Project Green Parks
Client Situation
The client was the owner and operator of c. 30 holiday parks across Europe. PwC was engaged to perform a Vendor Due Diligence and the Deal Analytics Technology Services team supported the Financial Due Diligence team in analyzing the key drivers of revenue.
The company had realized a significant increase in the average price per booking over the past 3 years, and management indicated that this was largely due to price increases and earlier bookings (longer lead time).
The company indicated that it wanted to increase its share in customers with certain geographic background going forward, as they believed these customers had higher on-park spending.
Approach
We presented the client with a tailored methodology, as well as financial and commercial analytics of the revenue and product performance, to efficiently get an insight into the target’s performance and suitability of the transaction.
Using mainly SAS and Tableau, we analyzed a total of 12m transaction entries, amounting to 1.2m individual bookings.
We performed an extensive price-volume analysis, looking at the impact of accommodations rented out (size, duration per rental, seasonality, geography and average rental price per night). We also examined the impact of the average lead time on booking price with multivariate regression, correcting for the above-mentioned price drivers. Additionally, we looked at on-park spending (restaurants, recreation, etc.) and the impact of different customer groups on this spending. Lastly, we analysed customers’ stickiness.
Value Impact
We were able to create insights into price and volume development, previously unavailable to management. With this, we were able to largely corroborate management’s statement that its revenue had increased due to price increases and lead time increases.
There were a few underlying mix effects that also impacted the average revenue per booking. We were also able to prove that the customer geographic background had little impact for on-park spending, and were able to provide comfort with regard to the percentage of returning customers.
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