Telfer - Strategic Analysis and Challenges Faced
Explore the strategic analysis and challenges faced by Telfer, a tech-facing hospitality company aiming for growth and sustainability. Dive into the current situation, key issues, challenges, mandate, and strategic analysis to understand the company's trajectory and potential for success in North America.
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Presentation Transcript
TELFER Presented by the inner workings Of Jakayla Michel 1
Agenda 2
Agenda Telfer Background Current Situation Key Issues Challenge Mandate Analysis Decision Criteria Implementation KPI Financials Conclusion 3
Current Situation Telfer $300m is earmarked for expansion in the US 1 to 1 million in 6 years in India A tech-facing hospitality company with a $10 billion valuation Prices adjusted to arrivals has been working in most cases. Increased trust because of the strict guidelines An Intuitive app managed by 1000 back-end engineers Key takeaway: Company on an evident growth trajectory 5
Key Issues Telfer The company has been in a loss Founder reputation Does charging low prices offset high overhead costs? Ergo, will the business model be sustainable in the long run? Key takeaway: Will there be job security given the above issues at hand? 7
Challenge Telfer Make our franchisees profitable To harness the power of Network effect? Key takeaway: Resonate the above in the strategy approach 9
Mandate 10
Mandate Telfer Not only test but sustain in North America taking tech driven decisions Key takeaway: 11
Analysis 12
Analysis - Strategic Telfer Is the market attractive? Key takeaway: Given the opportunities that lay in front of OYO there is a potential of growth and to make profit 13
Analysis Strategic 2 Telfer Is the market attractive? Key takeaway: OYO is strong enough to overcome potential threats 14
Analysis - Financials Telfer Oyo entered China in 2017 and is now bigger than India 500000 No. of Rooms 400000 300000 200000 100000 0 China India Key takeaway: OYO can enter new markets and capture significant market share 15
Analysis - Financials Telfer US economy market hotels are comparable to Asia Pacific 100% 80% 60% 40% 20% 0% Asia Pacific US Economy market Key takeaway: Unbranded hotel market in the US economy market presents an opportunity for expansion 16
Analysis - Financials Telfer Revenue has caught up with losses and leapfrogged in 2019 US $ millions 800 700 600 500 400 300 200 100 0 2016-17 2017-18 2018-19 (Estimates) Realised value Revenue Net loss Key takeaway: Unbranded hotel market in the US economy market presents an opportunity for expansion 17
Options 18
Options Telfer Do not Apply to the job Apply to the job 19
Decision Criteria Telfer Yes No Maybe Strategy makes sense? Overcome challenges? Strong prospects for future Is the business sustainable Does the business translate to the American market Key takeaway: Should Michel Apply 21
Implementation Time period 2 years Telfer Aggressive Franchise Acquisition Create a Franchisee Sustainable division Key takeaway: Leverage Network Effect to create a virtuous cycle 23
Decision Criteria Telfer Yes No Maybe Strategy makes sense? Overcome challenges? Strong prospects for future Is the business sustainable Does the business translate to the American market Key takeaway: 24
Key Performance Indicator Telfer Number of hoteliers to 4500 Owners have positive net income Capture 5% of the total market share Number of rooms o 112,500 Key takeaway: Sign up franchisees and keep them in the positive 26
Financials 27
Financials Implementation Cost Telfer 2019 2020 2021 2022 2023 Hiring Business Development Manager 2 2 3 3 3 Territory Operations Leader 1 1 2 2 2 Field Sales Representatives 10 10 20 20 25 Marketing costs Advertising Social media B2B Marketing 5 1 2 5 1 2 5 1 2 5 1 2 5 1 2 Operations HR 10 10 10 10 10 Franchisee profit division Data scientists 1 1 1 1 1 1 1 1 1 1 Renovations 110 143 110 143 110 155 110 155 110 160 28
Financials Telfer Revenues even at the 66% occupancy levels are good for turning profits 350 300 250 200 150 100 50 0 2020 2021 2022 2023 Total revenue at 66% Total revenue at 90% 29
Financials Telfer Profits at 66% occupancy in US $ millions 350 300 250 200 150 100 50 0 2020 2021 2022 2023 Costs Profits 30
Financials Telfer Profits at 90% occupancy in US $ millions 400 300 200 100 0 2020 2021 2022 2023 Costs Profits 31
Conclusion 32
Appendix 33
2020 2190 25 54750 2021 4380 25 109500 2022 6570 25 164250 2023 8760 25 219000 Hotels Rooms Total number of rooms RevPAR Average occupancy at 90% revenue of the hotel Revenue of Oyo as fees Revenue of Oyo as renovation costs Total revenue Average occupancy at 66% Revenue of the hotel Revenue of Oyo as fees Revenue of Oyo as renovation costs Total revenue 50 50 50 50 49275 493 98550 986 147825 1478 148 197100 1971 197 49 25 74 99 49 148 74 222 99 296 36135 361 72270 723 108405 1084 108 144540 1445 145 36 18 54 72 36 108 54 163 72 217
Total in millions People Salary Total salary 10 10 100 10 10 105000 110000 100000 100000 100000 1050000 1100000 10000000 1000000 1000000 1.05 1.1 10 1 1
Average number of rooms in a hotel No of hotels in a year 2190 Renovatio n per room Renovation per hotel 2000109500000 Renovation per hotel in million 25 109.5
