Sky Casino

David Alarcia Pérez
Manuel Candón Estudillo

Diego Colomo Rodríguez
Germán Jimena de la Resurrección
Diego Priego Moreno
Gonzalo Jiménez Mozo

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Aerospace MBA 2016/2017
MISSION, VISION & OBJETIVE 3
PORTER FORCES 4
INTERNAL ANALYSIS 16
EXTERNAL ANALYSIS 19
SWOT ANALYSIS 20
OPPORTUNITIES AND THREATS: 20

STRENGTHS AND WEAKNESSES: 20
SWOT 21
STRATEGIC RESOLUTIONS 22
MARKETING PLAN 24
CUSTOMER SEGMENTATION 26
MARKET ANALYSIS 29
PRODUCT 35
PRICING 41
COMMUNICATION AND PUBLICITY PLAN 47
ORGANIZATIVE PLAN 56
INTRODUCTION 57
PORTFOLIO WIDENESS OF PRODUCTS 57
CUSTOMER EXPERIENCE 57
VALUE CHAIN: 59
STRATREGY 61
CORPORATE ORGANIZATION: 62
BUSINESS ENTRANCE AND STRATEGIC EVOLUTION: 63
OPERATIONAL PLAN 64
AIRCRAFT DEFINITION 65
AIRCRAFT LEASING 68
CASINO OPERATION PLAN 69
MRO PLAN 72
AIRPORTS 75
PASSENGER PROCEDURE 79
ROUTE OPERATION 80
FUEL PROVISIONING AND AVAILABILITY 84
SERVICES 86
OPERATIONAL COSTS 87
CONTINGENCIES SCENARIOS 89
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LEGAL PLAN 92
LEGAL FORM OF THE COMPANY 94

GENERAL LEGAL FRAME REGARDING AVIATION LAW 95
GENERAL LEGAL FRAME REGARDING GAMING LAW 97
APPLICATION TO OUR PARTICULAR CASE – SKY CASINO 99
CABIN LAYOUT 100
GENERAL LEGAL FRAME REGARDING TAXATION 101
TAXATION APPLIED TO OUR CASE – SKY CASINO 102
CONCLUSIONS 103
HUMAN RESOURCES PLAN 104
HUMAN RESOURCES STRATEGY 105

ORGANIZATIONAL PLAN AND JOBS DESCRIPTIONS 109
CONTRACTS AND WAGE POLICY 114
FINANCIAL PLAN 117
FINANCIAL STATEMENTS ANALYSIS 118

DIVIDENDS POLICY AND RETURN OF INVESTMENT 126
COMPETITORS COMPARISON 127
5 YEAR FINANCIAL STATEMENTS & RATIOS 128
FINANCIAL STRESS ANALYSIS 130
CONCLUSIONS 133
GLANCE INTO THE FUTURE… 134
NEW ROUTES 135

AIRPORT CASINOS 135
CHARTER CASINO FLIGHTS 135
CARGO TRANSPORT 136
REFERENCES 137
EXTERNAL & 5 PORTER’S FORCES 137

MARKETING PLAN 137
OPERATIONAL PLAN 137
LEGAL PLAN 138
HUMAN RESOURCES PLAN 139
FINANCIAL PLAN 139
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“We create a unique and premium experience merging
gaming and fast transportation in
perfect synchrony.”
“To become the airline , creating a new market in

which we will be loved by our customers to who we will
deliver the most satisfying
experience”
new market, becoming a

“Stablish a
profitable company that will consolidate our
customers and grow to new routes when the time is
right”
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As usual in every business plan, we need to analyse the environment surrounding our idea.
For that, we will look into the 5 Porter forces, which are the new entrants in the market, the
companies and products directly competing with our product, the customers in our market,
the suppliers we will need to provide our service and the substitutes currently operating.
Threat of new entrants is another major aspect of the five forces. This aspect has a low threat
for the airline industry. However, There exists a real risk new entrants are willing to provide
a similar service in the near future, since the market is really attractive (A380 sales and a global
gambling increasing) However, this willingness will be dramatically reduced once our company
become the first, pioneering enterprise to do so. Main reason is that the total amount of
investment would be considerably higher, and only some airlines and private wealth could
afford it. Hence, as we worry about our clients’ loyalty and to make us stronger we have
decided to create the VIP Club in order to increase the perceived value of our customers.
Our enterprise, as already described, has two core business, both fundamental. On one hand,
the air transport between Guangzhou or Hong Kong airports, China, and Sydney Airport,
Australia, for high net worth individuals and therefore with a treatment of high quality. On
the other hand, gaming business, with the environment of exclusivity.
It is obviously an innovative business, and as such it has no direct competitors. It has, however,
competitors in each of its core business separately. That is why we are going to divide this
part in competitors in air transport business, where we will see the main alternatives to our
airline for the transport between the above-mentioned countries, and gaming industry
competitors, where we will see alternatives to our flying casino in both countries
Conventional airlines
Conventional airlines are one of our direct competitors, specifically those airlines whose
aircraft configuration is adapted to business passengers, VIP and high class economy.
Our market segment values highly the investment in time during the journey, therefore we
are not going to consider the airlines that offer the connection with layovers and there are
only three airlines that make regularly without layovers the connections we are focusing in.
We will analyze said airlines and the service they offer.
Qantas:
Qantas Airways Limited is the flag carrier airline of Australia and its largest airline by fleet size,
international flights and international destinations.
The airline is based in the Sydney with its main hub at Sydney Airport. As of March 2014,
Qantas had a 65% share of the Australian domestic market and carried 14.9% of all passengers
travelling in and out of Australia. Various subsidiary airlines operate to regional centers and
on some trunk routes within Australia under the QantasLink banner
In the route we are interested in there are very convenient schedules, 2 or 3 flights a day and
with a duration of around 9 hours (taking into account time difference between both areas, it
varies between 6 and 12 hours)
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From their fleet, only 2 aircrafts usually do the routes we are analyzing.
 Airbus A330
Quantas owns 2 different versions of the A330 plane, one of them with three
different cabin layouts. All of them offer a two-class, Business and Economy, service.
-
-
Ilustration 1: Qantas A330-300
Ilustration 2: Qantas A330-200 layout A
Ilustration 3: Qantas A330-200 layout B
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Ilustration 4: Qantas A330-200 layout C
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 Airbus A380
The huge capacity of this aircraft allows a 4-class service.
Ilustration 5: Qantas A380-800
The price of the tickets is around 750€ for economy and 3000€ for business (go and return)
but it is very variable as many other airlines.
China Southern Airlines:

China Southern Airlines Company Limited is an airline headquartered in Baiyun District, Guangzhou,
Guangdong Province, China. It is the world's sixth-largest airline measured by passengers carried and
Asia's largest airline in fleet size, revenue and passengers carried. It is the fourth-largest airline in the
world in domestic passenger traffic and the sixth-largest in scheduled domestic passenger-kilometres
flown. From its main hubs at Beijing Capital International Airport and Guangzhou Baiyun International
Airport, the airline flies to 193 destinations using a fleet of more than 500 aircraft.
It does not fly Hong Kong – Sydney, but Guangzhou-Sydney. It usually flies four different aircrafts, one
of them with two different layouts. We analyze the now:
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 A330-200 A: Three class, most of it economy.
Ilustration 6: China southern airline A330-200 A
 A330-200 B: Similar to the previous one, but with 4 First class seats.
Ilustration 7: China southern airline A330-200 B
 A320: Three classes, mostly economy.
Ilustration 8: China southern airline A320
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 A321: Three classes, mostly economy.
This airline owns 5 A380 in service. Due to the demand limitation of the airlines' international
hub at Guangzhou Baiyun Airport, few routes from Guangzhou have the demand to support
an A380. In effort to make its A380s viable, China Southern started operating A380 on its
Guangzhou–Los Angeles route and on the Guangzhou–Sydney route. Now the A380 comes
to Sydney every summer (southern hemisphere) during its peak travel period
 A380: Three classes. The big capacity of this aircraft allows to have a huge amount of
business seats, as well as economy and 8 first class seats. This aircraft would be the
main competitor to our airline.
Ticket prices are very similar to those offered by Qantas.
Cathay Pacific:
This airline makes the route Hong Kong – Sydney. Cathay Pacific is the flag carrier of Hong
Kong, with its head office and main hub located at Hong Kong International Airport. Cathay
Pacific is the world's tenth largest airline measured in terms of sales.
Cathay Pacific operates an all-wide-body fleet composed of Airbus A330, Airbus A340, Airbus
A350, and Boeing 777 aircraft, and the route we are studying is mainly covered with their
B777-300 (Commonly known as the Dreamliner jet), in one of its two different layouts:
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The ticket price is steady and goes for 846€ per flight in economy class, 3700€ business class,
go and return ticket.
Our airlines separates from this competitors because our added value lies in the exclusivity of
being able to perform a unique activity in this business, which is to play games of chance on
a moving plane. Therefore, as far as price strategy is concerned, at equal price any person
with high purchasing power, wanting to enjoy a unique experience and being able to tell their
closest friends will opt for our company instead of for one Conventional airline.
Casinos
On the other hand, our other big competitors are the casinos. Although the functioning of
these is known worldwide, objectively is known the large number of people who spend their
money in this sector on a daily basis in certain countries, being China and Australia ones with
the biggest expenditure in this sector.
Here we will analyze the possible alternatives that our customer can have in the casino
industry in the mentioned regions. We will look into conventional casinos stablished in any of
the cities that our chosen route connects.
Sydney
Gambling is an activity undertaken by many Australians. Over 80% of Australian adults engage
in gambling of some kind, which is the highest rate of gambling in the world.
There is no much information about the casino aspect of this Project, but it is estimated than
it will be over 40.000 m2 with around 480 gaming tables.
Let’s continue studying the different casinos in the city.
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 Crown Sydney:
Ambitious Project, still in construction. It is a 270

meters high hotel-casino. Its casino will only operate
VIP with membership restrictions.
Its opening, which has already suffered delays, is

currently planned for 2021
Its architecture aims to become the new icon of the

city of Sydney, offering to the Bangaroo precinct an
innovative space, acknowledge in the whole world,
with a 6-star quality.
 The star casino:
It is our main investor and shareholder, so it is a partner

more than a competitor. However, in order to have a full
view of Sydney gaming offer we will analyze it.
The Star Sydney (formerly Star City Casino and prior to that,
Sydney Harbour Casino) in Pyrmont, Sydney, is the second
largest casino in Australia after Melbourne's Crown Casino.
The Star features two gaming floors, eight bars, seven

restaurants, 351 hotel rooms and 130 serviced and privately
owned apartments. It also includes the 2,000 seat Sydney Lyric theatre and Event Centre. It
is licensed to be the only legal casino in New South Wales, in late 2007, it was granted a 12-
year extension of its exclusivity and license, which will end in 2019.
The Star provides many traditional casino games, including Mini Baccarat, Blackjack,
Caribbean Stud, Craps, Pai Gow, Poker, Pontoon, Roulette, Rapid (semi-electronic) Roulette,
Sic Bo and Three card poker. The Star provides a selection of electronic gaming machines,
including slot machines, bingo, rapid roulette and video poker machines.
China
Gaming in China is forbidden except in the regions of Macau and Hong Kong, which we will
analyse separately. Therefore, competition in China is non-existent or illegal.
Macau
Gambling in Macau has been legal since the 1850s. Since then, Macau has become known
worldwide as the "Monte Carlo of the Orient".
Gambling tourism is Macau's biggest source of revenue, making up about 50% of the
economy. Visitors are made up largely of Chinese nationals from the mainland China and
Hong Kong. With the entry of large foreign casinos from Las Vegas and Australia, Macau
overtook the Las Vegas Strip in gaming revenues in 2007.
Macau, a special administrative region like Hong Kong, is the only place in China along with
Hong kong where casinos are legal, and the business has grown at an astounding pace.
However, change in policy resulted that in 2015 GGR was only $29 billion, but still five times
that of Las Vegas. Although the average spend per player is no longer ten times that of Las
Vegas gamblers, it was still six-times in 2015 and the gambling economy is on the mend.
Although 2016 still sees Macau experiencing a temporary downturn, the casinos there pull in
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more than any others on earth with about $US13.5 billion in gross gaming revenue (GGR) for
the first six months of the year.
There are 35 casinos in the region of Macau, all of them offering at the same time as hotels,
restaurant and many other facilities.
Hong Kong
As Macau, Hong Kong is a special area where laws differ significantly from mainland China.
Although gambling is legal, it is restricted to a few regulated outlets, being illegal both betting
through bookmakers or in other place than a gambling establishment.
There are 6 legal gaming establishments, which are cruises and race tracks, since there are no
conventional land casinos. In order to get an order of magnitude of their size, the biggest of
them is Holland America Cruise Line Volendam, with 8 table games and 72 gaming and video
poker machines, which is very small compared to the neighbor city of Macau.
Since the experience these conventional land casinos offer are somewhat popular and well-
known, our company has decided to go one step further, offering the services of the best
casino traveling in a luxury plane. This makes the customer's stay unique, unrepeatable and
that only certain people in the world can enjoy. Taking not only the experience of the game
to a higher level, but also making his future experience after the game increase by just telling
his family and friends that he is one of the chosen few in the world that has enjoyed the Game
of chance while flying in the world's largest airplane.
Competitors conclusions
Regarding airline competition, we conclude that there are already three existing Airlines that
have a great influence doing the connection regularly. We have to enforce our value
proposition, since what we offer is different and unique.
Another point that needs to be taken into consideration is that, with respect to Qantas fleet,
only their A380 has VIP class configurations, therefore every connection not being made with
said aircraft (out of high season is not very used in this route), we offer a clear alternative of
high quality level. The same way, Southern Airline or Cathaway Pacific, when they do not use
their airplanes with VIP class configuration we would be de high class alternative.
Talking about casinos, in Sydney there is no competence, because there is a monopoly of only
one luxury casino, monopoly that will end in 2021 with the opening of the crown casino.
There is a huge opportunity of partnership with those casinos.
In Macau there is a big competence in the number of casinos, but the new restriction in politics
have reduced it enormously. Also, our flight would not depart from Macau but from the
Guangzhou or Hong Kong airports, which are better connected and that would grant us a
higher capacity of attraction of people from the rest of mainland China than Macau.
In Hong Kong there is no competition in the area of land based casinos.
However, it is difficult to compete in table capacity, number of games, etc., since our available
space is very restricted. That means we have to focus in our value proposition of exclusivity
and experience, since we offer something different than the rest of competitors.
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Our company offers the first opportunity in the world to enjoy the game of chance, and the
unique sensation of the game, more than 10,000 meters high, while flying.
After analyzing the market and the state of the art of gambling in the world, our company has
decided to focus on the Australia - China route, since these two nationalities are the ones that
spend the most in this type of business.
In addition in both countries a high degree of population is concentrated, and therefore a high
number of potential customers to enjoy our unique experience within an A380.
Our customers will also have a high purchasing power and therefore will have at their disposal
an Airbus A380, with the best comforts and facilities, as well as the large free space that it
contains.
Of course, our target customer is going to travel from China to Australia, and vice versa.
And given the need to have a long trip for business, leisure and / or personal reasons, take
advantage of this time, enjoying a unique experience in the world. And at the same time, for
those customers who just want to play the game of chance in a different and special way,
offer them the possibility of getting to know other countries.
However, we do not only target to those customers who were already going to do that route,
but also to create a market of people who will travel to said destinations because of our
business.
Chinese & Australian High income level people

The explosive growth of China’s emerging middle class has brought sweeping economic
change and social transformation. By 2022, as McKinsey research suggests, more than 70
percent of China’s urban consumers will earn ($9,000 to $34,000) a year. And 25% of china’s
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urban population will earn more than $34,000 (B$1,015).In the decade ahead, the middle
class’s continued expansion will be powered by labor-market and policy initiatives that push
wages up, financial reforms that stimulate employment and income growth, and the rising role
of private enterprise, which should encourage productivity and help more income accrue to
households.
In real terms, the average equalized disposable household income in Australia was $998 per
week last year and the average weekly equalized disposable household income for high
income households rose from $1,903 to $2,037.
Gamblers
One of the reasons for gambling is that its human nature to feel excited when taking risks and
the positive feeling gained from gambling is no different. "Will my numbers come up?" "Will
my team win?" The sense of anticipation creates a natural high, an adrenalin rush, a feeling
that very many of us seek when looking for fun and entertainment. A feeling that some people
believe they cannot live without. We have catalogue different types of gamblers: professional,
antisocial, casual social, serious social, relief and scape and compulsive.
Travelling
Boeing says that "between 2015 and 2033, we expect that the number of travellers by plane
will grow by 4.9% per year, while the traffic of goods will be 4.7%," and where the higher
growth will be placed in Asia, "40% of all new aircraft to be delivered will be based in the Asia-
Pacific region," says the manufacturer, with China as a major customer.
Therefore, another reason is that the Asian population is increasingly interested in flying, and
taking advantage of this large increase, our company wants to offer a highly differentiating
factor and a unique experience.
To sum up this section, Sky Casino is focused on high income level people from China,
exploding growth, and Australia ($2,000 average weekly equalized disposable household
income for high income households). Besides people who loves playing bet games in a social
way (Chinese and Australian are both the higher gamblers in every world gambling rank) and
flying more and more (about 40% of all new aircraft to be delivered will be based in the Asia-
Pacific region).
Among the possible suppliers for our main assets, the aircraft, we find the following:
Airbus, Boeing, Mcdonnell Douglas, Lookheed Martin, Northop Grumman, Bombardier,

Embraer, ATR, Beechcraft, Cessna, Piper, Britten Norman, Antonov, Ilushing, BAE.
Due to the size and the current situation involving the A380, where price is dropping, we have
chosen Airbus as our main supplier.
In this case the major supplier is the A380 airplane manufacturer Airbus. The current
configurations working now are the following ones:
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Deck Upper Deck
Total
Airline Premium
Passengers Class First Business Economy
Economy
Pitch/Width 55"/24" 38"/19" 32"/17.5"
Air France 516 Seats – 80 38 46
Configuration 02/02/2002 02/03/2002 02/04/2002
Pitch/Width 72"/20" 38"/18.5" 31"/17.5"
British Airways 469 Seats – 53 55 104
Configuration 02/03/2002 02/03/2002 02/04/2002
Pitch/Width 77"/24" 32"/17.2"
China Southern Airlines 506 Seats – 70 – 76
Configuration 1-2-1, staggered 02/04/2002
Pitch/Width 86"/23" 48"/18.5"
489 Seats 14 76 – –
Configuration 01/02/2001 1-2-1, staggered
Seats 14 76
Emirates 517 – –
Configuration 01/02/2001 1-2-1, staggered
Pitch/Width 48"/18.5" 32-34"/17.5"
615 Seats – 58 – 120
Configuration 1-2-1, staggered 02/04/2002
Pitch/Width 80"/29.5" 73"/20"

Etihad Airways 498 – –
Seats 9 +2 70
Configuration 01-ene 1-2-1, staggered
Hence the next step is to deal a new casino configuration with the needed features.
Another important supplier will be the MRO Company. The A380 Airbus MRO Network
includes the following 15 members:
- Air Canada Technical Services - Iberia Maintenance

- Air France Industries - Lufthansa Technik AG
- Air New Zealand Engineering - Sabena Technics
Services - SIA Engineering Company
- EADS SOGERMA Services - Singapore Technologies Aerospace
- Guangzhou Aircraft Maintenance - SR Technics Switzerland
Engineering Company [GAMECO] - TACA Aeroman
- Hong Kong Aircraft Engineering - TAP Maintenance & Engineering
Company - TIMCO Aviation Services
And after analyzing them, our MRO supplier will be Hong Kong Aircraft Engineering
Company] or because of the fact that they are located in China and with a lower cost.
As a summary, Sky Casino has chosen as bigger supplier Airbus due to is the A380 airplane
manufacturer Airbus and Hong Kong Aircraft Engineering Company as MRO Company
recommended by the manufacturer.
We are pioneers in this business, and there is still no substitute projects for a casino-airline.
In a far future zeppelins, airlines, trains in case they could reinvent themselves could become
a substitute but not in the short or medium term.
However, we will review some enterprises that, not being conventional airlines or land
casinos, can somehow compete indirectly with our business.
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Charter Flights
A charter flight is the name given to that trip in which a particular airline leases one of its
planes in order to make a special trip for a group of people, in order not to have to submit to
schedules and destinations for purposes generally related to tourism.
It offers absolute flexibility of Schedule, aircraft type, destinations, origins, etc.
There are several companies dedicated to organizing charter flights in the area we are
studying, such as private fly, air charter international, execujet, among others.
The main problem is the high price. For aircrafts capable of reaching destination without
layovers, the price is around 100.000€ / 8pax. For cheaper aircrafts that need to stop midway,
which means making the trip longer, around 50.000€/8pax.
In both cases the flight takes more time, because even if it is a direct flight, the aircrafts in
these cases are usually slower than the aircrafts used by commercial Airlines, such as A330
or A380.
There is a fair chance that due to configuration issues, there is no possibility in a short-term a
company could offer a charter flight with a casino configuration. But we can reach a part of
their target, as professional sports player, actors, singers that often rent an aircraft for their
huge staff.
Private Aircrafts
It is the option in the far end of high price and flexibility. Ownership of an aircraft is really
expensive, not only for the acquisition cost, but also the operating and maintenance
expenditures. Of course, the flexibility comes because you can use it at your own discretion,
no restrictions that usually go with airlines or charter companies.
Just like buying a car, buying a brand-new luxury jet will cost you significantly more than
purchasing a second-hand one
At the lower end of the price spectrum you have the Beechcraft King Air or Super King Air
Turboprop, which are an excellent ‘starter’ private planes. With a price tag ranging from $4
million to $7.5 million, in the private jet stakes this is considered entry-level.
Higher up the spectrum, there are aircraft such as the Dassault Falcon, Gulfstream V-SP and
Bombardier Global Express XRS in ascending order of cost. The Dassault Falcon is typically
available from around $50 million up to a ‘max’ of roughly $300 million for the BBJ (Boeing
Business Jet)
Cruise Ship Casinos

Since they offer an experience that could be comparable to our business, we will study cruise
ship Casinos separately. Most large cruise ships, and even some of the smaller ones (Crystal's
1,000-passenger ships, for example), have an onboard casino.
From the regions studied, only in Hong Kong they are important business. Let’s review some
of them:
The Rex Fortune

They have a 600-passenger cruise ship staffed with over 200 with a regular assistance of 80
clients per night (including casino, karaoke nightclub, bar, massage room, hairdresser, Mahjong
room, slots machines, and even a gym) where they target mainly Chinese men,
honing/pointing in on their customers with leaflets, quoting 500 Hong Kong dollars for night
of gambling, karaoke, and room and board.
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Due to the fact that Hong Kong strictly regulates gambling. The handful of casino ships get
around the strict regulations by shuttling guests 12 nautical miles out into international
waters, where a ship’s flag determines laws that apply.
They have an unsavoury reputation, including links to triads and prostitution, reports local
media.
The minimum buy-in at the standard tables is HK$500 (about US$65)
The nine months ending in March 2015, it had 21,500 visitors and earned HK$16.6 million in
profit, according to the annual report of Rex Global and they bought the ship in August 2014
from Success Universe at HK$93 million.
Royal Caribbean ships

Similar service than the Rex fortune.
During the first six months of the year, Royal Caribbean earned a staggering $3.9 billion in
revenue, from 2.56 million passengers. That means each passenger generated an average of
$1,510 in revenue. About 72% of revenue comes from cruise fares. The rest from other
sources, including onboard activities. So how much does that mean in profit? Royal Caribbean
earned a profit of roughly $164 million during the first six months of the year. That is $64
per person in profit, about 4% of every dollar it earns in revenue.
In summary form, Cruise Ship Casinos are thought for mid-class people playing at night out
of the law in some cases and it is supposed that the customer must spend a few days inside
the ship, where the company run it gets around 70% of revenue from cruise fares and a 5%
of net profit.
Conclusion – substitutes
A charter flight has more flexibility than our sky casino, but it also means an important
increase in price. We argue that it is a good alternative but only when you have to move a
high enough number of people that can fill the plane and therefore avoid the price per
passanger to skyrocket. Also, it is an interesting option when it is needed to flight outside
commercial schedules.
Respect to the private aircrafts, we offer as we said a lower price than the ownership of a
private plane.
In addition to that, we offer a higher number of passengers that would allow to organize
gaming that could not be possible in charter or private aircrafts.
Respect to gaming cruises, they are the only business that offers a value proposition similar
to our own, transport and gaming. However, they target a different segment, they are of no
good reputation and compete in low prices.
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As it is explained before in this document, to offer a Business Quality Travel with the
opportunity of gaming while flying is the product that it is going to be sold. Around it, a
company is going to be built in order to accomplish the vision and mission referred above.
The specifications of this product frame the circumstances of the company and the other way
around. That is why one cannot be explained without the other. In the next lines both aspects
are going to be detailed.
The most important piece of information here is that the product is a Premium Experience of
travelling like no one before. The real added value is what the customer is going to live and
not only traveling or gaming. In consequence, a new product is created and the best way of
explaining the product is through the experience itself. After, some key aspects are going to
be explained.
The experience starts with the purchase channels. No matter if you book through the website,
some special app like BlueFish, through a special agency or by your junket like a pro gambler…
The booking is going to be really good taken care of and constantly improving. After booking
and for a price slightly more expensive than a normal business travel you will be able to access
to an international flight in one of the most exclusive planes in the world. An A380, the biggest
commercial aircraft, with a unique configuration. With two heights, the lower one is going to
be a comfortable space with business+ seats and all the accommodations you can expect from
it. Also, gaming is an integrated part in the digital entertainment you can find in your own
seat. Along with a cabin crew dedicated to make the most from your flight with Sky Casino.
But the better part is yet to come. The upper height is the only one space in the world
dedicated to a flying casino. You can dedicate there your usually boring travelling hours in
one exciting journey. Gaming at poker tables, baccarat or black jack to digital coin machines.
Sonner than expected you’ll be in your destination and who knows, maybe you have hit the
jackpot and you have travelled for free and earned some money with tax benefits from gaming
on board.
That is the product and the key aspects to be able to offer it are:
The A380 plane for obvious reasons. Company staff (from sellers to cabin crew), they can
make the most from the time a customer relies in Sky Casino and create engagement and
loyalty. And last but not least airport and “on land” services because they frame the controlled
environment and can disturbed the essence of the experience.
Once the product is determined the company must adapt to be able to provide it. For starters,
this company must be international because it provides an international flight service. Then,
it can be based in one place and operate between two other places such as the proposed
China and Australia destinations. Another country related issue is the flag that the plane has.
This affects to the legal aspects that must be followed during the flight. From behavior
aspects, such as smoking or alcohol drinking on board, to game regulation and taxes.
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Innovative Service
This service is not provided elsewhere. Sky Casino creates an innovative experience that is
not replicated so far. This mean a core strength for our business because it creates a premium
and exclusive atmosphere that generates desire. Being an experience a lot of people would
like to live but only a few can is a key aspect for this business.
Excellent Customer Service

As a company, selected and happy staff are not an election but part of the culture. The best
people doing the work they love is what makes the difference between being mediocre or
delightful. Sky Casino is not taking any chances about it and makes of this matter another
strength.
Technology Knowledge
The technology this business is based on is stable right now and very well known by our team.
As trained aerospace engineers, some of our executives know some about aeronautical
technology. More precisely, operations, maintenance and execution of the A380 plane and
airports.
Attractiveness
As explained above, the unique experience with the highest quality standards make Sky
Casino’s travel attractive and desirable. If people know it and want it, consume would be the
logical consequence.
Environment Selection
As a company, you can’t control your environment but what you can decide where you are
based and well managed this becomes a strength. We have a plane with the most profitable
flag in taxes matters and are based between China and Australia. Places where people really
like gaming and that have a lot of net worth individuals. You can’t control environment
changes but you can assure to start with the right foot in your business.
Lack of Knowledge in Gaming Business

On the other hand, we have a serious lack of knowledge or experience in gaming business.
We have studied the issue well enough to realize that the mixing with travel is profitable but
we don’t have experience in this matter. This will be mitigated with hiring and partnership
policies.
Irregular Income Stream

Another weakness for this enterprise is that the income stream is not regular. Half of the
business can be controlled by trying not to leave any seat unoccupied in any flight. But the
other half of the business is based in gambling. The gambling tendency is always profitable all
around the world, but it is based in some uncontrollable factor that can make some travel
really profitable while the revenues in others can drop hard.
High Fixed Costs. A380 Maintenance and Operation.

Sky Casino has not big properties, offices or a lot of staff but it is completely dependent on
the A380 plane. It’s leasing, maintenance, operation costs and also inoperative time while it is
maintained are expensive tasks that affects to the business no matter if we make money from
it or not. These fixed costs are a strong barrier to surpass in order to be profitable.
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Lack of Networking and Market Presence
As a new product provided by a new company in a new environment, Sky Casino completely
lacks of networking with business in the area or marketing presence in the area. This is a huge
handicap that must be overcame with a good investment in branding marketing and also
selecting strong partners in the area.
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Our business is not only affected by internal factors in which we can decide or affect, but also
by external factors that we have to take into account in order to mitigate, if they are threats,
or empower, if they are opportunities.
In the following section, we will analyze these external factors and classify them as threats or
opportunities.
Political
We find several important pieces of information about the political situation. On one hand,
we have the opportunity of a stable political framework in the country of Australia. On the
other hand, we have a certain lack of transparency in the Chinese government.
Apart from that, the recent liberalization in air traffic between Australia and China is
undoubtedly a good opportunity to our business.
Cultural
We have good data analysis and tendencies about the HNWI individual in the following years,
which joined with the deep culture of gambling leave us with a really interesting market for
our product.
Technological
The main technological assets is the A380 aircraft. It presents the opportunity of being a
Reliable and robust aircraft, totally developed whose price has decreased. However it has also
the disadvantages of high fixed costs and a limited number of airports to operate. On the
bright side, we have an available MRO in the proximity of Hong Kong airport.
Legal
We have to overcome the threat of the Chinese gaming regulation that strictly forbids it.
However, the open legislation of Macau, Hong Kong and Australia will help us overcome. Not
only has that, but the fact that in Australia players are not taxed become a really interesting
opportunity.
Other legal issue is the threat we find when having the necessity of having the casino
configuration certification.
Environmental
In this section we find several threats, that are the mid occurrence natural hazards on flight
along south east china, the high CO2 emission per passenger and kilometer due to CASINO
configuration and the mid occurrence natural hazards on Canton area due to cyclone activity
during some months of the year.
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After doing and exhaustive study of internal and external aspects for this business
opportunity it is time to analyze and evaluate them to be able to measure them and take
action if needed to take advantage or fight back some of these aspects. From this study is
meant to take some strategies to improve the corporate fit with the environment and against
the competitors.
After a long and deep external analysis of plenty of different facts that can affect to the Sky
Casino business outside the company itself some of them have been assessed and chosen as
the most important from the ones explained before. These are the Opportunities and Threats
selected:
As Opportunities:
- Nearby MRO Suppliers

- Strong gaming culture in China and Australia
- Drop in A380 prices
- Easy connection all over the world due to HUB Airports
- Increasingly big market. Many potential customers
- Small number of Casinos in China and Australia
As Threats:
- Gaming banned in mainland China

- Restricted airports to A380 operations
- New configuration of A380 Casino. Certification Required
- Seasonal weather threats in Southeastern Asia
- Strong competitors in air transport business
One the other hand are Strengths and Weaknesses. These are the most important from the
ones reached in the internal analysis.
As Strengths:
- Pioneer and innovative service

- Excellent customer service
- Knowledge in aerospace business
- Business attractiveness
- Advantageous location choice. (China-Australia)
- Tax exemption for gamblers winnings
As Weaknesses:
- Lack of knowledge in gaming business

- Irregular income source from gaming
- High fixed costs.
- Irregular income source from gaming
- Lack of networking in the area or market
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Here the cross interactions between internal and external facts have been graded. Positive
values if they are positive to the business or negative values if the can affect against the
company or the business flow. Then the accumulated value of this cross interactions allows
to rank the different aspects in importance order. Having that in mind the next aspects are
the most important for the business.
As Opportunities:
- Strong gaming culture in China and Australia

- Increasingly big market. Many potential customers
As Threats:
- Gaming banned in mainland China

- Restricted airports to A380 operations
As Strengths:
- Pioneer and innovative service

- Advantageous location choice. (China-Australia)
As Weaknesses:
- Lack of networking in the area or market
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The most important part of this whole analysis are the strategic resolutions that have to be
implemented afterwards to ensure the best performance of the company. Taking into account
the graphic and values before some conclusions can be extracted from each quarter of the
graphic. In this next lines they will be studied quarter by quarter and explained the resolutions
extracted from the most important cross references of each one.
Correct. Reorientation strategies

This part is meant to study the possibility of taking advantage of the opportunities in order to
correct the weaknesses. Having this in mind the situation is the next one, “Lack of networking
in the Asian area” crossed with “Strong gaming culture in China and Australia” and
“Increasingly big market”. Thinking about those the next strategies come forward:
- Casino Partnerships: This appears as a key point to fight some weaknesses such as
lack of networking or experience in gaming business. They can act as a strong source
of customers and we can serve as a promotion or as a way to bring clients to the
Casinos doorstep. Also, partnerships with digital casinos can be very productive. They
can get the most cutting edge facilities for their physical finals of their tournaments
and customers sharing that could create a Win-Win relationships. Some crossed
promotions to increase gaming activities on each other can be interesting too.
- Take advantage of Australian institutions. As an Australian based enterprise (for
taxes exceptions for gambler earnings) we can also ask for sponsorship from
institutions such as the Australian Chamber. This can increase the networking in the
Asian area.
- Subcontract MRO services: Having them authorized in the area and that would allow
to decrease a little the high fixed cost inherent to this kind of business. This affect to
other opportunities and weaknesses apart from the most important ones.
Adapt. Survival Strategies

Here are faced the most critical parts of the SWOT. Is tried to find strategies to adapt to the
threats not allowing any grow of the weaknesses. In this case, again “Lack of networking in
the area” with “Gaming banned in Mainland China” and “Restricted Airports for A380
operations” are the most important crosses but not the only ones. The strategies selected are
the next ones:
- Strong partnerships with strong businesses oriented to similar customers. There are
strong competitors in the air traffic business and not many in the gaming business.
This makes key to have strong partnerships with businesses that are premium sector
oriented as well. For example, high quality hotels such as Oriental Mandarin or
premium activities contractors such as Bluefish.
- Aircraft handling subcontract. To take advantage of one threat it is suggested to
subcontract this and other airport related services. There is a strong competition in
the air transport business in the area with some of the biggest airlines in the world
operating in the same airports and lines. This makes that they have the handling and
airport services fully optimized and compatible with the A380 planes in their
operations. So to have the same service without any investment and for a better price
than doing it on our own we should subcontract all airport related services to this
companies systems.
- Local Airline Partnership. This option is studied but this would mean a total loss of
control over the business. On the bright side, it would make Sky Casino appear as a
local service provider and could mean a faster adoption of the product and some
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sympathy by the customer. But with this action the maneuver alternative would be
significantly reduced and this enterprise itself would lose sense to become a business
line of another company.
Maintain. Defence Strategies

Here the cross between strengths and threats is studied. The most important aspects here
are “Pioneer and innovative service” and “Advantageous location choice in China and
Australia” with the threats like “Gaming banned in Mainland China” and “Restricted Airports
for A380 operations” among others. The actions to defend from the threats are:
- Strong Branding Knowledge. This appears all over the SWOT analysis as a key point
and it will be tackle thoroughly in the Marketing Plan in the following pages. As a new
product and an innovative service one of the most important key points of the project
is to get people to know it, consider it and buy it. It must be done carefully having in
mind that Gambling is forbidden in Mainland China while it the country where people
is more inclined to gambling in the world.
- Make a program of planned maintenance matching the worst weather season.
Maintenance operations are compulsory for an aircraft. Having enough data about
the weather allows to make them match with the expected worst season. Making the
most from a possible threat.
Explore. Attack Strategies

Here we approach the last and most favorable crosses, strengths with opportunities. Here is
where is meant to take the most advantage possible from competitors. The attack strategies
are:
- Strong Branding Knowledge. Again, a pioneer service with an environment eager to

fill this need is the core origin of this business idea. But for making it possible is
absolutely indispensable to get people to know that this service exists at all.
Marketing looks again the most important aspect of this proposal.
- Use of specific channels to target potential customers. Digital and physical channels
to target customers are essential. Some are strongly based on partnerships presented
before like Premium Hotels or Services, Casinos, Digital gaming Websites… This allow
direct connection to potential customer interested in the product. A tremendous
customer stream can be catch from this.
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When you’re starting a business plan, first you need to have
a deep understanding of your customers. In fact, knowing
your customers inside and out is probably the most
important key to success. We will do a research to include
our company in a current marketing position, describing our
marketing strategy to achieve our goals.
A systematic process will applied to take that business idea

into an executable commercial plan.
Firstly, a market research is performed where the most

appropriated target segment is chosen. After that, the size
of the potential market is estimated for the chosen
segment and the needs of the Customer are stated with a
Value Proposition.
Once we have the wishes of the target Customer, the

product will be designed and matched with the appropriate
price. Finally, a Commercial Plan will be developed to
ensure that the product reaches the Customer through the
right channels of Promotion and Placement (Sales).
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The segmentation criteria is done by a brainstorming of dimensions and axes. We
contemplate all of the criteria that could be relevant for our company, taking into account
different attributes, which are:
Dimensions/Axes
Demographic Uses and behaviour Attitudes and needs
Age: 18 – 80 Travel frequency Comfort
Income level Travel proposal Customizing
Gender Gambling attractiveness Design
Socialize /
Type of family Travelling destination
communication
Number of children Travelling budget Free time
Nationality Mobility
Education Level Quality
Lifestyle Price
Profession
Hobbies
Location of Residence
Once we have our brainstorming, we have to prioritise the dimensions/axes and take these
two which are more appropriate for our business idea described in the introduction.
Priorization dimensions / axes

GAMBLING ATTRACTIVENESS
INCOME LEVEL
TRAVELLING BUDGET
TRAVEL FRECUENCY
LOCATION OF RESIDENCE
PROFESSION
HOBBIES
NACIONALITY
PRICE
QUALITY
TRAVELLING DESTINATION
LIFESTYLE
EDUCATION LEVEL
COMFORT
CUSTOMIZING
DESIGN
MOBILITY
SOCIALIZE / COMMUNICATION
TRAVEL PROPOSAL
FREE TIME
GENDER
AGE: 18 – 70
TYPE OF FAMILY
NUMBER OF CHILDREN
0 1 2 3 4 5 6 7 8 9 10
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As our business idea is a Business Quality Travel with the opportunity of gaming while flying,
we focused on people with high gambling attractiveness and high level of income (high net
worth individuals) also regular travellers rather than middle class tourists because they have
a more intensive use of predictable routs matching with the experience that we offer and
therefore Casino Sky would be able to target key routs with the high quality standards they
demand. Once this broad segmentation is defined and integrated within our business idea we
can proceed to a more detailed one.
With the two principal axes we have choose, a segmentation hypothesis have been
developed to better understand the difference between the distinct companies.
SEGMENTATION MATRIX
12
10
Level of income (Av.)
Low cost Airlines

8
Luxury Airlines
6 Low bet Casinos
High bet Casinos

4
SkyCasino
2
0
-2 0 2 4 6 8 10 12
-2
Gambling Attractiveness
In our segmentation matrix Sky Casino was compared with the principal competitors
explained in the external analysis.
Customer Value
Regarding the previous graph, as we shift to the right, it is normal to find more commitment
with our company due to the fact that we will have a more relevant position for those people
who love gambling and can enjoy it travelling.
On the other hand, it is important to remark that an inverse correlation exists between the
size of the segment and the price the customers would be willing to pay. Thus, it will be taken
as a constant at this step and used later while selecting the features of the product.
Competitive Fit
The competitive fit must take into account that this is an innovative business with not direct
competitors in our market, as we are pioneer.
The Porter’s 5 Forces analysis was used to address it since it is the most complete and
recognized one tool for these matters. On Porter’s 5 Forces we analysed competitors in each
of our core business separately: air transport business, where we see the main alternatives to
our airline for the transport between the above mentioned countries, and gaming industry
competitors, where we will see alternatives to our flying casino in both countries.
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Regarding the following numbers, and adding the abstract features we can analyse the
capability to compete of our service against the competitors.
Lowest
Ticket Price Passenger Ticket Class Services
Bet
Low cost Cost-
$500 250 Economy class
Airlines competitive
Qualities
Luxury $1500 - service,
250-500 Economy - First Class
Airlines $6000 Respecting
relationships
Low bet
$5 Bet-competitive
Casinos
High bet Shops, Hotels,
$1.200
Casinos etc.
Casino a board,
Sky Casino $3.800 160 Business Class
Qualities service
In the table above, we can state that our service holds the following key: we are offering a
competitive price, within the range of price of Luxury Airlines that offer a qualitative service
like us. The capacity is more limited that the others, but this limitation is because of the
configuration of our A380. Our configuration has only one class, business class to avoid
problems related to the passengers and we offer the most innovative experience on board.
Once we know the customer value and competitive fit, we are ready to prepare the
Segmentation Matrix in order to prioritize the customers which will maximize our profits.
PRIORIZATION MATRIX
12
10
8
Value
0
0 0,5 1 1,5 2 2,5 3 3,5 4 4,5 5
Competitive FIT
Low cost Airlines Luxury Airlines Low bet Casinos

High bet Casinos SkyCasino
As expected from the comparison above, Casino Sky is in the best positioning, trying to cover
all the customer needs.
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Once our target segment has been selected, it is necessary to explore and understand the
nearby environment in order to make the choices which lead us to reach the best performance
in the area.
Qualitative and Quantitative Market Analysis

A qualitative and quantitative analysis, it is necessary to go in depth studying the main areas
where our company would have success. To do that, a chart has been built which allows to
estimate the amount of target customers that could be found.
Nº INHABITANTS
China Australia
1377 M 23 M
HNWI HNWI
1,59 M 1,06 M
Guandong New South Wales

104,3 M 7,7 M
HNWI HNWI
120 K 355 K
GAMING
China Australia
53% 80%
Gamnlers HNWI Gamblers HNWI
63,83 K 284,04 K
Potencial Customer
347,87 K
First of all, we have analysed the population in China and Australia, finding a quite size
difference. In China there are 137 people per km2 while in Australia only 2 people. But that
is not a big concern for us. As we have focused in High Net Worth Individual (HNWIs),
those having investable assets of US$1 million or more, excluding primary residence,
collectibles, consumables and consumer durables. To get more information about these
people, we have based in an important report, “World Wealth Report 2016”, issued annually
by the Credit Suisse Research Institute. Is one of the key sources of intelligence in relation
P a g e 29 | 139
to global wealth development, and delivers extensive estimates of global household wealth
levels, covering all regions and population segments. Within it, we have got the principal
numbers of HNWIs in each region, as you can see above. But we cannot consider the whole
region, due to we offer our service only in two main cities, Hong Kong and Sydney. Thus,
our influence area would be Guangdong and New South Wales, both provinces of our
chosen cities. This range could be even bigger, but for a first estimation this will be our
scope.
New South Wales
Guangdong
The estimation of the numbers of HNWIs in each region is done taking into account that in
China 0.2% of people have more than US$1 to invest and in Australia that figure reach a 6%.
Once we have estimated the density of wealthy population in each selected areas, we focus
on these people with a high level of gambling attractiveness, our customer segmentation
chosen. Gambling is an activity undertaken by many Australians and Chinese. Over 80% of
Australian adults engage in gambling of some kind, which is the highest rate of gambling in
the world and 53% of Chinese are gambling addicted, so our target customers amount to
347.87K people, a big opportunity for our business.
After the analysis of our potential customer, we have to calculate our market share, as is an
important indicator of the strengths of a business within its markets. This first approach is
based on some estimation about the average demand, revenues per flight and COGS per
flight, considering one flight per day.
Passengers flight year

Total capacity 160 56.000
Average occupation 96 33.600
Hours flying 9
Hours gaming a board 6
Flights / years 350
Tickets flight
Round trip 4.000
One flight 2.000
Gaming pax/hour
Invest 600
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Revenues
Tickets revenues/ flight 192.000 Gaming revenues/flight 345.600
Total Revenues / flight 537.600
Cost of Goods Sold

Fixed Costs/flight Variable Costs/flight
Leasing 72.000 Food & Drinks 2.000
Fuel 153.000 MRO 15.000
Crew 3.000
Airport Fees 157.000
Total COGS / flight 402.000
Gross Margin
Gross Margin / flight 135.600
Market share 9,66% BEP 72 passengers
The average of passengers is calculated taking an average of 60% of total occupation of our
flight, which is an average of 96 passenger per flight, coming to add 33.600 passenger
annually. Within this count another estimation is the number of flight a year, 350, because
as you can find in depth in Operational Plan, an aircraft needs some maintenance per year, so
15 days are taken as the plane is not operative. The duration of the route is about 9h, but we
have to take in consideration the take off and the landing timing, turbulence and the time to
reach the cruise speed, meaning that gaming will be available during approximately 6 hours
per flight.
The gaming revenues, after a depth analysis are estimated 600$ per hour per passenger, this
number is the most variable and represent a mean of the bet per hand of a HNWI. So, as
summary, the revenues rise to $537.600 per flight.
The cost are also estimated on based of the number of flight, taking into account a leasing of
5 years, the expenses on fuel per operating hour, and the personal expenses in a flight,
average of cost in food and drinks per flight and the expenses in MRO. All of these costs will
be in depth explained in the Operational Plan. Thus, the total costs rise to $402.00 per flight.
The number of customers to reach BEP would be around 72, all the difference between 72
and 160 means more probability to effectively satisfy customer demand, especially at early
implementation.
As the market share obtained is very low, only 9.66%, we are up to offer a new flight that
means two flights per day, in terms to cover the huge demand and make our company more
profitable. So, our second approach represents the following numbers:
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Passengers Flight Year
Total capacity 160 104.000
Average occupation 96 62.400
Hours flying 9
Hours gaming a board 6
Flights / years 650
Tickets Flight
Round trip 4.000
One flight 2.000
Gaming PAX/Hour
Invest 600
Revenues
Tickets revenues/ flight 192.000 Gaming revenues/flight 345.600
Total Revenues / flight 537.600
Cost of Goods Sold

Fixed Costs/flight Variable Costs/flight
Leasing 38.769 Food & Drinks 1.800
Fuel 145.000 MRO 14.500
Crew 3.000
Airport Fees 118.354
Total COGS / flight 321.423
Gross Margin
Gross Margin / flight 216.177
Market share 17,94% BEP 57 passengers
The results obtained on the second approach are more feasible, we reach a normal market
share for a first lunch of a business. The earnings per flight remain constants, but the COGS
comes down with the number of flights, due to the distribution of costs in the fees of the
Airports, the leasing, fuel and foods. It is more sustainable while more flights we make. Thus,
the results come better when we increase our services.
So, as to sum up, our assumptions are the following ones:
- We operate 650 flights per year, approximately 2 flights a day

- The average occupation is 96 passengers per flight
- Gaming is available 6 hours in a flight
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- A person invest in gaming a mean of $600 per hour
- The round trip ticket is $4.000
- The revenues in a flight are estimated about $537.600
- The COGS per flights rise up to $321.423
- The Gross Margin obtained in a flight is $216.177
- The calculating market share is 17.94% for the first year.
The number of customers to reach BEP would be around 57
Perceived Benefits
Based on different research done throughout the business development about the
customers and Australia and China Environment, gambling and flying analysis and business
conclusions, we are able to establish a ranking on the needs and wishes that those
customers have.
Competitors
Customer prioritization
fit
Boarding experience 10 4
Quality of the loyalty program 9.5 7
seat comfort 9 6
Entertainment 9 6.5
Cleaning 8.5 7
Customer attention 8 7
Space for legs 7 5
Food & drinks 7 5
Billing & boarding 6 6
Value for money 5 4
Competitive positioning could be shown with the comparison between Customer

prioritization of benefits and competitors fit based on previous studies. This diamond shows
the niches that are able to be covered by SkyCasino.
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Treatment customized
Customer priorization Competitors fit
Boarding experience
Value for money Quality of the loyalty…
Billing & boarding seat confort
Food & drinks Entertainment
Space for legs Cleaning

Customer attention
The dark blue represents the gap of improvement starting from the current competitive
situation. The next graph shows in what SkyCasino should focus to guarantee competitive fit.
Features Matrix
Boarding experience
Quality of the loyalty

program
BENEFIT IMPORTANCE
seat confort
Entertainment
Cleaning
Customer attention
Space for legs
Food & drinks

COMPETITIVE FIT
Billing & boarding
As it could be appreciated within the matrix, there are more than an outstanding benefit.
Nevertheless, experience on board, is the most important feature in order to get the higher
benefits and the one with Sky Casino has closed perfect competitive fit.
Thus, our competitive positioning would be:
“A unique experience with the best comfort and customer attention for selected customer”
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As the opportunities found until now has been occupying the gap in the market for airlines
taking advantage of A380 sales and the huge increasing in flights between Asia and Oceanya.
Besides the need of customers of enjoying a unique experience.
Furthermore, as Asiatic and Australian are, with a great difference, the gamblers of the world,
Sky Casino is satisfying this demand with plenty of bet games.
Features associated to benefits

It is important to remark that a Customer does not perceive the features that the company
has
but the benefits that those imply. According to that, as has been stated in the “Value
Proposition” section, there are key benefits which are really important for the market segment
in which we are focus on.
Thus, these benefits are listed just below with a relation of Features that lead to them:
Experience On-board
- Casino’s Games
- Luxury rest spots
Quality of the loyalty program
- VIP Club Membership

- Full year Pass
Seat comfort
- Luxury Furnishing
- Trained crew
Entertainment
- Latest digital devices

- Social games
Food & drinks
- Free high quality food and drinks
Hence, there is now a relation of features that should be prioritized in order to develop a full
product strategy.
Benefits achievement
For the prioritization mentioned above, it is necessary to take into account two factors:
- How much each feature contributes to each benefit (Attractiveness for

Customer).
- How much it will cost to the company (Feasibility)
In order to evaluate how much each feature contributes to each benefit, there will be
developing a matrix as follows:
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Quality of
Food
Attractiveness Boarding the Seat
Entertainment & Total
for Customer experience loyalty comfort
drinks
program
Casino’s
Games
4 4 8
Luxury rest
spots
3 2 2 7
VIP Club
Membership
4 4
Full year Pass 4 4
Luxury
Furnishing
3 3
Trained crew 2 3 5
Latest digital
devices
4 4
Social games 1 4 5
Free high
quality food 2 4 6
and drinks
On the other hand, it is also necessary to perform the same analysis for the feasibility of
implementing each feature.
Feasibility
Casino’s Games Legislation – New aircraft configuration
Luxury rest spots High Cost
VIP Club Membership Moderate management difficulties
Full year Pass Moderate difficulties in forecast and
management
Luxury Furnishing High Cost
Trained crew Cost in training
Latest digital devices High Cost
Social games Legislation
Free high quality food and drinks High Cost
Now, it can be shown in a matrix what makes it more visual.
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Atractiveness
VIP Club Membership
Full year Pass
Luxury Furnishing
Trained crew
Feasibility
Latest digital devices
Casino`s Games
Free high quality food

and drinks
Luxury Rest Spots H
Product Development Strategy

Taking into account the previous results, it looks obvious that, those which are feasible and
attractive for customers will be prioritized to the others (GREEN AREA). The rest of them are
attractive but less feasible or the contrary (YELLOW AREA). Nevertheless, they will be
included in the product definition, although, will be the first one in being cut out if the
company has lack of resources.
None of the features is considered as a non-attractive as well as non-feasible (RED AREA).
Regarding to these previous considerations, features will be ranked in order to establish the
strategy of prioritization of the product.
1. Casinos’ Games 5. Trained crew

2. Luxury Furnishing 6. Full year Pass
3. VIP Club Membership 7. Free high quality food and drinks
4. Luxury Rest Spots 8. Latest digital devices
Casinos’ Games
The implementation of bet games inside an A380 meets the conditions for validation of a new
project to be implemented:
SUSTAINABLE
PROGRESSIVE
ACTIONABLE
CAPABLE TO STIMULATE
EVOLVE
0 0,2 0,4 0,6 0,8 1 1,2
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As Casinos’ Games have been selected as the most important product to implement in the
A380 due to his attractiveness and his feasibility, it is important to rank the kind of games to
spread.
The following chart has the annual revenue totals for the seven most popular casino games
in Macau (Centre For Gaming Research UNLV). All other games, which include fantan, paikao
(pai gow), mahjong paikao, craps, boule, fish-prawn-crab cussec, Q poker, football poker, 3-
card poker, Fortune 3-card poker, Texas hold'em (live poker), 3-card baccarat, fortune 8,
tombola, and lucky wheel (known in the US as "Big Six), are in the "Other" category. And
Cussec is also known as Sic Bo in American casinos; Stud Poker is a house-banked game like
Caribbean Stud Poker.
Year VIP Baccarat Blackjack Roulette Cussec Stud Poker Slots Other Total
Baccarat
2002 $0.20 M $0.34 M $0.07 M $0.01 M $0.08 M $0.00 M $0.03 M $0.20 M $0.28 M
2003 $2.77 M $0.39 M $0.08 M $0.01 M $0.09 M $0.00 M $0.03 M $0.22 M $3.58 M
2004 $3.72 M $0.75 M $0.15 M $0.02 M $0.15 M $0.04 M $0.08 M $0.26 M $5.17 M
2005 $3.61 M $1.31 M $0.18 M $0.02 M $0.19 M $0.07 M $0.02 M $0.22 M $5.76 M
2006 $4.60 M $1.49 M $0.20 M $0.03 M $0.24 M $0.07 M $0.26 M $0.19 M $7.08 M
2007 $6.97 M $2.06 M $0.24 M $0.05 M $0.34 M $0.09 M $0.45 M $0.17 M $10.38 M
2008 $9.22 M $2.66 M $0.28 M $0.09 M $0.38 M $0.12 M $0.71 M $0.15 M $13.60 M
2009 $9.98 M $3.19 M $0.24 M $0.09 M $0.35 M $0.12 M $0.81 M $0.15 M $14.92 M
2010 $16.96 M $4.36 M $0.03 M $0.08 M $0.44 M $0.01 M $1.08 M $0.20 M $23.54 M
2011 $24.52 M $6.08 M $0.34 M $0.10 M $0.60 M $0.16 M $1.43 M $0.26 M $33.48 M
2012 $26.36 M $8.28 M $0.04 M $0.11 M $0.69 M $0.18 M $1.66 M $0.37 M $38.02 M
2013 $29.82 M $11.45 M $0.38 M $0.12 M $0.84 M $0.21 M $1.80 M $0.48 M $45.09 M
2014 $26.57 M $13.32 M $0.37 M $0.13 M $0.95 M $0.20 M $1.81 M $0.06 M $43.94 M
2015 $15.98 M $9.40 M $0.29 M $0.12 M $0.79 M $0.14 M $1.47 M $0.66 M $28.86 M
These figures have been represented in a bar diagram just to supply the conclusion with a
glance:
Casinos' Revenues By Game

$50,00 M
$40,00 M
$30,00 M
$20,00 M
$10,00 M
$0,00 M
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
VIP Baccarat Baccarat Blackjack Roulette Cussec Stud Poker Slots
P a g e 38 | 139
Hence, the chart is telling us to focus on VIP Baccarat as main kind of casino game for our
A380. As Sky Casino has decided to promote high social relation between all of our customer,
slot machines are discarded.
2015 Revenue
Other
Slots
Stud Poker
Cussec
Roulette
Blackjack
Baccarat
VIP Baccarat
$0,10 M $1,00 M $10,00 M $100,00 M
The graph above shows us the other main streams of income for a Casino, thus we will try to
merge some of this so as not to lose any potential customers.
Once we know about the principal games for a gamble customer, Sky Casino has analysed the
amount of tables for the 7 most important casinos in Macau and the associated net profit per
day per table. These data could be appreciated below:
Tables in time
$25.000,00 7.000
# Tables Win/table/day ($)
6.000
$20.000,00
5.000
$15.000,00 4.000
$10.000,00 3.000
2.000
$5.000,00
1.000
$- 0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
On the other hand, trying to optimize the profitability of our company, house advantages for
major casinos wagers have been analysed to decide which kind of game implement and how
many of them.
P a g e 39 | 139
House Advantages for Major Casino Wagers
Game Bet HA*
Baccarat Banker (5% commission) 1.06%
Baccarat Player 1.24%
Big Six Wheel Average 19.84%
Blackjack Card-Counting -1.00%
Blackjack Basic Strategy 0.50%
Blackjack Average player 2.00%
Blackjack Poor Player 4.00%
Caribbean Stud Ante 5.22%
Casino War Basic Bet 2.88%
Keno Typical 27.00%
Let It Ride Base bet 3.51%
Pai Gow Poker Skilled player (non-banker) 2.54%
Pai Gow Poker Average player (non-banker) 2.84%
Red Dog Basic bet (six decks) 2.80%
Roulette Single-zero 2.70%
Roulette Double-zero (except five-number) 5.26%
Roulette Double-zero, five-number bet 7.89%
Three Card Poker Pair Plus 2.32%
Three Card Poker Ante 3.37%
Video Poker Selected Machines -0.50%
Accordingly, taking into account the limited space, Sky Casino has chosen the most profitable
configuration, in social bet games terms as it is shown below:
Player
Capacity
Size (m) Area (m2) Capacity Tables
Playing
per game
Baccarat Table 3,05x4,88 15 m 16 4 64
Blackjack 2,13x2,13 5m 7 6 42
As summary up to 106 people would be able to play simultaneously and the total amount of
tables (10) will occupy a useful space of 90 m2 (47,5% of the useful area and 32.7% of the
total area of the plant).
According to “A Study of Gambling Motivations of High Rollers from Mainland China” by

Zhonglu Zeng, Professor & Ph.D (Macao Polytechnic Institute), the average spent in gambling
(source: the economist), the target population, and wealth distribution for HNIW, we assume
that each passenger will spent $600 per effective hour flying and playing. Meaning, this
segment will spent among 3 and 6 times more than the average, assuming a monthly budget
for gaming.
P a g e 40 | 139
Luxury Furnishing
The last furniture will be bought according to the free budget for this game.
VIP Club Membership

It will create a club for VIP clients with the goal of achieving a fixed income during each year.
This club will focus on enhancing the perceived value of our most exclusive clients.
Luxury Rest Spots

Luxury seats designed by the manufacturer will be installed.
Trained crew
A crew formed in casino games and with a flight attendant and / or pilot license will be hired
according to the required position.
Full year Pass

A full year pass will be created for VIP clients with the objective of obtaining a fixed income
during each year.
Free high quality food and drinks

In order that our customers enjoy a unique flight and game experience, food and beverages
of all kinds of high quality will be included in the price.
Latest digital devices

As far as possible, the latest technology will be available in all types of devices.
With the features of the product stablished, it will be necessary to put the right price to it.
For that, it will be deployed the “Pricing Diamond Structure” showed below:
Use promotions and communication in Concrete the

order to seem cheaper than you really are optimal pricing
positioning
4. Manage price perception 1. Define the price strategy
Understand customer princing

behaviour and sensivity
3. Manage the pricing at 2. Design the pricing

individual level structure
Use different discounts depending on Establish the
the customer value/need/moment optimal pricing
structure
In that way, it will be possible to develop a full pricing strategy regarding strategy, structure,
discounts and perception.
Pricing strategy
There are many ways to settle a price, in our case, we will do that by three different
approaches. Those approaches will give constraints, so finally, we will be able to set a price
taking into account the most important factors for a company: A price over the Cost of the
company, a price that customer is willing to pay and at the same time, a price that is
competitive compared with the market
P a g e 41 | 139
Minimum price & other constrains (cost +)
In accordance with financial department, the price for what the company will have a
profitability of 0% will be US$587,5.
Price willing to pay (demand basis)

Price willing to pay will be the most competitive so it will be settle in the next step.
As CAPA Centre for aviation studies states about the China-Australia aviation, the growth in
Chinese airports with service to Australia coincides with growing Australia-China non-stop
city pairs: from nine in 2013 to 21 in 2016. Furthermore, even before the rush of additional
capacity that largely commenced in Dec-2015, Nov-2015 proved to be a record-breaking
month for Chinese visitors to Australia. A 26% increase in visitors in Nov-2015 took the 12
months to Nov-2015 to being the first year in which Chinese visitors to Australia exceeded
one million.
As a rough approach, it is represented the percentage of customers willing to pay our ticket:
% of customer will buy
15
20 12
10
8
40
35
30
25 6
20
10 2 1
3 3
$2.400,00 $2.750,00 $3.100,00 $3.450,00 $3.800,00 $4.150,00 $4.500,00 $4.850,00
I will buy it Probably
As it is shown in the bar diagram below, the margin is growing constantly as far as we increase
the ticket price:
Margin
€6.000,00
€5.000,00
$5.101,84
€4.000,00 $4.751,84
$4.401,84
$4.051,84
€3.000,00 $3.701,84
$3.351,84
$3.001,84
€2.000,00 $2.651,84
€1.000,00
€-
$2.400,00 $2.750,00 $3.100,00 $3.450,00 $3.800,00 $4.150,00 $4.500,00 $4.850,00
In the chart below is given the % potential customers depending on the ticket price, the
margin and the profit per 100 potential clients:
P a g e 42 | 139
$80.000,00 25
$70.000,00
20
$60.000,00
$50.000,00 15
$40.000,00 Margin
$30.000,00 10
Profit
$20.000,00
5
$10.000,00
$- 0
$2.500,00 $3.000,00 $3.500,00 $4.000,00 $4.500,00
Therefore the selected price is $ 3.800,00 (return) as it is the optimum one to maximize
benefits according to number of potential customer and the operative margin.
For the optimal price for maximize the net income, it is represented the net income, revenues
and cost per occupancy level per way.
Income per amount of passengers

$1.200.000,00
$1.000.000,00
$800.000,00
$600.000,00
$400.000,00
$200.000,00
$-
0 20 40 60 80 100 120 140 160 180
-$200.000,00
-$400.000,00
Net Fix Var Rev
Thus, this analysis provides us the break-even point which is an average occupancy of 57
passengers is we achieved 650 flights per year and 72 for 350 flights.
As we desire, and deserve, have no any free spot inside the aircraft, we have made an
estimation of the occupancy level in time which is shown below:
P a g e 43 | 139
Expected selling evolution
200
180
160
140
120
100
80
60
40
20
0
-100 -80 -60 -40 -20 0
Price benchmarking (competitor basis)

It has been studied the business class price per ticket in that segment in order to have a competitive
price.
P a g e 44 | 139
Qantas Airways China southern Charter
Cathay Pacific
Airline / Mean Limited Airlines (stop Charter
(First)
(business) (First) midway)
Return Price $3.730,00 $5.080,00 $7.271,84 $50.000,00 $100.000,00
Pax. (First,
Business and 114 78 93 8 8
premium)
Pax (Economy) 371 428 182 0 0
Revenues (Full
$3.422.746,25 $841.116,00 $853.292,67 - -
A/C)
Another point that needs to be taken into consideration is that, with respect to Qantas fleet,
only their A380 has VIP class configurations, therefore every connection not being made with
said aircraft (out of high season is not very used in this route), we offer a clear alternative of
high quality level with another high income stream from gambling
The same way, southern airlines, when they do not use their airplanes with VIP class
configuration we would be de high class alternative.
As could be deduced by the figures above in the table, the more not economy pax, the higher
revenue. Due to compete with airlines focus on this category our return ticket must be around
$3.500 – $7.200.
Pricing Structure
The pricing structure should maximize the relation between the perceived benefit and the
perceived price.
In order to achieve fill the plane, we have analysed and designed a variable ticket price
program based on the number of tickets sold at that time and the expected level of sales:
Ticket Price in time
$10.000,00
$9.000,00
$8.000,00
$7.000,00 180
TICKET PRICE
$6.000,00 121
# TICKET SOLD
$5.000,00 81
$4.000,00
54
$3.000,00
$2.000,00 36
$1.000,00
$- 24
-100 -80 -60 -40 -20 0
DAYS BEFORE FLYING
P a g e 45 | 139
The prices have been fixed in a way that we will get profit for every travel, no matter if the
plane is not full of passengers, but the price structure strategy is design for it.
Time
Tickets -100 -80 -60 -40 -20 0
sold
24 $ $ $ $ $ $
3,800.00 3,454.30 3,030.08 2,681.49 2,373.00 2,100.00
36 $ $ $ $ $ $
4,000.00 3,800.00 3,686.00 3,575.42 2,500.00 2,150.00
54 $ $ $ $ $ $
4,200.00 4,050.00 3,800.00 3,600.00 3,500.00 2,200.00
81 $ $ $ $ $ $
4,500.00 4,250.00 4,000.00 3,800.00 3,600.00 2,250.00
121 $ $ $ $ $ $
5,000.00 4,700.00 4,200.00 4,000.00 3,800.00 2,300.00
180 $ $ $ $ $ $
10,000.00 8,000.00 6,400.00 5,120.00 4,096.00 3,800.00
Price Discount
It has to be taken into consideration that Sky Casino is a new concept of flying within this
area.
It is really important to avoid barriers at that point between the customer and the company.
There will be different kind of discount:
Trial discount for influencers

In order to capture customer, it will be offer some free pass for certain influencers (Poker
stars) of our potential clients in order to improve the capacity of being considered and bought.
A full year pass payment

In order to capture a strong fix income stream, everyone could have a fix spot for a complete
year for $ 971.565,00, which is equivalent of a 30% of discount.
Partnership deals
As Sky Casino is making partnership with main Casinos, hotels and online bet companies a
discount of 5% will be offer to membership and staffing from our partners.
Corporative Business Trips

Our company will offer a discount for business groups. Since a 5% for small groups (2-6
people) and an 8% for big groups.
Price perception
In order to surpass pricing issues, Sky Casino has planned a way to mitigate the client
perception:
Pricing issue Mitigation Customer perception

Paying that amount for
being fix member, I could fly
High cost per ticket A full year pass
as much as I am able to in
first class.
First approach to the Trial discount for Boosting steps of
company influencers consideration and buying
P a g e 46 | 139
Besides, as our price structure is defined by time, the perception of the price will be as follows:
Pricing Perception
$12.000,00
$10.000,00
$8.000,00
$6.200,00
$6.000,00
$10.000,00
$4.000,00
$2.000,00 $3.800,00
$-
Max price Bargain Std Price
Once the product and pricing strategies for our service has already been defined, an accurate
communication and publicity plan must be design in order to optimize the perceived value
and communicate the benefits of our service.
This plan supports our mission and objectives laid out in our strategic plan. It allows us to
focus our marketing and communications, making sure that all activities work together to
support the big picture. And because it allows us to build the components of Sky Casino brand,
identity and everything in between.
Our communication and publicity plan follows 7 essential features:
 It is participative  It combines the best of PR and

 It is dynamic Marketing
 It is flexible  It contains a mix of strategy and
 It is audience-driven tactics
 It is doable
Customer buying process

There is a model of the Buying Process in which, through a funnel, it is stated the different
steps that potential customers follow. According to that, certain percentage of potential
customers is lost in each phase of the funnel until certain number of them buys the product
and fidelity is created.
Besides, in order to minimize those losses of potential customer, there are some specific
levers that have to be well designed. The levers are showed below.
Knowledge Consideration Buy Loyalty
P a g e 47 | 139
Main Level
Service
Brand Promotion Product Promotion Placement
Accomplishment
Secondary Levers
Product & Price
As “Commercial Offer (Product & Pricing)” has been already defined, it will be designed the
“Main Levers” in each step.
Brand promotion strategy

There exist some considerations about the brand itself as it is not just the objective offer but
also how that brand is perceived and the tangible and intangible aspects. In relation to that, it
will be stated below the different aspect through the marketing tool of “Brand Diamond”,
which reflects all those factors.
Intangibles
ORIGIN Innovative & Luck

Fun INTERNAL
REPUTATION Exclusive & Way of
Exclusive
life
Status & Elegance
EXTERNAL
PERSONALITY
Unique & excitement
Luxury PERCEIVED VALUE Global

EVOLUTION
What does the Who and what

Brand offer is the brand
Fast Flight & confort FUNCIONAL Play & Flight

ACTIVITIES
New way of travelling
Casino Aircraft
Bet Games in a A380 PROCESS PRESENTATION configuration & crew
Luxury
Connecting people RELATION CHARACTERISTICS Portfolio meeting
Tailor entertainment
Tangibles
Based on qualitative and quantitative market research conducted on customers, the relevance
of each attribute has been estimated as follows:
P a g e 49 | 139
Relevance for customers
Fun 10
Casino Aircraft configuration & crew 9,5
Status 9
Portfolio meeting 9
Luxury 8,5
Unique 8,5
Flying 8
Play & Flight 8
Exclusive 8
personal relation 7
All around the world 7
Innovative 6
Bet Game 5,5
Furthermore in order to be perceived as best option for our potential customers, prioritize
the main attributes (in terms of the ability to differentiate from competitors) is needed.
Relevance for Customer mark Difference

customers
6 4
Fun 10
2 7,5
Casino Aircraft
configuration & crew
9,5
8 1
Status 9
6 3
Portfolio meeting 9
10 -1,5
Luxury 8,5
5 3,5
Unique 8,5
10 -2
Flying 8
6 2
Play & Flight 8
10 -2
Exclusive 8
personal relation 10 -3
7
All around the world 7 10 -3
Innovative 6 5 1
Bet Game 5,5 2 3,5
Once all of those possible associations of Sky Casino brand have been identified, it is
interesting to state in terms of “Relevance to the Customer” and “Differentiation in the
P a g e 50 | 139
market” the most important ones. In that way, will be show the brand attributes that should
be included in the “Branding Strategy”.
11
Innovative
10
All around the
world
9
Exclusive
8
Relevance
Play & Flight

7
Unique
6
Luxury
5
Portfolio meeting
4
-6 -4 -2 0 2 4 6 8 10
Differentiation
Crossing the data we can see that the key attributes that need to be identified with our brand
are: Casino Aircraft Configuration, Unique and Play&Flight.
Once those main attributes has been selected, it will be identified possible ways of
communication in order to capture the target customer attention. Thus, a unique selling
proposition must be offer to the customer and it must be surprising, simple and seductive if
we want to create interest about our service.
As consumers of luxury products not only seek an exquisite product, but also purchase an
exclusive product. Investing on branding is key to build an atmosphere where everybody
know Sky Casino but only the chosen ones could enjoy it.
According to “The Travel and Lifestyle of Chinese Luxury Traveller 2016 of Hurun Report”, Mobile
phones are essential to the young luxury Chinese traveller. They use their mobile phone to
communicate via WeChat (79%), to browse the Internet (61%), to view photos (58%) and to
shop online (56%). Third party apps are also major travel information sources. Ctrip, Qunar
and Tuniu are the most popular mobile apps.
Young luxury travellers prefer to buy clothing, bags, watches and jewellery – while their
interest in local specialties, electronic products and alcohol is relatively low. On average, over
60% of respondents said clothing, bags, watches and jewellery are their favourite items to
shop for while traveling.
In terms of Young Luxury Travellers’ Hotel Preferences, Hilton Honours attracted the most
new loyalty members amongst young luxury travellers (36%), followed by Golden Circle (29%),
Marriott Rewards (28%), IHG Rewards Club (28%) and SPG (20%). Travelers said that they
would most like to join Golden Circle (17%), followed by Hilton Honours (16%) and IHG
Rewards Club (15%).
P a g e 51 | 139
According to the latest data provided by ILTM and GHC Asia, My Tour, Ctrip, 8 Continents,
HHtravel, Zanadu, MAGIC TRAVEL, Imperial Tours, CITS, CITS Amex, Diadema, CYTS, Wild
China and CTS are the top 12 luxury travel agents in mainland China, Hong Kong,
Barrier to Objective Media Investment Possible Description of

surpass (%) Message the offer
Elements
Chinese
Exclusive Football
Sponsoring 25% Premium League/ basket
Gaming / Big Wall
Marathon / F1
Instagram/
Come, fly
Social Snapchat/
2% with Sky
Media Facebook/
Casino
WeChat
App Ctrip, Qunar
3%
Sponsor and Tuniu
Food, travel
Gourmet
Blogging 4% and gaming
Experience
blogs
Kobe Brain /
Cristiano
Through
19% Be one of us Ronaldo
leadership
@cesar_spa
Increase the @Leaf_greener
Limited knowledge Press Know Sky
5% Creating news
knowledge of coverage Casino
the service Display Start the Gaming on our
3%
banner experience web page
5% Create Web Page,
SEO / SEM
Content Blog,
LOL Final
Championship/
Experience
Events 12% baccarat.
Sky Casino
Knowledge in
airport
Promotions,
Sydney Star
crossed
Partners 20% Casino
fictional
Crown Macau
money
Displayed on
1:1 Mock- How is a
1% the floor of the
up flying Casino
terminal
Promotional
Scale Mock Scale Casino
1% Stand at the
Up Configuration
terminal
Product promotion strategy

As Product advertisement is a non-core activity for the company and at the same time it
requires high level of design knowledge. Therefore, the next work-package will be
subcontracted:
- Advertisement design.
P a g e 52 | 139
- SEOs and web browser management. (Online advertising)
Furthermore, although Advertisement design will be externalized, a draft proposal will be

stated in here in order to reduce costs and assure the strategy alignment with the company
Main activities to surpass the consideration barrier are:
Possible
Barrier to Investment Description
Objective Media Message
surpass (%) of the offer
Elements
Playing
Resting Area at stands in
20% Play while rest
Airport AUS resting
areas
Famous
people and
Free Flights and
Demonstrations 50% influencers
invitations
invitations on
first flights
Convince
Internet/ TV/
people to
Magazines/
Consideration enjoy a
Advertisement 25% Radio/ Apps/ Ads
flight with
Google Ads/
SkyCasino
Facebook Ads
For google Web
SEO 3%
Search improvement
Displayed on
How is a flying
1:1 Mock-up 1% the floor of
Casino
the terminal
Promotional
Scale Casino
Scale Mock Up 1% Stand at the
Configuration
terminal
Placement
Placement refers to the channels in which the product reaches the customer for being bought.
We have considered several possible channels that we will later evaluate through a qualitative
feat and a quantitative ranking. To obtain a list of potential distribution channels we have
considered: Channels used by competitors and substitutive products, Channels used in other
industries that could be effective in ours and finally a few from brainstorming ideas.
Channel Description Source
Crossed promotions with

Sydney Star Casino
Agreements with Casinos fictional money. Buy Sky
Crown Macau
Casino Tickets in the Casino.
Holiday packages. Buy Sky Oriental Mandarin

Agreements with hotels
Casino tickets at the hotel. Four Seasons
P a g e 53 | 139
Crossed promotions with
fictional money. Get Poker stars
Web
Discount paying Sky Casino Baccarat web pages
tickets on the gaming web.
Buy Sky Casino Tickets in
Fitur
Event stands Event Stands and get a
City events
chance of a free travel.
My Tour
Ctrip
8 Continents
HHtravel
Zanadu
MAGIC TRAVEL
Holiday packages
Luxury Travel agencies Imperial Tours
promotions
CITS
CITS Amex
Diadema
CYTS
Wild China
CTS
Junkets buy tickets for
Junkets Direct contact them
gamers
Airbus service for fly in a
Iflya380 Iflya380
A380
Bluefish Buy tickets for Sky Casino Iflya380
Claiming’s physical stand let
Airport Stand Stands
you buy tickets at the airport
Customer Fidelity
Possible
Barrier to Investment Description
Objective Media Message
surpass (%) of the offer
Elements
Club
membership
Be part of
with
VIP Club 45% Sky Casino
preferred
Crew
boarding and
services
Pay a full
year pass
Make Flight as
Full year and take all
customers 30% much as you
Fidelity pass the flights
repeat in our want
you want
service
with us.
Every time
you flight in
Earning Repeat and a year add a
multiplier 25% boost your 2% to your
when repeat earnings earning at
the end of
the travel
P a g e 54 | 139
Commercial Plan Investment strategy
It will be settle two different scenarios to show the variability of strategies in the next coming
years in function of the environment reaction.
Key facts
Year Year 1 Year 2 Year 3 Year 4 Year 4
Average PAX per flight 96 120 136 144 148
# agencies 53 66 75 79 81
# salesman 34 42 48 50 52
# events 10 12 14 14 15
Yearly catchment per 14309 31416 42112 50134 56817

agency
Yearly catchment per 9106 19992 26799 31903 36156
salesmen
Catchment per event 2602 5712 7657 9115 10330
Cost per client uptaken 14309 31416 42112 50134 56817

by an agency
Airport stand leas fee
P a g e 55 | 139
P a g e 56 | 139
In this part of the project the intention is to define the way the company is going to be
organized, how it is going to behave and to take some strategic decision based in the
information obtained so far. Some of the directives taken right now can be modified all along
the project if business implications require so. But this are the basic directives Sky Casino is
trying to stick to.
Quoting a previous part of the project, the portfolio of products is going to be defines now.
There is going to be only one product, same for all customers. The most important piece of
information here is that the product is a Premium Experience of travelling like no one before.
The real added value is what the customer is going to live and not only traveling or gaming. A
new unique service is going to be provided that mixes a Casino entertainment experience
with a comfort travel service. There is going to be provided with a A380 plane with 2 different
space configurations, one on each plane height.
The bottom one is going to be a typical business configuration with comfort seats for
providing a premium travelling experience for all our passengers. There is going to be a
complete “on seat” entertainment merged with a digital gaming alternative to complete the
Casino experience that is going to be provided in the top floor. There is going to be all kind of
on board business class services like quality catering. Meanwhile, as it can be inferred from
the sentence before, on the top floor there is going to be a new certified “Casino like”
configuration, with Poker, Black Jack and Baccarat tables among another Casino alternatives.
All them provided by the best on board staff.
The optimum price is going to be only one. There is not going to be any discount, because it
is a pricing strategy completely opposed to any premium product. But the purchase price
might be variable depending on factor like any other ticket bought from any other airline. All
that optimized to guarantee full occupancy in every travel.
The experience starts with the purchase channels. No matter if you book through the website,
some special app like BlueFish, through a special agency or by your junket like a pro gambler…
The booking is going to be really good taken care of and constantly improving. After booking
and for a price slightly more expensive than a normal business travel you will be able to access
to an international flight in one of the most exclusive planes in the world. An A380, the biggest
commercial aircraft, with a unique configuration. With two heights, the lower one is going to
be a comfortable space with business+ seats and all the accommodations you can expect from
it. Also, gaming is an integrated part in the digital entertainment you can find in your own
seat. Along with a cabin crew dedicated to make the most from your flight with Sky Casino.
But the better part is yet to come. The upper height is the only one space in the world
dedicated to a flying casino. You can dedicate there your usually boring travelling hours in
one exciting journey. Gaming and gambling from poker tables, baccarat or black jack to digital
coin machines. Sonner than expected you’ll be in your destination and who knows, maybe
you have hit the jackpot and you have travelled for free and earned some money with tax
benefits from gaming on board.
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Customer Experience Flow
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Behind this well-defined service based on the customer experiences as a product itself there
is a more important analysis to do. This tries to find what of the previous steps means added
value. With “added value” what is implied is that there are part of the product experience that
suppose value to the customer and can be translate into parts of the product that the
customer is willing to pay. This excludes the aspects that are expected by the customer as
basic services or aspects that only are means to a necessary end. One example of these two
would be, transportation to the airport on one hand, or maintenance for the aircraft on the
other hand.
The total amount of these perceived value aspects are the most important ones and have to
be taken the best care. These are the factors that are creating the final product as a premium
experience.
Next it can be found the Added Value Chain analysis.
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Adde Value Chain
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After this complete analysis, the next logical step is to formulate a Strategy. There has been
found a necessity and it has created a business idea explained in the paragraphs and diagrams
before this lines. It has been defined a service and what is needed to provide it, what is going
to be explained before is how it is going to be provided in the long term. All this is about is to
establish long term goals, were we want to be, and what are the principles in which this
evolution is going to be based.
In the moment of the creation of this company it provides a new, pioneer and innovative
service in an environment that does not know it or the company. So, the obvious first
challenge is marketing and it going to be solved in the next marketing plan but it is not the
subject of this section. So, this business line represents, at first, a blue ocean but can appear
competitor and substitutes quite easily based on the potential of some of the biggest airlines
that operate in the area.
In consequence, after surpassing this first barrier of knowledge, we have to start to think now
on the long term and where Sky Casino wants to be in the future to keep de lead that can be
achieved by being first in the market with this solution.
One of the strategic decision that has been taken before but matters on this section is not to
join/partner with any other airline. This decision is important because of Sky Casino wants to
represent premium specialization and uniqueness attached to the service that it provides. It
is one company that provides one service with the best customer satisfaction. That is what is
going to differentiate it from the best positioned potential competitors, strong stablished
airlines.
Another key point to point strategy towards it is focus. Sky Casino is a whole enterprise with
only one product with one aircraft model and one route to begin with. Growing in number of
planes and services might be and options but focus will be always a top priority to provide a
quality service.
On the other side appears to be the cost leader, the ones with the lower cost as a priority to
base your strategy on it. As always, these are 3 different strategy approaches and you cannot
aim for three of them. You can choose one or two but they put you far away from the third
one. That is why cost leadership is not a strategy priority to Sky Casino.
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After design the service and the strategy it is time to define the corporate that is going to
deploy it. Sky Casino is going to have an organic functional structure. It is dividing its
departments according to the functions that the business requires. First dividing these areas
from what it is going to be direct functions or support functions.
Then, this same structure can be looked at through another point of view. Depending on if
this functions are going to be made by the company or bought from other enterprises that
offer these services. In this case.
In case of Land Operations they will be buy due to the high infrastructures cost that they are
associated to this activities. HAECO, company with all the capabilities to perform this work
will be in charge not only the MRO but also the reconfiguration activities.
Airport services will be contracted with the both airport we operate SYD and HKG, they are
two of the busiest airports in the world and they are used to manage luxury companies
providing the best customer care and the most comfortable and diverse accommodation.
Casino operation are manage by our partner due to the fact that they have all the expertise
in its own team and the background of many years of operating a land casino in Sydney.
Regarding to procurement department and quality are non-core activities which are easily
externalized due to the huge number of companies which can provide a better service than
us. This is because we have currently no experience in this type of activities and therefore,
the time to obtain the expertise needed will take really long time and money for the specific
training.
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Regarding to Corporate Services, IT is also a non-core activity which an innumerable of
companies offering this service with an excellence that we cannot achieve in the short term.
Governance and Strategy will be also outsourced, using the support of the leader of consulting
companies in strategy, McKinsey & company. Taking advantage of the highest expertise and
background in this kind of work.
The strategy alternative for the entrance and evolutions it is going to be Organical Grow, pure
kind (competitive growing) by focusing in the one product that Sky Casino has, but providing
it with more planes and more travel lines.
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In this plan is described all the operations needed to make Sky Casino works. They have been
analysed in order to obtain the maximum margin optimizing all the resources and, at the same
time providing the excellence service which Sky Casino offers to the society.
Aircraft Technical Definition
Cabin Configuration
We are going to define the cabin configuration that Sky Casino has design in order to obtain
the maximum benefit providing a high quality service on board from the extra comfortable
bed-seats in the one-class cabin in the lower deck to the different game tables which will be
installed in the upper deck.
As this configuration is specifically design for Sky Casino, we need to take into consideration
several factors reflected in the different airworthiness authorities’ standards referred mostly
to on board safety such as clearance for emergency exits, oxygen mask or life vest. All this
requirement are meet and will be checked for the certification process which would be
assessed by Australian authorities.
Upper Deck
The configuration in this upper deck is based on the configuration of the A380-800 operate
by Emirates where you can find in the upper deck two the lounge bars. In this deck, it is where
the casino is established, here after a carefully analysis of marketing and interior design
department we have decided to install four baccarat tables with a capacity of 16 player each
one and six blackjack tables with a capacity of 7 player per table. These figures come up with
a maximum number of 106 players, which represents 66% of the total number of passengers
and a level of area occupancy of 47.5%, which means 90 square metres.
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Max Cabin Width 5,5 m
Cabin Length 49,9 m
Upper Area 274,45 m2
Useful area (Gambling) 189 m2
Size w/ Size w/ Player Capacity Capacity

Area (m2) Tables
players (ft) players (m) per game Playing
Baccarat Table 10x16 3,05x4,88 15 16 4 64

Blackjack 7x7 2,13x2,13 5 7 6 42
90,00 m2 106
47,5% 66,3%
A first drawing of the upper deck configuration is presented as follows:
The Baccarat table used is limited to this game which is the most demanded by our customer
market. However, the tables define as Blackjack, they are actually multigame table. They are
able to play games such as: Red Dog, Spanish 21 or Caribbean Stud. The game will be under
consensus of the players, there is no limitation due to croupier due to the fact that every
employee will be trained for the whole range of games available.
Of course, all the in flight safety requirement are meet. The certification process needed to
put into service this deck will be address in the following point.
Lower Deck
Sky Casino offer a unique experience with an extremely comfortable business class, based on
British Airways’ business class, called “Club World” with a bed-seat with the following
dimensions:
Class Pitch Width

World Club 72" 20"
The configuration for the lower or main deck is as follows:
The configuration is designed with a typical business class layout of 2-4-2. The first
compartment is formed by 36 seats, followed by another the two main compartments with
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44, 40 seats and last but not least, a 32-seat compartment. Finally, this gives a sum of 164
seats available with the maximum comfort and service excellence.
Configuration build-up
This new configuration has never done before, therefore, the leasing company will not have
any aircraft already prepared to operate it. It is under responsibility to make the different
changes and the refurnishing.
For this activity, it could be considered to be performed by HEACO, based in Hong Kong and
one potential MRO services supplier which will give us a lever in order to negotiate and
reduction in price.
Configuration Costs
An important point how much this refurnishing is going to cost to Sky Casino. The Royal
Aeronautical Society report the cost of the transitions according to the type of modification
implemented into the aircraft.
- Light modification: carpet and seat covers replacement, Airline logo, interior
placards and other airline branding.
Around $1.2m per aircraft
- Medium modification: removal of F/C and bar area, relocation of B/C seats to the
front and installation of Economy Seats and rebranding (as per light modification).
Around $5.8m plus $2.5-3m / AC on the basis of 3 AC
- Heavy modification: removal of all F/C and B/C area and installation of full
Economy Seats on the full upper deck. Including re-branding (as per light
modification)
Around $8,3 + $3.5-$5m per AC on the basis of 3 AC
Taking into account that Sky Casino in its beginning is going to own one single aircraft we
must to consider a 15% increase on the prices based on 3AC.
As the Sky Casino configuration is a Heavy modification, the costs are estimated in $15.5M.
Certification
Due to Sky Casino will be based on Sydney, Australia, it is with the Civil Aviation Safety
Authority (CASA) dependent of the Australian Government which any certification process
will take place.
Certification Process
Sky Casino configuration leads an application for Supplemental Type Certificate (STC) which
will cover all the changes which have been mainly expose on the previous paragraphs.
The definition of STC is provided in CASA website as “When a person develops the design of a
change to a type-certificated aircraft, aircraft engine or propeller, that design must be approved
before it can be used. A STC is one method of obtaining approval. If you propose to develop the
design of a major change to a type-certificated aircraft, aircraft engine or propeller you should seek
an STC, especially if you wish to sell your design to multiple customers.”
The process is also shown in the web page of the authority and these are the main steps:
Step 1. Complete and send Step 4. Estimate of costs

application form Step 5. Assessment
Step 2. Submit application form Step 6. Recommendation
Step 3. Review of your application Step 7. Certificate Issue
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Certification Costs
CASA provide the regular hourly rates use for different services that they provided:
“Generally, a general aviation matter is likely to be charged at $160 per hour and a service
provided by an air transport operations inspector at $190 per hour.”
Considering this process of certification can last in the time during 1 month as a C-Check
maintenance revision and in a two-shift and 8 hours per shift daily work. The cost would be
approximately 61.000$. Apart from the spending allocated in internal workload in order to
draft and create the documentation required included in the contract with the reconfiguration
supplier.
This paragraph is really important for Sky Casino, here we are going to define the ownership
strategy of the mean asset of the company, the aircraft A380.
In the market, we find three different options in order to deal with the acquisition of an
aircraft. One option could be a purchase operation or another one could be a leasing. Inside
leasing, we differentiate between operational leasing (renting) and financial leasing (leasing).
From this point, an analysis of the three options takes place.
Purchasing
This is the regular transaction that an airline perform because the aircraft is, as we said before,
the most important asset, linking our customers with the company. The purchasing operations
have some benefits but also really important risks which should be taken into account.
So, in the case of buying an A380, Sky Casino would obtain the fully control over it and all the
privileges associated but the price is so high that makes completely unaffordable the
purchasing operation for a brand new company.
This last sentence lead us to discard the purchasing option.
Operational Leasing
This is commonly known as a renting operation. In this case, the operational plan of the
aircraft becomes really simple because the rental company usually offers full operation
packages from the aircraft itself to the MRO through the crew.
Notwithstanding, the last paragraph exists an important counterpoint for this option. The
control over the asset is really low. For Sky Casino, this strategy point is key due to the fact
that we will change the cabin configuration of the aircraft to adapt it to the one-class lower
deck and the casino upper deck.
Therefore, this option is also discarded.
Financial Leasing
The last but no least option, the financial leasing, it is an intermediate option between the
purchase and the renting. This option give to Sky Casino the opportunity to have fully control
over the asset and avoid the payment of the whole price at once.
The below table contains estimate current market value. The information is derived from
actual transactions along with market valuations and is current as of August 2016. Data
source: IBA/Ascend
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AC Model min max
Value Value
[$M] [$M]
A320 1,9 43,1
A330-200 23,9 85,3
A330-300 14,5 100,8
A380-800 350,5 500,1
B737-800 14,6 45,6
B737-900ER 26 46,9
B747-8i 110,9 150
B777-300ER 56,2 154,7
B787-9 115,6 145,7
In the following table, meanwhile, it is shown the financial leasing conditions according to the
aircraft category:
From these two table we can deduce the following: as far as a380 is categorized in Turboprop
& Turbine aircraft, Sky Casino would have to start with a down payment of 15% (M$ 22.5) of
the total price of the aircraft with periodic payments based on 4.5% of interest rate.
The period of time during the lease takes place never would be longer than 20 years. Sky
Casino consider a conservative position with 15 years.
Taking into account what has been stated above, the years, when new aircraft are putting in
service, will definitely be the years with highest fixed cost due to corresponding down
payments.
As part of the general operation plan, we have to take a deep look in the operations of the
casino, since it is one of the most important parts of our business.
In this section, we will analyse the costs involved in the operation of the casino, as well as
some of the points to take into account when referring to this topic.
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Management of casino operations
As explained in previous chapters of this documents, we have developed a business plan for
which we already have a main investor, the star Sydney casino.
This main investor of the company “Sky casino” will therefore be the main shareholders (as
defined in the financial plan). They will bring the know-how for the casino operations to help
the operations manager to develop a suitable strategy.
In order to make a complete business plan, we will develop a 5 years operations plan for the
casino, subject to modifications under the best judgment of the operations manager.
Cash management
It is preferable for the company to avoid cash operations in order to keep the most
transparent business. However, it will be possible to acquire chips for the casino in the
following ways:
- Buying chips along with the ticket. The chips will be provided starting the flight.
- Paying with bank transference in the aircraft. Chips will be provided at the moment
of the transaction.
- Paying in cash in the aircraft. Chips will be provided at the moment of the payment.
In the casino will only be possible to play with the casino chips, not with cash or valuables.
At any moment, any customer can reclaim the value of their chips. The chips will be returned
to the casino and a transfer will be made to the customer bank account.
While this description stands for the upper deck casino, for the digital gambling system
allocated in the passenger seats will directly function with the passenger bank account
without the need of using casino chips.
Human resources for the casino operations

This topic will be further explained in the Human resources plan, but for the purpose of this
chapter we will explain the general structure for the human resources of the casino
The total amount staff involved in the casino operations varies during the 5 years plan, starting
from 40 people the first year, 60 the second year to the fourth, 80 the last year (not counting
the operations manager, whose work is necessary for the long term and is accounted in the
HHRR plan, but for not needed for the operations).
There is no differentiation between the flight assistants and the croupiers, since they will all
receive the same formation. This formation will consist on a croupier course given to certified
flight assistants, which we will explain more in depth in the HHRR plan, and the cost will be
allocated there since it is not a cost to incur in every operation.
In each flight, the crew will consist of four technical crew, two captains and two flight
engineers there will be twenty people as flight assistants, ten acting as croupiers in the gaming
tables and the rest as flight attendants in a rotational planning along the flight, taking into
account breaks for rest. Also, between flight assistants will be appointed a team leader or
ward leader each five employee. The roles will be decided according to the aptitudes of the
individuals, but can and probably will be changed if considered appropriate.
The cost is distribute as follows: in average each tech crew costs 200.000$ and 95.000$ per
flight assistant, 100.000$ per team leader, adding up to 5.440.000$ the first year. Following
years, by law a simple interest of 1% is applied. Therefore, the number are as follows:
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8.241.600$ the second, 8.324.600$ the third, the fourth year is 11.209.675$, and
11.321.772$ the fifth year.
To that, we have to add the cost of hotel night of this crew. Taking the price of a standard
individual airport hotel in HK and Sidney, the number of flights, and the fact that half the crew
will stay in their homes (since they will be from HK or Sydney), the cost adds up to
130$/person night * 10 people * number of flights, 370.000$ the first year, 618.800$ the
second year, 738.400$ from the third to the fifth years.
Digital gambling system

In the lower deck, seats will have incorporated a digital gambling system.
Passengers will be able to engage in gaming activities from their seats without the need of
acquiring casino chips.
At the moment of buying plane tickets, the seat will be associated with the individual bank
account so they will be able to play without introducing any data.
The games allowed will be the usual from online casinos and betting houses.
Casino general costs

Other costs regarding the casino business besides human resources, are the following
 Installation of casino facilities (the costs have been approximated using a factor of 10
to consider airworthiness):
o Blackjack table: 7.500$/table 75.000$
o Baccarat table: 9.000$/table 90.000$
o Security cameras: 10.000$
 Development of digital gambling system  70.000S
o Maintenance of the digital gambling system 15.000$
 Maintenance (approximated by a 10% of the cost)
o Gambling tables  16.500$/year
o Cameras  1.000$/year
Casino 5 years operation plan

Here we find the evolution of expenses for casino operations during the 5 years we are
studying. The biggest amount by far are the human resources related costs, salaries and hotel.
Operation costs without HHRR

Installation of casino facilities
7000000
6000000
5000000
4000000
3000000
2000000
1000000
0
Year 1 Year 2 Year 3 Year 4 Year 5
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Operation costs without HHRR
Installation of casino facilities
300000
Maintenance
250000
Digital gambling system
200000
150000
100000
50000
0
For any airline, the maintenance, repair & overhaul are key activities which all tougher can be
organised in a MRO Plan. This activities they are not optional, airworthiness authorities have
high standard and regulation depending on the use or the time from the fist operation and
the cost cannot be considered as negligible. Actually, the situation is in the order way around,
the maintenance costs has such an importance inside the airline that we need to be analysed
apart from the regular operation.
This MRO plan firstly consists of a definition of which type of maintenance should be taken
into account and a present a standard MRO programme. Then, the presentation of an analysis
with data from different sources, allowing to analyse different scenarios and confirm an
estimation in terms of order of magnitude of the maintenance costs. To close this point, they
will be presented the decisions taken in order to implement an MRO strategy in order to deal
with early risks, investments and future development.
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Definition and Enablement
MRO for any kind of aircraft is formed by different levels and categories, those categories are
- Line Maintenance
- Airframe Maintenance
- Engine Maintenance
- Component Maintenance
- Modifications
In the figure above, we can see the necessity of develop an Operator Maintenance
Programme which must compliance with the airworthiness requirement stablish by the low
of the country, although JAR 145 or EASA 145 taken every low country under its scope. Those
programme will be different for each aircraft model and usually are rules by Flight Hours or
every fix period of time.
For the definition and quotation we will consider the airbus design of a standard maintenance
plan for a380 MRO.
Check Limit Duration Considerations

A-Check 750/1000 FH 20 hours Mainten. Hangar
C-Check 18/24 months 25 days Mainten. Hangar
3C-Check 120/144 months 50 days Mainten. Hangar
MRO Standard Quotation
Cost Quotation
Once a standard maintenance programme has been defined, Sky Casino is able to begin to
perform cost estimations using the following three criteria>
 Criteria 1. Standard plan + % (airframe & engine spare forecast):

1.45 k$/FH
 Criteria 2. ICF International. MRO Forecast and Market Trends:

1.50 k$/FH
 Criteria 3. IATA Statistics for Wide Body:

1.65 k$/FH in 2013
1.68 k$/FH in 2011
Taking into account the three criteria, we can conclude with certain level of confidence an
estimated cost of 1.500 USD/FH.
Fleet Availability
The importance of this point comes from its used for marketing plan and the operational,
this gives us the percentage of hour’s availability in ten years taking into account the MRO
inspections. Using the standard programme defined in the previous point the fleet
availability, our fleet availability is represented in the following table:
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Periods Hours MRO H Availability
Year 1 4320 60 99%
Year 2 8640 120 99%
Year 3 8640 676 92%
Year 4 8640 120 99%
Year 5 8640 676 92%
Accumulated
38880 1652 96%
in 5 years
Those number reflects the availability of our aircraft and it is a way of define the productivity
of our main asset, A380. For the our case, we keep and high availability during all years (over
90%). Years when C-Check (almost 1 month stops) is required this is number falls to the 92%
although still high.
MRO Strategies
In this section Sky Casino is going to test the different options to implement MRO strategy.
First of all, it is presented the common strategies which are currently used by the carriers
around the world. For instance:
- In house. The carrier is the owner of all the operations and facilities needed to
perform MRO activities.
- Third Party. MRO services are performed by other carrier.
- OEM. The carrier signed with the manufacturer the activities
- Independent MRO. An MRO company which has no dependency from other carrier.
- Joint Venture. This kind of company comes from the union of an OEM and an
independent MRO.
Those strategies can be summed up as: IN HOUSE or OUTSOURCING (all options but the
first one).
In-House
As it was said before, an In-house policy for MRO, it would lead a high risk for the operations
due to the enormous investment. It is not just the know-how and the manpower to plan and
play the following the MRO activities but we would need to surpass some barriers such as:
- Facilities. - Ground Support Equipment.

- Documentation & Quality - HHRR management for MRO.
management.
Outsourcing
Sky Casino is operating an a380 which is the biggest commercial aircraft ever manufactured.
For that reason, the number of MRO services company are not very numerous, in the
following list, it is shown the MRO companies which are inside an Airbus MRO network and
are currently performing A380 MRO services to current operators.
- Abu Dhabi Aircraft Technologies - Iberia Maintenance

- Aeroman - Lufthansa Technik AG
- Air France Industries - Mexicana MRO Services
- Air New Zealand Engineering - Sabena Technics
Services - SIA Engineering Company
- Aveos - Singapore Technologies
- GAMECO Aerospace
- Hong Kong Aircraft Engineering - SR Technics Switzerland
Company - TAM MRO
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- TAP Maintenance & Engineering - Turkish Technic
- TIMCO Aviation Services
Conclusions & Decisions
In order to create a footprint in the Hong Kong society, it would be a great opportunity to
sign the MRO services for our company with Hong Kong Aircraft Engineering Company
(HAECO).
HAECO is part of the Airbus MRO network since 2006. This is really a strategic decision for
us due to the fact that Hong Kong is one of our bases and due to the importance for airliners
of have a robust MRO supplier.
Nevertheless, the MRO supplier should be decided after an analysis of a bidding process.
Casino Sky ensures the availability and quick response of the main bases where it operates.
One key point is to keep a time saving policy, even before and after the flight. For that
purpose, Casino Sky operates under contracts with airports, aligned to the strategic vision of
the company. Moreover, operating from these airports gives the company advantages,
where time-saving gains importance, cutting check-in queues, and taking into account the
time spent to reach the city centre. Not all airports operate with A380, only the following
ones, where Hong Kong and Sydney airports are included.
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Hong Kong Airport
Hong Kong International Airport (IATA: HKG, ICAO: VHHH) is the main airport in Hong Kong.
It is located on the island of Chek Lap Kok, which largely comprises land reclaimed for the
construction of the airport itself. The airport is also colloquially known as Chek Lap Kok
Airport (赤鱲角機場), to distinguish it from its predecessor, the closed Kai Tak Airport.
The airport has been in commercial operation since 1998, replacing the Kai Tak Airport. It is
an important regional trans-shipment centre, passenger hub and gateway for destinations in
Mainland China (with 45 destinations) and the rest of Asia. The airport is the world's busiest
cargo gateway and one of the world's busiest passenger airports. It is also home to one of the
world's largest passenger terminal buildings (the largest when opened in 1998).
The airport is operated by the Airport Authority Hong Kong 24 hours a day and is the primary
hub for Cathay Pacific (the flag carrier of Hong Kong), Cathay Dragon, Hong Kong Airlines,
Hong Kong Express Airways and Air Hong Kong (cargo carrier). The airport is one of the hubs
of Oneworld alliance, and it is also one of the Asia-Pacific cargo hubs for UPS Airlines. It is a
focus city for many airlines, including China Airlines and China Eastern Airlines. Singapore
Airlines, Ethiopian Airlines and Air India utilize Hong Kong as a stopover point for their flights.
Hong Kong International Airport covers an area of 1,255 hectares (4.85 sq mi). The airport
has a total of 90 boarding gates, with 78 jet bridge gates and 12 virtual gates which are used
as assembly points for passengers, who are then ferried to the aircraft by apron buses. Of the
66 jet bridges, five are capable of handling the Airbus A380, the current users of which are
Singapore Airlines, Emirates, Qantas, British Airways, Asiana Airlines, Thai Airways, Air
France, Lufthansa and our Casino Sky.
Passenger facilities
Despite its size, the passenger terminal was designed for convenience. The layout and
signage, moving walkways and the automated people mover help passengers move through
the building. The HKIA Automated People Mover, a driverless people mover system with 3
stations transports passengers between the check-in area and the gates. The trains travel at
62 kilometres per hour (39 mph). The airport also boasts an IMAX theatre that has the largest
screen in Hong Kong. The theatre is located in Terminal 2, level 6 and can seat 350 persons
at a time.
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Hong Kong Business Aviation Centre
The Hong Kong Business Aviation Centre (BAC) is located within the airport and has its own
terminal and facilities separate from the public terminal. It provides services for executive
aircraft and passengers, including a passenger lounge, private rooms and showers, business
centre facilities, ground handling, baggage handling, fuelling, security, customs and flight
planning. Designated spaces and hangars are also provided at the BAC for private aircraft.
Intermodal Transportation Hub

To sustain the growth of passengers, the Airport Authority formulated a "push and pull
through" strategy to expand its connections to new sources of passengers and cargo. This
means adapting the network to the rapidly growing markets in China.
Aircraft maintenance services

Both line and base maintenance services are undertaken by Hong Kong Aircraft Engineering
Company (HAECO), while China Aircraft Services Limited (CASL) and Pan Asia Pacific Aviation
Services Limited carry out line maintenance. Line maintenance services include routine
servicing of aircraft performed during normal turnaround periods and regularly scheduled
layover periods. Base maintenance covers all airframe maintenance services and for this
HAECO has a three-bay hangar, which can accommodate up to three Boeing 747-400 aircraft
and two Airbus A320 aircraft, and an adjoining support workshop. HAECO also has the
world's largest mobile hangar, weighing over 400 tons. It can be used to enclose half of a
wide-body aeroplane so that the whole facility can fully enclose four 747s when the mobile
hangar is used.
Ground transports
Bus. Citybus, New Lantao Bus, Long Win Bus and Discovery Bay Transit Services operate 25
bus routes to the airport from various parts of Hong Kong, available at the Airport Ground
Transportation Centre and Cheong Tat Road.
Rail. The fastest service from the city to the airport is the Airport Express, a dedicated high-
speed rail link as part of the MTR rapid transit network. It takes 24 minutes to reach the
airport from Hong Kong station.
Ferry. Direct ferry services are available from the airport to various destinations throughout
the Pearl River Delta via Skypier. Passengers using these services are treated as transit
passengers and are not considered to have entered Hong Kong for immigration purposes. For
this reason, access to the ferry terminal is before immigration in the airport for arriving
passengers.
Taxi
Charges
All Departing Passengers (Origin-Destination and Transit/Transfer)

Per departing passenger ($) First / Business class Economy class
Long-haul $23,18 $20,61
Short-haul $20,61 $11,59
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Sydney Airport
Sydney (Kingsford Smith) Airportis an international airport in Sydney, Australia located 8 km

(5 mi) south of Sydney city centre, in the suburb of Mascot. It is the primary airport serving
Sydney, and is a primary hub for Qantas, as well as a secondary hub for Virgin Australia and
Jetstar Airways. Situated next to Botany Bay, the airport has three runways, colloquially
known as the east–west, north–south and third runways.
Sydney Airport is both the longest continuously operated commercial airport and oldest
commercial international airport in the world, the world's oldest continually operating
commercial airport,[8] and the busiest airport in Australia, handling 35,630,549 passengers in
2011[9] and 326,686 aircraft movements in 2013.[10] It was the 38th busiest airport in the
world in 2015. The airport is managed by Sydney Airport Corporation Limited (SACL) and the
current CEO and MD is Kerrie Mather. Currently 46 domestic and 43 international
destinations are served to Sydney directly.
Investing for the A380

To secure the benefits of the A380 for Sydney, $120 million has been invested in new and
upgraded infrastructure. Key upgrades included:
• Strengthening the airport tunnel over General Holmes Drive

• Widening pavement shoulders, fillets and flanks to the main north-south and east-
west runways
• Relocating Taxiway G east of Taxiway D to accommodate the clearances necessary
for the A380s wingspan
• Relocating airfield navigational and visual aid equipment including taxiway lighting
and signage
• Providing three-door aerobridges at the International Terminal at contact bays 9, 10,
24, 57 and 61
The Australian Government’s Air Services Australia has released a report on the noise
performance of the A380. This report found that the A380 is between 2.3 and 6.7 decibels
quieter than the 747-400 when departing Sydney Airport. The report states that a ‘three
decibel reduction is regarded as a halving of an aircraft’s noise energy.”
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Ground transports
Bus. Sydney Buses operate route 400 from Burwood to Bondi Junction railway stations which
stops at both the International and Domestic terminals. This route connects to the eastern
suburbs, and St George areas.
Vehicles / Taxi. Sydney Airport has road connections in all directions. Southern Cross Drive
(M1), a motorway, is the fastest link with the city centre. The M5 South Western Motorway
(including the M5 East Freeway) links the airport with the south-western suburbs of Sydney.
A ring road runs around the airport consisting of Airport Drive, Qantas Drive, General Holmes
Drive, M5 East Freeway and Marsh Street. General Holmes Drive features a tunnel under the
main north-south runway and three taxiways as well as providing access to an aircraft viewing
area.
Rail. The airport is accessible via the Airport Link underground rail line. The International
railway station is located below the International terminal, while the domestic railway station
is located under the car park between the domestic terminals (Terminal 2 and Terminal 3).
While the stations are part of the Sydney Trains suburban network, they are privately owned
and operated by the Airport Link consortium and their use is subject to a surcharge.
Charges
Passenger Charge
Embarking $29,89 Disembarking $32,88
Parking Charge
between 6am and 11pm
$38,50 per $55,00 per 15
first 180 min 15min beyond 180 min min
Check-in procedure
Follow step-by-step guide below to ensure a smooth and hassle-free check-in. Most airline
check-in counters open at least 2 hours before your flight, and some also offer early and
online check-in, as Sky Casino. We encourage you to check-in at least 2 hours before your
departure time. Ensure that your check-in goes smoothly:
1. Pack all your luggage, including your Hand-Carried Luggage, according to security
guidelines.
2. When you arrive at the airport, refer to the Flight Information Display Screens for
your airline's check-in row information.
3. Approach the check-in counter with your travel documents (valid passport, air ticket
or booking confirmation, and visa if applicable).
4. Check that you are issued with the correct boarding passes and that your travel
documents are in order before leaving the check-in counter.
5. Enter the Departure Hall and enjoy great transit facilities like dining and shopping!
Sky Casino check-in & baggage drop special services

 Online check-in
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You may be able to check-in online up to 48 hours before your flight. You can do so by
phone, fax, SMS, email, WAP or online.
 FAST check-in
With Fast and Seamless Travel at Casino Sky, enjoy shorter queues and greater flexibility.
 Early check-in
Check-in counters open at least 2 hours before flight departure, but some airlines let you
check in early. All the better to enjoy our facilities and services!
 Group check-in
Travelling in a group of 10 or more? Your airline may have a special check-in counter at
their designated check-in rows.
 Check-in counter
Check-in counters open at least 2 hours before departure time. Ready your valid travel
documents - passport, air ticket or booking confirmation and visa (if applicable).
Security
You are required to undergo security screening and have your hand-carried luggage x-rayed.
Follow the steps below for a hassle-free experience:
1. Prepare your passport and boarding pass for inspection at the gate.
2. Place your liquids, aerosols and gels in the tray.
3. Place your electronic (e.g. laptops, mobile phones, tablets) and metallic items (e.g.keys,
coins) in a separate tray.
4. Remove your outer wear (e.g. jacket, sweater, coat), hat and high-cut footwear.
5. Place your hand-carried luggage onto the conveyor belt.
6. Proceed through the walkthrough metal detectors. Please note that you may be
subject to an enhanced security screening process, if required.
Yearly Plan
In this point, we are going to present the operation within the route Kingsford Smith
International Airport (SYD) and Hong Kong International Airport (HKG). We are going to
present a yearly calendar where we reflect number of flights and its corresponding
accumulated Flight Hours (FH). Also, we identify the period where MRO takes places.
In the following tables, firstly, it is shown a summary of the first 5 years of business and then
a breakdown of the different years by month periods.
Flights FH MRO H
Year 1 174 1566:00 60
Year 2 348 3132:00 120
Year 3 510 4590:00 676
Year 4 618 5562:00 120
Year 5 660 5940:00 676
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YEAR 1
SYD - HKN HKN - SYD TOTAL
Flights FH Flight FH Flights FH MRO
Month 1
Certification Process
Month 6
Month 7 15 135:00 15 135:00 30 270:00
Month 8 14 126:00 14 126:00 28 252:00 CHECK A
Month 9 15 135:00 15 135:00 30 270:00
Month 10 14 126:00 14 126:00 28 252:00 CHECK A
Month 11 15 135:00 15 135:00 30 270:00
Month 12 14 126:00 14 126:00 28 252:00 CHECK A
YEAR 2
Month 1 15 135:00 15 135:00 30 270:00
Month 2 14 126:00 14 126:00 28 252:00 CHECK A
Month 3 15 135:00 15 135:00 30 270:00
Month 4 14 126:00 14 126:00 28 252:00 CHECK A
Month 5 15 135:00 15 135:00 30 270:00
Month 6 14 126:00 14 126:00 28 252:00 CHECK A
Month 7 15 135:00 15 135:00 30 270:00
Month 8 14 126:00 14 126:00 28 252:00 CHECK A
Month 9 15 135:00 15 135:00 30 270:00
Month 10 14 126:00 14 126:00 28 252:00 CHECK A
Month 11 15 135:00 15 135:00 30 270:00
Month 12 14 126:00 14 126:00 28 252:00 CHECK A
YEAR 3
Month 1 15 135:00 15 135:00 30 270:00
Month 2 14 126:00 14 126:00 28 252:00 CHECK A
Month 3 15 135:00 15 135:00 30 270:00
Month 4 14 126:00 14 126:00 28 252:00 CHECK A
Month 5 15 135:00 15 135:00 30 270:00
Month 6 5 45:00 5 45:00 10 90:00 CHECK C
Month 7 30 270:00 30 270:00 60 540:00
Month 8 29 261:00 29 261:00 58 522:00 CHECK A
Month 9 30 270:00 30 270:00 60 540:00
Month 10 29 261:00 29 261:00 58 522:00 CHECK A
Month 11 30 270:00 30 270:00 60 540:00
Month 12 29 261:00 29 261:00 58 522:00 CHECK A
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YEAR 4
Month 1 15 135:00 15 135:00 30 270:00
Month 2 14 126:00 14 126:00 28 252:00 CHECK A
Month 3 15 135:00 15 135:00 30 270:00
Month 4 29 261:00 29 261:00 58 522:00 CHECK A
Month 5 30 270:00 30 270:00 60 540:00
Month 6 29 261:00 29 261:00 58 522:00 CHECK A
Month 7 30 270:00 30 270:00 60 540:00
Month 8 29 261:00 29 261:00 58 522:00 CHECK A
Month 9 30 270:00 30 270:00 60 540:00
Month 10 29 261:00 29 261:00 58 522:00 CHECK A
Month 11 30 270:00 30 270:00 60 540:00
Month 12 29 261:00 29 261:00 58 522:00 CHECK A
YEAR 5
Month 1 30 270:00 30 270:00 60 540:00
Month 2 29 261:00 29 261:00 58 522:00 CHECK A
Month 3 30 270:00 30 270:00 60 540:00
Month 4 29 261:00 29 261:00 58 522:00 CHECK A
Month 5 30 270:00 30 270:00 60 540:00
Month 6 5 45:00 5 45:00 10 90:00 CHECK C
Month 7 30 270:00 30 270:00 60 540:00
Month 8 29 261:00 29 261:00 58 522:00 CHECK A
Month 9 30 270:00 30 270:00 60 540:00
Month 10 29 261:00 29 261:00 58 522:00 CHECK A
Month 11 30 270:00 30 270:00 60 540:00
Month 12 29 261:00 29 261:00 58 522:00 CHECK A
Schedules
The schedule on we are going to operate has been selected in cooperation with the marketing
organization in order to assure the customer satisfaction and obtain the maximum customer
share.
Due to the geographical situation of the Australian continent, in Sydney, it is differentiated

two seasons in term of time. It means on April 2nd the winter schedule begins until October
2nd when the summer schedule takes place.
On the other hand, Hong Kong has not this differentiation, they are always within the same
time zone.
Taking this into account, the schedules of our flights will be different in summer season and
winter season, as you can see in the following tables:
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Summer time.
Departure Arrival Time

FH
Time Time Difference
SYD HKG
2:00 9:00
10:00 17:00
HKG SYD
2:00 9:00
10:00+1 21:00+1
Winter time.

FH
SYD HKG
3:00 9:00
10:00 16:00
HKG SYD
3:00 9:00
10:00+1 22:00+1
Those schedule are for the months when we operate our aircraft once a day but as you could
see in the yearly plan after the first year, we start to operate twice a year in some months
until the fifth year when then the entire year is based on a twice-flight per day. Then, the
schedule is as follows:
Summer time
Departure Arrival Time FH

SYD HKG 2:00 9:00
10:00 17:00
HKG SYD 2:00 9:00
20:00 7:00+1
Winter time.

FH
SYD HKG
3:00 9:00
10:00 16:00
HKG SYD
3:00 9:00
19:00 7:00+1
Turnaround time.
Turnaround time in aviation maintenance is defined as “the process of or time needed for
loading, unloading, and servicing an aircraft“. As it was shown in the last part, Sky Casino is
going to start operating twice a day from the second year of operation. In order to achieve
and provide this commitment with the customer an analysis of the turnaround time needed
for A380 was performed. As a based we use the A380 Airport Operations magazine where
estimate 90 minutes Turn Araound Time for a 3 class configuration. Taking into account the
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special facilities and requirements for Sky Casino we consider a Time Around Time of 116
minutes with the following critical path.
The safe and continuous supply of on-time and economically delivered jet fuel is a critical
component of airport operations. Any disruption to the fuel supply chain can have significant
flow-on effects to all aircraft movements and passengers.
Refueling operations can be hazardous and, therefore, require the constant attention of all
personnel involved. Fortunately, in commercial aviation, accidents associated with refueling
operations rarely occur. However, the absence of accidents should not result in complacency,
because refueling incidents, such as fuel spillage, frequently occur. Teamwork is essential to
accident prevention, particularly during aircraft refueling operations. This Flight Operations
Briefing Note is designed to provide all personnel, involved in refueling operations, with an
overview of the applicable recommendations.
Sydney airport
Existing Facilities
Jet fuel is supplied to Sydney Airport by two underground pipelines owned by Shell and Caltex
from their respective refineries. BP and ExxonMobil supply fuel from their bulk storage
terminal using the Caltex pipeline. Jet fuel supplied from these underground pipelines is
stored at the Joint User Hydrant Installation (JUHI) located at the northern end of the
International Precinct. The JUHI is an unincorporated joint venture currently comprising BP,
Caltex, ExxonMobil, Shell and Qantas. Shell operates and manages developments for the
facility on behalf of the participants.
Casino Sky ensures refueling operations signing an agreement with Shell Development
(Australia) Pty Ltd., operated by JUHI. Shell will be working to strengthen the partnership with
all the Sydeney airport users, to ensure safe and efficient refueling operations in support of
Sydney Airport’s growth. The agreement is set for the following 5 years with a supposed fixed
growth rate for the first two years.
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Current capacity
The current Shell and Caltex supply pipelines are assumed to be capable of delivering a
combined capacity of 8.8 million litres per day. The current storage capacity at the JUHI
facility is 28.2 million litres contained in five bulk tanks. In practice, the operational reserves
will be less than this total capacity as not all tanks can be ‘on line’ at any given time. This
limitation is the result of fuel quality control procedures and required separation of fuel
receive and supply actions. The arrangements provide for two to three days reserve capacity
at current consumption rates
Hong Kong Airport

Existing Facilities
To ensure reliable and sufficient supply of fuel for about 1,000 flights that take off and land
at the airport every day, Hong Kong International Airport (HKIA) possesses an efficient
aviation fuel supply system which consists of two key elements – the On-airport Aviation Fuel
System and the Permanent Aviation Fuel Facility (PAFF).
The On-airport Aviation System includes 12 storage tanks with an aggregate capacity of
220,000m3, an aviation fuel receiving facility at Sha Chau, and a hydrant distribution system
on apron. Management and operation of the On-airport Aviation Fuel System is franchised to
AFSC Operations Limited by the Airport Authority.
Casino Sky ensures refueling operations signing an agreement with Shell Developments (HK)
Ltd., operated by AFSC. Shell will be working to strengthen the partnership with all the Hong
kong airport users, to ensure safe and efficient refueling operations in support of Hong Kong
Airport’s growth. The agreement is set for the following 5 years with a supposed fixed growth
rate for the first two years.
Current Capacity
Located off the airport at Tuen Mun, PAFF includes (i) a dual-berth jetty capable of
accommodating ocean-going tankers from 10,000 to 80,000 dwt, (ii) 8 storage tanks with an
aggregate capacity of 264,000m3 and (iii) twin submarine pipelines connecting PAFF with the
airport via Sha Chau. Operation of PAFF is franchised to ECO Aviation Fuel Services Limited
by the Airport Authority.
The price for the first year is set for both suppliers as a cost per flight for the route of
Singapore-Kuala Lumpur.
Jet Fuel Price

The price for the first year is set for both suppliers as a cost per flight for the route of Sydney
– Hong Kong.
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1.54 $/gallon
Safety requirements
Refueling with Kerosene (JET A, JET A1 JP8, TS1, RT, TH or equivalent, as approved by the
approved Aircraft Flight Manual), is allowed when passengers are boarding, on board, or
disembarking. When passengers are on board the aircraft, precautions must be taken to
ensure that they can be evacuated, in the rare case that a fire may occur. If fuel vapor is
detected inside the aircraft, or if any other hazard occurs, refueling or defueling will be
stopped immediately.
Casino Sky flight crew ensures:
- Inform the cabin crew of the beginning and ending of refueling

- Be prepared to initiate passenger evacuation if necessary
Casino Sky cabin crew ensures:
- Establish communication with the flight crew

- Inform passengers not to smoke
- Inform passengers to unfasten their seat belts
- Remain clear emergency exits of obstruction
- Communication with handling servicing (catering or cleaning) so they cannot create a
hazard, or delay an emergency evacuation
Casino Sky operations are empowered due to the union with the handling partners. Our
company has reached a special agreement with the main services provider in both airports.
Dnata airport services, in Sydney Airport and Hong Kong Aviation Ground Service Ltd.
(HAGSL), in Hong Kong. The negotiation for the services has given a settlement with lower
prices: providing us with the following services:
Ramp services
- Baggage Handling - Safety
- Marshaling - Moving Aircraft
- Parking - Toilet Services
- Cooling/Heating - Water Services
- Ramp to Flight-deck - Cabin Equipment
Communications - Cabin Material Storage
- Loading/Unloading - Catering Ramp Services
- Air Start - Ice/Snow removal
Passenger services
- Check in services - Lost and found facilities
- Airport lounges - Administration and supervision
- Gate activities services
- Airport ticketing - Station management services
- CIP lounges, meet and greet VIP including transfers and disruptions
handling services - Passenger with reduced mobility
- Arrival services assistance
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- Airside bussing for passenger and
crew
Meet and greet

- Meet and greet on arrival and fast- - Delivery of arrival bags
track through transfer formalities - Departure and arrival support
to the transfer desk - City stops
- Baggage identification and - Visa service
onwards
Airport Lounges
- 24-hour television broadcasting - Business services
and reading materials - International cuisine with hot and
- Shower and smoking facilities in cold beverages
selected lounges
Load Control and Operations
- Load Control - Aircraft interior and exterior
- Communications cleaning
The level of detail in these services is very high, performing the best custom attention to
clients, ensuring safety and a quick response to prepare the aircraft for the next flight.
The contract accorded set a yearly cost of $1.000.000 fixed plus $90 per passenger.
Variable Costs
In order to track performance through the year it is key to calculate the variable operational
costs which include fuel, MRO activities, Airport fees (de-boarding/boarding, communication
and parking, for instance) and Handling where all the costs from services are allocated.
We are going to distinguish between two different scenarios. Although both has same number
of flight along a 5-year period. The percentage of occupancy change and that has a direct
influence on variable costs.
Scenario I
In this scenario, marketing organization has considered the following figures in terms of
occupancy:
$80.000.000
$70.000.000
$60.000.000
$50.000.000 Handling
$40.000.000 Airport Fee

MRO
$30.000.000
Fuel
$20.000.000
$10.000.000
$0
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Scenario II
For this scenario the numbers of occupancy are different as are shown in the following
table:And variable costs are:
$80.000.000
$70.000.000
$60.000.000
$50.000.000 Handling
$40.000.000 Airport Fee

MRO
$30.000.000
Fuel
$20.000.000
$10.000.000
$0
Conclusion
It is clear seen that the cost structure does not change as consequence of its direct
dependency with the number of flight which is consider invariable between scenarios. What
it is actually noticeable is the increment of cost due to the increment on occupancy rate.
As it was expected the fuel is the mean costs that we have to assume in order to operate the
aircraft following by the airport fees which can be split them up in fix (communication and
navigation) and variable according the number of passenger (pax boarding/de-boarding).
Then, we find the handling and last but not least the MRO activities.
The increment per year of the fuel compensation as major cost will drive a negotiation with
the supplier in order to have some reduction of price as well as the handling supplier once a
limit of passenger is overpassed.
Operational Cost Structure

Year 1 Fuel
MRO
14% Airport Fees

3%
3%
Handling
2%
3% Crew
3%
60% Casino
12% Operation
Reconfiguration
& Certification
Leasing
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As it is presented, the cost structure at the first year is totally unbalanced due to the down
payment of 20% of the total price which is done to the leaser and the lack of operation during
certification process. Another important point is the reconfiguration and certification costs
which only apply this year and made the sum to increase notably.
Year 2 Fuel
MRO
Airport Fees
31%
38% Handling
Crew
1% 6% Casino
7% 8% Operation
9% Leasing
For the second year, operational cost structure completely change. Still leasing point is an
important part of it but it is release to the second position, for this year and followings this
costs are limited to the monthly payment and their interests. In this year, fuel obtain the first
position and, of course, certification and reconfiguration costs are eliminated.
Between those the second year in the two scenarios no significant difference has been
observed in the structure of the costs, therefore only one has been presented.
Sky Casino assumes a risky scenarios, where a contingency plan is needed in order to keep
the level of service and give the clients the best customer service. The cost of these
contingencies is a percentage of the total cost, preventing a higher amount in percentage for
the first year. There are some undesirable scenarios described below, but also events that
may suppose opportunities for the business.
Delays.
In the event that a flight is delayed more than 30 minutes, Sky Casino will provide for the
customer an extension of the services provided in a normal operation condition. For that
possibility, the airline ensures that operable facilities available while the aircraft is delayed,
besides notify guests on board the aircraft affected of the status of the delay every 10 minutes
during the delay, beginning 15 minutes from scheduled departure time. This plan has been
coordinated with airport authorities at each airport.
Sky Casino also provides adequate assistance and care to guests with disabilities and other
guest with special needs.
Any passenger who choose to deplane from a flight that has experienced a delay and make
alternative travel arrangements, may do so when it is determined to be safe and secure, after
the aircraft has been moved into position for deplaning, all operational requirements for
deplaning have been completed, and the pilot has allowed customer deplaning to begin.
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Passenger should be aware that if they choose to deplane, they do so at their own risk and
the flight may depart without them. Sky Casino will make reasonable attempts, to
communicate the new departure time of the flight.
In the case of arrival delays, Sky Casino is giving a compensation depending on the time:
 From 0 to 20 minutes arrival delay: No compensation.

 From 20 minutes to 2 hours: 60 % of a typical one-way fare for the route.
 Over 2 hours: 120% of a typical one-way fare for the route.
There are exceptions for delays and cancellations of flights, what are considered extraordinary
circumstances. Those special cases comprehend:
 Political instability
 Unfavourable weather conditions to perform the flight
 Safety risks or deficiencies
 Strike affecting operations
 Air traffic decisions about a certain aircraft or date, which origins a great delay or
cancellation.
Long repairing
In the case of an extended repairing, Sky Casino ensures, in a contract with the MRO supplier
based on Hong Kong and with Qantas Airline in Sydney in order to assure the fastest response
to the problem. Even including the renting of a aircraft, although Casino Configuration will
not be available, will at least provide the transport service.
In event of a long repairing and not complete service could be provide, 60% of the typical
one-way fare will be refund to the customer with reservation in this/these flight/s.
Exceed capacity (passenger without a seat).

If an overbooking situation occurs and it is not notified in a period of seven days before the
flight, Sky Casino will put a compensation or refund, where an alternatives flight is not
possible for the customer. Over the five year period the operations is critical in terms of filling
flights, because only one aircraft is performing the whole amount of flights of the route.
Diversion to another airport

Sky Casino pilots and flight attendants will advise the passengers if a flight is required to divert
to another airport. They will keep them updated during and after the diversion. If the flight
diverts to a city other than the destination, Sky Casino will do its best to continue the flight
to the final destination when circumstances allow. In the event that Sky Casino is unable to
continue the flight to the intended destination, passenger will re-accommodated on alternate
flights or provided by ground transportation to the destination.
Last-minute passenger cancellations

In the event that a passenger with a reserved seat does not cancel the flight with a previous
period of at least 3 days, Sky Casino will add cumulative penalties in order to prioritize
reservations for those customers who never cancel a flight.
Leasing.
Sky Casino ensures the fidelity of the lessor, and prevents from possible cancelations.
Nevertheless, for a variety of reasons, including the ease with which the leases can be
cancelled by the lessor and the lack of “ownership” of the aircraft, wet leasing has been ruled
P a g e 90 | 139
out except short-term acquisition of aircraft that would be employed in meeting peak
demand-type services as outlined elsewhere in this business plan.
Accident.
In case of an accident, Sky Casino will provide authorities with a list of passengers, crew and
cargo on board the crashed aircraft immediately after the incident. The airline will provide co-
ordination to facilitate the rescue operation, care of non-hospitalised passengers and
passenger enquiry. In the event of an aircraft accident within the airport boundary, the main
fuelling franchises will be responsible for defueling and safe keeping of the fuel removed. In
the same scenarios, the handling franchises will be responsible for despatching passenger
steps, buses, cargo loaders and other ramp equipment to the crash site, to facilitate the rapid
evacuation of passengers and unloading of cargo from the crashed aircraft.
On board accident (medical evacuation)

Sky Casino and all its handling partners ensure availability of the medical service and
assistance for a rapid evacuation in the case of an issue affecting health conditions of the
passenger on board.
Passenger conduct on board

In the case of unsuitable behaviour on board, Sky Casino keeps the right of expel the
passenger from the flight or, in the case, cancelling the membership, you conduct yourself
aboard the aircraft so as to endanger the aircraft or any person or property on board, or
obstruct the crew in the performance of their duties, or fail to comply with any instructions
of the crew including but not limited to those with respect to smoking, alcohol or drug
consumption, or behave in a manner which causes discomfort, inconvenience, damage or
injury to other passenger or the crew, you may be disembarked and refused onward carriage
at any point, and may be prosecuted for offences committed on board the aircraft.
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In any business model, it is mandatory to study the legal and fiscal aspects that surround it, in
order to ensure that it is favorably received by them. A great business idea may be non-
actionable if the practice of it, in a particular country (or even area of a country), is limited or
completely prohibited.
Our business model involves some problems and issues of great importance.
The first problematic area is the fact that it is an airline that connects two countries and,
therefore, is an international business. In fact, it not only involves the countries of origin and
destination, but can also cross the airspace of third countries, a matter that must also be taken
into account. In this document, we will present the main results on the investigation of legal
jurisdiction on board an aircraft based on aviation law, applying it to our air transport case
between China and Australia.
The second problematic area is the differentiating aspect of our airline, the possibility of
participating in gaming aboard the aircraft during the international travel. Gambling is an
entertainment whose legislation varies very significantly from one area to another, moving
easily from a total ban to great freedom. In this document, we will see how is the gaming law
in the countries involved in our business model, either as destination, origin, or overflight
country, which are China, the Macao region, Hong Kong, Australia, the Philippines and Papua
New Guiney.
The last important point to consider is taxes. On one hand, taxes on gambling are related to
the previous point, with the same problem of the strong fiscal changes from one country to
another. On the other hand, taxes on airlines as companies of an international nature, which
have very particular characteristics that we will describe extensively.
Other issues will be also covered in this document, like legal form of the company or
certification of cabin layout (which will differ a lot from commercial layouts).
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It is very important to decide the business structure as it has serious influence over the legal
aspects, liability and finances of the company, since it decides how you will be taxed, your
exposure to law suits, how your business will be perceived by stakeholders, your ability to
raise capital, etc.
Let’s summarize the different possibilities (leaving out the ones that are obviously not related
to our case, such as non-profit organization and its variations, trust, foreign company office,…)
and then explain the chosen one, specifying its advantages and disadvantages.
The business structure and bureaucracy might not be the same for different countries, so we
will check the possibilities in Hong Kong and in Australia, since they are the countries from
which it will be easier to operate the route Hong Kong-Sydney.
Australia
 Sole trader: A sole trader business structure is a person trading as the individual legally
responsible for all aspects of the business (although can employ people to help). The
responsibility includes any debts and losses, which can't be shared with others. This
is the simplest, and relatively inexpensive business structure that when starting a
business in Australia.
 Company: A company is a separate legal entity, unlike a sole trader or a partnership
structure. This means the company has the same rights as a natural person and can
incur debt, sue and be sued. The company’s owners (the shareholders) can limit their
personal liability and are generally not liable for company debts. It is a complex
business structure, with higher set-up and administrative costs because of additional
reporting requirements. Additionally, it is mandatory to register a company with the
Australian Securities and Investments Commission (ASIC). Company officers and
directors must comply with legal obligations under the Corporations Act 2001.
 Partnership: A partnership is a business structure that involves a number of people
who carry on a business together. You may choose a partnership over a sole trader
structure for example, if you'll be jointly running the business with another person or
a number of people (up to 20). There are two types of partnerships - general and
limited. Partnerships are governed by the relevant law depending the Australian state
it is registered
Hong Kong
 Sole proprietorship: It is the easiest and simplest form of business. As the name
suggests, the business is owned and operated by a sole person and since the business
is not a separate legal entity, the owner and the business are considered one.
Although this is the simplest form of business it is often considered as the riskiest as
there is no protection of personal assets from risks and liabilities that arise from the
business. While the sole proprietor accrues all the profits from the business, he is
equally responsible (solely and personally) for all the liabilities. This poses a
tremendous financial risk and aspiring entrepreneurs are strongly discouraged from
adopting this form of business. It is relatively simple and easy to register a sole
proprietorship in Hong Kong following the Hong Kong Sole Proprietorship
Registration guide
 Limited liability company: It can be incorporated in Hong Kong by registration with
the Companies Registry under the Companies Ordinance. A company is a separate
legal entity from its members. Companies can be both limited liability companies as
well as unlimited companies. Rarely do investors opt for an unlimited company. A
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limited liability company can be a private company or a public company and limited
by shares or limited by guarantee. The preferred choice for most investors in Hong
Kong is to set up a private ited company, where the liabilities of the owners is limited
to the assets in the company and their personal assets are protected from business
liabilities.
 Partnership: They are defined as businesses that are established and co-owned by
two or more people who join together to carry on the business with a view of sharing
profits. Partnerships in Hong Kong are governed by the Partnership Ordinance and
are of two types: General Partnership and Limited Partnership. The first one is similar
to sole proprietorships, general partnerships make every partner in the firm personally
liable for the debts and liabilities of the business, while the second one liability is
limited to the amount of their unpaid share capital.
Conclusions:
We see that the options are very similar in both territories, as they are in the rest of the world,
including Spain.
We are going to opt for the equivalent of what here in Spain we know as Sociedad Anónima,
S.A. The main advantages are the following:
- The liability is limited

- Easy to transfer ownership
- Easy to raise capital
- The company is a separated legal entity
This advantages overcome the disadvantages, which are mainly the fact that this kind of
structure are heavily regulated, there are big requirements for reporting and that the
incorporation is more expensive.
In Australia it is mandatory to have at least one director that lives in Australia, and the
incorporation fee is 469$ (application 201). In Hong Kong, the incorporation fee is 1720 HK$
and there is no need to be Hong Kong local for the establishment of the company.
For strategic reasons regarding law and taxes we decide to stablish in Australia as a Company.
In Australia for tax reasons (gambling winnings for players are not taxed, as we will explain
later) and stability, and as a Company for the main advantages explained.
In this section we are going to explain in a brief way what is aviation law and how was its
natural development in international grounds. After that, we will check how our business is
included in this legal frame and conclude with how it is affected.
¿What is aviation law?

Aviation law is an area of law studies that involves air travel, civilian flight and some areas of
admiralty law. It includes both legal and business issues. The main characteristic of the
aviation law is that, due to the nature of the studied object, which is purely international, it is
mandatory to create international legislation.
The main law-making body is ICAO, international civil aviation organization, which is an
agency part of the United Nations, and stablishes a series of rules and standards, as well as
participates with a mediating role in between countries.
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The 7 freedoms of the air
In this documents we will use the concept of freedoms of the air. Therefore, we will first
explain this concept.
They are a series of privileges that allow an airline from a country to enter the airspace of
another country. They were formulated as answer to the disagreements about the aviation
liberalization during the Chicago conference (of which we will talk shortly). This privileges are
ordered from the lesser to the bigger degree of freedom, and are the followings:
Transit rights:
1) Right to overflight
2) Right to perform a technical stop, without disembarking people or goods.
Traffic rights:
3) Right to carry passengers from the airline’s country to another country

4) Right to carry passengers from another country to the airline’s country
5) Right to carry passengers between two countries different than the airline’s country,
being this route part of a longer route that includes the airline’s country
6) Combination between 3 and 4, carry passengers between two countries different
than the airline’s country stopping in the airline’s country.
7) Right to carry passengers between two countries different than the airline’s country.
Cabotage rights:
8) Right to carry passengers between to airports of a country different than the airline’s
country, being this route part of a longer route that includes the Airlines country
9) Right to carry passengers between to airports of a country different than the airline’s
country
Chicago convention
After the WWII, there was the most important convention about international aviation law,
involving 191 states.
Some of the most interesting articles regarding our business are the following:
 Article 1: Every state has complete and exclusive sovereignty over airspace above
its territory.
 Article 5: The aircraft of states, other than scheduled international air services, have
the right to make flights across state's territories and to make stops without
obtaining prior permission. However, the state may require the aircraft to make a
landing.
 Article 24: Aircraft flying to, from or across, the territory of a state shall be
admitted temporarily free of duty. Fuel, Oil, spare parts, regular equipment and
aircraft stores retained on board are also exempt custom duty, inspection fees or
similar charges
The convention guarantees the use of the two first freedoms, transit rights, to all member
states. The rest of the freedoms are left to bilateral or multilateral agreements in between
states. However, for scheduled international air services, which is our case, a state can forbid
the transport.
Also, it created ICAO for the regulation of international air navigation.
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Other relevant organizations
 EASA (European aviation safety agency) is an agency of the European Union (EU) with
regulatory and executive tasks in the field of civilian aviation safety. The
responsibilities of EASA include to analysis and research of safety, authorizing
foreign operators, giving advice for the drafting of EU legislation, implementing and
monitoring safety rules (including inspections in the member states), giving type-
certification of aircraft and components as well as the approval of organizations
involved in the design, manufacture and maintenance of aeronautical products.
 FAA (Federal Aviation Administration) is the authority in the EEUU with powers to
regulate all aspects of civil aviation. These include the construction and operation of
airports, the management of air traffic, the certification of personnel and aircraft,
and the protection of US assets during the launch or reentry of commercial space
vehicles. Its regulations are similar to those of EASA.
 IATA (International Air Transport Association) is a trade association of the world’s
airlines. Consisting of 268 airlines, primarily major carriers, representing 117
countries, the IATA's member airlines account for carrying approximately 83% of
total Available Seat Kilometers air traffic. IATA supports airline activity and helps
formulate industry policy and standards.
Gaming is an activity with really varying legislation, as we already claimed before in this
document. In the following section, we will overview the different gaming legislations in the
different involved countries, whether as origin, destination or overflight.
China
Gambling in China is officially illegal under Chinese law. In practice, however, Chinese people
can participate in state-run lotteries and engage in legal gambling in the special administrative
regions of Hong Kong and Macau, whose legal systems resemble those of European countries
which formerly administered those regions (the United Kingdom and Portugal, respectively).
Illegal gambling in China remains common, including unofficial lotteries, clandestine casinos,
and betting in games such as mahjong and various card games. In 2010, The Daily
Telegraph reported that an estimated one trillion yuan are wagered in illegal gambling every
year in China. Online gambling is another outlet for illegal gambling in the country.
Various attempts have been made to establish legal casinos in mainland China, although these
have been unsuccessful. Officials from the province of Hainan have expressed interest in doing
so, and in 2010, the national State Council approved, in principle, the idea of Hainan as a
"testing ground for China's lottery and gambling industry."
Macau
Casino gaming law in Macao follows a restrictive regulatory model, following the theory of
gaming as a “privileged business”. Despite the economic importance of the gaming industry
in Macao, public policy concerns feature a legal framework that takes into consideration the
sensitive nature of gaming.
To begin with, gaming is a legal monopoly of the Executive of Macao SAR, and the exploitation
of this activity is only available to three concessionaires that comply with strict requirements
concerning suitability of actors and financial capacity. In return for gaming concessions, the
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concessionaires pay significant premiums, taxes and contributions, and are bound to a
program of relevant investments in the Region.
In the operation of casinos, these concessionaires are subject to a high degree of control by
the Executive within a relationship ruled by a principle of full disclosure and straight
cooperation; and in order to assure accomplishment of their obligations to the Region,
concessionaires provide significant financial guarantees.
Then, casino junket promoters need to be licensed by the Executive of the Region and
therefore they have to demonstrate suitability. In conducting their activities they are subject
to a high level of control not only by the Executive but also by concessionaires with which
they work, for concessionaires are jointly liable for the acts of their promoters.
Hong Kong
The gambling policy is to restrict gambling opportunities to a limited number of authorized
and regulated outlets. At present, such authorized gambling outlets include horse racing
organized by the Hong Kong Jockey Club, the Mark Six Lottery, authorized football betting
and gaming activities authorized by the public officer appointed by the Secretary for Home
Affair
Therefore, all gambling activities are illegal except those expressly authorized by the
Government under the Betting Duty Ordinance, those licensed by the public officers
appointed by the Secretary for Home Affairs and those exempted under Section 3 of the
Gambling Ordinance (mainly social gambling).
There are two reasons for this policy. First, the conduct of gambling activities should be
authorized and regulated because otherwise unregulated gambling activities can lead to a
number of social problems - frauds, underage gambling, loan sharking, etc. - and become a
potential source of income for triad and criminal activities. Second, since it is impossible to
reconcile the different views in the community on the extent to which authorized gambling
outlets should be allowed to exist, a compromise approach is to allow only a limited number
of authorized gambling outlets.
Indonesia
All forms of gambling in Indonesia are illegal due to the dominant religion of Islam. The Sharia
law forbids all forms of gambling as it considers gambling addicting, evil, and a cause for
people to forget their social responsibilities. Therefore, there aren’t any land-based casinos in
the country. Online gambling is forbidden too and the government blocks foreign gambling
websites.
Australia
Gambling is a very popular pastime in Australia, in many different forms, and most of the
relevant laws are fairly liberal.
Gambling regulation in Australia is done at two levels. Central government takes an active
role in both the regulation of the pastime and also the passing and amending of the relevant
legislation. Regulation also takes place at state and territory level, with several regional
authorities
The Interactive Gambling Act of 2001 (IGA) was passed by the Australian Commonwealth
Parliament with the aim of protecting Australian residents from the potentially harmful effects
of online gambling. It’s targeted at operators, which essentially makes it an offense to
advertise or provide real money online gambling services to the citizens of Australia.
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Australian operators can offer their services to customers in other parts of the world, although
some countries are restricted. They can also offer sports betting and lotteries within Australia,
providing they hold the required license
It is important to explain that gambling winnings are not taxed for the players, since the
Australian government does not consider gambling a profession and the winnings are
supposed to compensate with losses. The only taxation occurs at a corporate level, being the
casinos the ones that are taxed.
Papua Nueva-Guinea
In 2007, legislators passed the Gaming Control Bill that established legal gambling, including
sports betting, lotteries, online gambling, casinos, online gambling and poker in PNG. The new
law also created the National Gaming Control Board to control all forms of gaming activities
and promote community awareness of problem gambling
Even though the 2007 Gaming Control Bill contains a clause that makes it possible for
authorities to prosecute players who participate in unlawful, unlicensed gambling, these
measures mainly target illegal land-based gambling facilities and operators.
There are several topics that require our attention when talking about certification and
compliance with the laws in our business.
First, we see a problem, which is that the acts performed on an aircraft in flight, in addition to
being influenced by the laws normally applicable with independence of the place (subjects'
nationality, expressed or implied will, etc.) have to be, in a certain way, also affected by the
legislation of the nationality of the aircraft in which they take place and by those of the state
which the aircraft overflights.
In our case, what differs from a conventional airline is the fact that you can practice gambling
on board. This activity is not perfectly defined by the application of international
conventions, and its legislation in the various countries is very disparate, meaning that the
legislation to apply can be controversial.
We must highlight that the practice of gaming would consist of a non-aeronautical

infringement, which does not involve the performance of acts contrary to national or
international rules or regulations governing air navigation. Therefore, the plurality of laws is
usually settled by the admission of concurrent competencies. Offenses committed in the
course of air navigation, consisting of ordinary crimes or misdemeanors, although they are a
specialty of the category of competence of the law to be applied, are generally subject to the
same complex rules of criminal jurisdiction, founded on the following bases:
1) Place of the offense, the known principle of territoriality, which subjects to the criminal
jurisdiction of a country all the offenses committed in its own territory with indifference of
any other concept
2) Nationality of the victim, principle by which the offenses committed against nationals are
subjected to the criminal power of a state
3) Nationality of the author, that makes the nation origin of the author competent.
4) Nature of the infraction, real or objective criterion that is based on the protection of the
legal precedents of a state that makes it competent when the infraction is directed against
them
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5) Principle of universal law, based on practical criteria that prevents impunity of crimes by
authorizing any state to know of any infraction
In our case, the only affected base by the fact of being in international flight is the first one.
As specified in article one, the Chicago convention guarantees complete and exclusive
sovereignty over airspace above its territory. That can cause trouble if overflying mainland
China and Indonesia, where gaming is forbidden.
On one side, mainland China is not such a troubling situation since we rapidly go over
international waters and during the short time we could be over mainland China the plane is
during take off/landing, when the passengers must be sitting with the safety belt tied, so there
would be no chance of gaming.
On the other hand, overflying Indonesia can be more difficult. In the worst case scenario,
there is the chance of making a slightly longer route going through the east, overflying Papua
New-Guiney, where gaming is indeed legal. In any case, following the application of the
Chicago convention, an airline of a signing state has the right to overflight another signing
state. This means that we don’t need to warn specifically Indonesia or give specifications
about the activities onboard. Since we don’t make any stop in Indonesia, it is unlikely that the
government of said country would show interest in impending the overflight of our aircraft,
especially since it benefits them because we would have to pay the air navigation fees of an
A380, which are higher than any other aircraft.
The recommendation about this issue is, apart for performing a more in depth study with
lawyers specialized in aviation law, to make the flight with normality following Australian law
and in case of legal issues apply article 3.1 of the Tokyo convention of offenses and other acts
committed on board an aircraft (1963) in which states that: “The state of registration of the
aircraft is competent to exercise jurisdiction over offences and acts committed on board”. This
would be the strongest legal point, besides other legal references.
Another relevant issue that we need to take into account is the certification de la cabin. For
that matter, we will follow EASA indication as read in the document CS 25.803. The FAA has
very similar requirements, so certificating for EASA will lead to FAA certification.
In our case this certification should not be of any trouble, since approval for any subsequent
cabin layout from the conventional one, with a passenger seating capacity of up to but not
exceeding that first substantiated (which is our case, since we have fewer passengers than a
conventional A380) can rely on similarity to the original substantiation by the Type Certificate
holder. In other words, the design organization will show that the new cabin layout is still of
conventional design and that continued compliance to CS 25.803 can thus be assumed on the
basis of not exceeding the maximum substantiated passenger seating capacity indicated in
the Type certificate data sheet.
Since the conventional A380 already complies with the emergency evacuation rules that
require that passengers and crew members to be evacuated from the aircraft to the ground
under simulated emergency conditions within 90 seconds, our configuration with half or less
seats will proof to be safe.
About the cabin crew, the aspects to take into account are two. First, the rule of at least 1
cabin crew for each 50 passengers (ORO.CC.100 (b)(3)), which in our case we will exceed, that
need to have evenly distributed seats. And secondly, the requirement that for a twin aisle
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aircraft such as ours each floor level emergency exit must be supervised by at least one cabin
crew member stationed near the exit.
In this section we will study the payment of taxes from two different points of view. On one
hand, taxes on gambling in the country in which our aircraft will be registered and, on the
other hand, taxes on airlines for the normal development of their activity.
Since, as seen in before in this document, we support the understanding that the law that
applies on board the aircraft is that of the registration of said aircraft and our business will be
based in Australia, we will study the legal frame of that country.
Taxes on airline business

The recommendation of ICAO and IATA is the principle of reciprocal exemption on taxation
of earnings, for which there should be a reciprocal exemption for taxation on international air
travel by States in respect to international airlines. However, some ICAO Contracting States
have not adopted this principle and Australia is one of them.
Australia:
As we can read in the supplement to document 8632 3rd edition of ICAO, Australia’s opinion
to this matter is:
“While we understand that ICAO has the right to make recommendations and resolutions regarding
international aviation taxation issues, we strongly oppose the creation of separate taxation regimes
for particular groups, including international airlines, and would oppose any moves by ICAO to
make its taxation policy binding on Contracting States. Australia’s policy remains that questions
relating to the taxation of international airlines should be dealt with in the context of Australia’s
overall taxation policy. Australia will therefore continue to address these issues only in double
taxation agreements and, less commonly, international airlines profits agreements.”
This means we have to look to Australia policy and taxation agreements, since they do not
follow ICAO’s recommendation directly.
Since there exists a treaty with China, Taxation Laws Amendment Act 1986, we will only be
taxed for the income of our airline in Australia, because is where it will be based.
The taxes that we will pay to the Australian government will come from several sources:
 Departure tax: 55$ per passenger, in any class and to any destination. One of the
highest departure taxes in the world.
 Capital gain tax: There are 52 events that account as Capital Gain Tax (see ITAA
1997 section 104-5) Each event specifies results such as gain, loss, or cost base
adjustment are to be made, and how to determine the date to use for the
transaction. In this document we are not going to study each one of the possible
events and the Capital Gain Tax will be addressed in latter sections of the business
plan, if needed.
 Company tax: It is a direct tax imposed by a jurisdiction on the EBT of corporations
or analogous legal entities, in Australia it is 30%
Taxes on gambling
It varies greatly from one country to another. Let’s see the taxes on gambling in Australia,
since we will follow their legislation.
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Australia:
All the gambling taxation happens on a corporate level. Gambling is not considered a
profession but a game of luck, so winnings are assumed to balance with losses. In addition,
gambling operators, such as casino owners and betting companies, are taxed, so the
government deems those the only pertinent entities to pay taxes. Each state and territory has
different rates of taxation, but players pay nothing
Sidney is part of New South Wales. In this state, For 2015-16, a base rate of 16.41% applies
to gross revenue (i.e. player loss) from table games and electronic gaming machines up to
$712.9m. For gross revenue between $712.9m and $837.8m, the tax rate increases
progressively by one percentage point over 21 revenue bands. A top rate of 38.91% applies
to revenue above $837.8m. The revenue bands, which were set at $5m intervals in 2008-09
starting at $600m, are indexed annually using the Sydney (All Groups) CPI and rounded up to
to the nearest $100,000.
On premium gaming, the agreed tax rate is 10% with a minimum of $6m paid in two
nonrefundable instalments of $3m in January and July each year. The NSW Government is
required to pay the casino a rebate on the gross amount of GST paid on the program.
In addition to that, a Responsible Gambling Levy of 2% of gross gaming revenue is paid

(excluding Rebate Player revenue).
Even if the fact that the possibility to buy products without VAT aboard may lead us to believe
that it is safe to assume we will not pay taxes on the casino business, it is not so immediate.
VAT is a tax that benefits from the fact that the product is being exported to another country,
ant that is not the case for the taxation the NSW state of Australia imposes on casinos.
Therefore, we can see that the Casino Business will pay accordingly to the NSW state, which
stablishes a 16.41% on gross revenues (player loss) for the gross revenues interval in which
our business will be moving (less than 712.9 m).
In addition to that, NSW state charges an extra 2% on gross revenue in the concept of
Responsible Gambling Levy, which is used in order to fund the state program gambling help to
treat gambling addiction and other related problems.
On the other hand, we will pay company taxes as any other corporation in Australia, which
accounts for 30% on EBT. It is important to note that, contrary to the charge on casinos, it is
not a percentage of the gross margin.
In conclusion, we will have a 18.41% on the gross revenues and on top of that a 30% on the
EBT on the company.
We remark that we could make some financial engineering, making two separate entities (a
casino and an airline) having the airline stablished in Hong Kong and the casino stablished in
a third country occupying the space in the aircraft as a foreing office in Hong Kong territory,
allowing us to avoid all taxes for the casino business. However, this would be for the sole
purpose of not paying taxes and those are not the values of our company. We are proud of
leaving a good and generous footprint in the countries in which we operate.
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Let’s summarize the most important aspects.
We are going to incorporate as a company in Australia, based in Sydney (New south Wales).
Even if this kind of structure has big requirements for reporting, we consider that the
advantages (limited liability, easier to raise capital) are more important. The location in
Sydney rather than Hong Kong comes from the stability Australia offers and the inexistence
of taxes to players in gambling winnings.
Our business has a legal basis to operate, even if gambling is forbidden in some countries of
the area. This is due to the convention of offences and other acts committed on board an
aircraft, “The state of registration of the aircraft is competent to exercise jurisdiction over
offences and acts committed on board (Tokio convention 1963)”. On top of that, we could make
a route that would not involve any country with forbidden gambling as a contingency plan.
Taxation will happen at two levels. In one hand, taxation to the casino business in the state
of New South Wales (Australia) is of 16.41% in gross revenue from gambling (for gross
revenue smaller than $701.7m, which is our case) and a levy of 2% in gross revenue from
gambling too. On the other hand, and on top of that, taxation to corporations such as ours in
Australia is 30% of the EBT. To that, we have to add departure tax (A$55 per passenger,
approximately 41USD).
Players will not be taxed on their winnings, since that is Australia legislation. This is a
differentiating point against playing in Hong Kong or Macau.
We will not make financial engineering to avoid taxes on gambling, even if it is a real
possibility it does not agree with the values of our company.
About the cabin layout configuration we will follow EASA indication as read in the document
CS 25.803. Since a conventional A380 already complies with the evacuation requirements,
our configuration with less than half of the passengers will prove to be safe, as long as our
layout keeps unobstructed the corridor and the emergency exits. Our requirements for
customer services guarantees that we will comply with the minimum of cabin crew members,
whose seats must be evenly distributed along the plane.
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Over the years, in the commercial aviation business providing the highest quality service has
been the most awarded and valued benefit from the customer’s perspective, as it has been
presented in the Marketing plan. A key element for a competitive success is going to be
navigating skilfully between poles that most companies think of as distinct: delivering service
excellence in a cost-effective way.
A key challenge of implementing business-level strategies, for instance, the strategy shown
along this document, combined with superior levels of operational efficiency, is the effective
alignment of functional strategies such as Human Resources (HR), marketing or operations
with the business-level strategy. In this plan, we are going to focus how HR strategy is a crucial
aspect of this business and will contribute to Sky Casino’s success through creating
capabilities that support the company’s strategy.
Five interrelated and mutually supportive elements are embraced in Sky Casino’s HR strategy
(figure), along with leadership and role modelling by top management, will play a key role in
Sky Casino’s ability to deliver its business strategy of service excellence in a cost-effective
way.
Along this section where are going to describe how the five elements work and complement
each other.
Straight Selection & Recruitment Processes

As any HR strategy beings with recruitment, where Sky Casino adopts a highly rigorous and
strict selection process. It is emphasized the importance of looking for cabin crew members
who can empathize with passengers and are cheerful, friendly and humble. For instance, Cabin
crew applicants are required to meet a multitude of criteria with an initial screening looking
at age ranges, academic qualifications and physical attributes.
The subsequent recruitment interviews comprise of three rounds:
a) Applicants (ten-people group) are asked to introduce themselves and answer a

question posed by the interviewers. They are assessed on their command of English
and Chinese, confidence, and grooming according to the position requirements.
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b) Applicants (six-people group) are divided into two groups and given a topic to debate.
They are assessed on their ability to work as a team and whether are able to present
their arguments in a logical a convincing manner. For the second half of the interview,
applicants are given passages to read to test their enunciation.
c) One-on-one interviews with management are carried out to assess the candidate’s
aptitude and suitability for the position.
This meticulous selection process ensures with reasonable certainty that Sky Casino hires
applicant with the desired attributes. Despite the stringent procedures and strict rules about
appearance and behaviour, Sky Casino looks for many educated young people around both
regions apply to join, Sky Casino looks for to be perceived social status and glamour
associated with the business which is run in its aircraft. Sky Casino’s objective is to obtain the
reputation of a service leader in the airline industry and an extensive developer of talent
enables it to have its pick of applicants.
Extensive investment in training and retraining

Sky Casino places considerable emphasis on training, which is one of our focal points in our
HR strategy. Sky Casino invests huge amount of money in infrastructure and technology, but
ultimately, we need the people to drive it. At Sky Casino, we believe that people actually do
make a difference, so the company has in place a very comprehensive and holistic approach
to developing our human resources. Essentially, we do two types of training, namely
functional training (for instance, croupier training for flight assistant) and general
management-type training (for top and mid management).
Even though training is often emphasized as a key element of success in the service business,
Sky Casino is planned to be the airline with the highest emphasis on this aspect. Newly
recruited cabin crew are required to undertake intensive 24-week training courses – the
longest and most comprehensive in the industry in front of the 15-week training in Singapore
Airlines. Sky Casino training aims to enable cabin crew to provide gracious service reflecting
warmth and friendliness, while maintaining an image of authority and confidence in the
passengers’ minds. Sky Casino’s training includes not only safety and functional issues but
also, beauty care, gourmet food, wine appreciation, a master in card dealing as well as the art
of conversation.
If Sky Casino’s operation meet the high standards as planned, the reputation for service
excellence will grow stronger, therefore the customer tend to have even higher expectations,
which increases the pressure on its frontline staff. Then, Sky Casino’s challenge is to help our
staff deal with difficult situations and take the proper tools. Sky Casino is here to help our
staff deal with the emotional confusion of having to satisfy and even please very demanding
customer, without feeling that they are being taken advantage of. Sky Casino strategy is to
apply the former Singapore Airlines CEO, Dr. Cheong Choong Kong, vision “to the company,
training sis forever and no one is too young to be trained, nor too old”.
Continuous training and retraining is vital to Sky Casino to consolidate service excellence by
equipping staff with an open mindset, to accept change and development, and to deliver the
brand new on board service which Sky Casino deploys on its aircraft. Sky Casino, has planned
four different training schools to be outsourced. The four school cover from corporate
learning, flight assistant, technical crew and flight operations. The former is planned to offer
general management training for all staff. Also, it is going to be provided executive and
leadership programmes for all staff management with the objective of generating effective
managers and visionary leaders, this part has been reach a partnership agreement with IESE
Business School in its site in Shanghai. Inside, this corporate learning is included customer
service training and sales and commercial training.
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The aim for the training programmes is to support a key pillar of Sky Casino, Customer Service,
which involves the different operational areas and support functions. To ensure that Sky
Casino culture is promoted along the whole company, all management programmes are
embedded in this principle. The different programmes aim at building team spirit among our
staff in key operational areas so that together, we will make the whole journey as pleasant
and seamless as possible for our passengers. Everyone has to realize that it is not just the
ticketing or booking staff and the cabin crew who come into contact with our passengers. The
pilots, land operation managers have a role in customer service as well, because from time to
time, they do come into contact with passengers. In our training policy is not only about
people, there is the 40-30-30 RULE, which is an approach to people, processes (or
procedures) and products. Sky Casino focus 40% of the resources on training and invigorating
our people, 30% on reviewing processes and procedures, and 30% on creating new product
and service ideas”
Sky Casino’s leadership and relationship management with staff play a key role in the success
of its training initiatives. Sky Casino’s managers assume the role of mentors and coaches to
guide new employees with high capacity and expectations, rather than just being managers
and superiors.
Sky Casino is planned for the horizon further than five years to deploy a job rotation approach
to allow management to obtain a better picture of the organization. Rotating to other
departments every two to three years enables managers to develop a deeper understanding
of operations at other areas of the organization. This practice promotes a corporate outlook,
reduces the likelihood of inter-department conflicts, and facilitates change and innovation, as
people bring fresh perspectives and approaches to their new roles. Constant job rotation will
be a core part of employee learning and development.
Successful Service & Delivery teams.

The nature of the working environment on board requires people to work effectively as a
team to deliver service excellence. In fact, effective teams are often a pre-requisite to service
excellence. In view of this, Sky Casino aims to create esprit de corps among its cabin crew. The
crew members are formed into ‘wards’. Each ward consists of about 5 crew, led by a ‘ward-
leader’ who acts as a counsellor to guide and develop the less experienced crew members.
Ward leaders issue newsletters for their teams, and organize face-to-face sessions and
activities with their ward members. These activities include inter-ward games and full-day
engagement sessions on ground.
The ward leaders learn about their ward member’s individual strengths and weaknesses, and
acts as counsellors to whom they can turn to for help or advice. Three also ‘check trainers’
who often fly with the teams to inspect performance and generate feedback that aids the
team’s development. With this policy, team leaders are able to monitor and point out what
can be improved in the crew, team leaders are the ones to evaluate the crew, monitor staff
development, staff performance, and supervise them. They see the feedback and monitor
back the performance.
Sky Casino’s management believe that the interaction within each of the teams is very strong.
As a result, when team leaders do staff appraisal, they really know the staff and therefore,
staff record is shown in the most meticulous and detailed way. This makes identification of
the staff’s strengths and weaknesses really an easy work. Also, it allows management to have
a good control of the performance, ensuring that the crew delivers their best service. In case
of any problem on board, it will be known immediately and send the person or people in
question to retraining. Also, the selection for promotion it is easily performed.
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Sky Casino also has planned to organize activities that reach out to the wider crew population.
The management staff have frequent interaction with crew members over food and drinks.
The senior crew members are invited for full-day engagement sessions with the management.
Sky Casino’s employees is going to be engages even in some unrelated activities; for example
in diverse groups whose activities cover arts, sports, music or community service. These
interest groups provide and avenue for employees to come together to pursue their passions
outside of work. This help teams to further develop team spirit. Sky Casino firmly believe that
such activities encourage empathy for others, an appreciation of the finer things in life,
camaraderie, and teamwork, and therefore, support members who set up interest groups.
Empowerment of Frontline Staff to Control Quality

As far as the time goes, the soft skills of flight crew and other service personnel get sharpen,
leading to service excellence that is difficult to replicate, not only in terms of how the service
is delivered, but also in terms of the mindset that supports this delivery.
Sky Casino wants to empower their employees in order to expend discretionary effort. It is
pertinent that employees are able to make decisions independently, as frontline staff
frequently have to handle customer on their own, since it is not feasible or even desirable for
managers to constantly monitor employee’s actions. Sky Casino want to emphasize that staff
must have a clear concept of the boundaries of their authority and that it is the responsibility
of management to communicate and explain the empowerment limits. Empowerment of the
front line is especially important during service recovery processes and in situations where
customers have special needs.
Motivating Staff through Rewards & Recognition

Reward and recognition is one of the key levers in Sky Casino to encourage appropriate
behaviour, emphasizing both positive as well as undesirable practices, and recognize
excellence. Sky Casino will employ various forms of rewards and recognition including
interesting and varied job content, symbolic actions, performance-based share options, and a
significant percentage of variable pay components linked to individual staff contributions and
company’s financial performance. Sky Casino will keep base salaries as regular retribution for
aviation industry and offering employees bonuses of up to 50% of their annual base salary, a
formula which depends on their own performance and Sky Casino’s profitability. The potential
international award which Sky Casino could fight for serve as further sources of motivation.
Sky Casino will also hold company-wide meetings to keep staff updated about latest
developments, and circulates newsletters. For Sky Casino, all is about communication, for
instance, in case a new service is added at check-in, people involved before, during and after
implementation should be totally concerned. It will be discussed the importance and value of
it, and make sure everyone is aware of what we are implementing and why. It helps to give
staff pride in what they do.
Communication also aids in recognizing service excellence. Staff going the extra mile receive
recognition through honours such as the annual CEO transformation awards. Sky Casino will
emphasize the importance of this kind of events which can be more motivating than the mere
financial rewards. Sky Casino will put in a lot of effort to ensure that heroes and heroines are
recognize for the commitment and dedication.
Sky Casino’s reward and evaluation system is planned to be highly aligned with the desired
behaviours. They key element is “on board assessment”, which combine image, service
orientation, product knowledge and job skills, safety and security knowledge and adherence
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to procedures, work relationship and forwards leaders and management level will be assessed
by additional factor of people management skills.
The organization of the company is established according to the way of working, making some
differentiation between the direct functions in our company and the supporting departments.
The organizational chart is defined trying to make easier the information flow within the
company, gathering in the same department those staff whose task directly related. The
company is composed by six departments managed by the CEO of the company according to
the Board of directors. The departments are: Commercial & Marketing, Operations, Financial,
Human Resources, Legal and Corporate Services. The CEO of the company will be support by
his/her CEO assistant and Senior Advisor.
Managers roles and responsabilities

The company is managed by the CEO of company according with the strategy established
together with the board of directors. The power in the decision will be determined by the
number of shares owned by contract for each part.
CEO
Lead the company according to the strategy defined with the Board of directors and the investors,
matching the different departments to achieve the goals proposed.
Lead the company to fulfill the goals set by the Executive Board
Lead and coordinate all the departments
Goals Maintain good relations with the different customers
Maintain a smooth flow of work between departments
Solve interdepartmental conflicts
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Report to the Executive Board
Make sure that the activity of each department is aligned with the company's goals
Make sure the milestones are going to be reached in quality, costs and time
Together with the board of directors/ supervisory board establish the objectives,
mission and vision of the company
Responsabilities
Managing cost control
/ Main task
Give support for making the Strategic and tactical planning
Quality management
With the financial department preparation and content of all financial documents
including budgets and financial statements
Carry out the HHRR policies together with the department managers
Mid- career (5-10 years) as a manager in an international company
Background Work experience in an Casino/Airline will be taken into account
HHRR and financial experience
Be able to read and analyze a great detail of information in a short time
Good judgment to make a decision
Global vision of the company
Competences
Negotiation skills
Languages (English is mandatory, Mandarin Chinese is a plus)
High communication skills
COMMERCIAL & MARKETING MANAGER

Create, keep and improve the relation with the customers, creating a strong clients network, at the
same time that new potential markets are studied and the marketing plan of the company is defined
and performed.
Achieve the market expected through the marketing plan, and determine the new
potential markets
Obtain profitable management of projects and contracts
Aligned financial strategies with strategic goals
Goals Establish the "Golden rules" of the customers behavior
Supervise the obtaining of the largest amount of contracts and clients
Determinate customers needs and provide the information to operation department
Keep demand stable
Agreement with operational plan
Report to the general manager
Fix the departments goals according with the general objectives of the company
Customer’s relations from the meeting point to the end, including direct contact with
Responsabilities the customers, contract redaction and firm, customer service.
Determinate potential market and continuous market monitoring predicting its
/ Main task evolution.
Create and manage a commercial and marketing plan to achieve fulfill market
objectives and a plan for the engagement and retentions of the customers.
A close demand tracking
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3-5 years of experience in sales, international marketing and procurement
Background
Graduate
Team building
Innovative mindset
Ability to identify and develop business opportunities
Competences
Extensive diplomatic and business negotiation skills
Languages (English & Mandarin Chinese are mandatories)
Customer focused
OPERATIONS MANAGER
According with the information provided by the Commercial & Marketing department manage a
strategy to reduce cost, keeping the quality of the service.
Lead and coordinate operations department

Aligned technical strategies with strategic goals
Goals Supervise the developing of the service on time, cost and quality
Agreement with operational and commercial plan
Manage demand fluctuations
Report to general Manager
Create, and manage a operational plan to achieve the market objectives of the
Responsabilities company
/ Main task Create, and manage an operational plan according to the financial, strategy and
market objectives
Continuously monitoring and analysing the operational activities
Full understand customer's requirements
3-5 years of experience in airline operations or similar
Background Air legal environment knowledge
5 years degree
Ability to identify clients' needs
Team building
Competences Extensive communication skills
Strong leadership qualities
Languages (English is mandatory, Mandarin Chinese is a plus)
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FINANCIAL MANAGER
Manage the budgets according to the financial goals defined

Goals Cost containment
Cash flow management
Report to general Manager
Responsabilities Managing cost control
/ Main task Tax planning
Deploy an accurate record cost system
Supervise the management of every department budget
5-7 years of experience in financial, internationals companies is desirable
Background
Airlines legal environment knowledge is mandatory
Global vision of the company
Competences
High communication skills
Languages is mandatory (English, mandarin Chinese should be taken into account)
HUMAN RESOURCES MANAGER
Manage the budgets according to the financial goals defined. Manage personal and development of
the team and workers in the company

Goals Cost containment
Cash flow management
Report to CEO and CEO assistant
Responsabilities
Managing cost control
/ Main task
Tax planning
Supervise the management of every department budget
5-7 years of experience in financial, internationals companies is desirable
Background
Excellent analytical skills
High communication skills and team worked
Competences Excellent time management skills, responsible and good knowledge about law field in
term of financial laws.
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LEGAL MANAGER
Guarantee that the company strictly follows law guidelines and give legal advice to management
about all relevant issues
Agreement with CEO's and CEO's assistant decision

Complies with all legal requirements , airworthiness and feasibility of the project in
Goals Australia
Obtain relation with external parties (regulators, external counsel, public authority
etc.), creating relations of trust
Good communication with all the team, so as to achieve a excellent publication of our
business
Responsabilities Knowledge as to undertake in Australia and China from the legal point of view
/ Main task Provide clarification on legal language or specifications to everyone in the organization
Maintain current knowledge of alterations in legislation
Collaborate with management to devise efficient defense strategies
Entry level career (<2 years) as manager assistant/secretary in an international
Background company
Knowledge of International law
Excellent and strong communication skills
Responsible and good knowledge about law field
Competences
Team building
CORPORATE SERVICE MANAGER
Lead, manage and develop administrative staff, volunteers and contractors to ensure the efficient &
effective operation of Corporate Services and the provision of timely & accurate information
Agreement with CEO's and CEO's assistant decision

Manage and develop IT functions
Goals
Obtain relation with external parties (regulators, external counsel, public authority
etc.), creating relations of trust
Develop new and or revised services in areas of responsibility
Responsabilities
IT tasks
/ Main task
Collaborate with management to devise efficient defense strategies
Entry level career (<2 years) as manager assistant/secretary in an international
Background company
Demonstrated experience in managing staff
Excellent and strong communication skills
Competences Team building
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Managers Staff planning
Once the different departments and positions inside them are clearly defined and the
company launch plan is determined the number of employees and the evolution along the
years is established.
One premise taken into account when the staff was determinate was the desire of keep
constant or increase the number of employees. In some cases, was not possible because the
HHRR expenses go up no being possible assign overstaff to other functions because some of
them has a very specific role in the company.
The Staff evolution is considered achieving the maximum number of customers allowed for
the current fleet. The crew has been considered in Operational Plan, where it can see their
evolution too.
The trend is clear, the staff increase as the years go by as we increase our flight operations.
Especially Sales Agent and Customers Supports increase as well as Operational Staff.
Contracts type
The kind of contracts comply with the Australia labour law and try to respond to the different
needs of the company considering the different roles played by each member of the staff.
As one of the value proposition and company value of Sky Casino is a specialized treatment
to our customers, the company will follow a HHRR policy that guarantee a low rotation rate
of the staff, what means a big percentage of fixed contracts. On the other hand, to avoid an
excessive expense on salaries the strategy followed will be a low number of positions with
very good conditions and a big level of involvement within the company. The type of contracts
for each role is shown in the next section.
Wage Policy
Sky Casino will establish a wage policy that reflects the importance that the staff has inside
the company. As the company is registered in Australia, and its headquarters will be also there,
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the remuneration policy is defined in such a way that accomplish with the “Australian
Employment Legislation”, and the standards of living there.
The wage policy is composed by the base salary (some variable amount for some of the
positions is considered too), plus the annual bonus. As the employees are the main value of
the company it is thought that the salary should go farther, providing medical benefits that
allow them feel comfortable within our company, keeping them out of some of the daily
problems. The wage policy includes some others benefits as mobile phone, computer, car or
hosting depending on what position is taken.
Baseline
According to the “Australian Employment act” it is defined as 12 annual wages that will be
paid in the first seven days of the month. It is determined depending on the level of the
position, and the function. Generally, it is a fix amount of money except in those positions in
which the performance requires break down in a fix payment plus a variable amount.
The Crew baseline is based on the “Australian Aviation Fair Work Commission”, reflected in
the Operational Plan. The Managers baseline is based, besides the “Australian Employment
Legislation”, on the “Qantas Annual Report 2016”. We have focused on our main competitors,
adapting the remuneration to our business model.
Bonus
The aim of this part of the salary is reward those employees who being engaged with the
company achieve the objectives fixed. These goals or priorities are set at the beginning of
every year regarding the company strategy and have two different sections: department
objectives and personal objectives.
The goals of each department are defined by the top level of Sky Casino, always considering
the strategy for the entire company. The employee objectives are established by the own
employee according to the general and specific objectives and with the approval of their
manager.
At the end of the year each employee will be evaluated by their manager, who will score the
level of accomplish of each objective set, getting a maximum scored of 1,3. The same way to
procedure will be carry out but with the department goals, in this case the evaluation will be
performed by the CEO together with the board of directors, the final mark will be at maximum
1,4.
Medical benefits
It is defined three different level of insurance
- Full. It includes a complete medical service with all the benefits including dental
coverage.
- Full without dental service. The same as the previous service but excluding dental
coverage
- 70% of medical coverage. A more simply insurance, but with very good conditions
that will cover the 70% of the medical expenses.
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Following the same rules, the employees will get one or other insurance depending on the
position inside the company, the origin country of the person will be taken in to account too.
Other benefits
In this category, it is considered the enterprise mobile phone, computer, car, house or hosting
of our crew depending their origin. In this case, the way to assign these privileged to staff will
be depending on the function that the person carries out within the company, no matter the
level of the position.
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Finance is one of the key points of any business plan. Here it will be proved the economic and
financial viability of the company, along with the funding sources inside the operating
conditions considered in this business plan.
This Financial Plan has been made following the Australian legislation. There is where Sky
Casino enterprise is going to be based. Taxes and salaries will be paid in Australian territory.
Every accounting aspect of this financial plan follows the principle of being a reliable and
accurate representation of the enterprise as it is and what is fondly believed that can be
achieved in the future.
Up to this point, many assumptions have been made and proven as reality afterwards. During
this chapter, they are not going to be tested again, just mentioned to support any data that
will appear from now on. From any cost to revenues, funding strategies or legal liabilities will
be compiled in the next lines and they will interact to prove the economic viability of this Sky
Casino project.
One way as good as any to walk everyone through the financial requisitions of any enterprise
is to take a look at their financial statements. Following them as guide Sky Casino finances
will now be presented.
P&L Account
Revenues
Revenues are the reason why of any enterprise. During the marketing plan, it has been
explained that there are 2 revenue streams in this Sky Casino business. The first one is based
on airplane tickets from the airline slope of this enterprise. Just as a little reminder and very
connected to these expected revenues is interesting to remember that Sky Casino is oriented
to a very specific customer. The market has been defined before as more or less 350 thousand
HNWI that live in the provinces around the HUB airports that Sky Casino is going to operate.
To understand correctly if the revenues expected from now on are too optimistic or not you
can see here the expected market share evolution from a very specific customer segment
with a new innovative product completely oriented to satisfy their needs. As you can see, at
it is prime in the fifth year the market share expected less than a 30%. This data justifies the
expected occupation of 95% of the plane.
Expected Market Share Evolution Expected Market Share

100,00% in 5th Year
90,00%
80,00% Sky Casino Competence
70,00%
60,00%
50,00%
28,84
40,00% 28,84%
25,58% %
30,00% 19,94%
20,00% 12,00% 71,16
10,00% 4,80% %
0,00%
1 2 3 4 5
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As any other AIRLINE, Sky Casino will charge their customers for take them from China to
Australia, or the other way around, in a luxury A380 plane with premium/business class seats
and service. The competence ticket average price is around 4.000 USD per round trip in
similar circumstances and class. Having in mind that Sky Casino is targeting High Net Worth
Individuals price could be higher but, as explained in the Marketing Plan before, the price per
one way ticket will be an average of 1.900 USD per customer.
Tickets Average Price The other revenue stream in this business will
$ 1,900.00 be the income produced from GAMING
Max. Gaming Rev/h flight ACTIVITY. The casino floor has 106 slots
available and there is and personalized digital
$ 36,342.86
gaming entertainment system in every seat.
Average Gaming Hours
The targeted customer is a HNW individual
7 hours that is used to spend an average of 600 USD
Pax. Max. Capacity per hour gaming. The gaming decks will be
160 pax opened 7 hours per trip and assuming
Pax. Max. Casino occupancy peaks in the gaming tables, that not
106 pax 100% of the passenger will be HNW
Gaming Average Expense per pax individuals, occupancy levels that increase in
$ 2,400.00 time as explained in the Operational Plan.
Gaming Average Expense per hour per pax Based on all this and the studies mentioned in
the Marketing Plan is safe to assume an
$ 342.86
average expenditure in gaming related
activities of 340 USD per hour gaming per customer. This amount is gaming expense,
revenues minus gaming prizes that might be paid to lucky customers. Following the same
occupancy ratio in the gaming decks till seats saturation that the whole plane the next
numbers are the results of operating an A380 Sky Casino in revenue terms.
This is the most critical number in the whole project. Therefore, it has been so good
researched, tested and proved viable. In addition, a lower amount has been selected that the
one obtained to not to be too optimistic. Having in mind that this is the most critical point of
the project, a sensibility test will be done at the end of this plan. The purpose of it will be to
determine the minimum amount of money that would make the enterprise profitable.
This are the expected numbers run for the 5 first years of live of Sky Casino:
# Flights Pax Average/Flight Total Pax/year % Occ Flight (160 max) % Occ Casino (106 pax) Market Share
1 Year 174 96 16,704 pax 60.00% 60.00% 4.80%
2 Year 348 120 41,760 pax 75.00% 75.00% 12.00%
3 Year 510 136 69,360 pax 85.00% 85.00% 19.94%
4 Year 618 144 88,992 pax 90.00% 90.00% 25.58%
5 Year 660 152 100,320 pax 95.00% 95.00% 28.84%
Market Volume 347,870 pax 100.00%
Revenues 1 Year 2 Year 3 Year 4 Year 5 Year

In Millions 47.67 million $ 123.33 million $ 204.85 million $ 262.83 million $ 296.28 million $
% Increase 158.70% 66.09% 28.30% 12.73%
COGS
Costs of goods sold refer to amount of expenses that must be done to produce revenues that
are directly related to each customer that the company has. This means that and increment
in one customer means an increase in this costs amount.
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From the nature of this enterprise, Sky Casino has a small quantity of cost in this cost item.
Most of them are costs directly related to passenger consumption. For example, food, drinks,
a “passenger travel” kit that is handed to them as part of the business quality service… The
assumptions taken for granted after a detailed research are:
AIRPORT FEES Passenger 40.85 $/passenger

HANDLING Variable Handling 90 $/passenger
Food 120 $/passenger
CONSUMABLES Drinks 100 $/passenger
On board services 60 $/passenger
Fixed Costs
Here it comes the biggest cost item for Sky Casino Enterprise. As most of the airlines
companies Sky Casino needs huge assets in its balance sheet to able to operate. Those assets
are Planes, in this case an A380 valued in more than 300 Million Dollars. There are only 2
ways to acquire it, buying it or leasing it. Both options have been considered and the most
interesting is a financial leasing with the next conditions:
Leasing Data Negotiated Terms

A380 Price $280,000,000.00
Down Payment 15-25% 20%
Terms Up to 20 years 20 years
Interest Rate 4-5% 5%
Plane Depreciation 20 years
It is very similar to contract a really big debt with the leasing company and to buy it because
the ownership of the plane is transferred to the lease company, in this case Sky Casino at the
moment of the down payment. And then contract a debt with a 4.5% of interest for 20 years
duration. At the end, the property of the plane is for the leasing company, on the other hand,
Sky Casino can out of the contract whenever it need with a preassigned economic penalty.
This means that Sky Casino is deeply leveraged company. Leasing means between a 3% and
a 7% of the expected revenues of the company.
1 Year 2 Year 3 Year 4 Year 5 Year
Leasing Liability $ 298,984,000.00 $ 278,712,000.00 $ 258,944,000.00 $ 239,680,000.00 $ 220,920,000.00
Downpayment $ 56,000,000.00 $ - $ - $ - $ -
Montly $ 11,200,000.00 $ 11,200,000.00 $ 11,200,000.00 $ 11,200,000.00 $ 11,200,000.00
Interest $ 9,576,000.00 $ 9,072,000.00 $ 8,568,000.00 $ 8,064,000.00 $ 7,560,000.00
Total Leasing Payment (CF) $ 76,776,000.00 $ 20,272,000.00 $ 19,768,000.00 $ 19,264,000.00 $ 18,760,000.00
There are some other Fixed Costs that must be considered. For example, a strong fixed cost
is Fuel Consumption, it represents for typical airlines a 40% of the costs of the company. At
its prime (5 years running) it means a 38.07% of the total fixed costs of the company for Sky
Casino. On the other hand, as a mixture between airline and Casino it only means 12.68% of
the revenues at company’s prime. This shows the difference between typical airlines with only
one revenue stream and this merged alternative that is Sky Casino. Fuel is considered a fixed
cost because it need to be paid no matter if the plane is empty of completely full. It is an
operative cost and it is not related to the number of customer.
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Fuel 1.55 $/gallon
Consumption 4,000.00 gallon/hour
FUEL
Flight Hours 10 hour/flight
per travel 62000 $/flight
MRO MRO 13,500.00 $/flight
Parking 925.92 $/flight
AIRPORT FEES
Enroute 3,205.34 $/flight
HANDLING Fixed Handling 1,000,000.00 $/year
CSR % Gaming Revenues 2.00% of revenues
RECONFIG & CERT Onetime payment 15,561,000.00 $
There are some other fixed costs as salaries, training, marketing or corporate social
responsibility. This is a fixed cost breakdown over the 5-year horizon:
0 Year 1 Year 2 Year 3 Year 4 Year 5 Year
Fuel $ 10,788,000.00 $ 21,576,000.00 $ 31,620,000.00 $ 38,316,000.00 $ 40,920,000.00
Fixed Airport Fees $ 718,839.00 $ 1,437,677.99 $ 2,106,941.89 $ 2,553,117.81 $ 2,726,630.68
Fixed Handling $ 1,000,000.00 $ 1,000,000.00 $ 1,000,000.00 $ 1,000,000.00 $ 1,000,000.00
Marketing $ 40,000,000.00 $ 38,000,000.00 $ 36,100,000.00 $ 34,295,000.00 $ 32,580,250.00
Human resources $ 12,669,200.00 $ 15,202,650.00 $ 14,662,677.50 $ 18,635,663.49 $ 18,256,556.43
Corporate Social Responsibility $ 318,712.32 $ 879,778.80 $ 1,461,241.80 $ 1,874,838.96 $ 2,113,491.60
Leasing $ 67,200,000.00 $ 11,200,000.00 $ 11,200,000.00 $ 11,200,000.00 $ 11,200,000.00
Total Fixed Costs $ 132,694,751.32 $ 89,296,106.79 $ 98,150,861.19 $ 107,874,620.26 $ 108,796,928.70
Fixed Costs Structure (5th year)

Fuel
10,29%
1,94%
Fixed Airport
Fees
Fixed Handling
37,61%
16,78%
Marketing
Human
resources
Corporate Social
Responsibility
2,51% Leasing
0,92%
29,95%
Depreciation
There are two kinds of assets that need to be depreciated in the Sky Casino finances. The first
kind is the usual one, fixed assets such as buildings purchased as office and all kind of facilities
needed. These assets are going to depreciate within 10 years on average.
The other kind is of course the plane as a fixed asset that Sky Casino has on property. This is
a special circumstance because of this airline part of the company. Having in mind that the
leasing transferred the plane ownership to Sky Casino it need to be depreciated to be
compliant with the best representation principle of financial statements. Intimately related to
this is where the MRO expenses go. They are going to be treated as Investment financial item
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because they increase directly to the value of the plane. This means that the value that is
going to be depreciated increase over the time with these investments.
Depreciation 1 Year 2 Year 3 Year 4 Year 5 Year
Other Assets Depreciation (yearly) $ 500,000.00 $ 500,000.00 $ 500,000.00 $ 500,000.00 $ 500,000.00
Plane Depreciation (yearly) $ 14,778,050.00 $ 14,895,500.00 $ 15,130,400.00 $ 15,474,650.00 $ 15,891,800.00
Total $ 15,278,050.00 $ 15,395,500.00 $ 15,630,400.00 $ 15,974,650.00 $ 16,391,800.00
Accumulated Depreciation $ 15,278,050.00 $ 30,673,550.00 $ 46,303,950.00 $ 62,278,600.00 $ 78,670,400.00
Interests
Interest paid are a high cost to this enterprise because of, as said before, it is very leveraged
to be able to acquire such a big asset as a A380 airplane is. There are of course, two debt
sources and two interests’ costs in concordance. The first is the debt contracted to banks to
finance enterprise operations and the second one is linked to the leased liability. The first one
is contracted at a 5.7% interest rate on average as a credit line with a bank. The second one
as accorded to the leasing company is going to be 4.5% interest rate over the rest of the
leased assed value yet to be paid. This means the next values over the years:

5.7% Bank Interests $1,026,290.21 $2,972,386.40 $3,145,062.87 $3,375,397.47 $3,383,217.63
4.5% Leasing Interests $10,260,000.00 $9,720,000.00 $9,180,000.00 $8,640,000.00 $8,100,000.00
Taxes
This part answers directly to a legal constraint. As explained before in the legal plan Sky Casino
needs to pay as any other enterprise taxes to the Australian government where it is based.
This means a 30% retention over EBT. But it means, according to Australian legislation,
another tax obligation. One that is imposed over gaming activities. This is going to be 16.41%
over gaming revenues.
Australian law also enforces gaming related enterprises to destine 2% of their total revenues
to Corporate Social Responsibility in favour of gaming addicts. This is explained here but it is
considered in the fixed costs financial item explained before.
In conclusion, taxes mean a total amount over the years of:

30% Enterprise Taxes $(35,902,226.40) $283,542.33 $21,683,826.60 $35,839,708.30 $45,454,930.13
16.41% Gaming Rev Taxes $3,268,793.23 $9,023,231.32 $14,986,861.21 $19,228,817.08 $21,676,498.22
P a g e 122 | 139
Income Statement
Considering all the paragraphs before it’ll be shown the Income Statement of the enterprise
at its prime after 5 years running if expectations are meet. The Costs Break-Down over the
years and compared to the revenues is the next:
Income Statement
Period 5th Year
Revenues 296.28
COGS 41.22
Gross Margin 255.07 Revenues over Costs 400,00 M€
350,00 M€
Fixed Costs 109.60 296,28 M€
262,83 M€ 300,00 M€
EBITDA 145.47
204,85 M€ 250,00 M€
200,00 M€
Depreciation 18.39 123,33 M€ 150,00 M€
EBIT 127.08
100,00 M€
50,00 M€
Interests 2.77
0,00 M€
Leasing Interests 8.10 *
*Negative Taxes Value Because of Negative EBIT -50,00 M€
EBT 116.21
-100,00 M€
Taxes 34.86 COGS Fixed Costs Interests
Gaming Taxes 17.34 Taxes Leasing Revenues
Net Income 64.00
Dividends 35.00
Net Income Available 29.00
Balance Sheet
In this chapter, it’ll be visible the balance sheet of the enterprise at its prime after 5 years
running if expectations are meet. It will be shown graphically how big different Assets and
Liabilities are related to the others having in mind that they must meet each other in
aggregated volume.
P a g e 123 | 139
This will show easily some ratios and will give a quick overview of the company way of
operations and risks:
Balance Sheet
Period 5th Year Current Assets
Fixed Assets 15.00

Leasing Asset 337.84
Acc. Depreciation 88.67
Fixed Assets 264.17
Inventories 2.26
Receivables 0.70
Cash 7.03
Current Assets 9.99
Total Assets 274.15
Common shares 125.00

Other (Reserves, …) (128.19)
Net Income Available 29.17
Equity 25.98
Long Term Debt 40.05
Leasing Liability 180.00
Short Term Debt 4.45

Payables 10.16
Accurals 13.51
Current Liabilities 28.12
Total Equity & Liabilities 274.15
P a g e 124 | 139
Some significant Sky Casino ratios at year 5th are the next ones:
Debt Ratios
Leverage Ratio (Total Debt Ratio) 83.4%
Credit Ratio 7.9%
Debt to Equity *Liability to Equity 5.04
Equity Multiplayer 6.04
Cash Coverage Ratio 16.82
Profitability Ratio
ROA (Return of Assets) 26.6%
Profit Margin 22.8%
Equity Structure
The initial investment required to be able to launch and make this Sky Casino enterprise viable
is 125 million dollars.
63 M$ will be invested by Star Casino from Australia. It is the only big casino in Sydney.
Almost a monopoly in a big country that likes to gamble put it in a very good position. But
growing is not easy from this supremacy positions. That is why this investment make sense.
It connects his main casino with the biggest, most crowded and gaming oriented country of
the world. If this was not enough, gaming is forbidden in mainland China and Macau hotels
and Casinos are getting saturated. Sky Casino makes perfect sense right now. All this, as
explained all along this plan, justifies this investment.
In exchange of it, Star Casino will hold 51% of the equity and act as owner and partner with
Sky Casino and bring both training and customer streams from his own main Casino.
25 M$ will be invested by our private equity/consultant firm that dedicates itself to launch
new business lines and guide them during its first years. This will hold 20% of the equity and
the directive positions of the enterprise.
The rest 37M$ are in search of a Venture Capitalist Firm or Private Equity Entity to invest in
them and hold 29% of the equity. The plan foresees and easy out for this part in year 5 of the
enterprise. Star Casino trust this kind of partners to diversify risk while launching a new
enterprise but purpose to buy this share in year 5 if expectations are met.
It is important to mention here that the business plan foresees and return of investment for
these first investors at year 5 in dividends form. It makes that investors will receive its
investment back in five years and still hold its equity share to negotiate with it after 5 years:
Equity Structure
The Star Casino

29%
Sky Casino
51% Looking for Investors
20%
P a g e 125 | 139
There are a few aspects that must be treated in this part. First of them, what return of
investment can be expected by our partners and investors. The Sky Casino compromise is to
have a full return of investment by the fifth year. This means that all the money they put up
front to launch the company will be given back in 5 years moment when they will hold some
percentage of the company as benefit. At this point a contractual exit is being negotiated by
Sky Casino with The Star Casino to offer a fair exit to any other investor in the company for
a fair price of their shares depending on the enterprise financial results.
To be able to give back all the initial investment Sky Casino must do an important financial
effort in dividends form. Typical high return companies give from 60-70% of their net income
in dividends. Having in mid the high investment needed and the risk type of it, Sky Casino
compromises to give up to 80% of their net income in dividends every year with profits,
following the international regulations.
Next it is displayed the dividends policy expected and the cash flows from the investors
point of view.

Equity in Common shares 120.00 million $
Preferred dividends (in million $) 17.00 30.00
Common dividends (in million $) 20.00 25.00 28.00
Total Dividends / Net Income 0% 0% 82% 85% 86%
Total Investor IRR (in 5 years) 0%
Investors Cash Flows (120.00) 20.00 42.00 58.00
Investors Cash Flows

80,00
60,00
40,00
20,00
(20,00) Year 1 Year 2 Year 3 Year 4 Year 5
(40,00)
(60,00)
(80,00)
(100,00)
(120,00)
(140,00)
P a g e 126 | 139
As explained in detail all over this document Sky Casino is a mixed company. Doesn’t acts as
a typical airline but is not just a Casino either. In these lines, what is meant is to compare some
financial performance and ratios of different competitors with Sky Casino expected results
that evidence more this similarities and differences among the competitors. Looking for
enterprises in the environment that can be compared to Sky Casino there has been selected
two. “Quantas” as an airline that operates in Asia and has A380 in their fleet. And “The Star
Casino” from Australia, as a consolidated partner and the dominant player in gaming industry
in Australia.
All data retrieved in this section from the competitors has been extracted from their 2016
public annual reports.
Liquidity
Current Ratio 0.49 0.93 0.37 Current Ratio = Current Assets / Current Liabilities
Efficiency
Asset Tunrover 0.95 0.5 1.17 Asset Turnover = Sales or Revenues / Total Assets
Profitability
Return on Assets 16.01% 4.33% 26.60% Return on Assets = Net Income / Total Assets
Debt Ratio
Leverage Ratio 80.48% 31.49% 83.40% Leverage Ratio = Total Debt / Total Assets
Debt to Equity 1.968 0.339 5.040 Debt to Equity = Total Debt / Total Equity
As it is shown above, each one competitor represents a different industry that is very
influences for different status quo. For example, Qantas and Sky Casino, due to their need
of expensive assets (airplanes) are highly leveraged and need to do the most from their
assets. That is why they have bigger ROA than The Star Casino. On the other hand, as a
services and leisure oriented business, The Star Casino is less leveraged. Retains positive
reserves and a big equity in its balance sheet. That is why they have a debt to equity ratio
lower than the other two.
Finally, the difference that appear between Qantas and Sky Casino, for example on the ROA
having a similar Asset Turnover are rooted in a much more efficient financial company
completely oriented to create Net Income through two revenue inputs instead of just one.
Using the gaming activity to be more efficient than a normal airline.
P a g e 127 | 139
Income Statement in millions euros ('000.000) Balance Sheet in millions euros ('000.000)
Period 1 Year 2 Year 3 Year 4 Year 5 Year Period 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year
Revenues 47.67 123.33 204.85 262.83 296.28 Fixed Assets 5.00 5.00 5.00 5.00 5.00
COGS 6.86 17.16 28.50 36.56 41.22 Leasing Asset 295.56 297.91 302.61 309.49 317.84
Gross Margin 40.81 106.18 176.35 226.26 255.07 Acc. Depreciation 15.28 30.67 46.30 62.28 78.67
Non Current Assets 285.28 272.24 261.30 252.21 244.17
Fixed Costs 132.69 89.30 98.15 107.87 108.80
EBITDA (91.88) 16.88 78.20 118.39 146.27 Inventories 0.38 0.94 1.56 2.00 2.26
Receivables 0.13 0.34 0.56 0.72 0.70
Depreciation 15.28 15.40 15.63 15.97 16.39 Cash 5.15 4.84 5.65 6.26 6.39
EBIT (107.16) 1.48 62.57 102.42 129.88 Current Assets 5.66 6.11 7.77 8.98 9.35
5.7% Interests 1.45 2.34 1.97 1.55 1.14 Total Assets 290.94 278.35 269.07 261.20 253.52
4.5% Leasing Interests 9.58 9.07 8.57 8.06 7.56
EBT (118.19) (9.93) 52.03 92.80 121.18
Common shares 120.00 120.00 120.00 120.00 120.00
30% Taxes (35.46) (2.98) 15.61 27.84 36.35 Other (Reserves, …) (85.35) (119.51) (120.08) (115.51)
16.41% Gaming Taxes 2.62 7.22 11.99 15.38 17.34 Net Income Available (85.35) (14.17) 24.43 32.58 37.48
Net Income (85.35) (14.17) 24.43 49.58 67.48 Equity 34.65 20.49 24.92 32.49 41.98
Less preferred dividends 17.00 30.00 Long Term Debt 22.89 36.92 31.17 24.47 17.97
Net Income Available (85.35) (14.17) 24.43 32.58 37.48
Leasing Liability 212.80 201.60 190.40 179.20 168.00
Short Term Debt 2.54 4.10 3.46 2.72 2.00

Payables 1.69 4.23 7.03 9.02 10.16
Accurals 16.36 11.01 12.10 13.30 13.41
Current Liabilities 20.60 19.34 22.59 25.03 25.57
Total Equity & Liabilities 290.94 278.35 269.07 261.20 253.52
P a g e 128 | 139
Statement of Cash Flow Ratio Analysis
Period 1 Year 2 Year 3 Year 4 Year 5 Year Period 1 Year 2 Year 3 Year 4 Year 5 Year
1. Cash Flow from Operations Liquidity Ratio

Net Income (85.35) (14.17) 24.43 49.58 67.48 Current Ratio 0.27 0.32 0.34 0.36 0.37
Depreciation 15.28 15.40 15.63 15.97 16.39 Acid Ratio 0.26 0.27 0.27 0.28 0.28
OCF (Operative Cash Flow) (70.07) 1.23 40.06 65.55 83.88 Cash Ratio 25.0% 25.0% 25.0% 25.0% 25.0%
- Δ Inventory (0.38) (0.56) (0.62) (0.44) (0.26) Asset Management

- Δ Recivables (0.13) (0.21) (0.22) (0.16) 0.02 Inventory Turnover 18.25 18.25 18.25 18.25 18.25
+ Δ Payables 1.69 2.54 2.80 1.99 1.15 Days of COGS in inventory 20.0 days 20.0 days 20.0 days 20.0 days 20.0 days
+ Δ Accruals 16.36 (5.35) 1.09 1.20 0.11 Recivables Turnover 365.00 365.00 365.00 365.00 423.98
Cash Flow from Operations (52.52) (2.35) 43.10 68.14 84.90 Average Collection Peiord 1.0 days 1.0 days 1.0 days 1.0 days 0.9 days
Payables Turnover 4.06 4.06 4.06 4.06 4.06
2. Cash Flow from Investments (5.00) Days of COGS in payables 90.0 days 90.0 days 90.0 days 90.0 days 90.0 days
Accruals Turnover 8.11 8.11 8.11 8.11 8.11
3. Cash Flow fron Financing Activities Days to pay accruals 45.0 days 45.0 days 45.0 days 45.0 days 45.0 days
Common Shares 120.00 Fixed Assets Turnover 0.17 0.45 0.78 1.04 1.21
Preferred dividends (17.00) (30.00) Total Asset Turnover 0.16 0.44 0.76 1.01 1.17
Common Dividends (20.00) (25.00) (28.00)
Banks 238.23 4.39 (17.59) (18.64) (18.43) Debt Ratios
Cash Flow from Financing Activities 358.23 4.39 (37.59) (60.64) (76.43) Leverage Ratio (Total Debt Ratio) 88.1% 92.6% 90.7% 87.6% 83.4%
Credit Ratio 8.7% 14.7% 12.9% 10.4% 7.9%
Cash Flow 300.71 2.04 5.51 7.50 8.48 Debt to Equity *Liability to Equity 7.40 12.59 9.80 7.04 5.04
Equity Multiplayer 8.40 13.59 10.80 8.04 6.04
Cash at the beggining 300.71 302.75 308.26 315.75 Times Interest Earned (9.72) 0.13 5.94 10.65 14.93
Cash Flow 300.71 2.04 5.51 7.50 8.48 Cash Coverage Ratio (8.33) 1.48 7.42 12.31 16.82
Cash Flow at the end 300.71 302.75 308.26 315.75 324.23
Profitability Ratio
ROE (Return of Equity) -246.3% -69.2% 98.0% 152.6% 160.8%
ROA (Return of Assets) -29.3% -5.1% 9.1% 19.0% 26.6%
Profit Margin -179.0% -11.5% P a g e 129
11.9% | 139 22.8%
18.9%
During this financial plan, there have been spotted some critical factors that could affect the
performance of the whole Sky Casino Company. Some of them are environmental factors, another
are assumptions from market research or just fixed by the competence behaviour. From now on
some of them are going to be tested one by one to find the critical values that could bring to financial
action to reverse a negative tendency.
The failure mode that has been considered is the strictest one because, even though the margins
are going to be tighter, in case of detection of any of these anomalies there is more action margin.
The failure mode consists on a continuous modification of any parameter from year one to five that
creates a bad financial performance that causes equity value equals to 0 in the fifth year. This
circumstance can be easily recovered with a capital increase that injects money in the enterprise via
common shares sell.
Occupation test
An average expected occupation of 95% of the seats in every travel by the fifth year might look
like and optimist assumption. It is not if consider the market share that it means, less than 30% of
the restrictive market of HNWI in the HUB area. This occupation must be met even before the 5th
year. But, what happens if this occupation levels are below the expected ones? In the next graph,
you can see the critical occupation that would need a capital increase in the 5th year for tickets
sold at 1.900USD and also another scenario were tickets are sold at 2.100 USD having in mind
that ticket price is not a critical aspect for the customer targeted.
Occupation Performance Test

100,00%
95,00%
90,00%
80,00% 80,00%
75,00%
70,00%
Critical Occ at
60,00% 2,100 $ per ticket
50,00%
Critical % Occ Flight Expected % Occ Flight Crítical % Occ Flight at 2,100$
As it is noticeable, for 1.900 USD per ticket the critical occupation curve is flatter than the expected
one (against the strong economic effort in marketing that is going to be done) with a minimum of
80% average occupation in the 5th year.
Meanwhile, for 2.100 USD per ticket the critical occupation move down similarly to the one
explained before with a minimum of 75% average occupation for the 5th year.
Ticket price
Another important number from the revenue point of view is the average ticket price. Targeted
customers are not very sensitive to this number but this price is variable from one client to another
following the same pricing structure as any other airline in the market. That’s why average ticket
price might differ from one travel to another and that’s why this analysis has been done.
P a g e 130 | 139
1,900 $
Expected Ticket
Price
1,615 $
$2.000,00
Minimun Price
$1.800,00
$1.600,00
$1.400,00 85% of
$1.200,00 Expected
$1.000,00 Price
$800,00
$600,00
$400,00
$200,00
$-
Tickets Price
The critical Average price that would need cash injection in the 5th year is 1.615 USD average price
per ticket. That would mean a 15% less that the expected price tested in marketing plan here. This
could be considered a safe margin because that price would attract any business traveller for less
than the competence prices instead the HNWI targeted customers.
Gaming revenues per customer

As explained before this is the most critical number all over the expected results of Sky Casino.
There are several studies that can be consulted in the marketing plan that assure that one HNWI
can expend more than 600 USD per hour gaming. These people are the targeted customers but it
cannot be ensured that 100% of the customer will meet this expense and even that customers will
be gaming all the time on board. That’s why a safe 343 USD per hour has been taken for average
gaming expense per hour per customer in gaming activities. Over it, there has been don the next
stress analysis.
600.00 $
Market Research Value
$600,00 342.83 $
$500,00 Expected Value
$400,00 217.86 $
Minimun Value
$300,00
$200,00
36% of Market
Research Value
$100,00
$-
Gaming Revenues/pax/hour
P a g e 131 | 139
As shown above, 218 USD per hour gaming expense in Sky Casino is the minimum value that Sky
Casino Company would hold. Another safe assumption that would mean a 37% reduction from the
expected value and more than 64% reduction from the market researched value of 600 UDS per
hour.
Jet Fuel Price

As any other airline that will have a 40% of their fixed costs compromised in fuel expense a strong
variation of price of fuel per litre can cause enterprise default. The price used for the calculation
has been 1.55 USD / gallon, a little higher from the actual price. But, just in case, there has been a
stress analysis that can be saw next.
2.53 $
Maximun Value
$3,00
$2,50 63% Increase

1.55 $/litre
$2,00
Actual Value
$1,50
$1,00
$0,50
$-
$/fuel gallon
A 63% or higher increase in fuel unitary price would cause a cash injection need in the 5th year. The
maximum continued value that Sky Casino Finances can handle as they are, is 2.53 USD per gallon.
Looking at an evolution over the past 5 years of fuel costs, this is a value that is really critical and
must be continuously monitored to take action in case it is needed.
P a g e 132 | 139
- Every explanation before comes to this point, Sky Casino is actionable. It is not just an idea,
it is a business that can be executed following every law, rule and being compliant with its
accounting duties.
- Sky Casino is a profitable business idea. After 2 years of investment and marketing effort to
promote its product it becomes an enterprise that generates almost 300 Million Dollars and
is able to retain 35 Million Dollar as Net Income Available.
- The strongest expenditures that Sky Casino has are 3. Leasing, Fuel and Marketing. Leasing
and its depreciation causes a lot of expenditure but is needed to run the whole company.
This kind of financial leasing is the most representative alternative to have and profit from
an asset as big as a plane. And the most secure one. Fuel mean the 40% of the fixed costs
of the company and changes in its price may be critical for the profitability of the company,
it must be followed closely. And Marketing represent and strong effort at first that get
diluted over time in order to launch a new product successfully.
- Sky Casino needs 120 Million Dollar of initial investment. But all of it is meant to be given
back in 5 years. That means that any investor will have a return of its investment in 5 years.
At that point, they can keep its investment man make profit from it or choose and exit selling
its company share and profit from there immediately.
- To sum up, a few figures:
Enterprise Value 170.76 million $

Debt
Equity Value 170.76 million $
WACC 5.4%
r 15%
Sky Casino IRR 80%
P a g e 133 | 139
P a g e 134 | 139
Our business strategy in the future after this five year business plan is to grow.
Our Company, although profitable, is not so big in terms of revenue compared with other Airlines
or casinos.
That is inevitable, since we operate only one aircraft in one route, and the casino business takes
place only during these trips. Therefore our maximum possible revenue comes from multiplying the
available seats by the number of flights and the price of the ticket and adding the expected earnings
per game hour multiplied by the number of cruise flight hours.
Those are figures that in our business plan reach a reasonable maximum. We cannot make more
flights, or longer flights, expect to add more seats maintaining the quality or increasing the price
maintaining the market.
Therefore, in order to follow our growth strategy, we have to develop different business
alternatives. Here we find some of the possibilities that could help us in pursuing of our goal.
This is the most immediate way of growth. New routes imply more tickets and more gambling hours,
increasing the revenues in a very important amount.
We need therefore to find another region of interest to our business. Due to the gambling ratio and
the quantity of HNWI, the United States is a very plausible option. We have therefore a triangle of
USA-Sydney-Hong Kong that offers really interesting possibilities.
The negative side of this strategy is the initial investment. We would need to acquire another aircraft
in order to fly two routes as the same time. As a positive view, since it would coincide with the end
of the leasing contract, we could negotiate better prices and conditions when leasing two aircrafts
instead of one.
We are flying between hubs, meaning that if our customers come from regions different than those
of our route they will have waiting time at the airport. As explained in this document, for that we
count on VIP lounges but we could improve our service by having airport casinos.
They would not only be limited to our customers but to the public of the airport, serving as a source
of income, of advertising and of service to our customers.
The investment would be important but not as big as the one needed to prepare new routes.
We would also need to study in depth the legal implications of having the casino on the duty free
area, since it could have very beneficial implications.
Charter flight companies are common, offering private flights to the destination demanded by their
customers, usually big groups with an important net worth.
The idea of this business line is to buy or lease a small aircraft (around 100 seats), making part of it
casino and the remaining space high class seats.
It would offer the possibility of a more customized trip, having flexibilities in schedules and in routes.
Our core would still be part casino, but the other part instead of individual ticket would be the full
charter flight reservation.
P a g e 135 | 139
We would need an important initial investment since the purchase and adaptation of an aircraft,
even a small one, is considerably high.
It is habitual for commercial aircrafts to make use of their extra capacity of their cargo hold to carry
other goods than those of the passage.
The A380 aircraft has a cargo hold enough to carry the baggage of 600 people. Since we are only
carrying 166 passengers, we have a huge extra cargo hold capacity that we could rent to logistic
companies to benefit from it.
The most important matter is that this extra operation will not affect the experience of our true
customers, the passengers, therefore the logistic company would be subdued to this obligation. The
goods would be carried to the aircraft before the passengers arrived, in order not to delay the flight,
and would be taken out after the passengers and their luggage, in order not to delay their
disembarking.
This new line of business has the advantage of not requiring any initial investment and the
disadvantage of being relatively small and complicate the handling.
P a g e 136 | 139
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flights-on-21-city-pairs-from-12-chinese-cities-261773
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Ph.D. Gambling Teaching & Research Center. Macao Polytechnic Institute
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A380 Design Maintenance Manager. Airbus. March 2003
Airbus-FAST55
AIRLINE MAINTENANCE COST EXECUTIVE COMMENTARY. An Exclusive Benchmark Analysis

(FY2014 data) by IATA’s Maintenance Cost Task Force
Carlos Llaneza’s Lecture Notes. Aerospace MBA 2016/2017
Airline Operating Costs. By Peter Horder, Senior Vice President SH&E Ltd. Prepared for:
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International.
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Board. EASA Proposed CM No.: Proposed CM–CS-008 Issue 01 issued 16 September 2015.
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A380 Airport Operations. December 2015. A380 Marketing CWZM. Airbus.
http://www.hongkongairport.com/eng/index.html
https://www.sydneyairport.com/
Australian form of the company:

https://www.business.gov.au/info/plan-and-start/start-your-business/business-structure
Hong Kong form of the company:

https://www.guidemehongkong.com/incorporation/introduction/hong-kong-incorporation-
entity-types
Cost stablishing a company:

http://asic.gov.au/regulatory-resources/forms/forms-folder/201-application-for-registration-as-
an-australian-company/,
http://asic.gov.au/for-business/starting-a-company/minimum-officeholders/#public,
http://www.cr.gov.hk/en/publications/docs/3-e.pdf,
P a g e 138 | 139
Macau gambling legislation:
https://estudogeral.sib.uc.pt/bitstream/10316/14183/1/CASINO%20GAMING%20LAW%20IN%
20MACAU.pdf
Hong Kong gambling legislation:

http://www.hab.gov.hk/en/policy_responsibilities/District_Community_and_Public_Relations/gam
bling.htm
Indonesia gambling legislation:

https://simonsblogpark.com/onlinegambling/simons-guide-gambling-in-indonesia/
PNG gambling legislation:

https://simonsblogpark.com/onlinegambling/simons-gambling-casino-png/
Australian gambling legislation:

http://www.legislation.nsw.gov.au/#/view/act/1992/15
Legal jurisdiction:
“El Derecho Aeronáutico”
Australia taxation:
http://www.austlii.edu.au/au/other/dfat/treaties/1986/31.html
https://en.wikipedia.org/wiki/Taxation_in_Australia#Capital_gains_tax
http://www.treasury.nsw.gov.au/__data/assets/pdf_file/0020/127307/TRP16-
01_Interstate_Comparison_of_Taxes_2015-2016.pdf
https://www.fwc.gov.au/awards-and-agreements/legislation-regulations
https://www.fwc.gov.au/awards-and-agreements/agreements
http://www.australia.gov.au/information-and-services/jobs-and-workplace
https://www.qantas.com/infodetail/about/corporateGovernance/2016DirectorsReport.pdf
https://www.open.edu.au/careers/transport/flight-attendants
https://www.open.edu.au/careers/tourism/croupiers
Cristobal Cantos’ Lecture notes. Aerospace MBA 2016/2017
Qantas Annual Repport 2016
Star Casino Sydney Annual Report 2016
Corporation Act 2001. Australian Account Law.
Corporate Regulations 2001. Australian Account Law
Australian Standards Board. A.A.S.B.
P a g e 139 | 139

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David Alarcia Pérez

Manuel Candón Estudillo

Gonzalo Jiménez Mozo

OPPORTUNITIES AND THREATS: 20

LEGAL FORM OF THE COMPANY 94

HUMAN RESOURCES PLAN 104

HUMAN RESOURCES STRATEGY 105

FINANCIAL PLAN 117

FINANCIAL STATEMENTS ANALYSIS 118

GLANCE INTO THE FUTURE… 134

NEW ROUTES 135

EXTERNAL & 5 PORTER’S FORCES 137

“To become the airline , creating a new market in

new market, becoming a

Ilustration 1: Qantas A330-300

Ilustration 2: Qantas A330-200 layout A

Ilustration 3: Qantas A330-200 layout B

The huge capacity of this aircraft allows a 4-class service.

Ilustration 5: Qantas A380-800

China Southern Airlines:

Ilustration 6: China southern airline A330-200 A

Ilustration 7: China southern airline A330-200 B

 A320: Three classes, mostly economy.

Ilustration 8: China southern airline A320

Ilustration 9: China southern airline A321

Ilustration 10: China southern airline A380

Ticket prices are very similar to those offered by Qantas.

Let’s continue studying the different casinos in the city.

Ambitious Project, still in construction. It is a 270

Its opening, which has already suffered delays, is

Its architecture aims to become the new icon of the

 The star casino:

It is our main investor and shareholder, so it is a partner

The Star features two gaming floors, eight bars, seven

In Hong Kong there is no competition in the area of land based casinos.

Chinese & Australian High income level people

Airbus, Boeing, Mcdonnell Douglas, Lookheed Martin, Northop Grumman, Bombardier,

Pitch/Width 80"/29.5" 73"/20"

- Air Canada Technical Services - Iberia Maintenance

It offers absolute flexibility of Schedule, aircraft type, destinations, origins, etc.

Cruise Ship Casinos

The Rex Fortune

The minimum buy-in at the standard tables is HK$500 (about US$65)

Royal Caribbean ships

Excellent Customer Service

Lack of Knowledge in Gaming Business

Irregular Income Stream

High Fixed Costs. A380 Maintenance and Operation.

- Nearby MRO Suppliers

- Gaming banned in mainland China

- Pioneer and innovative service

- Lack of knowledge in gaming business

- Strong gaming culture in China and Australia

- Gaming banned in mainland China

- Pioneer and innovative service

- Lack of networking in the area or market

Correct. Reorientation strategies

Adapt. Survival Strategies

Maintain. Defence Strategies

Explore. Attack Strategies

- Strong Branding Knowledge. Again, a pioneer service with an environment eager to

A systematic process will applied to take that business idea

Firstly, a market research is performed where the most

Once we have the wishes of the target Customer, the