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Lusail City Quarterly Report Sales & CRM (Q2 2011)

Lusail City Quarterly Report Sales & CRM (Q2 2011). Executive Summary & Recommendation. Executive Summary

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Lusail City Quarterly Report Sales & CRM (Q2 2011)

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  1. Lusail City Quarterly ReportSales & CRM (Q2 2011)

  2. Executive Summary & Recommendation Executive Summary Identifying the positioning strategy and the target market who will eventually reside in Lusail City, are the primary objectives that LREDC should consider. Other sales objectives include providing incentives to restart the sales process, and enticing the current sub-developers to commence building their plots. The Sales & Marketing strategies are to concentrate on both macro and micro levels so that sales and development activities commence, and the overall vision of the development to come to life. Customer relationship management will require a major initiative by LREDC to engage assertively across all fronts, and interlink all customer related activities in the best possible way. Accuracy in data will play an integral part in the success of the development and allows LREDC to gain maximum control towards current and future investors. • Recommendation • Update purchasers of infrastructure progress and provide anticipated hand-over dates. • Review legal obligations towards sub developers in order to comply with signed SPA in terms of payment and handover. • Coordinate with all purchasers to update their profile within the Master sales Database to serve multiple purposes for LREDC. • Develop a Customer Relationship Management system where sales, marketing, customer service, and sales administration can • easily and effectively integrate. • Identify the delinquencies available at current stage and implement levels of action towards those delinquent. • Provide clarification on Snap analysis report provided on specific cases. • Initiate the involvement of Tanween within the implantation of the Oracle ERP system. 59

  3. 6 Sales & CRM • 0.1 Sales • 1.1 CRM

  4. 0.1 Sales Sales strategy to focus on rebuilding trust with existing purchasers and restarting the stalled sales process • Sales overview • Key sales initiatives need to be undertaken and directly targeted, in order for LREDC to both restart the stalled sales process, and entice the current sub-developers to commence building their plots. The strategy should have the ability of re-instating the overall objective of the project and its opportunity towards the future growth of Qatar. Both sub-developers and end users are to be targeted hand in hand to bring the overall objective together: • Due Diligence • Identify future investors and sub-developers by verifying their financial ability through existing purchases. • Identify possible retained plots for re-sales • Using the due diligence exercise outcome, to find ways to minimize speculators from future sales activities. • Highlight the importance and risk that speculators pose to the development progress and inflation of price. • Identify speculators from true developers • Financial Incentives • Provide larger grace periods, by comparing current status. • Coordinate with financial institutions to provide necessary funding to specific low risk plots. • Sign MOU’s with local banks that can provide developer financing and end user mortgage plans. • Legal Review • Clarify end user rights when purchasing property (i.e. Title deed registration, resident permit guidelines, service charges, mortgage rates & duration etc.) • Freehold vs. 99 year usufruct strategy on existing or retained plots. • Introduce freehold titles for parts of the retained plots. • Target Audience • Identifying the target market from an end user perspective. (What the primary end user searches for within a development) • Identify regional competition from an end user perspective. • Targeting and communicating end users and their affect on the overall project success. Lusail City Sales Update Map 59

  5. 0.2 Sales Sold /Unsold district comparison of Lusail City Sales Overview Updates: A total of 18 districts have been identified in the version 8 master plan submitted by LREDC. The table below is an identification of the districts that have been sold either by individual plots or as a whole district. In two separate cases of district sales; it is important to identify that North Residential Villas & Waterfront Residential Villas have been sold to one investor as one district and in another case Al Erkyah, Educational and Medical District has split into two districts. Furthermore 3 districts have been updated with new names North Residential Villas & Waterfront Residential Villas is now Al Ijahra, Al Erkyah is now Al Jawhara Greens and Seef Commercial is now Seef Lusail. Districts as per Version 8 Master Plan Current District Overview 59

  6. 0.3 Sales Lusail Sales Activity • Sales activity by district • The graph below is the breakdown of the sales activity that took place between the years 2005 up until 2009.The sudden decline in the sales activity was primarily due to the world recession and the slow down of sales activity. Approximately 35% of Lusail city is available for sale and would require a comprehensive sales strategy once LREDC identify if they are to retain, lease and or sell. Further the graph indicates the high volume of purchases that occurred for the Marina, Fox Hills and Waterfront districts in 2006-2007. Part of the sales strategy is to understand the objectives of the current investors and classify them into categories that help associate risk: • Developers • Distressed Developers • High Net worth Investors • Speculators Peak Sales Period 2006 - 2007 59

  7. 0.4 Sales Lusail City Delinquencies • The PDC delinquency identifies, that the post dated cheques available and the PDC not available for all over due payments. • There are a few cases where the PDC is not available, in some cases this posses a substantial amount of risk. • Overdue payments along with no PDC’s are of a high level of risk and should be addressed at an early stage. • The above chart indicates the amount cleared, Not due and delinquent in Lusail City. • Delinquent payments to LREDC represent a substantial proportion and must be viewed as a key risk to the developments success. • The Due / overdue report provides an indicative percentage with regards to returned cheques (Bounced) and over due payments of 2 and above and 1 overdue payments. • The risk factor of each plot will be identified once the Due Diligence exercise is complete. Tanween will identify the individuals associated to each plot along with a risk profile. 59

  8. 0.5 Sales Lusail City Target Audience Project positioning & Sales drivers As shown in the market research section, it is clear that the population of Qatar is expected to grow in the years to come. As mentioned in the sales overview section above, we believe that LREDC will be required to take a bold decision which would need to indicate the primary occupier in Lusail City. Occupiers are the essence of any major development, they in turn create substantial demand towards Lusail if targeting correctly. Demand from an end user perspective in itself could be a major driver that would entice current sub-developers to commence building. Tanween initially has identified the target audience into a primary market. • Target Audience • Resident expats in Qatar who have been residing in the country for a very long time and are now seeking residency freedom through buying an affordable unit. • Resident Expats who have missed out on buying when the Pearl Qatar was offered in 2004. • International Expatriates who have seen the growth and appreciation trends in Dubai and believe such a concept to once again occur in Qatar. • Local Qataris who view Lusail City as a future community they would like to be part of, by purchasing a second home or weekend getaway destination. 59

  9. 1.1 CRM Customer Relationship Management (CRM) strategy & overview of Master Sales Database The master sales database created by Tanween provides detailed information on Sale and Purchase Agreements (SPA’s) signed between investors and LREDC. The database captures all the contact details, payment details, plot specifications of individual buyers. The master database will serve on many fronts for both LREDC and Tanween, it will become a core base of implementing an effective CRM strategy and applying it to a system such as an Enterprise Resource Planning system (ERP). The information becomes vital to such systems, so that it is able to provide accurate reports to management on the current status and communicate effectively with their investors for multiple purposes. • Tanween have been able to identify a total of 346 different investors, that have purchased single plots, multiple plots and complete districts. The investors range from corporate ,individual and joint investors or in some cases a mix of each. The investors also range in nationality , the chart identifies the percentage of nationality that have purchased in Lusail city. It will become integral for LREDC to communicate with their purchaser on various aspects such as: • Follow up on payments • Gain report on investor developer progress. • Ensuring receipt of accurate communication from LREDC to their clients • Sales and Marketing update that Improves structure of existing sales processes. • Provides sales staff better support tools and manages marketing campaigns with clearer goals. (Development Progress, Events, Campaign etc.) • Provides employees with the information they need to better serve LREDC’s clients/ Purchaser/Future developers. Qatari 39% 59

  10. 1.2 CRM Snap Analysis of Master Database The snap analysis report provides detailed information obtained from the purchasers master database highlighting missing information, missing SPA ‘s and required clarifications. Tanween recommends to engage with LREDC and advise on methods to capture the concerned information. Gathering vital information would serve investors and LREDC to stay connected and up to date on all fronts for the success of the development and the accuracy of the data. 59

  11. 1.3 CRM Area Variation of signed SPA’s Variation report Tanween has received the version 8 master plan from Lusail Administration Complex (LAC), identifying the latest district information. The master database consolidates all the relevant information on the plot size as per the signed SPA. The variation report currently, should only be an indication since it is during the hand-over that the calculation is final. It is highly important to gain insight into the matter, so that LREDC is aware of any legal or financial implications that will arise. The report also could be linked to the due diligence exercise, that would help identify which plots are highly varied and to which investor it belongs to. Tanween has created an extensive plot by plot variation report and summarized the findings into a district overview. Key Risk: A review of the signed SPAs suggests that LREDC would be subjected to reimburse the clients on a negative variation outcome at the handover stage . As per clause 4.3 in the SPA, “the purchase price shall be adjusted proportionately in the event the plot is varied.” 59

  12. Manage Market Procure Sell Projects Follow-up HR Customers Suppliers Products Finance Collect Maintain Data Legal Report Service Implement 1.4 CRM Enterprise Resource Planning Overview Both Tanween and LREDCs’ participation in the migration process from Amlaki to the new Oracle ERP system, is crucially important and should be done at the earliest possible stage. Data verification before the migration should commence prior to any usage of the CRM package within the ERP. Along with LREDC, Tanweens’ involvement in the implementation of the ERP system is integral, so that it is able to advise LREDC on the functionality and best method of usage. • The advantages of the new ERP system: • Improves the productivity of process and personnel. • Increases organizational transparency and responsibility. • Facilitates Strategic Planning. • Improves customer relationship communication. • Uniform reporting structure. • Automates departmental process and Procedures. • Accurate and faster access to data for timely decision. SALES Enterprise Resource Planning Quality customer data is the fuel to the CRM and Sales engine : Comprehensive and accurate customer data is the fuel of the CRM and Sales engine. The accuracy of the customer master database is critical in establishing an effective CRM system. It is highly recommended to have the master database with all investors’ details being accurate in order to develop and maintain an efficient process of integration to the new ERP System. The system can then be used by sales, marketing and customer service automation departments. 59

  13. 1.5 CRM Oracle Sales Solution Below is a typical Oracle sales solution that would be embedded into the CRM system of the ERP package. LREDC would be required to modify such package or customize its usage depending on both Tanween and LREDC’s analysis and recommendation. Adapting to the package is also likely and would require a review by both LREDC and Tanween for that its usage is optimized. InternalDepartments Sales Channels Sales PurchasersDatabase Complete and Accurate Information Customer Service Field Sales Follow-up / Monitor Performance Qualify, Price, Check Availability Quote & Propose Automate SPA & Order Capture& Qualify Lead Legal Tele Sales • Sales Tools • Administration • Customer Service • Campaigns • Connected Users • Integration of departments in LREDC • Sales & Marketing automation • Sales Channel Dashboard • Internal & External reports • Database control Finance Web Sales • Disconnected Field Users • Remote access • Web based system • Accounts • Sales Administration • Payment Collection • Performance Management • Key Performance Indicators (KPI) • Manage targets Marketing Supply Chain Mobility Analytics Partners Productivity 59

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