The Operational Expenses for the 1st Year

1.	Salary for permanent personnel	358680,00
2.	Products for restaurants and bar	146853,00
3.	Utilities (electricity, water, gas)	6615,72
4.	Wi-Fi	85,32
5.	Stationary items (paper, pens and so on)	180,00
6.	Reserve of money for repair of furniture	300,00
7.	Security services	7200,00
8.	Expences for advertising activity	1451,16
9.	Purchasing of cosmetics (shampoos, balms, soups)	30394,65
10.	Bank loan	19181,25
11.	Taxes	92503,73
12.	Purchasing of chemicals for room cleaning	2750,00
	Total expenses	666194,80

Expenses for next years will be the same but the amount of cosmetics and products for restaurant purchasing will depend on the real amount of visitors for the 1^st year.

The main sources of profit are accommodations in rooms, food and beverage services and organization of celebrations. In the 1^st year it is expected 5 weddings and 10 birthday celebration which bring 5000 EUR of income. Moreover at least 730 people will visit fish restaurant and create 18250 EUR of revenue. As the meal is not included in the room price approximately every visitor (5400 guests for the first year) will eat twice on the ship and will pay 108000 EUR. The total income from F&B will be 126250 EUR.

In the 1^st year the amount of guests depends on the room type and total revenue from providing accommodation services are shown in table 5.

Table 5

The Income from Accommodation Services

Room type	Amount of rooms	Amount of guests	Income
Standard Single
Standard Double
Junior Suit
Suit Deluxe
Total amount			302670,00

Total income for the first year will constitute 433920 EUR.

Forecasting profit for the first year will be -108213 EUR. We consider that in case of creation new hotel it is typical to get losses after 1^st operational year. If to make a supposition that every year the total income will be increasing for 0,2 % and total expenses remain on the same level than on the 6^th year of entrepreneurial activity the hotel “Titanic” will receive the first profit.

Risks

Information about risks and possible ways to reduce or avoid them are shown in Appendix 6.

Conclusion

In process of creating business plan for the hotel on the ship “Titanic” a significant amount of work was made. SWOT and PEST analysis showed that Latvia is an appropriate country to start business, as it has favorable external environment (political, social and economic). Moreover, the American and European tourists were defined as potential target group for the hotel. After the analysis of financial issues we defined that only after 6 year of operating the hotel can get the first profit. That is why we consider that project may be successful and it is necessary to implement it in real life.

Appendix 1

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