Tourism Review

An examination of a social tourism business in Granada, Nicaragua

Alexia Franzidis,
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 An examination of a social tourism
business in Granada, Nicaragua
Alexia Franzidis

Abstract Alexia Franzidis is Assistant

Purpose – The purpose of this paper is to examine the business model of a successful social tourism Professor of Recreation,
business in Granada, Nicaragua. The study assesses how the business provides an avenue to combat Sport Leadership and
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the challenges that restrict certain stakeholders from participating in tourism. The case identifies specific Tourism Management at
mechanisms, such as investing in the local community’s education and favoring local vendors and School of Health and
merchants, as ways in which social tourism businesses can disseminate value among all stakeholders
Applied Human Sciences,
and create a more equitable form of tourism.
College of Health and
Design/methodology/approach – The case study method was chosen for collecting and analyzing Human Services, University
data. Data include in-depth interviews with business founders, managers and employees, field
of North Carolina,
observation notes, photographic documentation and additional written documents. Data were analyzed
Wilmington, North Carolina,
using content analysis.
USA.
Findings – The study found that the business was able to produce a high-quality tourism product that
disseminated value among all stakeholders. The study also proved the value of the additional building
blocks within the Business Model Canvas for Social Enterprise, and the clear distinction between ‘‘co-
creators’’ and ‘‘beneficiaries.’’
Originality/value – This study uses the Business Model Canvas for Social Enterprise, a model unverified
since inception, to analyze a successful social tourism business. It confirms the usefulness of the
additional building blocks within the model, and the additional delineations between ‘‘co-creators’’ and
‘‘beneficiaries.’’ Furthermore, the paper recommends these distinctions are extended to all blocks in the
canvas, to illustrate the many ways a company can distribute value based on its business model.
Keywords Community involvement, Tourism impacts, Social tourism business,
Social tourism enterprise
Paper type Case study

Introduction
Tourism has been lauded as an “economic” and “social phenomenon” (UNWTO, 2016). Its
continued growth has made it one of the most prominent commercial sectors in the world,
creating employment opportunities, increasing household income and stimulating regional
development through the construction of infrastructure and facilities (UNWTO, 2006). In less
economically developed countries (LEDCs), tourism is often seen as one of the few feasible
options for development that creates opportunities for business (Briedenhann and Wickens,
2004; Swarbrooke, 2005), as it can be easier to establish and is more cost efficient than
other forms of rural economic development strategies (Wilson et al., 2001). However, many
of the positive benefits cannot be enjoyed if it is not developed or managed in a sustainable
manner. Due to a scarcity in human capital, many local authorities in LEDCs rely heavily on
foreign skills and finance to develop tourism facilities. Through profit repatriation, the
employment of foreign nationals, the purchase of imported infrastructure and the
consumption of foreign products, much of the earnings can leak out into other economies Received 11 April 2017
Revised 15 August 2017
(Smith and Jenner, 1992). Furthermore, many development projects tend to be elitist in 21 October 2017
including representatives from selected groups (Jewkes and Murcott, 1998), and may only Accepted 29 October 2017

DOI 10.1108/TR-04-2017-0076 © Emerald Publishing Limited, ISSN 1660-5373 j TOURISM REVIEW j

 seek collaboration between those groups who have compatible goals, resources or skills
(Bramwell and Sharman, 1999). Remaining actors, such as community residents, are left in
seasonal or low-paying positions (Jewkes and Murcott, 1998).
To combat these conditions social tourism businesses have emerged to create added value
to individuals, communities and the environment (Poon, 2011). These organizations
combine profit-making goals with social objectives, and give tourism businesses the
opportunity to distribute benefits equitably between all stakeholders. Such initiatives have
been found to combat economic challenges, enhance capacity building, empower
community members and provide long-term benefits for all actors (Iorgulescu and Ra
var,
2015). These businesses have also received attention and increased demand from
customers, with studies confirming enhanced customer loyalty, satisfaction and increased
brand image (Choi and Kim, 2013).
While this type of business has proven beneficial and is attracting academic attention, the
number of studies that examine a social tourism business’s operational methods is limited
(Iorgulescu and Ra
var, 2015). Researchers have recommended further investigation into
the effective methods and tools of current organizations, as the findings would create
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shared knowledge on how to adopt more equitable and inclusive business models
(Michelini and Fiorentino, 2012).
This paper aims to enhance the existing literature by examining a successful social tourism
enterprise in Granada, Nicaragua. It uses a newly proposed model, the Business Model
Canvas for Social Enterprises (Qastharin, 2014), to assess how a successful social tourism
business disseminates value among stakeholders and dismantles the barriers that typically
restrict certain stakeholders from benefiting from or participating in tourism.

Social enterprises
Social enterprises have been recognized as key actors in helping achieve developmental
goals (Nelson, 2012). They are typically founded as a response to the unfavorable
economic, social, cultural and/or ecological environments found in LEDCs (Aziz and El
Ebrashi, 2016). These conditions are an opportunity for organizations to provide value to
underserved populations and create a “transformational impact” (Aziz and El Ebrashi, 2016,
p. 1541). This goal often shapes “the mission value propositions and target segments
blocks of the business model” (Aziz and El Ebrashi, 2016, p. 1541). Social tourism
businesses are noted as one type of business that can help to overcome the development
issues faced by societies (Hall and Kirkpatrick, 2005). If managed successfully, tourism
enterprises can provide professional, vocational and entrepreneurial training to develop
residents’ skills (Echtner, 1995), enhance capacity building and offer support and additional
resources that may otherwise be unavailable (Scheyvens, 2002).

Business models
Business models provide a means to describe the way in which companies function
(Osterwalder and Pigneur, 2010). The term gained popularity in the 1990s due to its use in
digital technology and e-business companies (Osterwalder, 2004), but has since been
expanded to include other types of organizations (Zott et al., 2011). There are now a
plethora of articles, each offering slight variations in conceptualization and definitions
(Casadesus-Masanell and Ricart, 2010). Authors have referred to business models as “the
content, structure, and governance of transactions designed [. . .] to create value through
the exploitation of business opportunities” (Amit and Zott, 2001, p. 511), and a “means to
describe and classify businesses” (Baden-Fuller and Morgan, 2010, p. 156).
Despite these variations, many agree that business models offer a clear yet generalized
description of how an “organization functions in achieving its goals” (Massa et al., 2016,

j TOURISM REVIEW j
 p. 73). The definition adopted by this paper comes from Osterwalder and Pigneur’s (2010)
pinnacle text: “a business model describes the rationale of how an organization creates,
delivers, and captures value.” This definition is used because it is “easily understood and
communicated” (Shafer et al., 2005, p. 202), facilitates value-added analysis (Sanderse,
2014), and enables a broader understanding of value (Zott et al., 2011). It can also be used
as a basis to develop a business model canvas[1] for use in analyzing a wider variety of
organizations (Sanderse, 2014). It comprises nine building blocks: customer segments,
value proposition, channels, customer relationships, revenue streams, key activities, key
resources, key partner and cost structure.
As companies have continued to evolve, variations of business models have emerged to
reflect these changes. One example of an alternative business which has grown over the
years, mirroring a societal shift, is social enterprises. Such businesses fall between for-profit
and non-profit organizations (Michelini and Fiorentino, 2012). They operate with a similar
structure as a for-profit business, with products, services, customers, markets, expenses
and revenues; they strive to be financially self-sustaining (Yunus et al., 2010); however,
surplus profits are invested to achieve a specific social mission or objective (Yunus et al.,
2010), and the profits determine the impact of the social initiative (Bull and Crompton,
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2006).
As the primary purpose of social enterprises is to serve society (Yunus et al., 2010, p. 311),
and their success is measured by their social outcome, their business models differ from
conventional for-profit business models (Yunus et al., 2010, p. 312). They contain the
conventional components found within for-profit business models, but they also include all
stakeholders and the social objective (Yunus et al., 2010). As with for-profit businesses,
variations of social business models have grown and the specificities of the social business
model remain unclear (Chesbrough et al., 2006). There are now a variety of models that a
company can adopt based on its mission, its type of integration and its target market
(Grassl, 2012).
Osterwalder and Pigneur (2010) were the first to split “beyond-profit business models” into
the third-party-funded model, in which a third party (i.e. donor, group of donors or public
sector) pays for an organization to provide a service or product to its recipients, and the
triple bottom line business model, which extends the nine building blocks to include social
and environmental costs and benefits, in an effort to maximize positive benefits and
minimize negative impacts. Smith (2012) proposed the non-profit Business Model Canvas
as an alternative: two canvases, presented alongside each other, include both the donor’s
and the beneficiary’s perspectives. Although this canvas highlights the separate activities of
each stakeholder, it has been criticized for being complicated, as the connections cannot
be easily observed in one glance (Qastharin, 2014). Another model, the social business
model canvas (Social Innovation Lab, 2013), rearranges the sequence of the building
blocks and includes new blocks that measure the social impact of the organization, and
how the surplus is invested. It also identifies the beneficiaries (persons who derive
advantage from the initiative) and differentiates between them and the customer (people or
organizations willing to pay to address the issue including donors and volunteers), as noted
by a dotted line in two of the building blocks: segments and value proposition. The model
included beneficiaries, because they are believed to be crucial for the organization to fulfill
its mission.
While the social business model canvas provides more depth and allows greater flexibility,
it fails to mention the company’s overarching social objective – which should be the basis of
a social business (Yunus et al., 2010). Consequently, the business model canvas for social
enterprise (Qastharin, 2014) was designed, drawing from the aforementioned models and
additional canvases proposed at a US sustainability conference (GoGreen Portland, 2014)
and Yeoman and Moskovitz’s (2013) social lean canvas.

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 As illustrated in Figure 1, the model includes two additional elements: the mission of the
business and the impact and measurements of a social objective. It also differentiates
between co-creators and beneficiaries (referred to as “customers” in the social business
model canvas) in both the value proposition and customer segments boxes. The additional
elements – placed at the beginning and end of the model – and the clear delineation
between co-creators and beneficiaries, illustrate the most comprehensive and holistic
approach a social enterprise can take toward catering to its customers and the
communities for which it cares. The model was developed following the analysis of a social
enterprise in Indonesia that needed to further breakdown the building blocks due to multiple
stakeholders being invested in or impacted by the company. However, while the model
offers a unique and interesting perspective (Aziz and El Ebrashi, 2016), it is yet to be
verified on other enterprises. Further testing of the model on other social businesses would
be beneficial as a way to validate the model. Additionally, the model’s clear distinction
between co-creators and beneficiaries, which is only noted in the customer segments and
value proposition boxes, could be extended to other blocks, particularly if these entities are
separate and guide the organization’s mission, operations and impact. This is especially
useful in social tourism businesses that try to cater to and disseminate value to a plethora of
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stakeholders.

Methodology
A case study method was chosen for collecting and analyzing data. Case study research
has emerged as a multi-method research strategy for the social sciences (George and
Bennett, 2005) that allows multiple perspectives from a variety of sources to be
incorporated in a systematic way (Yin, 1984). Many authors agree that case studies are an

Figure 1 Modified Business Model Canvas for Social Enterprises

j TOURISM REVIEW j
 ideal way to examine complex questions, and provide a holistic and in-depth exploration of
a chosen area of investigation (Feagin et al., 1991; Grosshans and Chelimsky, 1990;
Merriam, 2009). This triangulation of sources enables a researcher to gather enough
information to check for trends, identify possible patterns, rule out competing explanations,
corroborate findings, build explanations and produce a thematic review. In addition,
through the use of multiple data sources (subjects and various types of investigation), data
that are collected hold stronger trustworthiness for theories and hypotheses (Yin, 1984).
The organization selected for investigation is a mid-range boutique hotel, Hotel con
Corazo n (Hotel with Heart), located in Granada, Nicaragua, that invests all of its profits into
local educational programs. Nicaragua has the second highest rural poverty rate in Central
America (National Institute of Statistics and Census, 2001). Many residents in rural areas
have limited access to education, with public expenditure favoring urban schools and
neglecting rural areas (UNDP, 2000). There are no public universities in Granada; the
closest is in Managua, 46 kilometers (28 miles) in driving distance. Primary and high school
enrollment is low and suffers from low retention and limited facilities. Furthermore, English
language skills, which are desirable for those seeking employment in the tourism or
hospitality industry, are available only to those community members who are wealthy or
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well-connected or have access to educational programs (Sproule, 1996). A recent study on

staff placement at ecotourism establishments in Thailand found that less educated
residents are disadvantaged when seeking employment due to their lack of skills,
experience and knowledge (Laverack and Thangphet, 2007).
Owing to the pleasant climate, spectacular scenery, unique culture and higher levels of
personal safety than in other Central American countries, tourism has grown to become the
second largest industry in Nicaragua. Granada is the oldest colonial city located in Western
Nicaragua near Lake Nicaragua. It ranks as the most popular tourist destination in the
country (INTUR, 2013), yet despite the continued increase in popularity, tourism
infrastructure remains very basic (USA Department of State, 2012), and there is an
enormous potential for further development and additional tourism enterprises to cater for
this growing demand.
Hotel con Corazo n opened in October 2008. It fits the criterion of a social tourism business
that is self-sustaining from the profit generated by the business, has a clear social objective
(to support local education programs), invests surplus revenue to achieve its mission and
includes all stakeholders. The hotel was also selected, because it disseminates value not
only through the investment of surplus funds to its social mission, but also in its daily
operations by including local residents and providing residents with educational
opportunities and other benefits.
The author conducted site visits, face-to-face interviews with the founders and employees of
the organization (in managerial positions and non-managerial positions) and face-to-face
interviews with tourists staying at the hotel. All of the interviews were structured, open-ended
and in-depth, and were later transcribed verbatim by the author. Additional forms of data
include field observation notes, photographic documentation annual reports and web media
content. Written descriptions were completed on these items for inclusion in the analysis.
Data were examined through content analysis, which enables a researcher to quantify and
analyze the presence, meaning and relationships of words and concepts, and make
inferences about the messages and information from these texts (Kohlbacher, 2005). Using
a color-coding mechanism, data were organized around pre-set codes of components
within the business model canvas for social enterprise as developed by Qastharin (2014).

Results
Below is a description of each of the components of the model as it pertains to the
company. Findings are grouped according to the building blocks within Qastharin’s canvas

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 (2014), but now all blocks are further divided into co-creators and beneficiaries, with the
intention of emphasizing the significance in the divide. As in Qastharin (2014), the term “co-
creators” was adopted and includes in-kind contributions, such as volunteers, as well as
those paying funds, such as donors and customers. In this case study, the term
“beneficiary,” persons who derive advantage from the initiative, includes local community
residents, employees and those involved in the education program.

Mission
Co-creators: The hotel has four guiding business principles that influence its design and
daily operations. The first two: “fun and fresh” and a “place to be you” cater to the needs of
the customers (hotel and tour patrons) through the provision of a locally designed hotel with
Western amenities to ensure a comfortable stay.
Beneficiary: The remaining two guiding principles, “local color” and “good business” cater
to fulfilling the needs of the beneficiaries and improving their livelihood. The hotel’s
commitment to “local color” means it embraces ways to include and showcase the local
community. It hires local residents despite their lack of skills, formal education or language
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abilities, purchases supplies from local vendors, acts as an intermediary for local
craftswomen and channels its profits into educational efforts, thereby benefiting children,
parents and teachers. The hotel also has a very transparent and well-publicized mission:
“To invest all profits into local educational programs.” This mission guides its social impetus
to improve social conditions for the local citizens, and determines the investment of surplus
revenue.

Customer segments
Co-creators: The hotel caters to both a niche and the mass tourism market. It receives free
independent travelers and group travelers from around the world, mainly Western countries,
of a wide age bracket.
In 2015, the hotel’s 3,287 guests were from the USA (42 per cent), The Netherlands (15
per cent), Canada (6 per cent), France (6 per cent), Costa Rica (6 per cent), the UK
(5 per cent), Nicaragua (5 per cent), Germany (4 per cent), and other countries
(12 per cent). The hotel’s social objective, particularly its dedication to education, is an
explicit element within its marketing mix, and it strives to appeal predominantly to the socially
conscious traveler. Guests know that hotel profits are invested in the local community’s
education, and they are happy to stay somewhere that is socially oriented without
jeopardizing price, quality, or amenities. However, due to the hotel’s high-quality products,
services, competitive rates, and prime location, a customer does not have to be motivated
by the social cause to stay at the hotel.
Beneficiary: The individuals that benefit from the initiative are those who are geographically
disadvantaged or who do not have access to opportunities such as education. All of the
employees are local residents in the community. The creators of the handcrafts are women
from Granada and surrounding communities. The two local school programs that receive
funding are in a nearby rural village, Las Lagunas, and the two NGOs that receive financial
contributions, La Esperenza and Empowerment International, are also local organizations
involved in education.

Value proposition
Co-creators: Customers can experience a high-quality hotel, with a full range of “fun and
fresh” facilities and amenities, at a price that is comparable to its competitors of the same
star rating. Customers enjoy added value knowing their money is going toward local
education projects. Customers also have a more authentic product as the hotel uses local

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 vendors, sells products on behalf of local craftswomen and provides an opportunity to
interact with local residents, all of which enhances a customer’s experience. The project
also creates value for the board members and their donors, who provide in-kind services or
financial donations. These individuals are intrinsically motived to be part of an initiative that
makes the world a better place.
Beneficiaries: The hotel provides on-site training for local residents in multiple departments
to increase their skill set and create opportunities for career progression. The hotel believes
this not only benefits the employees by enhancing their skills, but also provides a better
service experience for the tourists, as employees are able to help other employees during
peak periods. The hotel has an incentive program that gives employees an extra 10
per cent of their salary if they attend university, regardless of the course. The hotel believes
this creates a more skilled employee, which is good for the employee, the guests and the
company. Local community residents also benefit from the business because of the hotel’s
commitment to keep the project local. Having a local supply network for labor, materials,
goods and services has meant more money staying within the local economy, ensuring
lower levels of leakage. The money generated from the sale of local handcrafts goes
directly to the women from the community who make the products.
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Key activities
Co-creators: Hotel con Corazo n provides hotel guests with a comfortable, home-away-from-
home getaway “a place to be you” at an affordable rate; complimentary Wi-Fi and
recreational facilities; meal options for breakfast, lunch and dinner; tours; and in-house
shopping for local artifacts.
Beneficiaries: Key activities toward beneficiaries include educating the workforce through
on-the-job training and financial assistance for university courses, elevating local merchants
with in-house sales, favoring local vendors for goods and services and investing in the
education of the local community. Educational funds are disseminated through field trips
and activities, to highlight that learning can be fun, tutoring classes for students,
maintenance of educational materials and computer equipment, scholarships and home
visits to parents to enhance their understanding of the value of education. Funding is also
provided to the two local NGOs involved in education.

Key resources
Co-creators: Hotel con Corazo n was founded by two Dutch social entrepreneurs in 2003,
henceforth referred to as the founders. Having visited Nicaragua, they realized that tourism
had enormous potential, but that there were problems with the country’s educational efforts,
chiefly limited resources and retention. They had the idea to establish a hotel as a tourism
business to generate income to invest money toward educational initiatives. Following this
they met with the Ministry of Education, and were put in touch with two local schools
needing assistance in the Las Lagunas area. Upon returning to The Netherlands, they
assembled an organizing board named Foundation Hotel con Corazo n. The board
comprises six members (up from five when it was first created), including the founders. The
board members participate on a voluntary basis, are employed full-time in professional
careers and are keen on using their skills and experience to make a difference in the world.
Their combined professional experience includes marketing, finance, hotel management,
tourism and education. The skills and connections of the board members assisted with the
creation of a solid business plan and the generation of startup funds through additional
donors.
In addition to their qualifications and work-experience, the board members were familiar
with the needs and wants of the Western traveler – which is the predominant tourist market
to Nicaragua. One of the obstacles that locals face when establishing a tourism business is

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 their lack of knowledge concerning Western tourists, which makes it difficult to cater to the
needs of this market. Thus, the board members’ know-how and network of professionals
proved instrumental during fundraising efforts.
Beneficiaries: The hotel hires two “on-site foreign managers” to assist with daily operations
and provide guidance when needed. It is an 18-month, rotating position which will one day
become filled by local residents. All other employees are residents in the community.
Employees are hired based on their attitude rather than prior experience or language
abilities. The hotel’s tangible assets, such as the building, furniture, amenities and food and
beverage, are all sourced locally.

Customer relationships
Co-creators: The hotel’s four guiding business principles ensure a personal and more
authentic product and service. The hotel strives to deliver superior service through its
friendly and knowledgeable employees. Through developing personal relationships with
customers, the hotel creates a community of social ambassadors who can spread the word
about the hotel and its mission. This promotes additional donations and creates a referral
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base for future travelers.

The website is also very detailed and includes every annual report since the hotel launched.
The first annual report contains a detailed time-line describing the history and development
of the hotel; subsequent annual reports detail the hotel’s mission, strategy (how it operates)
and an overview of its business principles and philosophies. The reports are available for
download in English, Spanish and Dutch, and copies are also displayed in the hotel lobby
and in each room. The walls of common areas such as the restaurant/bar, courtyard and
reception/lobby are decorated with photographs of the hotel’s social efforts and its mission
statement (it is painted on the walls).

Revenue
Co-creators: The hotel has a number of revenue outlets, accommodation charges from the
16 rooms, food and beverage sales and tours. It also still accepts donations. A breakdown
of the revenue sources is: accommodation, 80 per cent; food and beverage sales, 6.5 per
cent; tours, 13 per cent; and other, 0.5 per cent. In 2015, the hotel maintained an average
occupancy rate of 66 per cent and organized 420 tours for 1,250 guests. It reported US
$277,785 total revenue, averaging US$77 per room per night. Its net profit after expenses
listed in cost structure was US$71,786.
Beneficiaries: All profits are invested into local educational programs. Additionally, all
revenue generated from the sales of local artifacts goes to the vendors; the hotel sees itself
as more of a facilitator, and feels that it provides an additional service for the guests.

Channels
Co-creators: Hotel con Corazo n utilizes both direct and indirect distribution strategies to
reach customers. Its website provides details of the hotel’s rooms, the services available
and the trips offered, and enables direct booking. In addition, the website highlights the
hotel’s involvement in community efforts through actively displaying its mission, revenue
structure and annual reports. Customers can also access information about the hotel
through indirect distribution methods. The hotel is listed through popular intermediaries
such as booking.com, agonda.com and Tripadvisor and has an active Facebook presence.
Due to its novel business model, it has been featured in popular magazines, as well as in
the press and online. Lastly, previous guests actively inform potential guests about the
property through word of mouth.

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 Beneficiaries: Employee recruitment is typically done through word of mouth, whereby
managers ask the employees for recommendations or referrals. The hotel has established a
reputation as a good employer and residents stop by to enquire about vacancies. Local
vendors and the products of local craftspeople were identified through the founder’s
connections with other hoteliers. Educational partners were recommended based on need,
following a meeting with the Ministry of Education.

Cost structure
The main cost of the business was the initial construction of the hotel, for which startup
funds of e470,000 were used. Since its opening, the hotel has expanded from 15 to 16
rooms. It has also increased the services it offers guests, such as providing tours, and
upgraded the facilities when necessary. In 2015, major renovation expenses were
undertaken to replace the air-conditioning systems in the rooms with more sustainable ones
and fix the roof. The main operating costs include personnel, purchasing, restaurant, bar
and office supplies, maintenance: gas, water and electricity, administration and promotion,
cleaning, transport and execution of the tours. In 2015, these expenses totaled US
$184,863. In addition to this, the company paid US$21,136 in income taxes, reservation
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maintenance and reservation installations.

Key partners
Co-creators: Foundation Hotel con Corazo n raised funds through official presentations to
friends, the one-time sale of social shares in the company (a financial donation of e500),
various fundraising activities and smaller individual donations. The total funds raised were
then matched by an NGO in The Netherlands, who in return asked for an annual report
detailing how the money was spent.
Beneficiaries: The founders spent approximately two years during the start-up/construction
phase of the business, establishing themselves in the community. They befriended other
hoteliers who put them in contact with local carpenters, seamstresses and other local
suppliers. Through the Ministry of Education, they were also in contact with several school
teachers and tutors in the surrounding community, who helped to design the educational
program for the children. They also established a rapport with the local education-based
NGOs to identify the reasons for educational problems and how they could try to overcome
them. The organization has maintained these relationships since its inception.

Impact and measurement

Co-creators: An additional measure of success, and recognition of the quality of the hotel’s
products and services, is by the hotel’s five-star rating on TripAdvisor (from 604 reviews). It
is also ranked as Granada’s top-rated hotel, and is regarded as one of the most popular
hotels in Nicaragua.
Beneficiaries: The hotel’s mission to invest into local educational programs has resulted in
multiple quantifiable outcomes. In 2015, the hotel paid for seven teachers and provided
educational support to 284 primary school students. The surplus funds helped to offer
classes on four days a week to students in first, second and third grade, and to provide
homework support to students in the fourth grade or higher. The teachers employed
through Hotel con Corazo n spend one day a week with the families of the students to help
them realize the importance of education. They also provide some support to parents to
enable them to help their children with homework. The teachers have reported fuller
classrooms, fewer dropouts and improved student grades. Based on the success of the
home visits, the Ministry of Education opened a secondary school in the area based on
requests from parents. Furthermore, the funds spent on employee educational efforts

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 resulted in 10 out of 11 full-time employees studying courses ranging from English to
Accounting.

Conclusion
Social businesses are mission driven, and the business models used to describe them
need to include their social objectives and outcomes (Bull and Crompton, 2006). This study
demonstrates the use of the additional building blocks within Qastharin’s (2014) business
model canvas for social enterprise – the business’s “mission,” and the business’s “impact
and measurements” – which allow a richer understanding of why and how an organization
functions. Additionally, the clear distinction between “co-creators” and “beneficiaries” in the
model highlights the fact that social enterprises can benefit a variety of stakeholders,
depending on their mission and operational structure.
In the case study presented, of the Hotel de Corazon in Granada, Nicaragua, further
delineations were made, in many of the other blocks in the model, to show the additional
stakeholders benefiting from the business. One of the difficulties of managing performance
in business is articulating all of the objectives in a measureable way (Bull and Crompton,
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2006); the additional delineations included in this paper clearly show the many other
intangible values that a company can distribute, subject to its business model.
The examination of the Hotel de Corazon’s business found shared value among all
stakeholders: high customer ratings, continued profits, inclusion of residents as suppliers
and employees and successful results from the educational initiatives. The “beneficiaries”
included local residents in the form of employees, vendors, merchants and those involved
with or receiving educational funding. Indeed, the case study of this social tourism business
demonstrates that tourism can benefit the local community, rather than just foreign investors
or local elites, if it is developed in a socially responsible manner. The case study also
provides a canvas that other social tourism businesses can adopt.
As this investigation examined only one type of tourism and hospitality business, in one
geographical location, devoted to one primary mission, it is recommended that additional
studies are conducted on other social tourism businesses using Qastharin’s (2014)
Business Model Canvas for Social Enterprise, particularly in LEDCs. It is also recommended
that the delineations between “co-creators” and “beneficiaries” be made in all the blocks in
the model, as in this study. These studies would continue to validate the business model
canvas, the usefulness of delineations between “co-creators” and “beneficiaries,” and the
ways in which social based tourism businesses can create more equitable forms of tourism.

Note
1. The business model canvas is a visual chart that illustrates the building blocks of a business model
and assists stakeholders to understand the structure and flow of an organization (Osterwalder and
Pigneur, 2010).

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Corresponding author
Alexia Franzidis can be contacted at: [email protected]

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