Hospitality Business Strategy: Impact of Macro Environment, Internal Analysis, Competitive Forces, and Strategic Planning of Premium Inn

Unit Title and Number: Hospitality Business Strategy (Unit 41)

Table of Contents
INTRODUCTION...........................................................................................................................2
Impact and influence of macro environment of Premium Inn....................................................3
Internal environment and capabilities analysis of Premium Inn.................................................5
Evaluation of Competitive forces of Premium Inn......................................................................8
Interpreting and devising strategic planning of Premium Inn.....................................................9
CONCLUSION..............................................................................................................................15
REFERENCES................................................................................................................................1

INTRODUCTION
Business strategies refers to the competitive moves and actions which the companies use
to attract the customers and achieve its organizational objectives. Business strategies are used as
a roadmap which leads the companies towards their desired goals (Umadia Sr and Kasztelnik,
2020). Hospitality industry is a category of service industry which involved food and beverage
sector, tourism, event planning, lodging and accommodations. It includes hotels, restaurants, bars
and tourism agencies.
The report will aim to discuss about the impact of macro environment, internal environment and
evaluation of competitive forces impacting the company. It will device strategic planning using a
range of models and theories.
Premium Inn is the largest hotel brand of British Hotel chain operating in a variety of
locations including airports and city centres. It is a subsidiary company in Whitbread Plc. It
offers 7200 rooms and 800 hotels. It was traded as Travel inn in 1987 so that it can compete with
Travelodge (Premier Inn. A hotel brand is setting standards, 2019).
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Impact and influence of macro environment
PESTLE Framework
Pestle Framework is the analysis of the external factors or the external environment of the
company which directly or indirectly affect the organization (Ghorbani, and Kazemizad, 2019).
There are 6 external factors. They are: Political, Social, Technological, Environmental, and
Legal factors. Through the use of these factors, the impact of external factors on Premium Inn
can be analysed:
Political factor: Political factor includes the policies that are run by the government and also the
interference of the government in company. This factor also includes tax policy, trade reforms
tariffs, etc. An impact of the political factor as the government of UK imposed taxes on the
corporate income and this directly affects the revenue income of the Premier Inn. Brexit policy
and VAT changes have also been introduced to the company which have hit its bookings rates. It
makes it difficult for the company to operate its business in other countries.
Economic factor: Economic factor includes inflation, economic growth, unemployment, interest,
cost of living and exchange, etc. These factors affect the economic condition of Premier Inn and

also the purchasing power of the customers that directly influence the demand and supply of the
products. Nowadays, UK faces some problems such as currency inflation, higher interest rates,
etc. due to COVID-19. The cost of energy going up which increases the operational costs if the
company. However, the conditions in UK are improving after COVID-19 because people have
again started to seek holidays in UK.
COVID-19 is responsible for the economic condition of the UK and the impact of this factor on
Premier Inn is that the profits of the company is decreasing. COVID-19 have badly affected the
economy of countries and many businesses. COVID have affected businesses as for as for a long
time there were lockdowns in many countries which have affected business of Premium Inn as
the tourism was dropped in UK and other countries as well. However, the company raised its
business through properly taking COVID protocols.
Social factor: Social factor includes customers and social organizations. The common factor that
affect the company is demand of the customers (Mir and Mir, 2019). For example: The consumer
demands changes every day and nowadays customers prefer hospitality companies who have
innovations such as better technologies which provides them better services and values.. This
affects the customer demands for Premium Inn. Lockdown have also affected on recruitment as
Illustration 1: Premium Inn hotel
Source: Premier Inn. A hotel brand is setting standards, 2019.