Jin Jiang Group

Information for handout

1. Porter’s 5 Forces

5.Financial implementation

Cathay pacific: 27,6 million guest carried in 2011

Estimated increase for airline after five years is 0.2%

Estimated increase in amount of guest carried after five years is 276000

Revenue streams

* 80% international(30% leisure guests and 50% business guests)

* 20% national travelers

* based on loose tickets and 5% profit margin per package

Y1: RMB 19673114 (€ 2,4 million)

Y2: RMB 25296064 (€ 3,1 million)

Y3 :RMB 30919014 (€ 3,7 million)

Y4: RMB 36541965 (€ 4,4 million)

Y5: RMB 42164915 (€ 5,1 million)

Fixed costs per year

Employees:

Manager and IT RMB 238173

Marketing RMB 357290

Other costs:

Reward system RMB 82701 (€10.000)

Marketing costs RMB 206494(€25.000)

Total fixed costs per year RMB 884685

NPV | Cash Flow | Discount factor 8% |

year 0 | -26854039,00 | 1,00 | -26854039,00 |

year 1 | 18967101 | 0,8772 | 16637941 |

year 2 | 24590051 | 0,7695 | 18922044 |

year 3 | 30213001 | 0,6750 | 20393776 |

year 4 | 35835952 | 0,5921 | 21218467 |

year 5 | 41458902 | 0,5194 | 21533754 |

| | | |

IRR | 86,01% | NPV | 71851943 |

Package, which includes flight, transfer and 12 days stay in Jin Jiang 3 star rated hotel.

RMB 8150(€ 985,-)

‘’The Mark, the English letters 'JJ', relate to 'Jin Jiang' – a famous Chinese brand. It is also a part of our efforts to raise awareness of the Jin Jiang Hotels among overseas guests and is a statement of our ambition towards internationalization. It embodies our vision to serve the world’’ (source: http://www.jinjianghotels.com)

6. McKinsey 7-S model

Stucture

Style:

* leadership

* employees

Systems

* management information system

* controlling system

* customer relationship system

* reward system

Changing business model