Are you about starting a hot air balloon company? If YES, here is a detailed sample hot air balloon rental business plan template & feasibility report you can use for FREE.
Okay, so we have considered all the requirements for starting a hot air balloon rental business. We also took it further by analyzing and drafting a sample hot air balloon marketing plan template backed up by actionable guerrilla marketing ideas for hot air balloon rental companies.
If you live around any tourist location, then you should consider starting your own hot air balloon rental business. The truth is that you can make cool cash from this business with little effort if you are well positioned.
Hot air balloon business can only be restricted to a certain geographical area because hot air balloons are flown as hobbies, recreational and in festivals or competitions, which is why before starting this type of business, you must ensure that you are in a place where this type of business can thrive.
Establishing a hot air balloon rental business can be expensive because the balloons themselves are expensive. Equally, maintenance cost and even fueling can also be expensive. If you are determined to explore the entrepreneurial world by starting a hot air balloon rental business, then you should consider going through the business plan template below.
A Sample Hot Air Balloon Rental Business Plan Template
1. Industry Overview
A hot air balloon is a lighter-than-air aircraft consisting of a bag, called an envelope, which contains heated air. Suspended beneath it is a gondola or wicker basket (in some long-distance or high-altitude balloons, a capsule), which carries passengers and a source of heat, in most cases an open flame caused by burning liquid propane.
Depending on the size of the balloon, location, and intended use, hot air balloons and their pilots need to comply with a variety of regulations.
As with other aircrafts in the USA, balloons must be registered (have an N-number), have an airworthiness certificate, and pass annual inspections. Balloons below a certain size (empty weight of less than 155 pounds or 70 kg including envelope, basket, burners and empty fuel tanks) can be used as an ultralight aircraft.
Hot air balloon business is a subset of the Sightseeing transportation industry and operators in this industry provide ground, nautical and aerial sightseeing transportation for everyday consumers.
Examples of services include: sightseeing buses and trolleys; steam train excursions; horse-drawn sightseeing rides; helicopter rides; hot air balloon rides and boat and dinner cruises. The services provided are usually local and involve same-day return to the place of origin.
A recent report published by IBISWorld shows that over the five years to 2019, the Sightseeing Transportation industry benefited from improving economic conditions, including rising levels of per capita disposable income, which resulted in many consumers increasing their recreational expenditure.
Moreover, domestic travel activity increased during the five-year period, supporting revenue growth. However, the number of inbound trips by non-US residents experienced volatility, resulting in fluctuations in industry revenue growth.
In recent time, the Sightseeing Transportation Industry has managed to untangle from its early post – recessionary bumps. Per capita disposable income and consumer confidence will keep rising as unemployment rate continues to decline, providing consumers with more discretionary income for luxury services such as renting of hot air balloons for fun.
The Sightseeing Transportation Industry is indeed a growing sector of the economy of the united states of America and they generate over million annually from more than 9,443 sightseeing transportation businesses (hot air balloon rental companies inclusive) scattered all around the United States of America.
The industry is responsible for the employment of over 37,205 people. Experts project that the industry will grow at a 1.5 percent annual rate between 2014 and 2019. Please note that no player can boast of having a lion share of the available market in this industry.
The industry is growing only marginally slower than the economy as a whole, which suggests that the industry is mature. Additionally, the industry exhibits characteristics of mature industries, such as stable long-term demand and minimum product innovation. Product innovation has grown at a relatively steady rate over the five years to 2017.
In summary, the hot air balloon rental business is very open to any aspiring entrepreneur who has the capacity to open and run his or her business. Just ensure that your hot air balloon rental business is located around a tourist center and of course in an environment with the right demography and you will be fine.
2. Executive Summary
Golan Heights® Hot Air Balloons, Inc. is a licensed and registered sightseeing transportation business. We have been able to secure a standard and well – positioned facility in Newport Beach – California. Newport Beach which happens to be one of the most visited beaches in the United States can boast of receiving 9,703,500 beach goers annually in a city with a population of 85,323 people which translate to 113.7 per capita beach goers.
We are set to compete in the fast growing and fragmented Sightseeing transportation industry not only in Newport Beach – California, but also in cities with beaches in the United States.
Golan Heights® Hot Air Balloons, Inc. will run a standard hot air balloon business that will provide sightseeing transportation via hot air balloon for individuals, sport clubs and travel and tour companies, etc. Our business goal is to become one of the leading hot air balloon companies in the United States and we will make sure that we compete favorably with leaders in the sightseeing transportation industry.
Our workers are going to be selected from a pool of hardworking, creative and highly experienced workers in and around Newport Beach – California. We will make sure that we take our workforce through the required training that will position them to meet the expectation of the company and to compete with leading hot air balloon companies in the United States.
At Golan Heights® Hot Air Balloons, Inc., our client’s best interest will always come first, and everything we do will be guided by our values and professional ethics. We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely.
Golan Heights® Hot Air Balloons, Inc. is owned by Garvey Mackeson who has hands – on experience when it comes to running a hot air balloon. The business is family business hence he will be managing the business alongside members of his immediate family and other business partners.
3. Our Products and Services
Golan Heights® Hot Air Balloons, Inc. was established with the aim of maximizing profits in the sightseeing transportation industry.
We want to compete favorably with the leading hot air balloon companies in the United States which is why we have but in place a competent team that will ensure that our hot air balloons meet and even surpass our customers’ expectations.
We will work hard to ensure that Golan Heights® Hot Air Balloons, Inc. is not just accepted in Newport Beach – California, but also in other beach communities in the United States of America. Our products and services are listed below;
- Inshore/coastal hot air balloon transportation services
- Offshore hot air balloon transportation services
- Tournament hot air balloon rental services
- Commercial hot air balloon charter services
- Merchandise sales of hot air balloon related safety kits and souvenirs
4. Our Mission and Vision Statement
- Our vision is to establish a standard hot air balloon business with some of the latest balloons in the United States. We want to become the leading hot air balloon company in the whole Newport Beach – California
- Our mission is to provide a world – class hot air balloon rental service that can attract a wide range of clientele in and around the United States of America. We want to build a brand that can favorably compete with other leading brands in the industry, hence we will place high premium on the safety of our clients.
Our Business Structure
Golan Heights® Hot Air Balloons intends starting small in Newport Beach – California, but hopes to grow big in order to compete favorably with leading companies in the industry. We are aware of the importance of building a solid business structure that can support the kind of world class business we want to own. This is why we are committed to only hire the best hands within our area of operations.
At Golan Heights® Hot Air Balloons, Inc., we will ensure that we hire people that are qualified, hardworking, creative, customer centric and are ready to work to help us build a prosperous business that will benefit all the stakeholders.
As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of five years or more as agreed by the board of trustees of the company. As a means of maximizing operational cost, we will contract the maintenance of all our hot air balloons to a service provider, we don’t intend to maintain a very large overhead from the onset.
But as soon as the business grows and stabilizes, we will assemble our own in-house maintenance team. In view of the above, we have decided to hire qualified and competent hands to occupy the following positions;
- Chief Executive Officer (Owner)
- Hot Air Balloon Operation Manager
- Sales and Marketing Executive
- Hot Air Balloon Pilots / Instructors / Operators
- Client Service Executive
5. Job Roles and Responsibilities
Chief Executive Officer – CEO:
- Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results; developing incentives; developing a climate for offering information and opinions
- Fixes prices and signs business deal
- Responsible for providing direction for the business
- Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
- Accountable for signing checks and documents on behalf of the company
- Evaluates the success of the organization
- Reports to the board
Hot Air Balloon Operations Manager:
- Serves as project manager of the organization; works directly with employees
- Develops strategic plan by studying the trends in the Sightseeing transportation industry, presenting assumptions; recommending objectives.
- Accomplishes subsidiary objectives by establishing plans, budgets, and results measurements; allocating resources; reviewing progress; making mid-course corrections.
- Coordinates efforts by establishing procurement, production, marketing, field, and technical services policies and practices; coordinating actions with corporate staff.
- Maintains quality service by establishing and enforcing organization standards.
- Maintains professional and technical knowledge by attending educational workshops; reviewing professional publications; establishing personal networks; benchmarking state-of-the-art practices; participating in professional societies.
- Supervises multi-disciplinary teams of staff including cleaning, maintenance, grounds and security
- Oversees hot air balloons building projects, maintenance or refurbishments
- Ensures that the organization work in line with international best practices.
Sales and Marketing Manager
- Manages external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
- Models demographic information and analyze the volumes of transactional data generated by customer
- Identifies development opportunities; follows up on development leads and contacts
- Writes winning proposal documents, negotiate fees and rates in line with organizations’ policy
- Responsible for handling business research, market surveys and feasibility studies
- Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
- Creates new markets cum businesses for the organization
- Empowers and motivates the sales team to meet and surpass agreed targets
- Responsible for preparing financial reports, budgets, and financial statements for the organization
- Provides managements with financial analyses, development budgets, and accounting reports
- Responsible for financial forecasting and risks analysis.
- Performs cash management, general ledger accounting, and financial reporting for one or more properties.
- Responsible for developing and managing financial systems and policies
- Responsible for administering payrolls
- Ensures compliance with taxation legislation
- Handles all financial transactions for the organization
- Serves as internal auditor for the organization
Hot Air Balloon Pilot/Safety Instructor/Operators
- Responsible for giving out instructions on how to make use of hot air balloons and ensuring the safety of everyone that rented our hot air balloon
- In charge of operating hot air balloons
- Responsible for making sure that our hot air balloons and our services meet the needs of the people that hire them.
- In charge of services such as cleaning, security and parking, to make sure the surrounding environment is in a suitable condition to work
Client Service Executive
- Welcomes clients and potential clients by greeting them in person or on the telephone; answering or directing inquiries.
- Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
- Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
- Manages administrative duties assigned by the Manager in an effective and timely manner
- Consistently stays abreast of any new information on the organizations’ promotional campaigns etc. to ensure accurate and helpful information is supplied to clients when they make enquiries
6. SWOT Analysis
Because we want to become the leader in our business, Golan Heights® Hot Air Balloons, Inc. engaged the services of a professional in the area of business consulting and structuring to assist our organization in building a well – structured hot air balloon business that can favorably compete in the highly competitive Sightseeing transportation industry in the United States.
Part of what the business consultant did was to work with the management of our organization in conducting a comprehensive SWOT analysis for Golan Heights® Hot Air Balloons, Inc. Here is a summary from the result of the SWOT analysis that was conducted on behalf of Golan Heights® Hot Air Balloons, Inc.;
We can boast of having some of the latest hot air balloons under our fleets. Our services will be guided by international best practices in the industry. Another strength that counts for us is our safety policy and the location of our business.
As a new hot air balloon rental company in Newport Beach – California, it might take some time for our company to break into the market and gain acceptance especially from top profile clients in the fast growing sightseeing transportation industry; that is perhaps our major weakness. Another weakness is that we may not have the required cash to pump into promoting our business the way we want to.
An increase in domestic flights typically indicates growing demand for tourism services. The number of domestic trips by US residents is expected to increase in 2019, representing a potential opportunity for the industry. As a hot air balloon company, we are ready to take advantage of any opportunity that is available in the industry.
Majority of the vehicles used by industry operators run on diesel fuel. Therefore, changes in the price of diesel affects industry operators’ revenue. When prices increase, operators’ purchase costs rise as well, and they must increase ticket prices to make up the difference. While this can lead to slight revenue gains, it also deters customers from purchasing industry services.
7. MARKET ANALYSIS
- Market Trends
A close reflection of trends in the Sightseeing transportation industry shows that industry now competes with other recreational activities especially in and around beaches and coastal lines. These activities include sightseeing buses and trolleys; steam train excursions; horse-drawn sightseeing rides; helicopter rides; and boat and dinner cruises.
Over the five years, the industry has lost ground to other forms of recreation as consumer preferences changed. External competition for the Sightseeing transportation industry is expected to increase in 2019, representing a potential threat to the industry.
Total recreation expenditures track the total amount spent by US consumers on recreation services, including industry services. Total recreation expenditure is expected to increase in 2019, representing a potential opportunity for the industry.
If you are involved in Hot air balloon, you will always have some people, who haven’t used it before coming to rent it; that is the reason why you must have competent instructors on ground to help guide novice clients. In some cases, depending on your policy, you might charge extra cost for those who want to learn how to fly/operate hot air balloons.
Hot air balloon operators in the bid to generate more revenue for their business engage in retailing safety equipment like life jackets, souvenirs and other related merchandise.
8. Our Target Market
One thing about Hot air balloon is that you only require less effort to market your service especially if your office is located in an area that is close to the beach. Although it is still important for you to create some form of advertisement to tell people what you do and it will pay you to partner with any hotel and resort that is close to you.
Even though Golan Heights® Hot Air Balloons, Inc. will initially serve limited numbers of passengers because of the few hot air balloons we have, but that does not in any way stop us from scaling up our services and growing to compete with the leading hot air balloon companies in the United States.
Our target market cuts across people of different class and from all walks of life. Below is a list of the people we have designed our products and services for;
- Potential Couples/Young Adults
- Schools (High Schools, Colleges and Universities)
- Sport Organizations (For Hot Air Balloon Competitions)
- Event Planners
- Travels and tours companies
Our competitive advantage
Because of the competitive nature of the hot air balloon business, there is an increasing degree of related business activities, with big players dominating the market.
We are quite aware that to be highly competitive in the sightseeing transportation industry means that you are not only expected to make available safe hot air balloon and professional hot air balloon pilots, but your price model must be flexible.
Our competitive advantage is anchored on the safe hot air balloons that we have. Also, we have a team of trained and experience workers. Aside from the synergy that exists in our carefully selected workforce, our services will be guided by international best practices in the industry.
Another strength that counts for us in the location of our company; it is located in one of the busiest beach communities highly suitable for such business in Newport Beach – California.
Lastly, all our employees will be well taken care of, and their welfare package will be among the best within our category in the industry. It will enable them to be more than willing to build the business with us and help deliver our set goals and achieve all our business aims and objectives.
9. SALES AND MARKETING STRATEGY
Our marketing strategies will be directed towards achieving specific objectives that support the strategic goals of the organization. All that we do will be geared towards creating new market channels, increasing sales and our market share.
We will leverage on improving on our services, turnaround time and facility to ensure that we win new clients and retain old clients as well.
Our sales and marketing team will be recruited based on their vast experience in Sightseeing transportation industry and they will be trained on a regular basis so as to be well equipped to meet their targets and the overall business goal of Golan Heights® Hot Air Balloons, Inc.
Golan Heights® Hot Air Balloons, Inc. is set to make use of the following marketing and sales strategies to attract clients;
- Open our hot air balloon business with a big party
- Offer free rides on our hot air balloons once in a while
- Advertise our hot air balloon on national dailies, local TV and radio stations
- Promote our hot air balloon online via our official website and all available social media platforms
- Introduce our business by sending introductory letters alongside our brochure to households, businesses and key stake holders in Newport Beach – California
- Print out fliers and business cards and strategically drop them in offices, sport facilities, libraries, public facilities and train stations et al.
- Deliver consistent customer experiences to all our members; making our first impression count positively to those that patronize our hot air balloons for the first time
- Make use of attractive hand bills to create awareness and also to give direction to our facility
- Adopt direct mailing coupon marketing approach
- Position our signage / flexi banners at strategic places in and around Newport Beach – California
- Create a loyalty plan that will enable us reward our consistent clients especially those that introduce their friends and family members to the business
- Engage on roadshows within our neighborhood to create awareness for our hot air balloon in our community.
Sources of Income
Golan Heights® Hot Air Balloons, Inc. is established with the aim of maximizing profits in the sightseeing transportation industry and we are going to ensure that we do all it takes to meet and surpass the expectations of our clients. Golan Heights® Hot Air Balloons, Inc. will generate income by offering the following services;
- Inshore/coastal hot air balloon transportation services
- Offshore hot air balloon transportation services
- Tournament hot air balloon rental services
- Commercial hot air balloon charter services
- Merchandise sales of hot air balloon related safety kits and souvenirs
10. Sales Forecast
One thing is certain, there would always be fun loving people and tourists who would want to go for sightseeing making use of balloon transportation especially during summer holidays.
We are quite optimistic that we will meet our set target of generating enough income / profits from the first six months of operation and grow our hot air balloon business to enviable heights. We have been able to examine the hot air balloon market, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast.
Below are the sales projections for Golan Heights® Hot Air Balloons, Inc. It is based on the location of our hot air balloon business and of course our target market;
- First Fiscal Year (FY1): $250,000
- Second Fiscal Year (FY2): $450,000
- Third Fiscal Year (FY3): $750,000
N.B: This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor offering same facility as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.
11. Publicity and Advertising Strategy
We have been able to work with our brand and publicity consultants to help us map out publicity and advertising strategies that will help us walk our way into the hearts of our target market.
We are set to become the number one choice for fun lovers in the whole of Newport Beach – California, which is why we have made provisions for effective publicity and advertisement of our business. Below are the platforms we intend to leverage on to promote and advertise Golan Heights® Hot Air Balloons, Inc.;
- Place adverts on both print (newspapers and magazines) and electronic media platforms
- Sponsor relevant community based events/programs
- Leverage on the internet and social media platforms like; Instagram, Facebook, twitter, YouTube, Google + et al to promote our hot air balloon rental services
- Install our billboards in strategic locations all around Newport Beach – California
- Engage in roadshows from time to time in targeted neighborhoods
- Distribute our fliers and handbills in target areas
- List our hot air balloon rental business in local directories / yellow pages
- Advertise our hot air balloon rental business in our official website and employ strategies that will help us pull traffic to the site.
- Ensure that all our staff members wear our branded shirts and all our vehicles are branded with our company logo.
12. Our Pricing Strategy
Our pricing system is going to be based on what is obtainable in the industry, we don’t intend to charge more (except for premium and customized services) and we don’t intend to charge less than what our competitors are charging their clients in Newport Beach – California.
Be that as it may, we have put plans in place to offer discount services once in a while and also to reward our loyal customers especially when they refer clients to us.
- Payment Options
The payment policy adopted by Golan Heights® Hot Air Balloons, Inc. is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.
Here are the payment options that Golan Heights® Hot Air Balloons, Inc. will make available to her clients;
- Payment with cash
- Payment via Point of Sale Machine (POS)
- Payment via online bank transfer
- Payment via check
In view of the above, we have chosen banking platforms that will enable our client make payment for renting our hot air balloons without any stress on their part. Our bank account numbers will be made available on our website and promotional materials.
13. Startup Expenditure (Budget)
Having done our due diligence, this is what it would cost us to set up Golan Heights® Hot Air Balloons, Inc. in the United States of America;
- The total fee for registering the business in the United States of America – $750.
- Legal expenses for obtaining licenses and permits – $1,500.
- Marketing promotion expenses (8,000 flyers at $0.04 per copy) for the total amount of – $10,000.
- The total cost for hiring Business Consultant – $5,000.
- The amount needed for the purchase of insurance policy covers (general liability, workers’ compensation and property casualty) coverage at a total premium – $30,800.
- The total cost for the purchase of accounting software, CRM software and Payroll Software – $3,000
- The total cost for leasing facility for the business – $60,000.
- The total cost for facility remodeling to fit into the type of hot air balloon facility – $30,000
- The total coats for financing the purchase of different sizes of hot air balloons and safety gadgets – $400,000
- Other start-up expenses including stationery – $1000
- Phone and utility deposits – $3,500
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $40,000
- The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, snooker board, tables and chairs et al) – $4,000.
- The cost of launching a Website – $600
- The cost for our grand opening party – $5,000
- Miscellaneous – $5,000
Going by the report from the market research and feasibility studies conducted, we will need about seven hundred and fifty thousand (750,000) U.S. dollars to successfully set up a medium scale but standard hot air balloon rental business in the United States of America.
Generating Funds/Startup Capital for Golan Heights® Hot Air Balloons, Inc.
Golan Heights® Hot Air Balloons, Inc. is a private business that is owned and financed by Mr. Garvey Mackeson and his immediate family members. They do not intend to welcome any external business partner which is why he has decided to restrict the sourcing of the startup capital to 3 major sources.
Since they are the sole financier of the business, they have decided to adopt the following means to generate startup capital for the business;
- Generate part of the startup capital from personal savings
- Source for soft loans from family members and friends
- Apply for loan from the bank
N.B: We have been able to generate about $250,000 (Personal savings $200,000 and soft loan from family members $50,000) and we are at the final stages of obtaining a loan facility of $500,000 from our bank. All the papers and documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.
14. Sustainability and Expansion Strategy
Part of the plans we have in place to sustain Golan Heights® Hot Air Balloons, Inc. is to ensure that we continue to deliver quality services, improvise on how to do things faster and cheaper.
From our findings, another factor that kills new business is financial leakages. In order to plug financial leakages, the management of Golan Heights® Hot Air Balloons, Inc. adopted the use of payment machine and accounting software to run the business.
We are quite aware that our customers are key component to the growth and survival of our business, hence we are going to continuously engage them to give us ideas on how to serve them better. We will not waste time in adopting new technology, best practices and diversifying our services; expand our product and service offerings once the need arises.
Our key sustainability and expansion strategy as a business is to ensure that we only hire competent and technically sound employees, create a conducive working environment and employee benefits for all our staff members. We know that if we implement our business strategies, we will grow our hot air balloon rental business beyond Newport Beach, California to other states in the U.S in record time.
- Business Name Availability Check: Completed
- Business Incorporation: Completed
- Opening of Corporate Bank Accounts: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Securing a standard facility and reconstructing the facility to fit into the kind of hot air balloon facility we want to manage: Completed
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Conducting Feasibility Studies: Completed
- Generating part of the startup capital from the founders: Completed
- Writing of Business Plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents: In Progress
- Design of Logo for the business: Completed
- Purchase of the required hot air balloons: Completed
- Printing of Promotional Materials: Completed
- Recruitment of employees: In Progress
- Purchase of the needed office furniture, office equipment, software applications, electronic appliances and facility facelift: In progress
- Creating official website for the business: In Progress
- Creating Awareness for the business: In Progress
- Health and Safety and Fire Safety Arrangement: In Progress
- Establishing business relationship with vendors and key players in various industries: In Progress