Executive Summary
The project "Riad of Authentic Moroccan Cuisine" project: establishing a tourist guesthouse (riad) in Marrakech or Fes, focusing on offering a comprehensive and immersive tourist experience centered around traditional Moroccan culinary art. This includes in the tourism and hospitality sector in Morocco targets a promising market opportunity. With an investment of ٢٬٥٠٠٬٠٠٠ MAD, it achieves a Net Present Value (NPV) of -١٬٠٠٧٬٧٤٩ MAD, an Internal Rate of Return (IRR) of -٣٪, and a payback period of — years.
| Indicator | Value |
|---|---|
| Initial Investment | ٢٬٥٠٠٬٠٠٠ MAD |
| First Year Revenue | ٣٬٧٥٠٬٠٠٠ MAD |
| Annual Growth (CAGR) | ١٠٪ |
| Net Margin (Y1) | -٣٪ |
| Return on Investment (Avg.) | -٢٪ annually |
| Net Present Value (NPV) | -١٬٠٠٧٬٧٤٩ MAD |
| Internal Rate of Return (IRR) | -٣٪ |
| Profitability Index (PI) | ١ |
| Payback Period | — |
| Break-even Year | — |
| Expected NPV (Probability-Weighted) | -٩٥٧٬١٥٤ MAD |
Assumptions and Basis
The figures in this study are based on project data, the nature of the tourism and hospitality sector in Morocco, and local market indicators, according to the following assumptions:
| Assumption | Value |
|---|---|
| Initial Capital | ٢٬٥٠٠٬٠٠٠ MAD |
| First Year Revenue | ٣٬٧٥٠٬٠٠٠ MAD |
| Annual Growth | ١٠٪ |
| Cost of Goods Sold (COGS) | ٤٠٪ of Revenue |
| Operating Expenses | ٥٠٪ of Revenue |
| Tax/Zakat | ١٠٪ |
| Discount Rate (WACC) | ١٥٪ |
| Study Horizon | ٥ years |
Basis of Assumptions: Figures based on averages for the tourism sector in Morocco
Project and Opportunity Description
The project aims to offer a unique tourist experience centered around traditional Moroccan culinary art. The goal is to attract foreign and local tourists interested in Moroccan culture.
Market and Demand Study
The target market consists of foreign and local tourists seeking unique cultural and tourism experiences.
Market Sizing (TAM / SAM / SOM)
Market sizing was conducted using tourism market data in Morocco, focusing on the demand for unique cultural and tourism experiences.
| Level | Annual Size | Description |
|---|---|---|
| TAM — Total Addressable Market | 100.0 million MAD | Total serviceable demand |
| SAM — Serviceable Available Market | 20.0 million MAD | The portion your model can reach |
| SOM — Serviceable Obtainable Market | 5.0 million MAD | Your realistic early share |
Sizing Basis: Analysis of the tourism market in Morocco
Unit Economics
Measures the profitability of each sales unit/customer — the most accurate feasibility indicator:
| Unit Indicator | Value |
|---|---|
| Sales Unit | Customer |
| Average Price/Revenue per Unit | ٥٠٠ MAD |
| Customer Acquisition Cost (CAC) | ٢٠٠ MAD |
| Customer Lifetime Value (LTV) | ١٬٥٠٠ MAD |
| LTV/CAC Ratio | ٧٫٥× (Healthy) |
| Contribution Margin | ٣٠٪ |
Competitive Analysis
Key competitors are hotels and traditional riads in Morocco. The project's sustainable advantage is offering a comprehensive and immersive tourist experience centered around traditional Moroccan culinary art.
Market Entry Plan and Pricing
The market entry and marketing plan includes using social media and collaborating with travel agencies and tourism websites.
Capacity and Operations
The project's accommodation capacity is 20 rooms, with an expected occupancy rate of 70% in the first year.
Daily operations will be managed by a team of professionals in tourism and hospitality.
The location will be chosen in Marrakech or Fes, focusing on providing a unique and comfortable tourist experience.
Projected Income Statement (5 Years)
| Item \ Year | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|
| Revenues | ٣٬٧٥٠٬٠٠٠ MAD | ٤٬١٢٥٬٠٠٠ MAD | ٤٬٥٣٧٬٥٠٠ MAD | ٤٬٩٩١٬٢٥٠ MAD | ٥٬٤٩٠٬٣٧٥ MAD |
| Cost of Sales | (١٬٥٠٠٬٠٠٠ MAD) | (١٬٦٥٠٬٠٠٠ MAD) | (١٬٨١٥٬٠٠٠ MAD) | (١٬٩٩٦٬٥٠٠ MAD) | (٢٬١٩٦٬١٥٠ MAD) |
| Gross Profit | ٢٬٢٥٠٬٠٠٠ MAD | ٢٬٤٧٥٬٠٠٠ MAD | ٢٬٧٢٢٬٥٠٠ MAD | ٢٬٩٩٤٬٧٥٠ MAD | ٣٬٢٩٤٬٢٢٥ MAD |
| Operating Expenses | (١٬٨٧٥٬٠٠٠ MAD) | (٢٬٠٦٢٬٥٠٠ MAD) | (٢٬٢٦٨٬٧٥٠ MAD) | (٢٬٤٩٥٬٦٢٥ MAD) | (٢٬٧٤٥٬١٨٨ MAD) |
| EBITDA | ٣٧٥٬٠٠٠ MAD | ٤١٢٬٥٠٠ MAD | ٤٥٣٬٧٥٠ MAD | ٤٩٩٬١٢٥ MAD | ٥٤٩٬٠٣٨ MAD |
| Tax | (٠ MAD) | (٠ MAD) | (٠ MAD) | (٠ MAD) | (٤٬٩٠٤ MAD) |
| Net Profit | -١٢٥٬٠٠٠ MAD | -٨٧٬٥٠٠ MAD | -٤٦٬٢٥٠ MAD | -٨٧٥ MAD | ٤٤٬١٣٤ MAD |
| Net Margin | -٣٪ | -٢٪ | -١٪ | -٠٪ | ١٪ |
Investment Cost Structure
| Item | Cost | Percentage |
|---|---|---|
| Construction Cost | ٧٥٠٬٠٠٠ MAD | ٣٠٪ |
| Operating Cost | ٦٢٥٬٠٠٠ MAD | ٢٥٪ |
| Marketing Cost | ٥٠٠٬٠٠٠ MAD | ٢٠٪ |
| Staff Cost | ٣٧٥٬٠٠٠ MAD | ١٥٪ |
| Equipment and Machinery Cost | ٢٥٠٬٠٠٠ MAD | ١٠٪ |
Cash Flow and Break-even Point
| Year | Operating Cash Flow | Cumulative Cash Flow |
|---|---|---|
| Year 1 | ٣٧٥٬٠٠٠ MAD | -٢٬١٢٥٬٠٠٠ MAD |
| Year 2 | ٤١٢٬٥٠٠ MAD | -١٬٧١٢٬٥٠٠ MAD |
| Year 3 | ٤٥٣٬٧٥٠ MAD | -١٬٢٥٨٬٧٥٠ MAD |
| Year 4 | ٤٩٩٬١٢٥ MAD | -٧٥٩٬٦٢٥ MAD |
| Year 5 | ٥٤٤٬١٣٤ MAD | -٢١٥٬٤٩١ MAD |
Estimated break-even point at annual revenue ≈ ٣٬٩٥٨٬٣٣٣ MAD (~١٠٦٪ of first-year revenue), with a ٦٠٪ contribution margin. Cumulative cash break-even is beyond the study horizon.
Funding Structure
| Funding Source | Percentage | Amount |
|---|---|---|
| Equity | ٦٠٪ | ١٬٥٠٠٬٠٠٠ MAD |
| Debt Funding (٨٪ interest) | ٤٠٪ | ١٬٠٠٠٬٠٠٠ MAD |
Sensitivity Analysis (Revenue × Operating Costs)
Impact of simultaneous changes in revenue and costs on Net Present Value:
| Revenue \ Operating Costs | −10٪ | −5٪ | Base | +5٪ | +10٪ |
|---|---|---|---|---|---|
| −20٪ | -١٨٠٬٠٤٠ MAD | -٧٢٢٬٨٥٤ MAD | -١٬٣٠٤٬٢٤٩ MAD | -١٬٩٠٢٬١٢٤ MAD | -٢٬٥٠٠٬٠٠٠ MAD |
| −10٪ | ٨٩٬٠٠٤ MAD | -٥١٦٬٣٤٥ MAD | -١٬١٥٤٬٧٨٠ MAD | -١٬٨٢٧٬٣٩٠ MAD | -٢٬٥٠٠٬٠٠٠ MAD |
| Base | ٣٥٨٬٠٤٨ MAD | -٣١٤٬٥٦٢ MAD | -١٬٠٠٧٬٧٤٩ MAD | -١٬٧٥٢٬٦٥٥ MAD | -٢٬٥٠٠٬٠٠٠ MAD |
| +10٪ | ٦٢٧٬٠٩٢ MAD | -١١٢٬٧٧٩ MAD | -٨٦٣٬٨١٣ MAD | -١٬٦٧٧٬٩٢١ MAD | -٢٬٥٠٠٬٠٠٠ MAD |
| +20٪ | ٨٩٦٬١٣٦ MAD | ٨٩٬٠٠٤ MAD | -٧٢٢٬٨٥٤ MAD | -١٬٦٠٣٬١٨٦ MAD | -٢٬٥٠٠٬٠٠٠ MAD |
Scenario Analysis
| Scenario | Probability | NPV | Assessment |
|---|---|---|---|
| Pessimistic | ٢٥٪ | -١٬٩٠٢٬١٢٤ MAD | Unfeasible |
| Base | ٥٠٪ | -١٬٠٠٧٬٧٤٩ MAD | Unfeasible |
| Optimistic | ٢٥٪ | ٨٩٬٠٠٤ MAD | Feasible |
Expected Present Value (Weighted): -٩٥٧٬١٥٤ MAD.
Risk Analysis and Management
| Risk | Probability | Impact | Mitigation |
|---|---|---|---|
| Risk of insufficient demand | Low | High | Develop an effective marketing plan |
| Risk of economic changes | Medium | High | Develop a flexible financial plan |
| Risk of insufficient resources | Low | Medium | Develop an effective resource management plan |
| Risk of environmental impact | Low | Medium | Develop a plan to reduce environmental impact |
Organizational Structure and Team
The organizational structure will include a General Manager, a Marketing Manager, and an Operations Manager.
Legal and Regulatory Aspects
Licenses and compliance will be obtained from local authorities.
Expansion and Sustainability Plan
Expansion will be achieved by increasing the project's accommodation capacity and offering additional services.
Environmental, Social, and Governance (ESG) Impact
The environmental impact will be identified and reduced through the use of environmentally friendly technologies.
Conclusions and Recommendations
The conclusion is that the project is considered a good investment opportunity in Morocco's tourism sector.
Frequently Asked Questions
How much does it cost to establish a Riad in Morocco?
2500000 MAD
How much does a Riad in Morocco earn per year?
3750000 MAD
What are the licenses required to establish a Riad in Morocco?
Local authorities' licenses
Is a Riad project profitable in Morocco?
Yes, with an effective marketing plan
How many rooms are there in a Riad in Morocco?
20 rooms
What is the expected occupancy rate for a Riad in Morocco?
70%
Sources and Disclaimer
- Study of the tourism market in Morocco
- Report on investment opportunities in the tourism sector in Morocco
- Study on the impact of tourism on the Moroccan economy
Disclaimer: This is a guiding study that provides financial analysis according to approved industry standards; verify figures locally according to your project's reality before any investment decision.
