Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Crashpadz Inc. Business Plan

Crashpadz Inc. Business Plan

  • Be the first to comment

  • Be the first to like this

Crashpadz Inc. Business Plan

  1. 1. 1 Table of Contents Company Analysis 2 What is a Crashpad? 2 Crashpadz Inc. Overview. 3 Immediate Expansion Plan 5 Long-Term Expansion Plan 5 Current Performance 6 Meet the Team 6 Value Proposition 7 Testimonials 8 Crashpadz, Inc. Property Pictures 9 Business Model 10 Market Opportunity 11 Industry Analysis 13 Bed & Breakfast and Hostel Accommodations Industry Overview 13 Industry Performance 13 Industry Outlook 13 Key Industry Trends 14 Products and Services Segmentation 14 Market Analysis 15 Market Overview 12 Bed & Breakfast and Hostel Accommodations Major Markets 12 Consumer Trends Among Younger Travelers 14 San Francisco Tourism Market 16 Uber and Lyft Drivers 18 Local Target Markets 18 San Bruno - 94066 19 Oakland - 94610 21 Daly City - 94015 23 Competitive Analysis 24 Competitive Overview 24 Major Competitors 25 SWOT Analysis 30 Marketing Plan 31 Marketing Overview 31 Marketing Goals 32 Online Marketing Initiatives 28 Direct Marketing Initiatives 30 Operational Structure 33 Corporate Information 33 Corporate Structure 33 Management Team 34 1
  2. 2. 2 Company Analysis What is a Crashpad Crashpadz™ are shared living accommodations providing temporary living solutions to people with shared intentions. Crashpadz guests otherwise known as "Crashers" can stay anywhere from a day to many months. With our competitive rates Crashers can "test the waters" before making a longer term commitment. Crashers can enjoy the ultimate in flexibility in terms of living. Once a reservation is made, the Crasher can stay at any of the locations within our network (currently three locations). As more Crashpadz are brought into our network, Crashers will have even more flexibility when traveling and working at locations away from their home base. Crashpadz™ Inc. Overview History In 2014 Zameer Azam (Founder) was a rideshare driver for Lyft and living in one room of his parents rental home located in Daly City, California. While driving for Lyft one night he met a flight attendant, who later on went onto become his girlfriend. The two eventually moved in together into his room. Zameer Azam was working part time as a Lyft driver while also dedicating his time to renovating his childhood home and pursuing a B.S. degree at San Francisco State University. His then girlfriend had suggested that he turn his home into a Crashpad. Unbeknown to Zameer at that time what a “Crashpad” is or was. She had suggested that she take him to one. Upon completion of renovations, he began to build bunk beds in each room and set up a shared accommodation Crashpad structure. Then he listed through the major Airlines mainly United, Virgin and Skywest. Within weeks a steady supply of recently graduated flight attendants looking for an affordable place began to pour in and fill up the bunk beds in a dormitory style setting. As a few months went by flight attendants were relocated and new classes had not yet graduated so beds were remaining empty. Wanting to fill empty beds and generate revenue he decided to open the beds which were not filled on AirBNB. Since then Crashpadz has created its own website and utilizes many different OTA's (Online Travel Agencies i.e. Expedia, Booking.com and since these are aggregator sites the OTA's themselves list on like 10 different partner/affiliate sites, allowing affordable accomodations to always stay in high demand.) 2
  3. 3. 3 Short term rentals in homes was a thing of the recent future, we originally priced the beds very low and as demand began to pick up so did the price per bed. Zameer was able to turn a 4 bedroom house that typically rents on the general market for about $3,500 to a whopping $13,000 per month. In effect he took a 4 bedroom house and without building any additional bedrooms, increased the net revenue by over 300%. Demand for affordable accommodations skyrocketed and this is when Crashpadz was born. Crashpadz Inc. (also referred to as “the Company '') owns and operates flexible, affordable, and strategically located crashpad in the bay area. Crashpadz is trying to help in alleviating the shortage of affordable housing in expensive cities such as San Francisco, Los Angeles, New York City and surrounding areas. Crashpadz provides shared dormitory rooms that give you all the amenities and comfy feelings of being at your home away from home. Crashpadz Inc. launched its first location in Daly City known as SFO Crashpad. SFO Crashpad has become the top choice for travelers due to its competitive prices at an average of $42.40 per night, well-maintained facilities, and close proximity to San Francisco. The Crashpad is only 8 miles from downtown San Francisco, 4.5 miles from San Francisco Airport, and 100 feet from public transportation. The Crashpad currently holds a 4-star rating on Google and Facebook in addition to a “Very Good” rating from leading travel site Agoda. Crashpadz offers clean and spacious rooms as well as several value-added services to ensure satisfied customers. These services include free WIFI, snack machines, a VR game room, fantastic social settings and activities, as well as travel recommendations within the Bay Area. Furthermore, Crashpadz offers flexible rates for short-term or long-term stays, convenient check-out times, self-check-in processes, and does not require guests to provide a security deposit Management Team Zameer Azam Founder/CEO Zameer Azam is an experienced business professional with more than 18 years of experience in sales, marketing, and business development within the residential, transportation, and retail clothing industries. Zameer is an industry veteran when it comes to starting and running successful businesses. Zameer has been the owner of Crashpadz Inc. since founding the business in 2015. He has managed all aspects of the Company’s flagship property in Daly City. Zameer is also responsible for doubling the property’s gross income every year since inception. Zameer was also a professional options trader at Excalibur Trading, LLC where he traded on his own account from 2011-2015. This was a crucial stepping stone for Zameer’s career and he used this opportunity to perfect his stock market trading analysis skills. Zameer also learned how to harvest any losses by writing them off against any gains from other business ventures. Zameer was also the owner and operator of G-Spot, a retail clothing store that eventually became an online retail business from 2001-2002. Zameer was responsible for ordering 3
  4. 4. 4 wholesale inventory, photographing merchandise for marketing, creating product listings, accounting and invoicing, as well as shipping packages daily to customers all around the United States. Zameer was able to turn a significant profit at G-Spot, similar to his successes at Crashpadz Inc. Investors can trust in Zameer’s professional track record. His wide set of skills, determination, and passion for affordable living solutions will continue to be a key driver for the Company’s future success. Zameer will be responsible for acquiring new locations, building them up to proper standards, and ensuring a widely replicable hostel format. Jason Voelker Business Partner/ Chief Compliance Officer Jason is a litigation and legal research specialist. He has experience within research support, online legal research instructions, operations management and strategic planning. Jason has successfully provided solutions to the information challenges faced by numerous law firms, corporations, government officials, and the general public. Jason has been the Executive Director of the Marin County Law Library in San Rafael, California since 2012. He is responsible for the short and long-term planning needs of the library including its overall administration. Jason is also in charge of the research and technological requirements of legal staff and library patrons. As a result of his position, Jason has developed skills that will greatly assist in the operations of Crashpadz Inc. These skills include budget development and control, coordinating legal research for county officials and the public at large, and interdisciplinary collection development in digital and print formats. Jason also conducts in-depth research in practice-specific areas, legislative history, and recent changes in the law. Jason is also responsible for the development of catalogue procedures, contact negotiations with multiple vendors, guiding patrons through internet-based legal research programs, and incorporating new technologies into the Marin County Library. Jason was also a Lead Law Clerk for the Conservation Center in Jamestown, California from 2009-2012. Responsible for the research and application of relevant laws regarding client case facts in the areas of torts, civil rights, and criminal law, including the maintenance of a 40-client portfolio, direct contact with opposing council, petitions for the writ of mandamus, as well as filing of habeas corpus proceedings in state and federal court. Jason also facilitated offers, dispositions, discovery, and recorded statements. His experience also included drafting of summons, complaints, motions, and oppositions to motions, as well as facilitating FOIA and CPRA requests including follow-ups. Jason’s law experience, successful real estate investments, and his research skills will greatly aid the Company especially with any financial management concerns. 4
  5. 5. 5 Raymond Young Chief Financial Officer 1986 UC Berkeley B.S. Finance and Accounting 1986-1990 Internal Revenue Service 1990-1993 Jeanpierre & Co CPAs 1993-present Raymond Young CPA NASA audits around 1993 to 1997 Joint ventures with Deloitte & Touche doing auditing for large entities approximately 1992 to 1998 a. Strong marketing background, including two $5,000 seminars with Abraham.com, and learn from people like Clayton Makepeace, Gary Bencivenga, Russell Brunson, Grant Cardone, Anthony Robbins, and dozens of others. The proof is my business card, nobody else has a similar business SALES card in auto sales, solar sales, CPA, attorney, doctor, appliance sales, any profession. businesscard20200220165153.pdf b. 1990-2006 Photographer who made it to the top level - there are only about 25 to 50 still photographers at any major event Oscars Emmys Grammys Miss Universe Miss America etc. I made it pretty much every time from 1996 to 2003. My final agency Agence Press Sygma got bought out by Corbis, who got bought out by Getty Images. Getty Images considers me an honorary alumni. https://www.facebook.com/cpaphoto/media_set?set=a.162188060109&type=3 Venkatesh Venkatasubramanian Chief Technology Officer Venkatesh is an Engineering graduate and an experienced Technology Consultant having a handful of experience in the Asia/ North America market. After working/ consulting with multiple reputed Domain Name registrars as Product Manager and Business Development in helping businesses scale. Venkatesh has a deep understanding about technology and how to integrate technology in mission critical business solutions. In the past he worked as Product Manager for Web Werks India Ltd, a Data Center and Domain Name Registrar in Mumbai, India. Recently moved to the Bay Area to take a position in Nusoft Inc as Business Growth Consultant for the California region. Venkatesh consult many firms in achieving their financial goals and business expansion funding. In Crashpadz, Venkatesh’s role would be to identify problems and apply technology as a solution to scale business in all dimensions. He is in the mission of building a software which will connect Crashpadz with their customers across the network in Customer Relations as well as Booking Management within 2020. He also took responsibility in identifying potential Investors for securing more funding and cash flow for the company to expand across the country. 5
  6. 6. 6 Immediate Expansion Plan The Company is now raising funds to acquire one of its current business assets. Once this initial backward integration is successful, the Company plans on undertaking a state-wide and nationwide expansion. The Company also aims to bring its concept throughout key locations in major hotspots across the globe. Crashpadz Inc. is seeking a first round of $320k - $1.4M in financing to acquire one of their Crashpads. In order to backward integrate one of its mainstay locations which has actively brought in an average of $13,000 per month and expected to return even more the second year in operation. One of the potential roadblocks for Crashpadz operation would be the complications between Landlord and Tenant. Any conflict of interest between the landowner and Crashpadz could cause potential threat to smooth business operations and also leased property gives us only a certain amount of flexibility in remodelling and furnishing. With the new laws that California passed this year (AB 1482) evictions have skyrocketed and that places Crashpadz at the risk of landlords. By becoming their own landlord Crashpadz will no longer have to worry about evictions and will build equity as mortgages get paid down, instead of losing money renting properties. Crashpadz now has the opportunity to purchase one of their existing running locations. Crashpadz pays around $ 100,000 in terms of current property rentals in 2019 alone and due to an increase in locations this year property rentals go over by 80%. Our business model would be more profitable when Crashpadz owns the properties and paying mortgage and gaining equity in the property, See (Attachment A). It also gives more flexibility and freedom in substantial renovations and redecoration of the properties to bring it up to Crashpad standards. Owning the properties and utilizing the revenue the business generates in paying down mortgages secures the company from the interruptions and disturbance from the property owners and helps to build equity in the properties for the company itself. At a capital infusion of $320k Crashpadz can put 20% down on a $1.4M purchase price of the 1640 Edgeworth property and finance the remaining 80% through a bank. At $1.4 Million Crashpadz can purchase the property in whole and the company would seek an asset backed loan, in which the loan was secured against the property itself. This is the first step needed to implement our backward integration strategy. For our horizontal integration strategy. Crashpadz seeks to buy commercial properties and activate our Crashpad hubs in which short term renters are placed. At a financing of $3.5 million and $5.5 million respectively. In addition to financing costs in buying the undervalued commercial building(s). Crashpadz also seeks a $1 million dollar credit line for covering costs of renovation in bringing the building(s) up to Crashpadz standards . Our first commercial property will be acquired in Daly City, California, 1784 Sullivan Avenue, (See Attachment B) which will hold approximately 84-88 guests. This commercial building has been abandoned now for many years and is in need of rehabilitation and more recently we were able to locate the owners and now have the opportunity to purchase the building and bring about a good use.We will make our commercial Daly City property as our hub to our San Francisco and Daly City residential properties for all guests who want to stay on a long term basis. Our commercial property will be modeled after our residential properties already in our network. We will obtain a permit to run a shared accommodation boutique hotel. The planned accommodation fits into future plans for the city, See "Daly City 2030, A Plan For The Future, 6
  7. 7. 7 Administrative Draft December 2011" ,http://www.dalycity.org/Assets/Departments/Economic+and+Community+Development/plan ning/pdf/General+Plan+Admin+Draft.pdf. Although the property has already gone through City Council and been approved for use as a 22 unit residential apartment complex. (Attachment B p.20) We would not need to demolish and reconstruct as our business would need to renovate the existing structure in order to bring the building up to city code and build out additional bathrooms and room renovations. The amenities within our commercial property will include a family room, self-use shared kitchen with family style dining room, movie room, gaming room and laundry room. Our second commercial property that will be acquired is located in San Rafael, California. This is a fully functional boutique hotel that has been since converted to long term rental use. The owners are not fully able to capitalize on the potential the property has in generating, See Proforma Statement herein attached as (Attachment C & C1, Pro Forma Statement of La Casa Grande). Crashpadz plans to revert the building back to its original use as a hotel, in doing so Crashpadz will run the hotel as shared accomodations with a 50/50 use of long term and short term guests similar to every location currently in its network. By doing so, Crashpadz should see a market cap rate of 6.81%. Over a one year time frame the building with generate revenue of $706,872 and GRM will increase to market GRM of 12.84 giving the building a valuation of $8.2 million. Calculations showing the breakdown of running a Crashpad business from this location are included as (Attachment D). We have included the financials of operating the business as a Crashpad showing all long terms, half long term and half short term and all short term. And we have included the potential of this property to generate exponential increases in revenue by acquiring additional rooms through the process of attrition. The building as it currently stands can support a $5.5 million dollar 30-year mortgage with a fixed 5-year amortized asset backed loan at 5.5% and still have a cushion. Even increasing to just market rates on current tenants would bring in a 10% increase in monthly revenue. Long-Term Expansion Plan Since the Company’s first three locations have achieved success, the Company will begin working on its long-term expansion plan. The entire scope of this plan is further outlined below. The execution of this long-term expansion plan is contingent on the Company’s ability to raise further capital to fund these initiatives. Phase 1: Commercial Property Acquisition • Crashpadz would like to raise $ 10 Million as its expansion goal for 2020 to acquire 2 Commercial buildings as a part of Crashpad to run short term rental to set up as its gateway for qualifying long term renters to its existing residential properties (refer Attachment D). • Crashpadz will expand outside of the Bay Area further in California and Nevada in 2020. Los Angeles and Las Vegas are two locations that Crashpadz are looking to expand in the near future. 7
  8. 8. 8 Phase 2: Licensing the Brand to Independent Operators • The Company will seek to license the Crashpadz Inc. brand to independent operators within the United States. These operations will be able to leverage the Company’s brand presence and will be able to list their properties on the Company’s main website to make online bookings. • Crashpadz Inc. will work to streamline its operational processes, interior design requirements, marketing strategies, and available amenities to ensure that independent operators adhere by the standards set forth by the Crashpadz Inc. brand. The Company will routinely monitor the online reviews and customer feedback of each operator as a means to better understand their performance. Phase 3: The Crashpadz Network Booking Software • Crashpadz Inc. intends to build a state of the art reservation management engine that will allow Guests to find and book Crashpadz within their area. Guests will still be able to book a stay at the Company’s properties through this new portal in a traditional website and Smartphone App. • Guests will have to create an account with Crashpadz and maintain prepaid credits to make reservations and the app will allow self check-in and also manage their reservation. The app lets know about the neighbors (members inside the shared room) and also have options to contact customer support and also report any issues or grievances. • Making new reservations, Making changes to an existing reservation or transferring the reservation inside the network and also cancel the reservations. • The new booking engine will allow guests to choose the bed which they would like to book instead of being assigned one automatically by the system. Current Performance Crashpadz Inc.’s flagship property features over five co-ed bedrooms with multiple bunk-beds resulting in a total capacity of 26 guests at any given time. Demand has remained consistently high as the property is almost fully booked every month. With an average price of $42.40 per night, SFO Crashpad routinely brings in over $13,000 per month at a net income margin of over 50%. DC Crashpad and SFC Crashpad as well performed more than expectations in 2019 within 6 months of operations making it highly profitable. The Company has been able to double its gross every single year since 2015. The Company’s ability to generate significant volume with minimal overhead (approximately $5,000/month) is a testament to its highly profitable and lean business model. 8
  9. 9. 9 Meet the Team Crashpadz Inc. was founded by Zameer Azam with the goal of providing affordable accommodation in the Bay Area, where hotel prices can be as high as $338/night. He is joined by his business partner Jason Voelker in 2017. The team is extremely passionate and carrying years of experience in Real Estate and Hospitality industry. The team closely works with guests in order to understand their needs and provide them with the best stay possible. Venkatesh Venkatasubramanian joining in as a CTO of the company in 2020 carry more than 5 years experience in the Information Technology industry adding value to the company's long term goals. There are currently 5 house managers and 4 Janitorial staff. Value Proposition Key Price Advantage Statista reports that the average daily rate for hotels in San Francisco was $338 – the most expensive in the world. This has resulted in limited accommodations for travelers in San Francisco. Crashpadz Inc. solves this problem by offering beds at $42.40 per night, which is more competitive than most hotel operators, Airbnb’s, and other short-stay operators in the area. Flexible and Convenient Crashpadz Inc. offers flexible rates for travelers with unique life circumstances and is able to accommodate short-term or long-term stays. Guests have the option to book a bed at a nightly, weekly, or monthly rate without the need for a security deposit. Crashpadz Inc. even offers a 100% refund on accommodations as long as the cancellation is made three days prior to a listing’s local check-in time. Key services such as free WIFI, self-check-in procedures, and flexible check-out times are also provided to ensure a more convenient stay at its property. Community-Driven Crashpadz Inc.’s main differentiator in the short-stay marketplace lies in its warm, friendly, and home-like social settings. Crashpadz Inc.’s priority is to make everyone feel welcomed at its crashpad and the Company goes to great lengths to ensure their continued satisfaction. Guests are able to interact with each other in a dedicated common room and are invited on multiple social activities such as bar crawls, guided tours, and more. Profitable Business Model Crashpadz Inc.’s business model presents an attractive growth and yield proposition, with good margins through significant volume and generally low costs. A lack of staff overhead results in low monthly expenses of $5,000, which has enabled the Company to boast an enviable net income margin of over 50%. 9
  10. 10. 10 Highly Scalable Crashpadz Inc.’s first location is already producing $168,000 per year. Redfin reports that the average price of a home in Daly City is approximately $988,000. Based on the performance of the Company’s first location this would lead to a cap rate of 17%. Combined with lower startup costs, this will easily allow Crashpadz Inc. to pay off its financing for its new properties while generating a superior return than most other properties. Strategic Locations The Company Crashpadz are located in a safe neighborhoods and are within walking distance of major public transit networks connected to San Francisco. The Company will continue to adhere by this criterion when selecting new properties in order to ensure a sustained competitive advantage for its crashpadz. Every new location will also include a thorough study of demographic trends, the presence of competitors, and the distance of the property to major tourist hotspots or economic hubs. Exceptional Facilities The Company strongly believes that every guest deserves clean beds and shared facilities. The Company’s current Crashpadz also offer shared common spaces, designated bathrooms, fully functioning kitchens, and snack machines. The Company will ensure these 5S standards and offerings are kept for each new property especially as the business grows. 5S • Save • Secure • Share • Self-Service • Standardized Testimonials “Best place to stay when you're headed to the bay! I often stay here when I'm in the area and have never had any problems. Everyone is always inviting and it's also conveniently located near an ample amount of grocery stores and great eateries!” Jennifer L., 6/17/2018 on Yelp 10
  11. 11. 11 Photos of the Crashpadz Properties 11
  12. 12. 12 Business Model The Company primarily generates revenue through daily, weekly, and monthly bookings of beds within shared rooms. The Company’s flagship crashpad currently has four bedrooms and one gaming room that can accommodate over 26 guests. Three of the crashpads bedrooms can hold over six people while the remaining two can hold up to four people each. Within five years from now, the Company aims to own and operate at least 20 privately-held crashpads across the United States and in key locations around the world. 12
  13. 13. 13 Room Daily Rate Weekly Rate Monthly Rate Golden Gate Room $40 $200 $650 MoTown Room $40 $200 $650 90's Room $40 $200 $650 Bay Room $40 $200 $650 EDM Room $40 $200 $650 Room Amenities Golden Gate Room WIFI, TV, Shower, Bath, and Kitchen Mo-Town Room WIFI, TV, Shower, Bath, and Kitchen 90's Room WIFI, TV, Shower, Bath, Kitchen, and Towels EDM Room WIFI, TV, Shower, Bath, Kitchen, and Towels Bay Room WIFI, Shower, Bath, Kitchen, and Towels Market Opportunity Hostels* have marked a major transformation of the hospitality industry, and many travelers are now attracted to alternative accommodations. As a result, the market opportunity for Crashpadz Inc. is vast and growing. In addition, there are several factors pertaining to the Company’s industry and its local market that make a compelling case for its expansion. These are further outlined below. *Hostels: We use a hostel as a comparative industry. 13
  14. 14. 14 The Growth of the Shared accomodation in the US According to IBISWorld, hostel accommodations represent a $675 million opportunity in the United States. Hostels are quickly becoming the fastest growing segment in the market, due to their appeal among Millennial travelers (aged 18-34) that prioritize affordability, convenience, and the opportunity to meet other like-minded travelers. More importantly, this age category routinely spends over $200 billion on travel every year, higher than any other age group in the US. This combined with the popularity of San Francisco among youth travelers will drive further demand for Crashpadz Inc.’s offerings, increasing its ability to generate revenues. Booming Tourism in Bay Area & California Crashpadz Inc. specifically appeals to guests seeking short-term accommodation near San Francisco for tourism or business purposes. San Francisco welcomed over 25.5 million tourists (both for leisure and business) in 2017 up 1.4% from 2016. Total spending by visitors was $9.10 billion, up 1.4% over $8.98 billion in 2016. Furthermore, the number of tourists visiting San Francisco is expected to hit 26.3 million by 2018, an increase of 3.0% from 2017. More tourism will lead to a larger number of guests in need of short-term accommodation, significantly benefitting Crashpadz Inc.’s operations and its overall expansion plan. Attractive Areas of Expansion Each of the Company’s potential areas for expansion boast high levels of spending on lodging. Based on data collected from ESRI, total spending on lodging within a 1-mile radius within these cities amounted to $6.8 million in San Bruno, $17.4 million in Oakland, and $51.1 million in Daly City. Within a 5-mile radius, these figures grow to $74.7 million in San Bruno, $143 million in Oakland, and $170 million in Daly City. The data proves that a potent market opportunity exists in all three areas the Company is considering for new crashpad properties. 14
  15. 15. 15 Industry Analysis Bed & Breakfast and Hostel Accommodations Industry Overview Crashpadz Inc. is a “crashpad” and hostel accommodations company that offers hostel-type rooms with bunk beds for customers that intend to stay on a daily, weekly or monthly basis. A crashpad is a temporary place to stay, most commonly used by airline crew members (pilots, flight attendants, etc.) in between their flights. Thus, the Company primarily competes under the Bed & Breakfast and Hostel Accommodations industry in the US. This industry comprises establishments that are primarily engaged in providing short-term lodging. Excluded from this industry are hotels, motels and casino hotels. Figure 4: Bed & Breakfast and Hostel Accommodations in the US: Industry Snapshot (IBISWorld) Industry Performance The Bed and Breakfast and Hostel Accommodations industry has benefited over the five years to 2018 from a growing economy. Driven by an increase in travel rates and spending during the five-year period, which has positively affected all travel industries, demand for bed and breakfast and hostel accommodation has risen steadily since 2013. Trips by both domestic and foreign tourists have grown over the past five years as the economy has improved. As a result, industry revenue is expected to grow at an annualized rate of 4.2% during the five-year period to $3.2 billion. This includes an increase of 1.4% in 2018 alone. Figure 5: Bed & Breakfast and Hostel Accommodations in the US: Historical and Future Revenue Estimates, 2013-2023 (IBISWorld) Industry Outlook Over the five years to 2023, industry revenue is forecast to increase at an annualized rate of 1.7% to $3.5 billion. The resurgence of travel rates is expected to continue, and travel spending is projected to increase over the next five years as the economy improves. Consumer spending is expected to increase an annualized 1.8% over the next five years. IBISWorld estimates that during the same period, international arrivals will increase at an annualized rate of 3.8%, while domestic travel will increase an annualized 1.6%. The influx of tourist dollars will likely bolster revenue for bed and breakfasts (B&Bs) and hostels. 15
  16. 16. 16 Key Industry Trends Growth of Hostels The hostel component of this industry is expected to continue its expansion, particularly into large cities. Hostels will invest in higher-quality facilities, enabling them to command higher room rates as they compete against homeowners and renters making their own lodging available through websites like Airbnb. Hostels will be able to offer some significant competitive advantages to hold on to their market share, such as providing sightseeing and cultural tours, day excursions, bar crawls and other value-adding services that are popular among hostel travelers. Many travelers will also seek the opportunity to meet other like-minded young travelers that they are unlikely to meet in expensive hotels or during stays in other private accommodations. Industry Landscape The industry will continue to remain primarily a small business-focused industry, despite increasing pressure for establishments to combine forces to ward off competition from hotels and providers of informal accommodation. Establishments will increasingly rely on the internet, particularly specialty booking sites, to find customers and maximize their occupancy rates. It is now necessary for industry operators to understand review sites to learn and better understand the preferences of their customers. Products and Services Segmentation Figure 6: Bed & Breakfast and Hostel Accommodations in the US: Products and Services Hostels Other accommodations, including hostels, make up 21.1% or $675 million of industry revenue in 2018. Youth hostels are commonly identified by having low rates, quite often ranging between $15.00 and $50.00 per person per night, depending on the facilities and location. Typical hostel facilities include: separate gender and shared accommodations in dormitories that have between six and 10 beds; shared, but separate, gender shower and restroom facilities; and common or shared facilities, including kitchen, lounge and entertainment areas. Some hostels also offer semiprivate rooms (with anywhere between two and four beds). Whether or not bed linens and towels are provided can also vary among establishments. Some offer on-site educational and other programs linked with local tour guides and tour companies. Nearly all hostels now supply guests with complementary wireless internet. 16
  17. 17. 17 Market Analysis Market Overview Crashpadz Inc. will be targeting a wide variety of potential customers in San Francisco. The Company will ensure that its crash pad and hostel accommodations services fit the needs and expectations of foreign and domestic travelers, transport crews (Uber/Lyft Drivers), general consumers and individuals who are transitioning to a new job or new home. Bed & Breakfast and Hostel Accommodations Major Markets The majority of hostel and bed and breakfast (B&B) travelers are leisure travelers, which make up 80.0% of industry revenue. Among leisure travelers, 58.2% of industry customers are vacation travelers, while 21.8% are family travelers. Business customers generate 12.0% of industry revenue while an additional 8.0% comes from other sources, including business meetings and special events. Figure 7: Bed & Breakfast and Hostel Accommodations in the US: Major Markets Youth and Backpacker Hostels In general, these facilities are targeted at international and domestic backpacker visitors. Guests sometimes have to be members of a domestic or international hostel association. Facilities are generally used by younger people, though there are no age restrictions. Most international guests come from Europe (including the United Kingdom), Canada, Australia and New Zealand. While backpackers may seek out inexpensive lodgings for the night, they usually spend the bulk of their travel budget on cultural, environmental and other unique attractions and experiences. Most of the revenue of hostels is derived from accommodation. There may also be some additional revenue from commission on tours booked by guests through the hostel and from the sale of some everyday need items, which may be stocked. Consumer Trends Among Younger Travelers The Appeal of Hostels Among Millennials The enormous growth in the hostel industry has been spurred by millennial travelers (aged 18-35) who are spending more money on longer trips and want to see as much of the world as possible. This age group has revolutionized the hospitality industry as a whole as millennials overwhelmingly prioritize social interactions and shared adventures with newfound friends against the average traveler population. Hostels have swiftly become the preferred choice for millennials they typically offer amenities suited to their needs and expectations. These amenities often include free wireless access, guided tours, bike rentals, libraries and social activities to name a few. A report by PWC on the hostel industry also found that an overwhelming 70% of hostel travelers are millennials. The report goes on to further state that the top reasons among millennials for choosing hostels were: 17
  18. 18. 18 • Low Cost (44%) • Convenient Locations (44%) • High Overall Value for Money (43%) • Opportunities to Meet Other Travelers (31%) All of which the Company provides through its unique hostel format. Millennial Spending Habits According to a recent report by PWC, millennials tend to spend at greater levels than the average traveler population despite being much younger and having a lower overall average income. In fact, a 2018 survey by Travelport found that millennials on average spend the most out of any age group with over 34% planning to spend over $5,000 on upcoming vacations. Moreover, Travelport also found that a whopping 55% of millennials surveyed plan to travel in the next 12 months, much higher than the 31% of Generation X respondents and the 20% of Baby Boomer Respondents. According to a 2016 report by Futurecast, millennials spend on average $200 billion on travel every year and this figure is projected to grow as the number of travelers among this age group increases and reach their most lucrative spending years. San Francisco Tourism Market According to San Francisco Travel Association (SFTA), over 25.5 million guests were expected to arrive in the area in 2017. These individuals were also estimated to spend a total of $9.10 billion, representing a 1.4% growth from the previous year. The large volume and spending of travelers to the city represents a robust market for the Company’s services. Visitor Statistics A total of 25.2 million visitors and convention participants were noted to arrive in San Francisco for 2016. Each day, the city receives an average of 68,998 visitors. Overall spending for the tourism market in 2016 amounted to $8.9 billion, with each visitor spending an average of $356.45 per day. Figure 8: San Francisco Visitor Statistics (SFTA) Overall Visitor Statistics 2016 Total visitors and convention participants 25.2 million Visitors in San Francisco per day 68,998  Visitor spending in San Francisco per day $24.5 million Total tourism direct spending $8.9 billion Average daily expenditure for all visitors (1) $356.45 Accommodation Statistics In 2016, the average daily expenditure of visitors in San Francisco amounted to $298.03. This was mostly constituted by accommodations as the average room rate for the city was $252.92. 18
  19. 19. 19 The overall room demand in the year amounted to 10.5 million, where 7.4 million came from transient room demand. Figure 9: San Francisco Accommodation Statistics (SFTA) Accommodation Statistics 2016 Average daily expenditure per general visitor staying in hotels/motels(2) $298.03 Average daily room rate $252.92 Hotel occupancy 85.5%  Room demand 10.5 million  Transient room demand 7.4 million  Total group room demand 2.6 million  Visitor Profile The visitors of San Francisco were relatively affluent, with an average household income of $94,637. Almost a quarter of visitors were visiting San Francisco for the first time. Figure 10: San Francisco Visitor Profile (SFTA) Visitor Profile 2016 Average Age 40.1 Average Annual Household Income $94,637 Average Length of Stay in City 2.5 Nights First Time Visitors 24%  Female 51% Male 45% Prefer not to answer 4% San Francisco Airport Arrivals A great majority of arrivals in the San Francisco International Airport came from foreign destinations. In 2016, 85.6% of flights came from other countries. The top three origins of international arrivals were Vancouver International Airport (2,979 flights), London Heathrow Airport (1,962 flights) and the Hong Kong International Airport (1,605). Among domestic flights, the top origins were Los Angeles International Airport (33,884 flights), the Seattle-Tacoma International Airport (18,017 flights) and the Las Vegas McCarran International Airport (15,372 flights). Figure 11: San Francisco Airport Arrivals (SFTA) San Francisco International Airport Statistics 2016 Passenger Volume 53,106,505 Number of Flights  204,904 International   175,354 Domestic   29,550 Total Seat Volume  31,199,614 International   23,948,976 Domestic   7,250,638 19
  20. 20. 20 Uber and Lyft Drivers According to the San Francisco Transportation Network Company Activity (SFTNCA), there are 45,000 transport network company (TNC) drivers operating in the San Francisco as of June 2017. Among the TNC businesses operating in the city, the SFTNCA reports that only 29% are actually based in the city. Among the remaining businesses, 61% are actually distributed across different counties in the bay area and 10% are based in locations outside the bay area. Because a great percentage of TNC drivers come from outside San Francisco, there is also large demand for temporary living facilities such as Crashpadz Inc.. The breakdown of TNC businesses by their registration areas is found in the table below. Figure 12: TNC Businesses in San Francisco by Area of Registration COUNTY PERCENTAG E Alameda 21% Contra Costa 12% Marin 2% Napa 0% San Francisco 29% San Mateo 16% Santa Clara 6% Solano 2% Sonoma 1% Outside Bay Area 10% TOTAL 100% Local Target Markets Crashpadz Inc. will open two new properties potentially within San Bruno, 94066; Oakland, 94610; and Daly City, 94015. The Company’s expansion aims to better capture the large potential demand for its services in San Francisco. According to the San Francisco Office of Economic and Workforce Development, the city’s labor force is constituted by 734,665 individuals. As of July 2018, the Bureau of Labor Services estimates that employment in the area grew by 1.6%. Newly employed individuals may need short-term living facilities, especially those who are coming from other areas outside the city. Further, among the entire work force of the city, more than a third (247,465) are in-bound commuters to San Francisco. These individuals are also potent target markets for the Company. In addition to the different target markets presented above, Crashpadz Inc. will also aim to attract individuals who are transitioning to their new homes. According to Trulia, there were 15,432 homes that were sold in San Francisco in the past 12 months. These home buyers may also require a temporary place to stay while they are transferring to their newly bought homes. In terms of seasonality, based on data provided by Trulia, home sales typically reach its peak in 20
  21. 21. 21 June - July. It then remains relatively stable until January, where it starts to decline. February, March, and April are typically low months for the San Francisco housing market. Additional information regarding the population, income, demographics, and spending of the Company’s local target markets are provided in the following tables. San Bruno - 94066 Consumer Spending The spending for lodging within a mile radius from San Bruno is at $6,870,956 and shoots up to $38,417,550 and $74,739, 607 within a 3-mile and a 5-mile radius from San Bruno, respectively. 21
  22. 22. 22 Figure 13: Consumer Spending (ESRI, 2017) Variable 94066, San Bruno, California (1 mile) 94066, San Bruno, California (3 miles) 94066, San Bruno, California (5 miles) Travel - Lodging on Trips $6,870,956 $38,417,550 $74,739,607 San Bruno Real Estate Trends According to Trulia, median home sales prices in San Bruno increased by $243,000 (28%) over the past year. Average price per square foot also rose to $915 from $737. In terms of length of commute, Google Maps estimates that driving to San Francisco from San Bruno takes 24 mins via US -101 N and 28 mins via I-280 N. Additionally, it takes 22 - 26 mins via transit options to reach San Francisco. Further, Trulia notes that San Bruno is a generally safe place to live in. Specifically, areas traversed by Fernwood drive, Berkshire Drive, Green Avenue, Georgia Avenue, Rollingwood Drive, Shelter Creek Lane, and Pepper Drive were highlighted by Trulia as safe neighborhoods. The table below the median sales price of properties by the number of bedrooms. Based on Trulia’s information, the biggest jump in prices was from 1-bedroom properties, increasing by 22.4% compared to the last year. Figure 14: San Bruno Median Sales Prices (Trulia) No. Bedrooms Jun 20 - Sep 19 YOY Growth 3 months prior 1 year prior 5 years prior 1 Bedroom $551,000 22.40% $545,750 $450,000 $283,000 2 Bedroom $850,000 17.20% $810,000 $725,000 $477,000 3 Bedroom $1,250,000 18.90% $1,215,000 $1,051,000 $735,000 4 Bedroom $1,405,000 17.10% $1,367,000 $1,200,000 $727,000 All Properties $1,108,000 28.10% $1,075,000 $865,000 $523,500 22
  23. 23. 23 Oakland - 94610 Consumer Spending The spending for lodging within a mile radius from Oakland is at $17,451,812 and increases to $81,778,264 within 3 miles and $143,256,718 within 5-miles from Oakland. Figure 15: Consumer Spending (ESRI, 2017) Variable 94610, Oakland, California (1 mile) 94610, Oakland, California (3 miles) 94610, Oakland, California (5 miles) Travel - Lodging on Trips $17,451,812 $81,778,264 $143,256,718 Oakland Real Estate Trends According to Trulia, median home sales prices in Oakland increased by $90,000 (14%) over the past year. Average price per square foot has also gone up to $598 from $537. In terms of 23
  24. 24. 24 length of commute, Google Maps estimates that driving to San Francisco from Oakland takes 27 mins via I-80 W. Additionally, it takes 13 - 20 mins via transit options to reach San Francisco. Further, Trulia notes areas including North Stonehurst, Glenview, Upper Rockridge, Crestmont and Sequoyah are generally safe neighborhoods in Oakland. The table below the median sales price of properties by the number of bedrooms in the area. Based on Trulia’s information, the biggest jump in prices was from 2-bedroom properties, increasing by 17.2% compared to the last year. Overall, the value of properties in the area have grown by 70.5% compared to the past five years. Figure 16: Oakland Median Sales Prices (Trulia) No. Bedrooms Jun 20 - Sep 19 YOY Growth 3 months prior 1 year prior 5 years prior 1 Bedroom $506,500 4.00% $527,500 $487,000 $315,000 2 Bedroom $703,000 17.20% $672,500 $600,000 $410,000 3 Bedroom $864,500 10.80% $900,500 $780,000 $495,000 4 Bedroom $1,020,000 7.30% $1,200,000 $951,000 $684,500 All Properties $750,000 13.60% $735,000 $660,000 $440,000 24
  25. 25. 25 Daly City - 94015 Consumer Spending The total spending for lodging within 1-mile radius amounts to $8,778,196, $51,183,474 within the 3-mile radius and grows further to $170,308,176 within the 5-mile radius from Daly City. Figure 17: Consumer Spending (ESRI, 2017) Variable 94015, Daly City, California (1 mile) 94015, Daly City, California (3 miles) 94015, Daly City, California (5 miles) Travel - Lodging on Trips $8,778,196 $51,183,474 $170,308,176 25
  26. 26. 26 Daly City Real Estate Trends According to Trulia, median home sales prices in Daly City increased by $105,000 (12%) compared to the previous year. Average price per square foot also increased to $784 from $671. In terms of length of commute, Google Maps estimates that driving to San Francisco from Daly City takes 17 -18 mins via I-280 N. Transit options from the area take only slightly less time, at 16 minutes, to reach San Francisco. Further, Trulia notes that Daly City is a safe place to live in. It highlights areas including Bayshore and the nearby town of Colma as areas that are safe. The table below the median sales price of properties by the number of bedrooms in Daly City. Huge increments in prices for 1-bedroom properties and 4-bedroom properties were reported by Trulia. Overall, the value of properties in the area have grown by 65.3% compared to the past five years. Figure 18: Daly City Median Sales Prices (Trulia) No. Bedrooms Jun 20 - Sep 19 YOY Growth 3 months prior 1 year prior 5 years prior 1 Bedroom $537,500 22.90% $476,000 $437,500 $296,000 2 Bedroom $837,000 9.80% $882,500 $762,500 $451,500 3 Bedroom $1,015,000 15.70% $1,020,000 $877,500 $625,500 4 Bedroom $1,244,000 23.80% $1,189,000 $1,005,000 $684,000 All Properties $975,000 12.10% $985,000 $870,000 $590,000 Competitive Analysis Competitive Overview According to IBISWorld, the Bed & Breakfast and Hostel Accommodation industry concentration is low. Most bed and breakfast (B&B) establishments were reported to be owner-occupied and having only eight rooms. In 2018, the top four industry players earn well under 5.0% of total industry revenue. Hostels, however, can vary from 25 beds in rural areas to up to 500 beds in central city locations. Due to the nature of the industry and its requirement to maintain very high levels of personal hospitality with guests, few operators run more than one establishment. Also, it is not surprising that nearly 87.0% of establishments are small-business operators with nine or fewer employees. There are also no operators that employ more than 250 people. Given the structure of this industry, IBISWorld estimates that this concentration level is unlikely to change over the next five years. 26
  27. 27. 27 Crashpadz Inc. will be directly competing with Marriot, Hotel V, Budget Inn, and Motel 6. The Company will supplant its competitors by providing superior services and amenities. The Company places great importance in the cleanliness and overall maintenance of its beds, rooms and the entire establishment. Further, Crashpadz Inc. will be providing movie projectors, coin operated washers & dryers, virtual reality game, Play Station 4s, Xbox 1s, and television sets. Additionally, Crashpadz Inc.’s target locations provide easy access to transportation as well as safe and secure communities. The Company further ensures the safety of its guests by installing CCTV cameras in key areas of each establishment. These features of the establishment are provided in order to provide guests with the best possible experience during their stay. More importantly, Crashpadz Inc. will be providing all mentioned services, features, and benefits at very competitive prices, much lower compared to other hotels and motels in its various target locations. These elements of the Company’s strategy will enable Crashpadz Inc. to outpace its competitors, regardless of their company size and years of operation. Major Competitors Figure 19: Marriott Marriott Company Overview Marriott International, Inc. operates, franchises, and licenses hotel, residential, and timeshare properties worldwide. As of September 5, 2018, it operated approximately 6,700 properties under 30 hotel brands in 130 countries and territories. Marriott International, Inc. was founded in 1927 and is headquartered in Bethesda, Maryland. The San Francisco Marriott Marquis Hotel has 39 floors, 1362 Rooms, 138 suites, 65 meeting rooms, and a 128,245 sq ft of total meeting space. Website https://www.marriott.com/ Location and Contact Details 780 Mission St, San Francisco, CA 94103, USA 415-896-1600 Services and Price Points Room Rates : San Francisco Marriott Marquis Guest room, 2 Double, Low floor: $259 Guest room, 1 King, Low floor: $269 Guest room, 2 Double, City view: $269 Guest room, 2 Queen, Low floor: $294 Larger Guest room, 2 Double, City view, Corner room: $299 27
  28. 28. 28 Larger Guest room, 1 King, City view, Corner room: $314 Executive Suite, 1 King, Low floor: $319 Guest room, 2 Queen, City view: $319 1 Bedroom Junior Suite, King: $334 Larger Guest room, 2 Queen, City view, Corner room: $334 M Club lounge access, Guest room, 1 King: $359 Room Rates: San Francisco Union Square 1 King Bed: $249 2 Double Beds: $249 2 Double Beds, Deluxe Guest Room: $264 1 King Bed, Bay View: $284 2 Double Beds, Bay View: $284 2 Double Beds, City View: $284 1 King Bed, Corner , Junior Suite: $309 1 King Bed, Bay View, Corner, Junior Suite: $344 Other Amenities Full service spa Fitness center Meeting event space Parking Internet access Customer Reviews Google Reviews: 4.4 out of 5 (5,032 reviews) TripAdvisor: 4 out of 5 (6,801 reviews) Yelp: 3.5 out of 5 (946 reviews) Facebook: 4.3 out of 5 stars (2,443 reviews) Key Strengths and Weaknesses Strengths: Great panoramic view of San Francisco, close and accessible to key transportations, trusted global brand Weaknesses: Expensive rates. 28
  29. 29. 29 Figure 9: Budget Inn Budget Inn Company Overview Budget inn is a 2.5 star, non-smoking hotel accommodation according to TripAdvisor. Website Budget Inn does not have its own website. Links provided in review websites Location and Contact Details 1139 Market St, San Francisco, CA 94103-1513 Services and Price Points According to TripAdvisor, Budget Inn has 20 non-smoking rooms. Pricing estimates in Yelp indicate that the rates of Budget Inn are very cheap. Other Amenities Free Internet access Customer Reviews Google Reviews: not available TripAdvisor: 1.5 out of 5 (73 reviews) Yelp: 1 out of 5 (36 reviews) Facebook: not available Key Strengths and Weaknesses Strengths: Cheap. Weaknesses: Lack of cleanliness, very poor reviews, does not have its own website. 29
  30. 30. 30 Figure 10: Motel 6 Motel 6 Company Overview Motel 6 provides boarding and lodging services. It was formerly known as La Quinta Inn and changed its name to Motel 6 in August 2013. Motel 6 is based in Tulsa, Oklahoma. As of January 18, 2017, Motel 6 operates as a subsidiary of Maankee Hospitality LLC. Motel 6 operates an establishment in Geary Street, San Francisco, CA 94109. Website https://www.motel6.com/en/motels.ca.san-francisco.4330.html Location and Contact Details 895 Geary St, San Francisco, CA 94109, USA 415-441-8220 Services and Price Points Room rates: +$10 for each additional adult 1 King bed: $175.99 2 King beds: $175.99 2 Queen beds: $175.99 2 King beds, Suite: $225.99 Key Amenities Kids stay free Free expandable cable Pets allowed Free coffee Free local calls Free Wifi Other Amenities Disabled-friendly rooms Accessible to mass transit Elevator Beach within 10-miles Airport within 20-miles Refrigerators in guest rooms 30
  31. 31. 31 Customer Reviews Google Reviews: 4.5 out of 5 (5 reviews) TripAdvisor: 3 out of 5 (263 reviews) Yelp: 2.5 out of 5 (58 reviews) Facebook: not available Key Strengths and Weaknesses Strengths: Decent rooms, ample pricing of rooms for its quality Weaknesses: Some parts of the neighborhood are quite loud and unsafe, Parking space though free is accessible to anyone thus compromising safety, Figure 9: Hotel V Hotel V Company Overview Hotel V is a boutique hotel that is located 7 minutes away from the San Francisco International Airport. It features luxury accomodations with highend décor, furniture and others. It also highlights its proximity to popular landmarks, city attractions, restaurants, transportation and shopping centers. Website https://www.hotelvsfoairport.com/ Location and Contact Details 222 S Airport Blvd, South San Francisco, CA 94080, USA 650-589-9055 Services and Price Points Room rates: +$10 for each additional adult Queen: $100.28 King: $109.48 Double Queen: 118.68 Queen ADA Accessible: $100.28 Other Amenities Free WIFI and Data Ports 31
  32. 32. 32 Free Local Calls Room Appliances Full bath Cable TV ADA Accessible Rooms Customer Reviews Google Reviews: 3.6 out of 5 stars (192 reviews) Tripadvisor: 3.5 out of 5 stars (650 reviews) Yelp: 3.5 out of 5 (51 reviews) Facebook: not available Key Strengths and Weaknesses Strengths: Proximity to San Francisco International Airport. Decent website and online booking function. Weaknesses: Customers complain about poor service, different pricing (as to what is advertised in the website), rude staff, poor reservation management and more. SWOT Analysis Strengths Weaknesses • Lowest price in Market • Low operating costs • Ability to generate significant volume due to multiple beds in each bedroom • Offers one of the best cap rates • Clean and well-maintained facilities • Useful amenities for every traveler • Good Social Media Engagements • Flagship property is strategically located near public transit, major highways, and within a safe neighborhood • Unique hostel format that is extremely popular among younger travelers • Limited control of rental properties. • Crashpadz Inc. pays over 150k in rent and gains no equity in properties. • Crashpadz Inc. needs a dedicated acquisition officer. 32
  33. 33. 33 Opportunities Threats • Website has the potential to become a travel aggregator for hostel listings • The ability to license the brand to other independent operators provides lucrative franchising opportunities while growing the brand without significant overhead • Global expansion also offers lucrative opportunities to profit from tourism and economic growth in other countries • Political, economic, and social issues beyond the Company’s control may threaten the value of its real estate and/or may cause a decrease in tourist arrivals • Any downturn in the local economy of San Francisco may decrease the number of people going to the Bay Area for business purposes • As younger travelers become more affluent they may switch to more expensive forms of accommodation Marketing Plan Marketing Overview Crashpadz Inc. will continue to implement an integrated marketing strategy, relying heavily on digital marketing and direct marketing initiatives to expand its business and become the go-to Crashpad for guests seeking short-term accommodations within the Bay Area. Crashpadz Inc. will increase its reach within the Bay Area by continuing its marketing efforts on several lodging reservation websites such as www.booking.com, www.expedia.com, www.hostelworld.com, and more. Crashpadz Inc. will ensure that each new property is hosted on these websites while providing a budget for web ads and pay-per-click marketing to boost their presence among potential customers. Crashpadz Inc. also has its own booking website (https://www.uscrashpadz.com/) which will also be updated with new properties. The Company deeply understands the long-term importance of good feedback and customer relations on various social platforms and review sites. Thus, Crashpadz Inc. will continue building positive experiences for every customer in order to encourage more positive word-of-mouth referrals and five-star reviews for its current and future locations. We use Review Boost as our online reputation management partner. These initiatives will help Crashpadz Inc.’s reputation online and will help deliver more guests to the business as it grows. Marketing Goals The goal of the Company’s marketing plan is to raise awareness and demand for the Company’s current and future locations while reinforcing an image based on convenience and comfort. Doing so will result in the Company’s ability to attract more guests and acquiring a greater share of the overall market. Crashpadz Inc. will continue to use the following marketing 33
  34. 34. 34 channels and tactics to grow demand for accommodations and strengthen customer satisfaction levels. Direct Marketing Initiatives Word-of-Mouth Referrals Positive client testimonials and reviews are one of the strongest forms of advertising and can be a key decision point for many potential customers. Data from the White House Office of Consumer Affairs shows that news of bad customer service reaches more than twice as many ears as opposed to praise for a good service experience. Furthermore, loyal customers are worth up to ten times as much as their first purchase. Cultivating satisfied clients is therefore extremely valuable and profitable towards a business as their opinion and endorsements with colleagues, friends, or family can help result in significant recurring demand for accommodations with Crashpadz Inc. Every positive experience with Crashpadz Inc. encourages guests to share their experience with others. Understanding this, the Company will continue to provide positive experiences worth sharing, and a rewards system for those who do. 34
  35. 35. 35 Operational Structure Corporate Information Ownership Zameer Azam/Jason Voelker Business Entity Crashpadz Inc./S-Corp State of Registration California 35
  36. 36. 36 Corporate Organizational Tree 36
  37. 37. 37 37

×