Shangri La Hotel Case Study

8647 Words 35 Pages
Register to read the introduction… New entrants need to have sufficient amount of budget in order to build and run the hotel such as require substantial upfront investment in building, specialized equipment, infrastructure and staffs. Products and services are easy to replicate in hotel industry, therefore, brand identity is the differentiator in the hotels. It is difficult for new entrants to gain access to the capital requirements needed to develop and build hotel. The industry’s incumbents have established relationships and experience, which enables them to achieve significant cost savings. In addition to brand loyalty and costs the new entrants must also contend with the probability of retaliation from the established hotels. The existing businesses in the industry have a high degree of absolute cost advantages as they have built good relationship and trust between the suppliers and …show more content…
It is considered as a partly unattractive industry because it has low entry barriers, medium to strong bargaining position of suppliers and buyers, strong competitive threats from product substitutes and intense rivalry among competitors.

4. Summary of Internal Analysis

Internal analysis is an analysis about the organisation itself, it finds out organisation resources and capabilities to create value to customers and identify area of weaknesses to be addressed by future strategic and evaluate core competencies (Evans, Campbell and Stonehouse, 2003). Acknowledging those resources and capabilities can understand company position and competitive advantage to achieve superior performance and profitability by strategic (Hill and Jones, 2012).

Resources

Tangible Shangri-la group comprises 110 hotels and resorts throughout Asia Pacific, North America, the Middle East and Europe. In future development more than 20 hotels and resorts will be built in variety countries. Revenue has growing up nearly a quarter from 2009 to 2010, US $1,729 million to US 2,145 million. But, Share of profit of associates of hotel operation total is 15.0, and property rentals total is

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