Business Model and Innovative Initiatves for the Ruggard Hay Hotel

The Business Model Canvas, developed by Osterwalder, can be applied to the Ruggard Hay Hotel. The Business Modell consists of 9 elements that need to be considered:  key partners, key activities, key resources, value proposition, customer relationships, channels, customer segments, cost structure and revenue streams.

Key partners
It is an advantage if you have partners and build up a local network, so that all can profit from each other. That the family knows the owner of the Bindeballe Kobmansgaard and Bindeballe Station, and that they would like to corporate with them is a good foundation to build up a network. Additionally, it would be helpful to find some other key partners to strengthen this network. Therefore, they may develop a partnership with Legoland, restaurants, canoe rentals and stores in the area.

Key activities
They need to consider what is necessary to run the business and to realize their dream of the B&B. Before new guests arrive the apartments have to be prepared and cleaned. They will probably do it by themselves and let the guests pay for the final cleaning. The room upstairs also needs to be cleaned. This is a little bit more difficult, since almost all the time somebody will be there. Therefore, a time during the day, when most of the guests are on a tour  would be good to do some cleaning.
Another key activity is the Check-in/out and payment. If both of them are working fulltime, it would probably the best if the guests can pick up the key for the apartment at a neighbours house, e.g. a retired couple or neighbours that work from home.
How can people pay for the accommodation? Just offer to pay in cash can be difficult, because many people do not like to carry around much money. Therefore, they should buy a card reader.
The idea of the family is to open a B&B and therefore, offer breakfast to their guest. It would be a nice idea to offer some local food for breakfast. Maybe they know some farmers where they can buy eggs, jam etc.
Another main activity is the guided tours that they would like to offer. Either they offer it by a schedule or on demand. They probably do not need additional stuff, since Christopher, Lisbeth and the oldest daughter would do the guided tours.

Key resources
The family’s idea is to run a family business. Without any employees there is more work that has to be done by the family. Christopher and Lisbeth want to involve their children in the business.

Value Proposition
The Ruggard Hay Hotel has a quite a few values to offer.
One of them is the nature – the beautiful landscape. It is perfect for exploring the nature by horse, bike or even by foot. It is outside the busy city, in a rural area. Therefore, it is also great if you would like to relax and enjoy the silence. Another value is fun, which can be offered by the family through the guided tours. In the area are nice riding trails. Additionally, the family needs to build up fences for horses, to enable their guests to have some breaks during their tours.
The family is very friendly and welcoming, and can therefore provide a personal and familiar atmosphere for their guests. It is a value that is for some people really important and desired.
To offer their guest an unforgettable experience, the family also wants to offer lunch and coffee arrangements.
Customer segments
To reach the right target group it is important to find out who is the target group. In this case there are basically four target groups: the Icelandic horse riders (with/or without horses), mountain bikers, guest that want to escape the daily life and relax in the nature, and guests that would like to visit e.g. Legoland or Lalandia.
Christopher and Lisbeth would like to have the main focus on the Icelandic horse riders, because the Icelandic horses are their passion. By offering the guided tours just to people that will bring their own horses, they reduce the target group. There are many families that would like to go on a holiday on a farm where their children can do horseback riding. A suggestion would be that they buy 2-4 horses that their guest can ride. This would not limit the target that much.
Mountain bikers are another target group. Maybe Christopher can also do some tours with them, since he knows the area very well and enjoys riding his bike. I assume that this target group will not generate the most income, because in average they will not stay that long and will pay less for their sleeping place.
Many people are stressed and want to escape their work day. This is a target group that could also be interesting for the family, since they can offer a nice apartment in a beautiful and calm landscape.
There are also families that look for place to stay when they want to visit Legoland or Lalandia for example. Probably this is a target group that would like to do their own activities. They will not have this personal relationship with the family. But the family should also consider this target group.

Thinking about the right channels, can make it much more easier to reach the right target group. They should definitely use the Danish Icelandic Horse Association as a channel. Furthermore, they should list their hotel on the website, to reach the families that would like to go to Legoland etc. An own website it also quite important so that you can find the hotel when you search on google for a place to stay in Denmark.

Revenue streams
A minimum revenue per year of DKK60,000 should be achievable. Additional they can make profit through the offered tours and lunch arrangements.

Cost structure
Lisbeth and Christopher think that they only have to do small investments. According that we do not know if they would like to build an additional bathroom and kitchen, an extra or bigger stable and if it is allowed to build up the fences for the horses on the different places, I cannot evaluate how big the investments will be. But I guess it will not just be money for kitchen equipment and furniture.

Customer Relationship
Customer relationship is really important for a good reputation. The idea that guests can only book by calling is a little bit old-fashioned. For people from abroad can it be really expensive. Additionally, Christopher and Lisbeth are working full-time, so it can be a problem to answer calls. They should allow guests to book online.

On the basis of the attractor based innovation model, which consists of the attractor, attraction, scene, scene-taker and scene-maker, it is possible to support the business model.
The Kjaer family offers the guided tours in this beautiful area. Furthermore, they could think about some additional events that they can offer for their guest, for example a guided horse tour for children where they dress up as Indians , have an overnight stay in a tent and make a campfire.
The scene-maker puts the idea into practice. This would be in this case the family by doing the guided tours, but this can also be some locals which provide a place for the tents and some food for the campfire.

Leave a Reply

You must be logged in to post a comment.