Business Pod 1.2: Forsyth Travel Investment Pitch Project

This assignment is an investment pitch for Forsyth Travel, a business founded by Julia and Tim Forsyth. The pitch outlines the company's history, current business overview, and financial performance from 2014 to 2017, including the prices and sales of luxury and standard apartments. It details future targets for 2018, including planned strategies such as maintaining standard apartment prices, increasing luxury apartment prices, and focusing on marketing. The pitch includes projected fixed and variable costs, financial outcomes for 2018, break-even points, and a net profit projection with a return on capital employed (ROCE) calculation. Additionally, it explores long-term opportunities like rental income from a café and available basement space. The assignment aims to secure an investment of €600,000 from a potential investor by presenting a clear financial plan and demonstrating the potential return on investment.

Forsyth Trave
INVESTMENT PITCH

Forsyth Travel History
Founded by Julia and Tim Forsyth in 2015
Sells self-catering apartments at Storatet
Apart hotel in Floen
Tim is a Search Engine Optimisation Expert
Julia handle the position of Sales Manager
FORSYTH TRAVEL
FORSYTH
TRAVEL

Current Business Overview
12 Luxury Apartments
25 Standard Apartments
Weekly basis sales
Run operations 46 weeks a year

Current Financial Performance
Price 2014 2015 2016 2017
Luxury 1625 1950 2100 2225
Standard 575 625 590 575
2014 2015 2016 2017
0
500
1000
1500
2000
2500
Price of Luxury and Standard Apartment from
2014-2017
Luxury
Standard

Current Business Sales
Apartme
nt sold 2014 2015 2016 2017
Luxury 1625 1950 2100 2225
Standard 575 625 590 575
2014 2015 2016 2017
0
100
200
300
400
500
600
700
800
900
Number of Luxury and Standard
Apartment sold from 2014-2017
Luxury
Standards
Occupanc
y rates 2014 2015 2016 2017
Luxury 88.77% 94.20% 96.01% 100.00%
Standards 78.26% 76.52% 75.22% 73.91%

Future Target
Target: To sell 900 Standard
Apartments on a weekly basis during
2018

Planned Strategies
Keep Standard Apartment price constant to
2017
Increase sales price for Luxury apartments
by 7.5%
Focus on marketing to drive more demand
More focus on quality and extra services in
the standard apartment

Projected fixed cost Structure
Amount
Marketing £ 85,000.00
Office rent £ 14,000.00
Salaries (including NI, outsourced payroll, etc) £ 200,000.00
Depreciation £ 1,700.00
Travel and subsistence £ 15,000.00
Office sundry items £ 1,250.00
£ 316,950.00

Projected Variable cost
Luxury Apartment: GBP400
Standard Apartment: GBP 55

Projected Financial outcome for 2018
Occupancy rates:
Luxury: 100%, 552 Apartments
Standard: 78%, 900 Apartments

Break-Even Points for 2018
Luxury Standard
TFC £102,795 £214,155
Selling price £2,392 £575
Variable cost £400 £55
Contribution £1,992 £520
Break-Even Point
(Units) 52 412

Projected Profit for FY 2018
Amount
Total sales £ 1,837,884.00
Total variable cost £ 1,006,300.00
Contribution £ 831,584.00
Less: Total Fixed cost £ 316,950.00
Net profit for the year £ 514,634.00

Return on Capital employed
ROCE = Net profit/Total Capital Employed
*100
= 514,634/600,000
= 85.77%

Other Opportunities in Long-run
Rental Income from Café
Availability of basement space
 Business space which is currently provided
to guests

Bibliography
http://www.investinganswers.com/financial-
dictionary/technical-analysis/return-
investment-roi-1100
https://www.thebalance.com/how-to-
calculate-breakeven-point-393469