Amber Inn & Suites Case Study Essay

1310 Words Jan 1st, 2014 6 Pages
Case Study #4: Amber Inn & Suites

Work Environment Amber Inn & Suites, Inc., formed in 1979, operates 200 Amber Inn properties and 50 Amber Inn & Suites properties located in 10 states throughout the Rocky Mountain and western states. On Average, each location has approximately 120 individual guest and suite-style rooms. Under a new president and CEO, the goal is for Amber Inn & Suites to reach profitability within two years after five consecutive years of unprofitability. This company is positioned as a limited-service hotel which does not have the amenities such as a restaurant, lounge, or meeting rooms. This type of hotel is classified under a midscale hotel with food and beverage, such
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Even though profitability has not been able to be reached, the company has still been able to produce three consecutive years of growing revenues. The average occupancy rate is higher than the industry average for the respective class the hotel is in, and Amber has a significant standing amongst business travelers.
The glaring fact of being unprofitable for five consecutive years is definitely the major weakness of this organization. Lodging revenues are rising, but the expenses correlated with these revenues are increasing at a much faster rate. Other weaknesses are the lack of amenities that Amber Inn & Suites offers travelers, which creates a lack thereof to differentiate from other hotels with the same presence. Another item that could be a weakness is a lack of differentiation between the Amber Inn and Amber Inn & Suites.
By having noticeable differences between the two, this could allow for different price structures and allow Amber Inn to enter a new target market giving the organization the ability to expand its chain. Also, with a dominant business traveler occupancy rate, Amber Inn & Suites could start forming frequent visitor relationships with organizations, so those companies refer their business travelers to stay in these sites.
With having so many consecutive years of unprofitability, the thought of bankruptcy or closing of the organization is

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