Do you need to do a viability study? Here my proposal:1,2, 3 theory for marketing AND Bermuda triangle for the financial area.

Sometimes I have to do a viability study, as you know a complete one has to deal with financial and marketing concepts.

For marketing in tourism I think nothing can defeat 1,2,3 theory both for initial positioning and for subsequent  growing strategies.

What about the financial area? Will I recover the investment? When? Will I get a decent profit? How much?  Will I have enough liquidity? All of these questions worth a lot of study and a great amount of excel sheets, but sometimes I need to provide a fast answer or I need a good beginning for the process or I need to decide which project is the best to focus on. Then Bermuda triangle is a good choice!

Most of my students hate and are afraid of anything related with numbers. My first subject as a teacher in Touristology was Financial Mathematics. So, I know firsthand the necessity to explain difficult concepts in a simple way. Have I succeeded it? You can tell me!

Nowadays, at least in my country, this topic or not exist or is given in a way that doesn’t provide a framework related to our field. 
Nevertheless, I strongly believe that knowing the investment to create a tourism company, the average revenue, the percentage of the most usual cost, the average profit... is something that we, as a Touristologists, must master.

For that reason I proudly introduce... THE BERMUDA TRIANGLE. Its name stands for the famous triangle in Bermudas where ships, carriers... have disappeared. The same happens with a business without balance between investment, revenues and profits... it will disappear!

It’s a financial-geometrical figure which represents the necessary investment to create a company, the revenues when the business is a cruise’s speed and the usual profit without taxes. Cruise’s speed? I mean, usually companies need a few years to get his full potential. It can be four years or sometimes a single day. Anyway we choose this amount.

 

All these numbers represents an average of the range that you can find in a real scenario. They are only a start point to become the hard work BUT they are a good beginning!

The investment is base in my experience; feel free to bring new examples to backup OR NOT this numbers. When we are talking about hotels of 3-4 starts in a centric area an alternative way to assess the investment is to multiply 120,000 by the number of rooms. Of course, this is less true for hotels with a lot of space for conventions, bar, restaurant, etc.

For instance, we can see if Sol Melia (the biggest chain of hotels in Spain) can fit in this Bermuda Triangle. In order to get some numbers you can go to here.

I summarise for you the key information for 2010:

Number of hotels 350; Company’s revenues: 1.3billion (for non English people remember that one billion equals to 1,000 M!!!); Profit: 50.1M Can you do the math? Does it fit? You must remember that 2010 was a tough year!

I Love Touristology even when mathematics and programming skills are required!!!

As you can see Bermuda Triangle is a fast way to know if a project can have future or if it’s worth to go deeper.  What do you think? Can you provide more examples?  Let’s build up the bedrock for the best science ever... TOURISTOLOGY!!!!