Business Management Contemporary strategy

Question: Discuss about the Business Management Contemporary strategy. Answer: Statement of the Problem The Sweet Dreams Motel owner, Mr. Smith should focus on addressing the challenge of occupancy as well as offering takeaway services to customers. Currently, the owner advertises its accommodation services through word of mouth. However, Mr. Smith needs to carry out a SWOT analysis to address these challenges effectively. Analysis Target Market The local families and couples, as well as increasingly worldwide visitors, are the potential customers of The Sweet Dreams Motel. The other clients are the regular tourists who typically get accommodated in the hotel during holidays. Key Stakeholders The primary stakeholders of the motel are Mr. Smith who is the owner of Sweet Dreams Motel. As the proprietor, Mr. Smith serves breakfast and offers tea making facilities to the rooms. The other key stakeholders are both the local and overseas tourists who visit the motel in holidays. Also, local families and couples who are a primary customer of the resort are another key players. SWOT The Sweet Dreams Motel operates in an environment surrounded by strengths, weaknesses, opportunities, and threats both internally and externally. Internal Environment Strengths Large rooms for accommodation Excellent management skills by the owner who can multi-task Cost effective business for there is petite advertising done High quality of accommodation and breakfast services Weaknesses There is no television in the sleeping rooms thus no fan Small profits due to low prices which the motel charge on services offered Occupancy problems since the number of attendants in uncertain Lack of new development in the parking areas chase away some customers External Analysis Opportunities Plenty of rooms for future expansion An excellent strategic location close to beach, shops, and other attractions Regular tourists every holiday creates an opportunity to expand occupancy Increasingly overseas visitors Threats Other restaurants and takeaways in the area pose competition Stiff competition from big five-star hotels New developments could be troublesome Losing market due to little advertising SWOT Description From SWOT, the internal environment of the Motel is faced with weaknesses and have various strengths( Gao Peng, 2011). The Motel has no televisions in the guest house, and this discourages visitors from renting the Motel. On the other side, Mr. Smith can multi-task roles. Through his skills, there are little advertising costs and ensures that the sleeping rooms are well ventilated for visitors to have fresh air. Under the external analysis, the Motel has many rooms for expanding its occupancy. Also, it is strategically located for winning more customers (Grant, 2016). However, its operations are threatened by the big five-star hotels as the main competitors. Impacts of PESTEL factors to the Motel Political Politics in the industry will negatively affect the operations of the Motel. Changes in government policies and trade agreement requirements may be costly to the firm (Gao Peng, 2011). However, international business regulations shield the Motel from foreign restaurants competition and thus smooth flow of business. Economical Economic business factors provide a threat to the Motel in that fluctuations in currency exchange rates, inflation, and taxations on the firm operations are costly. However, the Motel has an opportunity to avoid advertising and cut the costs of advertising (Robbins Judge, 2012). Also, the Motel has an option of maximizing its operations in the peak and holiday seasons. Social-cultural The Motel has an opportunity to diversify its services on an age and gender-based approach to address the tastes and preferences of the customers adequately (Gao Peng, 2011). However, variations in lifestyle trends by the tourists and visitors expose the Motel to a huge challenge while deciding what service to offer at a particular time. Technological Technological advancements in the tourism sector provide the Motel with an opportunity to do market research and understand the competitor's approach (Grant, 2016). However, the Motel faces a threat of losing customers to well-established restaurants in the market who are to offer high quality services due to the huge capital base where technology advancement is not an issue. Legal Legal requirements for every firm to get a license from the registrar of companies provides the Motel with an opportunity to avoid unfair competition from other restaurants (Noe, Hollenbeck, Gerhart, Wright, 2006). However, the high costs of compliance are expensive for the firm, and this reduces its overall returns. The fact that local families and couples and increasingly overseas visitors are the potential clients of the Motel means that the firm has an opportunity to increase the number of rooms especially during the holiday seasons (Robbins Judge, 2012). On the other hand, these are also the customers for the other competing Motels in the market. Competitors The key competitors of the Motel pose a threat of lowering the number of customers for The Sweet Dreams Motel. This is because a lot of restaurants in the sector offer takeaways and the Motel does not (Grant, 2016). However, being strategically located near the beach and other attractions, the Motel can advertise its services and obtain a competitive advantage. Suppliers The industry depends on the same supplier of accommodation and tea making facilities. The Motel has an opportunity to order more at one time and pay at a lowered price (Robbins Judge, 2012). However, there is a threat from other restaurants which are well established and can even order more products on credit. Regulators and strategic partners Mr. Smith is a member of local tourist committee, and this means that he has to run the Motel as per the union's policies. Government policies may render the Motel subject to losses since the firm has to pay a lot of taxes and compliance fees (Grant, 2016). However, there is an opportunity to partner with the government who would sponsor the Motels activities through free licenses, tax exemptions, and subsidies. Alternatives Mr. Smith, as the owner of the Motel, has an immediate option of attending the local tourist committee meeting where he is a member. Another option is advertising through the social media such as television or the internet (Grant, 2016). Pros Offer an opportunity to learn, share ideas and opinions of exploiting the business opportunities from other managers. Helps reach larger market Cons Mr. Smith may lose time to attend his customers since he is the one who serves breakfast and arranges for tea making facilities. Advertising is expensive. Link to SWOT There is a link to the SWOT of the Motel as explained above. Attending meeting with other motel owners creates an opportunity to understand the business environment under which the Motel operates (Robbins Judge, 2012). Recommendations Given the two alternatives which are attending tourists meetings and advertising, Mr. Smith should attend the meeting. This option is better than advertising since already the Motels owner is a member. Attending the meeting is less costly as compared to advertising. From the meeting, the owner will share new ideas of running the Motel to be competitive in the market. When this recommendation is effected, the Motel will exploit all available opportunities by expanding the market base. Further, the Motel will attract more tourists during the holiday season. References Gao, C. Y., Peng, D. H. (2011). Consolidating SWOT analysis with nonhomogeneous uncertain preference information.Knowledge-Based Systems,24(6), 796-808. Grant, R. M. (2016).Contemporary strategy analysis: Text and Cases edition. John Wiley Sons. Noe, R. A., Hollenbeck, J. R., Gerhart, B., Wright, P. M. (2006). Human resource Management: Gaining a competitive advantage. Robbins, S. P., Judge, T. (2012).Essentials of organizational behavior. Essex: Pearson.