Simulation Scenario Context


Published on

  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Simulation Scenario Context

  1. 1. Simulation Scenario Context: ColmarCo 1.0 ColmarCo – the Business Context. ColmarCo is a (hypothetical) company that is engaged in many elements of the Tourism Industry. It has three key divisions: 2.0 TransCol Division. (incorporating the following brands / profit centres) • • • FlyCol: A budget airline with 100 planes operating in Western Europe and seeking to expand in Eastern Europe, the Far East and China. (Think a sort of EasyJet or Ryanair) CoachCol: A Europe-wide coach network operating in the countries to which FlyCol flies AutoCol: A Western Europe-wide hire car company with centres in most major cities and airports. (Think Europcar) Critical Divisional Analysis by TJ Business Analysis Ltd: Transcol has performed well in the past, with FlyCol, in particular, posting spectacular growth. This growth has slowed in Western Europe in the face of the twin pressures of new budget airline entrants to the market coupled with the major airlines finally beginning to compete at budget prices. Although TransCol has hopes that market and service extension in Eastern Europe will maintain such growth, this would seem unlikely. AutoCol and CoachCol are beginning to perform better in the light of the rising cost of private car ownership and the development and positioning of their up-market coaching brand: ‘Elite’ which seems to be dispelling the old reality of coach trips and holidays being of poor quality and low price. Sub-Divn. FlyCol AutoCol CoachCol Turnover Y0 270m Euros 30m 20m Operating Profit Y0 27m Euros 5m 4m Turnover Y1 330m Euros 45m 30m Operating Profit Y1 24m Euros 10m 15m Assets Y1 2000m Euro 25m 25m 2.1 AccommoCol Division. (incorporating the following brands / profit centres) • • • • HoteloCol: A range of 120 hotels with sub-brands at 5* to 3* level situated in most western European Cities and towns, particularly, France, UK and Germany. (Think Accor) AppartoCol: 50 x Suite-style accommodation units, usually co-located with appropriate HoteloCo sites. ResortoCol: 15 x All-Inclusive Leisure Resorts, located principally in the Caribbean, and Far East.(Think Sandals) RoadoCol: 200 x Budget Hotels throughout Western Europe and rapidly developing in the new accession countries of the EU. Most have been developed courtesy of an alliance with petrol companies like Shell, BP, Total and Agip where land has been made available at motorway and major road service stations. (Think Campanile, F1) [PS… why DOES the Agip animal logo have one more leg than it strictly needs?] Critical Divisional Analysis by TJ Business Analysis Ltd: The HoteloCol operations have been having a tough time of late and it seems likely to continue when set against the continued success of the budget hotel, the constraints upon corporate Business Travel expenditure accounts and the increasing use of video-conferencing, internet, email and other means of communication. AppartoCol and ResortoCol seem to have just about held their own in competitive markets (but their continued performance should be closely monitored), whereas RoadoCol would appear to be the only success story. In the light of the above, if the performance of certain sub-divisions does not improve, the Division should perhaps consider the re-distribution of its assets and holdings. Sub-Divn. HotleloCol AppartoCol ResortoCol RoadoCol Turnover Y0 400m Euro 63m 250m 180m Operating Profit Y0 80m Euros 20m 60m 54m Turnover Y1 300m Euros 63m 250m 200m Operating Profit Y1 30m 25m 60m 60m Assets Y1 2400m 750m 2000m 500m
  2. 2. 2.2 CaterCol Involves: La Bouffe: is the umbrella brand for all CaterCol’s operations which comprise: Auto-Bouffe. A chain of 180 roadside restaurants on most auto-routes and highways in France, Germany, Italy and Spain: often co-located with Roado-Col accommodation units. A La Bouffe: A franchise operation of 62 establishments at the upper end of the market throughout France. Techno-Bouffe: A new and fast-growing wholly-owned chain aimed at the 12-20 age range, combining the very best in online gaming and communications technologies with low-priced fast-food and drink. 90 sites in France and the UK usually located close to secondary schools and colleges. Bio-Bouffe: Launched last year, (currently with only 5 wholly-owned units, but hoping for rapid franchise-based expansion) this chain hopes to capture the ‘first-mover advantage’ by colonising very early the fast growing market for fast, healthy, seasonal organic food which is locally sourced from small producers. The brand embodies common, omni-present values but non-identical menus as they are based upon local produce, ‘terroir’ cooking styles etc. Critical Divisional Analysis by TJ Business Analysis Ltd: An interesting ‘family’ with both ‘general and ‘niche’ markets, traditional and avant-garde. Auto-B and A La B are reliable and predictable performers in today’s markets whereas the company has ‘taken a flyer’ with Techno-B and Bio-B in attempting to break new ground in catering by appealing to highly specific markets. Bio-B is clearly high-risk in that to take the first-mover leadership advantage ‘early’ can sometimes prove to be ‘too early’, nevertheless, first turnover postings appear encouraging. If it works, the ‘trick’ will be to rapidly expand the operation to avoid the competition carving a share. Sub-Divn. Auto-B A La B Techno B Bio-B Turnover Y0 50m Euro 80m 50m 5m Operating Profit Y0 20m Euros 20m 10m 2m Turnover Y1 60m Euros 120m 60m 10m Operating Profit Y1 20m 25m 15m 4m Assets Y1 200m 100m 40m 5m 2.3 SustainoPack (Future SustainoCol?). Involving: SustainoPack. A ‘ground-floor’ investment in a revolutionary new form of packaging for almost all consumer products. This was based upon a business idea coming out a University of Haute Alsace ‘Incubator’ company which combined the vision and technical expertise of four individuals from a number of critical fields in which the university is engaged. ColmarCo owns 30% of the equity in the company [the remaining shares being held by the four key players cited above and UHA 10%]. The initial investment by ColmarCo was just 1M Euros to register the patent and set up the company: a high-risk / highreturn investment. The Unique Selling Proposition of the company is that it offers a 100% bio-degradable and sustainable solution for almost ANY packaging requirement. Independent research has shown that as the packaging agent is based upon the use of a natural starch and can be ‘cultured’ / grown naturally at minimal cost, it will be possible to match and possibly undercut the price of any plastic competitor products. Offering a product (at no greater cost than the presently unsustainable alternative) which is guaranteed to decompose into the earth without any pollution effect whatever within in six months and at a price to undercut existing supply appears to be a world-beating opportunity and ColmarCo is particularly anxious to grow this business urgently by making major investments while the patent offers a potentially sustainable business advantage. In its first year of trading (Y-5), the company produced a turnover of 250,000 Euros and broke even. Forecasts for future years suggest a meteoric growth is possible, although it is a little too early to be assuming such figures will occur. Subject to appropriate capital investment, and assuming it has proven possible to break into the supermarket packaging market, projections suggest: Year Y-5 Y-3 Y0 Y3 Y7 • • Turnover Act/Proj (€) 20m 80m 250m 500m 750m Profit Act/Proj(€) 4m 20m 75m 125m 125m Asset Value 4m 8m 16m 24m 32m ColmarCo is considering purchasing the remaining equity in the company with a view to: using the ‘Sustaino’ name as a brand overlay for other elements in its existing product range diversification into non-leisure production / services in the light of the increasing role of Sustainability in all our lives.