Yongin Farmland, opened in 1976, was the first amusement park in Korea, managed by Joong-Ang Company, subordinates of Samsung. The 3700-acre attractive force began as an agricultural centre to show how cragged land could be used fruitfully for turning nutrient merchandise.
Yongin Farmland opened a Motor-Park in late 1993 but loss in the first twelvemonth.
Samsung want to better the client satisfaction degree at Farmland, and develop the programs for Farmland ‘s enlargement.
Should Samsung put in such an aggressive enlargement program for Farmland? Is the subject park industry was an attractive industry for investing?
We will get down this treatment to analyse the subject park industry utilizing Porter ‘s 5 Forces:
Since globalisation, and besides subject park visitants besides come from other state, foreign Theme Park has besides be the rival for Farmland.
There are so many large participant in the universe, North America with Walt Disney company is the largest ( gross in 1988 grew from $ 2.042 B to $ 3.4 B. There are besides Time Warner ‘s Six Flags, Paramount.
Europe has Alton Towers UK, Walt Disney, Parc Asterix and Big Bang Schtroumpf in Franc.
Walt Disney section: there marks of worsening profitableness in the U.S. operations, since the market was maturating and the competition was acquiring more intense. But Tokyo Disneyland, the Nipponese operation, was turning and profitable.
Tokyo Disneyland and Tokyo Disney Sea, Ocean Park in Hongkong, Jaya Ancol Dreamland with Dunia Fantasi in Jakarta. China has Beijing Amusement park, with 2,000 per cent increasing revebue between 1990 and 1993.
Lotte World, started in 1989, the universe ‘s largest indoor subject park with bordering hotel, dept shop, shopping promenade, folk small town and athletics Centre.
Seoul Land, located near Seoul at Kyungkido, ranked 23rd in the “ Top 50 subject Parkss worldwide ”
A figure of subject park were puting to a great extent in upgrading installations and widening subject Parkss ‘ services. Periodically added new attractive forces or renovated bing 1s to pull repetition clients.
Leading subject park companies, such as Walt Disney Company, charged immense licensing fees. They were really selective in taking joint ventures in other state.
In this industry, its hard to differentiation, other can copy.
The competition is high intense. Menace from internal competition is HIGH.
Theme park industry required a large-scale investing ; normally required over 50 estates of land and cost could be really high, $ 50 M up to $ 3 B ( this take 50 % of investing ) . It ‘s besides need amusement machinery ( 20-30 per cent of investing ) and working capital demands took the remainder.
Sporadically necessitate add-on new attractive forces or renovated bing 1s to pull repetition clients i? more investing.
This industry need economic of graduated table of higher net income.
This industry has a high issue cost since high investing.
Need high degree of particular cognition.
Government ordinances were rather rigorous because of the extended land usage, and the potency for serious accident. A typical period required for set uping authorities for a subject park could be every bit high as two to five old ages ( depending on the state )
We can state, the entry barrier is rather high, so the menace from new entryway is rather low.
The purchasers are households, immature grownups, corporate groups and tourers.
Tour operators and authorities tourer publicity boards besides a purchaser.
Most of them merely come to theme park in the peculiar season.
Customer satisfaction is their demand to pull a repeat, but there are so many participants, and the purchaser is really easy to exchange. No demand cost to exchange to other subject park, the client ever necessitate a new experience.
Menace from purchaser is HIGH.
There were fewer than 10 providers who were capable of developing choice machinery, such as DOGO of Japan, HUSS of Germany, and ARROW of the US. They are worked globally ; the industry can inquire a usage designed.
There were a big figure of providers for the smaller machines, could be manufactured domestically.
Sega Japan and Simex Canada is for particular stimulators for amusement.
Those providers are viing each other, can fabricate domestically and it ‘s a advantage for industry, so menace from Supplier is LOW.
There is exclusion for “ package ” ; sometimes, “ package ” in the industry was non easy available. In this instance, Farmland will travel it entirely.
Substitutes and Complements
Consumer can replace a visit to theme park with other manners of amusement, something new, different, cheaper, or more convenient such as free admittance Parkss and beaches, bivouacing trips, picture films at place. No exchanging cost.
Menace from replacement is medium to high, since really the replacement is non in the same comparative with subject park industry.
Government ordinances were rather rigorous because of the extended land usage, and the potency for serious accident.
Booming Korean economic system
Increasing demands for leisure attractive forces.
Customer satisfaction was a critical issue i? to pull repetition clients
Particular stimulators for amusement intent utilizing proprietary engineering.
Software, need a high licensing fees.
Virtual Reality ( VR ) was progressively going a extremely moneymaking mas-market amusement phenomenon.
The traditional entreaties are preteens, teens, and immature grownups. But altering demographics push to believe in term of broader market, peculiarly households, corporate groups and senior citizens. There 5 major markets:
Local household, largely on weekend
Children ‘s group ( school, churches, lookout ) , summer weekdays
The eventide market, teens and immature grownups, comes from concert and romancing at dark
Farmland had the highest growing rate within Korean industry
SAMSUNG image is a large company.
Maestro program includes some new park and new installations, will go on with luxury hotels, golf classs, will give a high category resort.
Mountain resort gives a “ fresh ” intension.
Farmland is 60 kilometer from Seoul, during peak hours, it took every bit long as 2 hours to drive
Farmland have more or less adequate parking for the clip being, but if we are traveling to spread out, this will be a major constriction
our client satisfaction degrees were dawdling behind the cardinal rival, Lotte World
The authorities has programs to convey the metro up to Yongin, Farmland would hold a subway terminal i? a batch of convenience to our client
Since we will construct some new substructure, like a H2O park, we can put on the newest amusement engineering that can be a new challenge to the client.
Walt Disney Corp. were non interested for joint venture with in Korea. Farmland had to travel it entirely to supply “ package ” for subject park
Korean nature, work 5 A? yearss a hebdomad, working yearss the travel clip is long. They will non be so acute to go on a Sunday or on vacation if the traffic is heavy.
Expanding Farmland will take over more of the land mass available in the Yongin vale. Potential implosion therapy.
YES, Samsung invest in such an aggressive enlargement program for Farmland.
We need to make many things in our scheme in order to do this as a profitable industry.
Harmonizing to spread outing Farmland, we have to see how we compensate the people around there since possible implosion therapy in the encompassing part. If there is non compensation, there will be a possible menace to our company.
Handiness of the park location is a cardinal success factor in subject park industry, so we need to do a good relationship with authorities harmonizing to authorities program to convey the metro up to Yongin.
About pricing, we will exchange to Pay-one-price strategy.
We have to increase our client satisfaction degrees. We besides need to alter the Farmland name with other name to supply a better image of the company that can pull people with something different experience. Once they come to theme park, we will supply a high quality experience to pull repetition clients. Repeat concern is really of import to our endurance. If we do n’t fulfill our clients, they will non come back and we will non hold any concern left.
We have to make something that can be our typical. With our maestro program, Farmland will be the South Korea ‘s largest subject park. With new investing, we can put on the newest amusement machinery engineering that can be a new challenge to the client.
We need to construct a corporate image, to do Farmland as a universe category resort composite.
We will construct our caput office located where our merchandises are, non pull off Farmland by distant control.
About enlisting, we need more service oriented people, more female workers, even we will confront a high turnover, it will good since fresh blood ever brings in fresh thoughts so we would able to continue some dynamism in our organisation.
What we want to construct is a finish resort town and residential community where people can come, loosen up and bask themselves in a low-stress environment. For 180,00 Samsung employee, this will give a topographic point to come and be proud of. This can convey a good spirit to all Samsung employee.