8th Air Force MuseumBarksdale Air Force Base

Feasibility Study

Researched & prepared by:Don MolnerAntoine PeterIngo Willems

OVERVIEW Framework and Scope

Research

Findings

Concept and Features

Financials

Recommendations

Project FrameworkConducted for 8 AFMAMaxims:

1. Configuration should enable suitable revenue generating features to cover operations and sustainment costs.

2. Configuration and features should enable suitable capital fund raising justification. No long term debt!

3. If 1 or 2 cannot be accomplished, the project is considered not feasible.

Not about specific exhibit choices or displaysMethodology: Background…VIP meeting…

Concept Drawings…MU leadership vision…visits/interviews

Project Logic Map and Scope

YN

START$X Funds

APPROVE PROJECT

STOP PROJECT

Alt funding solutionsavailable

Secure alt funding solutions

$E= Economic Impact to

local/state/fed

E Determines funds justification from Each lvl of gov’t

Drives total capital funding input $F

Is F ≥ X?Y

N $Rev/visok to cover

cost C?

Y determines # of visitors/participants to

gen rev to cover costs C

Drives operations &sustainment costs C

Provides a certain facility /staff with

features Y

Community impact

sufficient?Add feature

Increase fund X with cost of new feature

N

Y

N

Y

ResearchQuestionnaires for top management

Met w/ leadership at 23 MU entities US & Europe

On-line survey to stakeholders

Professional publications/research studies; articles;

web-based sources – AAM, AFA, SBCTB

Quantitative data research

SWOT Analysis, Market Analysis, Financial Analysis

Key FindingsCommonalities of successful museums

Revenue generators, features and events

Visitor dynamics

Addressable market

Visitation Trend

Dynamics of future museum

Commonalities of Successful MuseumsThe role of marketing

Fully leveraged the institutions' assetsAdopted a customer focusHad profound understanding of themselves and

the market Sought to understand customer needs Knew their marketplace and competitors Understood core competencies; things that made them

uniqueBuilt strategy around core competencies

Museum managed like a business entity

Revenue Generators / Features and EventsDynamicInteractiveAn experience you can’t have at home and

one that differentiates from competing attractions

S-B Visitor Dynamics

Purpose of Trip0%

20%

40%

60%

80%

100%

120%

74%

26%

OtherLeisure

Overnight Stays0%

20%

40%

60%

80%

100%

120%

73%

27%

NoYes

Travel Party Size (in average 2.35)0%

20%

40%

60%

80%

100%

120%

41%

44%

15%

3+TwoOne

Addressable MarketAddressable Market – Target Number of Visitors

Shreveport-Bossier Area nbr/% SourceNumber of rooms 9.963 2011 SBTC Lodging Report pg 4

Occupancy rate 74% 2012 SBTC Economic Indicator Report pg 1

Purpose – Leisure 74% 2010 TNS Study Louisiana pg 26Market Capture Rate 10% Multiple - AMA & targets from comparative MU's

Total Number of individuals 3,542,400 Visiting people overnight in B-S per year

Day trippers 1,310,203 Visitors coming to the region for the day

Total people to S-B area 4,852,603 People coming to S-B per year

Number Just Passing Through 176,412 Factoring out those just passing through

TOTAL S-B VISITOR MARKET 4,676,191 Includes all segments (Business, Leisure, etc)

Total of segmented Markets 3,460,382 Those various graphics seeking leisure activity

Visitors Captured 346,038 Based on 10% market capture rate

Visitation Trend

Steady-State

No re-investment: Visitors go elsewhere

Optimal: Gain Market Share

# Visitors

Upgrade Add New Features

Year 1 Year 2 Year 3 Year 4 Year 6 Year 8

Dynamics of Future MuseumSocial hub – where people spend quality timeBridged the gap/link between history and

futureEdutainment: Flexibility to educate and

entertain

Museum ConceptReach the “wow” effect – nationally

recognizedFacility for stewardship - aircraft

in-doors/exhibitsHonor the past and look to the futureEd program focused on i-STEMOperate and sustain w/ revenue generating

features

Museum Features•Donations•Retail Operations•On-base Tour•Simulator•Food Concession•Events•Pro Cockpit Pictures

•Educational Activities•Permanent Exhibits•Temporary Exhibits•Maint & Industrial Facility•Brick Program•Membership

Financial Projections Revenues

Year 1 Year 2 Year 3 Year 4 Year 5

Number of visitors 327 000 363 300 346 000 346 000 346 000

Volountary donations (net) 1 226 250 1 362 375 1 297 500 1 297 500 1 297 500 Membership (net) 37 500 56 250 75 000 93 750 112 500 Food concessions (Net) 186 384 203 127 195 148 195 148 195 148 Events (Net) 63 525 63 525 63 525 63 525 63 525 Museum store sales (Gross) 981 000 1 089 900 1 038 000 1 038 000 1 038 000 Online store (Gross) 63 198 70 213 66 870 66 870 66 870 Simulator 392 400 581 280 553 600 553 600 553 600 On-base tour 490 500 544 950 519 000 519 000 519 000 Bricks program (net) 9 500 9 500 9 500 9 500 9 500 Cockpit pictures 130 800 145 320 138 400 138 400 138 400 Exhibits sponsorships 200 000 200 000 200 000 200 000 200 000 Education activities 51 840 51 840 103 680 103 680 103 680

Total revenues 3 832 896 4 378 280 4 260 222 4 278 972 4 297 722

Financial Projections Expenses

Expenses Year 1 Year 2 Year 3 Year 4 Year 5Operations Programs and education 51 840 51 840 103 680 103 680 103 680

Museum store 562 900 617 350 591 400 591 400 591 400 Online store 31 599 35 107 33 435 33 435 33 435 Simulator 65 038 130 520 130 308 130 308 130 308 On-base tour 95 014 95 014 95 014 95 014 95 014 Cockpit pictures 46 838 46 838 46 838 46 838 46 838 Exhibits and collections 300 000 430 000 430 000 430 000 430 000

Other Administration 1 312 630 1 496 680 1 496 680 1 496 680 1 496 680 Building 796 600 796 600 796 600 796 600 796 600 Dvpmt and marketing 483 290 537 828 526 022 527 897 529 772

Total expenses 3 745 749 4 237 777 4 249 978 4 251 853 4 253 728

Financial Projections Summary

Income From Operating Activities

 

             

Year 1 Year 2 Year 3 Year 4 Year 5 AvgAvg $/Vis

Number of Visitors 327,000 363,300 346,000 346,000 346,000 345,660 

Total Revenues $3,832,896 $4,378,280 $4,260,222 $4,278,972 $4,297,722 $4,209,618 $12.18

Total Expenses $3,745,749 $4,237,777 $4,249,978 $4,251,853 $4,253,728 $4,147,817 $12.00

Net Operations $87,147 $140,503 $10,244 $27,119 $43,994 $61,801 $0.18

$/visitor $0.27 $0.39 $0.03 $0.08 $0.13

 Line of Liquidity (#vis) 247,000 276,000

275,000 273,000 271,000

Capital RequirementsInitial Capital Requirements Estimate

  Size Cost    

Main Building 148300 $235 $/sqft $34.850.500Rooms for education center 10400 $220 $/sqft $2.288.000

26 rooms w/bath; 400sq ft ea.        Aircraft Hangar/Industrial area 36000 $240 $/sqft $8.640.000Memorial Walkway       $1.500.000

Total construction cost     $47.278.500       

Exhibits     est $15.000.000Aircraft restoration & relocation       $3.500.000Fabrication, lab, test cell, machinery       $2.500.000Furniture, fixtures and office equip   7.5%   $3.545.888Professional fees and expenses.   15%   $7.091.775

Theater, auditorium, IT equip       $1.500.000

Food services equip/banquet furnishing       $800.000

Infrastructure capital required       $81.216.163         

Flight simulator 1  Unit $156.000Tram for base tour 1  Unit $250.000Cockpit pictures 1  Unit $30.000

Attractions capital required       $436.000

Total initial capital required       $81.652.163Union Labor   20%  $16.243.233Cost Overrun 50% $40.826.081

Project Logic MapGM

Dir Fin & Bud

Sen Acct

Grant Writer

Dir Mrkt & Bus Dev

Mrkt Spec Retail Mngr

Mrkt Spec ConcessMngr

Events Coord

Event Asst’s- V

Dir Staff & Ops

Fac/Sec Mngr

Sec Guard’s

Sim Oper

Janitor H-keep

Grnds Mx

Acft MxSup

AcftTech’s - V

Comp & IT Mngr

IT Spec

Vol Coord

Tour Driver

Tour Guides - V

Recept’s -V

G-Shop -V

Archive's -V

Exhibit’s -V

Dir Ed

Ed Spec

Ed Spec

Instruc’s -V

Research Asst’s - V

Admin Mngr

Admin Asst

8th AF Museum Association Staff

2 BW DS

MU Dir

Curator Ops Supt

8th AF Museum

Recommended Organizational Alignment and Relationships

8 AFMA BOD

VOLUNTEER POSITIONSNote: MU Director is required by USAF requirements to be the Volunteer Program Administrator; have oversight of Volunteer Coordinator; ensure mandates are complied with.

Year 1

Year 2

Potential Outsource

Volunteer

Economic Impact

Total Economic Impact 5-Yr Avg

Full-Time Equivalent Jobs 386,67

Total Expenditures $12.419.721

Resident Household Income $8.930.180

Local Government Revenue $593.856

State Government Revenue $750.119

Part of a $512M economic activity sector supporting 5122 jobs in the region

SummaryWith the right composition of a dedicated and

business savvy group of people, coupled with

the right strategy, there is no logical

argument to support saying that this new

proposed museum cannot be built to

premiere status and prosper.

RecommendationsRe-confirm the dedication is present to move forward

Gain consensus on museum features & exhibit concept

Market new MU proposal and bolster Advisory Board

Obtain seed $ to finance and hire capital fundraising

campaign team (@$350K/yr for 3 years)

An ineffective/unsuccessful capital campaign = no-go

?

Backups

Financial projectionsFood concessions

Year 1 1 1 1 Year 1 Year 2 Year 3 Year 4 Year 4Quarter 1 2 3 4

OperationsVisits

Number of visitors 75 210 81 750 81 750 88 290 327 000 363 300 346 000 346 000 346 000 Opening time of the activity

Operating hours 724 724 724 724 2 896 2 896 2 896 2 896 2 896 Operating hours per day 8 8 8 8 8 8 8 8 8

Number of days 90,5 90,5 90,5 90,5 362 362 362 362 362Lunch meals

Avg cost of lunch meal 10 10 10 10 10 10 10 10 10 10Visitors

percentage visitors buying lunch meal 20% 20% 20% 20% 20%Number of visitors buying a lunch meal 15 042 16 350 16 350 17 658 65 400 72 660 69 200 69 200 69 200

Number of lunch meals per day for visitors 166 181 181 195 181 201 191 191 191External people

opening days for additional people 260 65 65 65 65 260 260 260 260 260add people coming for a lunch meal 50 3250 3250 3250 3250 13 000 13 000 13 000 13 000 13 000

Number of lunch meals per day for external people 50 50 50 50 50 50 50 50 50Total number of lunch meals 18 292 19 600 19 600 20 908 78 400 85 660 82 200 82 200 82 200

Number of lunch meals per day in working days 216 231 231 245 231 251 241 241 241

B-fast/snack/sweet/bevAvg Cost BSSB 3,5 3,5 3,5 3,5 3,5 3,5 3,5 3,5 3,5 3,5

Visitors

Percent buying B-fast/snack/sweets/Bev 5% 5% 5% 5% 5% 5% 5% 5% 5% 5%Number buying BSSB 3 761 4 088 4 088 4 415 16 350 18 165 17 300 17 300 17 300

Number BSSB per day for visitors 42 45 45 49 45 50 48 48 48External people

opening days for additional people 260 65 65 65 65 260 260 260 260 260Number of BSSB meals for external people 30 1 950 1 950 1 950 1 950 7 800 7 800 7 800 7 800 7 800

Number of BSSB meals per day for external people 30 30 30 30 30 30 30 30 30Total number of BSSB meals 5 711 6 038 6 038 6 365 24 150 25 965 25 100 25 100 25 100

Number of BSSB meals per day in working days 72 75 75 79 75 80 78 78 78

RevenuesNet profit margin on Meals 20%

Average earning per lunch meal (Net) 2,0$ 2,0 2,0 2,0 2,0 2,0 2,0 2,0 2,0 2,0 Average earning per B-fast meal (Net) 0,7$ 1,2 1,2 1,2 1,2 1,2 1,2 1,2 1,2 1,2

Profit $ 43 579 46 596 46 596 49 613 186 384 203 127 195 148 195 148 195 148

Lunch meals 156 800 171 320 164 400 164 400 164 400 BSSB 29 584 31 807 30 748 30 748 30 748

Financial projectionsSimulator

Year 1 1 1 1 Year 1 Year 2 Year3 Year4 Year5Quarter 1 2 3 4

OperationsNumber of visitors 75210 81750 81750 88290 327 000 363 300 346 000 346 000 346 000

Opening time of the activityOpening time of simulator/opening time of museum. 90% 90% 90% 90% 90% 90% 90% 90% 90% 90%

Opening hours of simulator per day 7,2 7,2 7,2 7,2Total opening hours of simulator 651,6 651,6 651,6 651,6 2 606 2 606 2 606 2 606 2 606

Visits 23%Capture rate 15% 15% 15% 15% 15% 15% 20% 20% 20% 20%

Number of visitors on max flight 11 282 12 263 12 263 13 244 49 050 72 660 69 200 69 200 69 200

Occupancy rate Max number of visitors per run 2 2 2 2Number of simulators 1 1 1 1 1 1 2 2 2 2

Rides per hour per simulator 12 12 12 12 12 12 12 12 12 12Maximum number of visits per hour 24 24 24 24

Maximum visits per day 173 173 173 173Maximum number of visits 15 638 15 638 15 638 15 638 62 554 125 107 125 107 125 107 125 107

Occupancy rate 72% 78% 78% 85% 78% 58% 55% 55% 55%

SalesPrice for one individual run $8 8 8 8 8 8 8 8 8 8

Sales 90 252 98 100 98 100 105 948 392 400 581 280 553 600 553 600 553 600

ExpensesInitial investment Equipment 150 000

Installation 6 000

Lifetime (yrs) 5

Residual value after lifetime 20 000 Wear-out and replacement cost 2 267 6 800 6 800 6 800 6 800 27 200 54 400 54 400 54 400 54 400

Direct Labor costsN° of operators needed 1 1 1 1 1

Unit labor cost 12,5 12,5 12,5 12,5 12,5Working hours 1,1 717 717 717 717 2 867 2 867 2 867 2 867 2 867

Total direct labor costs 8 960 8 960 8 960 8 960 35 838 71 676 71 676 71 676 71 676

Maintenance costs costs 2 000 460 500 500 540 2 000 4 444 4 232 4 232 4 232

Total Costs 16 220 16 260 16 260 16 300 65 038 130 520 130 308 130 308 130 308

Profit 74 033 81 841 81 841 89 649 327 362 450 760 423 292 423 292 423 292

Example of revenue calculationFully interactive simulator that can perform 360° motion (Two seats).

SimulatorYear 1 1 1 1 Year 1 Year 2 Year3 Year4 Year5Quarter 1 2 3 4

Number of visitors 75210 81750 81750 88290 327 000 363 300 346 000 346 000 346 000 Opening time of simulator/opening time of museum. 90% 90% 90% 90% 90% 90% 90% 90% 90% 90%

Opening hours of simulator per day 7,2 7,2 7,2 7,2Total opening hours of simulator 651,6 651,6 651,6 651,6 2 606 2 606 2 606 2 606 2 606

Visits Capture rate 15% 15% 15% 15% 15% 15% 20% 20% 20% 20%Number of visitors on max flight 11 282 12 263 12 263 13 244 49 050 72 660 69 200 69 200 69 200

Occupancy rate Max n° of visitors/run 2 2 2 2 2 2 2 2 2Number of simulators 1 1 1 1 1 1 2 2 2 2

Rides per hour per simulator 12 12 12 12 12 12 12 12 12 12Maximum number of visits 15 638 15 638 15 638 15 638 62 554 125 107 125 107 125 107 125 107

Occupancy rate 72% 78% 78% 85% 78% 58% 55% 55% 55%

Price for one individual run $8 8 8 8 8 8 8 8 8 8Sales 90 252 98 100 98 100 105 948 392 400 581 280 553 600 553 600 553 600

Initial investment Equipment 150 000

Installation 6 000

Lifetime (yrs) 5

Residual value after lifetime 20 000 Wear-out and replacement cost 2 267 6 800 6 800 6 800 6 800 27 200 54 400 54 400 54 400 54 400

Direct Labor costs N° of operators needed 1 1 1 1 1Unit labor cost 12,5 12,5 12,5 12,5 12,5

Total direct labor costs 8 960 8 960 8 960 8 960 35 838 71 676 71 676 71 676 71 676 Maintenance costs costs 2 000 460 500 500 540 2 000 4 444 4 232 4 232 4 232

Total Costs 16 220 16 260 16 260 16 300 65 038 130 520 130 308 130 308 130 308

74 033 81 841 81 841 89 649 327 362 450 760 423 292 423 292 423 292

Op

erat

ion

sS

ales

Exp

ense

s

Profit

Fixed Salary Breakdown      

PositionYearly Salary

Received

Bonus & Incentives

Tax and Admin

Component (25%)

Budgeted Amount

LA Avg Annual Salary*

Shreve Avg

Annual Salary*

Occupational Code

General Manager $85,000 $20,000 $26,250 $131,250 $87,253 $89,013 11-1021Dir of Fin & Budget $65,000 $15,000 $20,000 $100,000 $75,743 $76,423 11-3031Dir Mrkt and Bus Dev $65,000 $15,000 $20,000 $100,000 $76,914 $71,769 11-2021Dir of Staff & Ops $65,000 $15,000 $20,000 $100,000 $66,033 $60,345 11-9199Dir of Ed $65,000 $15,000 $20,000 $100,000 $54,343 $49,216 11-3042Comp & IT Mngr $60,000   $15,000 $75,000 $80,047 $69,585 11-3021Senior Acct $50,000   $12,500 $62,500 $53,010 $47,938 13-2011IT spec $50,000   $12,500 $62,500 $54,506 $47,893 15-1071Grant Writer $45,000 $10,000 $13,750 $68,750 $44,671 $46,394 13-1199Ed Spec $40,000   $10,000 $50,000 $41,369 $40,581 25-2022Ed Spec $40,000   $10,000 $50,000 $41,369 $40,581 25-2022Mrkt Spec $40,000 $10,000 $12,500 $62,500 $39,289 $42,881 19-3021Mrkt Spec $40,000 $10,000 $12,500 $62,500 $39,289 $42,881 19-3021Facility/Security Mngr $40,000   $10,000 $50,000 $41,048 $38,694 33-1099Admin Mngr $40,000   $10,000 $50,000 $37,604 $38,113 43-1011Retail Store Mngr $35,000   $8,750 $43,750 $33,727 $35,087 41-1011Admin Asst $30,000   $7,500 $37,500 $33,148 $31,941 43-6011Vol Coordinator $30,000   $7,500 $37,500 $30,777 $31,279 43-4161Concession Mngr $30,000   $7,500 $37,500 $26,362 $26,672 35-1012Events Coord $25,000   $6,250 $31,250 $28,100 $25,314 43-9199TOT FIXED SALARY Year 1       $1,137,500      TOT FIXED SALARY Year 2+       $1,312,500                     

Variable SalaryHourly

Rate

Projected Annual Hours

first year

Tax and Admin

Component (25%)

Budgeted Amount

LA Avg Hr Wage*

Shreve Avg Hr Wage*

Occupational Code

Sim Operator $10.00 2867 $7,168 $35,838 $7.26 $7.44 39-3091

Aircraft Mx Tech $20.00 2000 $10,000 $50,000 $22.95 $23.55 49-3011

Security Guard $10.00 3248 $8,120 $40,600 $10.57 $9.44 33-9032

Housekeeping $8.00 32580 $65,160 $325,800 $7.47 $6.86 37-2012

Tour Driver $10.00 1448 $3,620 $18,100 $10.81 $9.64 39-6021

Grounds Mx $10.00 2080 $5,200 $26,000 $9.89 $9.49 37-3011

Photo assistant $10.00 2867.04 $7,168 $35,838 $12.37 $13.65 27-4021

Educator $20.00 960 $4,800 $24,000 NA NA 25-2022

TOTAL VAR SALARY       $496,338      

               

Expense Accounts Annually            

Aircraft/Asset Maint $80,000            

Marketing $200,000            

Administrative $50,000            

Travel $50,000            

Uniform/Clothing $5,000            

Total Exp $385,000            

TOTAL EXPENSES       $2,018,838      

Volunteer Positions              

Tour dir              

Tour Guide/driver x 8              

Receptionist x 8              

Gift Shop x 5              

Docent x 15              

Total              

*Source: Louisiana Occupational Employment Wage Survey