Hospitality management – facilities management


Hospitalitymanagement – facilities managementStudent’sName 1 Introduction………………………………………………………………………………………3

1.1 Aims and Objectives 3

1.2 Methodology 3

2 Key issues and considerations in a feasibility study of a property/facility development 3

2.1 Market 3

2.1.1 Business environment analysis 3

2.1.2 Market analysis – 4

2.1.3 Market segmentation 4

2.1.4 Competition analysis – 4

2.1.5 Location and Site 5

2.2 Finance 5

2.2.1 Sources of funding – 5

2.2.2 Concern in securing the funding – 5

2.2.3 Financial viability of proposal – 6

2.2.4 Risk assessment – 6

2.3 Legislation 6

2.3.1 Analysis of issues linked to suggested business operating model – 6

2.3.2 Recognition of legal basis – 6

3 Conclusion 6

1 Introduction

    1. Aims and objectives of the report – the report discusses the major issues, as well as considerations, which must be incorporated in a feasibility study involving the development of a facility/property project. The facility is a small fast food business, which targets school-going children. It will be located close to a school, where it is easier for children to buy eateries at their convenience.
    2. Methodology – information required for the study involves determining if the location is suitable for the facility the number of children in the school whether the fast food will meet their demands and what foods the children may want. The approach uses secondary data from the school, previous surveys conducted around six months ago by a research firm that is located near the school. In addition, other sources of secondary data will be results of a school project that was conducted last year concerning the feasibility of this location for a fast food outlet.
  1. Key issues and considerations in a feasibility study of a property/facility development
    1. Market
      1. Business environment analysis

Macro-environmentalinfluences on property/facility

Micro-environmentalinfluences on property/facility

      1. Market analysis –

It involves theevaluation of possible market segments through consideration ofmarket information. The analysis accesses the charm and dynamics of aparticular market in a particular industry. It depicts the businessand market knowhow. Size, Growth, Accessibility, Consumer needs,wants and benefits sought and Customer power.

In addition, interms of concept and design it is important for all stakeholders toshare ideas in order to ensure that the outlet will not only meetcustomer needs, but also those of the workers, owner, localauthorities, as well as comply with relevant legislations (Bowie &ampButtle, 2011).

      1. Market segmentation

It entails splittinga wide target market to divisions of consumers that have similarneeds and precedence, and formulating and implementing strategiesthat target potential clients. Comprises of analyzing the differentvariables entailed in segmentation, which are:

Benefits sought bypotential consumers from the facility

Business segments

Price segments

Social classes amidtarget consumers, which are likely to affect the facility development

Demographic segments– includes issues like age, education and earning among others

Purchase series andfrequency

      1. Competition analysis –

It is important toconsider possible competition prior to facility development. Thisinforms on the possibility of success of the facility within a givenregion. There are numerous types of competitors and competitiondiffers on different aspects.

Existing andprospect competitors

Direct and indirectcompetitors

The market share ofcompetitors

The abilities andresources available to competitors

Strengths andweaknesses – at this stage a SWOT analysis will be necessary indetermining the competitive advantage that may be available for thenew facility.

The possibility ofnew entrants in the similar property/facility development

Competitors’differentiators and profitability

      1. Location and Site

Location – it isnecessary to consider the location for the project development, whichentails bearing in mind issues like the expected competition,prospect changes, and economic possibility of the region andinfrastructure.

Site – refers tothe intended place where the facility will be situated. Indetermining the site, key issues and considerations are siteavailability, expenses incurred in acquiring the site, developmentrestrictions, local demand and footfall sequences, access andbusiness related flows.

    1. Finance
      1. Sources of funding –

The facility is apartnership hence, the sources of funding will come from allpartners. Every individual is expected to contributed an agreed uponprice towards the project.

      1. Concern in securing the funding –

Concerns include thepossibility of some partners being incapable of providing thespecified amount and in time to commence the project. In addition,some partners may have other financial responsibilities that may tietheir contribution in the project thus affecting continuedoperations.

      1. Financial viability of proposal –

It is important toassess the general financial viability of the proposal, which refersto the capability of recouping initial capital expenditure over anaccepted period.

      1. Risk assessment –

It is important toconduct a feasibility study, which determines whether the projectwill generate enough money as expected to ensure a healthy cash flow.

    1. Legislation
      1. Analysis of issues linked to suggested business operating model –

They include jointventures, sole trading, limited company, franchise, managementagreement, partnerships, and network organization among others(Hassanien &amp Clarke, 2010).

      1. Recognition of legal basis –

Relating toland/property ownership like hiring, leasehold or freehold

  1. Conclusion

When planning tooperate a fast food business, key feasibility issues andconsiderations need evaluation. These include market, finance andlegislation. In addition, it is important to carry out a privateresearch or hire a firm to conduct a market analysis of previous andcurrent economic situation of the surrounding community to furnishyour decision-making.


Bowie,D. &amp Buttle, F., (2011), HospitalityMarketing: Principles and Practice (2ndEd). Oxford: Elsevier. Parts A &ampB.

Chaudhary, M.,(2014), Feasibility Study – an Important aspect of ProjectManagement. The Turning Point, Available at: study

Erfourth, W.P. &ampAgosta, R.F., (2002), Feasibility studies, Journal of ConstructionAccounting &amp Taxation, vol. 12, no. 5, pp. 25-27.

Hassanien,A., Dale, C. &amp Clarke, A., (2010),Hospitality Business Development.Oxford: Elsevier.

Meidute, I. &ampPaliulis, N.K., (2011), Feasibility Study of Public- PrivatePartnership, International Journal of Strategic PropertyManagement, vol. 15, no. 3, pp. 257-274.

Mortgage andHousing Corporation. (2014), Project Feasibility Analysis, Stepby Step, Available at:http://www.cmhc-