1
Table of Contents
Business Plan Executive Summary
Objectives Mission Statement
Keys to Success Company Summary Internal Environment Management Summary
Facilities Budget Overview External Environment Market Analysis Summary Market / Client Research Competitors
Evidence of Customer Demand Economic Environment Social / Cultural Environment Natural Environment Legal / Regulatory Environment Financial Planning and Forecasts SWOT Analysis Issues Analysis
Marketing Plan Target Market Objectives Unique Selling Point Marketing Strategy Pricing Strategy Distribution Strategy Integrated Marketing Communications (IMC) Advertising Sales Promotion Personal Selling Sponsorship Strategies Implementation of Marketing Strategy September October November Post Internship Marketing Controls
1
Executive Summary Jungle Adventures by Kalu Yala was founded by five Kalu Yala business interns in the fall of 2012. The company facilitates three-‐day jungle excursions for backpackers into the Panamanian highlands. This escape gives travelers the opportunity to immerse themselves into an off-‐the-‐grid lifestyle, where they can test their limits by participating in experiential outdoor activities and sustainable practices in an authentic setting. Presently, the tourism product is in the introductory stage. It was formed under the Kalu Yala company’s umbrella and given a budget of $1000 for startup costs. Being able to use Kalu Yala’s resources provide Jungle Adventures with a great strength, enabling it to function and get started with such a minimal budget. The backpacker community is the company’s primary target market; being based in Panama City allows us to capture those travelers at the beginning of their journey who are spending a few days in the city before moving on. The company competes primarily on being one of the few jungle excursions within such close proximity to Panama City, the budget pricing of the tourism product, and the company’s ability to satisfy the wants and needs of the backpacker market. Future plans include expanding into different markets, including, mid-‐range and high-‐end luxury tours that are targeted to those looking for a more convenient experience. We would hope to see this expansion within the next 3-‐5 years. As Kalu Yala builds and the community continues to develop, Jungle Adventures will also be able to expand and move into these greater markets. Jungle Adventures by Kalu Yala competes directly with a range of different competitors from lodging establishments to tour operators and outright destinations. Many of these competitors offer ecotourism experiences, but at prices outside the range that the backpacker market traditionally spends. With the access to a large valley, over time, this will become a thriving community where there will be an abundance of adventure activities, which will set us apart from our competitors. Jungle Adventures is in a unique position to offer a jungle experience complete with exciting activities, an authentic social scene and lodging at a rate acceptable to the backpacker market. Strong management and a solid team with industry experience will ensure sustainable growth and a quality tourism product. With this experience and some financing and investments, it will help advance the company in the direction of entering new markets and becoming a premier facilitator of immersive outdoor experiences in Panama.
1
Business Plan Objectives Short Term: To effectively market and produce two successful three-‐day trial excursions into the Valley of the Los Tres Brazos, each with six to eight backpackers, by December, 2012. Medium Term: To organize and execute three to four excursions monthly. To establish a strong business presence in Panama City by creating great working relationships with hostels, restaurants, and other tourism-‐related entities; while fostering positive community relationships in San Miguel, which Kalu Yala has worked hard to achieve and maintain. This will take place over the course of the next year, ending January 2014. Long Term: To continuously improve and expand Jungle Adventures by Kalu Yala within the constantly evolving entity of Kalu Yala. The ultimate goal for this product is to facilitate the use of other small Kalu Yala businesses in order to provide a greater number of activities available to our customers, while frequently completing successful backpacking excursions into the Los Tres Brazos Valley. This will also include creating and maintaining relationships within Panama City, San Miguel and the future community of Kalu Yala. Vision To be the premier facilitator of immersive outdoor experiences in Panama. Providing short getaways for our tourists coming from far and wide, tailored to those traveling on a budget as well as those seeking a more luxurious escape. Our excursions are designed to offer a wide range of outdoor experiences, whether one is looking for a more relaxing nature experience or a high-‐energy adventure package. Come enjoy the rivers, mountains and beauty of the tropics, whilst among the enticing culture and community of Kalu Yala. Mission Jungle Adventures by Kalu Yala gives travelers the opportunity to immerse themselves into an off-‐the-‐grid lifestyle, where they can test their limits by participating in experiential outdoor activities and sustainable practices in the raw Panamanian highlands.
Keys to Success
● Effectively Target Market ● Employ Top Notch Customer Service ● Provide Reliable Transportation ● Offer Quality Activities and Products ● Maintain and Expand Sustainable Practices ● Increase Focus on Cultural Activities ● Adapt to Market Changes and Kalu Yala’s Evolution ● Develop and Evaluate Feedback Loops ● Deliver an Enjoyable Jungle Excursion
1
Company Summary Jungle Adventures by Kalu Yala is a sustainable tourism company seeking to provide the best jungle adventure that Panama has to offer for backpackers, outdoor enthusiasts and inspiration-‐seeking individuals. We are focused on sustainable practices, quality services, stimulating adventures and authentic experience with unforgettable memories.
Internal Environment Service Jungle Adventures by Kalu Yala maintains a high quality of service throughout the entire tour process. Employees will be recruited throughout the hospitality and tourism industry; bringing professionalism and industry knowledge to our team. We provide travelers with an enjoyable three-‐day jungle excursion. It begins with reliable transportation from Panama City to the San Miguel trailhead followed by a challenging hike into Kalu Yala’s jungle base camp accompanied by our knowledgeable staff. Once there, we offer guests an assortment of outdoor adventures and activities carefully planned and administered by Kalu Yala Directors and our staff. In order to align with the overall goals of Kalu Yala, our staff will keep sustainability in mind throughout our business and marketing practices to reduce our environmental footprint. Management Summary Jungle Adventures by Kalu Yala is currently operated by Kalu Yala Internships. This company has been created and launched by the five interns mentioned below; presently, they are responsible for the logistics and operations of the tour company.
Lynette Andrews: After completing her undergraduate degree at the College of Charleston, Lynette spent 4 years working in a sales role for the tour operating company, EF Education. She is currently pursuing her Masters in Tourism Administration from the George Washington University. Lynette’s past experience and current academic endeavors have helped prepare her for this venture. Nathan Hingtgen: After receiving his undergraduate degree from the University of North Carolina at Wilmington, Nathan has gone on to pursue his Masters in Sustainable Tourism from East Carolina University. Panama is the perfect place for Nathan as he is able to perfect his Spanish while pursuing his passion for tourism. Alix Tingle: Alix was raised in Montana and graduated from the University of Montana with degrees in International Business and Marketing. Wanting to pursue a career in business, she is determined to let her passions be her guide so that she may have the most rewarding job possible. She loves to travel and has always had the desire to spend some time in Panama, so when the opportunity
1
presented itself, she made her way down here. Alix is thrilled to intern at Kalu Yala with such inspiring people and be a part of something creative, exciting, and sustainable.
Lara Willis: Hailing from England, Lara received her Bachelors of Science Degree from the University of the West of England where she majored in Business in Property. Lara has always loved to travel and prior to commencing her undergraduate degree she spent time backpacking around Australasia. Since then, she has caught the travel bug and could not wait for a new adventure to start. Lara’s love of travel brought her to Panama where she was excited to help bring more backpackers to Panama and into the Kalu Yala Valley through this company.
Haley Winslow: Haley received her Bachelors of Science Degree in Hospitality Management with a Concentration in Conventions and Special Events from East Carolina University. Here, she also received her Minor in Business Administration. After graduation, Haley decided to pursue her education further, and is currently working on her Masters of Science in Sustainable Tourism at East Carolina University. Haley has worked throughout the hospitality and tourism industry since the age of fifteen, including an assortment of restaurants, a country club, and Walt Disney World. Haley’s desire to travel and interest in the tourism arena has led Haley to Panama where she is currently working as a Business Intern for Kalu Yala. The combination of the Jungle Adventures staff’s educational backgrounds, career ambitions and passion for tourism has made them the ideal management team for this undertaking. After the development and launch of this company in late October, the select group of individuals will be relieved from their roles and will pass the company on to a pre-‐selected tourism professional within the Kalu Yala family. It is our aim to have a full-‐time staff member who will be in charge of all daily activities as well as management of the intern team. The manager and intern team would be responsible for the organization and execution of the tours. This includes all marketing efforts comprising of updating social media outlets and the website, outreach and recruitment from hostels within Panama City, as well as other tourist hotspots in Panama; continuous relationship building with local business owners within our market, and maintaining any other forms of marketing outlets. Daily duties consist of answering phones, responding to emails, booking tours, managing finances, and ensuring that welcome packets and transportation information is sent to registered guests. The company manager would ideally have a passion for travel and tourism and professional background in project management and sales.
Facilities Since Jungle Adventures is the first business launched under the Kalu Yala umbrella, the parent company (Kalu Yala) supports Jungle Adventures by allowing the use of their facilities. As companies succeed under the Kalu Yala umbrella, the value of Kalu Yala’s land and the likelihood of additional business start-‐ups will increase. Kalu Yala’s goal is to establish a strong entrepreneurial climate and culture, thus the lending of their facilities to Jungle Adventures reflects this mindset.
1
As of October 2012, these facilities include office space within Casa Yala (Panama City) to conduct all daily operations, use of Casa Llena in San Miguel as a storage and meeting point for our tours, in addition, we have full access of the base camp and land in the Kalu Yala valley. As this company grows and becomes more independent, the goal will be to acquire our own facilities. This includes, but is not limited to: a rancho in the valley, a van, and office space. Budget Overview Since Jungle Adventures by Kalu Yala began under the Kalu Yala umbrella, we have been able to develop our business on a very minimalist approach. The resources provided to us by Kalu Yala have enabled us to keep costs very low. Jungle Adventures has been created up to this point using the $1,000 allotted budget that Kalu Yala Internships has dedicated to the business program for the Fall 2012 semester. In order to expand this business venture, investment from outside Kalu Yala Internships will be required. With additional capital, Jungle Adventures will not only be able to capture a larger share of the backpacker market but will also have the opportunity to expand into other markets such as mid-‐range and higher-‐end tourism markets. For a more detailed look into Jungle Adventures’ budget and forecasting projections please see shared Google Document entitled Jungle Adventures Forecasting Fall 2012.
External Environment
Market Analysis Summary Market / Client Research Jungle Adventures by Kalu Yala’s current target market is backpackers. The following content has been provided to explain our reasoning for why we chose this niche market. According to the Backpacker Operators Association of New South Wales, backpackers spend more, travel further and stay longer than any other travelers. The typical backpacker is young (18-‐35), educated, adventurous and price conscious. According to the book Backpacker Tourism Concepts and Profiles, backpackers can be characterized by five distinct indicators. These include:
1. A preference for budget accommodations 2. An emphasis on meeting other travelers 3. An independently organized and flexible travel schedule 4. Longer rather than very brief holidays 5. An emphasis on informal and participatory holiday activities (Pearce, 1990)
A Preference for Budget Accommodation: Backpackers use a variety of lodging options throughout their travels. Backpacker accommodations can be classified as properties that offer a low cost range of sleeping arrangements. These could include dormitories, private rooms, a communal room or set of rooms (family rooms), and a self-‐catering facility. They enjoy having a space that facilitates
1
guest interactions such as communal living rooms and kitchens. The majority of backpackers prefer to spend as little as possible for their accommodations, while also feeling a sense of value for their money. Therefore, sometimes backpackers choose accommodations that are not always the cheapest option. Backpackers spend most of their traveling funds on activities instead of food and lodging.
Budget travelers will generally seek accommodations in the center of a city or town that are in close proximity to a destination’s sites and attractions. Although these travelers may prefer the busy city centers, they are also attracted to accommodations that are in remote and picturesque locations that offer an alternative tourist experience. The hardest part about getting backpackers to these remote locations is having adequate transportation. Unless private transportation is provided to these locations, public transport needs to be available. Price Sensitive Market: In 2007, data from Tourism Australia showed that the average expenditure of the backpacking market was more than double that of non-‐backpackers. Average expenditure per backpacker was $5400 AUS compared to $2300 AUS per non-‐backpackers. Although backpacker’s budgets are typically less per day (between $30 -‐ $50), they typically stay in the country for a greater amount of time than other international visitors. Backpacker visits average 71 nights compared to 25 nights for non-‐backpackers (Tourism Research Australia, 2008). Tourism Australia identified this market by defining a backpacker as anyone staying in a backpacker accommodation (hostel) for one or more nights. Crave Interactions with Fellow Travelers and Locals: Socialization is a primary motive for backpackers. They are always ready and eager to socialize with both travelers and locals. Meeting other travelers is typically a great way to exchange information regarding traveling tips. Most backpackers trust one another’s opinions about the activities and places that are worth visiting. They crave authentic travel experiences and seek out experiences that facilitate the interaction with locals.
Flexible Itinerary: Most backpackers arrive at their destination with flexible itineraries and few reservations. Although backpackers may have an idea about where they want to go while visiting a country, they tend to change their schedules to include other destinations that sound fun, interesting or are recommended by other backpackers.
Adventure Hunters: Backpackers pay special attention to adventure tours and attractions that require active participation. This market seeks authentic adventures that include the local culture, population, and environment, therefore, they seek activities that are not included in the traditional mass tourism circuit.
Working Backpackers: A large portion of backpackers are willing to work casually during their trip. They do this to either supplement their funds or to extend their trip.
1
Backpackers Benefit to the Panamanian Economy Backpacker expenditures generate substantial employment for Panama. Although backpackers may have limited funds, they typically will spend every dollar saved while traveling abroad, which is why some choose to work while traveling abroad. They benefit the economy because their visit creates and supports jobs throughout the hospitality and tourism industry as well as other businesses along the supply chain such as food and beverage, and transportation. As well as influencing a multitude of businesses, backpackers also spread jobs and revenues throughout different regions of Panama. This is possible because backpackers are in the country for an extended period of time traveling to different regions of the country thus spreading their funds more widely than other international tourists. According to the book Backpacker Tourism Concepts and Profiles, backpacker tourism has been characterized as “good” tourism, in comparison to mass-‐market packaged tourism, often characterized as “bad” tourism(Kevin Hannam, Irena Ateljevic, 2008). This is among the reasons as to why we as a sustainable tour company have chosen this market segment.
Table 1: How Backpackers Can Facilitate Local Development
Economic Development Criteria Non-‐Economic Development Criteria
· Spend more money than other tourists because of longer duration of visit
· Enterprises catering for backpackers are generally small and thus ownership and control can be retained locally
· Adventuresome nature and longer duration of visit means money spent is spread over a wider geographical area, including remote, economically depressed, or isolated regions
· Local people gain self-‐fulfillment through running their own tourism enterprises rather than filling smaller positions in enterprises run by outside operators
· Do not demand luxury and therefore will spend more on locally produced goods (such as food) and services (transport, homestay accommodation)
· Because they operate their own businesses, local people can form organizations which promote local tourism, giving the community power in upholding their interests and negotiating with outside bodies
· Economic benefits can be spread widely within communities as even individuals with little capital or training can provide desired services or products. Formal qualifications are not needed to run small enterprises; skills can be learned on the job
· The interest of backpackers in meeting and learning from local people can lead to a revitalization of traditional culture, respect for the knowledge of elders, and pride in traditional aspects of one's culture
1
· Only basic infrastructure is required therefore ensuring low overhead costs and minimizing the need for imported goods (such as can use bamboo and thatch to create a beach stall)
· Backpackers use fewer resources (like cold showers and fans rather than hot baths and air conditioning), therefore are kinder to the environment
· Significant multiplier effects from drawing on local skills and resources
· Local servicing of the tourism market challenges foreign domination of tourism enterprises
* (Regina Scheyvens, 2002) Annals of Tourism Research Volume 29, Issue 1, January 2002, Pages 144-‐164 : Backpacker Tourism and Third World Development The information above has been provided to show that Jungle Adventures by Kalu Yala has considered the country of Panama in our guiding decision to target the backpacker market. Without the support and considerations of the country, we would not and could not consider ourselves a sustainable company. Market Analysis Keeping in mind pricing considerations, the need for social interactions, and tour flexibility, it is clear that the niche market of backpackers is the ideal target market for Jungle Adventures by Kalu Yala. Our trip fulfills all of the preceding criteria while giving backpackers the opportunity to experience the Panamanian jungle highlands in a unique and exciting way. Jungle Adventures currently charges $25-‐$30 per person a day for transportation, lodging and food. This pricing structure falls within the approximate daily budget for backpackers. Jungle Adventures’ tour is also ideal for the backpacker market because it creates a way for these backpackers to meet other travelers, Kalu Yala director and interns. Interns living in the Kalu Yala valley are from various countries and help to contribute to the culture of the Kalu Yala base camp. We provide a scene for backpackers who are eager to socialize and interact with other travelers and locals in an authentic setting. Flexibility is key to catering to the backpacker market. Currently our tours are run on a sporadic basis, but it is our aim for the near future is to increase the numbers of tours run to at least once a week. These tours are also set up to give our guests the option of choosing between a list of predetermined activities so that all guest’s itineraries are catered toward their particular interests. Backpackers are also appropriate for our adventure company’s tour due to a desire for out-‐of-‐the-‐box, small-‐scale tourism experiences. Our tour gives backpackers the opportunity to stay in the Panamanian highlands the way the local campesinos do, creating the sensation of an authentic day in the life of a local. Site Visits
1
As a part of the market analysis, the Kalu Yala Jungle Adventures staff visited six hostels within Panama City. After doing online research on all hostels in the Panama City area, these hostels were chosen due to location, pricing, and popularity. During the site visits, the visiting Kalu Yala staff determined cleanliness, customer service of hostel staff, occupancy and analyzed the potential marketing opportunities within the hostels. It was determined that the 6 hostels: Luna’s Castle, Panamericana, Hospedaje Casco Viejo, Hostel Urraca, Mamallena Backpackers and Hostal Villa Vento Surf would be the six hostels to which Kalu Yala Jungle Adventures would begin their marketing efforts. Please refer to shared Google Document entitled Jungle Adventures Hostel Research Fall 2012 for a comprehensive report of the information gathered during the site visits. Competition A search through the most recent Lonely Planet guide in addition to several Google searches provided a significant list of competing products. This section will detail lodging-‐based competitors, competing tour operators, and competing destinations. By no means is this an exhaustive list but it does provide a sample and a good representation of the products that Jungle Adventures is competing against. The competition discussed here has a focus on ecotourism and are located in many different geographic areas of Panama. Lodging-‐Based Establishments The establishments discussed here (see Google Spreadsheet: Jungle Adventures Competition Fall 2012, “Lodging” tab) include Bed & Breakfasts, hostels, various ecotourism-‐based lodges and small inns. Five principal direct competitors have been identified due to their proximity to Panama City and the offering of tourism products similar to Jungle Adventures’. Figure 1 below illustrates our direct competitors, which are Hostal Casa de Campo, Panama Outdoor Adventures, La Estancia B&B, Monkey Lodge and Sierra Llorona. Each competitor is located within an hour and a half from Panama City and provides nature-‐based activities and excursions. All information about these properties has been gathered from their respective websites. Figure 1: Direct Competitor Map
1
La Estancia La Estancia, located within Panama City, is unique in that it offers an ecotourism experience very close to the city and can be reached easily by public transportation. It also has a tour operator company that offers rainforest excursions, indigenous village visits, and bird watching expeditions outside of town. The cost of lodging here is relatively high, with the cheapest rooms going for $85, but many amenities are provided. The strength of La Estancia is it’s rainforest feel with incredibly easy access to the shopping and nightlife of Panama City. Panama Outdoor Adventures Panama Outdoor Adventures emphasizes their activities through their marketing materials and offers cheap lodging in the form of camping and even has tents available for rent. The price for camping could not be obtained after repeated emails, but the focus here is on the activities such as zip lining, river tubing, hiking, and horseback riding. Trip Advisor reviews are overwhelmingly positive but few discuss the camping aspect. This seems to be a day trip destination and would definitely be a direct competitor if Jungle Adventures were ever to offer one day excursions.. Sierra Llorona Sierra Llorona is off the main roads and emphasizes bird watching, scientific research, swimming, and hiking. The lodge has seven rooms, the cheapest of which costs $55 per night with suites offered for up to $85 per night. Activities available in the area include trips to Colon, indigenous villages, the Canal, and the Caribbean beaches. This place offers a slower paced experience where guests can choose to partake in activities or simply relax around the property, as is the idea for Jungle Adventures trips. Casa del Campo Casa del Campo is the closest competitor geographically to Kalu Yala and provides direct access to the Chagres National Park. The place is more upscale and offers honeymoon packages, ecotourism packages, a day spa, and can host large meetings or events. Four cabins and seven basic rooms are available with prices ranging from $70-‐$95 per night.
1
Monkey Lodge Monkey Lodge clearly emphasizes their ability to place guests in close contact with monkeys and other animals. Their strategic location between Panama City and Colon, close to Soberania National Park is a significant advantage. The place is small and only offers four cottages for rent ($80/ night), but also operates tours to the rainforest, Portobello, San Blas and other places in the vicinity. Of these five prime competitors, the only conveniently reachable by public transportation is La Estancia, located within the city. All other properties suggest driving in private transport to arrive. Panama Outdoor Adventures seems to receive a lot of traffic, but heavily relies upon day trips to experience their activities. The cost of a night’s stay in these places is relatively high, with the cheapest option being $55 for a night at Sierra Llorona. Despite the geographic proximity of these places to Kalu Yala, no other company is currently offering the rustic type of stay that Jungle Adventures can offer. These properties are not targeting the backpacker market as is reflected by their relatively high prices. A trip to the Kalu Yala Valley can offer similar activities to those offered by these competitors at a rate much lower but with lesser amenities. All of these properties offer ecotourism experiences, but Jungle Adventures is in a unique position to offer a lower budget trip to the backpacker market, especially those more interested in “natural” activities such as hiking and swimming as opposed to man-‐made activities such as zip lining or tubing. These activities will be looked into as possible add-‐ons to a Jungle Adventures trip in the future. Providing efficient, safe transportation will be key for the success of Jungle Adventures. The properties described above, like Kalu Yala’s valley, are not on main public transportation routes (with the exception of La Estancia), so this does not represent a “competitive disadvantage” for Jungle Adventures. We can stand out against this competitive set by offering a low cost ecotourism experience that is easily accessible due to the provision of reliable transportation for guests. Direct Competitors: Tour Operators Further details on these properties can be found in shared Google spreadsheet: Jungle Adventures Competition Fall 2012, “Tour Operators” tab. There are many ecotourism experiences available throughout the country, especially around Bocas del Toro, Boquete, and El Valle de Anton. The following is a brief summary of the products offered by tour operators in Jungle Adventures’ competitive set. All information has been gathered from each company’s individual website. Panoramic Panama Operated in conjunction with the aforementioned La Estancia Bed & Breakfast, Panoramic Panama offers a wide range of day trips with various overnight options. Day trips involve visits to the Gamboa Rainforest, the Embera indigenous village, El Valle de Anton, and bird watching. All trips have a guide and transportation included and the price drops significantly per person when registering as a group. The most affordable day trips go to the Gamboa Rainforest and the indigenous village of Embera, with prices ranging from $75 per person (with a group) up to $220
1
when registering as a single guest. Based upon this information, it can be expected that Panoramic Panama target travelers in small groups. The price for their excursions is probably too high to attract a large share of the backpacker market. Gatun Explorer With it’s lakefront/canal front base of operations, Gatun Explorer offers a range of tours throughout Lago Gatun, the canal itself, and the surrounding rainforest. Their most popular tour is a one-‐day excursion combining the canal experience with the natural beauty of the rainforest and is priced at $98. The company also offers fishing, kayaking, and overnight tours. Overnight tours beginning in the afternoon cost $140 and the price jumps to $200 to begin in the morning. The pricing of these tours lies outside the $30-‐$50 a day price range that most backpackers are likely to spend. EcoCircuitos EcoCircuitos offers over 80 tours throughout Panama. The trips most closely competitive to Jungle Adventures’ consist of journeys to the rainforests of Cope National Park (2 days/ 1 night) and the MesoAmerican Biological Corridor (3 days/ 2 nights). Each trip includes transportation from Panama City, guides, lodging, and meals. A quote obtained for the MesoAmerican Biological Corridor stated the price at $575 while no quote could be obtained for the Cope National Park trip. EcoCircuitos could possibly be pricing backpackers out of their tour offerings. Adventure Tours Panama Adventure Tours Panama can customize just about anything a visitor wants to do into a tour. The hiking tours on their website include day trips to Cerro Campana National Park, Soberania National Park, and the Rio Chagres National Park starting at $100/day. Mountain biking tours, fishing tours, rafting tours, and indigenous village tours are also offered at around $100/day. Tours can be customized to include overnights but most of their advertised tours are of the day trip variety. Monkey Lodge Tours The company operates out of Chilibri, about 30 minutes north of Panama City and consists of a lodge with extensive touring options. The lodge only has four cottages and can house a maximum of 10 people at a time. However, the excursions offered seem to be very competitively priced. A 2 day/1 night jungle trek to the outskirts of Portobello costs $160-‐$190 and includes a guide, meals, camping equipment, and survival techniques education. Hiking in the Camino de Cruces National Park runs $50-‐$75 and includes guides, drinks, snacks, and transportation back to the Monkey Lodge. There are many tours specializing in bird watching, jungle hiking, adventure sports, and indigenous village visits. However, the pricing of most, if not all, of these tours eliminates backpackers from the target markets of the above tour operators because their rates are too high. The difficulties of reserving and confirming a trip are noteworthy as this requires several steps and significant back and forth communication.
1
At this point, Jungle Adventures by Kalu Yala is not in a position to offer day trips, but the 3-‐day/2-‐night trip in which we are to specialize offers an affordable multi-‐day excursion with many of the features of the above tours at more backpacker-‐friendly prices. Additionally, our tour has more to offer socially whereas the above trips are more specialized to specific nature-‐based tourism niches. Our proposed specialization, a 3 day/2 night jungle excursion, combined with the social experience from interacting with Kalu Yala directors and interns, is more suited to the backpacker market than many, if not all, of the tours currently available in the immediate vicinity of Panama City. Destinations The destinations of Anton del Valle, Boquete, Bocas del Toro, Santa Catalina, San Blas, and Pedasi are backpacker hotspots due the availability of affordable accommodations and activities in their immediate vicinities (See Google spreadsheet: Jungle Adventures Competition Fall 2012, “Backpacker Destinations” tab). Anton del Valle and Boquete are mountain towns while Bocas del Toro, Santa Catalina, San Blas, and Pedasi are beach towns. Anton del Valle Its location, only 1.5 hours from Panama City makes this an easy weekend trip for backpackers and city-‐dwellers alike. The town, located within a volcanic crater, offers access to National Parks, waterfalls, hot springs, and wildlife viewing. There is also a zoo, a large market, canopy tours, hiking, bird watching, and horseback riding available. There are several hostels available for $10-‐$15/ night (hostelbookers.com), making it an affordable destination for backpackers. Boquete Boquete is currently the most tourist-‐centric of Panama’s mountain towns. Within the last decade a boom in real estate resulted from many retirees buying property in and throughout the surrounding area of Boquete. The town is located to the east of Volcan Baru, 9 hours from Panama City and offers hiking, horseback riding, wildlife viewing, access to two National Parks, canopy tours, rafting, hot springs, coffee farm tours, and an assortment of other mountain based activities. There are many hostels here, ranging from $8-‐$20/night (hostelbookers.com) and this affordable lodging combined with nearby activities makes it a backpacker hotspot. Bocas del Toro The archipelago, located around 9 hours from Panama City, comprises one of Panama’s main tourist attractions. Its natural beauty combined with a party atmosphere makes it an attractive destination. Activities available for tourists include surfing, snorkeling, boat tours, fishing, hiking, kayaking, biking, and simply lounging on world-‐famous beaches. A wide array of lodging is available including many hostels charging $10-‐$25/night (hostelbookers.com). Santa Catalina The famed surf town, about 7 hours from Panama City, attracts a wide range of backpackers, not just surfers. With access to beaches, diving, snorkeling, fishing, and Coiba National Park combined with an array of cheap hostels ($8-‐$20/ night, hostelbookers.com), many backpackers make it a
1
point to stop here; although the destination is a bit out of the way and not on any of the main transportation routes. The jungle experience is not a selling point of Santa Catalina. San Blas Islands Another beautiful archipelago, San Blas still has the indigenous Kuna people living here and makes for a very interesting trip. Many people stop here while sailing to Colombia to relax on the beach, interact with the Kunas, and to experience a bit of paradise. Access is difficult and trips must be planned in advance, although there is a wide range of lodging options once the islands are reached. Lodging can expensive ($30-‐$130, tripadvisor.com), but many backpackers still find a way to make San Blas fit into their trip. Pedasi Another surf/beach town that attracts backpackers is Pedasi. Located six hours from Panama City, the town attracts surfers and beachgoers, and serves as the hub for exploring the Azuero Peninsula. With Playa Venao down the road, as well as many other quality surfing waves, Pedasi sees lots of traffic and has many restaurants and an array of lodging options. The cheapest hostels start at $15/night (personal experience) and travelers have access to beaches, fishing, diving, snorkeling, hiking, and horseback riding. These destinations compete with Jungle Adventures as they can each offer several days of enjoyment for backpackers. With affordable lodging and an array of activities, backpackers are likely to stay for several days at least and not merely visit for day trips. Apart from Anton del Valle, these destinations are not easy to get to from Panama City and require bus transfers and long rides. Establishing partnerships with hostels in these areas may be beneficial to Jungle Adventures as a significant portion of backpackers that end up in Panama City have likely passed through at least one of these destinations. Competitive Analysis Summary Jungle Adventures by Kalu Yala faces an assortment of competitors ranging from lodging establishments to tour operators and outright destinations. Many of these competitors offer ecotourism experiences, but at prices outside the range that the backpacker market traditionally spends. Jungle Adventures is in a unique position to offer a jungle experience complete with exciting activities and lodging at a rate acceptable to the backpacker market. These competitive destinations offer cheap lodging and an atmosphere full of young travelers, leading to an enjoyable trip even if the backpacker does not choose to participate in day tours or activities. This type of atmosphere should be created by Jungle Adventures to offer a competitive experience.
1
Evidence of Customer Demand From the hostel research conducted by members of Jungle Adventures by Kalu Yala, it is apparent that we have a niche market and a good product that many are excited to see. Some hostels even went as far to say that they will promote us on their website, while others said they would give us a space that stands out on the activity board so people are more likely to book with us. Jungle Adventures base camp is located in close proximity to Panama City. As evidence from the previous competitive analysis, the majority of other tours and attractions are situated hours from Panama City. Presently there are no real competitors and those that we will be competing with are renowned for being unreliable with the hostels. Hostel managers expressed that there is a need for a product that is consistently run, reasonably priced and located relatively close to the city. Economic Environment Panama is positioned to experience great economic growth. According to the CIA World Factbook, Panama’s Gross Domestic Product was estimated to be 51.26 billion in 2011, which was a considerable gain of 10.6% over 2010 (a growth rank 6 in the world). In 2012, sources say “Panama has the highest economic growth rate in the hemisphere (Beaubien, 2012).” While this growth is great for the economy overall, much of the development is not reaching the poorest residents. While some of the country gets rich, over 1/3 of residents are not seeing these benefits (Beaubien, 2012). If tourism is developed in the correct manner, it should help to alleviate this income disparity issue. A main contributing factor to Panama’s growth is construction. With the construction boom underway in Panama, it is expected that the $1 billion worth of investments in the 28 new hotels to be finished by 2013, at the latest. This means that a large number of new facilities will be/are available to tourists and residents alike. Other than the investment in tourism infrastructure, there is high demand for retirement homes, banking centers, and other corporate investments (Business Panama, 2012). With the addition of government spending in public works, specifically, the subway system in Panama City, retirees and visitors alike will enjoy easier access to attractions both inside and outside of the city. With an estimated population of 3.5 million in an area that is roughly the size of South Carolina, tourism supports approximately 86,000 jobs, which is 5.7% of the economy (Visit Panama, 2012). Panama was ranked as the top place to visit in 2012 by The New York Times and also received other accolades in well-‐read travel-‐related publications; Panama has experienced impressive growth in terms of arrival numbers (up almost 20% over 2011) and tourist receipts (up 15% over 2011) in the first few months of 2012 (Visit Panama, 2012). According to statistical data about Central America, Panama has the largest impact on the country’s economy due to the country having the highest expenditures per tourists of any other Central American nation (Visit Panama, 2012). In 2011, Panama’s Tourism Authority launched an international marketing campaign, hosted tourism fairs, and cooperated with Copa Airlines to allow transit passengers to change their airline tickets without charge to enable them to stay longer in Panama.
1
As can be viewed in chart 1 below, when the recession hit in 2009 and visitor numbers fell worldwide, Panama was still able to experience growth in terms of international tourist receipts. This signifies that although there were less international tourist arrivals worldwide, the average expenditure per visitor was higher thus creating a higher economic impact per visitor. Chart 1: International tourism receipts and arrivals
In addition to the standard industries that traditionally support the economy, significant changes in terms of economic landscape are projected to have a great impact on the economy. Panama is a service-‐oriented economy, which contributes to approximately 80% of its GDP. According to the CIA World Factbook, the service sector is made up of the Panama Canal, banking, the Colon Free Zone, insurance, container ports, flagship registry and tourism. With the expansion of the Panama Canal, scheduled to be finished in 2014, larger ships will be able to pass through the canal. This will significantly increase the economic impact of the canal because the larger, heavier ships are charged more to transverse through the canal (Panama Canal Authority, 2012). Even with these traditionally large contributing economic sectors, tourism continues to be the top revenue earner for the economy of Panama. Social/Cultural Environment The growth and expansion of the service industry in Panama has a direct influence on the social and cultural environment of Panama, which in turn has an effect on what Panama can offer its residents and visitors. As international arrival numbers continue to increase, construction of new hotels and supplemental tourists enterprises will expand into the less developed areas of the country, thus visitor spending will have more of an economic and cultural impact on communities that historically did not cater to tourists.
1
Currently Panama is largely focused on attracting international tourists to visit the country. With this being the case, we believe that it is important for any foreign companies operating in the country to bear in mind cultural differences that are present or may occur due to these differences. Jungle Adventures will be sure to follow in Kalu Yala’s footsteps in their approach of bridging the cultural gaps. For example, Kalu Yala has a property located in the small town of San Miguel. The interns and directors are respectful of the unique culture of the San Miguel residents and act without making negative impressions on the locals. Wonderful relationships have been fostered and maintained with many of the San Miguel residents, thus creating a positive image for the Kalu Yala brand. Also by employing local residents Kalu Yala is helping to increase the commonwealth of the local community. Jungle Adventures looks forward to being a part of this shared sense of community with San Miguel. With Jungle Adventures bringing groups of tourists through the town of San Miguel, business at the local fondas and mini supers will increase. Therefore, it is important to educate the company’s tourists on our policies to mitigate any negative effects they may have on the community. Our goal is to create a positive economic impact on the town of San Miguel while not disrupting the community’s culture. Natural Environment The economic impact from tourism is vital to the Panamanian economy. Ecotourism has the potential to be highly beneficial due to the country’s rich marine habitats and forest biodiversity. Jungle Adventures by Kalu Yala will promote and eventually educate our guests on the importance of living and working sustainably within nature. With the rainforests, mountain retreats, stunning beaches as well as the seven indigenous Indian cultures that reside in Panama; these sectors represent a variety of opportunities for the tourism sector (Ah Panama, 2012). Panama is the southernmost country in Central America with access to both the Caribbean Sea and Northern Pacific Ocean making it an ideal tourist destination. The area of the country is 75,420 square kilometers with water coverage only accounting for 1,080 square kilometers of that total. Panama’s interior terrain consists of steep rugged mountains and dissected upland plains. The coastal areas are largely plains and rolling hills. Due to the diverse landscape and vast amounts of foliage and wildlife, Panama can easily be used as the basis for eco-‐tourism promotion as we will be doing for Jungle Adventures by Kalu Yala. (CIA World Factbook, 2012) At this present time, according to the CIA World Factbook (2012), Panama divides its total land so that 7.26% of it is arable land, 1.95% is set aside for permanent crops and 90.79% is used for other uses such as roads and city infrastructure. For our company specifically, the Kalu Yala Valley will be using a portion of the land strictly for farming. Although this will not significantly or directly impact the statistics for Panama, it is important that the land is maintained in a way that will promote a sustainable lifestyle that encourages living off the land. In Panama the country has protected 30% of its land through conservation and 25% through national parks (CIA World
1
Factbook, 2012). This is a step forward and shows the importance of land use especially for larger sites such as the Kalu Yala Valley property that encompasses over 500 hectares. Between 1980 and 2005, five of Panama’s sites have been declared UNESCO World Heritage sites: On a cultural side, the archaeological site of Panama Viejo and the Historic District of Panama has been protected since 1997. The fortifications in Portobelo, San Lorenzo have been established and untouched since 1980 as they hold cultural significance to the country’s history. The natural sites that have been protected include the Coiba National Park, Darien National Park (1981) the Talamanca Range, and the La Amistad Reserves (1983). The most recent addition to Panama’s UNESCO World Heritage list is Coiba National Park. This park is considered one of the most important protected sites in Panama due to its abundant and rare marine life. (UNESCO, 2012). Panama faces five major environmental issues. These include water pollution, deforestation, land degradation, soil erosion, and air pollution. These issues are discussed in more detail below. The issue that concerns our company and the Kalu Yala valley the most is water pollution, which can be attributed to agriculture run-‐off into rivers, streams, lakes, the ocean, as well as other freshwater tributaries. In order to provide safe drinking water to staff and visitors, Kalu Yala has found two solutions. These include a water filtration system located in the main rancho as well as a freshwater pipe that runs from a tributary at the very top of the mountain to a location within five minutes of the Kalu Yala base camp. Potentially, within the next year, Kalu Yala will have its own purified water system. Deforestation is an issue that is omnipresent throughout the country. Panama loses more than 1% of its primary forest every year. This directly threatens the canal, which is the most important source of income for Panama’s economy as the tropical cloud forest of the canal ensures the flow of water needed to operate the canal locks. The population growth in these forests has declined forest coverage from 80% in 1952 to 15% in 1994, which has led to soil erosion into the canal. The reasons for deforestation are road construction, logging and colonization. The Darien Gap, which is located within close proximity to the Kalu Yala Valley, is a key area of concern due to talk of opening the almost inaccessible region to colonization (Mongabay, 2012). Land Degradation and Soil Erosion together have led to the siltation of the canal, are becoming more of a problem every year. Soil erosion is the root of many current issues found in urban areas, in turn meaning that the cities are becoming overcrowded and people are even beginning to invade the indigenous lands and national parks (Panama News, 2012). Air Pollution in Panama exceeds the norms seen internationally. The main cause being due to unregulated vehicular emissions, which is an issue that needs to be addressed. Hopefully with the introduction of the subway system, this should encourage public transport thereby reducing air pollution from automobile traffic (National Geographic, 2012).
1
Jungle Adventures by Kalu Yala is dedicated to educating those that come to explore the valley with us on the importance of living sustainably and being environmentally conscious. We strive to be a company that considers the environment in all of our daily operations, activities, and throughout all of our locations. Legal/Regulatory Environment Business Registration DoingBusiness.org, a project funded by the International Finance Corporation (IFC) and the World Bank, ranks Panama as #23 out of 184 different economies regarding “time and cost for a small to medium-‐size limited liability company to start up and operate formally (2012).” Neighboring countries Nicaragua (#131), Costa Rica (#128), and Colombia (#61) are rated significantly lower. According to the website, for Jungle Adventures by Kalu Yala to become a legal entity, there are no less than six steps required that will cost a minimum of $500 to carry out:
1. Hire a registered agent to represent the company and write articles of incorporation 2. Notarize articles of incorporation
3. Register at the Mercantile Division of the Public Registry and pay the annual tax (i.e. register with the national government)
4. Obtain a notice of operation through the Panama Emprende website 5. Register with the local municipality in San Miguel (done through step #4) 6. Register with the Social Security Administration There may be additional steps for Jungle Adventures by Kalu Yala to operate legally. According to Panama Offshore Legal Services and the Better Business Bureau of Panama, sanitary permits and fumigation permits may also be required. As a tour company, registration is also required with the Panamanian Tourism Authority. This only costs $10, but Gustavo Chan (founder of Panoramic Panama, personal communication) has indicated that there must be a manager with five years of experience working in a travel agency. Registering and operating legally seems to be quite feasible, but there must be consultation with a legal team before this tour company can become independent of Kalu Yala. Kalu Yala already has significant legal connections and wants to see businesses succeed on their property. Therefore, the legal relationships that Kalu Yala has already established will make outside investment more feasible and increase the likelihood of an outsider taking on this company. Until this happens, Jungle Adventures by Kalu Yala can continue operating under the Kalu Yala Internship Company, although the liability waiver currently in place needs to be altered to make it more applicable to the tourism operation. Labor
1
Panamanian law requires that no more than 10% of employees can be foreigners. In some cases requiring certain specialized skill sets, this number can be increased to 15%. As long as Jungle Adventures continues to operate under the Kalu Yala Internships umbrella, this does not need to be addressed at this point. Once Jungle Adventures becomes its own company, there are many restrictions to abide by in regards to labor. The minimum wage per month is $438.60 with a maximum of 6 working days allowed. Overtime is permitted but is limited to 9 hours per week and a maximum of 3 hours per day (Panama Offshore Legal Services). A two-‐month period of 50-‐hour work weeks is allowed during the event of high-‐season. After one year of employment, employees are entitled to 22 paid days of vacation annually (doingbusiness.org). Taxes Paying taxes is a complicated process in Panama and Jungle Adventures will need at least a part-‐time accounting professional. As of 2012, DoingBusiness.org rates Panama 172nd out of 185 measured economies in regards to “the taxes and mandatory contributions that a medium-‐size company must pay or withhold in a given year, as well as measures of administrative burden in paying taxes.” The organization estimates the total tax rate to be 42%, but this includes many taxes that do not apply to Jungle Adventures. The corporate income tax in Panama is 25% and that figure is what has been used in all forecasting efforts. There are several incentives and deductions for entrepreneurs, especially in the tourism industry; and these should be examined with a legal/ tax professional to ensure Jungle Adventures pays as little tax as possible. The 25% figure may be somewhat optimistic, but offers a reasonable base for forecasting. The subject of taxes represents one of the larger research gaps remaining in the overall operation of Jungle Adventures.
1
Financial Planning and Forecast What has been accomplished up to this point has been done with very little investment. In order for Jungle Adventures to expand, additional investment will be needed. The following start-‐up costs are seen as necessary in order for Jungle Adventures to have a viable tourism product: Rancho: $5,000 Additional tables and chairs: $200 Changing room: $1,000 Extra boots/ galoshes: $150 Website: $500 Mosquito nets: $120 Bathroom: $400 Hammocks: $100 Cell phone: $200 Total startup costs: $8,220 These items achieve slightly more than a minimum viable product. We want to offer more than the bare minimum in order to build upon, rather than detract from the overall Kalu Yala brand and we feel that these investments allow this to happen. Monthly fixed Costs In addition to these physical items, a tourism director should either be added to the Kalu Yala Internship Company or employed under the newly created Jungle Adventures by Kalu Yala. A starting salary of $1,000/month would be sufficient. Other fixed costs include website maintenance, cellular phone service, marketing materials, and trail maintenance in the valley. A summary of these monthly fixed costs is as follows: Tourism Director: $1,000 Website maintenance: $25 Cell phone service: $20 Marketing materials: $50 Trail maintenance: $40 Petty cash: $200 Total Monthly Fixed Costs: $1,335 It is important to note that these costs do not include monthly retainers for legal or accounting services. As the business becomes closer to operating officially, these will have to be incorporated. It is hoped that Kalu Yala’s relationships with legal and accounting professionals will help to offset the costs that these services incur. The figure arrived at above is likely lower than actual monthly fixed costs but comprises a budgeting foundation for the way this business will be conducted in the short-‐term. Variable Costs These costs vary dependent upon the number of guests per trip and the number of trips per month. Variable costs include food, transportation, a bonus to the valley chef per meal prepared, and guide
1
services. For a more detailed examination of these costs, please see the shared Google Document entitled Jungle Adventures Forecasting Fall 2012. Under every scenario examined, transportation costs comprise over half of all variable costs with our current arrangement. Investing in a company van could greatly reduce these costs over several years, but remains a risky investment with the current valley access situation. Supplying transportation to the valley should be the highest investment priority after the start-‐up costs mentioned above. Forecasting The current forecasting model begins in January 2013 and ends in December 2014 (Please see Google Spreadsheet: Jungle Adventures Forecasting Fall 2012, “Yearly Forecasting” sheet). With Kalu Yala’s dynamic environment, it would difficult to forecast accurately beyond this two-‐year window.
1/13 2/13 3/13 4/13 5/13 6/13 7/13 8/13 9/13 10/13 11/13 12/13 Number of Trips
2 4 4 6 6 6 6 6 4 4 4 0
Total Guests
12 24 32 48 48 48 48 48 40 40 40 40
Guest Price
80 80 80 80 100 100 100 100 90 90 90 0
Net Income
-1099 -863 -471 -39 921 921 921 921 321 321 321 -1335
Rolling Balance
-1099 -1962 -2433 -2472 -1781 -1091 -400 291 532 773 1013 -322
1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/14 11/14 12/14 Number of Trips
8 8 8 8 8 8 8 8 4 4 4 0
Total Guests
64 64 64 64 64 64 64 64 40 40 40 0
Guest Price
125 125 125 125 125 125 125 125 100 100 100 0
Net Income
3073 3073 3073 3073 3073 3073 3073 3073 521 521 521 0
Rolling Balance
1983 4287 6592 8897 11202 13507 15811 1811 18507 18898 19289 17754
*Income begins to be created in May 2013 while the rolling balance becomes positive in August 2013. The company finishes in the red for the year but start-‐up costs are recovered by April 2014. The company finishes 2014 with a balance of roughly 2 times start-‐up costs.
1
Number of Trips and Guests Beginning in January, there are two trips forecasted to take place with each trip bringing six people to the valley. Two trips are appropriate as interns and the new tourism director settle in and prepare to take on this business. Six people represent 75% of our maximum capacity at this point. In February and March four monthly trips are expected to take place with six people per trip in February and our full capacity of eight people in March. By April, we would like to run six trips at full capacity to fully take advantage of the dry season and upcoming summer in the United States. From April-‐August, we are expecting to run six trips of eight people every month for 48 total guests per month. This is ambitious but we feel like a dedicated tourism director along with the cooperation of several interns can make these goals achievable. For the rainy season of September-‐November we want to run four trips but increase our maximum occupancy to ten guests. Demand is expected to be lower during this time of the year but steady enough to continue operating. We are expecting to receive a total of forty guests in each of these months. We do not plan on operating any trips in December 2013 or 2014 due to the holidays and hectic travel schedule of Kalu Yala employees and interns. This time could also be used for repairs and any maintenance that needs to take place. Pricing From January 2013-‐April 2013 we are keeping the price very low at $80. We will not have our own tourism rancho nor bathroom and the experience will still be quite rugged. Also, we want to ensure the maximum number of guests to help work out any issues before ramping up from April-‐August. Once May 2013 rolls around, the experience should be a bit less rugged as we should have our own rancho, bathroom, and changing rooms. As summer in the United States comes around, demand is expected to be very high as this is a common time for many backpackers to be traveling. For these reasons, the price will be raised to $100, which still falls within most backpackers’ budgets for a three-‐day excursion. For the rainy season of September 2013-‐November 2013, the price will drop back down to $90. This will basically allow us to break even for these months while hopefully still building the brand and reputation of the business. The price will move up to $125 for January 2014-‐August 2014. This will reflect the expanded product offerings and expected to take place in the valley over the next year. The company will also have a year of experience and all major issues should be resolved.
1
This more refined experience, taking place in the dry season, along with an expanded product offering and a building brand reputation will permit a higher price tag for this excursion. The price will drop back down to $100 for the rainy season of September 2014-‐November 2014. Net Income and Rolling Company Balance The company expects to start creating income by May 2013. This will occur after we have the facilities in place to raise the price to $100 and have operated at full capacity for two months. Running six trips of eight people at a price of $100 creates a net income of $921 before taxes. By August 2013, the company’s rolling balance will be in the positive at $291 but will finish the year at $-‐321.75 due to not running trips in December. In January of 2014 we will truly begin operating at full capacity. Running eight trips of eight people at $125 per person creates a net income of $3073 before taxes. Operating this way from January 2014-‐August 2014 will lead to significant profits. This forecast also includes a $200 raise for the tourism director or other associated costs. By April 2014, with a rolling balance of $8897.25, the start-‐up costs mentioned above will have been fully recovered. As the rainy season rolls around and the price drops, our profits will be lessened but the company is still expected to finish the year with a rolling balance of $17,754, roughly $9,000 more than the initial start-‐up costs. Notes on Forecasting These forecasts do not include legal or accounting fees, which are expected to be shared with Kalu Yala, S.A. Also, the tax rate used in forecasting has been estimated at 25% although in reality this may be a bit higher. However, there are many government incentives for tourism businesses and possible tax deductions so 25% may be a bit on the positive side but should be relatively close to the actual tax rate. For these reasons it may take a bit longer to recoup the initial starting costs and make profit, but these numbers offer a fair representation of what we expect to happen and clearly show the opportunity to make money through this business venture.
1
SWOT Analysis
Strengths Weaknesses
· Kalu Yala’s valley location – being set in the untouched jungle means that we have no current fees to use the land
· Internal resources – Kalu Yala has a great support system, staff on hand to help
· Pricing – competitive pricing due to the resources that Kalu Yala has and allows Jungle Adventures to utilize.
· Unique Experience – we pride ourselves on being one of the few jungle adventure tour companies within close proximity to Panama City
· Social Aspect– the interactions between travelers, staff, and Kalu Yala interns create an extra element to the environmental experience already provided
· Currency – the US dollar is used in Panama · Kalu Yala Development – as Kalu Yala grows and
brings more entrepreneurial companies to the valley, we too as a company will grow and more tourism activities will be developed.
· External Resources – the contacts that Kalu Yala already had as well as the contacts that Jungle Adventures has made outside of Kalu Yala are invaluable and we will continue to grow in number and strength
· Limited Activities – although at the present time the list of activities is not extensive, in the future we hope to bring more options or form partnerships with future businesses operating in the valley to facilitate more activities into our tours.
· Limited Amenities – we offer basic amenities. As the valley development grows, we will have access to more amenities such as clean running water, plumbing, electricity, internet access, etc.
· Transitional Phase – an issue that needs serious consideration is the period between intern departures and intern arrivals which is spaced a month apart. This issue has been addressed further and a plan of action can be viewed in the Operations Manual
· Defining ourselves to the market –calling ourselves an adventure company even though we have limited activities. In the future, we can fulfill this title, but in the meantime our company name can be misleading to some. However calling ourselves a retreat or an excursion also gives the wrong impression. Attention has been given to this and we have continued with the name Jungle Adventures by Kalu Yala as that is what we strive to be
· Communication Disconnect – Communication is one of the largest challenges between the valley and the city as the valley has no internet or phone lines. Currently we send messages with those going into the valley when we can or we make do, which has worked so far. However this may be an issue when the company has more frequent trips so
1
further consideration is needed to fix this problem. · Rainy Season – Lasting from September to
January this means that the weather is not ideal and activities cannot always go ahead as planned. We therefore need to have contingency plans in place for rainy weather
Opportunities Threats
· Network and Publicity – in Panama City itself there is an opportunity to expand our network as well as use the current network that we are apart of in order to promote or use resources that are available to us and them. Publicity is something that the company has thought of and we want to engage in community events as well as host our own to get the promotion that we need as well as make a difference and support our networks where we can
· Expansion of Tourism in Panama – this sector is the largest growing in the country and therefore we are coming into an ideal situation where the market is continually expanding
· Working with locals – helping locals through our business keeps us on their side and gives them the opportunity to see what we are doing and help them as well as help ourselves
· Sustainable Practices – being immersed in the jungle gives us the perfect opportunity to perfect this from the land use through to disposal of waste. We already use a variety of practices and will continue to do so as the valley develops and grows.
· Company Evolution into our market – we have the ability to continuously evolve as both this company and Kalu Yala Development grows in size and strength. Once the first village is built, then more activities will become available for tourists which will evidently start to set us apart from other tour operators.
· Kalu Yala Development -‐ As both Kalu Yala Internships and Kalu Yala Development grows, we will have the opportunity to expand with them and utilize the further resources that those companies gain and
· Competitors – there are many tour operators in Panama, few offer what we do and therefore an option is to work together to promote one another
· Expansion of tourism in Panama – with sector expansion comes the threat of more competitors so we need to ensure that we are the best at what we provide to our tourists
· Relationship between intern company and Jungle Adventures – this needs to be structured well so that no one feels like they are unwelcome into the valley property. We will ensure that communication with the valley residents occurs so they know when and how many visitors will be joining them in the valley. The idea is to work together and become a community whether staying for 3 days or 3 months
· Licensing and permits – if these are not correct or up to date then the company cannot run legally and could be fined or even shut down
· Kalu Yala company failure – if Kalu Yala were to fail then this would implicate Jungle Adventures by Kalu Yala as we are working underneath their umbrella would fail as well.
· Economy – although we are past the global recession, the economy in many countries is still not as strong as it was pre 2007 so this can often be a threat as it would cause tourists to potentially avoid Panama as a destination. Problems will arise if Panama’s GDP lowers for many reasons but especially with tourism as a great area of growth Mother nature – although the weather is dry for the majority of the year, during the rainy season, it
1
produce
is unpredictable so contingency plans will need to be set in place to account for bad weather. Natural disaster can and do occur, we have no means of controlling this we can only plan for this in the unlikely event that something could occur
jsa Backpacker Trail -‐ Our target market is difficult to trap as they come into the city for a short period of time and then leave for one of the more popular locations in Panama
Issue Analysis The SWOT analysis allows us to understand all aspects surrounding the company. Although a number of weaknesses have been analyzed, they can all be managed or reduced in order to strengthen the company. Our biggest issue to date has been the market to which we are selling. Although our research has proven that we have a product that our backpacker audience is interested in, to attract a greater market share, we need to form relationships with hostels outside of the city in locations such as Boquete, Bocas del Toro and Santa Catalina. Eventually, the development of relationships could expand to Costa Rica and Columbia. Jungle Adventures will implement plans to mitigate or reduce threats as much as possible. Contingency plans will be needed to account for the threat of Mother Nature. If there is rain, we will have rainy day activities available to visitors. If the weather is really bad during the rainy season, then we will cancel or cut trips short. . Everything will be done in order to protect our tourists. Another key issue that needs to be recognized and addressed is the welcoming of tourists into the valley when there are already a large number of interns and directors living there. We want there to be a community feel that keeps true to the basis of all companies under the Kalu Yala umbrella. With this in mind, there will need to be regular correspondence and feedback with all those in the valley as well as from the tourists in order to make everyone feel comfortable at all times and build on it taking special attention to arrival of tourists into the valley. Currently our weaknesses are issues that can and will be eliminated. Although some of them may not be immediately repairable, with time and growth from all aspects of Kalu Yala, our limited amenities and activities will reduce considerably making us a more sought after tourist destination. Opportunities are always presenting themselves to this company. It always looks for unique means to expand whether that is through a new venture starting under the Kalu Yala Internship Company or simply adding a new activity to what we already offer our tourists. Jungle Adventures by Kalu Yala has strengths in its resources. We have access to a large valley and over time this will become a thriving community where there will be an abundance of adventure activities, which will set us
1
apart from our competitors. This company will play to its strengths and utilize all connections and networking opportunities in order to create a tourism company that is renowned and one of the leading options in Panama.
MARKETING PLAN Target Market Unique Selling Point We are the only sustainable jungle tour that offers visitors an authentic cultural experience within the pristine natural environment located only an hour drive outside of Panama City, and thirty-‐five minutes from the Tocumen International Airport. Objectives The implementation of a strategic marketing plan will enable Jungle Adventures by Kalu Yala to effectively promote themselves to the backpacker market. Both the online and in-‐print materials need to be attractive, engaging, and create a call for action from interested parties. In order to successfully promote to our target market, research has been undertaken to understand the most effective means of communication. The results of this research will be detailed in the next section. Marketing Strategy Introduction Jungle Adventures by Kalu Yala must implement several marketing strategies in order to properly market to backpackers. According to Backpacker Operators Association of New South Wales, hands-‐on research is the best method of determining the wants and needs of the backpacker and thus what is the most appropriate distribution means for promotional material. Studies by the Backpacker Operators Association have also found that the backpacker market reacts differently to mainstream tourism sectors and money can often be more effectively be spent on informal, non-‐traditional methods of marketing and advertising.
No specific marketing or advertising material can ensure the success of Jungle Adventures by Kalu Yala by itself, but with the ideal mix of word of mouth, social media presence, and in print materials like brochures, flyers, and hard copy publications, this adventure company will prosper.
Marketing Background for Backpackers
1
To be able to effectively market to backpackers, it is important to understand their logistical habits. It is essential to know where they come from, how they arrive in Panama, where they are staying, what they want to do during their stay, and where they plan on visiting. The majority of backpackers are coming from an assortment of countries including Germany, the United Kingdom, Canada, Costa Rica, the United States, Colombia and Argentina among others. Countries whose citizens have passports valid for at least 6 months upon entry do not require a visa to enter Panama. These countries include Andorra, Argentina, Austria, Belgium, Bolivia, Brazil, Germany, Ireland, Israel, Malta, Netherlands, Portugal, San Marino, Singapore, Sweden, Switzerland, the United Kingdom, and Uruguay. Citizens from Australia, Canada, Japan and the United States can enter Panama with a tourist visa that is stamped on arrival. The cost stamp upon arrival into Panama is already included in airfare and is valid for a 180-‐day stay (wikitravel.org). Backpackers arrive in the country through a variety of ways; plane, car, bus, boat, and even on foot. The most widely used means of transportation is the Tocumen International Airport, which is about twenty miles east of Panama City. According to Panama Trails, Tocumen International Airport had a reported total of 514,000 travelers during the first quarter of the year in 2012. This represents an increase of 19.9% compared to the same quarter of 2011. The reason Tocumen International is such a large hub for transportation can be explained by its well-‐connected flights with the Americans and its non-‐stop flights to almost twenty countries in the region. If entering the country by car or bus, backpackers will have to travel from Costa Rica to enter the country. No roads connect Central America to South America so car and bus are out of the question for people looking to come from the south. As for boat entrance into the country, backpackers can choose to enter by cruise line, private sailboats, or banana boat. Typically, all entrants into Panama from boats come through Colombia, but others come from Ecuador and Venezuela. The final means of entering the country is on foot. This is possible by backpackers hiking across the Darien Gap from Colombia or travelers coming in through Costa Rica. The Darien Gap, although attractive to the extreme backpackers and hikers, is considered one of the most dangerous routes in the world. Skilled guides are needed to safely escort travelers through the Darien Gap (WikiTravel.org). After entering Panama, backpackers will stay in an assortment of different lodging options. The majority will stay in hostels that provide quality services and products at a reasonable price. As previously discussed, backpackers are looking for a hostel that is inexpensive yet is in the center of a city or town and is located near a variety of sites and attractions. While in Panama, backpackers can chose from a long list of activities to participate in. Some of the top activities include zip line tours, whitewater rafting, bird watching, hiking, island hopping, partying, snorkeling, scuba diving, surfing, fishing, wildlife tours, museum tours, canal tours, coffee farm tours, camping, and participating in festivals. The backpacker hotspots include Bocas del Toro, Panama City, Kuna Yala/San Blas, Boquete, David, Santa Catalina, and the Darien Province. Integrated Marketing Communications (IMC)
1
Advertising Advertising is of the utmost importance for Jungle Adventures by Kalu Yala. The most effective way to market to the backpacker industry is through an assortment of digital and traditional marketing strategies. Advertising will also be used to gain a positive reputation in Panama and throughout the tourism industry as a whole. Digital Marketing To have an effective marketing strategy we need to develop a strong social media presence. According to Backpacker Operators Association of New South Wales, backpackers are generally well educated and familiar with the latest technology. The Internet can be particularly effective in reaching this market. An effective and well developed website can benefit Jungle Adventures by Kalu Yala greatly, but it must be well managed and maintained to create a reputable brand. Information needs to include what our product is and what services we provide, where we are located, how much we charge, how we can be contacted, and how to book. The website should not be too cluttered and should include simple graphics and colors that will entice the eye. Online booking should be established only if a secure server system is in place and quickly acted upon. This could be a key advantage for Jungle Adventures as many tourism offerings in Panama can not be booked online. The website will be an integral part of the advertising. It will host all the information about the company and our trip as well as being a means of booking. Backpackers are known to research online and look at company websites prior to committing to an excursion, so our website needs to be professional and contain vital information while looking exciting and engaging to our target audience. Social media is a key component to the marketing mix for Jungle Adventures. The use of social media will serve to complement our in-‐print marketing materials. The Jungle Adventures staff hopes to engage and interact with our customers through these identified outlets. The current social media outlets that are most commonly used by backpackers are facebook and twitter. A strong online presence will also be maintained through Internet searches, trip review websites and company websites. It is essential that we constantly update and regulate our online presence in order to keep attracting tourists as well as continually promote the company. The Jungle Adventures staff will undertake various social media efforts in order to attract and engage our target market. The team has created a facebook page, which is updated at minimum two times per week. As operations expand, and the page has more followers, it is recommended that the page be updated daily. Future strategies could include deals for facebook followers and various contests. Jungle Adventures plans to expand its social media offering to include twitter, youtube, foursquare, and other popular outlets. Traditional Marketing
1
Brochures, flyers, and handouts are great ways to market to backpackers. They are easily accessible when placed on bulletin boards at hostels and throughout airports. They also give backpackers the option to pick up travel information and potentially use these for scrap booking. Marketing materials such as these are relatively cheap to produce and should include people based images such as action activities such as zip lining, attractions, social and cultural life, environment/nature, and native wildlife.
Another advertising mechanism that will be utilized is the use of promotional materials in hostels and local businesses, including restaurants, shops and bars that are prominent to our target audience in Panama City. Our target market will most likely be staying in hostels. Having spoken to a number of these and with their cooperation we shall post flyers on their bulletin boards as well as eventually having a spot on their websites this will enable us to have a good and strong client base. Also by providing them with an assortment of pamphlets and a flyer stating our information and contact details we will gain momentum to attract a large audience and get a name for ourselves in the city.
One of the most effective and cheapest marketing strategies is word of mouth. According to Backpacker Operators Association of New South Wales, backpackers’ travel itineraries are rarely planned prior to arrival and travel choices are often made after discussions with fellow backpackers about the must see sights and activities, the best accommodation, most reasonable accommodations, and the best transport options. Based on this research, we want a buzz around town to be created about Jungle Adventures. Therefore, we plan to host a familiarization trip where we will invite hostel owners and staff, local businesses that we will be promoting in to come with us at a subsidized rate so that they can tell their tale to those that ask about Jungle Adventures by Kalu Yala. Pricing Strategies and Sales Promotions The staff of Jungle Adventures has planned a number of promotional sales incentives in order to test our product, and create buzz surrounding our trips. In order to access the visitor satisfaction level with tour flow, activity offering, and identify any shortcomings before Jungle Adventures officially markets to the public, a trial trip has been scheduled for October 18-‐20. The trial run will take place with six individuals who are recruited from Luna’s Castle and are given a highly discounted price in return for their comprehensive feedback. After analyzing this feedback, the staff is confident that we will be able to make the necessary changes to the itinerary, and tour flow with an aim to increase visitor satisfaction on subsequent trips.
Creating a partnership with local hostels, restaurants and shops which cater to our target market is also crucial to our success. We will conduct a familiarization trip for those owners and managers who are identified as having the biggest influence on the travel decisions for backpackers who visit Panama City. The first trip will include select individuals from Luna’s Castle, Mamallena Backpackers, Hostel Viento Surf, Hospedaje Casco Viejo, Panamericana, and Hostal Urraca. These
1
trips will be offered free to these identified individuals with an aim of having them experience the tour so that they will recommend and effectively sell Jungle Adventures to their hostel visitors. In the future, familiarization trips will also be planned for influential personnel at various magazines, newspapers, and social media experts. After further research in our target market’s specific reading habits and interests, these companies will be further defined but examples could be National Geographic Explorer and the Huffington Post. Product sweepstakes or giveaways are also a great way to entice backpackers to participate in our adventure company. Products such as t-‐shirts, koozies, postcards, and occasional trips could be given away to entice backpackers. Personal Selling Personal selling will be a core promotional activity of Jungle Adventures by Kalu Yala. This type of selling will be needed to prompt guests to book with us, especially in the beginning phases of the company.
To get the information out to the public, we must make ourselves known. This means going and passing out promotional materials to all the backpacker hotspots such as hostels, restaurants, bars, and shops. Promotional materials we will be using includes flyers, handouts, brochures, t-‐shirts, pens, koozies, bandanas, stickers, as well as many others.
The success of Kalu Yala Jungle Adventures depends on establishing good working relationships with the backpacker hotspots mentioned above. These businesses are already well-‐known and trusted within the backpacking community that we are looking to sell to. Details on strategies to create these relationships are available in the next section of this document.
Sponsorship Strategies In the creation of relationships with the owners and managers of the local hostels, Jungle Adventures by Kalu Yala would like to provide sponsorship opportunities to these establishments. We will place their logo onto our marketing materials in exchange for placement of our logo and product onto their websites.
Other sponsorship efforts will be applied towards partnering with established community events as well as hosting our own events. Jungle Adventures plans to sponsor local events once every quarter. By providing sponsorship money to these events, we will be able to raise brand awareness and distribute our materials to event attendees. Jungle Adventures aims to increase publicity and foster relationships through hosting appreciation parties for our supporters. Further plans include a documentary night, open to the public, that focuses on topics such as environmental issues, wildlife conservation, sustainability, culture, outdoor recreation and any other topics that incorporate how we live and interact with the world around us.
Earned Media
1
As our volume of clients grows they will want to discuss their experiences through a variety of outlets. These include reviews on TripAdvisor, Yelp, Facebook, Twitter, and blog sites, as well as other forms of media. This customer-‐based media coverage can also be very beneficial through the promotion of newspapers, travel magazines, radio and television shows. This is a great way to increase awareness and credibility of Jungle Adventures by Kalu Yala. Guidebooks are an essential travel item for backpackers and they are known to carry at least one to two guidebooks on their trip. Some of the most well known guidebooks include Lonely Planet, Moon Handbooks, and Frommer’s. These guidebooks have no paid advertising so the only way to establish presence in these books is to ensure that reviewers are aware and pleased with the product being offered. A good experience for the reviewer means a good review for Jungle Adventures by Kalu Yala. Community Outreach Jungle Adventure staff would become involved in sustainable outreach by volunteering with local projects and organizations, enabling us to further expand our network and relationships, which will help spread the word of what Jungle Adventures by Kalu Yala has to offer. This effort would provide a way to connect different groups of people within the city by having the Jungle Adventure crew and the rest of the Kalu Yala network to become involved as well. Implementation of Marketing Strategies September: Jungle Adventure staff will make site visits to six hostels to research our target market and introduce ourselves to the managers and owners. October: Site visits will be made to local shops and restaurants to post the marketing materials for trial run #1. During these visits, good working relationships will be developed with the hostel owners and managers in an effort to educate these key individuals on our product. A creative session will be held and marketing materials will be discussed and decided upon. An online presence will be created at this time through social media and e-‐mail. After trial #1 is completed, we will be able to pivot and redirect as necessary based off of the feedback received from the first set of guests. November: Trial run #2 will take place in November. Flyers will be reposted to recruit backpackers for the trip. The group will check on previously posted marketing materials that included dates and replace these with new in-‐print materials. Social media outlets will be periodically updated, and a company website will be created. The logo and other materials will be submitted to creative agency to perfect the company’s image. Post Internship: After the Fall 2012 internship is complete, we hope that Jungle Adventures by Kalu Yala will continue to run and prosper as a company. The marketing efforts will still need to be executed to successfully continue running backpacker adventures into the jungle.
1
These future strategies will include producing Jungle Adventures merchandise that can be distributed and sold, developing and implementing plans for established community events, participating in sustainable volunteer outreach, creating an extensive online presence and continuing to foster and create relationships within the tourism community of Panama City and San Miguel. Marketing Controls A number of marketing controls have been put into place in order to effectively monitor the company’s performance. Sales and profits will be evaluated periodically dependant on the specific marketing strategies that are in place at the time. Monthly reporting will help Jungle Adventure staff to analyze trends and to reassess marketing tactics in order to assess what type of marketing is most effective. Like most other tourism businesses in Panama, Jungle Adventures will need to implement ways to offset seasonality during the rainy season. Strategic creative marketing and special pricing will be employed during this slower time in order to attract backpackers to our tours. Jungle Adventures by Kalu Yala will also monitor hits on all social media outlets. All social media marketing channels will be updated at the minimum of once every week. The number of hits that the company receives will reflect the amount of Internet presence we have. Jungle Adventures aims to have a large Internet presence determined within the first six months of the company’s life cycle. The success of marketing communications will also be reflected in the results of a post-‐trip survey. Although surveys are often seen as being less effective than other methods of communication, Jungle Adventures by Kalu Yala believes that with a small group of backpackers, the anonymity of a survey will give us essential feedback. The goal of the survey is to inform us about booking behaviors and tour satisfaction in order to update marketing strategies, tour offerings and to constantly reflect the needs of our clients. A sample survey can be viewed in shared Google Document entitled Jungle Adventures Survey Fall 2012.
1
REFERENCES
Adventure Tours Panama. (2012). Retrieved October 2012 from: http://www.adventuretourspanama.com/ Ah! Panama. (2012). Environment. Retrieved October 2012 from: http://www.ahpanama.com/general_information/environment Backpacker Operators Association of NSW (BOA). (2012). Tourism New South Wales. Retrieved October 2012 from: <http://archive.tourism.nsw.gov.au/Backpacker_Tourism_p726.asp&xgt B & B La Estancia. (2012). Retrieved October 2012 from: http://www.bedandbreakfastpanama.com/ Beaubien, Jason. (2012). Panama booms while Poor Watch from Afar. Retrieved October 2012 from: http://www.npr.org/2012/04/16/150727218/panama-‐booms-‐while-‐poor-‐watch-‐from-‐afar Business Panama. (n.d.). Investing in Panama. Retrieved October 2012 from: http://www.businesspanama.com/investing/opportunities/real_estate.php
1
Casa de Campo Country Inn & Spa. (2012). Retrieved October 2012 from: http://www.panamacasadecampo.com/ Doing Business. (2012). Economy Rankings. Retrieved October 2012 from: http://www.doingbusiness.org/Rankings Doing Business. (2011). Starting a Business in Panama. Retrieved October 2012 from: http://www.doingbusiness.org/data/exploreeconomies/panama/starting-‐a-‐business Eco Circuitos Panama. (2012). Retrieved October 2012 from: http://www.ecocircuitos.com/ Hannam, Kevin and Ateljevic, Irena. (2008). Backpacker Tourism: Concepts and Channel View Publications, Clevedon; Buffalo Monkey Lodge Tours and Bed & Breakfast. (2012). Retrieved 2012 from: http://monkeylodgepanama.com/ National Geographic. (2012). Deforestation. Retrieved October 2012 from: http://environment.nationalgeographic.com/environment/global-‐warming/deforestation-‐overview/ Panama Better Business Bureau. (2011). Starting a Business in Panama. Retrieved October 2012 from: http://www.panamabbb.org/businesses/investing-‐in-‐panama-‐and-‐business-‐matters/investing-‐doing-‐business-‐in-‐panama-‐business/ Panama Canal Jungle Tour. (2012). Retrieved October 2012 from: http://www.gatunexplorer.com/ Panama Canal Authority. (2012). Tolls Assessment. Retrieved October 2012 from: http://www.pancanal.com/eng/op/tolls.html Panama Offshore Legal Services. (2011). How to Start a Panama Business. Retrieved October 2012 from: http://www.panama-‐offshore-‐services.com/how_to_start_a_panama_business.htm Panama Offshore Legal Services. (2011). Panama Labor Law. Retrieved October 2012 from: http://www.panama-‐offshore-‐services.com/panama_labor_law.htm
1
Panama Outdoor Adventures. (2012). Retrieved October 2012 from: http://panamaoutdooradventures.com/ Panoramic Panama. (2012). Retrieved October 2012 from: http://www.panoramicpanama.com/ Pearce, P.L. (1990) The Backpacker Phenomenon: Preliminary Answers to Basic Questions. Townsville: James Cook University of North Queensland, Department of Tourism. Property Show Rooms. (2012). Natural Factors in Panama. Retrieved October 2012 from: http://www.propertyshowrooms.com/panama/property/investment/panama-‐investment-‐natural-‐factors.asp Scheyvens, R. (2002) Annals of Tourism Research. Backpacker Tourism and Third World Development. Volume 29, Issue 1. Pages 144-‐164 Sierra Llorona. (2012). Panama Lodge, Private Reserve. Retrieved October 2012 from: http://www.sierrallorona.com/ The New York Times. (2012). The 45 Places to Go in 2012. Retrieved October 2012 from: http://travel.nytimes.com/2012/01/08/travel/45-‐places-‐to-‐go-‐in-‐2012.html?pagewanted=all The World Factbook. (2012). Central America & Caribbean: Panama. Retrieved October 2012 from: https://www.cia.gov/library/publications/the-‐world-‐factbook/geos/pm.html Travel and Leisure. (2012). Hottest Travel Destinations of 2012. Retrieved October 2012 from: http://www.travelandleisure.com/articles/hottest-‐travel-‐destinations-‐of-‐2012/11 Visit Panama. (2012). Panamanian tourism starts 2012 off on the right foot. Retrieved October 2012 from: http://www.visitpanama.com/index.php?option=com_k2&view=item&id=1132:turismo-‐paname%C3%B1o-‐empieza-‐el-‐2012-‐con-‐pie-‐derecho&Itemid=564&lang=en Wikitravel. (2012) Panama. Retrieved October 2012 from: http://wikitravel.org/en/Panama World Heritage Center. (2012). Panama. Retrieved October 2012 from: http://whc.unesco.org/en/statesparties/pa