PetResort - Final

BSM-MBA Romanian-Canadian MBA program – Graduation Project
August 2009
“PetResort” - Pet Hotel Startup

Business Plan
Madalina Lupica
Gabriel Vlad
Bogdan Chirila
“PetResort” – Pet Hotel Startup Business Plan
Table of Contents
1. Executive Summary...................................................................................3
Ownership........................................................................................ .............3
Startup Summary................................................................................ ..........3
Location and facilities...................................................................................3
Business description.....................................................................................3
Key Financial Indicators.................................................................................3
2. Company Description.................................................................................3
Ownership & Management............................................................................3
Startup Summary................................................................................ ..........3
Location and facilities...................................................................................3
3. Business description..................................................................................3
4. Marketing Audit....................................................................................... ...3
4.1. External Analysis....................................................................................3
4.1.1. External environmental analysis..........................................................3
Social............................................................................... .............................3
Legal.................................................................................... .........................3
Economic......................................................................................................3
Technology................................................................................. ...................3
4.1.2. External situation analysis...................................................................3
Industry Analysis.................................................................................. .........3
Market Analysis............................................................................... ..............3
Marketing Mix (The Five Ps of Marketing)......................................................3
Competitor Analysis......................................................................................3
Customer Analysis........................................................................................3
4.2. Internal Situation Analysis......................................................................3
4.3. SWOT......................................................................................... .............3
Strengths......................................................................................................3
Weaknesses..................................................................................................3
Opportunities................................................................................................3
Threats................................................................................................ ..........3
5. Strategy.................................................................................. ...................3
5.1. Strategy framework................................................................................3
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5.2. Mission............................................................................................. .......3

5.3. Vision..................................................................................... .................3
5.4. Objectives.................................................................................... ...........3
5.5. Competitive position...............................................................................3
5.6. Competitive advantage..........................................................................3
5.7. Competitive tactic.................................................................................. .3
5.8. Key Success Factors................................................................................3
6. Marketing....................................................................................... ............3
6.1. Segmentation, targeting, positioning......................................................3
Segmentation.............................................................................................. ..3
Targeting................................................................................... ....................3
Positioning................................................................................................... ..3
Marketing Plan..............................................................................................3
Marketing Timing..........................................................................................3
7. Operations.................................................................................................3
7.1. Running PetResort..................................................................................3
7.1.1. Setting up Space.................................................................................3
7.1.2. Areas Needed......................................................................................3
7.1.3. Layout and Design...............................................................................3
7.1.4. Special requirements...........................................................................3
7.2. Equipment and Supplies.........................................................................3
7.3. For the Pet Hotel.....................................................................................3
Pet Hotel Checklist........................................................................................3
Dog Walking Checklist.............................................................................. .....3
Obedience Training Checklist........................................................................3
Spa/Grooming Checklist................................................................................3
7.4. For The Office.........................................................................................3
7.5. Selling Pet Supplies.............................................................................. ...3
7.6. Setting our Fees............................................................................. .........3
7.7. Factors that Affect Our Fees....................................................................3
7.8. Policies and Payment..............................................................................3
Setting Policies..................................................................................... .........3
7.9. Day-to-Day Operations...........................................................................3
7.9.1. Scheduling............................................................................... ............3
7.9.2. Hiring and Managing Staff...................................................................3
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Getting Ready to Hire............................................................................... .....3

Keeping Employees Happy............................................................................3
7.9.3. Hygiene, Health and Safety.................................................................3
Cleaning Routine.............................................................................. .............3
Caregiver Safety...........................................................................................3
Pet Health and First-Aid.................................................................................3
Handling Client Complaints...........................................................................3
7.9.4. Pet Hotel Registration Form.................................................................3
8. Financials.............................................................................. .....................3
Bibliography.................................................................................. ...................3
Appendix 1 – Car Lease....................................................................................3
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1. Executive Summary
PetResort is a new company established by three MBA graduates from the BSM-MBA
program. It operates in the travel industry, providing accommodation and
associated services for pets. It caters to dog owners who consider their pets part of
their family and who earn enough to afford premium products and services for their
dogs.
Ownership
PetResort is owned by the three graduates in equal shares and is incorporated as a
LLC (SRL).
Startup Summary
The owners of PetResort each contribute 210,000 RON in cash or land to the
startup. The rest of the initial expenses are financed through a bank loan. The
amount of the loan is 300,000 RON over 5 years at 15.62% interest rate with 6
months grace period.
Location and facilities

The location is in Buftea, a rapidly developing area near Bucharest.
Business description
The pet hotel strives to create an environment for the pet that is as much as its
home as possible. Dogs enjoy large private rooms as well as daily social time in a
play group with other dogs.
Other services provided by PetResort include:
• Transportation of dogs to and from the hotel, which is provided free of

charge for a minimum stay of one week.
• Daycare services. Dogs are dropped off in the morning and picked up in
the evening. During the day they can play with other dogs in the play
area, under supervision.
• Grooming services such as nail trimming, brushing, cleaning and bathing.
• Spa services: Pet pedicure, Teeth brushing, Toenail polish and fur coloring,
Doggy facial, Hair “styling”, Doggy workout, Aromatherapy or special bath
soaps, Massage.
• Obedience training. Basic obedience training is focused on teaching a dog

words or commands that make life with the pet easier, such as how to
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come, sit, stay, get down, meet new dogs or people calmly, and walk on
and off a leash.
This type of services can be also considered a business of “guilt removal”. While the
owner is away on vacation or business, the favorite pet can also have a great time
in a posh hotel. The owner can enjoy the time off without the guilt, knowing that the
dog is well taken care of.
Key Financial Indicators

Profit and Loss Statement (Income Statement)
Cash Flow
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2. Company Description
PetResort is a new company established by three MBA graduates from the BSM-MBA
program. It operates in the travel industry, providing accommodation and
associated services for pets. It caters to dog owners who consider their pets part of
their family and who earn enough to afford premium products and services for their
dogs.
Ownership & Management

PetResort is owned by the three graduates in equal shares and is incorporated as a
LLC (SRL).
Management functions are distributed among the owners and day to day operations
are ensured by an Operations Manager, who is a trustworthy person and a close
relative to one of the owners. The Operations Manager is the interface to the
customers and also works closely with the employees in order to successfully
perform daily activities. Living on the premises, the Operations Manager will also
ensure 24x7 on-site presence.
PetResort will also employ a dog trainer, a dog caregiver and a janitor. They would
all report to the Operations Manager. Medical services and grooming services are
provided onsite by contractors.
Startup Summary
The owners of PetResort each contribute 210,000 RON in cash or land to the
startup. The rest of the initial expenses are financed through a bank loan. The
amount of the loan is 300,000 RON over 5 years at 15.62% interest rate with 6
months grace period.
Location and facilities

The location of the pet hotel is critical to its success. It needs to be near large urban
areas with lots of people who work good-paying jobs and travel often.
Since Bucharest and the adjacent areas fit by the above requirements we
considered a strip of land which was already purchased but was unutilized.
The location is in Buftea, a rapidly developing area near Bucharest.
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3. Business description
The pet hotel business is well established around the world. It aims at providing
better services than the regular kennel. The pet hotel strives to create an
environment for the pet that is as much as its home as possible. Dogs enjoy large
private rooms as well as daily social time in a play group with other dogs.
Other services provided by PetResort include:
• Transportation of dogs to and from the hotel, which is provided free of

charge for a minimum stay of one week.
• Daycare services. Dogs are dropped off in the morning and picked up in
the evening. During the day they can play with other dogs in the play
area, under supervision.
• Grooming services such as nail trimming, brushing, cleaning and bathing.
• Spa services: Pet pedicure, Teeth brushing, Toenail polish and fur coloring,
Doggy facial, Hair “styling”, Doggy workout, Aromatherapy or special bath
soaps, Massage.
• Obedience training. Basic obedience training is focused on teaching a dog

words or commands that make life with the pet easier, such as how to
come, sit, stay, get down, meet new dogs or people calmly, and walk on
and off a leash.
This type of services can be also considered a business of “guilt removal”. While the
owner is away on vacation or business, the favorite pet can also have a great time
in a posh hotel. The owner can enjoy the time off without the guilt, knowing that the
dog is well taken care of.
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4. Marketing Audit
4.1.External Analysis
4.1.1.External environmental analysis
Social
During the last 6 years in Romania the middle class increased due to the
economical development. In Bucharest this social category is higher than in other
cities of Romania, due to the fact that most important companies are located here.
The higher income has driven to a change in consumption behavior; middle class is
the target for supermarkets, real estate developers, tourist agencies, restaurants,
clubs etc. Usually, this people are 30-45 years old, have an income above average,
are living in new condominiums or houses around Bucharest, have 1-2 children, use
to go in vacation outside the country. During the year they travel a lot, both
business-related and for vacation.
Legal
Romania has harmonized its legislation regarding pets with the European Union
legislation.
The governing laws in Romanian legislation are as follows: HCGB 75/96, HCGB
243/2005, OUG 155/2001, Law227/2002, Law 205/2004, and Law 9/2008.
Due to higher legislative focus on animal care our high quality services should be
favored by the improvements in legislation.
Economic
Starting with 2001 and until 2008 Romania’s GDP increased every year; the average
income increased and the structure of population’s consumption modified (in 2008,
28% of expenses were for services). In 2009 Romania was affected by the crisis, in
the first quarter GDP registered a 6.5% decrease comparing to 1st quarter 2008 and
prognosis for second quarter shows 8-9% decrease of GDP.
Technology
The economical development and Romania’s integration in EU made technology
very accessible for Romanian population, especially those who are living in big
cities. The increase of internet usage is the highest in Europe and nowadays
Romanians are used to purchase goods or services or to take information from
internet.
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4.1.2.External situation analysis
Industry Analysis
• Rules of the game – pet hotels in Romania are satellites to vet clinics,
educational schools or breeding farms; because there are just a few
companies in this industry, they are not competing directly: their focus is to
attract new clients, to maintain existing ones, to create the need of the
service. The prices these companies are operating with are meant to
convince potential customers that this service can be affordable for them.
Doesn’t matter if they are offering indoor, outdoor or both accommodations,
the added value that is stressed in promotion is the permanent care,
permanent medical surveillance and the playground dedicated to dogs.
Another point stressed in promotion that these companies are performing is
the previous experience of the owner and / or employees like vet physician or
dog breeder.
• Strategic groups – Based on Price and Location as criteria:

Price
100
PetResort Gabriel Cocu
Marcovet Kris
50
Cabanova Zoopensiune Chino Impex
Pet Joy K9Studio Regal Canin
Super Pet Aldo Mash
Petland LagunaVerde Pensiune
Alpera Bella Shalimar Vet
Eleven Tara's LeonardSumlea
Best Life Caini-ham
Blue Vet Pekingese
5
Country Bucharest and surroundings Location
• Industry life cycle – in Bucharest we found around 15 boarding houses for

pets and in Romania around 25. This figures compared with total number of
households with pets are very low. The degree of occupancy in these hotels is
between 60-100%. We consider this service in introductory phase, because
the product is quite new and nowadays we cannot discuss about a structured
market.
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• Porter’s five forces
Internal competitive rivalry
○ Industry growth – the demand for pet accommodation is still low, but in
meantime the number of companies activating in the industry is low,
too. Competition between kennels is moderate and is non-prices
based.
○ Industry concentration – there are just a few boarding houses for pets
in Romania and in Bucharest comparing to number of registered pets.
The industry is very concentrated and the prices are not influenced by
competition.
○ Intermittent overcapacity – even in periods of the year when pet hotels

are not fully booked, they are not decreasing price. Delivering an
optional service, not a necessity, the price decrease would not increase
demand.
○ Product differences – existing pet accommodation facilities in

Bucharest area are linked to vet clinics, training schools or breeding
farms; boarding houses are secondary activity; these companies are
known in the pet-owner community mainly because of their first
activity; because of this we have a high product difference.
○ Brand identity – the small number of persons who are using this
service tend to be loyal to the boarding house they know, because of
different reasons: the hotel is in neighborhood, if they were satisfied
once with service they see no reason to change it, they assume that
their pet will feel better in a known place cared by known persons;
they trust the vet doctor who owns it.
○ Switching costs – the alternative for leaving the pet in a kennel is to

take it with you in the vacation- an option which is more uncomfortable
and costs more or to leave it in the supervision of another person
(friend, relative, and neighbor) which is risky and problematic; so, the
switching cost for pet care service are high.
○ Informational complexity – for a pet owner the information delivered by

companies which are playing in the industry is not very complex; it is
quite easy to compare offered services.
○ Corporate stakes – because the small number of firms in the industry

and the reduced number of persons who aced this service, the fight is
for creating a market more than fighting with competition.
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○ Exit barriers – are low because accommodation facilities can be used

for other purposes: training, pets for adoption, hospital.
Entry barriers
In pet boarding service, the proprietary learning curve makes the access to
know-how quite difficult, the investment is high, the proper place to develop
facilities is very hard to find, there are legal regulations that should be
followed and the identity of the brand and of the owner is very important. All
these makes access to this industry quite difficult.
Threat of substitutes
A substitute for pet care consists of dog trainers which are working on the
black market.
Bargaining power of buyers
The actual market for pet hotels is undeveloped, so buyers cannot influence
the price level; on the other hand, buyers have a big impact on the quality
and performance of services offered. Because the nature of the business is
very emotional (owners are considering and behaving with pets like their own
children) they are choosing very carefully the hotel in which they let the pet
while they are away from home. Aspects like: heating and air conditioning,
playground, medical surveillance are very important when choosing pet hotel.
Bargaining power of suppliers
○ The land on which to build a pet hotel - the rent or price for land
around big cities is decreasing, but still very high; big surface lands,
suitable for this business (around 5.000 square meters) are hard to
find.
○ Pet food - this industry is very dynamic; after EU integration, pet food
prices decreased and the market increased 10 times comparing to
1999. The main players (medium and premium) are very interested in
making contracts with pet boarding houses, especially with those
which have a pet shop, too.
Market Analysis
Market analysis is mainly based on direct observation, interviews, and magazine /
website articles. Statistical information is quasi-inexistent or is achieved on demand
by large pet food corporations who can afford it.
• Market growth rate - taking into consideration that existing kennels in

Bucharest have average occupancy 80% all year long and 100% during
vacations (summer and December), the market growth cannot be determined
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so accurate and in the end has no such importance because the need, as
small as it is, is not completely satisfied
• Market share - if our dog hotel will have 30 lodges, our market share will be
around 9% (if no other kennels will be opened in this time frame)
• Market concentration - because the number of lodges/hotel is quite low

(from10- 40) the market is very diluted; the first 3 companies have 30% of
the total capacity in Bucharest region
• Penetration - Considering there is no statistical data on this market we had to

come up with a way of computing the market penetration. We have identified
12 hotels with an average number of lodges of 30. Considering occupancy as
reported by several owners is 100% in the summer months and December,
and that it falls to about 60-70% in the rest of the time, we concluded that:
○ 60-70% of occupancy is coming from regulars. They are likely to use

the services about 10% of the time (3 days per month). This turns into
an average of 200 customers per hotel, resulting in a total of 2400
regulars.
○ The rest of occupancy during peak months is coming from

“vacationers”. They are likely to use the service for about two weeks
per year. This results in 3120 “vacationers” (52 weeks / 2 weeks => 26
per lodge * 10 lodges = 260 per hotel * 12 = 3120).
○ We have computed a target market of 20-25 thousands and a

penetration of between 5 to 6 thousands. Penetration rate resulted is
roughly 25%.
Competitor Analysis
Considering our pet-hotel is located near Bucharest, we analyzed existing pet
boarding houses from this region.
Pet hotels are connected to veterinary clinics, breeding farms or training schools for
dogs. Most of them are offering accommodation for dogs, cats and other kind of
pets (birds, reptiles). Usually they have pet shops. There are a few hotels operating
in apartments.
Their main goal is to attract potential clients (pet owners) and to convince them
that during holidays they can leave the pet in their care and the pet will feel like
home and will have good living conditions, proper food, place to play, company, and
medical surveillance.
Our competitors’ strengths are:
• Previous experience in working with pets (like breeders or doctors or trainers)
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• Connections with pets owners society
• Related services which they offer
• For some of them location (near residential areas, good access to main roads,
on the way to airport, in or very close to Bucharest)
Weaknesses:
• Accommodation organized in apartments (less place to play for dogs, many

pets are living in the same room, pets are taken for a walk on the street)
• Weak marketing (poor websites or no website, hard to find on internet,

locations hard to be found)
• No clear positioning regarding target, price policy, additional offers
Customer Analysis
The customers for pet boarding houses are pet owners who go on vacation and in
weekends out of the city, who have frequent business trips (target for night care
and long accommodation period) or who spend a lot of time at work or at shopping
(target for day care). Daycare is not so developed yet as a pet service in our
market. If no member of the family is staying at home or if they don’t have where to
leave the pet when they are away, they are using this service.
Usually customers are choosing the kennel based on the following criteria:
• Services offered (existing playground, separate lodges, medical surveillance)
• Distance from home
• Previous experience
• If they were customers of the same company for different services (ex.: if the
dog was bought from a breeding farm and the farm has accommodation
facilities, too, they will go there; if the dog was treated by a certain vet clinic
or was for training in a certain training school, and the clinic or the school has
boarding house, too, the owner will leave the dog there when he is out of
town).
• Word of mouth
Because this kind of persons are very emotionally involved in the relationship with
the pet, the quality of the service, the offered conditions and the personnel of the
hotel are very important in the final decision
In the period of vacations (in summer and in December) existing pet hotels have full
booking, so clients have to make early reservations. The decision where to leave the
pet is made at least two weeks before accommodations starts.
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The sources of information for pet boarding service are:
• Friends, relatives and other pet owners
• Internet
• Advertising made on pet shops, vet clinics etc.
4.2.Internal Situation Analysis
Corporate Objectives:
• Our intention is to have a functional dog hotel in 12 months for 30 dogs, pet
shop and grooming and spa.
• In 3 months to reach occupancy percentage of 60%.
• By year end FY 1 to have average occupancy 70%.
• Expansion of capacity by year end FY 5 with additional 30 lodges.
• Expansion of capacity by year end FY 10 with another 60 lodges in another

location.
• Franchise by year end FY 11.
Marketing Objectives:
• Assess market for dog hotels in or near Bucharest.
• Reach 4% share in target market in 3 months from opening.
• Reach 5% share in target market in 12 months from opening.
• Increase awareness and need in order to achieve 100% growth in 5 years,

and 200% in 10 years from opening.
4.3.SWOT
Strengths
• Our business know-how
• Our high communication skills
• Connections in dog owners community
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Weaknesses
• Lack of industry knowledge
• High cost structure
• Bank loan for initial investment
Opportunities
• Unfulfilled customer need - the market is in initial phase and will increase
• New ring and bridge will be built in Bucharest exit, before Buftea, which will
make access to our hotel easier and will drive real estate in this part of the
city
Threats
• Decrease of family budget percentage allocated for pet care due to financial
crisis
• Increase number of competitors
• Decreasing number of persons who will go out of city for vacation, weekends
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5. Strategy
5.1.Strategy framework
Our strategy is to differentiate our dog hotel via specialization. Our activity will be
concentrate on accommodation, day and overnight care and in this area we want to
be experts. Our regional competitors have like main activity other services (medical,
training, breeding) and are offering only additional boarding for pets. Most of them
are working with other categories of pets, too (cats, birds, reptiles) which have
different needs, programs. Our strategy is based on the following guidelines:
• Startup a dog hotel business in a location near Bucharest
• Services offered will be of high quality
• Target are high income dog lovers from Bucharest area
5.2.Mission
Our mission is to offer to dog owners who need from time to time to leave their pet
in a comfortable, safe place a with high care standards and reliable services
available anytime.
We will put all our knowledge and imagination at work in the benefit of the dogs,
offering them: spacious lodges, a generous playground, experienced dog-sitters,
medical surveillance, transportation, spa and grooming services to make dogs feel
like in a second home. We understand that our guests need human contact,
exercise and stimulation.
We value love for animals and genuine desire to make them feel as good as
possible.
Our main goal is to create a pool of faithful clients who will come back to our hotel
anytime they need.
5.3.Vision
We distinguish ourselves as the leader in redefining dog boarding business in
Romania, with the most complete dog care services.
5.4.Objectives
• Functional dog hotel in 12 months for 30 dogs, pet shop and grooming and
spa
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• In 3 months to reach occupancy percentage of 60%
• By year end FY 1 to have average occupancy 70%
• Expansion of capacity by year end FY 5 with additional 30 lodges
• Expansion of capacity by year end FY 10 with another 60 lodges capacity in

another location
• Franchise by year end FY 11
5.5.Competitive position
• Luxury hotel for dogs near Bucharest targeting the Bucharest region
• Main activity is accommodation for dogs while their owners are away in
vacation or business trips or at work
• Day care and overnight care services; daycare service being a novelty in
Romania
• Grooming and spa services for dogs
• Best conditions in the regional market: spacious lodges, generous

playground, professional care, medical surveillance
• Pick-up service: transportation from and to home
• Targeting “people like us” – middle class, workaholic, busy, who go out of
town during weekends and vacations and who also go a lot of business trips
5.6.Competitive advantage
• First dog spa facility in the region
• Daycare service
• Brand enforced by premium complementary services (spa, transportation,

web cameras)
• Trained staff
• 24x7 onsite services
5.7.Competitive tactic
• Leading edge of technology for materials, equipment and spa
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• Large playground area with swimming pool for dogs
• Specific trainings (such as First Aid) and visits to premium dog hotels abroad
• Personalized services to regular clients
5.8.Key Success Factors

• In this industry the love for animals is from where you start; is a must, but not
enough for being a successful pet hotel manager; dog owners are very
emotionally involved about their pet and they will feel if you really like dogs
• The second important key success factor is knowledge about pets (anatomy
and behavior)
• Superior customer service – 24 hour high quality care and service
• People skills are very important to keep in our hotel the staff and for relating
to customers; it is very important for them to know that they left their pet in
the care of a trustable, nice person
• Pet industry resources - is important to be updated with the newest and the
best products in the industry: pet food, vaccines, products for biological
safety
• Connections in dog owners community - knowing and being known by dog

owners, vet doctors, people from breeds associations can improve the word
of mouth about a pet hotel and help business
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6. Marketing
6.1.Segmentation, targeting, positioning
Segmentation
We consider potential market all persons who:
• Own a dog
• Live in Bucharest or in satellite municipalities
• Consider the dog like a member of the family and that dog’s needs and care
are important
• Have medium or high income
• Have long periods of absence from home (busy with their jobs, travel because
of business or for entertainment purposes)
Our most important group of customers are those who do not have as much time as
they desire to invest in their pets and are willing to seek additional help regardless
of costs.
In this pool of potential clients we identified 3 segments:
• Other brands loyal - persons who tried the services of the existing pet
boarding houses, were satisfied and comfortable with the offered conditions
and will not switch the company - this segment is made up from regular
customers (around 2,400) and some casual customers
• Other brands switchers - persons who were clients of the existing hotels, but
they are open to try another option - a small percentage of regular customers
and casual customers.
• Non-users of the service who could try the category via our services.
Because up to our calculations the number of customers that existing

accommodation facilities for dogs have is between five and six thousand, this first 2
segments have a low share in the total potential market. The third segment is
strongly represented; according to our understanding it is up to 20.000 persons and
is growing with 40% per year.
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Targeting
We decided to target the last two segments: other brands switchers and non-users
of pet hotels for over-night care.
Other brands switchers is a small segment of the potential market (up to 3.000
persons), but the good thing about this category is that they discovered the
appetite for using this service. They can choose our facility because of different
reasons:
• Convenience
• Better services
• Better image and reputation
• Additional services offered
• Novelty
• Trend
The challenging aspects of this segment are that they can be problem-customers
who can have false objections and the benchmark they will do with previous service
providers. Immediately after the opening we can have them like first target group.
The second segment is the pool of non-users, potential clients. For reaching this
segment and making them users of the service we have to invest in education and
advertising, but the potential of this segment is very big and they are very
important for our turn-over and future development.
For day-care, which is a new service in the industry, being the first on the regional
market who have this like a business objective, we have to educate potential clients
and create the need.
Positioning
We position our hotel as specialized for premium dog accommodation at a premium
price for overnight care and we intend to be the first who will focus on day care.
Picture of typical client: our clients are be “people like us”: dog lovers, middle class,
middle to high income, very busy, spending a lot of time at work and willingly to go
out of the city for weekends and vacations. This people are living in condominiums
or villas in the peripheral area of Bucharest or in suburbs. They use to make
shopping from supermarkets in the evening or in weekend. They are used to search
for information from internet and from colleagues and friends. They have a modern
life-style and they value the comfort and convenience. When making an acquisition
they are very discerning and demanding, but in meantime they are following trends.
No matter if they have family or they are single, they consider the dog a member of
the family and they are very emotionally involved about it; the same demands that
they have when they purchase a product or service for them have when they buy
something for the dog.
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6.2.Marketing Plan
When we drew our marketing plan we asked ourselves what’s most likely to attract
out target market to book in at our hotel.
Website
Today’s consumers expect any company to have a web presence and may even
decide not to do business with somebody who neglects this aspect. We consider the
website the most important tool of our marketing plan. A member of our team will
create and take care of it, because updating and adding to it all the time seems to
us equally important.
What to include - the focus of the site should be explaining the pet services we are
providing and the benefit of the pet and the client. Images with cute pets are the
standard of the industry.
Other items we need to include:
• prices and packages
• images of the facilities (lodges, play areas)
• pictures of the staff
• a picture gallery of dogs we cared for
• testimonials from clients
• FAQ
• Products available in pet shop
• Current promotions
• Registration form (PDF)
• Our policies
• Contact data
Our site address will be listed in all printed materials that we will have (business
forms, cards, brochures).
Search engine optimization is another concern for us. We will assure that our site
will show up when people will search for it.
Business cards
Business cards will be for start handed out to all potential clients and given to family
and friends to pass out. On business cards we will state the hotel name, phone
number, location, e-mail address and web site. On verso we will print a small map.
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The business being very personal, we consider that a photo of a nice dog head will
not be out of place.
Brochures
Brochures will be needed for mail-out, and can also be left with other pet services or
pet products providers. Because we will charge premium, the quality of the brochure
will match the price of our service. The purpose of the brochure is to pique interest
on the service and the facility.
Advertisement
Ads need to be designed to catch the clients’ attention and to pique their interest in
some way. We choose to have artwork on our hotel’s vehicle. We will have ad in
Yellow Pages. We will have coupons (printed by ourselves) in a very important
Romanian pet magazine: “Dog Magazine” after opening the facility.
Press release
We will have a press release at opening, another one before vacation season and
another when we will increase our capacity.
Donations and sponsorships

Because we will be premium dog hotel and we will offer additional luxury service
(like spa for dogs) we will find a champion dog in Bucharest and offering him free
accommodation and access to spa for life and in exchange we will ask owner to use
dog’s name and image. Connection of our hotel with the champion will be
mentioned in all our promotional materials (on site, brochures, and flyers).
Referrals and word of mouth

We consider referrals and word of mouth the main sources of new clients for our
hotel. There’s also a lot of benefit to remind past clients of our services just in case
that they will need it again. Here are some way to create word of mouth and
building relationship with clients or their business people.
From other businesses
Arranging partnerships with other businesses which reach out target market can be
very effective. We are thinking at vet offices, pet supply stores, pet shops, pet
sitters, dog walkers and trainers. These people are meeting with our target market
daily and are frequent in a position to refer our services to their clients, if they will
be convinced that we are offering good services.
We do not stop at pet businesses: other businesses which can be a rich source of
clients are travel agencies. We discussed with a travel agency which’s target are
people with high income and the sales director from the agency was very open to a
cooperation with us. They consider that having a connection with a trustable dog
hotel will improve the level of their offered services. For agency’s clients who are
living out of Bucharest and want to be clients of our hotel, we designed an
additional service: they will come to our location by car with the dog, they will leave
the dog in our facility and we will drive them to the airport and back with their car;
while they are in vacation their car will remain in our parking and when coming back
P a g e | 24|
they will take from us the dog and the car. In this way, we will not limit the
cooperation with agency to Bucharest area clients and they will have free parking
for vacation period.
In the end of the day, it’s important to say “thank you” to every business contact
that will refer clients to us for keeping the good relationships.
From satisfied clients
The best ways to generate word of mouth business from our clients is to do great
work and to offer exceptional services. We will make sure that our clients will be
100% satisfied, and we are sure that they will start telling people about us. To add
value to our services we intend to do some additional things like:
• sending newsletters
• sending e-mail on the pet’s birthday
• having webcams which clients can access online
• adding extra services free of charge or pet gifts for the ones who are coming
several times or for dog accommodation longer than 10 days
We are sure that all this small attentions will pleasantly surprise our customers and
make them the best promoters of our dog hotel.
6.3.Marketing Timing
Our long-run marketing strategy is a simple one: satisfied customers are our best
marketing tool. When a customer leaves our business with a happy pet knowing
that it has had a fulfilled day, our name and service will stand on its own.
But in the start-up period we will have to promote our service to as many targeted
persons as possible.
Our marketing timing is:
• 2 weeks before opening
○ Contact our future business partners for starting negotiations
○ Start spreading flyers to friends, relatives, colleagues to give them

further to dogs owners
○ Contact “Dog Magazine” staff to negotiate an add with coupons in

one of their issues
○ Get the list of registered dogs from “Bucharest Dog Association”
○ Website launch
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○ Dealers for toys, pet food
• Opening Month
○ Ad in “Dog Magazine”
○ Mail flyers to dog owners from the database
○ Flyers in business partners’ facilities
○ Press release
○ Contract with a champion dog’s owner
• Long term marketing activities
○ “Thank you” e-mail to every dog owner 2 days after check out
○ E-mail at dog’s birthday to every client
○ News-letters to every client 3 times per year ( before Easter

Holiday, beginning of June - before the summer holiday, and at the
end of November when everybody is preparing for Christmas
vacation)
6.4.Marketing Mix (The Five Ps of Marketing)

Product
The main service our small company will offer is accommodation for dogs.
Our hotel will lodge dogs for bigger period of time (overnight care service) or only
for the duration of the day (daycare service). Additional to this we have in offer
other services like: grooming and spa, training and transportation for dogs. All
services offered are premium, high quality, at the highest standards.
Comparing with other competitors who have pet accommodation like second
activity, our company will be focused on boarding services.
Our clients will leave their dog in a place which is offering safety, excellent
conditions for accommodation and daily activities, medical surveillance performed
by highly trained staff with a lot of love for animals.
Price
PetResort will be priced at the upper edge of what the market will bear, competing
with similar types of services in the area. For our luxury services we will charge
premium prices which will reflect our position on the market and the targeted
segment of clients. Comparing to other facilities that are offering “hotel” conditions
for pets, we have the same price level. Comparing to simple boarding houses or
kennels, our prices are a little bit higher.
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Accommodation services for pets are undeveloped, the industry being in

introductory phase and the offer is very low comparing to the potential market. The
prices our competitors have are not all the time in connection with the level of
services, conditions and facilities.
We strongly believe that targeted clients, people who are very emotionally involved
with their pets will find our offer very good from cost-efficiency point of view.
Taking into consideration the forecasted occupancy degree, will allow us to have
profit from the first year and to pay off our investment in five years.
Place
Because clients want to use an accommodation facility in the neighborhood, we
want to reach potential clients from Bucharest and surroundings.
Promotion
We will base our promotion on the conviction that in this business the best
promotion is word of mouth and referrals from satisfied clients. So, our main
promotion tool will be our focus to overpass expectations of all clients through
excellent services and dedication to owners’ and dogs’ satisfaction.
In the opening period we will try to get to as many possible potential clients. We will
mail flyers to potential clients; we will have flyers in the offices of business partners
(from pet services and from other industries).We will have an ad in a dog magazine
and a press release.
We will reinforce to existing clients our brand by sending news letters and e-mails
on dog’s birthdays.
For faithful clients, for persons who are bringing more dogs and for long-term stay
we will offer coupons or spa procedures for free.
People
In this business, employees are very important. We will have experienced persons,
highly trained for their jobs and with deep love for dogs. They will have complete
knowledge on what is expected from them, adequate tools and trainings to fulfill
their work, feel supported and respected by the management and staff, and they
will have fun at work and a pleasant atmosphere.
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7. Operations
7.1.Running PetResort
7.1.1.Setting up Space
To set up the pet hotel we need a number of subdivided workspaces: an area for our
staff to supervise group play a reception area to greet clients and accept payment,
area for pets to rest and sleep, and an office for filling paperwork and making phone
calls. We also need to equip these areas with the right equipment and supplies.
7.1.2.Areas Needed
PetResort has roomy, private spaces for each dog or cat to sleep in, a place for dogs
to play or exercise, a lobby for pick-up and drop-off, laundry room and office,
storage, and an area for employees to take a break.
For dogs we will require a rather large play area - the current industry
recommendations are anywhere from 15 to 35 square meters (for an average of 25)
per dog in our care, depending on the breed of dog. The play area is outdoors since
we have plenty of room and it also includes a pool for completing a safe-and-fun
area.
We are an all-suite dog boarding and doggy daycare. We have no cages and our
suites range from 2x2 to 2x3 meters with sofas and porcelain tile floors.
7.1.3.Layout and Design

Considering the flow of dog owners, personnel, and pets on our premises we came
up with the following layout which also takes into account the particularities of the
land.
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We also considered the landscaping, as seen in the following perspective:
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Not all our pet hotel suites are the same size. Also depicted below is the Office
Building:
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7.1.4.Special requirements
Our pet hotel features improvements to the ventilation and heating/cooling
systems, improved sound resistance, and of course, upgraded flooring. Tile is the
most suitable material for certain areas such as rest suites, which are also heated.
We also ventilate the building so that there is no offensive lingering pet odor and to
reduce airborne viruses, cool or heat it to a reasonable temperature as needed, and
provide natural or artificial lighting for pets and caretakers. This helps our pet hotel
to be germ and odor free. Most clients should notice that it smells really clean and
fresh. Air conditioning is crucial in summer months - even with the dog doors open
all day. And heated flooring is especially good in winter months, so the heat is down
at the dogs’ level.
Outdoors, we build a fence to keep dogs of all sizes secure. This means taking a
look at where little dogs could squeeze out, where diggers could tunnel out, and
where jumpers could make it up and over. We plan to replace our grass regularly, or
look at an alternate outdoor groundcover solution.
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In terms of security, all our doors will be alarmed, and the hallways are monitored at
night, so if a dog gets out or a person breaks in, the system calls manager’s phone
and then the police department. Same for smoke detection monitors - it calls
managers phone, and then immediately the fire department.
7.2.Equipment and Supplies
7.2.1.For the Pet Hotel

Pet Hotel Checklist
• Brushes and combs
• Crates and accessories
• Collars and leashes
• Cleaning supplies (animal-safe) and equipment
• Dog-safe fencing
• Drinking water
• First aid kits (human and pet)
• Flooring (paw-friendly and easy-to-clean)
• Food and water dishes
• Play equipment (slides, pools, etc.)
• Pet beds
• Pet carriers for emergency vet trips
• Pet furniture
• Pet linen
• Pet food
• Registration forms & release
• Rubber gloves
• Storage bins
• Spray bottles
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• Soundproofing material
• Throw blankets
• Treats or toys
• Uniform (pet-hair resistant)
• Webcam
Dog Walking Checklist

• Bottled water and a few snacks
• Bug spray
• Collar and leash
• Disposable raincoat
• Gloves for cold weather
• Hat and sunglasses
• Ice walking shoe attachments
• Poop disposal bags
• Portable dog water
• Sunscreen
Obedience Training Checklist

• Agility equipment
• Clicker
• Collars
• Feedback forms / Report cards
• Harnesses
• Leads
• Muzzles
• Retrieval items
• Treats / rewards
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Spa/Grooming Checklist
• Animal handler gloves
• Bows and bandanas
• Brushes
• Combs
• Conditioners
• Dental care supplies
• De-tanglers and odor handlers
• Drain hair catcher
• Ear cotton
• Ear grooming tools and supplies
• Matt splitters
• Nail trimmers
• Scissors/shears
• Shampoos
• Skin care products
• Styptic powder
• Tool caddy or storage
• Towels
7.2.2.For The Office

As a pet hotel business we need an office to keep records and client information up
to date. It's important to be able to answer phone calls from clients there.
Answering calls while the dogs are barking may make our pet hotel sound
unprofessional. Therefore we take calls somewhere away from the action.
Our office has a desk where we can write or use a computer, a comfortable chair, a
telephone, and adequate lighting. Our reception area includes:
• Artwork
• Calculator
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• Calendar
• Chairs for guests
• Computer
• Debit/credit machine
• Fax machine
• Filing cabinet
• Garbage and recycling bins
• Printer & cartridges
• Reference books on pet breeds and behavior, and pet health
• Storage bins or cabinet
In terms of office tools and supplies we consider:
• Agenda or electronic organizer
• Business cards
• Cell phone
• Digital camera
• Envelopes (various sizes)
• Paper, pens/pencils, paper clips, notepads, etc.
• Promotional materials
• Software
• Stamps
• Stationery (letterhead, client forms, etc.)
7.3.Selling Pet Supplies

Who doesn't feel like their pet deserves a treat for being so good while "mommy" or
"daddy" was away? We also sell pet products and supplies to our clients as a way to
improve margin and revenue, and give better service to our clients. Some products
we sell include the following:
• Beds
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• Brushes and combs
• Carriers
• Collars and charms
• Costumes
• Jewelry and tiaras
• Pet cologne
• Pet food
• Pet toothbrushes and toothpaste
• Shampoos and detangles
• Sweaters
• Treats
• Toys
Pet supplies are purchased from distributors, who sell them to our pet hotel at a
price that is typically half of the retail store price.
We also seek out local artisans or small businesses who can supply us with unique
pet items at a low price. In order to reduce the upfront cost we try to get these
businesses to sell through our hotel on consignment - this way we only pay them for
what sells.
Pet suppliers are recommended by pet industry experts, we will likely develop a
relationship with a few that meet our needs the best. We'll save on shipping costs if
we can find a supplier that is dose to us. We can also attend industry tradeshows to
meet suppliers (who will have booths there), or ask our fellow pet business owners
via an online message board community.
7.4.Setting our Fees

What we will charge clients will be based on our local market and economy, what
other pet hotel businesses are charging, and the quality and type of service that we
offer. Please see below our fee schedule:
Daycare 70 RON
Overnight care 100 RON
With own food 5 RON reduction
After a stay of 7 days a daily discount of 10 RON
After a stay of 14 days a daily discount of 15 RON
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Special food, medical care 1 RON for each application

Obedience training 20 RON individual training
Price Reduction Schedule
30% For the 2nd guest dog of an owner

10% For a time period of minimum of 8 days in the period of November to
March outside holiday seasons
10% For a time period of minimum of 30 days
5% Early reservation (minimum 2 month before arrival and immediate
money transfer)
7.5.Factors that Affect Our Fees

To set our fees, we wanted to start by taking a look at what other pet hotels charge.
But it's not as simple as making our fees the same too. While charging the same as
other overnight or long-term pet care providers makes sense on the surface, it
doesn't factor in how our business may be different. For example, we have a little
more overhead, target a wealthier clientele, have more specialized services, and
last but not least may have different profit goals than our competitors.
We think the first place to start when determining our fees is our competition, but
we also feel strongly that perception is reality sometimes a higher price (within
reason) equals higher quality in the eyes of a customer.
7.6.Policies and Payment

As much as working with pets for a living is its own reward, we still enjoy getting
paid by our clients. At pet hotels, payment for service is required either in advance
of the service, or at the time service is rendered. We don't want to get into billing
clients after the fact, as this is time-consuming and doesn't always result in getting
paid. It's best to be up front with our clients about all our business policies,
including our payment policy.
Setting Policies
We conduct an initial meeting with owner and pet to get the background
information needed to properly care for and supervise the pet. Policies and points to
cover include:
• Pick up and drop off procedure and times
• What will take place in an emergency or natural disaster
• What vaccinations are required for group play
• What types of collars are acceptable

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• Reasons a pet may be refused or terminated from care
• How dogs will be disciplined
• What holidays the hotel is closed
• Late pick-up policy and fees
• Communication policies (web cams, report cards, activity reporting)
• Payment Options
• At busy times of the year such as holidays, we encourage our clients to book
early and reserve a spot. Reservations can be paid in full, or we can take a
deposit.
7.7.Day-to-Day Operations
This section deals with the day-to-day parts of running PetResort such as scheduling
clients, hiring staff, and cleaning and maintaining our hotel.
7.7.1.Scheduling
Although we may prefer the hands-on time with pets, part of our job will be time
management. This starts by setting our pet hotel pick up and drop off hours. In
general, our hours have to match the needs of our clients. We start with 8AM to 8PM
for pick-up and drop-off and plan to improve if needed. Reception is not open on
Sundays.
We use software to keep track of the pets coming and going each day. This will also
help keep us sane during our busiest times, when we and/ or our employees may be
seeing many pets a day.
7.7.2.Hiring and Managing Staff

Getting Ready to Hire
When we will build our pet hotel, we will put a "now hiring" sign in the window
displaying a number to contact us at while construction is taking place. This will
hopefully save us some of the costs of help wanted advertising in the newspaper,
which can be hundreds of lei per add. Positions to hire:
• Dog trainer
• Dog supervisor
• Janitor
We will get vets and groomers come in to our premises as contractors.

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We should also check backgrounds of potential employees, and driving records of

anyone who will drive on our company's behalf.
Keeping Employees Happy

In an industry that is infamous for turnover, we should do whatever you can to help
our pet hotel retain employees. There's no single magic way to prevent turnover,
but as smart owners and managers we should figure out ways to keep people happy
to call our business their place of work.
To begin, we will set a salary that is competitive with what others in the industry are
offering. Obviously if we will be able to afford to pay higher than others, that will
help us attract and retain employees. We will not overlook the value of perks, as
well as health care, planned raises, paid vacations and Christmas bonuses to help
us keep people around.
In general, we believe employees are happiest when they:
• Know what is expected of them. We will create an employee manual that

details our policies and procedures. We should also prepare a job description
that lets each employee know what is required for the position. Review these
descriptions at least annually. If responsibilities have changed, add or remove
them (in writing) for our employees. Employees will also need to report to us
on any incidents involving pets in their care, such as dog fights or injuries.
• Have the tools to do their job. We will make sure that the equipment in our
pet hotel works well, and is maintained on a regular basis. We will create a
repair and maintenance manual that lists equipment and annual service
schedules. Stock the supplies our staff will need on a daily basis, and monitor
inventory levels.
• Feel adequately trained to do their job. Paying for our staff to take outside
training courses like pet first aid, or attend a conference on pet care issues
will help them do their job better and with more confidence. We may also find
that refreshing or adding new skills will help long-term employees find new
motivation and enthusiasm for their work.
• Feel respected. We will try to create an environment where staff members

feel like they can speak to you openly. A weekly or monthly meeting can
foster an environment of good communication.
• Feel like their work in a day matters. Thank staff members when they do an
exceptional job, or even just for regularly doing their best. It's also important
to share positive and negative client feedback with our staff members, and
ask staff for their input when we make business decisions that will affect
them. Let staff know a bit about how the business is doing overall.
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• Feel supported by management and staff. Encourage our staff members to

act like a team. Don't allow gossip at work, and if a conflict between staff
members occurs, get all the information we can before deciding what needs
to be done to resolve it.
• Have fun at work. Celebrate staff birthdays or other events, bring in coffee
and snacks for no reason. Take the time to learn staff spouses' or children's
names, and share a bit about our own interests and hobbies with them.
7.7.3.Hygiene, Health and Safety

Having safe hygiene, health and safety practices in place at our pet hotel is
paramount. Here are some strategies to keep us, our staff and our workplace clean
and safe.
Cleaning Routine
A daily cleaning routine is a must. The cleaning products we will use should be
appropriate for pet care businesses. Bedding, suites, crates, toys, play space need
to be cleaned and disinfected before being used by another animal.
Floors need to be finished with a material that is easy to clean, and then cleaned
and disinfected often. We will use a special biological safety product called Ecocide
S.
The one piece of equipment we use daily is our cleaner machine, is what we use to
disinfect the rooms every day and clean with.
Having a cleaning schedule where tasks are checked off as they are completed will
go a long way to making sure nothing gets missed. Daily and weekly duties should
be included and divided fairly among staff members.
Caregiver Safety
Our safety and the safety of our staff are just as important as the safety of the
animals. Dog bites and scratches will always be a concern. If we feel after meeting
any pet that they are too aggressive for us or our staff to handle, it's better for us to
decline to take them in. Our safety has to be a top priority in this business.
We will take down a complete pet information history before our staff will be
exposed to any animal, and use gloves or muzzles as necessary. If a pet has sore
spots or behavioral triggers that are likely to set him or her off, make sure that
information gets communicated to everyone who will have contact with that pet. If a
dog bite does occur, we will report it to local health or animal control authorities.
There are some diseases that can be transmitted from animal to human. Of course
fleas and ticks aren't picky who they munch on, and rabies is an obvious one.
Mange and ringworm can be transmitted from pet to pet via our grooming
equipment. A strict cleaning and disinfecting regimen will help prevent the
transmission of illness and disease.
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And although it may seem like a minor matter, staff members with severe allergies
to dust or pollen (or obviously, pet dander) may not be able to work comfortably
with pets, in particular if the pet goes outside often.
Pet Health and First-Aid

We and our staff will always be on the lookout for signs that a pet isn't well. This is
easier the better we know a pet, but with more experience and training we will
come to recognize the classic symptoms, such as lethargy, vomiting, and signs of
dehydration. We will take courses in pet first aid that our staff could benefit from.
If we determine that a pet in our care needs to see a vet, will need to contact the
owner immediately, as well as provide transportation to the vet's office. If seeking
vet care will leave our facility short staffed, it might be better to call a mobile vet
instead.
We get owners of pets placed in our care to sign what's called a vet release. This
paper authorizes us to take their pet to the vet if we deem it medically necessary,
and stipulates that the owner will be responsible for any fees incurred. The release
also specifies an amount of emergency treatment we are authorized to request
without further instruction from the owner.
Handling Client Complaints

When you work with the public, complaints from clients are an inevitable part of
doing business. It's never fun dealing with them, but if handled professionally, there
is usually no long-term harm done. Handled unprofessionally, complaints can do
serious damage to our business' reputation, and if they become public, can even
put us out of business permanently.
First and most importantly, no complaint should ever be ignored or not followed up
on. It's well known that dissatisfied customers will tell far more people about their
negative experiences than they talk about their positive ones. This is not the kind of
word-of-mouth we want working for (or in this case, against) us.
It's best that we as the owner be available personally to handle complaints. If we

were not in the pet hotel when the incident occurred, we can follow up with a phone
call later.
7.7.4.Pet Hotel Registration Form
Today's Date:
Client Information
Owner First and Last Name:
Address:
City:
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Phone:
Cell or alternate phone:
Email:
Emergency Contact Info (friend or family):
Alternate person who may pick up pet from hotel:
Special Password:
Pet Information
Name:
Age & Birth Date:
Breed:
Weight:
Male or Female:
Check one: Spayed Neutered Unaltered
Valid Tag or License #:
Microchip or Tattoo Number:
Pet Health
Pet has received up-to-date immunizations "Please attach a photocopy of

immunization record “
Yes
No If no, explain:
Name and phone number of vet:
Clinic Name:
Medical Conditions:
Allergies:
Has had flea/tick prevention: Yes No
Has had heartworm prevention: Yes No
Physical Limitations (sore back, hip dysplasia, etc.):
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Insured? __ Name of Company:
Pet Background
Previous training:
Previous hotel stays (Y/N):
If dog, is he/she crate-trained?
Does pet enjoy grooming? __ Any sensitive spots?
How long have you owned this pet?
How does your pet generally react to other animals?
Pet is afraid of:
Pet's preferred reward:
Favorite toys:
Favorite games:
Other notes:
--------------------
Pet Behavioral Challenges (check all that apply):
Biting, hissing or growling at people (explain reasons)
Aggressiveness with other animals (explain reasons)
Shyness
Jumping on people
Jumping over fences
Chewing or digging
Chasing small animals
Escaping out an open door
Excessive pulling on leash
Pulling out of leash
Running away
Other
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Feeding
Current feeding schedule:
Feeding instructions (time, amount):
Preferred brand: Treats okay? Yes No
Any brand of food/treat pet may not have?
Guest Stay Dates
Monday All Day am/pm am/pm
Tuesday All Day am/pm am/pm
Wednesday All Day am/pm am/pm
Thursday All Day am/pm am/pm
Friday All Day am/pm am/pm
Saturday All Day am/pm am/pm
Sunday All Day am/pm am/pm
Start Date:
End Date:
Payment
Cost per day: Cost per week
Pre-purchase Payment Received:
Future payment arrangements:
I have read and understood the liability waiver and release form.
Client signature: Date
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8. Financials
Year 2010
• 3 owners / investors; 2 bring 210,000 RON each, 1 brings land evaluated at
210,000 RON, for a total of 630,000 RON
• Capital is invested in buildings and landscaping which is scheduled for being

functional in 2011
• After 6 months we get a bank loan of 300,000 RON which will be used for
continuing construction and ensuring cash flow for the first months of
operation. Interest rate plus all bank charges amounts to 15.62% per annum.
We also get a grace period of 6 months (until operation starts) during which
we only pay interest. After that, we return principal and interest in 5 yearly
installments, at the end of each period.
• During this year we only consider marketing and interest expenses
• We consider, according to current legislation, we have to pay “Poll tax” -

“Impozit forfetar”
• Depreciation is considered linear and according to terms specified in

Romanian legislation
• Inflation has not been taken into account
• We considered maximum occupancy rate cannot be more 80%
• Since in this industry it is not customary to have delayed payment terms for
both clients and suppliers we consider costs and revenue paid and collected
during the analyzed period
Year 2011
• Operation start
• We assume an average of 450 occupied days per month (50% occupancy)
• Revenue considers 50% occupancy with an average price of 84 RON / day
• Costs are presented in Appendix 3 – Cost Model Overview
• 50,000 RON worth of dividends are paid
Year 2012
• Revenue is considered on an average of 20 dogs / day which equals an
occupation rate of 67% and an average price of 84 RON / day
• In order to accommodate business growth the following items are purchased:
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○ Toys, Accessories – 3,000 RON

○ PC – 1,000 RON
○ Tools – 2,000 RON
• A second car is leased, at the same cost as the first one
• Extra contractor work is needed which increases labor costs by 20%
• Other expenses increase also by 10%
• 150,000 RON in dividends are paid
Year 2013
• Revenue is considered on an average of 22 dogs / day which equals an
occupation rate of 73% and an average price of 84 RON / day nu se mai
investest in minic
• Extra contractor work is needed which increases labor costs by 10%
• Extra cash is invested into short term deposits
• 200,000 RON in dividends are paid
Years 2014 – 2015

• Some investments into maintenance and landscaping
• Following the same forecasts we had for 2013 the initial investment will be
returned in a maximum of 3 years, at an IRR of 13%
2010 2011 2012 2013 2014 2015 2016

NPV -630,000 50,000 150,000 200,000 200,000 200,000 200,000 1,513.98
IRR 12.88%
Cash Flow
Direct cash flow 2010 2011 2012 2013

Cash in from operations 0 453,600 604,800 665,280
-231,48
Cash out for operations - Fix -63,300 -159,492 -219,072 7
-106,02
Cash out for operations - Variable 0 -72,293 -96,390 9
Cash Flow from Operations -63,300 221,815 289,338 327,764
Investments 420,000 0 0 0
Machinery / Equipment -34,500 0 -6,000 0
Vehicles 0 0 0 0
Land & Buildings -577,500 0 0 0
Intangible Assets -2,000 0 0 0
Cash Flow from Investing -194,000 0 -6,000 0
Loan taken up / interest received 300,000 0 0 0
P a g e | 46|
Installment payment 0 -60,000 -60,000 -60,000

Interest -23,430 -46,860 -37,488 -28,116
Bank charges -1,000 -2,000 -2,000 -2,500
-200,00
Dividends 0 -50,000 -150,000 0
-290,61
Cash Flow from Financing 275,570 -158,860 -249,488 6
Taxes -2,200 -17,073 -19,056 -21,624

Liquid Assets Beginning of the Period 0 16,070 61,952 76,746
Liquid Assets End of the Period 16,070 61,952 76,746 92,270
Profit and Loss
2010 2011 2012 2013
Net inconme 0 453,600 604,800 665,280

Material costs-variable costs 0 72,293 96,390 106,029
Gross profit 0 381,308 508,410 559,251
Bank charges 1,000 2,000 2,000 2,500

Utilities 0 9,000 9,000 9,000
Selling - promo 5,400 5,400 5,400 5,400
Salaries 0 98,784 142,249 156,474
Other operating expenses 0 38,714 54,069 50,588
Depreciation / Amortization 11,667 35,000 37,000 37,000
Operating expenses- fix cost 18,067 188,898 249,718 260,962
Interests 23,430 46,860 37,488 28,116

Extraordinary expenses 7,595 7,595 8,354 10,025
Non operating expenses 31,025 54,455 45,842 38,141
Net profit before taxes -49,092 137,955 212,850 260,148
Taxes 2,200 17,073 19,056 21,624
Net profit after Taxes -51,292 120,882 193,794 238,524
EBITDA -13,995 180,550 258,204 307,173
Break Even Analysis

We consider the Initial investment, Fixed Costs, and Variable costs for the first 5
years of operation, plus year zero (setup, construction).
Initial Investment 720,000 2010

Fixed Expenses 159,492 2011
P a g e | 47|
219,072 2012
231,487 2013
231,487 2014
231,487 2015
Interest 24,430 2010
48,860 2011
39,488 2012
30,616 2013
21,244 2014
11,872 2015
1,969,5
Fixed Expenses for 6 years 35
Variable Expenses 13.4
Based on the above we compute a number of 27,897 days of occupancy, resulting

in an average occupancy rate of 52% over the 5 years of operation.
P a g e | 48|
9. Future Developments
Aside from continuing expanding and franchising the business in year 11, we also
considered entering the pet hotel business for other kinds of pets, such as cats,
birds, and even more exotic pets such as snakes, lizards, spiders.
Another area we believe is worth exploring is a lateral mapping toward producing

our own brand of pet food which would be fed to the pets during their stay and
would also be sold to pet owners in our pet shop.
The long stay parking service which we offer as a perk to our guests’ travelling
owners may become increasingly popular and we may consider turning this into an
associated revenue stream based on travelers who do not necessarily leave their
pet in our care.
P a g e | 49|
Bibliography
1. Jennifer James- FabJob Guide To Become a Pet Hotel Owner

2. www.bplans.com
3. www.entreprisescanada.ca/gol/bsa/site.nsf/en/index.html
4. canadabusiness.gc.ca/servlet/ContentServer?pagename=CBSC_ON/display&c
=GuideFactSheet&cid=1081945275379&lang=en
5. www.ideideafaceri.ro
6. www.inns.ro
7. standard.money.ro/articol_20722/piata_de_pet_food_a_crescut_de_zece_ori_in
_ultimii_sapte_ani.html
8. www.zf.ro/companii/nordic-petfood-vrea-sa-castige-jumatate-din-volumul-
pietei-de-hrana-pentru-animale-in-urmatorii-doi-ani-3344227
9. www.zf.ro/afaceri-de-la-zero/in-jurul-acestor-caini-si-pisici-graviteaza-o-
intreaga-industrie-3015265
10.www.revista-piata.ro/articole/analize--tendinte/animalele-romanilor-au-prins-
gustul-specialitatilor.html
11.www.muzohotel.com
12.www.dogdaycare.com
13.www.paws-inn.com
14.www.bellotel-sudwalde.de
15.www.care-royal.de
16.www.hundehotel-satke.de
17.www.dresaj.ro
18.www.aldovet.lx.ro
19.zoopensiune.sunphoto.ro
20.www.k9studio.ro
21.www.pisicilearistocrate.ro
22.www.salvanim.ro
23.www.marcovet.ro
24.www.taras.ro/pensiune.php
25.www.pensiuneacanina.ro
26.www.canisresort.com
27.petshotel.petsmart.com/
28.www.dacia.ro
P a g e | 50|
Appendix 1 – Car Lease
P a g e | 51|
Appendix B – Premises
P a g e | 52|
P a g e | 53|
P a g e | 54|
P a g e | 55|
P a g e | 56|
Appendix 3 – Cost Model Overview
Initial investments RON Ongoing costs (per month)

210,0 RO Variabl RO
Land 00 Fixed N e N
21,00
Utilities 0 Water 500 Water 50
63,00 Electrici
Building offices 0 Electricity 150 ty 50
378,0
Building dog houses 00 Gas 0 Gas 0
52,50
Building pond 0 Phone 100 Phone 20
Incorporation, Operation
Permit 2,000 Vet 0 Vet 5
Toys, Accessories 6,000 Internet 50
PC 2,000 Website 0
Phone 1,000 Flyers 400
4,93
Tools (Gardening, etc) 5,000 Dog Trainer 9
3,29
A/C 8,000 Dog Helper 3
Janitor / 1,64
Fridge + Electric stove 4,500 Maintenance 6
Car operational
Washer & Drier 3,000 lease 680
Furniture 5,000 Fuel 400 Fuel 80
Dog
Car lease down payment 6,964 Dog food 0 Food 50
HR 0 Other 500
Website 0 Risk 633 Risk 13
10,00
Other 0
38,89
Risk 8
P a g e | 57|
Appendix 4 – Who we are
Marketing Superstar – Madalina Lupica Operations Superstar – Gabriel

Vlad
P&L Superstar – Bogdan Chirila
P a g e | 58|
P a g e | 59|
Special Guest Finance Superstar – Simona Miklos
Special Guest Architectural Design Superstar – Anton “Toni” Budileanu
P a g e | 60|

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BSM-MBA Romanian-Canadian MBA program – Graduation Project

“PetResort” - Pet Hotel Startup

5.2. Mission............................................................................................. .......3

Getting Ready to Hire............................................................................... .....3

Location and facilities

Other services provided by PetResort include:

• Transportation of dogs to and from the hotel, which is provided free of

• Grooming services such as nail trimming, brushing, cleaning and bathing.

• Obedience training. Basic obedience training is focused on teaching a dog

Key Financial Indicators

Ownership & Management

Location and facilities

The location is in Buftea, a rapidly developing area near Bucharest.

Other services provided by PetResort include:

• Transportation of dogs to and from the hotel, which is provided free of

• Grooming services such as nail trimming, brushing, cleaning and bathing.

• Obedience training. Basic obedience training is focused on teaching a dog

4.1.1.External environmental analysis

4.1.2.External situation analysis

• Strategic groups – Based on Price and Location as criteria:

Country Bucharest and surroundings Location

• Industry life cycle – in Bucharest we found around 15 boarding houses for

• Porter’s five forces

Internal competitive rivalry

○ Intermittent overcapacity – even in periods of the year when pet hotels

○ Product differences – existing pet accommodation facilities in

○ Switching costs – the alternative for leaving the pet in a kennel is to

○ Informational complexity – for a pet owner the information delivered by

○ Corporate stakes – because the small number of firms in the industry

○ Exit barriers – are low because accommodation facilities can be used

Bargaining power of buyers

Bargaining power of suppliers

• Market growth rate - taking into consideration that existing kennels in

• Market concentration - because the number of lodges/hotel is quite low

• Penetration - Considering there is no statistical data on this market we had to

○ 60-70% of occupancy is coming from regulars. They are likely to use

○ The rest of occupancy during peak months is coming from

○ We have computed a target market of 20-25 thousands and a

Our competitors’ strengths are:

• Previous experience in working with pets (like breeders or doctors or trainers)

• Connections with pets owners society

• Related services which they offer

• Accommodation organized in apartments (less place to play for dogs, many

• Weak marketing (poor websites or no website, hard to find on internet,

• No clear positioning regarding target, price policy, additional offers

• Services offered (existing playground, separate lodges, medical surveillance)

• Distance from home

The sources of information for pet boarding service are:

• Friends, relatives and other pet owners

• Advertising made on pet shops, vet clinics etc.

4.2.Internal Situation Analysis

• In 3 months to reach occupancy percentage of 60%.

• By year end FY 1 to have average occupancy 70%.

• Expansion of capacity by year end FY 5 with additional 30 lodges.

• Expansion of capacity by year end FY 10 with another 60 lodges in another

• Franchise by year end FY 11.

• Assess market for dog hotels in or near Bucharest.

• Reach 4% share in target market in 3 months from opening.

• Reach 5% share in target market in 12 months from opening.

• Increase awareness and need in order to achieve 100% growth in 5 years,

• Our high communication skills

• Connections in dog owners community

• High cost structure

• Bank loan for initial investment