Posted: April 26th, 2019

International Hotel Position Report Assignment Sample

International Hotel Position Report
Name
Academic Institution

Table of Contents

International Hotel Position Report 3
Current Position 3
Porter’s Five Forces Theoretical Model 3
PESTEL Analysis Theoretical Model 4
Practical Recommendations 5
Conclusion and Recommendations 5
References 7

International Hotel Position Report
The hospitality industry is one of the pillars of a strong economy yet investors do not pay much attention to it. The reason could be due to the poor economic performance of the existing hotels. Hotel industry investors should learn how to propel their enterprises using tactical and strategic management to increase market share. The aim of the position report is to provide a concise description of the success of an international hotel chain. The selected hotel chain is Shangri-La, Sydney. It is one of the few 5-star Chinese international hotel chains across the globe that have integrated western cultures (Lam, Ho & Law, 2015). The scope of the position report is to analyze the strategic and tactical management that should be employed by the Shangri-La hotel chain to enhance market share. The analysis will involve financial and economic data that will be used to make managerial decisions. It will address the current situation of the hotel using two theoretical models including PESTLE and Porter’s Five Forces Analysis. The report comprises of various main sections including current position, theoretical models, and practical recommendations.
Current Position
Shangri-La International Hotel Get research paper samples and course-specific study resources under   homework for you course hero writing service – Manage ment Limited is a luxury industry hotel business that started in 1971. It has grown over the years to a size of over 40,000 rooms across Asia, Europe, Middle East, Africa, and Canada (Abdullah, 2015). In 2010, the hotel had over 69 outlets and 29 new resorts under construction. The hotel has over 30,000 employees and annual revenue of 2.5 billion (Abdullah, 2015). The profitability of the company continues to increase due to the extensive marketing strategies employed in the business model. The position of the company of the hospitality company is that it has continued to offer satisfaction to the customers from all parts of their world due to their innovativeness.
Porter’s Five Forces Theoretical Model
Porter’s five forces analysis is a business model used to examine the forces that determine the competitiveness in the industry. The five forces include competitive rivalry, supplier power, buyer power, the threat of substitution, and threat of new entry (Bohari, Hin & Fuad, 2017). Competitive rivalry is one of the conditions that the hotel has experienced in the past. It includes competition from Madarin Oriental Hotel Group and Mrriott hotel Chain. The strength of the competition is based on the prices and the quality of services or products. The company has responded by providing quality food and accommodation services at attractive rates. Additionally, it has engaged in intensive marketing strategies to beat the competition (Bohari, Hin & Fuad, 2017). It has expanded into various subsidiaries across the world to dominate the market. Therefore, when customers travel they can find their hotels in Africa, Europe and Asia including other countries and regions. In some regions such as Africa, the hotel has little competition compared to the business rivalry in Australia.
Supplier power is another determinant of the position of the company. The reason is due to the cost of acquiring the best supplier and the likelihood of the suppliers to increase the prices. Over the last years, the company has acquired the best suppliers who provide the best technological requirements, services, and food products (Zhao, Zuo, Wu, Yan & Zillante, 2016). The intensity of rivalry in Australia is strong compared to Africa. In Australia, the company under intense competition from other hotels that require the same services or products offered by the suppliers. They are thus likely to switch to other dealers. As such, it is crucial to give the suppliers a good deal to ensure they do not terminate their services. On the other hand, buyer power is another determinant of the performance of the company (Zhao, Zuo, Wu, Yan & Zillante, 2016). The hotel targets high-end clients who want to book for accommodation during business trips or holidays. It has classic conference halls that are used to hold executive meetings. Therefore, the buyers are ready to pay the price of the accommodation and the food and drinks offered. The company has also increased buyer power through intensive marketing activities to attract more customers.
The threat of substitution is the likelihood that a competitor will provide similar services and products thus drawing away clients. It is one of the challenges that the company has to deal with in the era of technological development (Zhao, Zuo, Wu, Yan & Zillante, 2016). For example, the company recorded a drop in profitability in 2015 by 14.4 percent. One of the reasons for the in the profitability is that other better hotels emerge thus drawing the attention of customers. Additionally, the threat of new entry is another challenge that determines the position of the organization (Moro Visconti, 2016). Currently, the threat of new entry is minimal since the investment of such capacity requires massive resources. The hotel is thus working towards increasing the competitiveness to attract more customers and provide services at a reasonable price.
PESTEL Analysis Theoretical Model
PESTEL analysis is an approach used to examine the macro-environmental factors that determine the performance of a company. Shangri-La provides services to tourists and travelers that require accommodation, beverages, gaming, recreation, food, and meetings (Ahmed, 2019). It is thus affected by various macro-economic activities including political, economic, social, technological, and environmental factors. Political factors that affect Shangri-La include change of government policy, taxes, and government support. Government support for the tourism industry affects performance. Shangri-La has experienced cordial relations with the government in the various countries it has opened branches (Ahmed, 2019). Additionally, economic factors include the exchange rate, inflation, and economic growth. The company has experienced high inflation in Africa due to the political tension, wars, and terror attacks. In Australia, Shangri-La has experienced high economic growth that enhances the buyer power.
Social factors affect performance since it determines the availability of labor. For example, in Africa, cheap labor is available due to the high unemployment rate. Social factors also affect the rooms that different people book. Some guests prefer one room, single rooms or twin bedroom (Moro Visconti, 2016). For example, men prefer twin-bedroom while females prefer single rooms. The hotel has invested in technology to ensure all the rooms are automated. The automation reduces the workload for staff and enhances satisfaction of customers. Additionally, the company is affected by environmental factors due to global warming. Although most of its hotels do not experience severe rainfall or flooding, the temperature is an issue (Moro Visconti, 2016). For example, in Middle East it has to invest in high-end technologies to regulate the temperature. On the other hand, the hotel has been negatively affected by legal factors after it was found guilty of discriminating against Jews in 2012. Therefore, it is required by the law to abide by all the regulations in the respective countries it is based in.
Practical Recommendations
Shangri-La is restricted to Asia although it is currently opening hotels in other regions. It should thus strive to complete the hotels that are under construction which will tap new customers (Mak & Chang, 2019). It will also assure the existing customers that they can always find a Shangri-La hotel everywhere they travel across the world. The marketing strategies should also aim at attracting clients from other parts of the world. Additionally, it is important for the company to diverse services. Currently, it focuses on business travelers. It is thus losing customers who are looking for holiday packages (Jones & Comfort, 2019). There are companies that pay for a vacation for their employees and families that aspire to get competitive holiday packages. The diversity would enhance the competitiveness of the business and boost its essay writers performance. Diversifying to different packages would ensure that the company does not suffer financially during an economic downturn that limits executives from traveling.
The hotel can make improvements by increasing their competition through quality services and products at attractive prices. The ability of the company to tap more customers is to present itself as a global brand that takes care of all types of customers (Jones & Comfort, 2019). The customers have different needs due to their social, economic and political status in society. It is thus crucial to offer discounts or loyalty points to customers to keep them booking accommodation, buying food and beverages when they travel. Shangri-La can improve the current situation by enhancing their compliance with international business laws (Mak & Chang, 2019). For example, the lawsuit on the discrimination against the Jews destroyed the reputation and led to a loss of aggrieved Jews customers. The hotel business can also take advantage of the upcoming Tokyo Olympics that will see visitors from across the world looking for attractive hotel packages. The exchange rate fluctuations can also be avoided through hedging. Therefore, the business should explore opportunities to enhance performance.
Conclusion and Recommendations
Shangri-La has a strong brand that represents the Asian culture. It has a huge capacity that can accommodate thousands of travelers in their various branches. Shangri-La has high customer loyalty that can be utilized to create a highly-competitive hotel. One of the major threats is that Asia is shifting to the mid-market segment. Shangri-La can overcome the challenges and maximize its strengths by planning ahead. One of the existing opportunities in the upcoming Tokyo Olympics. It should also give the brand a global outlook and avoid restricting it to Asian region only. Implementation of the various recommendations can provide the best performing hotel in the world.

References
Abdullah, H. H. (2015). Strategy Building and Sustaining Competitive Advantage: A Case Study of Shangri-La Hotels (Malaysia) Berhad.
Ahmed, L. (2019). Performance analysis of mobile financial industries: a comparative analysis between Kash Limited and Dutch Bangla Bank Rocket.
Bohari, A. M., Hin, C. W., & Fuad, N. (2017). The competitiveness of the halal food industry in Malaysia: A SWOT-ICT analysis. Geografia-Malaysian Journal of Society and Space, 9(1).
Jones, P., & Comfort, D. (2019). Sustainable Development Goals and the World’s Leading Hotel Groups. Athens Journal of Tourism, 6(1), 1-14.
Lam, C., Ho, G. K., & Law, R. (2015). How can Asian hotel companies remain internationally competitive?. International Journal of Contemporary Hospitality Get research paper samples and course-specific study resources under   homework for you course hero writing service – Manage ment, 27(5), 827-852.
Mak, A. H., & Chang, R. C. (2019). The driving and restraining forces for environmental strategy adoption in the Hotel Industry: A force field analysis approach. Tourism Get research paper samples and course-specific study resources under   homework for you course hero writing service – Manage ment, 73, 48-60.
Moro Visconti, R. (2016). Healthcare public-private partnerships in Italy: Assessing risk-sharing and governance issues with PESTLE and SWOT analysis. Corporate Ownership and Control, 13(4).
Zhao, Z. Y., Zuo, J., Wu, P. H., Yan, H., & Zillante, G. (2016). Competitiveness assessment of the biomass power generation industry in China: A five forces model study. Renewable Energy, 89, 144-153.