4.

0 Market Analysis Summary

4.5 SWOT Analysis
Strengths, Weaknesses, Opportunities and Threats.

Strengths.
The strong points of your hotel -
business exterior is clean and tidy.
prices are cheaper than your competitors.
service style is new to the area.
offer a product no other business offers.
have a branded image.

Weaknesses.
The weak points of your hotel -
hotel is new and not established.
have limited funds available.
offer a product which is already available on the market.
Customers have to travel further to get to your hotel.

Opportunities.
Benefits for your hotel - Examples are:
A new office complex is opening nearby.
A new housing development is being built nearby.
A main competitor has closed down.
The building next door has become available so expansion may be an option.



Threats.
Instances that can harm your hotel -
A high street brand is moving into the area.
Your operating costs are set to increase soon.
Your business lease is up for renewal and a rent increase will happen.
A main competitor has lowered their prices and started a price war with you




















4.6 Competition & buying patterns
Probably the most important part of a lodging market analysis is the study of current and
proposed competition. It is sometimes helpful to conduct interviews with the operators of
other hotels nearby to learn about their operation and performance.

An important part of your competition analysis is estimating the monthly and annual operation
performance of each competitive property. Performance can be measured in terms of occupancy
percent and average daily room rate.

Occupancy Percent = Number of Rooms Sold / Number of Rooms Available

Average daily room rate = Total Room Revenue / Number of Rooms Sold

In addition to occupancy and average room rates, each competitive operation should be
carefully studied to determine its strengths, weaknesses and competitive position in the market
area.

Information on your competition can be obtained from interviews with management and:

American Automobile Association Tour Books
Mobil Travel Guides
State association and local lodging directories

You should also investigate any plans for other new lodging operations in the area. Too many
new rooms can lead to depressed occupancy levels and price wars. Local planners and the
development departments of hotel companies are usually aware of developments proposed for
your community. Use the following checklist to complete this part of your market analysis.

Location
Proximity to sources of demand
Accessibility
Visibility
Surrounding neighborhood

Facility
Age
Exterior appearance and condition
Interior appearance and condition
Cleanliness
Signage
Types of rooms (suites, standard room,...)
Food and beverage outlets
Function rooms
Recreation (pool, fitness center, )

Service
Quality of service
Extra services offered

Information from Hotel/Motel Managers
Weekday vs. weekend demand patterns
Historical occupancy growth or decline
Monthly occupancy levels
Number of 100% occupancy days per month
Average room rate per month (after any discounts)
Major market segments served per month
Major sources of demand

General Information
Number of rooms
Months open
Published rates
Franchise affiliation
Ratings in travel guides























5.0 Strategy & Implementation Summary

5.1 Competitive Edge

No one ever said it was easy to compete on service, however, the expectations of service are
often so low that todays businesses have an opportunity to gain a competitive advantage.
Lackluster customer service is often caused by declining people skills. Most people enter the
workforce with low service skills, but with proper training, it can increase dramatically. Often
companies spend their training on the technical side, but the companies that are competing on
service understand and provide training in customer service skills. This training does not
necessarily come in the form of an event or inspirational meeting, but a commitment a long-
term commitment to creating measurable standards and accountability through hiring, training
and execution that builds over time. By creating a service brand promise, together employers and
employees can create a shared vision that is written, understood and implemented. A service
brand promise doesnt have to be something that you advertise to the public, but it must be
unique and compelling and should be used as an internal marketing tool to reinforce your vision
to your employees. If you create and foster brand loyalty on the inside, you can sell it on the
outside.
There are a number of things to consider when creating your service culture. Walt Disney, with
the support of his brother, Roy, created an effective organizational model and efficient work
environment through culture building. Disneys tips for building a dynamic internal culture:
1. Keep it simple. Make everyone feel comfortable and leave room for individuality.
2. Make it global. Everyone must buy into it.
3. Make it measurable. Create specific guidelines that are part of the performance assessment
process.
4. Provide training and coaching. Incorporate the culture in the training and encourage peer-
to-peer coaching.
5. Solicit feedback and ideas from the team.
6. Recognize and reward performance. Build employee motivation through reward and
recognition.
Without execution, systems are nothing more than ideas. Consistent execution and a solid
process must be the responsibility of each employee. Employees must be empowered and
inspired to exceed customer expectations. Create an awareness of common opportunities where
employees can deliver exceptional service. Many service oriented companies use customer data
to build relationships with their customers. Customer data can include buying habits, personal
preferences, where they live and work, referrals, purchasing history, etc. Using this data builds
emotional capital and often tends to make price less relevant. But when employees can really be
a hero is through follow-up after a service defect.
A complaint is a gift. A complaining customer is willing to tell you for free whats wrong with
your business Unknown CEO
Analyze your most common customer service defects-the ones that may not be your fault, but
happen frequently. Ask your employees for a list of alternatives and recovery processes and
execute the best ones. When you foresee problems and are prepared for them, it is easier to
deliver exceptional customer service.
Take opportunities to measure customer service. Consider calling at least one of your customers
every week and asking them:
How are you doing? Whats your focus, challenges, priorities?
Whats going on in your industry/neighborhood?
What do you hear about our competitors?
How are we doing?
Consider measuring customer metrics such as: retention/resign rate of new customers, average
ticket, customer satisfaction, number of complaints (resolved/unresolved), customer referrals,
employee turnover and training hours dedicated to customer service. Determine: What is the
lifetime value of each of your customers? Perhaps a single customer spends $80 in your business
each month. Over a ten-year period they will have spent nearly $10,000 with you. What are you
doing to ensure retention? A satisfied customer is an economic asset with high return and low
risk.
Studies show that organizations that deliver exceptional customer service typically enjoy more
repeat business, less price elasticity, higher price points, more cross-selling opportunities, greater
marketing efficiency and a host of other factors that lead to earnings growth. A shift in focus
from profit to gaining a competitive advantage results in cultural changes that bring the objective
closer .