TOURISM

DEVELOPMENT
HANDBOOK for the
NORTHWEST TERRITORIES
TOURISM
DEVELOPMENT
HANDBOOK for the
NORTHWEST TERRITORIES
Acknowledgements
This handbook was prepared by Outcrop Communications for Tourism
and Parks, Department of Industry, Tourism and Investment, Government
of the Northwest Territories. Funding was provided through the Strategic
Investments in Northern Economic Development (SINED) Program of
Indian and Northern Affairs Canada.

We gratefully acknowledge the Government of Alberta, the Tourism

Development Branch of Alberta Economic Development, for granting
permission to use their Tourism Development Handbook for Alberta as a
primary source.

This handbook examines the Northwest Territories tourism industry

and provides an analysis of tourism development in the territory. The
information abides by the regulations set by the Territorial and Federal
Governments, making it a practical tool for the first-time business developer.

The handbook serves merely as an information guide, and prospective

developers are encouraged to undertake their own independent studies
and feasibility assessments to ascertain the viability of their specific projects.

While efforts were made to include current information, there is no

guarantee that changes will not occur with regards to the various processes,
contacts and regulations/permits outlined in this handbook. It is the
responsibility of the developer/entrepreneur to check on permits, regulations
and approval processes for his/her particular business opportunity.

The Government of the Northwest Territories disclaims any liability in

negligence or otherwise for any loss or damage, which may occur as a
result of reliance upon the material contained in this handbook.

If you have any comments relative to this handbook, please contact:

Tourism and Parks Division

Industry, Tourism and Investment
Government of the NWT
P.O. Box 1320
Yellowknife, NT X1A 2L9
Tel: (867) 873-7903, Fax: (867) 873-0163

Cover photo: Fran Hurcomb, GNWT

ISBN 978-077-08-0168-7

2 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Contents

1. Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2. The Tourism Industry in the NWT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
General Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Types of Tourism Businesses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3. Key Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Business Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Marketing Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Conceptual Development Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4. Product Development Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Stages of Product Development and Innovation . . . . . . . . . . . . . . . . . 21
Quadrant I – Existing customer/existing products: . . . . . . . . . . . . . 22
Quadrant II – New customers/existing products: . . . . . . . . . . . . . . 22
Quadrant III – New customers/new products: . . . . . . . . . . . . . . . . . 23
Quadrant IV – Existing customers/new products: . . . . . . . . . . . . . . 23
Innovation in Product Development . . . . . . . . . . . . . . . . . . . . . . . . . 24
The Recipe to Product Development Success . . . . . . . . . . . . . . . . . 25
Research. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Innovation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
5. Defining the Product. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Initial Look at Market Supply and Demand . . . . . . . . . . . . . . . . . . . . . 31
Initial Look at the Development Process . . . . . . . . . . . . . . . . . . . . . . . 32
Developing a Business Concept . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
6. Information Collection and Evaluation. . . . . . . . . . . . . . . . . . . . . . . . . 37
Project Feasibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
7. Tourism Market Analysis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Types of Tourism Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Demand Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Supply Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Market Evaluation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Orientation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Demand Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Supply Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Summary Evaluation –
Making Sure Your Concept Meets the Demand . . . . . . . . . . . . . . . 46
Tourism Market Data Sources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Tourism and Parks Division. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
NWT Tourism. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 3

 Contents

8. Project Site Evaluation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Where to Start. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Location Analysis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Physical Resource Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Infrastructure Needs and Availability. . . . . . . . . . . . . . . . . . . . . . . . . . 57
Basic Health Standards. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Water Supply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Sewage and Solid Waste Disposal. . . . . . . . . . . . . . . . . . . . . . . . . 60
Power Supply and Telephone Service. . . . . . . . . . . . . . . . . . . . . . . 61
Public Safety- Police, Fire, Medical Service. . . . . . . . . . . . . . . . . . . . 62
Building and Land Development Requirements. . . . . . . . . . . . . . . . . 62
Building Codes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Maps and Physical Evaluation. . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Summing It Up - A Site Evaluation Matrix. . . . . . . . . . . . . . . . . . . . 65
9. Resource Impact Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Environmental Impact Assessment Process. . . . . . . . . . . . . . . . . . . . . 67
Preliminary Screening. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Environmental Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Environmental Impact Review. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
10. Financial Analysis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Financial Analysis – Check Lists . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Capital Development Costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Projected Income Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Projected Cashflow and Working Capital Needed . . . . . . . . . . . . . 75
Financing Methods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Starting a New Business vs. Purchasing an Existing Business . . . . . . 78
The Bottom Line – Evaluating Business Feasibility . . . . . . . . . . . . . . 79
Approaching Lending Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Business Support Services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
Public Sources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
Private Sources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Other Sources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
11. Tourism Licensing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Tourism Operator Licence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Other Regulatory Requirements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
12. Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Insurance: Protecting Your Business . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Risk Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
Useful Publications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93

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 Contents

13. Packaging The Product. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95

Product Theme/Focus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
Travel Mode(s) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
Consumer Time Commitment . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Itinerary Importance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Itinerary/Specific Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Bundled Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Market Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Product Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Market Ready. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Have You Market Tested The Product? . . . . . . . . . . . . . . . . . . . . . . 98
What Did The Customers Think? . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Did The Pricing Work? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Were You Able To Afford The Commissions? . . . . . . . . . . . . . . . . . 99
What Liability Insurance Do You Carry? . . . . . . . . . . . . . . . . . . . . . 100
Pricing The Product. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
Published Prices Versus Net Prices . . . . . . . . . . . . . . . . . . . . . . . . . 100
Commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
Block Space/Release Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Vouchers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Insurance And Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Marketing To The Travel Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
What Are Tour Operators Looking For? . . . . . . . . . . . . . . . . . . . . . 103
The Product’s Main Selling Features . . . . . . . . . . . . . . . . . . . . . . . 104
The Competitive Advantage Of Your Product . . . . . . . . . . . . . . . . . 104
What Commitments Do They Expect From You? . . . . . . . . . . . . . . 104
Timing/When Do They Do Their Planning? . . . . . . . . . . . . . . . . . . 105
Working With Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
14. Northwest Territories Tourism. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
Marketing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108
Advocacy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
Partnerships. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
15. Human Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
Staffing: Needs Change with the Seasons . . . . . . . . . . . . . . . . . . . . . . 111
Recruiting Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112
Training. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
16. Contacts and Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117
17. Sources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 5

1 Introduction

TERRY PARKER, NWT TOURISM

6 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Introduction 1
Tourism represents an area of significant opportunity
in the Northwest Territories. This handbook has been
prepared to assist anyone who is considering developing
or expanding a tourism business in the NWT.

This development handbook is designed to help you assess, plan and

implement your tourism project. The information provided is geared
towards the first-time business operator, who may not be familiar with
the development process in the NWT. For established operators, the
handbook can provide assistance for expansion or diversification of
tourism products. All prospective tourism business developers are
encouraged to read the complete handbook before proceeding.

With the assistance of the material in this handbook, you will be able to
gather all the required background information to develop or expand
a tourism business. Charts are used throughout the handbook to help
illustrate the development process. Checklists are used to highlight some
of the many questions tourism entrepreneurs must ask themselves as they
evaluate the potential risks and rewards of a prospective tourism business
development. To further assist you, contacts and information sources
are provided throughout the handbook, with a comprehensive listing
provided at the end.

Developing a tourism business differs significantly from developing a

more typical retail or service operation. The market for tourism facilities
and services is more difficult to define because it is subject to changing
trends, to the influence of high-and low-demand seasons and to the
varying expectations of consumers. Demand may be influenced by
culture, income, education, age, lifestyle characteristics and the nature
of the service or attraction offered.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 7

1 Introduction

The tourism industry must respond to the changing wants and needs
of consumers. The industry, and the entrepreneur to whom this handbook
is directed, must be responsive to new demands and trends if the product
or service provided is to succeed in the marketplace.

Tourism products are also extremely diverse. They may involve extensive
land development and the construction of several buildings, such as
a fishing lodge with individual cabins or an aurora viewing facility.
On the other hand, there are tourism businesses that own no land and
few, if any, buildings, such as flight-seeing or river-rafting operators.
The scale of tourism developments is equally diverse, ranging from
small owner‑operated canoe rental outfits, to multi-million dollar
four‑season lodges.

A final aspect that is unique to tourism development is that many

developments take place in less accessible locations or less populated
areas to take advantage of scenic wilderness. This means that a developer
must often evaluate unusual access or servicing requirements.

This handbook was created to provide information that addresses the

challenges specific to developing a tourism business. It provides the key
information required for a great start to an exciting and rewarding future
in the Northwest Territories’ tourism industry.

For assistance in developing your business, contact your regional office of

Industry, Tourism and Investment. Contacts are listed in Section 16.

Business or economic development officers are available to guide you

through the process.

8 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

Hans Pfaff, NWT Tourism

Introduction 1

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 9

2 The Tourism Industry in the NWT

Terry Parker, NWT Tourism

10 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 The Tourism Industry in the NWT 2
The Tourism Industry in the NWT
• Background
• General Overview
• Types of Tourism Business

Background
The Northwest Territories has had an active tourism industry for over 50 years.

Initially the industry was made up mainly of fishing lodges, hunting

outfitters, airlines and a few hotels. Today the Northwest Territories tourism
industry includes over 400 companies providing direct visitor services,
and many additional companies such as restaurants and gift stores, that
serve both resident and visitor clientele.

Tourism operators first joined together in the late 1950s to form an

industry association. Over the years the association expanded with the
growth of the Territories, and in 1996 a new organization was established
to both represent the interests of the tourism industry and to assume the
role of tourism marketing agency for the Northwest Territories.

Today Northwest Territories Tourism (NWTT) administers a marketing and

operations budget of approximately $3 million with a full time staff of
eight people. Marketing funds are received from both the territorial and
federal governments and are used to build a sustainable tourism industry
for all residents.

A separate Tourism Marketing Advisory Committee was established in

2006 and is made up of representatives from industry and government.
This group works with Northwest Territories Tourism on the development
and approval of annual marketing programs.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 11

2 The Tourism Industry in the NWT

General Overview
A healthy economy should be diverse and grounded in many sectors. In
the Northwest Territories, tourism offers the potential to fulfill a long-
standing vision of increased economic diversity. It can also offer a more
equitable distribution of wealth to smaller communities. These goals
have been identified as priorities in the Government of the Northwest
Territories’ economic strategy “Economic Diversification – Equitable
Access”. The Northwest Territories is in the midst of an unprecedented
economic boom driven primarily by non-renewable resource
development. With the increase in business travellers and new awareness
of the NWT attracting leisure travellers, there is potential to fully realize
tourism opportunity in the NWT.

The tourism industry is made up of a number of businesses including big

game outfitters, fishing operators, outdoor adventure providers, as well
as related sectors including transportation, accommodation and food
services. Supporting tourism growth requires an inclusive approach that
looks at the individual components of the whole tourism package.

Tourism is both an important and growing industry. It is becoming

increasingly sophisticated, as evidenced by the varied segments and
products that make up the industry. In Canada as a whole, tourism
spending reached $66.8 billion in 2006, a 6.5% increase over 2005, and
the third consecutive annual gain since the downturn in tourism in 2003.
Overall, tourism employment in 2006 reached a total of 633,600 jobs.1 The
importance of tourism to the NWT is illustrated by recent visitor statistics.
In 2006-2007, an estimated total of 62,045 non-resident travellers visited
the NWT and contributed approximately $110.2 million to our economy.2

1
Source: www.corporate.canada.travel/en/ca/research_statistics/statsFigures/
tourism_performance/quarterly_national_ tourism_indicators/2006/NTI_2006_
year_review.html
2
Source: www.iti.gov.nt.ca/parks/tourism/research_and_statistics.htm

12 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 The Tourism Industry in the NWT 2
Types of Tourism Businesses
The diversity in the NWT tourism industry attests to the wide range of
needs and expectations of the Northern traveller. The table below outlines
examples of the different kinds of businesses that cater to tourists as well
as a general overview of what they are coming to experience.

Accommodation Bed & Breakfasts, Hotels, Motels, Lodges, Cabins,

Campgrounds

Transportation Rental Cars, Taxis, Charters – Airplanes and Boats, RV’s,

National and Local Airlines

Tour Operators Fishing, Hunting, Aurora, Local sightseeing, Local

Flightseeing, Adventure, Aboriginal Culture, Northern
Heritage, Winter Activities, Canoeing/Kayaking, Wildlife/
Birdwatching, Hiking, River and Lake Cruises

Highway Routes Dempster Highway, Waterfalls Route, Heritage Route, Great

Slave Gateway, Frontier Route, Ingraham Trail, Wood Buffalo
Route, Liard Trail

Events and National Parks, Territorial Parks, Caribou Migration,

Attractions Mountains/Trails, Waterfalls, Mackenzie Delta, East Arm,
Pingos, Aboriginal and Northern Culture, Historical Sites,
Communities, Great Northern Arts Festival, Caribou Carnival,
Folk on the Rocks, Snowking Winter Festival, Sunrise Festival
and many more

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 13

3 Key Plans

Terry Parker, NWT Tourism

14 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Key Plans 3
Key Plans
• Business Plan
• Marketing Plan
• Conceptual Development Plan

A crucial part of tourism business development is the preparation of

key documents that will provide a very clear idea of what you want to
do, where you want to be and how you are going to get there. With the
assistance of the material in this handbook, you will be able to gather all
the required background information in order to prepare three key plans:
• The Business Plan
• The Marketing Plan
• The Conceptual Development Plan

In general, all plans and proposals should contain clearly stated and
accurate information. Each plan or proposal must interest the reader in your
project and be clear with any related request for assistance, particularly as it
relates to financing. First impressions do count. An organized, professional
looking presentation and well-documented information are definite assets.
For most development applications, the proposal should also be easy to
photocopy because it will be distributed to several people for review.

These three documents will guide you more easily through other steps
of the development process, including securing financing and obtaining
your licences and approvals. This section describes the elements of each
plan so you have a good idea of what you will specifically need to do as
you read through the rest of this handbook.

Greater detail and information requirements for these plans can be found
in Section six: “Information Collection and Evaluation”.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 15

3 Key Plans

Business Plan
The summary of all your financial research will be encompassed in your
business plan. The plan describes your business goals and the business
concept in relation to local/regional and tourism markets. It outlines
the way in which you intend to finance and manage your project. It
incorporates a detailed financial analysis, including cash flow forecasts,
projected income statements and pro-forma balance sheets. The business
plan is the basis of your submission to lenders and investors; be sure to
present estimates of future profitability based on research and sound
assumptions. This plan is also your own guide to what you expect your
business to achieve. It should contain:
• A summary of your proposal, the intended product/service and target
market group(s), a description of industry trends, your competitive
positioning, management highlights and the financing request at hand.
• A description of your business goals/objectives, anticipated sales volume,
market share, visitor satisfaction, repeat visitation and/or other similar
targets.
• A marketing plan that includes a description of products/services to be
offered and an analysis of the market, trends, competition and identification
of your target markets. It should also highlight your sales and promotional
strategy. This section may be presented in a separate plan.
• A financial plan, that includes projected income statements, cashflow
statements and pro-forma balance sheets that provide detailed monthly
operating forecasts for the first year of operation and annual forecasts
for the next two to three years. (Includes opening balance sheet and
statement of construction/start-up costs and sources of financing.)
A discussion of debt/equity financing, and the corresponding ratio
analysis are required. Include financial statements with the previous
year’s balance sheets and income statements (for an existing business).
(May also include personal net worth statements of the shareholders.)

16 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Key Plans 3
• A management plan, which will set out the organizational form and structure
of the business. It should highlight the skills, experience and responsibilities
of the management team. This section should contain a discussion of the
developer’s background – who is involved, what other business ventures is
he/she involved in and what is his/her track record in business.
• An operations plan, discussing operational parameters such as hours of
operation, insurance, risk management practices, cash/credit handling,
procurement, staff training, etc.
• A project schedule, covering government and financial approvals,
construction period and preparation time before the development
opens its doors.
• A staffing plan, based upon detailed human resource requirements.
Summarize duties, responsibilities and reporting relationships. You may
choose to do a more detailed human resource plan to supplement the
business plan.

For more information about developing a business plan, contact the

Canada/NWT Business Service Centre (www.canadabusiness.ca).

Marketing Plan
Your marketing plan can take two forms. It is a major component of your
business plan and it may also be a separate document that expands upon
and details the marketing information contained in the business plan.

The supply and demand analysis undertaken as part of determining

project feasibility gives you a clear picture of the people you are aiming
to attract and the competition you are faced with. Your marketing plan
outlines the strategy for achieving your targeted share of the market. This
plan is an important step and should be started early in the development
process. Your marketing plan should include:
• A definition of your target market(s) including type, size and geographic
region. Provide a profile of the clients you anticipate attracting
(Demographics: age, sex, household composition and income.
Psychographics: interests, beliefs, values and activities).

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3 Key Plans

• An analysis of the tourism supply, i.e. who your competition is , what their
strengths/weaknesses are, how you will position yourself vis a vis the
competition, what your competitive advantage is and what percentage
of the market you feel that you can attract.
• A section on how you plan to initially attract your clients. Outline a
campaign for marketing the development through various media (print,
broadcast, etc.) complete with costs and schedules according to your
proposed opening date.
• A section on future marketing efforts. Marketing efforts to launch a
development often differ from ongoing marketing efforts. A section
of the marketing plan should generally discuss the timing and
shift of resources and strategy. This should also include additional
market research, over and above that done to initially investigate the
opportunity (e.g. customer feedback forms and customer databases).
• Overall advertising strategy. Contact local and regional media for reader/
audience data, rates etc. Talk to other operators for proven techniques.
• Overall sales strategy. How will personal sales activities be utilized to
capture business?
• Planned promotional campaigns. Determine the timing of these activities
(discounts, contests, publicity, etc.) and estimate the associated costs.
• How you will use referral groups and associations such as NWT Tourism,
tourism destination regions, destination marketing associations,
Chambers of Commerce and tour companies?
• Examine road signage needs and restrictions (where applicable).
• Cooperative and joint marketing efforts with other operators.
• Dollar requirements and marketing budget.
• Method of evaluation. How will you measure the effectiveness of your
marketing efforts?

NWT Tourism has developed two marketing guides to assist with

marketing initiatives: Market Ready: the NWT Tourism Handbook and Online
Tourism Marketing for Beginners. Both are available from NWT Tourism.

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 Key Plans 3
Conceptual Development Plan
The information gathered through the site evaluation process is used
to prepare a conceptual development plan that summarizes all the site
conditions and resources. It includes a schematic diagram of all proposed
buildings and facilities and the intended means of servicing them.

This concept plan is the basis for obtaining land-use approvals and for
developing cost estimates used in the financial analysis. Make sure all the
questions have been answered and the concept plan is complete. If the project
is large, it may be advisable to obtain the help of a professional consultant for
concept plans and cost estimates for buildings and site development.

The physical concept plan is a combination of graphic and written

information. This package should include:
• A site analysis summary outlining the physical features of the site and
noting any deficiencies that must be overcome.
• An environmental impact statement reviewing the existing environment
and its capability to adjust to the proposed development. Ways of
mitigating and minimizing negative impacts are laid out as part of the
development, community liaison and construction processes. This may be
a separate document depending on the scale of your development and the
requirements specified for land leasing and/or a development permit.
• A program statement describing the users, activities and interactions in
physical design components and what is required in each.
• An illustration that generally places all the physical development
components on a map of the site and shows all circulation patterns
between active areas.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 19

4 Product Development Planning

Terry Parker, NWT Tourism

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 Product Development Planning 4
Product Development Planning
• Stages of Product Development
and Innovation
• Innovation in Product Development
• The Recipe to Product Development
Success

Stages of Product Development

and Innovation
Product development for tourism businesses has a number of stages
or approaches. For many, most time and effort remains focused on
maintaining and delivering existing products to current customers. From
time to time, existing products and experiences are refined to attract new
customers and retain existing customers. Some operators commit to adding
new products and experiences each year to retain existing customers.

The most difficult product development strategy, and the highest risk
strategy, is to develop new products for new and/or existing customers.
The Canadian Tourism Commission book Passages to Innovation provides
one tool to support a strategy that includes the development of truly
innovative and new products.
New Products
IV III
Existing Passages to New
Customers Innovation Customers

I II
Existing Products

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 21

4 Product Development Planning

This model cannot be used to explain the industry as a whole. It must be

taken within a specific segment for comparison.

For example, when speaking of “high yield” customers, the specifics

of that demographic would vary significantly between Australian
backpacking youth versus American empty nesters looking for spa
vacations. However, within each of these segments, there are identifiable
groups who are higher yield than the other (relative to that segment).

This said – details of any quadrant would vary in terms of return on

investment (ROI) and potential depending on the industry segment.

Quadrant I – Existing customer/existing products:

This quadrant represents the lowest risk strategy.

In this instance, the organization is catering to its current market

segments with its existing product range. Two examples of this would
be: 1) a 16‑person fishing lodge geared to attracting middle aged males from
the U.S. Midwest, and 2) a caribou hunting operation that attracts 50 male
hunters to its barren ground location each year.

Quadrant I is a familiar quadrant and remains a safe bet for many

organizations. However, due to current events, such as changes in
currency values and SARS, the tourism consumer is changing and
organizations must not only react to the new trends, but also be proactive
in order to be ready for the new market once the “dust settles”.

Quadrant II – New customers/existing products:

This quadrant represents a slightly higher risk strategy. An organization
entering this quadrant should keep a portion of its efforts in quadrant I.

Selection of new market segments are made based on extensive market

research and evaluation. Using this market information, a product may
be modified to best reflect the needs of the new market – this does not
constitute a new product.

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 Product Development Planning 4
For example, the NWT aurora viewing market has determined that upscale
Americans are interested in aurora viewing and could be a potential market if
some adjustments are made to the product.

Quadrant III – New customers/new products:

This quadrant represents the highest risk strategy.

New businesses all start in this category. It is very delicate and must
be executed with caution. Research is the basis of success. Inventory,
assessment, competitive analysis and clearly defining one’s unique selling
proposition (USP) will be keys to success.

As an existing organization, creating a new product to deliver to new

customers is “tricky”. It is important to continue to use the USP or brand
proper to the organization and then, to convey that to a new market
through new products.

(An example of this quadrant may be) an NWT fishing lodge that wishes
to change its product from fishing to wildlife viewing, and is going after a
younger European market.

Quadrant IV – Existing customers/new products:

This quadrant offers a potential high-risk strategy.

When presenting new products to your existing customers, you want to

ensure that these new products will cater to their needs and not alienate
them. Your existing customers will, however, be more willing to “try”
new products coming from an organization that they have trusted. Don’t
disappoint them!

An example of this could be a fishing lodge that retains fishing as a base

product, but adds peripheral products such as fish preparation and cooking
instruction, fly-fishing lessons or fishing competitions.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 23

4 Product Development Planning

Innovation in Product Development

To understand the impact of innovative product development, here are
two Canadian tourism examples that illustrate how operations must
be open to reinventing themselves and responding to the needs of the
marketplace.

Example I:
The Excellence and Innovation in Product Development Award was given to
Upper Oxbow Outdoor Adventures (New Brunswick) in 2007. Upper Oxbow
Outdoor Adventures is a family-owned Atlantic salmon angling business
offering world-class experiences on the banks of the Miramichi River. After a
successful 15 year run operating as a pure fishing lodge with four log cabin
fishing camps and a cook house, Debbie and Dale Norton had a vision to
expand and diversify. Their determination has turned the business into
a four‑star, year-round resort offering high-end accommodations. Their
creativity lead to a number of new packages, such as the Women in Fly
Fishing schools, a learn-to-fish program for women and their cultural sand
bread package where anglers enjoy bread baked in the sand by the river as
they fish. (Source: www.gnb.ca/cnb/news/tp/2007e0740tp.htm)

Example II:
The tourism season is also very short for most operators with businesses
often being a seasonal operation. Visitors to Dunroven B and B and Sea
Cottage are part of a working farm which not only offers accommodation
but also an opportunity to take part in activities on the farm. Guests have
the opportunity to take blacksmithing lessons on an on-site 1927 coal
fired forge or take part in hands-on training of working Brown Swiss oxen.
Access to television or telephone is non existent on the premises and
there is a hot tub on a deck overlooking the ocean. Dunroven is a very
unique business where…“people come to entertain themselves, not to be
entertained and where guests can come relax and have an opportunity to
sit back and watch the trees grow.” (Source: web.mala.bc.ca/trip/Dunrove
n%20Band%20B%20and%20oxen%20farm.pdf)

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 Product Development Planning 4
The Recipe to Product Development Success
Many tools3 are available to assist any organization in the development
of products that respond to market demand. Based on the diagram
on page 21, and referencing your organization with the quadrants on
pages 22 and 23, it is clear that successful marketing requires innovative
product development that clearly responds to market demand.

As such, the following “recipe” will assist you in developing your business
and products for the consumer.

Before following this recipe, you should have identified where in the
previous quadrant your business or partnership is situated. The location of
your organization on the quadrant will determine the depth of activities in
the “recipe” that you must follow.

The recipe will give you the basic understanding of the steps to
be followed. What specifically you are trying to achieve should be
determined with your position on the quadrant and your partnership’s
objectives for the next 3-5 years.

Research
Research is the undertaking and collecting of relevant, timely data, which
will ensure you are meeting market demand now, and will be market
driven in the future. Depending on your position on the quadrant,
research requirements will vary.

A step-by-step process for successful research in product development

includes:
• Inventory – When identifying your organization on the sample quadrant,
you must first, take an inventory of your existing product offering.
This entails identifying all organizations involved in your market and
taking stock of the various product offerings within each organization.
The list should be exhaustive and include everything from week-long
packages to merchandising.
You are encouraged to seek out literature and resources that reflect your business
3

and can enhance your development of product and market.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 25

4 Product Development Planning

• Assessment – This is a critical part of the process to identify your position

on the quadrant model. Once you have completed the inventory of
your various products, you must then assess them in terms of market-
readiness and validate their existence. This step identifies your position
and your strength in quadrant I and any other quadrant you may be
positioned in. Once you have determined your position and strengths,
you are ready to define your future objectives and move towards
innovation.

Innovation
• Market research – Before the actual "act of innovation", you must identify
your market(s). You can build the nicest castle in the world, but if no one
wants to see it, it would be a waste of resources!
When studying your market(s), identify current demands (which will
strengthen your evaluation of your current position) and, identify trends
(which will identify the upcoming demands over the future timeframe
of your development). Identify demographics, psycho-graphics and
socio-graphics. Look for long-term "desires" within your market. When
working in product development, you are not responding to immediate
needs from your consumers, but rather to those demands they will have
in 3-5 years.

• Gap analysis – Cross-referencing your inventory of "strongly" market-

ready products with the identification of market trends over the next
3-5 years will allow you to identify the "gaps" in your current product
offering. You must then define which elements from the "gap" are
realistically achievable. This step identifies how motivated you are to
achieve identified goals.
• S.W.O.T. analysis – This is a brainstorming analysis to help you determine
your current position (starting point). During this process, you should
work with your partners to identify: strengths, weaknesses, opportunities
and threats that can help (or hinder) you as you work towards creating
your new products. This gives you your starting block to identify the
distance between where you are and where you want to go.

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 Product Development Planning 4
• Planning – Planning is an integral part of the "Product Development
Planning" phase of marketing. As such, it follows the extensive research
component in order to become our "map to innovative product
development" and, therefore, should include solutions to the next steps
in the process.
Using the research conducted, determine a solid business plan, which
gives you direction and step-by-step processes to follow. In your business
plan, identify where you are, where you want to go, what it will take to get
there and who is needed to do what. Be sure to incorporate an evaluation
method to ensure that you are on track and an evaluation tool to
determine the success of your business plan. Do not forget the infamous
“feedback loop”; once your project is complete, it is never complete. You
must evaluate it, identify the gaps between your ideal scenario and what
actually happened, then, iron out the kinks and go for round two.

• Partnership – In tourism, product development is rarely (if ever)

successful when conducted solely by one organization. Clearly each
organization must have its own product offering, but when we refer to
innovative product development, the strength is in QUALITY. To achieve
recognizable quality, it is best to work in like-minded groups who
share a vested interest in promoting a product (rafting the Nahanni)
or a region (the Mackenzie River Delta) or a cultural cluster (Aboriginal
tourism).

When working through this step, you need to identify:

• Who is interested in the project? Who shares a vested interest in
developing and promoting the product?
• Who is missing from the original "brain trust" of the project?
• How do you recruit new partners? What's in it for them?
Some of this work should be done at the onset of the project. The
answers to these questions should be a part of the planning process.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 27

4 Product Development Planning

Terry Parker, NWT Tourism

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 Product Development Planning 4
• Product Development – You have now identified the goal of the project
and the players. So, put on your creative cap and start building!
Using the research, you have defined what you would like to create.
Using the planning and partnership steps, you have identified how you
would like to create and whom you would like to create with.

In this area, you want to work through the business plan, continuously
looking back at your research reports, opening the conversation
throughout the partnership to ensure the highest level of buy-in. In the
end, you should develop experiences and packages that will respond to
your market demand research and fulfill your business plan objectives.

• Testing and Evaluation – Once you have developed the product, the
experience, the package or the brand, test it. Create a pilot project using
a sample of your selected market.
You can test your product with a segment of your market, with travel
agents and tour operators, media or other representatives who will
"sell" your product.

In this phase, ensure there is an evaluation form that the participants

can complete in order to give you feedback on successes and missing
pieces. You'll use this information to iron out the "kinks".

The evaluation criteria need to be set out during the planning process.

• Launch The Product – Once you have developed your product and
are comfortable with its strength, you are ready to deliver it to your
consumers and continuously enhance it as time goes on.
Remember that continuous evaluation must be conducted to make
enhancements and determine the product's long-term feasibility.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 29

5 Defining the Product

Terry Parker, NWT Tourism

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 Defining the Product 5
Defining the Product
• Initial Look at Market Supply
and Demand
• Initial Look at the Development Process
• Developing a Business Concept

Initial Look at Market Supply and Demand

At the beginning of the development process, there is usually a good
idea or an intuitive “gut-feeling” that a certain facility or service makes
sense, or that a certain location has potential for tourist activities. This is
an important place to stop and ask questions and do some brainstorming
with people knowledgeable about similar developments.

Before proceeding into detailed development analysis, it is critical to

determine who the potential customers are for this facility or service (the
target market), and whether their demand is already being met by other
businesses. If this preliminary market analysis does not favor development
it is wise to rethink the initial concept. Ask yourself these questions:
• What competing facilities or services are in the area? How many are
there? Are they full-time or seasonal operations? Have these operations
been successful?
• What is the nature of the tourist traffic in the area - who visits, how long
do they stay, what services do they use? Has tourist traffic to the area been
increasing, decreasing or holding its own over the last several years? What
share of the tourist market do you think your business will capture?
• If this is a new type of tourism business for an area that has not
previously been developed for tourism, what information do you have
that supports its potential to bring tourists to the area? Have other
facilities failed in similar circumstances? Why do you think you can
succeed?

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 31

5 Defining the Product

You can answer many of these questions by talking to other tourism

operators and agencies/organizations involved in tourism development.

Northwest Territories Tourism produced a booklet titled Market Ready:

the NWT Tourism Handbook which clearly and concisely outlines the
components of marketing, why it is important and how to undertake a
simple marketing plan. A review of this booklet is useful as the long-term
financial health of a business rests on its ability to attract and retain paying
customers.

www.spectacularnwt.com

Initial Look at the Development Process

It is a good idea to have alternative locations for your project in mind,
particularly if you are looking at developing a land-based project such as a
fishing lodge or a wildlife viewing ‘safari’ area.

The land base of Northwest Territories is a mix of Crown, Commissioner’s,

Municipal and Aboriginal-owned lands. There are a number of procedures
for gaining lease rights to land and these will affect the length and
complexity of the overall development process.

Most tourism projects will require development permit approval. It is

prudent to be aware of the procedures involved in obtaining approvals for
a development on a land base in that “perfect” location.

The Land Administration office of Indian and Northern Affairs Canada

(INAC) is responsible for managing Crown land throughout the NWT.

Land Use information is available from the INAC regional office in

Yellowknife. Visit their website at http://nwt-tno.inac-ainc.gc.ca/la_e.htm
or call (867) 669-2500.

General information on land use planning approval process for

Commissioner’s land is available from Lands Administration Office in
the Department of Municipal and Community Affairs (867-873-7569 or
www.maca.gov.nt.ca/lands/index.html).

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 Defining the Product 5
Within city or community limits, land use planning, subdivision
and development control are the responsibilities of NWT
municipalities. For municipal government contact links, visit
www.maca.gov.nt.ca/governments/index.asp.

For Aboriginal-owned lands, it is necessary to identify in which land claim

area the site is located and approach the correct Aboriginal Organizations
to discuss plans for potential tourism development. There are four (4)
settled land claims in the NWT. Refer to the map on p. 34 for land claim
boundaries and settlement status. For Aboriginal Organizations contact
information and information about land claim agreements, visit the
following links:

Settled Land Claims

Tlicho: www.tlicho.com/
Sahtu: www.sahtu.ca/sahtulc.html
Gwich’in: www.gwichin.nt.ca/LCA
Inuvialuit: www.irc.inuvialuit.com/about/finalagreement.html

Unsettled Land Claims

Akaitcho: www.akaitcho.info/
Dehcho: www.dehchofirstnations.com/negotiations.html

Other land use considerations include environmental and heritage or

historical assessments. These will be discussed in Section 8.

An early look at financing is also critical to the success of a development. It is

wise to examine the financial requirements of the total project as well as the
current economic health of the community in which the project will operate.

A general idea of financial requirements should lead to an investigation

into sources of financing. Information can be obtained through a number
of methods and from a variety of sources, but a good place to start is with
the Economic Development Officer (EDO) for your community.

Attention to this area will help you realistically assess the feasibility of
undertaking your proposed project.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 33

5 Defining the Product

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 Defining the Product 5
In summary, the focus of this initial look at the development process
should consist of:
• an examination of the steps involved,
• an examination of the time involved in some of the steps,
• a broad financial picture, and
• a general picture of project timing.

Developing a Business Concept

If the initial review of the market looks positive and the development
process looks workable, a clearly defined project should be outlined. This
business concept can be simply stated as a goal, for example:
• To build an eco-tourism resort with rental cabins on Great Slave Lake
and attract visitors from the US market; or,
• To open a seasonal specialty ice cream store for summer visitors; or,
• To provide evening dogsled rides for aurora viewing to the growing
number of people on package tours from Germany.

The original concept will likely be altered throughout the process as more
site information, development costs or licensing requirements become
known. There may not be a commitment to a specific location at this point
as this will be the result of detailed site analysis. An entrepreneur should,
however, always maintain a clear statement of the business concept.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 35

6 Information Collection and Evaluation

Terry Parker, NWT Tourism

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 Information Collection and Evaluation 6
Information Collection
and Evaluation
• Project Feasibility

Project Feasibility
In determining the feasibility of a tourism project, as with any business,
accurate market assessment and careful financial planning are critical to
the success of the venture. For large or complex projects, professional
help is recommended. In evaluating projects, the following steps should
be completed, and all the questions should be answered.

These steps force even the most enthusiastic, idealistic entrepreneur with
a brilliant idea to make a realistic assessment of the risks and rewards of
a project. For some projects either the market or the financial analysis
(or both) may prove the idea to be not feasible, and a re-examination
may be required. The following steps highlight the need to complete an
economic evaluation before any investment is made.

There are several sources of assistance available to a prospective tourism

business developer. Private consultants can evaluate the project.
Alternatively, assistance can be obtained from:

• GNWT Industry, Tourism and Investment,

• Canada/NWT Business Service Centre (federal/territorial agency),
• Community Futures offices (federal government program),
• Business Development Bank of Canada (federal crown corporation) and
• NWT Business Development and Investment Corporation (territorial
crown corporation).

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 37

6 Information Collection and Evaluation

These government agencies, as well as charter banks, can provide a range

of services and publications that can assist you with the evaluation of your
project.

The steps that will help to determine how feasible your tourism product
will be are discussed in detail in the following sections. The steps include:
• Tourism Market Analysis,
• Project Site Evaluation,
• Resource Assessments,
• Financial Analysis,
• Development and Licencing Approvals, and
• Packaging the Product

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Terry Parker, NWT Tourism

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 39

7 Tourism Market Analysis

Terry Parker, NWT Tourism

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 Tourism Market Analysis 7
Tourism Market Analysis
• Types of Tourism Markets
• Demand Analysis
• Supply Analysis
• Market Evaluation
• Tourism Market Data Sources

Market analysis is a critical component of business research, particularly in

the tourism industry. The spending habits of tourists, their characteristics,
their reasons for traveling and the experiences they seek are constantly
changing.

The tourism developer must respond to emerging trends. If the

proposed service or facility is intended to capitalize on an innovative
new trend in the industry, the developer must research consumer
appeal to be assured that there are enough people interested in the
new concept, that they have enough money to spend on it and that they
are willing to spend their money on it. Such concerns can be answered
through a market research study.

Clearly defining the market for your tourism business enables you to
determine your marketing objectives. These objectives will direct the
marketing component of the business plan.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 41

7 Tourism Market Analysis

Essential Research

1. Market Analysis

→
Develop a concept for the right product or service in the right location
→
Research the current supply and demand for the product
→

2. Financial Analysis
→

Evaluate site location, costs, and infrastructure requirements

→

Evaluate capital debt repayment, cashflow

and operating costs, profitability
→

Evaluate rate of return and feasibility

→

3. The Business Plan

→

Develop marketing, operations and human resource plans,

and project schedule
→

Outline projected profitability, cashflow, working capital

and financing sources
→

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 Tourism Market Analysis 7
Types of Tourism Markets
Most travel surveys identify the main categories of visitors as people
travelling for pleasure, business, visiting friends/relatives or for personal
reasons. In your market research you should be more specific. For
example, potential visitors to your area or facility may be:
• Hikers • Government Employees
• Hunters • Bus Tour Participants
• Wildlife and Bird Watchers • Overseas Business Visitors
• Fishermen, Anglers • Overseas Package Tour
• Photographers Participants
• Shoppers • Educational Tour Participants
• Sports Teams and Spectators • Work Crews
• Conventioneers (and Spouses) • Commercial Travellers

Demand Analysis
Each visitor is looking for a different ideal experience and has specific
preferences for type of accommodation, food services, recreation, etc. As
a result, there are numerous ways to break the tourism market into sub-
groups. The important thing is to identify the groups (segments) that will
buy your product or service.

Once you have identified the one or more types of tourists you anticipate
(or would like to attract) you can then develop a detailed profile of your
target market(s). You should develop a clear understanding of this market
in terms of:
• Who they are (age, income, • Why they travel?
marital status, education • When they travel?
and lifestyle patterns)?
• How often they travel?
• How many are expected?
• How they travel?
• What interests them?
• How they spend their money?
• Where they come from?
• How price-sensitive they are?

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 43

7 Tourism Market Analysis

The Canadian Tourism Commission has a full range of market research

and  statistical data pertaining to Canadian and non-Canadian travel
markets. These reports are available through the Commission's
intranet site (Canadian Tourism Exchange). The web link is:
www.canadatourism.com/en/etc/etcindex.cfm

Tourism and Parks, a division of Industry, Tourism and Investment in

the GNWT, provides support for tourism marketing, research, training,
planning and product development. For recent market statistics, visit their
website at: www.iti.gov.nt.ca/parks/tourism/research_and_statistics.htm

Supply Analysis
It is important to evaluate the existing supply of tourism services and
facilities. You must determine:
• What competitive facilities are there in the market area?
• What are the current usage rates or occupancy rates for operators in the
regular and off-season?
• What share of the market can you expect to capture?

Market Evaluation
The following list includes many of the critical questions an entrepreneur
should attempt to answer before deciding to commit to a business concept.

Orientation
• What markets do you hope to attract or create?
• What is the nature of the area tourist traffic and what have been the
recent trends?
• Will the project be the first of its kind in the area? Why do you think it
will succeed?
• What recent surveys or market studies have been done for this area or
market component?
• Does the local community support the project? Are there any land,
environmental or socio-cultural issues that could pose a problem?

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 Tourism Market Analysis 7
Demand Analysis
• How many tourists visit the area in the regular and off-seasons?
• How many of these tourists could potentially use your service or facility?
• When do people travel to this area or facility? Weekends? Summer
holidays? During hunting season? Define the regular and off-seasons, and
corresponding visitor profiles.
• What proportion of tourists require accommodations?
• What preferences have been shown for hotel, motel, bed-and-breakfast
or campground accommodations? Is this pattern changing?
• What is the general origin of visitors to the area? How do they travel to the area?
• What is the average length of stay? Will your operation change any of these
trends?
• What is the forecast rate of growth in the number of tourists to the area?
Does the area actively promote tourism?
• If you anticipate a mainly local demand, what is the projected population
growth, average income levels, spending patterns, demographics (age,
sex, marital status) of the population?
• What are the main family types, income levels, lifestyles and socio-
economic profiles of current visitors? Does this fit with your proposal?
• Are there specialized user groups such as large organizations,
conventions or government frequenting the area?
• Is the demand mainly for a distinct season? Can this be extended? What
demand might be developed for off-season use?
• What do you estimate the demand for your business to be for the next
five years? What occupancy or usage rates are forecast for these types of
facilities for the next five years?

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 45

7 Tourism Market Analysis

Supply Analysis
• What competitive facilities are there in the market area? Which of these
do you consider to be your primary competitors?
• What accommodation facilities are in the area? What is the history of
occupancy rates? What are the seasonal rates? Is there enough available
capacity in the area to accommodate an increase in tourist volume that
may be caused by your tourism product/service?
• Are any other directly competitive operations planned for the area?
• What food and beverage facilities are in the area? What are their seating
capacities, hours of operation and turnover rates? Are they tourism-friendly?
• How would you describe the area's tourism capacity? Under-supplied or
over-supplied? What special attractions are in the area that would add
to general tourist activity or complement your operation?
• Is the project entering a very competitive market with well-established
competition? Are there substitute products/services available that could
serve as an alternative to your proposed tourism experience?
• What has been the performance of other facilities over the past five to
15 years? Steady growth, no growth or negative growth?
• Will your project attract customers away from existing facilities? Why?

Summary Evaluation –
Making Sure Your Concept Meets the Demand
• Does your project reflect market demand and consumer preferences for
this type of facility or service? What do you base this assessment on?
• Does this area need a business like yours? Why? How will you generate
community support?
• What share of the tourism market do you think the proposed project
could capture? Why?
• How do you intend to attract these markets?

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 Tourism Market Analysis 7
Tourism Market Data Sources
Detailed information on travel industry trends, demographics, visitor
spending habits, means of transportation and destination is readily
available. Both the Department of Industry, Tourism and Investment and
NWT Tourism can be important sources of information.

Tourism and Parks Division

Tourism and Parks is a division of the department of Industry, Tourism
and Investment of the Government of the Northwest Territories, Canada.
Tourism and Parks provides support for tourism marketing, research,
training, planning and product development. The division is responsible
for developing, operating and maintaining facilities that include parks,
visitor centres and interpretive displays.

Coordinator, Research and Planning, 867-920-3245

www.iti.gov.nt.ca/parks/tourism/research_and_statistics.htm

NWT Tourism
NWTT was established in 1996 as the collective voice of the Northwest
Territories tourism industry and the destination marketing organization
(DMO) for the NWT.

NWT Tourism, 867-873-5007

www.spectacularnwt.com

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 47

7 Tourism Market Analysis

Publications that may be of assistance include:

Canadian Travel Survey/International Travel Survey –

Statistics Canada’s Canadian Travel Survey and International Travel Survey
www.statcan.ca/english/Dli/Data/Ftp/cts.htm
www.statcan.ca/english/Dli/Data/Ftp/its.htm

Travel Exclusive – A bi-monthly newsletter for members of the

Canadian Tourism Research Institute that keeps travel and tourism
suppliers and executives up to date on the latest trends in the industry.
Available through the Institute. (Note: Must apply for membership that
involves a fee. Other travel research reports are also available from the
Conference Board of Canada with a membership.)
www.conferenceboard.ca

National Tourism Indicators – Quarterly statistics on Canada’s tourism

sector including; trends, numbers of trips, visitor origins, expenditures and
destinations. Available from Statistics Canada. www.statcan.gc.ca

Canadian Tourism Exchange –This is an intranet site operated by the

Canadian Tourism Commission. Through it, you can access a range of
statistics and research reports. www.canadatourism.com

Other information sources:

World
• World Tourism Organization – Is the leading international organization
in the field of travel and tourism. It serves as a global forum for tourism
policy issues and statistics. www.unwto.org
• World Travel and Tourism Organization – WTTC's mission is to raise
awareness of the full economic impact of the world's largest generator
of wealth and jobs. www.wttc.travel

48 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Tourism Market Analysis 7
Canada
• Statistics Canada – Maintains and interprets statistical data.
www.statcan.ca/start.html
• Canadian Tourism Commission – Provides a variety of publications and
market research on the tourism industry in Canada. (Note: You must apply
for a login & password to access the site.) www.canadatourism.com
• Canadian Tourism Research Institute – Provides members with
information and analysis on the Canadian tourism industry. This
research organization is part of the Conference Board of Canada.
(Note: You must apply for a membership, and this involves a fee.)
www.conferenceboard.ca/ctri/default.htm

• Tourism Industry Association of Canada – Encourage the development

of tourism in Canada as the national private-sector advocate for this
industry, representing the interests of the tourism business community
nation-wide. Its activities focus on legislative and regulatory barriers to
the growth of Canadian tourism. www.tiac-aitc.ca.

Lists of territorial tourism related organizations, tourism destination

regions, etc., can be found on the NWT Tourism website at
www.spectacularnwt.com

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 49

8 Project Site Evaluation

Terry Parker, NWT Tourism

50 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Project Site Evaluation 8
Project Site Evaluation
• Where to Start
• Location Analysis
• Physical Resource Analysis
• Infrastructure Needs and Availability
• Building and Land Development
Requirements
• Resource Assessments

Site selection is a key component of any business and is one aspect

in which establishing a tourism business may differ significantly from
establishing a business in another sector. A tourist may seek scenic beauty,
wilderness, adventure and excellent fishing, yet demand relatively easy
accessibility and amenities such as hot showers and a restaurant.

The rugged nature of much of the NWT may also require special attention.
A prospective developer must be aware of all site conditions as well as
know about the approvals necessary to use land in these areas. Evaluating
sites under consideration is a challenge and requires thorough research.

Many of the permanent installations that a tourist facility requires, such as

utilities, are the same as those needed by any operation.

This section provides guidelines as to:

• what types of physical resource information are required?

• who to contact?
• what approvals may be necessary?
• how to evaluate the site in terms of your business concept?
• how to prepare a physical concept plan as the basis of cost estimates and
financial evaluation?

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 51

8 Project Site Evaluation

Where to Start
Some tourism ventures begin with an idea and then search for a suitable
location for development e.g., a developer looking for a suitable site
to develop a fishing lodge. Others begin with a fixed location that
needs an evaluation for a certain project, such as proximity to a natural
attraction like a waterfall. Developers may work with realtors, government
departments or conduct their own site search. In either case, you need to
obtain the following information on the potential site and related maps
and drawings:
• suitability of the physical environment, including soils, slopes, water
quality and quantity, tree cover, shoreline access, views, amount of
snowfall, prevailing winds;
• status of the site including land ownership, land use bylaw classification,
easements, long-term planning projections, caveats, restrictive
covenants;
• servicing and utilities – water, power, sewer, telephone, natural gas;
• access - availability, special facilities needed, responsibility for
maintenance;
• land development requirements – clearing, grading, reclamation,
engineering; and,
• location analysis – does the site meet the needs of the target market?
The following checklists identify the specific information sources and the
questions that all developers should seek to answer.

Location Analysis
People must be able to reach the site. The converse is also true: the site
must be within a reasonable or conveniently accessible distance of the
anticipated target market group(s). Also, the developer should have some
understanding of the nature of the area – who lives there, what are the
municipal development plans for the area, and what are the attitudes
towards the development? Is the long-term future of the site reasonably
secure?

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 Project Site Evaluation 8
Some questions to be answered include:

Data Needed Contact/Data Source

How does the customer get there? • GNWT Department

What are the current and nearest of Transportation
transportation services? What are the costs of • Transport Canada
scheduled services? • Scheduled air carriers, bus lines
• Roads • Travel agents
• Air transport • Aircraft charter services
• Public transport, bus • GNWT Department of Industry,
Tourism and Investment
• Internet
• Local and Regional Tourism
Associations

Does the developer need to provide or build • Transport Canada

access to the site? If access is by private plane • GNWT, Department of
or helicopter service, can the proper licences Transportation
be obtained? What effect will poor weather or • GNWT, Department of Industry,
seasonal changes have on accessibility? What Tourism and Investment
quality of access is needed? What are the safety • GNWT, Department of
considerations? Municipal and Community
Affairs
• Local Municipality

How far is the site from the customer? How • GNWT, Department of
many people are within traveling distance? Transportation
What is the historical traffic count? • GNWT, Department of Industry,
Tourism and Investment
• GNWT, Department of
Municipal and Community
Affairs
• Local Municipality

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 53

8 Project Site Evaluation

Data Needed Contact/Data Source

What types of developments are in the adjacent • Indian and Northern Affairs
area? Are they compatible with your project? Do Canada
they visually or acoustically infringe on the site? • Site Inspections
What are the long-term plans for this area? Will • Local Municipality
there be any foreseeable significant changes in • GNWT, Department of
transportation patterns, servicing or land use? Environment and Natural
Resources
• GNWT, Department of
Transportation
• GNWT, Department of Industry,
Tourism and Investment
• GNWT, Department of Municipal
and Community Affairs

What are the attitudes of community members • Local Municipality

towards tourism development? • Local Aboriginal
Organizations

What other tourist facilities or attractions are in • Site Inspections

the area? Do they complement your proposal? • GNWT, Department of Industry,
Are there any planned parks or other public Tourism and Investment
facilities? • GNWT, Department of Municipal
and Community Affairs
• Northwest Territories Tourism
• Parks Canada
• Local Municipality

Is the proposed site on a Native Reserve or • Indian and Northern Affairs Canada
Land Claim Settlement area? Is the council • GNWT, Department of Municipal
active or interested in tourism as a means of and Community Affairs
economic development? • Local Aboriginal Organizations

If you aim to attract local/regional business, • Local Municipality

consider the socio-economic characteristics of • GNWT, Department of Industry,
area residents. What are average income levels, Tourism and Investment
dominant age groups and occupations? • NWT Bureau of Statistics
How does this compare to your target market? • Statistics Canada
What is the projected population growth? • NWT Chamber of Commerce
• NWT Aboriginal Business
Association

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 Project Site Evaluation 8
Physical Resource Analysis
In this part of the site evaluation the developer must determine whether
the physical conditions of the site are suitable for the intended use. These
are the key questions to be answered:

Data Needed Contact/Data Source

• GNWT, Department of
What are the soil types and slope of the
Environment and Natural Resources
property? Is it stable and suitable for building?
• GNWT, Department of Public Works
• Natural Resources Canada

Are there any natural hazards in the area • Environment Canada

that affect the site? Will the site be subject to • GNWT, Department of Environment
flooding, landslides avalanches? What are the and Natural Resources
typical snow levels? • Local Municipality
• Site Inspection

Are there any watercourses or areas of standing • GNWT, Department of

water on the site? Do these change significantly Environment and Natural Resources
through the years? Will either extremely high • Environment Canada
or extremely low water levels affect your • Mackenzie Valley Land and Water
development? Is the site in a floodplain? Do Board
other users have water rights on this? • Site inspection

What type of forest cover is on the site? Is it • GNWT, Department of Environment

within a Forest Management Area? Are there and Natural Resources
any cutting restrictions? Will the surrounding • Local Aboriginal Organizations
areas be logged in the near future? How will
the view be affected?

What are the shoreline or riverbank • Local Municipality

characteristics of the site? Can it be dredged • GNWT, Department of Industry,
for boat use? Can pilings be placed for a dock? Tourism and Investment
Can you get a permit for use of this water edge? • GNWT, Department of Municipal
Is it eroding? Does the water level change and Community Affairs
seasonally? • Mackenzie Valley Land and
Water Board
• Department of Fisheries and
Oceans Canada
• Local Aboriginal Organizations

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 55

8 Project Site Evaluation

Data Needed Contact/Data Source

What are the main fish and wildlife species in the • GNWT, Department of
area? What is the most recent inventory? What Environment and Natural
management programs are in place? Are there Resources
any seasonal restrictions that will affect your • Department of Fisheries and
development? What habitat Oceans Canada
protection is occurring to ensure the long-
• Local Aboriginal Organizations
term viability of fish and wildlife? What are the
hunting and fishing license requirements? • Indian and Northern
Affairs Canada

What is the climate of the area? What is the • Environment Canada

average annual rainfall and snowfall? Is the area • GNWT, Department
subject to drought? Is it windy? Which are the of Environment and Natural
sunniest months of the year? When does the Resources
first snow fall? When does it leave? How many
hour of sunight in summer, winter?

What is the status of this property? Who owns • Local Municipality

it? Who owns the adjacent properties? What • GNWT, Department of
easements and caveats are registered against Municipal and Community
the title? Are there any restrictive covenants in Affairs
place? What is the assessed value?
• Indian and Northern
Affairs Canada

What is the current land use bylaw • GNWT, Land Titles Office
designation? What is the long range planning • GNWT, Department
designation for this site and the surrounding of Environment
area? What type of approvals are needed in and Natural Resources
the planning process? Is there an Integrated
Resource Plan in place? • GNWT, Department
of Municipal and 
Community Affairs
• Local Municipality
• Local Aboriginal Organizations

56 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Project Site Evaluation 8
Data Needed Contact/Data Source

Is there any archaeological significance to • Prince of Wales Northern

the area? Will a historical resources impact Heritage Centre
assessment be necessary? Will some form • GNWT, Department of
of mitigation be necessary? Municipal and Community
Affairs
• GNWT, Department of
Education, Culture and
Employment
• Local Aboriginal Organizations

Is the site visually and physically attractive? • Site Inspections

Can negative attributes be overcome?

Is the site on or near a “protected area”? • Prince of Wales Northern

Heritage Centre
• GNWT, Department of
Environment and Natural
Resources
• Parks Canada

Infrastructure Needs and Availability

This is a critical point in site evaluation. Tourists expect a high quality of
services. Running water, clean washrooms, hot showers and power supply
are standard in most facilities. Costs for providing these basic utilities can
be high. It is important to carefully evaluate each of these costs, preferably
with professional help. In rural or remote areas, some ingenuity and
alternative solutions may be needed to provide services to visitors.
Know these costs before committing yourself to a site.

It is important to ask:
• Does the site have a secure supply of water? What is the water quality?
How many litres per minute are available? Is it adequate for fire
protection? Is it available year round? What are the costs to obtain or
develop a water supply?

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 57

8 Project Site Evaluation

• How will you dispose of sewage? Is there an existing system? What are
the costs of hook-up? Can the site physically support a septic system?
What are the standards for tourist use?
• Where is the garbage disposal site?
• What does it cost for disposal? Who is responsible for collecting it?
• What are the nearest sources of power or fuel for heat, light and
other needs?
• What are the costs of using or developing the power supply?
• Is road access of sufficient standard to attract tourists in poor weather?
• Is the location easily accessible by floatplane or other suitable aircraft
and are there refueling facilities if needed?
• What emergency services are available?
• Is there fire protection in the area? What about police, ambulance
and doctors?

Basic Health Standards

As a general rule, all food-handling facilities (restaurants, pubs, etc.) are
inspected regularly to ensure compliance with basic health standards.

In urban areas, the municipal health unit usually inspects public

and commercial premises and enforces health standards. In smaller
municipalities and rural areas the offices of the local department of health
handle these functions. In either case, the Public Health Act is the basis of
regulations, although municipal bylaws may supplement the Act.

To access the Public Health Act, please visit the website of Department of
Justice at www.justice.gov.nt.ca/PDF/ACTS/Public_Health.pdf

Some aspects of health standards are enforced through the Good

Building Practices for Northern Facilities, published by the Department of
Public Works and Services. Such rules are specified whenever a building
permit is issued (water supply, number of toilets). A single inspection
usually follows.

58 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Project Site Evaluation 8
Before building, please speak with the local health inspector. Obtain copies
of the relevant Public Health Act regulations and any necessary application
forms. These regulations will specify how you must handle sewage disposal,
what minimum facilities you must provide, and the food-handling methods
to be used. Notify the inspector when construction is complete.

Water Supply
A development must have access to an adequate supply of water. In a
community setting, please check with the municipality to determine the
costs of hooking up to the existing system and the existing development
standards (e.g. pipe size requirements). Inquire about user rates, which can
be a considerable cost for a busy tourist facility. The supply and quality of
water is usually the responsibility of the municipality. However, for remote
locations, water use is subject to licencing from different organizations
depending on the ownership of the land.

The Northwest Territories Water Board is a good place to start with water
licence inquiries. The NWT Water Board provides for the conservation,
development and utilization of the water resources of the NWT. An
application must be made to the Board and a licence issued prior to the
use of any waters or disposal of any waterborne waste. To contact the NWT
Water Board, please visit their website at www.nwtwb.com/index.html or
call (867) 765-0106.

If the water is located within settled land claims, it will be necessary to

contact the respective Land and Water Board responsible for managing
land and water resources in the designated region of the NWT. Depending
on whether the water is located within settled or unsettled land claim areas,
you may have to contact the Land and Water Board of the specific region.
For unsettled land claims, contact the NWT Water Board.

Sahtu Settlement Region

• Sahtu Land and Water Board, Water Licence Process, and Land Use
Permit Process, Fort Good Hope, (867) 598-2413, www.slwb.com/

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 59

8 Project Site Evaluation

Gwich’in Settlement Region

• Gwich’in Land and Water Board, Land Use Permit and Water Licensing
Process Guide, Inuvik, (867) 777-4954, www.glwb.com/

Tlicho Settlement Region

• Wek’eezhii Land and Water Board, New Land Use Forms and Water
Licence Application, Wekweètì, (867) 713-2500,
www.wlwb.ca/forms.html/

Inuvialuit Settlement Region

• Inuvialuit Environmental Impact Review Board, Environmenta Screening

Committee Operational Guidelines and Procedures, and Inuvialuit
Settlement Region Community Conservation Plans, Inuvik, (876)
777-2828, www.bmmda.nt.ca/downloads.htm

Mackenzie Valley Land and Water Board

• Mackenzie Valley Land and Water Board, Land Use Permit and Water
Licencing Process, Yellowknife, (867) 669-0506, www.mvlwb.com/

• Mackenzie Valley Environmental Impact Review Board, Yellowknife,

(867) 873-9636, www.mveirb.nt.ca/

In a rural setting, a developer must often provide the project with its own
water supply. The source will likely involve withdrawal and treatment of
water from a nearby lake or river. If a lake, river, stream or ground water
aquifer is to be used for water supply, a permit or licence must be obtained
from the NWT Water Board or an appropriate regional Land and Water
Board. It is very important to confirm the costs and availability of water
supply before making a commitment to the site.

Sewage and Solid Waste Disposal

In an urban setting, it is wise to discuss the project with the municipal
engineering department to find out the costs of hooking up to the
sewage system. The developer should ensure that territorial standards are
met with respect to the number of toilet facilities required.
60 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES
 Project Site Evaluation 8
For remote locations, commercial composting systems are available to
handle both human and kitchen waste.

According to the Good Engineering Practices for Northern Water and Sewer
Systems in Section 11.9.1., “Waste residual should be disposed of according
to community water licence requirements, preferably directly to the sewage
system. If returned to the water source, residuals must be disposed of
downstream or otherwise separated from the intake by 90 m and must be
approved by the authority having jurisdiction.”

The Department of Public Works and Services (PWS) has two publications
available on water usage and disposal:

• Good Engineering Practice for Northern Water and Sewer Systems – Guidelines

• Managing Drinking Water Quality in the NWT, A Preventative Framework and

Strategy – a system to safeguard NWT drinking water.

The documents are on the PWS website:

(www.pws.gov.nt.ca/publications/index.htm).

Power Supply and Telephone Service

Generally, power and telephone services in an urban setting pose few
problems. Check for connection charges and structural requirements. In
remote areas, these amenities may not be accessible. The developer is
generally responsible for supplying power and/or telephone access to the
site. Satellite phones, although expensive, are a good choice for isolated
locations. When choosing a power source the developer must consider
availability and accessibility. Alternative or multiple power sources may be a
viable option to consider, such as:

• Diesel-powered generators- for heat/ hot water purposes.

• Wood – for heating and hot water purposes.
• Solar – for electrical generation.
• Wind turbines – for electrical generation.
• Propane – for heating and appliances

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 61

8 Project Site Evaluation

Public Safety – Police, Fire, Medical Service

Developers must ensure that adequate security, fire protection and
medical services are available for the development. For many tourist
activities, particularly those involving outdoor sports, ambulance service,
local first aid and a nearby hospital are important concerns. Meet with
local authorities to discuss the needs of your development and the ability
of the local community to provide the necessary services. Security, fire
protection and medical services can be a particular challenge in remote,
isolated locations. Talk to:
• Municipal police or RCMP
• Fire departments and/or volunteer fire departments
• Local hospital emergency service, medical clinics, area doctor(s)

They can supply valuable information and potentially help you obtain
a better insurance rating for the development. If your development is a
seasonal operation, police and fire protection during the off-season are
still important. Assess ways to provide security at remote sites during
closed periods.

Building and Land Development

Requirements
When evaluating a proposed site, the developer must carefully look at
land development costs and the types of buildings and facilities needed.
If the proposal involves purchasing or upgrading an existing facility, costs
of renovation and meeting building codes must be carefully assessed.
Professional help is recommended at this stage – architects, engineers,
building – or land development contractors can help provide accurate
cost estimates to help determine the feasibility of the site. Don’t base your
site development evaluation on guesswork or one price quote – these
capital costs are vital to your success.

62 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Project Site Evaluation 8
These are the items to evaluate:

• Do the existing building(s) meet your immediate needs?

• What is the structural condition and life expectancy of existing buildings?
• Do the current structures meet building, health and safety codes?
• What renovations or upgrading of existing buildings or utility
infrastructure is required? What are the estimated costs?
• What new buildings are needed for the development? What are the
estimated costs?
• What special facilities are needed for this site? Can they be
accommodated, and if so, what are the costs? Are they technically
feasible? (Especially for marinas, helicopter pads, boat launches, etc.)
• What land development is needed?
• What are the estimated costs for clearing, grading and providing roads
and parking, landscaping, and hooking up to or providing services
and utilities?
• What are the off-site development costs?
• Is the site accessible to people with disabilities? Can this be improved?

Building Codes
The Good Building Practices for Northern Facilities, published by the
Department of Public Works and Services governs building standards in
NWT. Speak with the approving authority (the municipality) to determine
any special requirements.

Maps and Physical Evaluation

Most of the physical resource information a developer needs has already
been collected and compiled on maps by the relevant resource agency.
A developer can benefit from the professional evaluations of biologists,
pedologists (soils), foresters and geologists simply by referring to the maps.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 63

8 Project Site Evaluation

The following bio-physical information may be of interest in the

development process:
• aerial surveys
• large scale topographic mapping
• current land uses
• existing roads, rail lines, airports
• legal base maps (subdivisions, lots)
• land ownership maps
• resource capability maps for:
– recreation
– waterfowl
– ungulates
– mineral resources
• forest cover maps
• soil types and surface geology
• regional recreation inventories (parks, facilities)
• development constraints, natural hazards
• elevations
• significant biological and recreation areas
• land use bylaw and statutory plan designations

This information comes from many agencies including, but not

limited to Land Claim Councils, Hamlet Councils, the Department of
Environment and Natural Resources (www.enr.gov.nt.ca/), the Geological
Survey of Canada (http://gsc.nrcan.gc.ca/map/index_e.php), and the
GNWT Geospatial Data Warehouse
(http://maps.gnwtgeomatics.nt.ca/portal/index.jsp).

64 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 PROJECT SITE EVALUATION 8
Summing It Up – A Site Evaluation Matrix
Use this matrix as a checklist to make sure you’ve covered all the topics.
Complete the checklist for each site being considered. Use it to compare sites.

Excellent Suitable Needs Not Notes

Work Suitable
General Location
Visibility
Adjacent Land Uses
Property Land Use Bylaw
Classification
Scenic Views
Water Supply
Land Tenure/Ownership
Drainage, Watercourses
Power Supply
Existing Buildings
Local Attitudes Towards
Development
Proximity to Market
Current Land Use
Access
Long-term Outlook
Soils and Topography
Sewage Disposal
Clearing, Site Preparation
Environmental Quality
Shoreline or Water Access
Local Labor Supply
Archaeological Concerns

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 65

Terry Parker, NWT Tourism
 RESOURCE IMPACT ASSESSMENT 9
RESOURCE Impact ASSESSMENT
• Environmental Impact Assessment Process
• Environmental Impact Review

As part of the information collection and evaluation stage, there are two
assessment processes the proponent may be asked to participate in.

The Environmental Impact Assessment process is legislated by the

Mackenzie Valley Resource Management Act (MVRMA) or the Canadian
Environmental Assessment Act (CEAA). The Prince of Wales Northern
Heritage Centre is responsible for Heritage Impact Assessments.

Environmental Impact Assessment Process

In 1998, the Parliament of Canada approved the Mackenzie Valley Resource
Management Act (MVRMA). The MVRMA, described as an integrated
resource management system, was given effect to provide a coordinated
approach to the regulatory process in the Mackenzie Valley.
In the Inuvialuit Settlement Region, the Canadian Environmental
Assessment Act (CEAA) and the Inuvialuit Final Agreement guide the EIA
and regulatory process.

Besides ensuring increased public participation and a greater role for

Aboriginal people in land-use planning, the regulation of land and
water use and the environmental assessment and review process, the
MVRMA also establishes a network of co-management boards, which
are regionally organized throughout the Mackenzie Valley (e.g., Gwich’in,
Sahtu and Wek’eezhii Land & Water Boards).

While allowing residents and communities to participate in managing

the region’s land and water resources, each Review Board has a specific
mandate for managing resources in the Mackenzie Valley in a
sustainable manner.

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9 RESOURCE IMPACT ASSESSMENT

The EIA process is composed of three successive stages:

• Preliminary Screening
• Environmental Assessment (EA)
• Environmental Impact Review (EIR)
The EIA process is designed to prevent significant adverse impacts on the
environment. The process also ensures that the concerns of Aboriginal
people and other members of the public are considered. Most proposed
developments undergo preliminary screening only. If a proposed
development must go through the other stages of the EIA process, it is
because more information about the development is needed before a
decision can be made on whether the development should be accepted
or rejected.

No permit, licence or authorization can be issued until the EIA process

is completed and it is determined that the proposed development is
unlikely to cause significant adverse impacts on the environment or have
significant public concern.

Preliminary Screening
The Mackenzie Valley Land and Water Board (MVLWB) and the regional
land and water boards in settled land claim areas (i.e., the Sahtu, Gwich’in
and Wek’eezhii Land and Water Board) conduct most of the preliminary
screenings in the Mackenzie Valley, but Federal or Territorial Government
Departments are also responsible for preliminary screening in some cases.
Preliminary screenings are brief examinations of proposed projects that
take approximately six weeks. During this time, preliminary screeners and
other reviewers must determine whether a proposed development might
have a significant adverse impact on the environment, and/or might be a
cause for public concerns.

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 RESOURCE IMPACT ASSESSMENT 9
Environmental Assessment
If a proposed development is found by the preliminary screening
reviewers as having the possibility for significant environment impact or
be a cause for public concern the proposed project may be recommended
to the Mackenzie Valley Environmental Impacts Assessment Board
(MVEIRB) for an Environmental Assessment (EA). During the EA, MVEIRB
works with the developer, public, Aboriginal organizations and relevant
governments to identify and mitigate the impacts of the proposed
development. Following MVEIRB’s process a final recommendations
report is made to the Responsible Ministers to accept or reject the
proposed project or accept MVEIRB’s recommendations
with modifications.

Environmental Impact Review

If the MVEIRB concludes the impact and/or public concerns cannot
be mitigated, the MVEIRB may reject the development or order an
Environmental Impact Review. An independent Review Panel conducts
this review, giving its members an opportunity to examine and assess
specific details about the proposed development.

For more information about the EIA process under the MVRMA, please
visit the MVLWB website at (http://www.mvlwb.com/html/introduction.
htm) or the MVEIRB website at (http://www.mveirb.nt.ca/index.php).

For more information about the Canadian Environmental Assessment Act

and process, please visit www.ceaa.ca.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 69

10 Financial Analysis

Terry Parker, NWT Tourism

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 Financial Analysis 10
Financial Analysis
• Financial Analysis – Check Lists
• Approaching Lending Agencies
• Business Support Services

The financial analysis gives the entrepreneur a detailed picture of the costs
involved in starting up the enterprise, annual operating costs, projected
income and the means of financing the operation. This analysis will
determine whether the project is financially viable or whether changes are
needed either to the initial concept or to the financing arrangements.

For the new or seasonal type of tourism venture, it is important to compare

costs and revenues with other operations in the industry. If you are
expanding an existing business, you must be sure that increased revenues
will cover the costs of your changes, and provide an adequate return on
your investment. Most small business failures are attributed to insufficient
working capital to carry the business through its first two years of operation
– be realistic and accurate through the financial analysis process.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 71

10 Financial Analysis

This chart provides the basic steps in the financial evaluation process.

Steps in Financial Analysis

Determine Capital Costs

→
Determine Profitability, Cash Flow and Working Capital
→

Pro Forma (Projected) Financial Statements

→

Financing Methods
→

Evaluate Rate of Return and Feasibility

The NWT Business Development and Investment Corporation promotes

financial independence, assists communities in capturing economic
development opportunities, and helps develop a diverse and viable
northern economy. The BDIC provides a range of programs and services
to help northern business succeed. For more information about financial
analysis, visit the website for the Department of Industry, Tourism and
Investment for their list of business assistance programs
(www.iti.gov.nt.ca/iea/business/busprog.html).

Developers must also make a realistic assessment about the ability to

finance initial (legal, banking) capital development costs with debt
financing, equity financing and/or a combination of the two methods.
Inability to finance the project may mean the concept should be scaled
down, pursued on a phased basis or not pursued at all.

For more information on the types of financing methods, visit the website
for the Department of Industry, Tourism and Investment for their list of
business assistance programs (www.iti.gov.nt.ca/iea/business/busprog.html).

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 Financial Analysis 10
Your business plan should feature a statement of capital development
and start-up costs, along with proposed financing sources. This statement
should accompany the forecast for the projected financial statements
(Balance Sheet, Income Statement and Cashflow Statement).

Financial Analysis – Check Lists

Capital Development Costs
Capital development costs include all physical development needs as
identified in the concept plan. It is also important to determine which
items will be financed and which will be paid for through investments
and from earnings. A new business usually does well to minimize capital
outlays as much as possible, thereby keeping cash resources available for
current operating expenses and initial one-time costs.

As a general rule, a new operation should have working capital equal to

projected expenses for at least six months.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 73

10 Financial Analysis

Potential Capital and Start Up Costs

These costs may include:

Land acquisition $
Survey costs $
Utility infrastructure $
Engineering $
Architectural design work $
Professional fees $
Insurance $
Resource assessment fees $
Fees, appraisal and permit costs $
Site preparation $
Landscape work $
Building construction $
Renovation costs $
Access road $
Furnishings, fixtures, equipment $
Other leasehold improvements $
Vehicle requirements $
TOTAL $

Projected Income Statements

The income statement is a presentation of the revenues and expenses
incurred by the business during a given period. The Income Statement
uses accrual accounting where: 1) revenues are recorded at the time
that the sale is made even though payment of cash for these sales may
occur earlier or later and; 2) expenses are recorded at the time that their
corresponding revenue was recorded regardless of when the actual outlay
of cash was made.

Revenues and expenses are projected based on the results of previous

action steps in this handbook. Income, expenses and profits are
categorized in the income statement as follows:

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 Financial Analysis 10
Typically, the income forecast should cover these points:

• Revenue: Income generated from the sale of the company’s product

or service.
• Other Income: Income earned from other activities (e.g. interest earned
on bank deposits).
• Costs of Goods Sold: Expenses directly related to the production of goods
and services including purchases of materials, freight and labour.
• Gross Profit: Revenue minus Cost of Goods Sold
• Operating Expenses: All selling, administrative and
depreciation expenses.
• Operating Profit: Gross Profit less Operating Expenses.
• Interest Expense: Expenses resulting from debt financing.
• Net Profit Before Tax: Operating Profit less Interest Expense.

Projected Cashflow and Working Capital Needed

The cash flow statement records actual timing of cash receipts and
disbursements. The cash flow statement is the most important forecast
for a new business because it demonstrates whether or not you have the
actual cash on hand required to meet your financial obligations when they
come due. Cash receipts are cash inflows from cash sales, sales of fixed
assets, collections of accounts receivable, loan proceeds, and the owner’s
contributions. Cash disbursements are cash outflows for operating
expenses, payments to suppliers, repayment of loans and the acquisition
of fixed assets.

Not all sales are collected in the month in which they are made, and
not all expenses are paid for in the month that they are incurred. The
most important function of a written cashflow is its ability to provide
an estimate of the amount of money required to finance day-to-day
operations. It will forecast money coming in and money going out.

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10 Financial Analysis

A cashflow forecast can be a complicated item to prepare for the first time.
For a new entrepreneur, it may be difficult to predict sales and expenses.
Talk to other operators in the area, contact relevant associations and or get
some professional help. Realistic estimates are the key to business viability.
Cashflow forecasts should be prepared for at least the first three years of
operation. They will likely need revisions as the business situation changes.
If the forecasted figures vary considerably from the actual, some changes
in operation or financing may be necessary.

Review your cashflow with your lender, particularly if you plan to operate
on a line-of-credit. Know beforehand whether you must maintain a
minimum positive cash balance or whether you can operate on an
overdraft. Determine what the requirements are to securing an overdraft/
revolving line of credit.

Pro Forma balance sheets should be prepared for at least the first three
years of operation. It is also recommended that three types of financial
statements also be prepared for the construction/start-up phase prior to
the venture opening for business.

To aid you in preparing your financial statements, visit the website for the
Department of Industry, Tourism and Investment for their list of business
assistance programs (www.iti.gov.nt.ca/iea/business/busprog.html).

Financing Methods
In order to determine the best financial arrangement possible, an
entrepreneur must consider all potential sources of financing including:

• Owner’s investment
• Outside investment sources
• Loans from banks
• Other private lenders

The interest costs from each source must be calculated into the projected
income statement, and the proposed scheduling of repayment must fit
into the cash flow forecasts.

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 Financial Analysis 10
For more information about the various financing methods, visit the
website for the Department of Industry, Tourism and Investment for their
list of business assistance programs (www.iti.gov.nt.ca/iea/business/
busprog.html).

It is important to determine at a very early stage if you can raise the

necessary debt and equity financing for the project. Banks typically will
not lend more than 50% of the costs required to construct a new tourism
project. Developers therefore must have or be able to raise sufficient cash
equity to undertake a tourism project.

Notice that the last item on the income statement is your projected net
profit for the year. This forecast figure will be kept for comparison to the
actual net profit figure. At the end of each year, a condensed income
statement should be prepared. It will be similar in appearance to the
projected income statement, but will be actual rather than estimated
numbers. This is a valuable summation, as it will allow you to determine
your projected and actual break-even points. Income Statement forecasts
should be prepared for at least the first three years of operation.

They will likely need revisions as the business situation changes. If the
forecasted figures vary considerably from the actual, some changes in
operation or financing may be necessary. The Pro Forma Balance Sheets
are a snapshot of the financial condition of the business at a fixed point
in time. It shows what the firm owns (assets) and what it owes (liabilities
and owner’s equity). The balance sheet has three major sections: assets,
liabilities and equities.

Assets represent the total resources of the firm stated in dollar terms.
Claims against these assets are the liabilities and equity. The two sides of
the balance sheet equal each other - they balance. The excess of assets
over liabilities represents the net worth of the firm’s owners. Assets are
listed in order of liquidity, or nearness to cash. Thus, cash, being the most
liquid asset, is listed first, followed by other “current assets”.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 77

10 Financial Analysis

Current assets are assets, which will be turned into cash within one year
and include cash, marketable securities, inventory, accounts receivable
and prepaid expenses. Long term or fixed assets are those that are not
intended for conversion into cash within one year. Fixed assets include
land, buildings, equipment, furnishings and long-term investments.
Liabilities are also classified as being either current (due within one year)
or long term. Current liabilities include accounts payable, accrued wages
and current portion of long-term debt. Current liabilities are recorded first,
followed by long-term liabilities.

Starting a New Business vs. Purchasing an

Existing Business
The previous topics of the financial analysis have been directed toward
entrepreneurs interested in starting a new business. However, many
tourism developers choose to purchase an existing operation. Most of
the same steps in economic evaluation must be followed. In addition, a
potential buyer must ask some very specific questions about the existing
operation, its financial health, and the reasons why it is being sold. Some
of the key questions are:

• Is the opportunity available to purchase an existing franchise business?

• Has the business declined or been unprofitable in recent years? Why?
• Does the business require considerable investment to upgrade facilities?
Have you included these costs in your financial plan? Will you recover
these costs?
• What improvements to the facility, operations, management methods
or financing must you make?
• Do you have clear and professionally prepared financial statements
from the vendor for each of the past three to five years? Have you
reviewed prior years’ tax returns for the business?
• Do you have a current analysis of all assets (inventory, fixed assets,
accounts receivable) and liabilities (loans, taxes due, trade creditors)?
Does your financial analysis include projected cash flow and income
statements? Are these positive? Will you make a profit? Will you
generate sufficient cash flow? What about balance sheet ratios?
78 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES
 Financial Analysis 10
• How will you succeed in this business where previous owners failed or
received inadequate return?
• Have you reviewed the business potential and sale details with a
professional accountant and lawyer? Do you need to obtain an
independent appraisal of the assets?
• Are there any legal judgments against the company?
• Will the key employees stay with the business?

The Bottom Line – Evaluating Business Feasibility

The first four steps of the financial analysis identify the information
needed to determine projected costs and projected income. Now, you
must compare these amounts to determine whether the business is
really viable. There are several accepted methods of looking at business
feasibility. Talk to your lenders/investors about their preferred approaches.

When you have finished the next series of steps, you should know
whether the proposed business is worth pursuing:

• Break-Even Analysis shows the level of income needed to meet all

expenses (variable and fixed). Sales above the break-even point will
show a profit.
• Return-On Investment is expressed as a percentage and is the ratio
of profitability to owner’s equity over one year. It is often used for
comparing investment opportunities. If the return on investment is too
low, investors may decide against the project and opt for investment
opportunities that have higher returns.
• Debt- To-Equity ratio is a measurement used to compare the amount of
debt to the financial risk assumed by the owner(s). Usually, a ratio of $1
or $2 borrowed for every dollar invested is viewed as acceptable (a ratio
of 1: 1 or 2: 1); however, the acceptable ratio may vary by industry sector.

This is one of the ratios that is of particular interest to lenders.

The summary of your financial research will be encompassed in your
business plan.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 79

10 Financial Analysis

• Complete market analysis – a comprehensive review of the customers,

the competition, the demand for this project, the anticipated usage and
occupancy.
• Complete business plan, including capital cost estimates for facilities,
operating costs and a forecasted statement of income and expenses,
projected cashflow statement and Pro Forma balance sheets.
• Amount and purpose of the loan and the term for which it is required.
• The opening balance sheet or capital budget statement, identifying all
proposed sources of financing.
• Repayment plan – justify on the basis of cashflow projections.
• Type of security offered for the loan.
• References – business and credit related
• Does your market research support the viability of this business?
Does it have a well-defined market?
• Has there been development of new competition for this service or
product? Can the market support this amount of competition?
• Have other tourism-related businesses, or the area in general, suffered
an overall decline in visitors? Why?
• Has the business developed a poor reputation among tourists, among
the local business community, or among employees? Why? Will you be
able to overcome this? How?
• Does the business receive a positive rating in the site evaluation criteria?
Are there any land planning, regulatory or environmental issues that
could impact the viability of the business in the future?

For further information the prospective buyer should also meet with
lenders and with other members of the business community. Additional
information on buying a business can be obtained by visiting the website
for the Department of Industry, Tourism and Investment for their list of
business assistance programs (www.iti.gov.nt.ca/iea/business/busprog.html).

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 Financial Analysis 10
Approaching Lending Agencies
Most businesses require financial assistance for capital and/or operating
costs. To acquire such assistance, complete concepts plan and detailed
business plan are very important.

In addition to the key plans (see Section 3), most lenders will require the
following information and documentation:

• Background information on the development – where is it located, what

facilities are involved, who owns the property. Include any maps,
photographs or other visual displays.
• Background information on the developer – form of organization, who is
involved, what other business ventures is he/she involved in, what is his/
her track record, his/her assets and personal financial net worth.
Robert Redshaw, GNWT

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 81

10 Financial Analysis

Business Support Services

In NWT, there is an extensive network of support services available to
potential tourism business developers or owners.

Public Sources
Government of the Northwest Territories
• Department of Industry, Tourism and Investment Programs include
loans, contributions, grants and information services. Community
Economic Development Officers will be able to answer questions about
the programs available and what you need to meet the application
requirements.
Business Development and Investment Corporation (BDIC)
• The BDIC supports the economic objectives of the Government of the
Northwest Territories through a range of programs and services that:
– Encourage the creation and development of businesses;
– Provide information and financial assistance to businesses; and
– Make investments in business enterprises.
The BDIC promotes financial independence, assists communities in
capturing economic development opportunities, and helps develop a
diverse and viable northern economy with local employment prospects.
This role has both economic and social aspects.

Through the Canada/NWT Business Service Centre the BDIC provides

a wide range of information on small business programs, services, and
regulations to the public.

The Canada/NWT Business Service Centre offers:

– A business library—with reference and research materials

– Video conferencing—brown bag sessions and half-day seminars on
a wide variety of business topics.

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 Financial Analysis 10
– Computer workstations—access to publications, directories and
leading edge business products
– Online services—interactive business planner, online small business
workshop and business start-up assistant
Community Futures Organizations
• ITI, which is responsible for the Community Futures Program,
funds several fully operational Community Futures Development
Corporations (CFDC) in the NWT. The Department views this program
as a cornerstone of its economic development efforts. CFDCs are
community-based non profit organizations dedicated to support small
business development. They offer business financing through repayable
loans, general business advice and training as well as monitoring and
aftercare. The Community Futures Program has been well received by
local residents and the business community.
Government of Canada
• The Business Development Bank of Canada (BDC)
BDC offers a number of loan programs. It also has programs to assist
businesses with non-monetary problems. Industry Canada provides
support to business in a number of ways, such as providing loan
guarantees (Small Business Loans Act). Contact the Canada/NWT
Business Service Centre for more information.

• Aboriginal Business Canada (ABC)

Aboriginal Business Canada (a division of Industry Canada) offers
repayable and non-repayable contributions to business where the
majority is owned by an aboriginal businessperson. When dealing with
any of these it is best to talk to your local area Economic Development
Officer, as he/she will be aware of all the latest programs.

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10 Financial Analysis

Private Sources
Banks
The local bank of your choice or the nearest financial institution can
provide you with a wide range of information and services useful in
establishing a business. Financial assistance is their primary concern.
They are constantly in touch with the local business scene and can
provide information that is both accurate and up-to-date. The manager
can evaluate your business plan expertly and objectively, pointing out
areas that are both weak and strong. With their contacts throughout the
business community, they may be able to recommend other possible
sources of advice and information that relate specifically to your
business. In addition, many of the chartered banks provide publications,
brochures, and workbooks to assist with business planning.

Consultants
Consultants can provide you with expertise in many specific areas of
business operation and market research, but they charge for this service.
If you are planning a business that requires a great deal of technical
research then consultants, despite the cost, could be the best source of
information. Consulting services range from general business advice to
specific areas of professional expertise such as engineering or industrial.
Refer to the yellow pages of the NWT phone book and the NWT Business
Directory, available from the Canada/NWT Business Service Centre.

Accounting Firms
Accounting firms provide information related to business planning,
and in particular, financial management of your business. Many
accountants will provide an initial consultation free-of-charge (always
check first), and many of the larger or national firms also have a wealth
of printed materials available for the asking including business planning
workbooks and manuals, tax manuals, and periodic newsletters
containing business advice. To identify accounting firms that may
be able to provide assistance or publications, contact the Chartered
Accounting, Certified General Accountants’ or Certified Management
Accounting Associations.

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 Financial Analysis 10
Law firms
Like accounting firms, law firms can offer a great deal to the potential
business owner. Information available from law firms will deal with the legal
roles and responsibilities of a business, and will be able to advise on the
best form of business organization. Many law firms provide complimentary
publications and brochures on these topics, and have periodic newsletters
that you can request at no cost. To identify law firms consult your phone
book, or contact the Law Society of the Northwest Territories.

Other Sources
Private sources of advice, such as fellow businesspersons or friends with
experience in the various aspects of your business, can provide valuable
advice when planning your business. Although you may hesitate to
confide in these people they should not be ignored as possible sources
of information and advice. Most will give willingly of their time and
knowledge as long as they are approached on a private, friendly basis.

Business organizations in the NWT

There are many business associations and groups that offer advice
and seminars to members. Within the NWT, these groups include
the Chambers of Commerce, Business and Professional Women
of Yellowknife, Chamber of Mines, and Northern Manufacturers’
Association, among others.

Publications
There are a variety of publications available that offer advice and
information on establishing a business. Visit the Canada/NWT Business
Service Centre, which has an extensive library. You can also contact your
local Economic Development Office, chartered banks, accounting firms,
law firms, or a BDC office for current publications. Your local library or
bookstore will also offer a variety of books, which may be of help to you.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 85

 Terry Parker, NWT Tourism

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 Tourism Licencing 11
Tourism Licensing
• Tourism Operator Licencing
• Other Regulatory Requirements

Tourism Operator Licence

In the Northwest Territories, tourism licencing applies to guided
commercial tourism activities only. Operations such as hotels, resorts
and equipment rental companies that do not offer these types of activities
do not require a licence. Staff at any regional ITI office can explain in detail
what types of business require a licence and the process through which a
licence can be obtained. Regional staff will guide you through completing
an application, describing activities you will offer and the area in which
business will operate, payment of fees, and a mandatory consultation
period with Aboriginal organizations and other stakeholders. They can
also explain circumstances under which a licence application may be
refused.

Regional staff and the ITI website are valuable resources for information
on licencing issues such as:

• how to renew a licence

• how to amend a licence
• suspension or cancellation of licences
• Tourist Deposit Assurance Program
• Tourism Special Management Areas
Contact and website information is provided in Chapter 16 of this guide so
that you can obtain personal assistance from ITI regional tourism staff.

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11 Tourism Licencing

Other Regulatory Requirements

In addition to the tourism operator licence, there are other business
related licences that a new business venture may require before operating.
To start a new business, there are a number of government regulations
and legal requirements to fulfill. The following agencies should be
contacted to ensure compliance.

Workers' Compensation Board (WCB)

If you employ workers or carry on a business in the Northwest Territories
you must register with the WCB regardless of your home jurisdiction.
All employers who carry on business in the Northwest Territories even
temporarily must register within 10 days of commencing operation.
No industries are exempt from WCB requirements. The WCB can also
provide guidance on issues regarding Occupational Health and Safety.

Business Licence
If you intend to establish your business within a community issues its own
business licences, you must obtain a business licence from the local municipal
office. These same offices also administer permits for bingos, lotteries, casinos
and raffles.

If you intend to establish a business in a community that does not have

municipal by-laws requiring a business licence, you may still require a business
licence from the Department of Municipal and Community Affairs (MACA).
MACA also administers permits for bingos, lotteries, casinos, raffles, direct
sellers and collection agents for communities without a municipal office. Note
that MACA’s legislation provides that holders of a Tourism Operator Licence
are exempt from requiring a business licence.

Registering Your Business

All businesses, societies and cooperatives operating in the Northwest
Territories must be registered with the Department of Justice. A
business from outside of the NWT must also register an Extra-Territorial
Business Registration.

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 Tourism Licencing 11
Business Number (BN)
The Business Number is a numbering system that simplifies and
streamlines the way businesses deal with government. Not all
businesses require a BN. You only need a BN if you require one of the
following accounts:

• GST
• Payroll
• Corporate Income Tax or
• Import/Export
• Other (registered charity, excise duty, excise tax, insurance
premium tax, air travellers security tax.
More information on obtaining a business number can be found by
contacting the regional ITI offices.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 89

12 Insurance

Terry Parker, NWT Tourism

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 Insurance 12
Insurance
• Insurance: Protecting Your Business
• Risk Management

Insurance: Protecting Your Business

An important next step in your business start-up is to ensure that your
investment is protected against various risks. Your insurance company
or broker can guide you on the insurance coverage needed to safeguard
your tourism business. The following are the most commonly required
types of insurance for the tourism industry.

Commercial General Liability (CGL) Insurance insures you and your business
against claims made against you by third parties that may arise out of your
activities or operation.

Property Insurance covers losses from damage to or destruction of

business property.

Accounts Receivable Insurance insures up to 90% of your receivables

if a tour operator does not pay because of insolvency or default.
For further information, visit Export Development Canada at:
www.edc.ca.

To find out more about insurance requirements and insurance brokers,

visit the Insurance Bureau of Canada website at: www.ibc.ca/bc.asp.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 91

12 Insurance

Risk Management
A Risk Management Strategy acknowledges actual and potential threats
to the successful operation of a business and determines the activities
required to minimize or eliminate the risks. Businesses having risk
management plans and operating procedures in place could qualify
for premium reductions from their insurance company.

The Canadian Tourism Commission has published two excellent resources

to assist you with developing your risk management strategy:
• Risk Management Guide for Tour Operators
• Risk Management and Insurance Guide for the Adventure, Ecotourism
and Alpine Skiing Industries.

These in-depth resource guides can be ordered by emailing the Canadian

Tourism Commission at: [email protected] and quoting #C50128E.

Outdoor and adventure tourism operators in all Canadian provinces

and territories can now access the favourable insurance coverage and
premium rates currently enjoyed by businesses in British Columbia.
Thanks to a partnership between the Tourism Industry Association of
Canada and the Council of Tourism Associations of British Columbia
(COTA), the Tourism Industry Risk Management and Insurance Program is
being extended to tourism operators across the country.

A wide range of activities are eligible for coverage under the program,
which is administered by the Adventure Insurance Agency in conjunction
with Pinnacle Risk Management Consultants, and backed by reputable
insurers. Applicants are rated based on an expert assessment of the risk
profile of individual companies that results, in many cases, in significant
savings over other insurance options. Benefits include low minimum
premiums and deductibles, up to $5 million in commercial general liability
coverage, up to $5 million in property coverage and full protection across
North America, including suits brought in the United States.

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 Insurance 12
Applicants can enroll in the Tourism Industry Risk Management and
Insurance Program at www.adventureinsurance.ca. There, they can
download the Insurance and Risk Management Handbook, Risk
Management Plan Sample, Application for Insurance Help Guide, and
Activity-Specific Guidelines, as well as complete an online application that
will be forwarded to Pinnacle Risk Management Consultants for a risk
management review and assessment. In as little as three business days,
the Adventure Insurance Agency will contact them with a quote.

Useful Publications
In 2003, the Canadian Tourism Commission published a study
called Insurance Issues and Alternatives in the Outdoor Tourism Sector
in Canada that explored a variety of issues and made a number of
recommendations. (www.corporate.canada.travel/en/ca/research_
statistics/productknowledge/product_research/adventure_outdoor/
adventure_outdoor.html)

The CTC also produced a Risk Management Guide for Tourism Operators
that contains industry-specific management tools that can be
practically applied by businesses in all tourism sectors, and provides
risk management best practices for the tourism industry (available for
download at www.tiac-aitc.ca/english/insurance.asp).

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 93

13 Packaging The Product

Terry Parker, NWT Tourism

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 Packaging The Product 13
Packaging The Product
• Market Ready
• Pricing The Product
• Marketing To The Travel Trade

The first question to consider is whether you are in the role of a tour operator
or a services supplier. If you are the tour operator, all of the sections below will
likely apply to you. However, if you are a services supplier you will only need
to work on the sections that apply to your service. In some cases, this may be
only one component. In other cases all of the sections may apply.

Product Theme/Focus
Consumers are not likely to understand or buy a product whose theme can’t
be expressed in a few words. One word is best. However, it may be necessary
to use five or six words. If you can’t do that you need to sharpen your focus.

This doesn’t mean that all of the elements in your package have to be
the same. A package with the theme, “Experience the Best of the North”,
is short and to the point. The package could include many different
experiences – so long as they all tie back to a truly northern experience.
On the other hand a package that tries to combine golf, canoeing and bird
watching – all of which are done in the North - will lack consumer appeal.

Travel Mode(s)
Travel modes will be influenced by the type of package offered. Large
group tours will almost always use a highway coach for ground transport
or a commercial air carrier for air transport. On the other hand smaller
group tours may involve chartered aircraft, mini-bus and even watercraft.
Consider the comfort of those being transported, the reliability, safety and
quality of the transportation services.

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13 Packaging The Product

Consumer Time Commitment

Consider the length of time that your package will take. This is particularly
important if the tour package is being combined with other packages. For
example, if the tour operator already has a popular four-day package, they
may be looking for an additional three day package to round out the total
consumer time commitment to one week.
It may be important to consider how much time the consumer will need
to get from their starting point to the place where the tour package
begins. Travel agents and tour operators can be of considerable assistance
in making sure the time commitment required by the consumer will fit the
needs of the market.

Itinerary Importance
There are certain marketplaces that provide insurance against misleading
information provided on an itinerary. If a guest arrives and does not receive
what they were promised they are entitled to a full refund on their package.
It is very important to guarantee only what you can provide. It is equally
important to be very upfront with all possibilities of a tour being cancelled.
For example:
A day tour in the Nahanni is very weather dependant. Mr. Smith is
booked to go into the Nahanni on Tuesday June 15th. He arrives on Tues-
day June 15th, a beautiful sunny day in Fort Simpson, and is advised his
tour has been postponed by a day due to weather. You can well imagine
how upset he would be. Due to bad weather on Monday June 14th all
flights were cancelled and rescheduled for Tuesday. That is exactly how
it works in the Nahanni as well as many other areas of the NWT. So it is
very important to advise Mr. Smith of this possibility and actually suggest
visitors allow an extra day on the itinerary for this possible scenario.

Itinerary/Specific Activities
Work out a detailed itinerary for your product. This needs to be very
precise, so that both the consumer and suppliers of services to you know
exactly what is promised and what is expected. You will need to allow
some time to accommodate unanticipated delays.
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 Packaging The Product 13
Where start times of a tour involve the prompt arrival of scheduled aircraft
and the recovery of checked baggage, a single local activity or package
orientation session may be used as insurance against delayed flights.
Always remember that flights arriving later in the day may be somewhat
more likely to have delays.

Generally, there should be reference in your itinerary for every couple

of hours of time. Where an activity lasts more than a couple of hours it
is acceptable to restate the activity title with the word “continues.” The
itinerary reference should tell what is happening, what the consumer will
experience and any demands this may place on the consumer. Allow for
breaks to accommodate the personal needs of consumers.

Be clear that schedules will be followed and that it is the responsibility of

the consumer to be available at the specific times noted in the itinerary.

Check the sequence of activities, each element of the package should flow
naturally from one to the next.

Bundled Services
Sometimes it will be advantageous to have one supplier “bundle” a
number of services together. For example, a hotel may wish to include
meals that are selected from a predetermined menu. Or, a charter aircraft
company that is providing a day trip to a scenic area may supply food and
guiding services. In the case of buying bundled services, you may have
another negotiating point to use in determining the price that you pay the
supplier of the services.

Market Position
Market position most often refers to the demographics of your target
market. Is this a luxury package or a standard package? Meeting the
consumer’s expectations with respect to hotel rooms, meals, travel
mode, guiding and other quality-sensitive services is very important. The
consumer should not be surprised by substitutions that are not in line with
those described in the marketing promotions. Do not exaggerate.

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13 Packaging The Product

Product Name
Finally, the product name sets the tone for the entire consumer
experience. It originates with the focus of the package. But, it also needs to
consider factors like accommodation, transport mode and activities.

The right product name can have considerable impact on the consumer,
from the initial consideration of the package, to its purchase and finally the
experience itself. For example, a package could consist of visits to smaller
Dene communities with an opportunity to see traditional tanning, making
arts and crafts, sharing country foods, a visit to a special/historical site and,
depending on the weather and the insects, a night sleeping in a tipi. In
naming such a product, there is a great deal of difference between the titles
“Visits to NWT Communities” and “Close to the Land: The Way of the Dene.”

Market Ready
There are many factors that need to be considered before you can go
out and offer your product as “Market Ready.” It is important to make
sure that your product works for you, the consumer and the distribution
organization that will market your product.

Have You Market Tested The Product?

Before you attempt to promote your product to the travel trade, it is
essential that you market test it. There are a number of reasons for this.

First, very few products are ever developed without the need for
some significant adjustment. This could be a break-even cost issue, a
supplier challenge, an activity sequencing issue, a transportation or
accommodation issue, a pricing issue or a commission issue. Market
testing your product will allow you to make needed changes before you
offer it to the travel trade outside your area.

However, it may be a challenge to find enough consumers to do a market

test. There are a few options you can consider. You could work with a local
agent in your area to promote the product or it may be possible to associate
the market test of your product with another event such as a conference.

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 Packaging The Product 13
Depending on the product, you may also want to offer a scaled down
version to test the basics – for example, visiting one community rather than
three in a cultural experiences program. You may also find tour operators
who are willing to help you market test the product if you can demonstrate
that you have done a thorough job on market research, reviewed the
competition, contracted (or have commitment letters) for all essential
package components and are willing to offer an attractive commission.

What Did The Customers Think?

It is important to keep detailed information on consumer demographics
(gender, age range, city of origin, how they found out about your product,
how they booked your product and what they liked and didn’t like about
your product). You should ask your guests to complete a small survey at
the end of the package. This information can be very useful in soliciting
other operators to consider promoting your product.

Surveys that are sent home with the consumer for later return or those
mailed after the tour has been completed generate very few returns and
may tend to emphasize what didn’t work.

Did The Pricing Work?

The pricing has to work for both the consumer who bought the travel
product and for you. Talking to travel agents or tour wholesalers who
book tours into the North may provide you with some very valuable
pricing feedback.

Of course the pricing has to work for you as well. Were there unexpected
expenses that cropped up that could not be handled within the revenues
you received? Was your own mark-up adequate to cover your own
expenses and also make a profit?

Were You Able To Afford The Commissions?

Equally important to the question of how the pricing worked for you,
and for the consumer, is the satisfaction of the other partners in the
distribution chain with their commissions.

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13 Packaging The Product

If you are not able to offer a satisfactory commission level, tour operators will
not be interested in promoting or selling your product. They may choose a
competitor’s product to promote or look for others to develop a product.

It is important to start with a commission level that can be increased if

necessary. It is dangerous to start with a high commission level and then
try to reduce it in subsequent years.

What Liability Insurance Do You Carry?

Did you have any difficulty in getting affordable insurance for the travel
product you offered? Was the cost in line with your original business plan?
Were there certain elements that may have increased the premium but
could be dropped?

Pricing The Product

Pricing is the most challenging part of the process for many tour
operators – particularly for those who are new at tour packages. At the
end of the process you want something to show for all your efforts.

There are no exact pricing guidelines but we can offer you an example, using
the most common guide. All pricing is negotiable between you and the trade.

Published Prices Versus Net Prices

To begin, there is a lot of confusion about “Net Pricing”. Net pricing is any price
below your published price. Your published price is what you advertise, and
what visitors would pay if they were to buy the package directly from you.

But before you price your product, you need to determine your break
even cost. This must include all your costs. That is your time, gasoline,
insurance, and meals, anything that is going to cost you money. Once you
have determined your break-even cost then you add your profit margin, in
most cases that will be 10 to 25%. This is often called the “base price”.

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 Packaging The Product 13
Commissions
To show how the pricing works with all levels in the travel industry we
have developed an example.

If a tour operator prices their product at $100 per person (including their
profit margin), the following commissions will have to be added to the
base price depending on who is selling the product.
• Travel Agent Commission 10% – $10.00 travel agent has no middle
person they will keep the 10%
• Wholesaler Commission 20% – $ 20.00 the wholesaler will sell to the
travel agencies, they will keep 10% for themselves, they will pay the
travel agency 10%
• Booking Agent Commission 15% – $15.00 the booking agent will keep 15%
• Inbound Agency Commission 30% – $30.00 the inbound agency can
have various middle people. They will pay the wholesaler 20%, they will
pay the travel agency 10%, and the amount they earn will depend on
whom they sell to.

If you decide to partner with all sectors you need to mark up your price
between 30% and 40%. This will provide enough for all the proper
commissions.

So in the case of a tour that costs the tour operator $100 (including profit
margin) the following prices would apply:
• Partner with travel agency only – your published price would be $110
• Partner with wholesaler only – your published price would be $120
• Partner with booking agents only – your published price would be $115
• Partner with an inbound agency – your published price would be $130
If you chose to partner with all sectors your Published Price is $130.00
Your net price will now vary with each supplier.
• Your travel agent net price is $120.00
• Your booking agent net price is $115.00
• Your wholesaler net price is $110.00
• Your Inbound Agency net price is $100.00

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13 Packaging The Product

If you sell directly to a customer, your price would be the published price,
which could be one of the above, depending on who you have partnered
with to sell your product.

It is very important that you hold to your published price. For example if
you advertise your product at the $130.00 and turn around and charge the
visitor $100.00, the travel trade regards this as completely unethical and
will not want to deal with you in future.

This section of the handbook can only give you an overview of pricing.
More detailed information is available through on-line Internet courses
and tourism reference books.

Block Space/Release Dates

Block Space means that a supplier (generally a hotel or a transportation
company) allocates an inventory to a tour operator. If the tour operator
does not sell the inventory by the date that the supplier has set, they
must release any unbooked space back to the supplier. Blocking space is
essential when planning group tours.

Vouchers
Vouchers are documents that tour operators provide to their fully
independent travellers (FIT), which they turn in to the suppliers of services
that have been pre-booked by the tour operator. The client has generally
prepaid for these services.

Insurance And Liability

You will need insurance to cover the consumers who are on the tour. This
will need to be negotiated with an insurer who can assess the degree of
risk and recommend an insurance package. Rates and assessments vary. It
is always good to shop around.

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 Packaging The Product 13
You also need to be aware of your liability to ensure that travel arrangements
made at the time of booking are delivered to the traveller, exactly as sold. The
Package Travel Regulations of the European Union set the standard.

If a European consumer believes an outbound tour operator has not

delivered what was promised when they made their booking, the tour
operator may be legally required to make financial restitution to the
consumer. Suppliers may then be asked, by the outbound tour operator, to
either provide the refund or share in the cost of the refund. It should also
be noted that an upgrade provided to a consumer (better car, bigger room)
may also result in a complaint that the exact contracted services were not
supplied. If the consumer can give a reason why this was not acceptable, a
refund may be required. Any changes from the package contract need to be
agreed with the consumer, in writing, at the time of the substitution.

Marketing To The Travel Trade

What Are Tour Operators Looking For?
Tour operators look for suppliers that have competitive pricing, consistent
quality and acceptable reliability standards within their market. They prefer
suppliers who are located within the region in which the tours operate or
the services are supplied. Some products are best suited to group tours
and others to independent travellers. Some may be equally suitable to
both. Tour operators will want to know if the same (or a similar) product is
offered by their competition. In some cases this will work to the supplier’s
advantage if they see the product as essential to delivering a good
consumer experience. In other cases they may want to look for another
product to differentiate themselves from the competition.

The season or timing for the availability of your product is also important.
It is not good enough to describe the product as a summer or winter one.
Offer information about the months in which the product is available.

Finally tour operators look for suppliers who are fully licensed and insured
and understand how to work with tour operators and to service visitors,
including international visitors.

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13 Packaging The Product

The Product’s Main Selling Features

Know your product’s main selling features in relation to different target
markets. Have a clear understanding of the demographics of the target
market. Identify and describe the intended consumer experience. Assess
the uniqueness of the product or service and the degree to which it
is regarded as an essential visitor experience of your area. Identify the
experience as participatory or passive. Describe the degree of experience,
skill and any risk associated with the use of your travel product.

The Competitive Advantage Of Your Product

If similar products are offered by a number of suppliers in your area, be
ready to describe your competitive advantage. It is not enough to describe
your product as the “best”. It is important to tell exactly what advantage
your product offers over competitive products. Be prepared to name your
competition as the tour operator may want to verify with others the claims
you are making about your competition.

What Commitments Do They Expect From You?

Tour operators want to partner with suppliers who provide a superior
product at a fair price. They expect that every visitor be provided a fully
satisfactory experience. You will have to deliver what you promise.

Additionally the tour operator wants to be able to have access to the

supplier’s product inventory so that they can know how much they can
sell. They need to know if your capacity to deliver the product might
be compromised by overbooking. They prefer to have real-time access
to your product availability so that they can immediately confirm the
booking to their client. If they are willing to work with a supplier who does
not have these real time resources, they may communicate with you by
email and will need an answer to every booking inquiry within 24 hours.
This is the maximum that any good tour operator will wait.

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 Packaging The Product 13
Timing/When Do They Do Their Planning?
Tour operators plan at least 9 – 12 months in advance. Receptive tour
operators who contract services and resell them to tour operators need
even longer lead times. They may start planning 18 – 24 months in
advance. This means that suppliers who want to sell their products to
national or international tour operators must be able to provide rates and
availability information at least 12 months in advance.

In a few markets, the planning cycle is shorter as some tour operators no

longer print brochures but rely on Internet based catalogues.

If a tour operator decides to feature a product or destination, it may take

several years before the product meets sales expectations. Or, the product
may never sell. It takes patience to work with tour operators and selecting
the tour operator you want to work with is an important decision.

Working With Partners

It is important to remember that you are not usually offering your travel
product in isolation from all others. What you offer is very often sold as
part of a tour package. In that case the consumer is judging not just you,
but also the complete range of companies and organizations involved.

You want to be part of a partnership team that delivers a positive

experience that builds the reputation and credibility of all involved. Here
we are using the term “partners” in a larger sense. The organizations
involved in delivering travel products may not be legally in partnership.
But, their reputations are often treated as though they were. No matter
what your legal connection with other travel industry players, it is always
best to think of them as valued partners.

If you find that you are part of a partnership team that frequently fails to
meet consumer expectations, the reputation of your product or service
will be harmed by the poor performance of others. If that happens, look
for other partners. On the other hand if you are the one having problems,
talk to your partners and tell them what you are doing to correct the
problem and make sure it doesn’t happen again.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 105

 Terry Parker, NWT Tourism

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 Northwest Territories Tourism 14
Northwest Territories Tourism
• Marketing
• Advocacy
• Partnerships

The tourism association for the Northwest Territories, NWT Tourism, was
established in 1996 as the collective voice for the Northwest Territories
tourism industry. NWT Tourism is responsible for providing tourism
industry services and marketing programs.

NWT Tourism on behalf of the Government of the NWT, delivers the

marketing functions and is designated as the Destination Marketing
Organization (DMO) for the NWT. NWT Tourism is responsible for
pan‑territorial tourism marketing activities that includes media
advertising, production of the Explorers’ Guide, media and trade relations
and trade show attendance. The tourism association also manages the
NWT Tourism office (Tourism toll free line and fulfillment service).

Vision Statement:
To develop a dynamic partnership of industry and government in support
of our vital, viable and sustainable industry by marketing tourism and
providing support to tourism operators and communities in the NWT in a
fair and equitable manner.

Mission Statement:
To support the development of a strong tourism industry in the Northwest
Territories for the benefit of visitors, our communities and our people,
while protecting our environment and the northern way of life.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 107

14 Northwest Territories Tourism

Marketing
NWT Tourism is responsible for:
• Brand development (fit within the NWT image brand), in consultation
with the Government of the Northwest Territories (GNWT);
• Image development (in consultation with GNWT);
• Marketing strategy and plan(s);
• Marketing leverage plans;
• Marketing tactical, activity plans;
• Marketing operations:
– NWT tourism publications;
– Regional publications (shells, image controls etc);
– Web marketing (including regional web and business support);
– Visitor Information Centre marketing/promotion roles (racking,
suggestive selling training);
– Advertising and communications;
– Consumer Shows, Trade Shows, Events;
– Trade and Media Familiarization (FAM) Tours;
– Publicity and public relations.
• All other marketing/promotion activities;
• Measurement of outcomes;
• Existing Commitments and Processes (ECP) approach – project
budgeting and accountability system providing shared, ongoing data
on activities and spending;
• Measurement and reporting;
• Audit of strategy and plans;
• Execution of strategy.

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 Northwest Territories Tourism 14
Advocacy
NWTT provides leadership and raises the profile of the tourism industry
in the NWT through media and public relations and networking. They
work cooperatively with government and private sector to establish and
improve facilities, services and attractions that attract and serve tourists.
In addition, they will be strengthening relationships in all parts of the
territories in an effort to increase profitability and prosperity for the
tourism industry.

Partnerships
NWTT works with the Canadian Tourism Commission (CTC), the
governments and tourism associations in the Yukon, Nunavut, Alberta
and British Columbia. By participating and working with partners, they
can work on projects that benefit the entire NWT as a growing and vibrant
tourism destination to promote the NWT as a great place to work, play
and visit, while at the same time keep the tourism industry up to date on
the bigger picture of tourism around the world.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 109

15 Human Resources

Terry Parker, NWT Tourism

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 Human Resources 15
 
Human Resources
• Staffing:
Needs Change with the Seasons
• Training

Though many small tourism businesses are owner-operated, they almost

all need employees to support the operation of the business. Before you
hire anyone, there are many things to consider, including:
• how to recruit the right people for your business;
• compensation and salary levels;
• insurance and benefits;
• managing your staff;
• staff training;
• how to retain good workers.

You should also be aware of the current Guide to Employment Standards for
the NWT. For information, visit the Department of Education, Culture and
Employment website at: www.ece.gov.nt.ca/Divisions/Labour/PC_Guide_
to_Employment_Standards.htm

Staffing: Needs Change with the Seasons

Seasonality usually means that staffing needs will fluctuate throughout
the year. As a result, many seasonal tourism businesses rely on entry-level
staff that may not have extensive work experience or training. Employee
turnover can be high. If your business is seasonal, you will need to develop
a strategy to meet these challenges.

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 111

15 Human Resources

Recruiting Options
allnwtjobs.com
This website is a FREE website providing employers and companies
from Northwest Territories, Canada, including tourism businesses, to
post job vacancy adverts and receive free applications from candidates.
(www.allnwtjobs.com)

jobsnorth.ca
jobsnorth.ca is a new electronic labour exchange focusing on the
unique needs of job seekers and employers in the Northwest Territories.
Their aim is to give users access to resources and jobs they may not
otherwise have known of with this easy-to-use site. (www.jobsnorth.ca)

News North Classifieds

News North provides an on-line listing of all the current job postings
that appear in the six (6) newspapers it publishes – Nunavut News,
Kivalliq News, Inuvik Drum, Deh Cho Drum, NWT News/North,
Yellowknifer. (www.nnsl.com/jobs/jobs.html)

Human Resources and Social Development Canada (HRSDC)

HRSDC offers a program called Canada Summer Jobs designed to
assist full-time students in preparing for their entry into the labour
market. The program provides wage subsidies to employers, including
tourism businesses, who offer summer employment opportunities for
students aged 15 to 30 years. For further information and to obtain an
application, visit www1.servicecanada.gc.ca/en/epb/yi/yep/programs/
scpp.shtml or call 1-800-935-5555.

Canadian Tourism Human Resource Council (CTHRC)

Established in 1993, the CTHRC promotes professionalism throughout
the sector and addresses key labour market issues. Collectively, Council
members and the CTHRC bring together Canadian tourism businesses,
labour unions, associations, educators and governments to co-ordinate
human resource development activities and contribute to a sustainable,
globally competitive tourism sector. The CTHRC provides resources that

112 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Human Resources 15
include more than 50 national occupational standards as well as on-line
and paper-based training tools. (www.cthrc.ca)

Ready-to-Work
Ready-to-Work is a national skills development program designed to
assist people with transitions in the workforce. The program offers a mix
of classroom and on-the-job training that provides participants with
the skills, knowledge, attitudes, and experience required for long term,
stable employment in tourism - the world’s fastest growing industry.
Information about this program is available through the Yukon Tourism
Education Council (www.yukontec.com)

Hospitality Talent Network

The Hospitality Talent Network is a network of job boards dedicated
to the food service, hospitality, travel and tourism industries. A job or
resume posted on one job board is automatically posted on all job
boards in the network.

Employers use the job board to post foodservice, hospitality, travel and
tourism jobs and shortlist employees using Hospitality Talent Network’s
advanced profiling and matching technology. Job seekers create
profiles, attach resumes, apply for jobs, and monitor employer interest
free! (www.tourismworkweb.com)

Training
Formal training can be short- or long-term:
• a few hours of professional development training, e.g. demonstration of
how to cook a new menu item or a service excellence workshop;
• a few weeks of formal training, e.g. bartending school;
• a few months of intense training, e.g. flight attendant training school;
• several years of education, e.g. degree in Tourism Management, Master
in Tourism Marketing.

Training can occur through your employer or company. Many employers

provide on-going training in the workplace. (For example, emerit

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 113

15 Human Resources

professional certification can be offered to employees and can be done at

work.) Some companies offer both mandatory and optional professional
development courses and programs.

Training may be offered through the community or industry. Community

programs include courses and workshops, several of which are mandatory
for some occupations. For example, the Foodsafe and Workplace
Hazardous Materials Information System (WHMIS) programs, and some
workplace safety, first aid and responsible alcohol service programs, are
offered through community colleges, associations or organizations, and
may be required for some occupations or regions.

Industry programs include those offered by professional associations

and government or tourism departments, and can be anything from an
annual tourism conference to speakers, presentations or workshops. The
national, provincial and territorial tourism education councils/associations
also offer seminars, service excellence workshops, and emerit national
occupational standards, emerit certification and recognition opportunities,
and on-line training.

The Yukon Tourism Education Council (YTEC) is an organization that

addresses industry’s need for a coordinating body to undertake the
human resource issues facing the Tourism Industry in the Yukon and the
Northwest Territories. They provide training and education products to
tourism and service businesses, in an effort to enhance the growth of a
professional training culture in the industry, which leads to a stronger
workforce. YTEC works in conjunction with the Canadian Tourism Human
Resource Council. (www.yukontec.com)

YTEC is affiliated with emerit, Canada’s seal of excellence in human resource

products and services. emerit tourism training offers the finest training
resources in on-line, paper-based or instructor-led formats. Recognized
across Canada, emerit tourism training provides a diverse range of products
and programs designed to help employees and employers improve service
delivery and enhance customers’ tourism experiences.

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 Human Resources 15
Emerit offers several relevant training programs in Outdoor Adventure and
Ecotourism and in Travel. For complete information on training programs
available from emerit, visit their website at www.emerit.ca.

As part of the GNWT Tourism 2010 initiative, the Government of the

Northwest Territories contracted the Northern Learning Institute (NLI)
to develop and deliver training programs aimed at advancing training
and human resource development in the Northwest Territories tourism
industry.

The objectives of the Human Resource Training initiative detailed in

Tourism 2010 are to:
• increase the number of skilled workers in the tourism industry and
encourage development of new tourism businesses;
• help existing businesses grow;
• improve the profitability of tourism operators by providing a well-
trained workforce that will improve customer experiences; and
• increase awareness of tourism careers.

The GNWT’s training plan has been developed to:

• increase the number of skilled workers in the tourism industry;
• improve the profitability of existing tourism operators by enhancing
customer experience; and
• increase awareness of tourism careers in the NWT.

The Northern Learning Institute has developed a training plan to further

these goals and will be offering training programs through this contract
until March 31, 2011. For more details on tourism training programs
available, contact NLI tourism training staff at 867-873-3456 or website:
www.tourismtrainingnorth.com

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 115

16 Contacts and Resources

Terry Parker, NWT Tourism

116 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Contacts and Resources 16
1 Introduction
ITI Business/Economic Development Offices
North Slave Region............................................................................................... (867) 920-8967
South Slave Region............................................................................................... (867) 872-6430
Inuvik Region............................................................................................................(867) 777-7286
Sahtu Region............................................................................................................(867) 587-2900
Dehcho Region........................................................................................................(867) 695-7500

3 Key Plans
Canada/NWT Business Service Centre............................................................1-800-661-0599
www.canadabusiness.ca

5 Defining the Project

Land Administration office (INAC)...................................................................... (867) 669-2500
http://nwt-tno.inac-ainc.gc.ca/la_e.htm
Lands Administration Office (MACA).................................................................(867) 873-7569
www.maca.gov.nt.ca/lands/index.html
NWT Communities...................................www.maca.gov.nt.ca/governments/index.asp
Aklavik • Hamlet of Aklavik......................................................................................(867) 978-2361
Behchoko (Rae-Edzo) • Community Government of Behchoko........... (867) 392-6500
Colville Lake • Land Corporation...........................................................................(867) 709-2700
Deline • Charter Community of Deline.............................................................(867) 589-4800
Enterprise • Settlement Corporation................................................................. (867) 984-3491
Fort Good Hope • K’asho Got’ine Community Council..............................(867) 598-2231
Fort Liard • Hamlet of Fort Liard............................................................................(867) 770-4104
www.fortliard.com
Fort McPherson • Hamlet of Fort McPherson.................................................(867) 952-2428
Fort Providence • Hamlet of Fort Providence................................................ (867) 699-3441
Fort Resolution • Deninoo Community Council............................................ 867) 394-4556
Fort Simpson • Village of Fort Simpson.............................................................(867) 695-2253
www.fortsimpson.com
Fort Smith • Town of Fort Smith ..........................................................................(867) 872-8400
www.town.fort-smith.nt.ca

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 117

16 Contacts and Resources

Gameti • Community Government of Gameti...............................................(867) 997-3441

Hay River • Town of Hay River.................................................................................(867) 874-6522
www.hayriver.com
Hay River Reserve • Katlodeechee First Nation..............................................(867) 874-6701
Inuvik • Town of Inuvik.............................................................................................. (867) 777-8600
www.inuvik.ca
Jean Marie River • First Nation • Designated Authority.............................(867) 809-2000
Kakisa • Ka’a’gee Tu First Nation • Designated Authority.......................... (867) 825-2000
Lutsel K’e • Dene Council • Designated Authority......................................... (867) 370-3151
Nahanni Butte • Nahanni Butte Dene Band • Designated Authority
.........................................................................................................................................(867) 602-2900
Norman Wells • Town of Norman Wells . ..........................................................(867) 587-3700
www.normanwells.com
Paulatuk • Hamlet of Paulatuk ..............................................................................(867) 580-3531
Sachs Harbour • Hamlet of Sachs Harbour...................................................... (867) 690-4351
Trout Lake • Sambaa K’e Dene Band • Designated Authority......................(867) 206-2800
Tsiigehtchic • Charter Community of Tsiigehtchic........................................(867) 953-3201
Tuktoyaktuk • Hamlet of Tuktoyaktuk................................................................(867) 977-2286
Tulita • Hamlet of Tulita.............................................................................................(867) 588-4471
Ulukhaktok • Hamlet of Ulukhaktok...................................................................(867) 396-8000
Wekweeti • Dechi Laot’i First Nation................................................................... (867) 713-2010
Whati • Community Government of Whati.....................................................(867) 573-3401
Wrigley • Pehdzeh Ki First Nation • Designated Authority........................ (867) 581-3321
Yellowknife • City of Yellowknife ........................................................................(867) 920-5600
www.yellowknife.ca
Yellowknife • Yellowknives Dene First Nation (Dettah)............................. (867) 873-4307
Yellowknife • Yellowknives Dene First Nation (N’dilo)................................(867) 873-8951
Settled Land Claims
Tlicho........................................................................................................................www.tlicho.com
Sahtu.................................................................................................www.sahtu.ca/sahtulc.html
Gwich’in.................................................................................................. www.gwichin.nt.ca/LCA
Inuvialuit......................................www.irc.inuvialuit.com/about/finalagreement.html
Unsettled Land Claims

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 Contacts and Resources 16
Akaitcho (NWT Treaty 8).............................................................................www.akaitcho.info
Dehcho................................................ www.dehchofirstnations.com/negotiations.htm

6 Information Collection and Evaluation

GNWT Industry, Tourism and Investment........................................................(867) 920-3245
www.iti.gov.nt.ca/parks/index.htm
Canada/NWT Business Service Centre............................................................1-800-661-0599
www.canadabusiness.ca
NWT Community Futures office listing ......................................................... www.nwtcfa.ca
Business Development Bank of Canada .............................. 1 877 BDC-BANX (232-2269)
www.bdc.ca/en/home
NWT Business Development and Investment Corporation..................... (867) 920-6455
www.bdic.ca

7 Tourism Market Analysis

ITI, Tourism & Parks......................................................................................................(867) 920-3245
www.iti.gov.nt.ca/parks/index.htm
Canadian Tourism Exchange (web only)
....................................................................www.canadatourism.com/en/etc/etcindex.cfm
NWT Tourism ................................................................................................................(867) 873-5007
www.spectacularnwt.com
World Tourism Organization .............................................................................www.unwto.org
World Travel and Tourism Organization.......................................................www.wttc.travel
Statistics Canada................................................................................www.statcan.ca/start.html
Tourism Industry Association of Canada..........................................................(613) 238-3883
www.tiac-aitc.ca
Canadian Tourism Commission........................................... www.corporate.canada.travel
Canadian Tourism Research Institute
. .............................................................................www.conferenceboard.ca/ctri/default.htm

8 Project Site Evaluation

Sahtu Land and Water Board, Water Licence Process, and Land Use Permit Process,
Fort Good Hope...................................................................................................... (867) 598-2413
www.slwb.com
Gwich’in Land and Water Board, Land Use Permit and Water Licencing Process

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 119

16 Contacts and Resources

Guide, Inuvik............................................................................................................ (867) 777-4954

www.glwb.com
Wek’eezhii Land and Water Board, New Land Use Forms and Water Licence
Application, Wekweètì.........................................................................................(867) 713-2500
www.wlwb.ca/forms.html
Inuvialuit Environmental Impact Review Board, Environmental Screening
Committee Operational Guidelines and Procedures, and Inuvialuit Settlement
Region Community Conservation Plans, Inuvik
................................................................................................................................................ (876) 777-2828
www.bmmda.nt.ca/downloads.htm
Mackenzie Valley Land and Water Board, Land Use Permit and Water Licencing
Process, Yellowknife...................................................................................................(867) 669-0506
www.mvlwb.com
Mackenzie Valley Environmental Impact Review Board, Yellowknife
........................................................................................................................................ (867) 873-9636
www.mveirb.nt.ca
Department of Public Works and Services..................................................... (867) 669-8979
www.pws.gov.nt.ca/publications/index.htm
Department of Environment and Natural Resources.................................(867) 873-7654
www.enr.gov.nt.ca
Geological Survey of Canada..........................http://gsc.nrcan.gc.ca/map/index_e.php
GNWT Geospatial Data Warehouse
.............................................................http://maps.gnwtgeomatics.nt.ca/portal/index.jsp
Environmental Protection Division.....................................................................(867) 873-7654
www.enr.gov.nt.ca/eps/environ.htm
Prince of Wales Northern Heritage Centre...................................................... (867) 873-7551
http://pwnhc.learnnet.nt.ca/programs/archa.htm

9 Financial Analysis
NWT Business Development and Investment Corporation..................... (867) 920-6455
www.bdic.ca
Industry, Tourism and Investment list of business assistance programs
. .......................................................................www.iti.gov.nt.ca/iea/business/busprog.html

10 Tourism Licensing
ITI Regional Offices.............................................www.iti.gov.nt.ca/regions/addresses.htm

120 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Contacts and Resources 16
North Slave Region • Yellowknife....................................................................(867) 920-3230
South Slave Region • Fort Smith..................................................................... (867) 872-6430
Dehcho Region • Fort Simpson........................................................................(867) 695-7488
Inuvik Region • Inuvik...........................................................................................(867) 777-7353
Sahtu Region • Norman Wells........................................................................... (867) 587-3531
Workers’ Compensation Board.......................................................................... 1-800-661-0792
www.wcb.nt.ca
Consumer Affairs..........................................................................................................(867) 873-7125
www.maca.gov.nt.ca/resources/licensing/index.html
Legal Registries............................................................................................................1-877-743-3302
www.justice.gov.nt.ca/CorporateRegistry
Business Number (BN)............................................................................................ 1-800-959-5525
www.cra-arc.gc.ca/tax/business

12 Insurance
Export Development Canada............................................................................. 1-866-283-2957
www.edc.ca
Insurance Bureau of Canada.................................................................................1-800-377-6378
www.ibc.ca
Canadian Tourism Commission...........................................................................(604) 638-8300
www.corporate.canada.travel

15 Staffing
Recruiting Options: ..................................................................................... www.allnwtjobs.com
www.jobsnorth.ca
News North Classifieds..............................................................................................(867) 873-5924
www.nnsl.com/jobs/jobs.html
Human Resources and Social Development Canada...............................1-800-935-5555
www1.servicecanada.gc.ca/en/epb/yi/yep/programs/scpp.shtml
Canadian Tourism Human Resource Council (CTHRC)..............................(613)-231-6949
www.cthrc.ca
Yukon Tourism Education Council.......................................................................(867) 667-4733
www.yukontec.com
Hospitality Talent Network.........................................................www.tourismworkweb.com
emerit.............................................................................................................................. www.emerit.ca
Northern Learning Institute...................................................................................(867)-873-3456
www.tourismtrainingnorth.com

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 121

16 Contacts and Resources

Federal
Indian and Northern Affairs Canada......................................................www.ainc-inac.gc.ca
Industry Canada..............................................................................................................www.ic.gc.ca
Statistics Canada.......................................................................................................www.statcan.ca
Department of Fisheries and Oceans....................................................www.dfo-mpo.gc.ca
Canadian Tourism Commission............................................www.corporate.canada.travel
Transport Canada........................................................................................................... www.tc.gc.ca

Territorial
ITI, Tourism & Parks......................................................................................................(867) 873-7903
www.iti.gov.nt.ca/parks/index.htm
NWT Tourism..................................................................................................................(867) 873-5007
www.spectacularnwt.com
Municipal and Community Affairs.........................................................www.maca.gov.nt.ca
Aurora College........................................................................................www.auroracollege.nt.ca

Chambers of Commerce
NWT Chamber of Commerce................................................................................ (867) 920-9505
www.nwtchamber.com
Yellowknife Chamber of Commerce..................................................................(867) 920-4944
www.ykchamber.com
Hay River Chamber of Commerce........................................................................(867) 874-2565
www.hayriverchamber.com
Inuvik Chamber of Commerce.............................................................................. (867) 777-8600
www.inuvik.ca
Norman Wells Chamber of Commerce ............................................................(867) 587-3700
www.normanwells.com/business/index.html
Fort Smith........................................................................................................................(867) 872-4213

122 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES

 Sources 17
Sources
Terry Parker, NWT Tourism

TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES – 123

17 Sources

A Guide for Tourism Business Entrepreneurs. British Columbia Ministry of

Tourism, Sport and Arts. nd

How to Start a Business in the NWT. Canada/NWT Business Service Centre.

April 2002

Market Ready: The NWT Tourism Handbook. NWT Tourism and Indian and
Northern Affairs Canada. nd

Passages to Innovation: A Dynamic Interactive Planning Tool for Tourism

Product Developers in Canada. Canadian Tourism Commission. 2003

Tourism 2010: A Tourism Plan for the Northwest Territories. Department of

Industry, Tourism and Investment, GNWT. nd

Tourism Development Handbook for Alberta. Alberta Economic

Development, Tourism Development Branch. October 2002

124 – TOURISM DEVELOPMENT HANDBOOK FOR THE NORTHWEST TERRITORIES