Executive Summary

Wellness tourism is a growing industry in the world. Sri Lanka also has huge potential to enhance tourism industry by exploiting wellness tourism. The objective of this study is to develop project development plan for wellness retreat. The primary aim of this study to assess the financial, market, industrial and operational feasibility of establishing a wellness retreat project in Sri Lanka. A proposed wellness retreat is planned to locate in Ella, which is one of favorite destination of any tourist visits Sri Lanka. This wellness retreat is planning to offer six different wellness retreats which are detox retreat, yoga retreat, Ayurveda retreat, emotional healings, stress management and mindfulness. In this study, it is identified the findings of many different researches that prove the product feasibility. According to the research conducted with the participation of tourists visited Sri Lanka, 34% of tourists have engaged with spa experience (Fonseka & Kottage, 2021). 29% of tourists have engaged with yoga and meditation session while 10% of them have involved with stress management retreats.
The unique selling point of proposed wellness retreat consists of four main elements, affordable luxury, customized wellness retreats, collaborate with ancient wisdom and eco consciousness. Thus, business strategy is that providing quality products and services for affordable prices. In accordance with business strategy, wellness retreat mainly expects to target two customer segments; mid budget travelers and luxury travelers. These segments include travelers who spend more than $150 per day averagely in Sri Lanka. The mid budget travelers are the primary customer segment and the luxury travelers are the secondary customer segment. Both primary and secondary wellness travelers are come under the targeted customer segments. The proposed wellness retreat should follow competitor oriented pricing strategies. Competitive bid pricing strategy is the most suitable pricing strategy for proposed business.
In the literature review, it is identified that the estimated annual number of wellness tourism trips to Sri Lanka is 618,000 and the average spend of wellness tourist is $1160 in Sri Lanka. Market feasibility, industry feasibility and organizational feasibility have been comprehensively analyzed in this business plan. Canvas business model has been used evaluate the key components of the business.
The vision of the proposed wellness retreat is that To be the leading destination for affordable and transformative wellness experiences, seamlessly blending traditional wisdom with modern comforts, providing a sanctuary for self-discovery and holistic well-being amidst contributing sustainable development of Sri Lanka. The mission is to provide an affordable, harmonious retreat that combines modern wellness techniques, traditional healing methods, and Sri Lanka's rich cultural diversity. The company want to enable people to set out on a path of self-discovery by providing opulent yet affordable lodging and individualized activities that promote a long-lasting sense of harmony, rejuvenation, and connection with the mind, body, and spirit.
It is estimated that total capital requirement for the project is as Rs 18,000,000. It is planed to fund 67% of capital from debt financing and 33% of capital from equity financing. According to revenue forecast, it is expected to achieve Rs 35,200,000 revenue within the first year. The expected net profit after tax for the first year of operation would be Rs 3,455,000. When analyzing the sensitivity of the business’s operations towards the profitability of the 3 years, it could be clearly identified that the main impact may come with reduced revenue, rather than increased costs. Thus, the business should always focus on retaining the customers by providing the best quality service to them. Breakeven point of the proposed business project in units approximately is 1073 guests. In value, breakeven point is Rs 18,777,500.
Thus, considering the product feasibility, market feasibility, industry feasibility, organizational feasibility and financial feasibility, wellness reteat project is viable. In this study, it is further analyzed the human resource requirements, value chain and associate risks and risk mitigation action plans.

1.0 Introduction
1.1 Background of the study
Tourism and leisure is one of the prominent service industries in Sri Lanka, and it is the third highest foreign income generator in the country (BOI Sri Lanka, 2023). Sri Lanka is blessed with its rich cultural heritage and natural endowment, and Sri Lanka is well known for its warm hospitality. The tourism and leisure sector is a significant economic driver of the country, accounting for 5% of the GDP of Sri Lanka (Central Bank of Sri Lanka, 2023). In 2018, the annual tourism arrivals in Sri Lanka were recorded at 2.5 million, which generated $4 billion in revenue (Central Bank of Sri Lanka , 2023). The tourism industry has witnessed steady growth with a continuous increase in tourist arrivals from 2011 to 2018. However, tourist arrivals have significantly dropped since 2019 due to the Easter attack, the COVID-19 pandemic, and the economic crisis. However, by the end of November 2023, a reasonable recovery can be identified by recording 1.2 million tourist arrivals (SLTDA, 2023).

Sri Lanka is home to a diverse range of landscapes, including unspoiled beaches, verdant tea plantations, rain forests, tropical forests, incredible wildlife, unique cultural heritage, welcoming hospitality, amazing local foods, and many more. According to Conde Nast Traveler, Sri Lanka ranked 17th in the top 20 places to travel in 2022. Further, Sri Lanka was ranked 9th as the most friendly country in the world by Conde Nast Traveler (BOI Sri Lanka, 2023). According to worldpackers.com, Sri Lanka ranked 12th among the world’s safest countries in 2022. Sri Lanka is also ranked 4th as the world’s top wellness tourism destination for spiritual health by the Global Wellness Institute. These global rankings witness the attraction of Sri Lanka as a popular tourist destination.
1.2 Rationale of chosen project
Sri Lanka is among the best travel destinations because it provides a mesmerizing fusion of rich history, stunning scenery, and a dynamic culture. Thus, Sri Lanka is one of the most popular choices among dynamic groups of tourists. Pleasure or vacation is the main purpose of tourists, visiting Sri Lanka (BOI Sri Lanka, 2023). According to statistics from the Sri Lanka Tourism Development Authority (SLTDA), 55% of tourists visit Sri Lanka for the purpose of pleasure or vacation.
Some tourists travel to places to explore the world. However, in the current stressful world, some people travel places to treat themselves, make them happy, take a break from their daily routine, and find out who they really are. Due to a stressful and monotonous lifestyle, many people are seeking different kinds of breaks, which some people like to refer to as escapades. Thus, wellness tourism has become a growing trend in the market. Currently, wellness tourism accounts for a considerable portion of the global tourism industry. In 2019, the market share of wellness tourism reached $720 billion (Global Welness Institute , 2023). According to the Global Wellness Institute (GWI), wellness tourism can be defined as travel aimed at preserving or improving an individual's level of personal wellbeing (Global Welness Institute , 2023). It is different from medical tourism. Traveling with the intention of improving one's physical, mental, or spiritual well-being is known as wellness tourism. The World Health Organization states that wellness leads to preventing diseases, improving health, enhancing quality of life, and raising a person's degree of wellbeing to ever-higher optimal levels (Sri Lanka Tourism, 2023).
In Sri Lanka, the perception of wellness tourism is that it is a niche market limited to elite and wealthy groups of leisure tourists. However, at the global level, wellness tourism does not limit itself to the high-end market. GWI identifies two types of wellness tourists: primary wellness travelers and secondary wellness travelers (Global Wellness Institute, 2023). Primary wellness travelers are tourists whose primary motivation to choose the destination is wellness. Secondary wellness travelers are tourists who seek to take part in wellness experiences and maintain wellness while continuing their tours (Global Wellness Institute, 2023). Therefore, wellness tourism is a wider market, and Sri Lanka has high potential to attract both types of tourists. Wellness offerings in Sri Lanka are deeply rooted in Ayurveda, indigenous medicine, and Theravada Buddhist practices, a holistic system of medicine that balances mind, body, and spirit. A research reveals that the purpose of 34% of wellness tourists to visit Sri Lanka is Ayurveda treatment and holistic healing. 22% of wellness tourists stated that yoga practices as their purpose of visiting Sri Lanka (Fonseka & Kottage, 2021). 14% and 18% of wellness tourists’ purpose of visiting Sri Lanka are stress relieving, relaxation and mental, spiritual therapy respectively (Fonseka & Kottage, 2021).
Currently, key players in the market in Sri Lanka have positioned themselves as premium services that target high-end customers. Therefore, there is a market gap in Sri Lanka for wellness retreats that provide quality services at affordable prices for both of the above-mentioned customer segments. When considering the distribution of occupations of tourists visiting Sri Lanka, the main 4 occupational categories are professionals, businessmen, executives, and retired persons, respectively, which cover 35%, 12%, 8%, and 8% of the total number of tourists arriving in Sri Lanka (SLTDA, 2019). Therefore, all these categories can be attracted to a wellness retreat that provides quality services at an affordable price.