should also be considered as completion. In Bilbao the main museums are the Guggenheim museum and the “Bellas artes” museum. The first one, attracted around 931.000 visitors in 2013. The second one received around 295.000 visitors in 2012. The average admission price for museums in Bilbao is 6€. -‐
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We also looked at the three main Theme Parks in Spain when making the competitive analysis: -‐ Parques de Atracciones de Madrid (2,200,000(2008)) +/-‐ 4 hr drive time -‐ Parque Warner Madrid (1,200,000(2011)) +/-‐ 4 hr drive time -‐ Port Aventura (3,540,000(2012)) +/-‐ 5 hr drive time These three Theme Parks are not located in our 3 hour drive time area, but due to their visitor numbers and attractiveness we consider them as competitors that will make people leave during the holiday period. Around the city of Bilbao are smaller attractions (Karting, Laser gaming, Shopping, public Sport facilities, Museums, City Trips, Etc.) that people will visit, but the above seem to be the most important competitors to us.
Attendance projection analysis Provided that our proposed indoor Water Park is unique in the area, the calculation of the market penetration was done based on information offered by various consultancy agencies and benchmarking data provided by IAAPA. We also made various assumptions based on the type of facility we are offering. Taking into account our target group and the product offer we are planning, we have created a table of penetration values per age bracket and drive time. Water Parks are well stablished, leisure time, destinations in Spain. In 2011 14% of the population visited a Water Park during their leisure time. We believe that being a unique attraction in a densely populated area, we can reach over 14% of our local public. Taking this into account and using data from other project developments we consider our base penetration figure to be 16%. From this base percentage the attractiveness perception that different age brackets will have has been deducted. With a mixed offer of slides, recreational waves, children area and wellness space we believe that all the age brackets will find it interesting. But, by integrating our Water Park among the offer of the nearby shopping mall we can also become an interesting destination among families that want to leave their children in the Water Park while shopping. This is why penetration values will be higher in the 0-‐13 and 35-‐45 age brackets. It is also essential to note that the driving time is an important part of the attendance projection. The longer the drive time the less attractive the offer becomes. This is why, using the IAAPA benchmarks as a reference, we have calculated a decrease in the penetration values in the secondary and tertiary catchment areas of 24% and %77 respectively. Other advantage that is reflected in the penetration rates over the winter, fall and spring seasons is the lack of seasonality due to being a covered park. Although in summer, the walls will be opened and green areas will be offered, during the year and mostly in the rainy seasons the local market will have a great indoor leisure offer, not available anywhere else. When it comes to the tourist market, we believe that the penetration value will be around 1-‐2% mainly during overnight stays and people that come on holidays for various days or weeks to the Basque coast. It can be considered as a day activity to supplement the visits to the beaches.
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Finally, it is widely known that the penetration values will slightly increase in the years after the Water Park opens. By different means of advertising and as the awareness of the market improves, we expect to see an overall increase of at around 1% in the penetration per year to a maximum of 21% from 16%. This has been accounted for in the financial forecast that will be discussed later.
30 minutes % total Age 11,20% 5136 0-‐4 15,84% 7148 5-‐9 10,88% 4438 10-‐14 9,12% 3501 15-‐19 8,16% 3499 20-‐24 12,96% 16498 25-‐34 13,12% 21806 35-‐44 10,88% 17293 45-‐54 8,00% 10377 55-‐64 6,40% 13215 65+ 102911 Sum TOTAL RESIDENTS 207692 Total v isitors Tourist market 2600782 TOTAL TOURISTS 31209
60 minutes % 8,51% 12,04% 8,27% 6,93% 6,20% 9,85% 9,97% 8,27% 6,08% 4,86%
120 minutes
total % 2820 2,58% 4065 3,64% 2275 2,50% 1771 2,10% 1743 1,88% 8518 2,98% 10949 3,02% 8294 2,50% 5040 1,84% 6130 1,47% 51604 Penetration 1,20%
total 2878 4040 2626 2103 2008 8178 11045 8531 5258 6509 53176
2015 ATTENDANCE 238901 While researching for the attendance figures, we also took into account the nearby shopping mall and the effect it could have in our attendance levels. Looking at other similar examples for Water Parks working together with a shopping mall, we have The Oberhausen centrO shopping mall and the Oberhausen Aquapark in Germany. We see that overall the shopping centre has around 25 million visitors a year and the Water Park around 350.000 to 380.000 visitors. Knowing that our shopping mall attracts around 18 million visitors a year we believe that 238901 is an equivalent figure, taking also into account the difference in the local market population. As a side note, we believe that our waterpark would provide a better entertainment value offer than the Oberhausen Aquapark, which at this moment doesn’t offer many options for young teenagers. Once having stablished the projected attendance figures, and to later be able to calculate the facility requirements, we need to calculate the maximum amount of visitors that will be at the same time the busiest days of the year. In order to offer good entertainment value to all the visitors, it is required that, when the attendance is high every client should be correctly catered for. The waiting times shouldn’t be too high and every guest should have access to the basic facilities offered in the Water Park.
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In order to correctly asses the required figures we use the following Design Day calculation method. By looking at various work and school holyday calendars we assigned a percentage of possible attendance to each month. July being the highest scoring one (14.58%) and August following it (14.19%). The main difference among those two months are family holydays. In July, due to the fact that children don’t have school but parents have yet to work, there is a need to fill the children’s free time. And other hand in August, when parents are on holydays, some families head to other holiday destinations. This loss of local visitors is shifted by the tourists that come for summer holydays to the Basque coast. By dividing the month by the average weeks in a month we get the peak week value. This will be the base to calculate the design day value, which is industry wide considered to be 18.5% of the peak week’s attendance. The results can be seen in the following table.
Design Day Annual Park Attendance 238901 34825 Peak month (July) 14,58% 7861 Peak Week (/4.43) 1454 Design Day = 18,5% of peak week 1091 Maximum Capacity 75%
SWOT analysis After doing a thorough analysis of the area we want to stablish ourselves in, we have come to some conclusions on our strengths, weaknesses, opportunities and threats. The figure below summarizes our findings. Strengths -‐ Broad offer -‐ Use of new technologies -‐ Non-‐weather dependant -‐ Themed to a concept that people in the area can relate to -‐ New product offer in the area -‐ Room for future expansion Opportunities -‐ Economically stable market -‐ 1 million people within 30 minutes -‐ Area that is being restored -‐ Cheap land opportunities -‐ Already existing shopping mall that attracts lots of visitors -‐ Tourist and leisure development minded local governments -‐ Good transport connections -‐ Lack of existing offer
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Weaknesses -‐ High initial investment -‐ Outdoor area limited to summer -‐ Low secondary spending per capita -‐ High staffing costs -‐ Need for a broad offer
Threats -‐ Population getting older -‐ Population negative growth -‐ Not enough knowledge of the tourist market’s interest in this kind of leisure product -‐ Other leisure offer in the area -‐ Economic crisis in Spain -‐ No control over utilities costs
Starting from our internal factors, the strengths and weaknesses, we can conclude that the main challenges that may have to be faced are related to the need to cater for a wide market, for a wide variety of ages. To solve this there will be a need for high investment and higher amount of staff. We also note low secondary spending as a weakness, but, to prevent this from being a big problem, we believe that the use of new technologies (RFID wristbands or other water friendly payment methods that are being developed) will help the Water Park overcome this problem. Not being weather dependant will also be an advantage, a longer season will be possible and the local market will be able to enjoy their leisure time on the park all year long. As explained earlier, having an outdoor area will certainly be a nice opportunity during summer season, but can also be considered as a weakness as it will be closed during bad weather season, creating extra maintenance costs without providing revenue. But above all we believe that our biggest strengths is offering a unique experience that cannot be enjoyed anywhere else in the area. When it comes to external factors, our main opportunity in the area is the lack of similar offer, even more, the area already has a high power of attraction for leisure activities related to shopping, dining or cinema which can help us gain visitors faster. Aside from that the area is very well connected via different means of transport. Having a subway station that connects us to more than 800.000 people that have direct access to it, or being just a minute away from the main freeway of the area, will help our prospective clients get here easier and faster. It is also important to note, that being a Water Park, our main tool will be the water as well as electricity and gas to heat the water. As a utility cost they have to be paid monthly and their price is out of our control. This could bring our operating cost up as utilities are expected to rise in a small percentage in the area. But we do understand that the local government might be interested in subsidizing part of the costs during the first years, which could help the project settle. Analysing possible challenges, the market population negative growth is the most important one. Due to a decrease of the population and the ageing of it, the park will have to continuously adapt and invest to provide an offer better suited to improve the market penetration in the tertiary catchment area and to attract more tourist. This will help to balance the loss of population with the addition of new markets. When it comes to socio-‐political matters, it must be mentioned that the Basque Country, and especially in the Biscay province local governments are very keen on leisure and culture related investments and offer attractive help to anyone creating new jobs in the area. It is also important to note the higher quality of life of the area comparing it to the Spanish standards. Overall, it can be mentioned that the strengths and opportunities offered by the local market are good enough to overcome all the challenges that will have to be faced. Although, it will require a good future development plan and high reinvestment of revenues we believe that in the current situation an indoor Water Park is a good project for the area.
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4. Marketing strategy Core concept As mentioned in the introduction, our project will consist on developing an indoor Water Park. Indoor Water Parks, as outdoor Water Parks offer a combination of slides, pools and grass/pavement areas together with services that can also be found in amusement or theme parks, as F&B, retail areas and varied activities. They can both, sell only an experience or also pair that experience with theming to tell a story or transmit a message. As theme parks do, they also offer a safe and controlled environment where visitors can escape from their daily tasks for a day or various hours and make use of the additional services offered, as can be dining or enjoying a special event. Aside from this, indoor Water Parks also offer a closed environment that protects them from the outside weather. This proves useful by allowing a longer season, which can help them become an interesting water related destination when the rest of the offer is off season due to bad weather. In our view, some of the values and services that an ideal indoor Water Park should follow are, safety, great guest service, varied offer, appeal to a broad target, good secondary spending offer, additional facilities for the summer season, a unique themed experience that connects with the visitors and a broad calendar of additional activities. Based in those values, in the following sections we have prepared a short description of how our Water Park product would look.
Product description It is 2020. The old shipyard with unfinished ships appear as if they were left yesterday. Still, the rust gives away that the factories haven’t been used in years. As you walk around, you can sense the old feeling the factories have. If you look closer, a small flower is growing in one of the water boilers of a machine. Suddenly you realize that the factory is full of flowers, plants, grass, moss and other great parts of nature. Nature has taken over... The entire area will be themed in the theme: “Nature takes over the industry”. So there will be a lot of plants and flowers to add to the industrial environment that is already there. As we said earlier, we would like to build our Water Park inside a building that looks like an old shipyard. That way, a combination of the local heritage of the area and the new idea of green areas and connection to nature would be created, offering new exciting experiences. Mood board for the project available in appendix 6.
Hardware and facility offer The main hardware that we have to deal with in a Water Park is of course the water slides and the playground for little kids. These elements are essential for a Water Park. We also expect to offer an area designed for wellness services that should be in the future development plans. Initially an indoor area of around 6000m2 should be offered, in that area all the necessary services should be available, technical rooms, offices, water area, changing rooms, F&B area and an initially small wellness area. During the initial investment a small outdoor area of 10.000m2 should also be made available for summer picnic and outdoor entertainment. With possibly an outdoor pool that could connect with the area inside. Finally a parking lot of around 10.000m2 should be made available. From the purchased 40.000m2,
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there will still be plenty of land available for future development. Possible slide and pool offer information in appendix 5
Food & Beverage outlets The Food and Beverage outlets will be themed in the same way as the Water Park. At first, we would like to start with only one big Food and Beverage area, as the maximum capacity is a little over a 1000 visitors. This would be enough to give great service to all of the visitors. The food that will be served is: sandwiches, French fries, hamburgers and snacks. The drinks that will be sold are: coffee, tea, hot chocolate, soda, water. As a future experience a formal dining experience should be added. Local laws state that the F&B areas must be clearly separated from the water surfaces. Eating must be forbidden in the water areas. Being in an area that is interested in cooking, we do believe that it could be interesting to add a barbeque area in the outdoor part. This barbecue area would include sheds that could be used during winter and bad weather days. The cultural habits of the area indicate that people like gathering and cooking their own food. Giving people from the city the opportunity to do so in a green area and combining it with a visit to the waterpark it would be a possible way to attract more people in low season.
Retail There will be no specific retail area in our Water Park at the beginning, due to the lack of possible product offer and cost that it would add. At the start of the project we recommend using the maximum available space to offer an important experience. We are planning to expand our concept in the future, so, in future developments there should be room allocated for a merchandising area. Any product that we may want to sell should be offered through the front office.
Guest experience Process The moment you enter the building, the employee working at the cash register will kindly welcome you. You will be gestured to the locker rooms where you can leave your clothes and valuables. After you have changed, you can enter the Water Park. After a few slides down the water slides, you have become hungry. You will be happily served by one of the employees and you can eat your meal at a nice table. In summer there will also be a chance of having a picnic lunch in the green area outside.
Pricing
Following the current trend in some of the Water Parks in Spain and Europe the pricing will be based on height. It will be divided into three tiers, 90cm-‐1.10 m, 1.10-‐1.40 and 1.40+, with gate prices being 8.9€, 14.9€ and 20.9€ respectively. We also believe that a season pass should be stablished in order to engage local people and attract their families when visiting. The cost for it should be 49.9€. This will equal nearly 3 visits, we believe that people without the seasonal pass would not repeat that much. There should also be an option to visit only the wellness area, we recommend a price of 14.9€. This price is average to the competitors in terms of Spa offer and wellness offer. Some of the retail and F&B prices should also be outlined. All drinks will be sold at a price of €2.50. The sandwiches will be sold at a price of €4.00 each. The hamburgers and fries will be sold as a combination with a price of €5.00. Keeping in mind the habits of the area it is not recommended to have a parking price greater than 2€, this is mainly due to free parking spots being offered in the nearby shopping mall, although we would still charge a small
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premium for to the visitors that want to park on location. The price for Hair dryers shouldn’t be higher than 0.5 for head dryers. Locker should be offered included in the price. Something that will greatly improve the guest experience.
Staffing Based on the laws of the Basque country and Spain the minimum requirement for lifeguard services is based on the water surface available in the Water Park. Based on the same law the minimum required water surface per visitor is 1m2. Using our design day figures plus an extra allowance, we estimate that a minimum of 1500m2 of water surfaces will be needed. This water bodies will be distributed in various different areas, not forming a single body. Taking this into account and using Spanish average requirements, there is a minimum of one lifeguard per 500m2 water surface and one per each individual water surface. We will also need one per each slide. We calculate a total of 16-‐20 lifeguards depending on the initial investment on slides. We will also require the standard management team, general manager, operations, financial and marketing managers. We also believe that a park of this size should have a small first aid area with an on duty paramedic. F&B will require 3 people, 2 employees will required for the front desk. We expect to involve a third party company for the cleaning and health control services. Maintenance, being an essential part of safety, will also require 2 people. Training schemes should be provided in order to both ensure a safe operation and teach the lifeguards and other staff members the basic in guest relations and hospitality. Basque language courses should also be provided in order to offer a better experience to Basque speaking visitors. Uniform theming should also be considered in order to provide a complete theme experience.
Promotion At the starting point of the project the target should be to generate high interest in the local population, mainly in the primary and secondary catchment areas, local television offers a great channel, sponsored by the government. Social media and of the use leaflets and posters. In this way we will at first make the main visitors, coming from the Bilbao area notice that there is a new attraction coming their way. Approaching the opening of the Water Park, emphasis should be put on the tertiary catchment and as a future development plan there should be more promotion at the traveling agencies, so that they can attract foreign tourists that may be visiting the area as well.
Future development and the tourist market As we explained in the market research, it will be important to design a good offer in order to improve the tourist penetration value. As it currently stands, the majority of the tourist market comes to visit the cultural offer around Bilbao and they usually stay for a weekend. After researching and trying to find a good solution to attract this segment of the tourist market, we believe that there is no real solution to attract visitors fitting that profile. Despite getting to that conclusion, we still believe that in the future, by using ticket combination with cultural attractions and also providing additional theming that conveys the story of the area we may be able attract a small part of the cultural tourists that stay for longer than 2 days. When it comes to tourists visiting The Basque Country for summer holidays and staying for a week or longer we recommend providing a combination ticket with the nearby multiplex cinema, that way creating a full summer day experience, waterpark in the morning, dining in the outside barbecue area and cinema and fine dining in the evening. The required developments for this segment of the tourist market are simpler and similar to the ones a big
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theme park would have, mainly reinvesting in new slides and experiences that will enhance the water park entertainment value.
5. Financial Plan Once the marketing mix has been stablished and taking into account both the pricing and the annual attendance we can start to calculate the different revenue sources and the costs related to both the initial investment and the operating costs.
Revenue Analysis To properly calculate annual visitor numbers two elements are essential, attendance and per capita spending. We have already presented the attendance information. In the following section we analyse per capita spending in the park. Per capita spending is the average amount of money that a visitor will spend while in the park. From the admission price to any money spent in extra services or products offered in the park. Following the industry standards, admission is usually the biggest part of the per capita spending (Around 60%). After that, we have F&B revenues which amount around 25% and finally we have merchandise and other paid services provided in the park. Taking into account that, usually, due to discounts or different prices among different age brackets, the money spent on the entrance ticket isn’t exactly the advertised gate price. Furthermore, following European benchmarks, and focusing on repeating local visitors, we expect around 20% of the visitors to use a season pass. We consider 14€ to be the average admissions per capita income. When it comes to Food and Beverages, it is widely known that, due to being in swimwear, money handling can be a problem that makes people spend less inside the Water Park. But thanks to new technologies, that are being developed, we expect to overcome this challenge and get around 5€ of per capita spending in F&B, mainly coming from drinks and snacks in winter and periods when the average stay in the park is in its lowest and meals during summer and bank holidays when the average stay time is in its peak. Merchandising will be a very small percentage of the overall per capita spending. In our Water Park the merchandise offered will be minimal and mainly related to swimming materials. This is why we do not expect the merchandise figure to be over 1€ per visitor. Finally, there are various income sources that can be included in the average spending per visitor. Having a spa service, which is included in the general admission, gives us the opportunity to offer unique and extra treatments that can provide an additional source of revenue. Water play element rental, hair dryers and parking costs are also part of what we have categorized as other revenues. This would amount to 3€ per capita. In conclusion, taking into account the different revenue sources, we consider our projected overall per capita income to be 23€ which is still in line with other Water Park per capita spending benchmarks around the world. In the economic forecast we also accounted for yearly price rises with a 0.5% increase due to inflation, tax changes and economic variations.
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Cost Analysis Aside from the initial investment costs, in its yearly operation the park has to consider various operational and administrative costs. Among those staff related costs are the largest. But we also have taken into account expenses related to utilities, maintenance, costs of good for sale, marketing costs, and other administrative costs, as insurance, legal fees or taxes. Staffing costs will be the largest operative cost. Taking into account the staff requirements that we have stated before and assigning an annual salary to each of the different positions we have reached an approximate value. This value will be increased every year due to the economic factors and as visitor numbers increase. We expect labour costs to be around 40% of the total revenue. During the first years the most important goal will be to attract as many local people as possible, after the local market is consolidated and as the Water Park develops the aim will be to broaden the catchment area. Experts note that the costs of running all the marketing projects usually takes around 9% of the revenues. That is the value we have used to forecast the marketing costs. Maintenance will be essential in order to ensure a daily safe operation and offering high quality service. To conduct correct maintenance a stock of supplies is required as well as an allowance for any emergency expenses. Using available benchmark figures we consider that maintenance will be around 8% of the revenues. Being a Water Park, water, gas and electricity will also be a big part of the annual expenses, public taxes are also included in this section. By making use of the current government subsidies for large companies, we believe public service costs would amount to 4% of the revenues of the year. We have included insurance as the most expensive item in administrative cost taking around 4% of the total revenues, together with other administrative costs like software systems, staff training programs or various services by third party companies. Overall the cost will amount to 10% of the revenues. Merchandise and food and beverage stock costs (also known as cost of goods sold) is also an important part of the yearly expenses that will require around 5% of the revenues. Finally, after all the operating expenses have been accounted for, expenses that don’t come from the daily operation of the park have to be studied. Leaving tax aside we believe that having an estimate for depreciation and amortization of our assets is important to get a good picture of the real operating income. In our case we have assumed a life span of 20 years for the hardware elements of the pools and 50 years for the building. With an investment of 6.000.000€ in the building and 6.000.000€ in hardware we expect a yearly depreciation value of around 420.000€. We have also calculated an increase on the depreciation costs due to future CAPEX. In terms of amortization, as the money comes from investors, there are no planned loans or debts.
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Profit & loss / ROI analysis In conclusion, after analysing both revenues and the operational costs, we consider that the yearly profit will be around 1 million euros, the complete forecast is available in appendix 7. Keeping in mind that we have created the forecast based on a base case scenario, with modest negative growth of population and a small percentage of penetration increase, we believe that increasing the catchment area, by reinvesting, attracting a higher amount of the tourists and generating more returning customers in the area the market penetration can be higher than anticipated driving more revenue. We believe that having enough land surface available for future developments, and with at least 50% reinvestment from the net profit we believe that the park will be able to adapt to a growing attendance and at the same time improving its entertainment value by offering unique experiences in the area, and broadening the parks target group. We consider 16.000.000€ to be a feasible initial investment. Making use of the current land purchasing subsidies in that area about 40.000m2 of land can be purchased for 4.000.000€. With an initial cost of around 2000€ per square meter we believe a 6000m2 initial building and 200€ per square meter for a 10.000m2 outdoor area, would give enough space for an attractive offer. We also consider a parking space for 200 cars and 5 coaches which would cost around 400.000€. Taking into account that figure and leaving out depreciation value, we estimate a break-‐even time period of 10 years and a ROI of 68% in the first 20 years, we believe that this project is competitive and offers an interesting ROI rate in the best scenario. When it comes to the worst case scenario, we anticipated a slower penetration growth rate (0.3%) and a lower average spending in F&B (3€), merchandise (0.5€) and others (1€). We also estimated a higher population decrease rate. This would mean a lower attendance value and in turn decrease in revenue. The results for the worst case scenario (appendix 8) still shows a profitable situation. Although the break-‐even point shifts to around 15-‐16 years, the return on investment in 20 years will still be positive and will amount to around 26% of the initial investment. This is why we believe that the project we are studying is economically feasible and attractive for multiple small investors. Moreover, we haven’t had into account the multiple subsidies offered (labour related) by the local governments, which are very keen on new investments and new employment opportunities in the area.
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6. General conclusions and recommendations After performing all the required research of the current market and the future projections, we believe that the area allocated for this leisure project is suitable for the development of an indoor Water Park. With an appropriately connected site, with options, for accessing with a car, or by public transport, the choices are good enough for families or young teenagers that may want to come alone. The current leisure offer around the site is also within our requirements, with no other similar attraction in less than 3 hours driving time we can provide a unique leisure offer that, as the market analysis show is interesting for a reasonable part of the population. Although with the initial investment the target is to attract local and medium range population, we recommend that, in the future development plans a clear path should be defined in order to broaden the market penetration an attract more tourists that otherwise would limit their visit to the currently available museums and attractions. We also recommend the collaboration between the mall located nearby, already attracting 18 million visitors a year (including repeating visitors) and the convention centre also in the vicinity. This could be an opportunity to create a large leisure area that in the future could even attract more entertainment offers, maybe even including accommodation. When it comes to the challenges that will have to be faced, the most important one will be population ageing. This will require a good reinvestment plan, both in activities and new areas inside the Water Park. Good research should be made about the necessities of people older than 50 years in terms of wellness activities and spa related treatments. These extra treatments can also become an additional source of revenues in the future. Another important challenge to be faced is the secondary spending. We recommend looking for a good payment system that will help customers feel comfortable using new technology to pay. There are already various systems, as waterproof RFID bands, being designed. We believe that allocating part of the initial budget to implementing a system like that in the Water Park would improve our revenue projection in concessions. Another important idea to develop in the possible business plan for the waterpark, is the use of the outdoor area to offer additional activities during summer, which can include concerts, public or private events or any other activity related to entertainment and culture. And finally we believe that the tourist market has a great potential, with good connections, both national and international. This is why we believe that by creating an adequate development plan for an interesting offer for tourist coming for a cultural experience we will be able to improve our revenue sources. Overall, as the external factors are considerably in our favour, we believe that theming, together with a good product mix and experiences for all ages, a well-‐designed secondary spending system and a good future development and reinvestment plan this project will be feasible and provide an excellent leisure offer in an area that is currently missing one.
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APPENDIXES
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Appendix 1 – General location map and detailed site map
Red: planned development area Green: currently available shopping area Blue: 250.000m2 convention centre
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Appendix 2 – Basque Country weather Month Temperature Rainfall mm January 9.0 126 February 9.8 97 March 10.8 94 April 11.9 124 May 15.1 90 June 17.6 64 July 20.0 62 August 20.3 82 September 18.8 74 October 15.8 121 November 12.0 141 December 10.0 116 Source: AEMET
Overall rainy weather, with mild summers, outdoor operation in summer is possible but limited to June, July and August. Although August is prone to summer storms due to heat.
Appendix 3 – Age pyramid Evolution 2013-‐2026
Source: EUSTAT. “Proyecciones Demográficas 2026”.
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Appendix 4– Competition Map
Water Parks: 1. Our park 2. Aqualand Bassin d’arcachon 3. Piscina de Hernani 4. Local pools from Vitoria (high attendance numbers) Zoo’s: 1. Karpin Abentura 2. Getxo Aquarium *Located in Bilbao* 3. Cabarceno Natural Park 4. Senda viva Theme Parks: 1. Parques de Atracciones de Madrid 2. Parque Warner Madrid 3. Port Aventura
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Museums in Bilbao (not in map) : Guggenheim Museum “Museo Bellas artes” “Museo Maritimo”
Appendix 5 – possible slide and pool offer The slides that can be considered for this kind of indoor water park (using manufacturer proslide as a source of the hardware): Tornado 45 with a 4-‐person boat with a capacity of 720 people per hour. We chose for a 4-‐ person model because we take in to account that it can be busier in the future and that we need al the capacity that we have. This slide is going to be partly indoor and partly outdoor. Example picture of the Tornado 45
TurboTwister this slide doesn’t need a boat to ride it. Also this would be a dueling format so we can create a hour capacity of 360 persons. Example picture of the TurboTwister
WaterKingdom Complete and compact water park offer in a customizable design that can be themed and offers thrills and experiences for families and teenagers alike.
Krakenracer this is a racer slide with 6 lanes next to each other. The only thing you need is a mat to ride it. The hour capacity of this slide is 900 persons. Example picture of Krakenracer
RideHouse 600 this is an interactive kids play 31
Surfin’ fun
area which contains 8 slides. Example picture of the RideHouse 600
FlowRider ® Single With the FlowRider from Waveloch people can experience the surfin’ feeling inside a building for a special addition price. Example picture of the FlowRider ® Single
Besides the waving pool and other swimming area’s we also want to create a lazy river. Lazy rivers are very popular these days and give a very nice moment to relax. Even though there is a Lazy River we also offer the guests a wellness area to relax into a nice whirlpool or in the future receive a massage. Future possible developments: In the future the waterpark would like to expand with an outside part of the waterpark. There are already some ideas to build a whitewater track and a 6-‐person TornadoWave with a hour capacity of 1080 persons in the outside expansion, an eye catching attraction that All these slides, except the whitewater track and kids play area would be manufactured by ProSlide. Example picture of the TornadoWave
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Appendix 6 -‐ moodboard
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