SIMIATUG-TOURISM, Simiatug, province Bolívar in Ecuador

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Tourism Industry

Business Plan for

The Villages of the Region Simiatug Saludos desde Simiatug Greetings from Simiatug Grüße aus Simiatug

“Welcome to El Cielo en la Tierra” ‘Heaven on Earth’ ASOPRICELAT, Aso de Producción, Industrialización y Comercialización EL CIELO EN LA TIERRA, Simiatug, Ecuador T: 593-(0)98 589 1577 E: simiatugllakta.bolivar@gmail.com

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I.

Table of Contents

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Table of Contents

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II.

Executive Summary

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III.

Company Outline & General Description

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Mission Statement. Vision Statement. Market. Industry. Key Elements of Success.

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V.

Products and Services

Marketing Plan (Overview)

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Economics. Product Features & Benefits. Our Visitors. Competition. Niche. Strategy.

VI.

Operational Plan

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Production. Location. Legal. Personnel. Inventory. Suppliers. Accounts Receivable.

VII Leadership and Organisation

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Leadership. Leadership Team. Professional and Advisory Support.

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Financial Plan

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Profit/Loss Projections. Cash Flow. Balance Sheet. Break-even Analysis.

Appendix #1:

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Hostal, Operadora de Turismo-Communitario y Centro de Entrenamiento 'Simiatug Llakta', 200m2, en Simiatug-Pueblo, prov. BolĂ­var, Ecuador.

Appendix II:

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Inversiones de Hacerse en Construcciones para Hospedar a Turistas y Asesores en las CommunidadesTurcom de Simiatug.

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II.

Executive Summary

Simiatug is located in the high Andes, in the Cordillera Occidental, province of Bolívar, in Ecuador. It is a region of more than 90 square kilometres in size, at altitudes that range from 4,350 metres in the east to 2,000 metres in the west. ‘Simiatug’ is the name of the territory, and the name of the Parish centre. The four mountain villages that have banded together with Simiatug for this tourism initiative are Cocha Colorada, Pambucloma, Santa Teresa and Cutahua.

We, the people of the villages of the Region-Simiatug, are a rural, mountain dwelling people, dependent on our natural environment, farming and our craft works for most of our subsistence needs. Our relationship with the natural environment is a complex one, rooted in our history, our mythologies and an ancient culture. We have arrived in the present day after some five hundred years of contact with the outside world—at a time when all peoples are aware of the ecological dangers of the resource consumption characteristic of western civilisation. In market-economy terms however, our desire to protect the natural capital of our environment is limited by a lack of resources. To combat these restriction we have developed, and continue to develop, collegial relationships and partnerships with communities across the surrounding region in order to develop internationally collaborative initiatives to ensure our resources are exploited in sustainable ways.

The most significant of these lie in our efforts to benefit from our natural resources by developing an eco-tourism sector that is community-based, and will thus be of benefit to all the peoples who live and work here.

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III.

Company Outline & General Description

Mission Statement Through the company ASOPRICELAT we are a community-based eco-tourism experience in the Andes Mountains of Ecuador. We are committed to providing safe, comfortable and hospitable services to our guests—and to sharing our knowledge of the magic of the mountains, our culture, and way of life.

Vision Statement We own and manage a community-based eco-tourism business that constructively utilises our cultural traditions and natural resources in socially appropriate ways. We provide opportunities for our people through research, training and employment. We work with our partners to enhance mutual respect and benefits.

Market We offer the craft goods made by our indigenous peoples, and our services, to a world-wide market that is interested in a unique experience with people of an ancient culture who live in an environment filled with natural wonders. By coming here our guests support community-based businesses that are owned and operated by local, indigenous people. By coming here our guests help to fund and support activities that sustain our natural resources and human cultures. Our tourism market is focused primarily on themes of eco-tourism.

Eco-tourism is a growth industry. Our market is interested in places and experiences that are off the beaten tourist track. Market research shows that: 

Most of our visitors are seeking a ‘learning-centred’ experience. In other words the purpose of their visits is usually not just experiential, but educational.

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Up to 60% of our guests will be women.

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Our product holds great potential for repeat visits from our guests. The mountain villages of Ecuador’s Cordillera Occidental also holds strong potential interest for North American and European post-secondary institutions—particularly in subject areas like geology, zoology, ornithology, entomology, biology and plant biology—which may include natural

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medicine—ethnography, anthropology and indigenous cultural studies, environmental studies, and other related areas.

Among its many attributes, Ecuador—through the country’s 2008 Constitution—is the first country in the world to recognise legally enforceable Rights of Nature, or ecosystem rights. This designation recognises the importance and inviolability of Ecuador’s community-centric, ecologically-balanced, culturally-sensitive society. (These Rights are backed by tradition, and— importantly in today’s world—carry legal and political authority.)

This alone makes Ecuador an international destination of great interest to identifiable visitor market groupings from the Americas and overseas.

Because of the cooperative relationship that we have developed with our neighbours and colleagues—particularly among the villages of Cocha Colorada, Cutahua, Pambucloma and Santa Teresa—we are well positioned to accept and share the growth forecast for the coming years.

Industry Eco-tourism is a growth industry in Ecuador. The World Bank reported that the tourism benefit to Ecuador’s economy in 2016 was US $1.034—an increase of more than 4% from the previous year.

All aspects of the industry are supported by the government through Ecuador’s Ministerio de Turismo. Statistics to date for 2018 show that Ecuador’s second most important tourist market is the United States, with almost 300,000 visitors this year—and you will see elsewhere in this document that there are direct air carrier routes from the US into Quito, the main international airport for the Region Simiatug. This degree of growth outpaces the growth attributed to tourists from many of our closer neighbours such as Colombia, Peru, Chile, Argentina and Mexico, and bodes well for the future. As well, an increasing number of people from the United States and Canada have taken up residency in Ecuador, thus stimulating regular visits from family and friends. The statistical charts in the Ministry of Tourism overview gives excellent analyses of the growth trends for the tourism industry in Ecuador over the past decade or so. Our own research has enabled us to target specific visitor markets that are tailored to the ‘products’ and services we have in the Region Simiatug. See http://servicios.turismo.gob.ec/index.php/anuario-deestadisticas-turisticas for Ecuador’s Ministerio de Turismo charts and statistics.

The organisation El Cielo en la Tierra has been in existence for 8 years. During that time it has grown organically through the efforts of the people of the Four Villages. Now, we are close to being able to respond to international interest in a region of unique attributes, and a natural, organic

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way of life. Our visitors do not wish to see a place of homogenised hotels, foods and sightseeing opportunities. They want to experience the last vestiges of an ancient and fulfilling way of life, and meet our extraordinary native peoples—who are intelligent, resourceful, and tough, and speak Spanish and Kichwa—a language that derives from the language of the Incas. When they come here these guests will have a key to the door that opens the treasures of our region. At the same time, the Centre and Eco-Lodge we wish to build for Region-Simiatug will grow carefully and profitably over the foreseeable future. Most important of all, our Centre and associated tourism enterprises will remain consistently sensitive to the precious culture and the way of life of the people of this area.

Our challenge is thus to balance the growing interest in our region with what is inevitably a fragile ecosystem that is central to our way of life. We are prepared, and able, to do this.

Company strengths and core competencies El Cielo en la Tierra is led by an outstanding leadership team, and supported by the whole community—farmers, craft makers, teachers, guides. Through the visionary leadership of Sra. Cornelia Kammermann, allied to the knowledge and expertise of our people, El Cielo en la Tierra has grown from a concept to its current position in just a dozen years. Our operations team of Manuel Talahua, Hugo Redrobán, Juan Chulco and Raúl Punina are leaders in the respective communities of Cocha Colorada, Santa Teresa, Pambucloma and Cutahua. As well, our organisation can call upon support and advice from the Department of Global Leadership at Royal Roads University, Victoria, British Columbia, Canada – and from Michael Elcock, a former tourism industry executive with wide-ranging international experience in tourism, and a specialisation in remote areas and adventure tourism.

Simiatug, and the Four Villages of Cocha Colorada, Cutahua, Santa Teresa and Pambucloma are located in extravagantly beautiful surroundings among the mountains of the Cordillera Occidental, 90 minutes by car to the west of the city of Ambato. Lush mountain valleys and enchanting peaks, home to many different species of birds and a range of domestic and wild creatures, lie all around.

Our core competencies lie in the skills, knowledge and dedication of our people. Our guides are second to none; men and women who are familiar with the diverse flora and fauna of the region because they have spent a lifetime living and working in the mountains and high valleys. Most of them are also musicians and storytellers, with great stores of knowledge about the history, legends

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and mythologies of this area. Our farmers and crafts-people have unique skills, and produce goods that are in demand, and which already sell widely in Europe.

Key Elements of Success a)

Strategic partnerships with tour operators

At El Cielo en la Tierra we are developing a number of important strategic relationships in order to develop a core of professionalism. One of these is with senior personnel at the School of Global Leadership at Royal Roads University in British Columbia, Canada. Several people from that programme have already visited Simiatug. Another important relationship is with CESO (Canadian Executive Service Overseas)—an arm of the Canadian Government. CESO has already offered us advisory assistance from a retired senior executive in Canada’s highly successful tourism industry. This individual, Michael Elcock, made an extensive visit to Simiatug and each of the Four Villages in November 2018, on a research, fact-finding and advisory mission.

These relationships have had a beneficial effect on our ability to develop skills and training programmes, and to reach out to potential markets. We are now in the process of developing a series of strategic partnerships. Among these will be partnerships with tour operators who specialise in visits to remote areas; operators that cater to a special kind of tourist—people who want a unique, ‘hands-on’ experience; the kind of experience not available to the average traveller.

The companies we have targeted are many, but include established businesses like Intrepid Travel (Toronto, Canada & Melbourne, Australia), Mountain Travel Sobek (San Francisco, USA), and Wilderness Explorers (Georgetown, Guyana). Companies like these provide much of the equipment their tourist clients require and we will learn from them as we develop our own facilities and activities, and train our personnel. Companies like these—and there are many others—are examples of the type of business partners we will develop. https://www.tripsavvy.com/adventure-travel-companies-with-small-groups-34048 From examples of similarly remote destinations in other parts of the world, we expect companies like these to deliver approximately 60-66% of our guest volume. We would expect other tour operators to send us a further 10-12% of our guests, with the remainder of our guests being independent travellers. We will work hard to nurture these partnerships, and to diversify our market reach among a wider group of specialist tour operators and independent travellers.

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It is also important for us to develop informal and formal partnerships with educational institutions in Ecuador and other countries. As mentioned above, we have already established a relationship of reciprocal interests with Royal Roads University in Victoria, British Columbia, Canada.

However the Region Simiatug contains a wealth of flora and fauna, which our research suggests, would be attractive to studies of biology, zoology, botany, geology and geography at North and South American universities. As well, the region offers a fine resource for studies of social, anthropological, cultural and historical subjects.

Visits from educational partners will be invaluable to the economic development of the Region Simiatug. Research shows, for example, that educational tourism leaves a small footprint (in Australia it accounts for approximately 6% of visitor volume), but brings a substantial economic benefit (in Australia, 25% of visitor spending). It goes without saying that this market would also provide great opportunities for our guides and expedition leaders. These visitors would make use of the facilities in our planned Lodge, bring in significant revenue through overnight accommodations, guide services and food purchases. This in turn would finance the acquisition of specialist equipment for our personnel, the erection of new buildings for instruction and specialist activities, the development of technical support, an expanded guide complement, and the identification of new [eco-tourism] business opportunities. As well, it would lead to the development of our network of horseback trail rides and backpacking trails—along ancient tracks—and the construction of shelters and guest accommodations that are under development in each of Santa Teresa, Cutahua, Cocha Colorada and Pambucloma.

In due course we would expect to be able to train our own First Aid personnel—including a complement of versatile First Responders—and augment these activities with the procurement of medical supplies, thereby providing a ‘safety’ cushion for our guests.

Lastly, but perhaps of greater importance, we will continue to develop and nurture partnerships with food suppliers, craft makers, and other colleagues and suppliers across the Region Simiatug. b)

Promotion

ASOPRICELAT is developing promotional programmes in a variety of ways. Central to these will be the website for the Simiatug Professional Training and Tourism Centre—the Eco-Lodge and Training Centre—for which we are already developing a strong social media presence.

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Our existing relationships and partnerships with Royal Roads University in Canada, the Crossing Borders Foundation in Austria, and the Riobamba Foundation in Germany will be important to all our outreach initiatives, and in the immediate future to our international promotions.

As our infrastructure develops we will extend our network of international and national relationships. We will also conduct a campaign to increase media exposure through travel articles about birding, wildlife, indigenous cultures, and eco-tourism in and around the Region Simiatug.

Again, from experience and examples from similar initiatives elsewhere, we expect these efforts to result in the publication of invaluable ‘third-party’ articles in diverse and widely-read publications in a number of countries—publications such as USA Today, National Geographic Traveller, Toronto Star, Washington Post, L.A. Times, the Guardian (UK), Explore Ecuador, World Nomads and other media. c)

Demand from a world-wide market for opportunities to explore wild places

As planet Earth continues to shrink, more and more resources are consumed and our wilderness areas disappear. Pristine rural environments like those in the Simiatug region are more and more difficult to find. As economic pressures diminish natural resources in other parts of the world, our protected environment becomes more and more precious. We know that we have tapped into a growing wellspring of customers who wish to experience the Cordillera Occidental as it has evolved over centuries. As an appetite grows for the unique experiences in the four core villages of the Region Simiatug, we expect steady, controlled, market growth well into the 21st century. d)

Development of new programmes to attract a younger market

We are constantly exploring ways and means of reaching a younger market demographic—a European and North American one that embraces a more spartan, ‘back-packing’ concept. This is a growing market sector, and although it will not generate as much revenue as ‘in-house’ guests, it does not require costly infrastructure development. We believe that by developing a system of trails and hammock camps, we can encourage this market segment to come to Simiatug, and extend their stay in the mountains as we develop our guide services and recreational opportunities.

The root of this lies in our intent to develop lasting relationships by generating programmes at the Simiatug Hostel and Training Centre for the younger demographic. We expect this approach to ultimately generate a strong market of repeat visits.

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e)

Commitment by the villagers and the surrounding population to protect the environment in a responsible, sustainable manner

Grupo Simiatug Llakta (which includes the communities of Cocha Colorada, Cutahua, Pambucloma and Santa Teresa) is committed to measured growth in order to ensure that an influx of visitors will have the least impact on the environment, and this includes the cultural and social environment of the region. The entire area will be inventoried for the flora and fauna that lies within its boundaries. f)

Legal form of ownership

GRUPO SIMIATUG LLAKTA is a platform for Entrepreneurship, Associations, family-groups and productive initiatives of Simiatug Parish, which operates as a community-owned business—a quasi-corporation. Through its legal entity, the ASOPRICELAT (Production, Industrialisation and Marketing Association "Cielo en la Tierra") offers services of: project management, promotion of value chains, crafts, plants, meat products, dairy products, community tourism, constructions and infrastructures, metalworking and carpentry.

Structure: Board of Directors; Chairman; President/CEO; Director of Operations; CFO. Infrastructure and capital improvements would be the property of ASOPRICELAT, but the direction and day to day control of the infrastructure and capital items would be the responsibility of management and staff. Altogether ASOPRICELAT would remain a legal entity separate from any other organisation associated with Simiatug, the Region or any of the communities involved.

ASOPRICELAT maintains its own book-keeping system, bank accounts, financial records, and purchases equipment on its own behalf, as required, and solely for its own use.

The ultimate purpose of the organisation is to develop and produce the local resources of the 38 indigenous communities of the Simiatug Region. In doing this we will develop a strong community tourism product, enhance the talents and abilities of our artisans, and process and market the products of the organic farms of the region (including livestock); in other words to grow, manufacture and otherwise develop and then commercialise the finished products directly, without intermediaries.

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IV.

Products and Services

The environment around Region Simiatug is ideal for eco-tourism. Guests can enjoy the experience of Ecuador’s mountain culture, with its music, festivals and history, as well as a host of unique opportunities for hiking, climbing, bird-watching, wildlife spotting, and camping. Most important of all, is the fact that this is a region with a very strong community ethic, and thus an extremely secure and safe part of Ecuador, and the world.

ASOPRICELAT will deliver premiere eco-tours in and around Ecuador’s Bolivar region. Guests who come to our Hostel will be able to experience a world that has changed little over the years; a world of nature, peace and co-existence. In addition to the opportunities listed below our guests will be folded in to the culture of the mountains. Their experiences here can include staying in our communal hostel, learning about the diet and cuisine of our local people, and participating in cooking activities. In other words, they can dine on authentic Ecuadorian foods, which we may enable them to cook themselves as part of their visitor experience. Our guides, who have a lifetime of experience of the mountains, and deep knowledge of the wildlife and plants, will take them on excursions to special places of mythology, history and beautiful sights.

Included in the products and services we will deliver are:               

Guided Hiking Trips Horseback Riding excursions (and rentals for individual explorations) Guided multi-day mountain trips Bird Watching Horseback Riding Wildlife Observation Comfortable mountain accommodations Authentic rural Ecuadorian (& some Amerindian) cuisine Village Tours and Cultural Events – including craft demonstrations Study of Medicinal Plants Educational Forums Guide Training Farm Tours Cheese making Miércoles Mercado (Wednesday - Market Day in Simiatug)

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Pricing Pricing for different experiences, excursions, tours and products at El Cielo en la Tierra will be determined in association with our strategic partners. With them we will determine world market prices and pricing structures that will provide ASOPRICELAT and our tour operator partners with beneficial returns.

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V.

Marketing Plan (Overview)

Economics The eco-tourism industry in Region Simiatug is in its infancy, but—given the interest and enthusiasm of the people of the mountain villages—this fact makes the future for our communitybased operation most promising. Both the government and the private sector have embraced ecotourism as a growth market for the future. There are hard facts to support this premise—increased tourist volume to Quito, Ecuador’s coastal region, and the Amazonian forest areas, improvements to the rural road net, and an increase in different modes of transportation. Not to mention the influx of ´extranjeros´ who have migrated from other countries to become residents in cities like Cuenca—new residents who will host family and friends each year into the future. These all signify a positive future involving people who are seeking a tourism experience outside the run-of-themill when they visit Ecuador.

Some observations about the eco-tourism market in the region to the west of Ambato: Tourism is an economic sector that has a direct impact on other sectors because it generates demand for a wide range of goods and services across a region or country as tourists demand them.

Accordingly, an analysis of the socio-cultural and economic effects of tourism constitutes one of the essential tasks in a process of tourism promotion. It is vital to coordinate this process with a great many organizations and SME’s at local, regional and national level in order to ensure that the attractions—natural and cultural—which relate to a particular region are identified, inventoried and organized. This exercise will ultimately form the basis for an effective programme of promotion and destination marketing.

Ecuador is a country characterized by four worlds, or natural regions: Coast, Mountains, East and Insular Regions. As such it offers innumerable elements that provide the country with cohesion and contrast in a relatively small geographical area. Each province has something diverse and different to offer, either through its natural attributes, or in the diversity of its people—elements that are reflected in the culture and traditions of its peoples.

One such region is the province of Bolívar, which houses Aboriginal and Mestizo societies with their own customs, means of life, history, culture, archaeology and nature. The area contain countless attractions, and a growing tourist industry offers the opportunity to improve the quality of life of the inhabitants, and halt the drain of the regions’ youth from the countryside to the cities.

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A discussion paper from the World Tourism Organisation in 2006 entitled “Tourism and poverty in Bolívar”, indicated that three quarters of the population of the province is economically deprived, despite having a substantial component of the region’s tourist resources, and nearly 80% of the provinces’ tourist services. The city of Guaranda captures the bulk of the tourist market and a large proportion of associated services such as accommodation, and food and beverage. While the Guaranda canton has attractive tourist products, other cantons are far behind in the development of viable tourism initiatives—which are a key to economic regeneration and the fight against poverty. 

When it is completed ASOPRICELAT’s Hostel and Training Centre will be the only fullyfunctional, full-service, community-based eco-tourism facility and operation in the region.

We anticipate that it will host several thousand visitors a year.

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Interest and demand in our international target markets—individuals, educators and groups interested in a unique social, cultural and environmental experience—is growing. As more of the Earth’s resources are consumed the number of pristine natural environments diminishes.

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The baby-boomers of Europe and North America are reaching retirement age. They are living longer, they are sensitive to the environment, they want to explore new places, and they have great interest in things natural. They are also relatively better off financially than the generations before them, and thus more able, and inclined, to travel.

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Research shows that our main market, initially at least, is likely to come from an age range of 40 to 60 years and more—from the United States and Canada, and to a lesser extent from Europe and neighbouring South American countries. It shows that we can expect approximately 60% of these visitors to be women, and 40% to be men. They will often be urban dwellers who are seeking what is to them an adventurous experience, in a region that is relatively unknown to them, but above all, safe and secure.

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Other markets will open up for Region Simiatug as we develop and refine our operations.

For example, the “backpack generation” of educated young people with adventurous spirits and curiosity about other cultures and the natural world around them.

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Another example points up the enormous growth of studies in indigenous cultures, natural medicines, wild flora and fauna, and the plethora of related subjects at postsecondary institutions around the world. These interests, and the organisations and institutions that support them, can be targeted by our marketing personnel. These and similar programmes well-suited to the unique offerings at our Hostel and Training Centre can realise the enormous potential that we have to form ongoing relationships for study with schools, colleges and universities in different countries.

It has been recommended, for example, that we might target several of the world’s institutions for the purpose of forming partnerships to facilitate these studies. A great

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number of prestigious universities—such as Cornell and Stanford in the United States, Monash and Curtin in Australia, Trent and Carleton in Canada, Waikato in New Zealand, and many others around the world, have respected degree programmes of indigenous studies. In association with these studies we can find a great range of imaginative, yet important offshoots of those programmes, for example in such subject areas like Archeoastronomy—the study of astronomical practices and beliefs of past cultures, and Ethnoastronomy—the study of astronomical practices and beliefs of contemporary indigenous cultures. Some of the pueblos of the Region Simiatug, which have the advantage of altitude, and an absence of artificial night-time light, might well be able to offer attractive partnerships for programmes like these. 

The growth potential for the Region Simiatug is obviously significant. However, we neither want, nor can we handle, explosive growth. Our strategic plan indicates that we will limit growth in the “tour operator” segment of our market, and stimulate growth in the more profitable “self-promoted” segment of our market. Through our own website, and putting in place the necessary processes, procedures and controls to manage a self-booking system, ASOPRICELAT can better manage its own growth and profitability. In other words, we will ensure that we retain responsibility and ‘ownership’ of the tourism resources, and growth, at our disposal.

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Anticipated barriers to growth:  

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High cost of ground transfers for guests.

Poor ground transportation. One task is to encourage bus lines and independent mini-bus operations to service some sections of the Bolivar Region more regularly and efficiently. (However Simiatug does have a good transport cooperative called ´Coraviajes´—buses and mini-buses which leave from the town square in front of the church. The Coraviajes carry passengers to towns and communities near and far—places such as Salinas, Ambato, Riobamba, Guayaquil, Quito. Fares are priced by distance. Current examples—for a group of 4 people—are: $10 to Cocha Colorada or Pambucloma; $30 to Cutahua or Santa Teresa; $60 to Ambato.

Lack of accurate road maps and GPS services.

High cost of direct flights from Europe.

Development, training, and ongoing management are needed for the Hostel and Training Centre, as well as the ASOPRICELAT website - plus a comprehensive promotional program to let the world know who we are, where we are, and our ‘product’ range.

Staff need training in the hospitality field, and in developing the technical knowledge required to support the website, booking and accounting systems, and with learning the English language.

Overcoming barriers to growth 

We cannot control the ground transportation charges imposed by our tour operators, so we will work to develop and provide some ground transportation

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Disposition of Primary Geographical Markets  

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for our guests at a lower price than they are charged by tour operators—for example with the existing Co-op de Transportes Coraviajes.

We will publish detailed information about internal travel and public transportation to Simiatug on our website. This simplifies information about what can be a daunting challenge for people who have never been to Cordillera Occidental before. It also provides travel and transportation options for all our guests—including those who come in from neighbouring countries.

We will develop detailed Role Specifications (Job Descriptions) for all our personnel, and an employee manual to cover all aspects of employment with ASOPRICELAT. This will include our expectations of employees, pay schedules, vacation allowance, and related matters.

Our employees will be well-trained in hospitality skills, in order to provide services of the highest standard. Our employee training programme will therefore be constantly under review and improvement. We will introduce all personnel to an employee manual which contains work expectations, work safety and first aid procedures, and sets out requirements for customer service, food-safe procedures, and technical skills.

Our primary markets will be found in countries and regions where there are direct flights to Quito, or flights with no more than one transfer.

Geographically this will include residents of all the countries in North, Central and South America. About 10-12% of our market will come from Europe (e.g.

Spain, Netherlands, Belgium, Italy, France, Germany, Austria, UK). There is also a strong adventure travel market segment in Australia and New Zealand.

Research tells us that residents of the United States and Canada will be in the forefront of these countries. There are reasons for this, including the obvious factor that the currency is similar, and familiar.

The southern United States is well-populated and quite well-off financially, and has a sizeable Spanish-speaking population. Many US airlines have direct flights to Quito from hub cities such as Atlanta, Miami, Houston and New York, as well as other major population centres. In Europe, KLM and Iberia operate direct services from Amsterdam and Madrid respectively, to Quito. Other European carriers provide similar services.

Summary We expect our guests will be well-travelled individuals and small groups who support eco-tourism—and especially those eco-tourism businesses that are community-based.

Many will typically be middle to upper class professionals, often with advanced university degrees. They will be people who seek opportunities to travel “off the beaten path.” They are computer literate, independent, and occasional risk takers. They enjoy the prospect of being immersed in a new culture, and tend to be averse to facilities that are homogenised, or “westernised”.

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We expect that our guests will enjoy the indigenous comforts they will find at ASOPRICELAT’s Eco-Hostel. Many of them will come from a demographic that supports organisations such as the World Wildlife Fund, and Conservation International. The operation at ASOPRICELAT’s hostel and Training Centre will clearly exemplify similar values. We believe our guests wish to preserve the eco-system of our planet, and will gladly spend their holiday dollars supporting organisations like ASOPRICELAT’s Lodge and Training Centre. 

Competition There is nothing in the Cordillera Occidental to compare with what will soon become ASOPRICELAT’s Hostel and Training Centre; nothing to rival the ‘hands-on’, cultural immersion experience we will offer our visitors. To be sure, there are some other tourism-related businesses within 25 miles of Simiatug, but none offers a comparable experience. Our purpose is to act as a catalyst in building an industry with shared values, but with considerable variety to it—a living experience, which will help to lengthen the average visitor stay in the region. As a consequence of this, a component of our business and marketing plans is that we will also recommend other lodges and eco-tourism operations in the region to our guests. In return, we expect to host visitors who come from our competitors to enjoy what we have to offer.

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Niche ASOPRICELAT’s Hostel and Training Centre will offer a unique experience and thus fill a highly-specialised market niche—a bridge between different kinds of tourism experience in a niche that is experiencing growing demand. Our competition will grow—with our encouragement—as other village groups develop their own ecotourism businesses.

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Strategy Our Marketing strategy has a four-pronged approach. Each initiative builds on the others.

1) Website: Grupo Simiatug Llakta maintains a popular website presence through the domain name www.simiatug.com/. We also have a strong Facebook presence which we use to communicate with hundreds of followers about the life and activities of El Cielo en la Tierra. We will market the site aggressively through companies like Constant Contact and Google Small Business, and ensure we are reviewed with the widely consulted TripAdvisor. The website will increase the number of independent travellers that we host, and serve as a gateway to information about new programmes as they are developed.

2) Strategic partnerships with tour operators: Grupo Simiatug Llakta attends selected tourism marketing shows and conferences. We will be attending more as we develop our facilities and operations network. We see no need to provide financial and personnel support to enable some selected, specialist tour operators to attend such shows as our fulfilment network expands. We may in the future

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provide some financial support for mixed media advertising that our tour operators publish on our behalf. We will encourage, promote and support “familiarisation trips” on behalf of tour operators.

3) Promotional materials: Our staff members will have business cards. This is especially important for our guides and other personnel who have direct contact with our guests. We have developed information ‘rack’ cards for distribution at tourism fairs and other venues. Central to our promotional campaigns—and designed to encourage repeat visits—is a quarterly electronic newsletter that we will publish and distribute to our past guests. This is designed to enhance our ‘word-of-mouth’ advertising—the most effective recommendations we can have.

4) Guest Contact Information: In accordance with the objectives outlined in #3 above, we will collect names, home addresses and most importantly, e-mail addresses from our guests. We are developing a guest evaluation card for our visitors to complete when they leave ASOPRICELAT’s Hostel and Training Centre. This will help us to monitor and improve our service levels. Guest information is an essential element of our marketing program—and to our operational performance. 

Distribution Channels

a) Tour Operators: Our partnerships with selected tour operators are under development.

Improved communications, and strong market targeting result in increased revenues. b) Direct Marketing and Sales through our Website: This will show results as it develops into a primary information distribution channel—because it will become a direct communication link with our guests. Our website, which we continue to develop, enables us to promote our products, and will facilitate our ability to confirm and book clients, receive credit card payments, and initiate follow-up correspondence with our guests.

Product Features and Benefits 

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Authentic Accommodations  Features: Clean, warm, with mountain and valley views. Flush toilets and ample water for showers. Hand-washed sheets on comfortable beds.  Benefits: Guests will be able to enjoy restful sleep in rural, village environments.

Well constructed to provide privacy, with atmospheric views that enable guests to experience the unique atmosphere of the mountains, valleys and farmlands of El Cielo en la Tierra.

Guided Hiking Trips and multi-day mountain trips to the Four Villages  Features: Guided trips led by local villagers with an extensive, lifetime of knowledge about the surrounding area.  Benefits: Guests receive specialist information from experts about the local flora and fauna. They have an enjoyable, safe and comfortable experience, with opportunities to learn and participate in the life of the mountain villages.

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Bird Watching  Features: Simiatug Hostel and Training Centre will have pre-eminent birding guides on its staff. As well, the people who live and farm in the villages of Santa Theresa, Pambucloma, Cutahua and Cocha Colorada are extremely knowledgeable about the bird life in their area. Hundreds of species of birds inhabit the Region Simiatug, including of course the magnificent Condor. Some of these birds are unique to the mountains of the Cordillera Occidental, and there are many migratory species to be seen as well.  Benefits: With many different species available, an outstanding guide on staff, and knowledgeable personnel in the pueblos, the chances of our guests seeing birds on their life list are greatly increased. Our location among the mountains and valleys of central Ecuador, is a perfect place to see birds that are unfamiliar to North Americans and Europeans in their native habitats.

Mountain Survival Training  Features: We are currently researching the possibilities of forming a partnership with an Outdoor Association to deliver mountain survival programmes of a high— possibly quasi-military—standard.  Benefits: Guests will return from this training with skills, knowledge and experiences that are virtually unavailable anywhere else.

Sport Fishing  Features: This activity is also under consideration. The river systems in the Cordillera Occidental contain many species of fish. We are considering offering this programme, with knowledge of which species are protected, and a guide familiar with the species that can be fished for food.  Benefits: Guests will be assured of the best opportunities for catch and release, or to catch and eat enough for their needs.

Wildlife Observation  Features: Populations of Vicunas, the tiny Pudu Deer, Armadillo, Paca, Puma, the Andean Fox, Tapirs, and the Spectacled Bear live in and around the Andes. Visitors can see the tiny Hummingbird, and the great Condor. Our guides have spent a lifetime among the wild fauna and flora of the mountains.  Benefits: We will to our best to ensure that our guests are able to observe the many animals and birds that they have come to see and photograph.

Village Tours and Cultural Events  Features: The villagers of the Region Simiatug hold cultural events and celebrations throughout the year in recognition of their heritage, holidays, and spiritual beliefs.  Benefits: Guests who stay with us during these events have the opportunity to be totally immersed in these cultural celebrations.

Steam Bath and Massage  Features: Relaxing, authentic steam bath and massage.  Benefits: After a long day of hiking, riding or paddling, guests can revel in the pleasure of an authentic steam bath, with a massage to relax their tired muscles.

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We already offer some of the finest hospitality in the Ecuadorian Andes with our products and services. The villages of the Region Simiatug have friendly, well-trained staff who welcome our guests. More importantly, the people of the region are wonderfully open and friendly to visitors.

Additional Products and services currently under consideration:  Educational Forums  Crafts  Agriculture  Study of Medicinal Plants and indigenous Healing Practices  Study of Amerindian cultures  Studies of indigenous flora and fauna  Local Cuisine  Expanded Guide Training Programmes

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VI.

Operational Plan

Within a year of coming up to full operational standard and capability, we expect our Hostel and Eco-Lodge to host an average of five guests per day throughout the year. These guests will be met by hostesses who will provide them with traditional hospitality, keep their accommodations spotlessly clean, and arrange and/or prepare delicious and unique local dishes. In brief, they will be treated to an authentic Cordillera experience.

When our guests ascend the mountains to explore the pueblos of Cocha Colorada, Santa Teresa, Pambucloma and Cutahua, or trek out on bird watching excursions, they will be led by experienced guides. Our guide staff is comprised of men and women who have spent a lifetime living and working in the surrounding region.

We will soon complete an operational plan which codifies role specifications and expectations for all staff and management at Simiatug’s Hostel and Eco-Lodge.

Production Simiatug Eco-Lodge and Training Centre will become a hospitality destination for eco-tourists.

The ‘product’ that we deliver does not deplete our precious natural resources, nor does it negatively impact our Kichwa home and culture. We offer opportunities for the world to experience our planet as it existed centuries ago. 

Quality Control  

We will ensure the delivery of high standards of service and safety through the diligent oversight of an Operations Manager who will be on-site whenever guests are in residence.

Our quality control programme will be outlined in a supporting manual. This will cover the following areas:  Communications for guest intake  Staff management and employee expectations.  Food service presentation  Consistent service delivery across all departments.  Internal controls  Communications with strategic partners  Financial controls We will institute a probationary period for new employees before offering them permanent full time positions. Details will be outlined in the Personnel section.

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Customer Service 

Simiatug Eco-Lodge and Training Centre will be operated and staffed by friendly, courteous, and cheerful personnel whose attitudes will exemplify how it feels to live in a place aptly named El Cierro en la Tierra.

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Inventory Control 

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Our Quality Care program will encourage guests to evaluate their experience.

This will give us invaluable feedback on all aspects of our customer services.

Inventory control systems will be in place for each section and department of the organisation.

Product/Service Development 

Each new programme, concept, plan or idea will be subjected to thorough scrutiny by our professional staff. The guidelines for their examinations will include:    

Does it fit with our Mission and Vision Statements?

If the answer is ‘no’, the idea gets no further scrutiny Will this have a positive or negative impact on our guests?

If the answer is ‘negative’, the idea gets no further scrutiny Financial impact. What will it cost? What is the profit potential?

What impact will it have on the environment?

Location Simiatug Eco-Lodge and Training Centre will be located in the regional centre of Simiatug, a small market town in a central valley of the region. Simiatug has bus service to Ambato and the provincial capital of Guaranda several times each day. Our location offers exceptional opportunities to experience the flora and fauna of several unique eco-systems in the mountains and valley of the area. 

Access 

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Simiatug is in a relatively remote area of Ecuador. It lies less than 2 hours by bus from the city of Ambato, and nearly 1½ hours by bus from the provincial capital of Guaranda. International flights arrive at Quito, which is a 2 ½ hour drive north of Ambato, and a 4½ hour drive from Simiatug.

The remoteness of Simiatug and the mountain villages adds to the attraction of this heavenly beautiful region, and to its marketability. Our guests will be people who are willing to endure sometimes challenging transportation systems in order to experience our extraordinary, compelling environment.

Construction  The facilities at Simiatug Eco-Lodge and Training Centre will include an office with Internet and possibly some staff accommodation. The Lodge will have storage facilities, a kitchen and a dining area, a small bar, and a gathering/meeting/social place with views across the valleys to the mountains.  The Lodge will have four rooms to accommodate guests—one for couples, two for groups of four people, and one for groups of six. Each will have an ensuite shower and toilet. As the business grows we expect to build more accommodations.

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A small kitchen garden will produce fresh vegetables and fruit for our guests.

Legal Environment Simiatug Eco-Lodge and Training Centre will operate under the same legal protections as the organisation ASOPRICELAT. 

Licensing  ASOPRICELAT has a business licence in Ecuador. On legal advice Simiatug EcoLodge and Training Centre will either take out an independent business license, or operate under the existing license of the parent company. Either way, the license will enable the organisation to have a bank account which will serve as the central depository for all funds generated by operations at the Eco Lodge and the Training Centre.

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Branding, Trademarks, Copyrights  Branding already includes ownership of the Internet domain http://simaigtugllakta.com/. Further branding already includes or will include, trade marking:  Certified Simiatug Eco-Lodge Guide  Certified Simiatug Village Product  Certified Product hand-made in Region Simiatug, Ecuador

Personnel  Number of Employees  The Eco-Lodge and Training Centre will employ personnel on an ‘as-needed basis.

When the operation. Is fully established, we expect it will employ approximately 30 personnel in the Centre and in the pueblos of Santa Teresa, Pambucloma, Cutahua and Cocha Colorada, all them local people, in. A variety of full and parttime roles. The number of employees will fluctuate with seasonal guest loads. 

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We expect the average complement of employees and job classifications will be:  4 Management and Administrative staff (incl. Finance)  12 Professional Guides  4 Cooks  6 Housekeepers  4 Maintenance personnel

Type of labor (skilled, unskilled, and professional) 

All our personnel will be skilled and highly professional. Our guides have spent their lives amassing comprehensive knowledge of the mountains and valleys, the varied types of agricultural operations, the forests plantings, the geography,

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geology, flora and fauna, the indigenous mythologies, folkways, music and history of this region, along with a priceless understanding of the creatures that inhabit them. Their skills ensure that they are thoroughly conversant with the challenges and occasional dangers that our environment might present. The knowledge and skills they possess can only be obtained through time, observation and experience. 

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Similarly, the cooks, housekeepers and maintenance personnel we will engage are already thoroughly proficient. The administrative staff we have in place are developing additional skills in leadership, accounting, and business management in the field of enterprise tourism and will augment these through training programmes.

Where and how will you find the right employees? 

As stated in the Vision Statement, it is the purpose of ASOPRICELAT to provide employment opportunities for the inhabitants of the region.

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Quality of existing staff  We are proud of our staff. They are well-trained and they work to an enviable degree of efficiency. Their performance abilities are exceptionally good. We welcome all opportunities to upgrade the skills and knowledge of our personnel in business procedures. We have already developed excellent training programmes for the personnel who will work in all aspects of our tourism enterprises.  In order to ensure that our service standards remain high we have instituted a probationary period for new employees before offering them permanent positions.

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Pay structure  Employees are paid monthly, on a scale commensurate with their experience, time on the job, demonstrated abilities, and job position.

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Training methods and requirements  Training programmes for our tourism enterprises are already in place, and we will develop others as new programmes come on stream. Leadership development is part of this, and is already a part of our association with Royal Roads University in Canada.

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Role Specifications (Job Descriptions) for employees  These have been completed for all employee roles.

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Contract workers  ASOPRICELAT contracts outside labour on an ‘as-needed’ basis. Simiatug EcoLodge and Training Centre will do the same.

We expect the following services are normally be contracted out:  Transportation.  Internet services and support. However we have employees and colleagues who are already competent in website development and maintenance, and

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will continue to expand our own capabilities in this regard. Wherever we can we will reduce the expense of out-sourcing technical expertise.

We intend to develop a ‘train the trainer’ programme, so that once trained, our personnel may train others.

Skilled construction, electrical and carpentry work.

Inventory  Inventories will be relatively small because our tourism enterprise will be a service business. We have acted for several years as a re-seller of crafts and other items produced by villagers, and these are carefully inventoried. We will ensure that the Lodge’s equipment and supplies are logged, signed out, and carefully monitored.

Suppliers  Key suppliers will be selected on the basis of reputation, recommendation and a tender process wherever possible. We expect them to fall under the following categories:    

Provision of consumable goods, mostly foodstuffs.

Some transportation services.

Building, plumbing and electrical maintenance.

Translation services, as required.

Managing Accounts Receivable  ASOPRICELAT already has an enviable and accurate book keeping system, an efficient delivery of invoices, and keeps comprehensive records of accounts payable and accounts received. It is our intention to ensure that all payments and receipts for the tourism enterprise are expedited.

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VII. Leadership and Organisation Leadership The Simiatug Eco-Lodge and Training Centre, and the associated eco-tourism business is a community-based operation. It will be overseen by a small, regional eco-tourism committee.

Periodic assistance will be sought for capacity building in various business areas.

Leadership Team  Board of Directors: The Simiatug Eco-Lodge and Training Centre, and the associated tourism enterprises will be led by a three-person board of directors. The board will include a Chair who is involved with the Eco-Lodge and Training Centre, and a member from two of the villages of Santa Theresa, Cocha Colorada, Cutahua and Pambucloma, who will rotate on a staggered two-year basis, so that only one changes each year. The Board sets the vision and direction for the business. The Board approves the annual budget and all major capital expenditures. 

President: The President has overall leadership of all business operations. The President works with the Director of Finance and the Director of Operations to ensure that guest expectations are met, that guests enjoy their experience at the Simiatug Eco-Lodge and associated tourism enterprises, and that business goals are achieved. The President, with input from the Directors of Finance and Operations, develops and maintains business protocols including, but not limited to, employee manuals, health and safety standards, and employee training.

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Director of Finances: The Director of Finances has overall responsibility for all financial aspects of the business. The Director is responsible for preparing budgets, overseeing all expenditures, managing bank deposits, dispersing funds and preparing payrolls. The Director is also responsible for guest intake procedures including reservations and coordination with tour operator partners. The Director is responsible for coordinating guest intake procedures with the Director of Operations. The Director is responsible for maintaining all financial records to standard book keeping protocols and to maintaining them in a safe and secure environment.

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Director of Operations: The Director of Operations is responsible for the day to day operations of the Eco Lodge. The Director leads the staff in delivering a high standard of customer service to our guests. The Director oversees and manages all Guide, Cooking, Housekeeping and Maintenance personnel, including hiring, firing, training and evaluation of these staff members. The Director is responsible for coordinating guest intake procedures with the Director of Finances.

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Consultant Business Manager: The Consultant Business Manager is an external business expert who may be engaged on occasion to fulfil certain requirements. This consultant

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would normally be charged with working with the Board of Directors, the President and the Directors of Finance and Operations to develop all, or some of, the following:    

Business processes and procedures Staff training and development protocols Business and marketing plans Other business needs as determined by the Board or the President

A Consultant Business Manager is only engaged when necessary, for a fixed period of time, and hired under terms mutually agreed by the Consultant, the Board and the President.

Professional and Advisory Support (The following are engaged or co-opted as deemed necessary) 

Board of Directors

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Management Advisory Board

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Attorney

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Accountant

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Insurance Agent

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Finance/Banker

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External Consultant

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Mentors and Key Advisors

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VIII. Financial Plan The financial plan will consists of a 12-month profit and loss projection, a four-year profit and loss projection (optional), a cash-flow projection, a projected balance sheet, and a break-even calculation. Together they constitute a reasonable estimate of the company's financial future. Most importantly, the process of thinking through the financial plan will give insight into the inner financial workings of the company.

12-Month Profit and Loss Projection Four-Year Profit Projection (Optional) Projected Cash Flow Opening Day Balance Sheet Break-Even Analysis A break-even analysis predicts the sales volume, at a given price, required to recover total costs.

In other words, it is the sales level that is the dividing line between operating at a loss and operating at a profit.

Expressed as a formula, break-even is: Break-even Sales

=

Fixed Costs 1- Variable Costs

(Where fixed costs are expressed in dollars, but variable costs are expressed as a percentage of total sales.)

Include all assumptions upon which the break-even calculation is based.

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Appendix 1

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Appendix II

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