Development of a Five-Star Hotel Complex in Rotorua, New Zealand

Running Head: HOTEL MANAGEMENT 1
HOTEL MANAGEMENT

HOTEL MANAGEMENT 2
Executive Summary
The paper has analyzed the development of a five-star hotel complex in Rotorua, New
Zealand. In terms of methodology, the researcher comprehensively analyzed different sources of
information for data including accredited websites, reviewed journals, online publications,
previous researches, research databases, and books. It was found out that with a development
boom of hotels being underway in New Zealand, opportunities exist for the development of a
five-star hotel complex in Rotorua. Competition is moderate, with the market demand being high
now and is still expected to increase in the future since different customers prefer different hotels
according to their standards. The government’s policies and the economy in Rotorua are
favorable for the development of a five-star hotel complex in Rotorua, while the socio-cultural
factors and technological factors being a great advantage for the development of a five-star hotel
complex in the region. The proposed location for the hotel development at the slopes of Mount
Ngongotaha near Rotorua town is suitable as it is accessible due to good road transport systems
and minimum traffic count among other important factors. The location also possesses some
weakness including a low number of tourists, ineffective council permitting process, low
community support, low labor supplies and high costs of operating the hotel. Therefore, it was
found out that Rotorua market entry of the five-star hotel complex is recommendable and should
use innovative and product differentiation strategies as it will gain a higher market share within a
short duration. In conclusion, it is recommended that the five-star hotel complex should consider
benchmarking with the successful existing hotels within Rotorua so that it can learn more about
the environment the hotel is venturing into and the means of sustaining competition forces.
Table of Contents

HOTEL MANAGEMENT 3
Executive Summary.......................................................................................................................2
Introduction....................................................................................................................................4
Methodology...................................................................................................................................4
Market Demand Now and in Future............................................................................................5
C-PEST Analysis............................................................................................................................6
Competition Factors (Porter’s Five Forces)............................................................................6
Threat of New Entrants.........................................................................................................6
Bargaining Power of Customers...........................................................................................6
Industry Rivalry.....................................................................................................................6
Bargaining Power of Suppliers.............................................................................................7
Threat of Substitutes..............................................................................................................7
Political Factors..........................................................................................................................7
Economic Factors.......................................................................................................................8
Social Factors..............................................................................................................................9
Technological Factors..............................................................................................................10
Location Factors..........................................................................................................................10
SWOT Analysis........................................................................................................................10
Strengths................................................................................................................................10
Weaknesses............................................................................................................................11

HOTEL MANAGEMENT 4
Opportunities........................................................................................................................12
Threats...................................................................................................................................12
Discussion and Recommendations.............................................................................................12
Conclusion....................................................................................................................................13
References.....................................................................................................................................15