Business Environment Analysis of Travelodge Hotel Ltd.

This report provides a detailed analysis of the business environment of Travelodge Hotel Ltd. through SWOT and PESTEL analysis. It includes internal and external factors affecting the company's operations, such as political, economic, social, technological, legal, and environmental factors.

BUSINESS
ENVIRONMENT

Contents
INTRODUCTION ..........................................................................................................................1
MAIN BODY...................................................................................................................................1
Company overview......................................................................................................................1
SWOT ANALYSIS.....................................................................................................................2
PESTEL ANALYSIS..................................................................................................................3
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
The success of every business depends on adapting itself to the environment within
which it functions. The term business environment refers to the collection of internal as well as
external factors that effect the functioning of the business enterprise and how company works
directly or indirectly. It helps company's in identifying opportunities, providing assistant in
planning, ways to improve the growth and performance and how to increase profitability of the
businesses(Belyaeva, 2018).These factors include employees supply and demand, costumers
expectations and needs, supplier, client, market trends, social trends ,economic changes etc.
Travelodge hotel Limited is a private company dealing in hotels and hospitality with
headquarters in Thame, England , United Kingdom. Travelodge one of the largest independent
brand of hotels with over 575 limited hotel services across the United Kingdom. Travelodge is
the best choice for business travellers because it always provide its customers great value
services hotels in any location where they want to stay.
MAIN BODY
Internal factors are those factors that arises within the company and that factors can be
controlled by organisation. These factors directly put impact on the working and operations of
the company only. External factors are those factors that have potential to effect the business
performances from the outside. These factors put effect on all company's operating with in the
industry. Internal factors are controlled by the organisation whereas organisation does not have
any control over the external factors (Gogokhia and Berulava, 2021).
Company overview
Travelodge hotels Ltd. Operates chain of hotels in united kingdom. The company provide
various accommodation services to its customers such farm house, luxury rooms, guest rooms,
restaurants and other leisure services and facilities. Customers can also pre book any room online
by directly going on the company's website. Travelodge hotels serves their customers in united
kingdom, united states, Ireland and Spain. Travelodge is currently operating more than 595
hotels and 40250 guest bedrooms across the UK, Spain and Ireland. They are providing wide of
options to suit their customers budget more than 250 of their hotels own bar restaurants and
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almost all the located nearby to other restaurants cafe so that Travelodge can set a ideal base for
their customers when they are travelling.
SWOT ANALYSIS
SWOT analysis of Travelodge company to identify their strengths, weaknesses, opportunities
and threats.
Strengths
 affordable rates- Travelodge offers
rooms at very affordable rates whether
its family rooms or double rooms. On
special occasion they start early
booking deals and also promotions to
attract their customers and to boost
revenues.
 global presence- Travelodge is a
popular name in the hotel and
hospitality industry and currently
operating in united states, Canada,
Australia and in many more countries
having a strong business travellers
customer base(Page and Connell,
2020).
Weaknesses
 Financial debts- Travelodge was
facing financial problems from many
years and then pandemic simply
demolished the tourism sector and
hotel industry is simply dependent on
travellers. Travelodge was badly
effected by it and it was back at one
square with its debt burden quickly
pushing business to the brink.
 Public perception- As every traveller
wants higher value experience at
reasonable rates and they may have
more choices so this can be a
disadvantage for Travelodge because
most of the time they does fulfil
customers expectation.
Opportunities
 enhance technology- improving
technology proven to be a key strength
for the hotel industry. Travelodge can
also use chatbots in customer support,
they can also install robotic technique
for some services, and cloud
Threats
 Competition- competition among hotel
and hospitality sector is rapidly
increasing day by day because there are
many players in the industry who are
offering wide range of products ranging
from 1 star to 5 star. And people
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technology for saving resources.
 Market segments- Travelodge can
targets millennials because they love to
travel a lot. They can create a huge
opportunities for hotel and hospitality
industry. Travelodge can also plan to
expand its markets in European
countries this will increase their
reputation and profits also.
belonging to lower income group
always choose to stay at cheaper places
such as dormitories, hostels than
Travelodge.
 Changing travel patterns- After the
pandemic consumer behaviour has also
changed. Consumers are relaying more
on virtual and augmented reality which
is giving them more options to enjoy
travel without being travelling. This
will directly effect the hotel and
hospitality sector.
PESTEL ANALYSIS
Various macro environmental factors can impact business operations positively or adversely. To
analyse these factors and understand the market dynamics PESTLE analysis can be used. This
framework is imperative for companies like Travelodge and help them to make their business
better. In this analysis organisations evaluate various external factors like political, social,
economical, technological and legal factors which impact their business.
PESTLE analysis of Travelodge Hotel Ltd.
1. Political factors- the regulations of any particular government policies in a country can
highly affect the business's of that country. Political factors refers to the rules and
regulations that are fixed by the government and every organisation have to follow them
while carrying out their business operations (Tariq, Yasir and Majid, 2020) Travelodge
was also effected by digital protection Act which came into force in 2010 and
immigration policies also. the main purpose of introducing digital act was to reduce
amount of copyright and illegal files in the digital society.
2. Economic factors- Economic factors mainly focuses on the economic condition of the
organisation . This factors include inflation rates, interest rates, gross domestic products,
employment rates levels of disposable income etc. To target the lower income group
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Travelodge also started providing its services at cheap and affordable rates to its various
customers at their various hotels in U.K.
3. Social factors- Social factors refers to the changing trends, consumer beliefs in the hotel
and hospitality industry. Now a days everything is available online so people do not
prefer to books rooms manually or through telephone rather they will book it online
through the official website of the hotel (Madsen and Grønseth, 2022). Travelodge is
also considered as a sociably acceptable hotel in respect to trust pilot but the company
received mixed reviews from the website as well from other websites such as Trip
advisor. Company can also use social media platform to attract more customers by
designing their website in innovative and in attractive way.
4. Technological factors- In today's business world, technology is everywhere and it is
changing rapidly. It has also affected the e-commerce business's of the UK. Travelodge is
also affected by the changing environment of technology as the main business of the
company was by booking rooms and the fast advancement techniques have made the
market more competitive because various new techniques are developed by the
technology advancement.
5. Legal factors- Every country have a different legal structure and companies need to
study these structures carefully to minimise the chances of any future legal conflict. This
factors include all the legal considerations such as employment laws health and safety
laws , discrimination laws, intellectual property rights etc. which may affect the
functioning of the businesses. Travelodge is also affected by legal factors from time to
time because new laws can come into existence any time and this directly effect the
operations of the company.
6. Environmental factors- The environmental and ecological features that affects
functioning and consumer demand of an organisation. It include factors such as pollution
control, natural disasters, climate change impacts etc. this factor is also concerned with
sustainability in tourism which means being aware of the impacts of tourism on the
environment. Travelodge is also taking care of the environment by providing eco-friendly
accommodation rooms , organic foods, energy saving lights, solar thermal panels for hot
water, recycling the waste products and by using environmental resources in optimal
manner.
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CONCLUSION
In this report we have concluded that it is very important to analyse business
environment factors as it affects the functioning and decision making of the business. Different
business structure and size of a organisation have different effects on the business and scope of
business. We also discussed about the internal and external factors that effect the business
operations of Travelodge company. With SWOT analysis we find out about strength,
weaknesses, opportunities and threats of the company. We also applied PESTLE analysis tool to
identify the affect of political, economical, social, technological, legal and environmental factors
on the operations of the company. The analysis of correlation of strength and weakness with
macro factors was done, which helped us to understand how they influence decision making in a
business.
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REFERENCES
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