Analyzing High End Hotels Using Porter's Five Forces in the UK Market

This essay provides an analysis of High End Hotels using Porter's Five Forces model, with a specific focus on the UK market. The introduction establishes the framework, emphasizing the importance of buyer power and the threat of substitution. The essay delves into how these forces impact High End Hotels' operations, profitability, and customer satisfaction, particularly in the context of the UK market's economic conditions post-Brexit. The analysis explores the influence of customer purchasing power, the impact of competitors, and the challenges posed by substitute services. It also discusses the strategic importance of pricing, quality, and innovation to maintain a competitive edge and attract customers. The conclusion highlights the need for strategic planning and adaptation to address these challenges and capitalize on opportunities within the UK market.

Essay

Table of Contents
INTRODUCTION...........................................................................................................................1
Essay.......................................................................................................................................1
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
The Porter five force model helps in effective management of the various operations that
helps in the effective management of the various operations of an organisation. The power of
buyer and the threat of substitutes is the two most important constituent part of the Porter's Five
force model (E. Dobbs, 2014). For this report, High End Hotels as the organisation of context.
This report will focus on its high standards that are been required to be followed by High End
Hotels. Besides this, the report will lay emphasis on the power of the buyer or the customer of
the company and the threats it possesses due to substitution in UK market.
Essay
In the recent time the High End hotel companies had faced the stiff competition from
various competitors in the market that had affected the profitability and customer satisfaction
along with the market base that has laid a deep impact on the revenue generation of the company.
Other than this, the entry of new competitors giving better substitute of the services to the
customer's as compared to that of High End hotels. The various factors that are been described in
the Porter's Five Force model, such as the power possessed by the buyers or threat of substitution
that plays a crucial role in executing of the various business operations and the will help the cited
firm to expand its business in the UK market. The competitors and customers of a business lay a
very deep impact on the various operations that helps the company to alter its work processes
and maintain its productivity and profitability in the company that helps the company to meet the
requirements of its customer's in a very effective manner (Mathooko and Ogutu, 2015).
The two major business affecting factors and their effect is as follows:
Power of Buyer: The buyers or the customers of the company lay a very deep impact on the
effective execution of the management of the various operations in the company. The customer's
perspective and their purchasing power or number impact the prices and the services of the cited
business firm. As the Marriott is planning to expand its business in the UK's market, and want to
open a high standard hotel in UK. This help the cited firm to meet the requirements of the
customers in a very effective manner and increase its profitability and productivity by providing
the customers with the effective services and products from the company (Greenspan, 2015).
Other than this, the effective management of the various operations helps the company to meet
the requirements of the company and fulfil the needs and demands of the customer's. As the High
End hotels want to establish a 5 to 7 star hotels in UK, it must take into consideration the
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effective needs and demands of the customer's. His will help the company to effectively meet the
requirements of the customer's of the UK's market. As after the Brexit, the UK has faced the
economic disturbance to a greater extent. The economy had suffered very badly and is required
to be taken into the consideration by the business organisation. Many of the businesses had faced
severe losses and there have been an enormous rise in the unemployment and lack of foreign
investments. Thus, to sustain its economy, UK is seeking of the foreign investment. In this case,
High End hotels can invest into the UK market. Although the conditions are not quite favourable,
but this investment will help the cited firm to increase its business in the market and aid in the
growth of the various operations that can be taken into the consideration by the company to
improve the quality of various services and products that are been offered by the High End hotels
(Hove and Masocha, 2014).
Other than this, the company has the effective chance to get the high number of the
potential work force that will help the company to improve its productivity and profitability of
the cited firm. But the most crucial factor that is to be taken into the consideration by the
company is the perception and the buying capacity of the customer's in UK. As the economy is
been down and the financial conditions of the majority of the potential customer's is been in
turmoil, the cited business has to look after the effective management of the various operations
that help the company to gain a better productivity and profitability. To attract the maximum,
number of the customer's or buyer's, the company has to look after the effective management of
the pricing of its services and products that will help the firm to penetrate in the market more
effectively. Although, the local and the global competitor's will also affect the operations of the
Marriott in the international, especially the UK market that may affect the overall operations of
the company in the international scenario. The cited business have to meet the requirements of
the customers in order to have a better return of investment and revenue that is been provided
and seek by the investors and the stake holders of the company. The effective rise in the demands
of the customer's may lead to affect the business operation's of the company and is meant to be
fulfilled effectively (Porter and Heppelmann, 2014.). The high pricing of the services and the
products by the High End hotels may make the customer's reluctant to purchase them and look
after for the cheap or economic alternative, impacting the sales and business of the company.
The firm has to look after the effective pricing strategy to attract, sustain and retain the
customer's. The providing of the good quality products or the services on the low or the
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reasonable cost will lay a very deep impact on the operations of the company. Besides this, the
effective pricing will help the company to regain the loyal customer base and meet the
requirements of the company to have a better productivity and profitability and buyer's trust over
the cited firm (Sutherland, 2014.).
Threat of Substitution: The High End hotels also faces the effective management of the various
operations that will reduce the chances for the customers to see after the substitution of its
services and products. The customer turning towards the substitution of the product or the
services that are been provided by the business firm will lead to the decrease in its revenue,
market share and effectiveness in the market (Ortega, Jalón and Menéndez, 2014). Besides this,
the competitors can come up with the effective alternative for the services or the products, that
are been provided to the customer's by the cited firm. For instanced, the product or the service
that is been provided by the High End hotels to its customer's on a higher cost, the competitor
firm provide it on a nominal cost to the customer, affecting the customer base of the former.
Other than this, the alternative or the substitution may also affect the customer perception about
the company and may cause the business firm to lose their valuable customer's. Although, the
quality standards of the cheap alternative or substitution in the market and helps them to meet the
operations of the company to fulfil the demands of the customer's and get them a better
profitability and productivity (Indiatsy and et.al., 2014). Other than this, the substitution may
impact the market share of the company and will lead to the decrease in growth of cited firm.
Besides this, the presence of the cheap and the low quality product or substitution will affect the
market position of the company and will lead to the downfall of the standards set in the market.
The efficient management of the substitution of the product or the services by the High End
hotels will require the effective planning and strategy that has to be look after by the Cited
business firm. As the economic condition of UK's market is low, and weak, there are high
chances of the development of the alternative's or substitution. In this case, it will not only affect
the brand image of the company as a 5 or 7 star hotels but also effect the profitability and
productivity (Fung, 2014). To cope up with this, the company can look after the effective
management of the various operations that will lay a very deep impact on the operations of the
company (Zhao and et.al., 2016). Other than this, the company has to convince its customer's
about the poor quality of the substitutes of their products or services, that are been provided by
the firm to its customer's or buyers. They have to look after the effective management of the
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various operations that are been carried out in the market to attract the maximum number of
customers. It the alternative product or the service is easy to find, on a low cost, it will impact the
capability of the firm to meet the requirements of the company in an effective and efficient
manner, weakening its market position and hold over the customer's. There are many products or
services available in the UK market that can effectively substitute the High end hotels due to
their economical services available on the reasonable rates and easy accessibility. This can
impact the overall functionality of the high end hotels in UK affecting their customer base and
revenue.
High End hotels can also use the various legal measures to keep a check on the
substitutions that can affect its business operations on a wider scale. Besides this, the pricing of
the various operations that are been taken into the consideration by the business firm will help
the company to meet the requirements of the company to fulfil the needs and demands of the
customer's of company in a very effective manner. Other than this, the High End hotels can use
the approach of innovation in their products or services that will help the firm to meet the
requirements of the buyers or the clients (Dälken, 2014). This will attract the customer's towards
the cited firm and will lead therm to purchase the product or services developed and provided by
the company. Other than this, the approach of substitution can affect the development and
providing of the various products or services to the customer's. In case to find the cheap
alternative or substitution on the local level, the client or the customer's can outsource it,
affecting the profit margin and market position of the company on a greater and wider level.
High End hotels has to effectively adjust or reconfigure its market strategy in order to expand its
business in UK (Rothaermel, 2015.). The number of competitors also lay a deep impact on the
overall operations of the company. The higher the number of the competitors in the market,
number of the substitution of the services will be higher too. Thus, the cited business firm has to
look after the effective management of the competitors and meet the operational requirements of
the company, that affects its profitability and the return of interest and investments that is been
incorporated by the stake holders and the investors of the firm.
The High end hotels in UK helps in the better management of the various operations in
the company. These hotels provide the better services and look after the effective customer
satisfaction level. Besides this, they offer a wide variety of the services like spa, indoor sports,
travelling facilities and good quality of accommodation in the reasonable prize. This is the main
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factor that attracts the large number of customers to get the services from the high end hotels in
UK. This has improved the overall functionality of the in the High end hotels of UK. Besides
this, the better management of the different operations can lead to the effective handling of
different operations that will lead to rise in the customer satisfaction level and leads to better
revenue generation.
The main reason behind more number of tourists or the customers are visiting UK is the
tremendous rise in the different high end hotels that are providing the better services to its
customers on a reasonable cost. Besides this, the increase in the economic stability and income
of people in the recent years, improvement in the modes of transportation and travelling and
better assessment of the needs and demands of the customers using the feedbacks and rating
given to the High end hotel on the basis of the various services provided to them. Also, the better
trust level build by them is the key factor to attract maximum number of tourists.
CONCLUSION
Thus, from the report it can be concluded that the various factors plays a very crucial role
in the management of the various operations of High End Hotels in UK. This report focused on
the meeting of high standards of High End Hotels. Besides this, the report laid emphasis on the
power of the buyer or the customer of the company and the threats it possesses due to
substitution in UK market. The report also included a brief analysis of the market conditions for
the company to make expansion and enter into a new market along with the analysis of the
competitors of the cited firm.
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REFERENCES
Books and journals
E. Dobbs, M., 2014. Guidelines for applying Porter's five forces framework: a set of industry
analysis templates. Competitiveness Review. 24(1). pp.32-45.
Mathooko, F.M. and Ogutu, M., 2015. Porter’s five competitive forces framework and other
factors that influence the choice of response strategies adopted by public universities in
Kenya. International Journal of Educational Management. 29(3). pp.334-354.
Greenspan, R., 2015. Walmart: Five forces analysis (Porter’s model). Panamore Institute.
Hove, P. and Masocha, R., 2014. Interaction of technological marketing and Porter’s five
competitive forces on SME competitiveness in South Africa. Mediterranean Journal of
Social Sciences. 5(4). pp.254.
Porter, M.E. and Heppelmann, J.E., 2014. How smart, connected products are transforming
competition. Harvard Business Review. 92(11). pp.64-88.
Sutherland, E., 2014. Lobbying and litigation in telecommunications markets–reapplying
Porter’s five forces. Info. 16(5). pp.1-18.
Indiatsy, C.M. And et.al., 2014. The Application of Porter’s Five Forces Model on Organization
Performance: A Case of Cooperative Bank of Kenya Ltd. European Journal of Business
and Management. 6(16). pp.75-85.
Zhao, Z.Y. And et,.al., 2016. Competitiveness assessment of the biomass power generation
industry in China: A five forces model study. Renewable Energy. 89. pp.144-153.
Dälken, F., 2014. Are porter’s five competitive forces still applicable? a critical examination
concerning the relevance for today’s business (Bachelor's thesis, University of Twente).
Rothaermel, F.T., 2015. Strategic management. McGraw-Hill Education.
Fung, H.P., 2014. Using porter five forces and technology acceptance model to predict cloud
computing adoption among IT outsourcing service providers.
Ortega, A.G., Jalón, M.L.D. and Menéndez, J.Á.R., 2014. A strategic analysis of collective
urban transport in Spain using the Five Forces Model. Investigaciones Europeas de
Dirección y Economía de la Empresa. 20(1). pp.5-15.
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