KLC Lakeside Rentals

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KLC Lakeside Rentals

• ELC 310
• Presented By Karen Pelletier

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Company Description

• KLC Lakeside Rentals, LLC is newly formed rental
  business which is ideally located along Long
  Lake. It has been renting and serving the needs
  of people since 2007 and it is currently
  expanding. Although it is currently producing
  enough revenue to cover the cost of purchasing
  the property and improvements it is expanding in
  size and also in marketing and advertising
  techniques.

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• The company is named after the founders
  children (Karen, Lance, Clint). The reason for
  naming the company after his children was for the
  purpose of having this company as a family
  business for possible years to come. The plan was
  to start out small and test out the waters to see
  the potential of the company and the possible
  number of customers.

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• Although there is plenty of competition in camp
  rentals KLC Lakeside Rentals realized there is
  some opportunity and potential for what they have
  to offer.

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Construction

• The main house can comfortably accommodate over a
  dozen people at one time
• It is a two story house that measures 3,500
  square feet total
• It has a large open layout with stainless steel
  appliances
• A second bathroom was added and a porch on the
  top floor with sliding glass doors was also added
• On the outside of the house there was some
  landscaping and the siding was updated to a dark
  blue cemplank
• Large garage is currently being constructed into
• second rental unit

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Situational AnalysisSWOT Analysis

• Strengths
• Successful existing business with repeat
  customers
• Ideally located on the lake
• Walking distance to a restaurant, golf course,
  and bar
• Located next to four-wheeler/snowmobile trails
• Great communication/relationships with customers

• Weaknesses
• New venture
• No prior experience in this field
• Budget Limitations
• Time constraints
• Lack of focus on advertising

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• Opportunities
• Development of other tourist attractions nearby
• Recent development of nearby boat rental company
• Word of mouth from past renters
• Fishing Derby on Long Lake
• Other events/activities in nearby towns
• Fermata (Strategic Plan for Economic Development
  through Nature Tourism)

• Threats
• Competition from other rental companies
• Regulatory threats for lake use or for rental
  businesses
• The local population is declining
• Poor economic conditions in local area (threat of
  mill closing)

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MOA Analysis

• Demand Analysis
• Nature-based tourism is a vital component of
  Maines economy and there is a big demand for
  renting in this type of location.
• KLC Lakeside Rentals knows that they have quite
  a bit of demand and competition but their goal is
  to stand out above the rest by the quality of
  their service. Basically anyone who owns land can
  rent property, but there are not many which are
  ideally located, which can accommodate so many
  people and the difference is how KLC Lakeside
  Rental accommodates people.
• The FERMATA study has determined that the
  number of lodging facilities in each of the three
  study regions (Washington County, Maine
  Highlands, Western Mountains) is adequate for the
  number of new visits anticipated however, the
  quality of existing lodging facilities is not up
  to the level expected by the targeted
  "experiential" traveler. 1
• 1 http//www.mainewoodscoalition.com/pcnews/10.h
  tml

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Segment Analysis

• The customers of KLC Lakeside Rentals include
  anyone who is looking for a vacation and a piece
  of heaven while not having to sacrifice the
  amenities of being away from home. KLC Lakeside
  Rentals does not offer you a camp like setting
  it offers you a home away from home in the serene
  Northern Maine. We can accommodate large crowds
  because of the space we have and it is the
  perfect place for gatherings.
• Family gatherings
• Wedding receptions
• Reunions
• Hunting/Fishing/Snowmobiling trips with large
  crowds

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Market Demographics

• Geographics
• People with family ties to the region
• People who have previously lived in this area or
  an area similar to it
• People who have previously visited the area
• Demographic Characteristics
• People of any age, sex, or race
• On average more men rent in general especially is
  large crowds (hunting, fishing, and snowmobiling
  crews)
• Most people have a moderate to higher income
  levels
• Psychographics
• People who are big spenders
• People who want to have fun or relax without
  giving up their normal commodities that they have
  at home
• People who love or enjoy the outdoors (fishermen,
  hunters, snowmobile riders, ATV riders)

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Supply (competition) Analysis

• The current competition is large for such a small
  area.
• Many people rent out their own camps for a few
  weeks out of the year to generate a profit to
  cover the expense of owning it.
• Some people make a living out of fixing and
  renting out lakeshore property.
• There is such strong competition that people will
  undercut other businesss prices to attract their
  customers
• That is why it is crucial to differentiate and
  market KLC Lakeside Rentals from the rest.

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Product Strategy

• Competitive Advantage
• Setting our company and our service from the
  rest is crucial. It is also crucial to keep our
  customers happy because there is plenty of
  competition. One way to have a competitive
  advantage is through the use of the internet.
  Many rental companies in this area are not using
  the internet and other technology to get the word
  out. If our business uses the internet and other
  technology for our advantage then we can be one
  step ahead of the game.

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Location, Location, Location!

• Another competitive advantage is its location
• Next door to golf course
• Next door to year round restaurant/bar
• Access to lake/snowmobile/fourwheeler trails

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Features of the Rental

• Some features of the rentals
• Large parking lot
• Storage on site
• Two docks for use
• Large lawn
• Swing set on back lawn
• Comfortably fits a dozen or more people
• Dishwasher
• Washer/dryer
• Satellite television
• Unlimited long distance phone
• Multiple bedrooms/bathrooms
• Many different sizes of beds to choose from
• Stainless steel appliance
• Newly remolded
• Towels and bedding are furnished

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Goals

• It is necessary for the company as a whole to
  have financial as well as non-financial goals.
• The main goal is to look for opportunities and
  expand when deemed necessary
• By 2020 pay off the major expense of the mortgage
  and construction
• Increase advertising
• Future expansion after major expenses have been
  paid off
• Steady increase of rentals at least 10 per year
• Finish new addition by Spring 2008
• Once new addition is finished increase rentals to
  a minimum of 40 yearly by 2009

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E-Marketing

• As KLC Lakeside Rentals expands it is necessary
  for their advertising and marketing to also
  expand and to focus more on e-marketing.
• Current advertising/marketing
• Online through free advertising and listing
  websites that is solely for the state of Maine
• Business cards have been placed at many local
  businesses that attract tourists
• Word of mouth from past renters
• Non-interactive website which is mainly for
  pictures

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• Future marketing/advertising
• Advertising on ATV, snowmobiling, hunting, and
  fishing magazines and websites to attract that
  demographic to our website
• New website that is interactive
• List the many amenities and features that set KLC
  Lakeside Rentals from the rest
• Detailed pictures of the inside and outside
• A form to directly send an email to the host if
  they have any questions or special requests
• An interactive map in which they see exactly
  where KLC Lakeside Rentals is located and to get
  directions
• A guestbook for people who have stayed at the
  rental to tell others about their experience
• People who have posted on the guestbook will get
  a 10 discount off their next rental

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• The website will include a feature for customers
  to pay their deposit right on the website to
  reserve their week
• When customers use this feature it will
  automatically send them an email thanking them
  for their business. In that email it will also
  send them an electronic receipt so they can keep
  it for their records.
• Include a calendar to show what weeks are
  available for renting
• Calendar of special events that are taking place
  in nearby towns (fishing derby, acadian festival,
  etc)
• Detailed information on the pricing
• It will have dynamic pricing. Some seasons and
  months vary in demand so for the months with the
  decreased demand the price will be lower to
  attract people to rent.

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Implementation Plan

• KLC Lakeside Rentals hopes to achieve these
  significant milestones in the next few years
  which are outlined below
• Finalize pricing strategy Fall 2007
• Create a professional looking website Winter 2007
• Create brochures/ business card to direct
  customers to website Winter 2007
• Expand advertising to target markets (snowmobile,
  fishing, hunting magazines and websites) Winter
  2007
• Finish construction by Spring 2008
• Advertise before/during Fishing Derby on Long
  Lake Winter 2008

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Budget

• Major costs include the cost of acquiring the
  initial building and property and the expansion
  and construction of the new rental unit
• Operational expenses include the general upkeep
  which includes the electricity, oil, toilet
  paper, etc.
• Satellite television, internet, and telephone
  cost a couple hundred dollars monthly but it was
  the result of customer requests and to set our
  service apart from the rest
• Although it increased the overhead cost to
  transform the garage into a new rental unit the
  total costs of acquiring the property and the
  construction is paid off in a much shorter period
  of time.

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Monthly Budget

• Mortgage 1300
• Insurance 60
• Taxes 240
• Heating 200
• Electricity 110
• Maintenance etc. 75
• Trash removal 40
• Lawn care/snow removal 100
• Satellite Tv 60
• Telephone 110
• Internet 40
• Supplies 60
• Advertising 50
• Website 50
• Total monthly expense 2495

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• The breakdown of the monthly expenses reveals
  that to break even we would need to rent on three
  different occasions at the cost of 850 per week
  in a month or 35 times within a year. These
  results would not seem as promising but since the
  new construction we are able to rent twice as
  much as before although it costs more up front.
  Once the cost of the mortgage and construction is
  paid off (1300 monthly) then the costs per month
  will be cut in half and there will be an
  increased net profit.

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Evaluation Plan

• The best way to evaluate the company and how it
  is doing is by getting the answers straight from
  the customers.
• Through the advice of previous renters we have
  added and changed a few things
• Another way of evaluating the company as a whole
  is to keep track of the number of rentals by
  month and by year to see how the company is
  doing.
• The company plans on being flexible to the needs
  of customers to better serve them.