The document discusses new models for donor-funded ecotourism projects that improve financial sustainability. It analyzes a World Bank/IFC study on ecolodge business models and a USAID-funded ecolodge in Sri Lanka. The study found ecolodges have long break-even periods but growing demand if they ensure wildlife, access, and quality information. It recommends donor funds be channeled through local companies and cover monitoring, evaluation and technical assistance rather than operational costs. The Sri Lanka project was a successful public-private model with a $1 million private investment and $900k in USAID support for technical and community aspects.

1. Ecolodge Development Models
A New Paradigm in
Donor Project Interventions
By
Megan Epler Wood

2. CONTEXT
Private Sector’s Pivotal Role in the
implementation of ecotourism in
LDCs
Based on:
• World Bank/IFC Study on Business, Market, &
Technical Assistance Models for Ecolodges
• Competitiveness US AID Model Ecolodge project
in Sri Lanka

3. OBJECTIVES
Improving the Financial Sustainability
of Donor Interventions in
Ecotourism:
• Channeling Funds Through Local Socially and
Environmentally Responsible Companies
• Performing Advance Business & Market Due
Diligence
• Funding Monitoring & Evaluation
• Triple Bottom Line Cost-Sharing

4. Key Findings IFC Study
• Determinants of Demand
– Wildlife, Access, Quality of Information,
Destination Image
• Ecolodge Business Fundamentals
– Long break even period of 4-5 years
– Emerging business sector with 10% annual growth
potential
– Low marketing costs of 10%, high expertise required
– Need for patient investment, mix of loans and grants

5. Results of IFC Study
• Ecolodge Technical Assistance Needs
– Market & Business Systems
– Technical Systems to reduce waste, water,
energy
– Guide & Business Training
– Triple Bottom Line Approaches
• Recommended Approach
– Business Mentorships
– Support from Senior Ecotourism Businesses

6. Sri Lanka Case
Sri Lanka Model
Ecolodge
• 4 year research program --
Tourism Cluster Identifies
Market Opportunities
• Private Sector Model
Ecolodge Company -- $1
million investment via
consortium of leading
hoteliers

7. Sri Lanka Case
• $ 900K US AID Support towards:
– Technical Assistance on Environmental
Systems
– International Market Outreach
– Guide & Business Training for Staff
– Community Development Program
– Trust Fund Strategic Planning
– Evaluation & Monitoring
• Biodiversity
• Sociocultural
• Economic development

8. Strategic Recommendations
Ecolodge Business Models
• Develop competence, awareness, & create
alliances within business community
• Develop strategic market approach
• Fund triple-bottom line costs - do not shift this
burden onto private sector until there are adequate
profits - this is an emerging economy
• Develop long-term plan for replication of model
• Work towards a profitable model that will fund
triple bottom line in long-term

9. For more information:
EplerWood International
www.eplerwood.com