Strategic Analysis of Hotel Savoy and Premier Inn: Hospitality Business Management Insights Case Study

Strategic Analysis of Hotel Savoy and Premier Inn: Hospitality Business Management Insights

Introduction: Strategic Analysis of Hotel Savoy and Premier Inn: Hospitality Business Management Insights

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The report is revolving around the hospitality business management. The report highlight theories related to the hospitality management. The report present case study of two hotels named Hotel Savoy and primer inn. The report discusses application of theories and models assists businesses in understanding their existing company position and selecting the best strategic instruments to flourish in the market. The report will offer a summary of the results as well as recommendations for these two firms to solve the difficulties they are facing.

1.0 Background of the Case Studies:

1.1 Hotel Savoy

Hotel Savoy is a luxury hotel brand that was established in the late 19th century. The brand is known for its traditional European style, high-end service and quality amenities. The Hotel Savoy has a rich history of welcoming guests from all over the world and providing them with an unforgettable experience.

The brand operates several hotels in cities across Europe, including Paris, Florence and London. Each Hotel Savoy property is unique and showcases its own distinct design, but all share the brand's commitment to quality, luxury, and impeccable service.

Hotel Savoy's main areas of expertise include fine dining, event planning and catering, and hospitality. The brand's restaurants are renowned for their gourmet cuisine, and the hotel's event spaces are popular for weddings, conferences and other special events. The brand is also recognized for its exceptional hospitality, with staff trained to provide guests with the highest level of service.

In terms of its current position in the market, Hotel Savoy is considered one of the leading luxury hotel brands in Europe. The brand continues to innovate and evolve, offering new and unique experiences to guests while maintaining its commitment to quality and luxury.

Hotel Savoy's vision is to be the world's most sought after luxury hotel brand, renowned for its exceptional service and timeless elegance. The brand's mission is to provide guests with an unforgettable experience that exceeds their expectations, and its objectives include continually improving its services and amenities, expanding its global presence, and delivering a memorable and personalized experience to each and every guest. The brand's scope is to provide high-end luxury hospitality services to guests from all over the world.

Figure 1 Company logo

1.2 Premier inn

Premier Inn is a UK-based hotel brand that was established in 1987. It is the UK's largest hotel chain, operating over 750 hotels and 80,000 rooms across the country. The brand is known for its affordability, high-quality accommodation, and convenient locations.

Premier Inn's main areas of expertise include budget-friendly hotel accommodation, food and beverage services, and meeting and event spaces. The brand's restaurants, Thyme, serve traditional British cuisine, and its hotels offer a range of room types to accommodate guests' needs, from budget-friendly standard rooms to family rooms and suites.

In terms of its current position in the market, Premier Inn is one of the leading budget hotel brands in the UK, with a strong presence in both urban and rural areas. The brand is known for its affordability, quality and convenience, and is a popular choice for both business and leisure travelers.

Premier Inn's vision is to be the UK's first choice for budget hotel accommodation, providing guests with high-quality and affordable rooms in convenient locations. The brand's mission is to provide guests with a comfortable, reliable and affordable stay, and its objectives include continuing to expand its presence in the UK and abroad, improving the quality of its services, and delivering an exceptional experience to each and every guest. The brand's scope is to provide budget-friendly hotel accommodation and food and beverage services to guests in the UK and internationally.

Figure 2 logo

2.0 PESTLE analysis

The PESTLE study is a useful method for determining the macro environmental elements that may affect a company or sector. Businesses may get a complete awareness of the external elements that may affect their operations by investigating the Political, Economic, Socio cultural, Technological, Legal, and Environmental aspects that influence the operational environment.

The importance of PESTLE analysis lies in its ability to provide businesses with a framework for understanding the broader context in which they operate. By considering the different elements of the PESTLE analysis, businesses can recognize possible risks and chances and construct informed conclusion about how to respond to these external factors. For example, a business might consider the political stability of a country before investing in a new market, or assess the impact of changes in technology on its operations.

Pestle analysis of Hotel Savoy

PESTLE analysis is a framework used to analyze the macro-environmental factors that can impact a business. A PESTLE analysis of Hotel Savoy might include the following elements:

Political:

Changes in government policies, such as tourism and hospitality regulations, taxes and visas which can affect the operations and performance of Hotel Savoy. Security issues, such as terrorism, can impact the demand for luxury travel.

Economic:

• Economic growth, inflation, and exchange rates can impact the cost of operating and expanding the hotel business, as well as the purchasing power of guests.
• Changes in consumer spending patterns and disposable income can affect the demand for luxury travel.

Social:

• Changes in demographic patterns and cultural attitudes towards luxury travel can impact the demand for the services offered by Hotel Savoy.
• Trends in eco-tourism and sustainable travel can impact the brand's approach to environmental responsibility and sustainability.

Technological:

• Advances in technology can impact the way the hotel operates, from online booking systems to the use of automation in the delivery of services.
• Changes in the way guests use technology, such as the increasing use of mobile devices, which can impact the way the hotel interacts with and serves guests.

Legal:

• Changes in laws and regulations, such as data privacy and labor laws, can impact the way the hotel operates.
• The hotel must adhere to health and safety regulations, as well as environmental regulations.

Environmental:

• Climate change and environmental issues can impact the hotel's operations and the demand for sustainable travel.
• Natural disasters, such as hurricanes and earthquakes, can impact the hotel's physical operations and the demand for travel to the affected areas.

Pestle analysis of premier inn

Political:

• Changes in government policies, such as tourism and hospitality regulations, taxes and visas, can affect the operations and performance of Premier Inn.
• Security issues, such as terrorism, can impact the demand for budget travel.

Economic:

• Economic growth, inflation, and exchange rates can impact the cost of operating and expanding the hotel business, as well as the purchasing power of guests.
• Changes in consumer spending patterns and disposable income can affect the demand for budget travel.

Social:

• Changes in demographic patterns and cultural attitudes towards budget travel can impact the demand for the services offered by Premier Inn.
• Trends in eco-tourism and sustainable travel can impact the brand's approach to environmental responsibility and sustainability.

Technological:

• Advances in technology can impact the way the hotel operates, from online booking systems to the use of automation in the delivery of services.
• Changes in the way guests use technology, such as the increasing use of mobile devices, can impact the way the hotel interacts with and serves guests.

Legal:

• Changes in laws and regulations, such as data privacy and labor laws, can impact the way the hotel operates.
• The hotel must adhere to health and safety regulations, as well as environmental regulations.

Environmental:

• Climate change and environmental issues can impact the hotel's operations and the demand for sustainable travel.
• Natural disasters, such as hurricanes and earthquakes, can impact the hotel's physical operations and the demand for travel to the affected areas.

3.0 Porter five forces

The Porter Five Forces model is a structure for analyzing the competitive surroundings of a business or industry. It was industrial by a professor named Michael Porter in 1979 and is extensively used as a tool for strategic planning and analysis. The Porter Five Forces model is considered to be an important tool in strategic analysis and planning because it provides a comprehensive framework for understanding the competitive forces that impact a business or industry.

This fact can then be exercise to compose informed choices about how to position the company for success, such as by investing in differentiation, improving the bargaining power of the business, or finding ways to reduce the threat of substitutes. By considering the five forces and their relative strengths, businesses can develop a robust and effective strategy that takes into account the competitive environment and the potential impact of external factors.

Porter five forces analysis of Hotel Savoy

Porter's Five Forces is a framework used to analyze the competitive environment of an industry. A Porter Five Forces analysis of Hotel Savoy might include the following elements:

Threat of New Entrants:

• The luxury hotel industry is capital-intensive, requiring large investments in physical assets, brand building, and operational capabilities.
• The barriers to entry are relatively high, as new entrants must build a reputation and establish a brand in a highly competitive market.

Threat of Substitutes:

• Alternative forms of accommodation, such as serviced apartments and vacation rentals, can pose a threat to the demand for luxury hotels.
• Luxury travel experiences, such as cruises and adventure tours, can also serve as substitutes for traditional luxury hotel stays.

Bargaining Power of Suppliers:

• Hotel Savoy relies on a range of suppliers, including those for food and beverage, linens, and cleaning products.
• The bargaining power of suppliers may vary depending on the availability of alternative suppliers, the level of differentiation of the products or services being supplied, and the importance of the supplier to the buyer.

Bargaining Power of Buyers:

• Luxury hotel guests are discerning and have high expectations for quality, service, and value.
• The bargaining power of buyers is relatively high, as they have a range of options for accommodation and can be price-sensitive.

Rivalry among Existing Competitors:

• The luxury hotel industry is extremely competitive, with a huge number of recognized players competing for marketplace share.
• Rivalry among existing competitors can be intense, as they compete on factors such as brand, location, quality, and price.

Porter five forces analysis of premier inn

Threat of New Entrants:

• The budget hotel industry is capital-intensive, requiring significant investments in physical assets, brand building and operational capabilities.
• However, the barriers to entry are relatively low, as new entrants can enter the market relatively quickly and at a low cost.

Threat of Substitutes:

• Alternative forms of accommodation, such as serviced apartments, vacation rentals and hostels, can pose a threat to the demand for budget hotels.
• Budget travel experiences, such as camping and backpacking, can also serve as substitutes for budget hotel stays.

Bargaining Power of Suppliers:

• Premier Inn relies on a range of suppliers, including those for food and beverage, linens, and cleaning products.
• The bargaining power of suppliers may vary depending on the availability of alternative suppliers, the level of differentiation of the products or services being supplied, and the importance of the supplier to the buyer.

Bargaining Power of Buyers:

• Budget hotel guests are price-sensitive and are often seeking the best value for their money.
• The bargaining power of buyers is relatively high, as they have a range of options for accommodation and can easily compare prices and quality online.

Rivalry among Existing Competitors:

• The budget hotel industry is highly competitive, with a large number of established players competing for market share.
• Rivalry among existing competitors can be intense, as they compete on factors such as brand, location, quality, and price.

• Critical analysis

Hotel Savoy operates in a highly competitive and constantly evolving luxury hotel industry, with factors such as political stability, economic conditions and technical advancements impacting its operations and performance. Premier Inn operates in a highly competitive and dynamic budget hotel industry, with factors such as macroeconomic conditions, legal and regulatory environments and technological innovations shaping its operations and performance.

Hotel Savoy faces significant competition from established luxury hotel brands, alternative forms of accommodation and budget-friendly travel experiences. Premier Inn faces intense competition from established budget hotel brands, alternative forms of accommodation, and budget-friendly travel experiences. Both hotels must be mindful of the negotiating power of dealer and buyers, and must remain competitive on factors such as quality, location and price to remain relevant and successful.

Both Hotel Savoy and Premier Inn operate in highly competitive industries, and must remain aware of the impact of both internal and external factors on their operations and performance. By continuously adapting to changing market conditions and evolving consumer preferences, both hotels can remain competitive and continue to succeed in their respective markets.

4.0 Conclusion and recommendation

In conclusion, the Porter Five Forces model and the PESTLE analysis provide valuable frameworks for understanding the competitive and macro-environmental factors that may impact a business or industry. In the case of Hotel Savoy and Premier Inn, both companies operate in the highly competitive hospitality industry and face a range of challenges and opportunities.

A Porter Five Forces analysis revealed that the threat of new entrants, bargaining power of buyers, and rivalry among existing competitors which are particularly strong forces in the industry, while the bargaining power of suppliers and threat of substitute products or services are relatively weak. A PESTLE analysis revealed a range of macro-environmental factors that may impact the companies' operations, including changes in the economic and legal environment, shifts in consumer behavior, and technological advancements.

Based on this analysis, the following recommendations can be made for both companies:

Invest in differentiation: With high levels of competition, both Hotel Savoy and Premier Inn should consider investing in differentiation to stand out from the crowd and appeal to customers. This could involve offering unique or high-quality services, targeting niche markets, or improving the customer experience.

Monitor the competitive landscape: The competitive environment in the hospitality industry is rapidly changing, so it is important for both companies to regularly monitor the competitive landscape and adapt their strategies as needed. This could involve tracking the strategies of competitors, tracking industry trends, and making changes to their business models as needed.

Respond to changes in the macro-environment: With the macro-environment rapidly changing, both companies should stay ahead of potential changes in the operating environment and take proactive steps to mitigate any negative impacts. This could involve monitoring changes in the political, economic, and legal environment, tracking shifts in consumer behavior, and adapting their operations to new technological advancements.

Strengthen bargaining power: Both companies should consider ways to strengthen their bargaining power, such as by improving relationships with suppliers, finding new sources of supply, or reducing dependence on any one supplier.

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