THEME PARK REPORT-2017

TRC Inc. 2017 Analysis

PREPARED BY ZHAOLONG WANG

STUDENT AT COLLEGE OF DUPAGE

Prepared for Writing for the Workplace

ENGLI-1105-010
 Theme Park Report-2017 1

Transmittal
To: TRC Inc.
Subject: Theme park report

I am glad to be able to provide a "Theme Park Report -2017" today. This report contains
the feasibility of building a new theme park for TRC Inc. and the potential profits to our
company. The report provides some reference data from the statistics of US theme parks:
revenue, costs, attendance, job creation, and competitors. Based on the projections of
these statistical trends, we can conclude the feasibility of building a new theme park in
the current U.S. market.

A theme park will undoubtedly have a massive impact on the local economy. It cannot
only attract tourists, but also provide employment opportunities to help someone in
urgent need of further regional development (restaurants, holiday businesses) and
increase local taxes, which are conducive to the government to support any other city
service provides TRC Inc. with the information it needs to evaluate the feasibility of
building a new theme park.

If I can answer any future questions, please feel free to contact me by email
wangz173@dupage.edu or phone at (630)-123-1234.

Zhaolong Wang
Zhaolong Wang
Student of College of DuPage
Wangz173@dupage.edu
 Theme Park Report-2017 2

ABSTRACT
Building a theme park is a solution that can provide thousands of jobs and helps to
reverse the current economic conditions. This report assesses a theme park will
undoubtedly have a massive impact on the local economy. It can not only attract tourists
and get tourist dollars, but also provide employment opportunities to help some in urgent
need of further regional development. Businesses) and increase local taxes, which are
conducive to the government to support any other city service. It examines not only the
economic impact of a theme park but also the cost of building a theme park. Therefore,
creating a theme park is not just about assisting company to get the benefits, but it can
also drive the economic growth in Illinois and increase the company's presence in the
community.
 Theme Park Report-2017 3

Table of Contents
ABSTRACT.......................................................................................................................... 2
EXECUTIVE SUMMARY ................................................................................................ 4
INTRODUCTION ........................................................................................................ 5
Cost .............................................................................................................................. 6
Revenue ........................................................................................................................ 7
Admissions, rides, and game ....................................................................................... 7
Food and beverages..................................................................................................... 7
Merchandise ................................................................................................................ 8
Attendance ................................................................................................................... 8
Internal and External Factors ..................................................................................... 9
Job creation ............................................................................................................... 10
Expected growth ........................................................................................................ 10
 Theme Park Report-2017 4

EXECUTIVE SUMMARY
This report examines the feasibility of building a new theme park for TRC Inc. The
information is provided through statistics for theme parks in the United States that are
based on revenue, costs, attendance, expected growth, job creation, and competition.
Based on these statistical trend-based projections, we can conclude on the feasibility of
building a new theme park in the current U.S. market and how it will affect its
establishment.
Internal and External Factors - Describe the key factors that may affect the success of a
new theme park.
Resource factor
Natural factor,
Customer
Labor force
Competitor
Based on the factors, it is entirely possible to establish a new theme park. In terms of
attendance and expected growth statistics, one can see the feasibility of opening a new
park in the United States. As the attendance and market share of theme parks have grown
steadily, the demand for more theme parks has emerged.
 Theme Park Report-2017 5

INTRODUCTION
This report examines the feasibility of building a new theme park for TRC. The
information is provided through statistics for theme parks in the United States that are
based on revenue, costs, attendance, expected growth, job creation, and competition.
Based on these statistical trend-based projections, we can conclude on the feasibility of
building a new theme park in the current U.S. market and how it will affect its
establishment.

The theme park in Illinois

The possibility of building a theme park is based on the company's development needs
and social needs. The following data includes market analysis and surveys of theme
parks.
Cost
Revenue
Attendance
Job creation
Expected growth

Key factor of building the theme park

In the construction of the theme park will encounter measurable and unpredictable
factors. Company need to consider not only the instability of their construction plans but
also the internal and external factors that will affect the success of the theme park.
Customer
Resource factor
Natural factor
Labor Force
competitor
 Theme Park Report-2017 6

The status of the theme park in the industry

Figure 1 (IBISWorld, 2017)

The overall theme park is in a state of saturation. Every year theme parks will bring
stable income with a slow growth trend. In Figure 1, the average revenue of the theme
park is $ 17.7bn, and the profit is $ 3.5bn, so the theme park will generate steady revenue
for the company even in a saturated space of development.

Figure 2 ( IBISWorld, 2017)

Cost
First, the cost of building a theme
park is based on fixed costs
associated with land, safety
equipment, and rides. Second, the
cost of capital is high because our
company need to keep their existing
rides and specific areas regularly
updated. The future may also need
to develop new rides and scenic
spots in order to attract new tourists
and retain existing tourists. The
lack of investment in new rides and
attractions often has a negative impact on the number of tourists. Wages are the essential
cost after the theme park construction is completed. According to statistics, the cost of
wages accounts for 20.9% of the total industry revenue in 2017. Due to the seasonal,
weekly or even daily changes in visitor patterns, the industry relies heavily on internal
staff to contain costs.
 Theme Park Report-2017 7

Revenue
The revenue of theme park is one of the main reasons for the construction of the theme
park. Figure 3 shows the source of revenue for the theme park as a percentage.
Admissions, rides, and game
Food and beverages
Merchandise

Figure 3 (IBISWorld, 2017)

Admissions, rides, and game

According to the data analysis, admissions, rides, and games are the primary source of
income for theme parks, so what types of rides and games need to be considered when
building theme parks will attract tourists and develop different types of regions.
For example, Universal Studios divided different regions corresponding to the needs of
various tourists. Different regional construction will also give visitors a different feeling.
At the end of the summary report, technicians can make the analysis about what types of
areas and rides are the most visited tourist spots, according to which the company can
improve and update the necessary equipment.

Food and beverages

The theme park is usually a full-time event, which means most visitors will buy food and
drinks at the theme park. For the purchase of food and beverage, there are two feasible
suggestions that may be available for use.
 Theme Park Report-2017 8

1. The company buys drinks and food outside, then raises the price to sell in the theme
park. This company can get the most benefit.
2. The company can look for partners and sponsors through a tender, such as Coca-Cola,
PepsiCo and some restaurant chains. In other hand, it can help some people to start their
small business. This not only helps the company reduce costs, but also provide more jobs.
The company will receive less profit because the company's profits will come from these
partners and sponsors through bidding and annual dividends.

Merchandise
The company can advertise by creating an animated cartoon about the theme park. Then
use the existing resources to create a theme park logo clothes, cartoon models and other
souvenirs and toys. A part of the fixed costs can be borne by the profits of the sales of
merchandise.

Attendance
Statistics show that from the fall of 2013 to the spring of 2017, there has been an increase
in the number of people visiting the United States theme parks. Statistics show that 71.65
million people in the United States attended the theme park within the 12 months prior to
spring 2017. There was no significant change in visitor attendance at theme parks, but
attendance was affected by natural factors, and the theme park was not expected to run
properly from January to April due to the weather-specific nature of Illinois (the snowy
season).

Figure 4 (Statista)
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Internal and External Factors

Resource factor:
The improvement of the amusement project of the theme park or the development of the
related projects will affect the future planning of the company. (Including changes in
market demand, technical barriers and shortage of human resources)
Natural factor
Natural Factors As an uncontrollable condition, it contains natural disasters, weather
changes, policy changes or circumstances beyond their control and unpredictability.
These natural factors will affect the normal operation of the theme park and even bring
devastating losses. However, managers of the company need to make contingency plans
or disaster management plans in advance to deal with unexpected incidents, to minimize
losses and make up for losses.
Customer
Visitors to theme parks, who may be individuals, may also be friends, or families. In
order to be competitive, the company must have a deep understanding of their needs and
wishes. The Company can make sound strategic decisions that affect their operations. For
example, the company made some changes for customers, such as additional services,
new theme equipment, opening up new thematic stories or expanding operating hours
may improve the competitiveness of the company.
Labor force
Workforce skills and expertise can also determine the company's rise and fall. In hiring, I
strongly recommend that our manager should look for features that include the average
level of education in the community, available training programs, technology, and
diversity.
Competitor

Figure 5 (Statistic Brain)

Six Flags is one of our top competitors in Illinois, followed by a nearby water park in
Wisconsin. Record revenue in second quarter 2017 for Six Flags increased by $ 15
million, or 4%, as of June 30, 2017, an increase of $ 422 million from the same period in
2016. This is mainly due to the rise of 5% in the number of 9.5 million visitors. Six Flags'
revenue continued its slow upward trend even though total visitor spending was 2%
 Theme Park Report-2017 10

lower than in the previous years. According to Figure 5, Six Flags had 25.63 million
attendances of visitors in 2014.

Job creation
The employment opportunities provided by the theme park not only bring about the
possibility of development, but also stimulate economic growth and help the government
to establish an economic system. Since the beginning of 2016, Illinois has a budget
deficit of up to 600 million U.S. dollars at the end of the year, so building a theme park
will drive economic growth. According to Jason Garcia, statistics show that Disney's total
employment in Florida rose 14.2% since reaching the bottom of 58,400 points in 2009, an
increase of 7.6% over the 62,000 points before the recession.

Expected growth
As one of the hottest spots, theme park spending has risen faster than nominal global
gross domestic product (GDP) growth since 2012, with the IAAPA estimates that the
growth trend will continue into the forecast period (Figure 6).

As a result, IBISWorld predicts that total gross revenues from theme parks will grow at an
average annual rate of 2.0% to 19.5 billion dollars in the five years to 2022, also, revenue
for 2018 is expected to increase by 2.2%.
 Theme Park Report-2017 11

CONCLUSION
Overall, building a theme park has a high feasibility for the company with a substantial
economic potential to society. According to the data, attendance of theme park keeps in a
stable situation, so that the revenue will also have a constant growing expect for natural
factor. Compared to significant revenue the costs of construction and human resource are
not so high. And it can also provide plenty of job occupations which is useful to society.
A theme park will undoubtedly have a massive impact on the local economy. It cannot
only attract tourists, but also provide employment opportunities to help someone in
urgent need of further regional development (restaurants, holiday businesses) and
increase local taxes, which are conducive to the government to support any other city
service provides TRC Inc. with the information it needs to evaluate the feasibility of
building a new theme park. However, the investment to the theme park is quite worthy
since it is a low-risk and high-return project.
 Theme Park Report-2017 12

Work Cited

IAAPA. 2015 2020 Global Amusement Park Outlook. PREPARED FOR THE 2016

MARKETING OUTLOOK FORUM, International Association of Amusement

Parks and Attractions, ND. https://www.IAAAPA.org

Jason, Garcia. Theme parks add thousands of jobs in building spree. Tribunedigital-

Orlandosentinel, Orlando Sentinel, 28 Oct. 2012,

http://articles.orlandosentinel.com/2012-10-28/business/os-cfb-cover-top-

employers-1029-20121028_1_animation-resort-disney-s-art-theme-parks.

Six Flags. Record Revenue in Second Quarter 2017 for Six Flags. Six Flags, Six

Flags Entertainment Corporation, investors.sixflags.com/news-and-events/press-

releases/2017/07-26-2017-120059613.

Statistic Brain. Six Flags Theme Park Statistics. Six Flags Theme Park Statistics,

Statistic Brain, 12 Sept. 2017, www.statisticbrain.com/six-flags-magic-mountain-

statistics/.

Brian, Sayler. IBISWorld Industry Report 71311. Amusement Parks in the US,

IBISWorld, Mar. 2017,

http://clients1.ibisworld.com/reports/us/industry/default.aspx?entid=1646

Statista. Visitors of any theme park in the U.S. 2017 | Statistic. Number of people who

visited any theme park within the last 12 months in the United States from autumn

2013 to spring 2017 (in millions), Sept. 2017,

www.statista.com/statistics/360394/theme-park-visitors-usa/.