54430
ADVENTURE TOURISM
Resource Center for complex tourism services
Tajikistan
Market: Internet and IT, Entertainment, Tourism, sport, Services
Stage of the project: Prototype or product is ready
Date of last change: 14.10.2021
Tajikistan
Market: Internet and IT, Entertainment, Tourism, sport, Services
Stage of the project: Prototype or product is ready
Date of last change: 14.10.2021
Min amount of loan
$ 500.000
$ 500.000
Estimated yield
3 % a year
3 % a year
Idea
The uniqueness of the Project - will be established (build) Resource Center for Tourism (RCT), including a hotel and a training center with an area (territory) of more than 5000 m2. RCT will a national base of development and implementation for services (tours) and innovations in the field of extreme tourism in Tajikistan
Current Status
“Bunyod-Tour” is a licensed travel company (#0000002, from November 20, 2017) with more than 500 tour products; it has partnerships with more than 50 domestic and foreign organizations and has partnership with the State Committee on Tourism Development under the Government of the Republic of Tajikistan on domestic tourism. The company is a member of the РАТА (Pacific Asia Travel Association). For today our main services are - tours, hotel reservations, transfers, flights, visa support, tours on credit, gift certificates, etc.
In a short period, the company has reached annual turnover in the amount of $ 100,000, so we have high rate of profitability. There is a land available (10 ha) for construction of the Resource Center for Extreme Tourism (it’s in the legalization process). This decision was made because of review of the global extreme tourism market, to provide quality and safe service to tourists and competitive advantage in the region, since no such a center available in Tajikistan.
In a short period, the company has reached annual turnover in the amount of $ 100,000, so we have high rate of profitability. There is a land available (10 ha) for construction of the Resource Center for Extreme Tourism (it’s in the legalization process). This decision was made because of review of the global extreme tourism market, to provide quality and safe service to tourists and competitive advantage in the region, since no such a center available in Tajikistan.
Market
According to UNWTO, the potential market for travel services in the world in 2018 (PAM) amounted to $1.7 trillion and has a stable annual growth of 5-7% (2017- $ 1.3 trillion).
While, in Tajikistan, the tourism services market (TAM) has more regressive dynamics (data from the Statistics Agency under the President of the Republic of Tajikistan):
• 2018 - $ 499.2 million (400 thousand visits / tourists)
• 2019 - $ 1,305 million (1.1 million visits / tourists)
• 2020 - $ 511,2 million (410 thousand visits / tourists) – within the negative effects of COVID-19
A sharp increase of the tourism market in Tajikistan – 275%, primarily has an economic and political character in two aspects: 1) Government support for the sector - 2018 was declared the Year of Tourism and Handicraft Development (this initiative was continued for another three years - until 2021); and 2) Development of diplomatic relations with the countries of the region, including with Uzbekistan - 9 border crossing points have been opened, which will allow tourists to simultaneously visit two states.
As Tajikistan is a mountainous country and in terms of water (drinking) resource occupies the 8th place in the world, the country’s extreme tourism market (SAM) accounts for more than 35% of the total market share, and it equates to $ 440,900,000. The proportion of the Project’s share (SOM) in the market of affordable tourism services (calculated over a 5-year implementation period, including one year for construction) is $ 8,000,000 per year or 1,8% of the market.
Moreover, a significant factor is annual population growth – 2%, and their purchasing power dynamic growth is 20%.
While, in Tajikistan, the tourism services market (TAM) has more regressive dynamics (data from the Statistics Agency under the President of the Republic of Tajikistan):
• 2018 - $ 499.2 million (400 thousand visits / tourists)
• 2019 - $ 1,305 million (1.1 million visits / tourists)
• 2020 - $ 511,2 million (410 thousand visits / tourists) – within the negative effects of COVID-19
A sharp increase of the tourism market in Tajikistan – 275%, primarily has an economic and political character in two aspects: 1) Government support for the sector - 2018 was declared the Year of Tourism and Handicraft Development (this initiative was continued for another three years - until 2021); and 2) Development of diplomatic relations with the countries of the region, including with Uzbekistan - 9 border crossing points have been opened, which will allow tourists to simultaneously visit two states.
As Tajikistan is a mountainous country and in terms of water (drinking) resource occupies the 8th place in the world, the country’s extreme tourism market (SAM) accounts for more than 35% of the total market share, and it equates to $ 440,900,000. The proportion of the Project’s share (SOM) in the market of affordable tourism services (calculated over a 5-year implementation period, including one year for construction) is $ 8,000,000 per year or 1,8% of the market.
Moreover, a significant factor is annual population growth – 2%, and their purchasing power dynamic growth is 20%.
Problem or Opportunity
Tajikistan is a land of the highest mountain peaks, giant glaciers, stormy rivers and lakes that are unique in their beauty, rare animals; it has huge tourist resources, most of which have not yet been touched by humans. 93% of the country is made up of mountains with a height of up to 7.5 thousand meters from sea level (the highest point in Europe and the CIS). However, the potential of the tourism sector is very weak, there are more than 160 companies operating in the country and 70% of them are at the start-up stage
Weak base – weak technic opportunity / conditions to reception, accommodation, preparation (training, instruction), guiding and safety (providing insurance) for adventure tourists
As mentioned above, the government of Tajikistan has identified the tourism sector as a priority area of the economy and set the goal by 2025 - to increase the tourism market by 7% of GDP (more than $ 4 billion). Consequently, the relevant legislative preferences have been introduced in the country:
• Simplified visa regime - electronic visa for 112 countries of the world and obtaining a visa at the airport for up to 45 days;
• Income from tourism activities of new companies is exempted from income tax (6%) for 5 years from the moment of state registration, Tax Code of the Republic of Tajikistan (article 110);
• Exempted from value added tax (25%) the import of equipment, machinery and building materials for tourist facilities (including hotels, medical sanatorium and resorts, tourist centers and other tourist facilities) Tax Code of the Republic of Tajikistan (article 169).
Weak base – weak technic opportunity / conditions to reception, accommodation, preparation (training, instruction), guiding and safety (providing insurance) for adventure tourists
As mentioned above, the government of Tajikistan has identified the tourism sector as a priority area of the economy and set the goal by 2025 - to increase the tourism market by 7% of GDP (more than $ 4 billion). Consequently, the relevant legislative preferences have been introduced in the country:
• Simplified visa regime - electronic visa for 112 countries of the world and obtaining a visa at the airport for up to 45 days;
• Income from tourism activities of new companies is exempted from income tax (6%) for 5 years from the moment of state registration, Tax Code of the Republic of Tajikistan (article 110);
• Exempted from value added tax (25%) the import of equipment, machinery and building materials for tourist facilities (including hotels, medical sanatorium and resorts, tourist centers and other tourist facilities) Tax Code of the Republic of Tajikistan (article 169).
Competitors
According to the data of Tourism Development Committee there is no analogue of our Project in Tajikistan, however, several companies (about 10) providing separate services in the field of extreme tourism.
Our main competitive advantage is that: we provide a range of travel services, starting from theory (instruction, training) and to practice - achieving results; our services have a wide selection, both in a complex and separately; our products are low priced - we provide them, taking into account our own capabilities (hotel, training center), including technical resources (vehicles, equipment, etc.); we are applying the principle of manufacturability of products - online booking, online payment, tours on credit, etc. These products / services are not provided by our competitors.
The following relatively strong competitors may be considered in the market (however, with limited types of products):
А) PAMIR PEAKS
This company has been on the market for more than 15 years; provides tours mainly in alpinism and trekking. The company is famous with its brand - has clients from around the world. In yearly base, the company sells 60-70 products with a turnover of about $ 300,000.
Point is that the alpinism is a seasonal business; therefore, its need to have good potential to attract more customers during the season. Pamir is famous for its brand “Roof of the World” with a height of up to 7500 meters from sea level – this is the highest peak in Europe and the CIS.
That is mean the main problem of the company is a weak technical and personnel potential of company; the classical method of monetization and the limitations on one type of tourism.
B) PAMIR CENTRAL ASIA
Company has a good Brand, recognized among customers. As the logotype of company implies, the company supposed to provide hunting tours, but the company was practically not engaged in hunting; the main tours are trekking, hiking and excursions into Pamir region in connection of the countries such Uzbekistan, Kirgizia, and Kazakhstan. The annual turnover of company is about $ 200,000 in sales. This amount would be sold in just 20 products (trophy).
In Tajikistan, as well as in the world, a Marco Polo sheep is known as argali, arkhar; it is considered the largest representative of the mountain wild sheep family. Every year, the Government allocates more than 90 quotas for hunting this type of sheep. The cost of one trophy is more than $ 30,000.
Based on this, it can be concluded that the main problem of the company is a weak technical and personnel potential, classical method of monetization and incorrect marketing, including branding.
Our main competitive advantage is that: we provide a range of travel services, starting from theory (instruction, training) and to practice - achieving results; our services have a wide selection, both in a complex and separately; our products are low priced - we provide them, taking into account our own capabilities (hotel, training center), including technical resources (vehicles, equipment, etc.); we are applying the principle of manufacturability of products - online booking, online payment, tours on credit, etc. These products / services are not provided by our competitors.
The following relatively strong competitors may be considered in the market (however, with limited types of products):
А) PAMIR PEAKS
This company has been on the market for more than 15 years; provides tours mainly in alpinism and trekking. The company is famous with its brand - has clients from around the world. In yearly base, the company sells 60-70 products with a turnover of about $ 300,000.
Point is that the alpinism is a seasonal business; therefore, its need to have good potential to attract more customers during the season. Pamir is famous for its brand “Roof of the World” with a height of up to 7500 meters from sea level – this is the highest peak in Europe and the CIS.
That is mean the main problem of the company is a weak technical and personnel potential of company; the classical method of monetization and the limitations on one type of tourism.
B) PAMIR CENTRAL ASIA
Company has a good Brand, recognized among customers. As the logotype of company implies, the company supposed to provide hunting tours, but the company was practically not engaged in hunting; the main tours are trekking, hiking and excursions into Pamir region in connection of the countries such Uzbekistan, Kirgizia, and Kazakhstan. The annual turnover of company is about $ 200,000 in sales. This amount would be sold in just 20 products (trophy).
In Tajikistan, as well as in the world, a Marco Polo sheep is known as argali, arkhar; it is considered the largest representative of the mountain wild sheep family. Every year, the Government allocates more than 90 quotas for hunting this type of sheep. The cost of one trophy is more than $ 30,000.
Based on this, it can be concluded that the main problem of the company is a weak technical and personnel potential, classical method of monetization and incorrect marketing, including branding.
Advantages or differentiators
The uniqueness or competitiveness of the Project lies in the fact that we will establish (construction) Resource Center for Tourism (RCT), including a hotel and a training center with an area (territory) of more than 5000 m2, which is a base of comprehensive services (tours) and innovations in the field of tourism
The Project was agreed with the State Committee for Tourism Development under the Government of the Republic of Tajikistan, and it will be in the west of Tajikistan, in a mountainous region where tourists can be acclimatized, get all the necessary services, instruction and prepare for extreme tours. Also, this is going to be a place where tourists can apply almost all types of extreme tours, from training to practice.
RCT allows the flow / import of tourists not only for the Project, but also for other tourism companies in Tajikistan. Bunyod-Tour will provide its services and resources using the B2B method, including the capabilities of the RCET to other companies in the country to sell their products.
The Project was agreed with the State Committee for Tourism Development under the Government of the Republic of Tajikistan, and it will be in the west of Tajikistan, in a mountainous region where tourists can be acclimatized, get all the necessary services, instruction and prepare for extreme tours. Also, this is going to be a place where tourists can apply almost all types of extreme tours, from training to practice.
RCT allows the flow / import of tourists not only for the Project, but also for other tourism companies in Tajikistan. Bunyod-Tour will provide its services and resources using the B2B method, including the capabilities of the RCET to other companies in the country to sell their products.
Finance
We are using modern methods of tour implementation such as online service custom tours, online payment, professional services, transfers, credit tours, gift certificates, etc. All these services providing in both - complex, and separately; and so, anyone / client has a choice in our company.
The main contingent of our customers and partners reaches (attracted) through the internet. We have two sites and various accounts in social networks such as Facebook, Twitter, Instagram, Ok, Vk. The diversity of accounts assumes the diversity of the audience; Russian-English pages have been issued for foreign citizens and Tajik-Russian pages for local citizens. This approach allows providing addressed services considering real needs of targeted groups. Moreover, we have partnerships with international internet companies such as Aviasales.ru, Booking.com, Hotelspro, Travelpayout, Alean.ru that allows providing customers with a large selection and a highly rated product. As a result of this approach, most of our customers returning for purchases twice in a year. Our agreements with foreign companies on international tourism allow us to realize tours both domestically and abroad. Customers are more committed to companies that have partners abroad.
Method - corporate service is the sustainable method of our company; the agreements were signed for the provision of tourism services by the Committee on Tourism Development under the Government of Republic of Tajikistan, the Handball Federation of Tajikistan, the National Association of Volunteers, Shark Insurance Company, etc. and this approach for the current year allowed increasing the turnover of “Bunyod-Tour” by 300%.
The main contingent of our customers and partners reaches (attracted) through the internet. We have two sites and various accounts in social networks such as Facebook, Twitter, Instagram, Ok, Vk. The diversity of accounts assumes the diversity of the audience; Russian-English pages have been issued for foreign citizens and Tajik-Russian pages for local citizens. This approach allows providing addressed services considering real needs of targeted groups. Moreover, we have partnerships with international internet companies such as Aviasales.ru, Booking.com, Hotelspro, Travelpayout, Alean.ru that allows providing customers with a large selection and a highly rated product. As a result of this approach, most of our customers returning for purchases twice in a year. Our agreements with foreign companies on international tourism allow us to realize tours both domestically and abroad. Customers are more committed to companies that have partners abroad.
Method - corporate service is the sustainable method of our company; the agreements were signed for the provision of tourism services by the Committee on Tourism Development under the Government of Republic of Tajikistan, the Handball Federation of Tajikistan, the National Association of Volunteers, Shark Insurance Company, etc. and this approach for the current year allowed increasing the turnover of “Bunyod-Tour” by 300%.
Loan terms
60 months
Interest rate, %
3
Business model
Our products (for today) - is the organization of tours: cultural-historical and one-day excursions (revenue-50%); international tours, tours abroad and attracting foreign citizens (revenue-20%), transfer-transport service, air tickets (revenue-20%), logistics service - organization of corporate events / tours (revenue-10%). In 2019, 955 tour products were sold; average bill is $ 70
Solution (product or service)
Within the Project will be established a Resource Center for Tourism (RCT), including a hotel and a training center with an area of more than 5,000 m2 – this is the base of comprehensive tourist services (tours) and innovations in the field of tourism such as accommodation, preparation (training, instruction), escort and safety guarantee (insurance) for extreme tourists. In the project's boundaries / RCT a unique and popular product in Central Asia will be released, such as mountaineering; rock climbing; trekking (mountain hike); hunting for wild animals; rafting; skydiving; balloon tour (aeronautics); hang glider tour.
The project was approved by the State Committee for Tourism Development under the Government of the Republic of Tajikistan.
The project was approved by the State Committee for Tourism Development under the Government of the Republic of Tajikistan.
Team or Management
Risks
Consider the fact that the sphere of tourism in the Republic of Tajikistan determined as priority area for the Government for the economy development the extent of risk is reduced to minimum. Despite of this there is a probability of certain risks which arise in conditions of market fluctuation and force majeure.
1) Not reaching the break-even level in case of passive involvement of potential consumers
Consider this risk, there:
will be carried out a lot of information and communication and advertising campaigns among potential consumers, including through competitions, the use of media resources (advertising at TV channels) and the Internet network;
will be established cooperation with the foreign tourist companies / associations in mutually beneficial conditions;
also, will be applied motivational technologies, a flexible system of discounts for regular customers, which will increase their loyalty to us.
2) Failure to obtain quotas for the tours for some extreme tours
Consider this risk, there will be provided the necessary information about the company preliminary to the State authorized body, as well as with the local and authority organizations will be signed an agreement on cooperation, including a guarantee of providing permits in advance, that is, early booking of permits. Furthermore, the Government of Tajikistan will be informed early about Project.
3) Incongruity of weather conditions for travel
Consider this risk, there will be established a constant communication with the local subjects on Metrology and the weather conditions will be determined in advance. And, at the conclusion of the contract, this situation will be included as a force majeure, that is, the tourist will be notified about it earlier, that the weather is changeable
1) Not reaching the break-even level in case of passive involvement of potential consumers
Consider this risk, there:
will be carried out a lot of information and communication and advertising campaigns among potential consumers, including through competitions, the use of media resources (advertising at TV channels) and the Internet network;
will be established cooperation with the foreign tourist companies / associations in mutually beneficial conditions;
also, will be applied motivational technologies, a flexible system of discounts for regular customers, which will increase their loyalty to us.
2) Failure to obtain quotas for the tours for some extreme tours
Consider this risk, there will be provided the necessary information about the company preliminary to the State authorized body, as well as with the local and authority organizations will be signed an agreement on cooperation, including a guarantee of providing permits in advance, that is, early booking of permits. Furthermore, the Government of Tajikistan will be informed early about Project.
3) Incongruity of weather conditions for travel
Consider this risk, there will be established a constant communication with the local subjects on Metrology and the weather conditions will be determined in advance. And, at the conclusion of the contract, this situation will be included as a force majeure, that is, the tourist will be notified about it earlier, that the weather is changeable
Incubation/Acceleration programs accomplishment
No, we have not
Won the competition and other awards
No, we have not
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Product Video
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