Business Plan Outline

Customer Analysis

Yolo Airlines was set up with an aim to offer a service that had not been adequately exploited by the competition. The company sought to offer an environment that is not only welcoming but also accommodating to fun-loving young urban professionals made up of upwardly mobile business professionals travelling to attend business meetings or unwind after a weeklong of work. The Airline has since added another demographic group with similar characteristics as the one targeted at the launch of the Airline. This group is made up of up-and-coming and fun-loving young persons (not necessarily those with professional credentials) traveling for business or pleasure. This demographic group comprises of young entrepreneurs running their own businesses and young pre-entrepreneurs experimenting with various business ideas before launching their ideas at maturity. The company has strived to remain 100% customer oriented by sticking to a one-class service. Towards this end, the needs of our unique clientele continue to be met with the Airline presenting a fun-filled package that incorporates inflight entertainment and themes tailored to excite our primary clientele. Two years on, this particular demographic constitutes 80-90% of our clientele. At present, the Airline operates on a single transatlantic route which also happens to be the most active transatlantic route. At present, the Airlines average load factor stands at 96%.

Competitive Analysis

The competition that YOLO regards as posing the greatest threat is JetBlue and Virgin America. While JetBlue continues to be a well-regarded Airline as far as unique and appealing customer service is concerned, Virgin America has a strong selling point which could also appeal to our clientele as well. The Airline essentially sells an upscale experience to customers and offers premium packages on its high-end business traveller package. The premium packages are, however, offered at a premium price with the Airline primarily targeting accomplished business travellers and other high-net-worth individuals. It is, however, important to note that unlike the competition, the YOLO Airlines seeks to offer not only a unique experience to the target clientele, but also reasonable prices for the level of services offered. The low-cost strategy coupled with focus on offering a unique and memorable experience effectively ensures that the Airline is one step ahead of the competition. It should, however, be noted that the company does not essentially seek to compete on the low-cost general end of the market. To be clear, the Airline seeks to be a low-cost carrier in a specialized category that would otherwise attract premium prices.

Marketing and Management Plan

A significant portion of the Airlines budget had been allocated to advertising and marketing within the first two years of operation. The relevance of reaching out to our target market cannot be overstated. This is more so the case given the need to let the target clientele know that the Airline has something unique and different to offer. As a matter of fact, the Airlines survival within the first five years of operation is largely hinged upon how well word that the company has something unique to offer gets out there.

To begin with, as far as the product is concerned, the Airline has a unique service on offer, i.e. a unique experience coupled with topnotch entertainment and technological features, at a cheap price. The products taps unto the tendency of most of the Airline travel options being dull and uninspiring. In contrast, our target clientele is fun-loving and is often used to a formal setting. Having in-flight attendants clad in designer wear and offering music and movie categories that suit the tastes of this demographic group would be reasonable business move to nurture and sell. The Airlines name is also indicative of our target market, focus, and drive. YOLO is a popular acronym meaning You Only Live Once! This particular acronym has become a rallying call amongst those who believe in working hard and playing hard as well. Therefore, our target demographic will most definitely identify with the same.

Next, we have price. Price has got to do with...…flight planning tool is expected to help in the minimization of fuel costs. The tool has an inbuilt load optimizer that helps in the management of payload and weight distribution. It is, therefore, likely that going forward; we are likely to make significant cost savings so as to further enhance the Airlines bottom line.

The Airline would be fully operational with a load factor of 50%. This is a lower break-even point than other companies have. Towards this end, the Airline is better placed to remain profitable throughout short-term downturns in economic activities. At this point in time, the Airline could be deemed a good investment, with a positive ROI. It should be noted that at present, the company has a better ROI ratio than some big players in the industry.

ROI = Investment Revenue Investment Cost/Investment Cost

It should be noted that 6 months ago, the companys stock was trading at $9.43. The same stock trades at $10.89 at present. If Person X were to buy the 1000 shares at the price indicated 6 months ago, and sold the same today, the return on investment would be 15%. See below:

Investment cost = 1000 * $9.43 = $9,430

Investment Revenue = 1000 * $10.89 = $10,890

ROI = ($10,890 $9,430)/ $9,430

= $1,460/$9,430 = 0.15

ROI = 15%.

In essence, the companys ROI is likely to grow going forward as the company gains a footing in the industry. However, given the volatile nature of todays stock market as a consequence of speculative activity and readjustments in the geo-political arena, projecting the ROI an year from now would be rather erratic. However, the company is likely to beat most established names in the airline industry. This is an assertion founded on its ROI in relation to that of other players in the same industry at present. JetBlues ROI over the same period, based on the price of its stock at the time, versus its stock price at the moment would have been (9%). Consider below;

p>JetBlues stock price on 31st of…