Strategic Analysis of Radisson Blu Plaza Hotel in Sydney Market

This report presents a strategic analysis of the Radisson Blu Plaza Hotel, focusing on its operations in the Sydney market. The report utilizes PESTLE analysis and Porter's Five Forces to evaluate the external factors and competitive forces influencing the hotel's performance. The PESTLE analysis exam...Read More

Hospitality management’s stimulations
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Management 1
Executive summary
In the dynamic environment, it is essential for the company to evaluate their current situation
which has been done with the help of the tools like PESTLE analysis and Porter’s five forces
which show the external factors and competitive forces which influence the working of
company. The company that has been selected for Radisson blu plaza hotel which is
performing their business in Sydney market. The findings of report show different
opportunities as well as threats that can influence the operations. The threat of competitors as
well as bargaining power of customers is high in market which affects working of Radisson
blu.

Management 2
Contents
Introduction................................................................................................................................3
PESTLE analysis........................................................................................................................3
Porter’s five forces.....................................................................................................................5
Conclusion..................................................................................................................................8
References..................................................................................................................................9

Management 3
Introduction
The aim of the report is to present the report on the international hotel chain considering the
tactical as well as the strategic management decision that contribute in enhancing the market
share as well as evaluate the current economic and financial data to inform about managerial
decisions. The report explores about present situation of Radisson blu plaza hotel in the
international market with the help of the two theoretical models which include Porter’s Five
Forces Analysis and PESTLE Analysis. Radisson Blu Plaza Hotel is an intimate, boutique
style as well as five-star hotel housed in a stunning heritage-listed building. The company has
its hotels in different countries and hotels situated in Sydney is features with 364 stylish guest
room with the eight meeting rooms that consist of two with natural light, a Health Club, The
Fax Bar and the other complimentary internet access.
PESTLE analysis
PESTLE analysis is a framework that consists of the external factors that can influence the
working of company. Radisson Blu Plaza Hotel makes use of this tool to evaluate the present
situation in international market.
Political factors: - Radisson Blu Plaza Hotel determines the value of regulations and laws of
the nations to act accordingly. The company has wide opportunities in the market because
government supports the hotel as well as hotel follow the protocol that is designed by the
individual nation linked to the smoking policy, non-fat food, diet with low calorie (Radisson
Hotel Group, 2019).
Economic factors: - The economic factors are considered by the company as it influences the
working. Considering the economy of Australia, GDP was equal to 1432.20 billion US
dollars in the year 2018 which is equal to 2.31% of the total world economy. In addition,

Management 4
GDP of the country is expected to improve and leads to rise in purchasing power (Trading
Economics, 2019). This improvement in economy will make the people to make plans and
visit different areas for which they book Radisson blu Plaza Hotel and avail the services.
Similarly, it leads to the threat because most of the tourist doesn’t visit the areas where
economy is high as they have to pay more amounts so they wait for recession period which
affects the sales of Radisson blu.
Social factors: - The social factors include the change in trends and patterns of customers
within the market. In the market, the customers like to stay in the hotel that is equipped with
the different features and facilities that can enhance their experience (Hutt & Speh, 2012).
Considering the needs of customers Radisson blu include gym, a rooftop restaurant, modern
rooms and many others. In addition, there are opportunities that company will bring more
changes in their services. However, the introduction of Airbnb has grab the attention of
people and they want friendly and home feeling which is leading threat for company.
Technological factors: - The up-gradation and change in technology has become one of the
major reason due to which working of companies gets affected. The use of effective
technologies like internet, online booking and improvement in number of guests contribute in
improving the business. Radisson blu make use of technology for the best online rate
guarantee; provide the exclusive member benefits that include discounts, beverages and many
others (Radisson Hospitality, 2019). In addition to this, the technology is also used by the
hotel in making the good reputation as well as position in market by making effective use of
marketing. The digital marketing leads to good opportunity in attracting more customers.
Legal factors: - The legal factor can influence working due to which Radisson blu need to
change their processes. The company consider the minimum wage slab act according to
which they provide salaries to the employees (Hutt & Speh, 2012). Along with this, the

Management 5
changes in the regulations are adhering towards the services that are offered by Radisson blu
for the benefits of customers.
Environmental factors: - The environment is one of the major concerns towards which
every company need to perform their obligations. Radisson Blu Plaza Hotel has the long
history that is responsible for the business and makes them passionate for caring other as well
as extends beyond the walls of hotel (Radisson Hospitality, 2019). The company has thinking
of Think People, Think Community and Think Planet. Radisson Blu Hotel has contributes
effectively in reducing 2.1% of less energy per m2 with this they have 207 hotels which are
certified with the safe hotels alliance. The water which is natural resources has been reduced
with 3.5% per guest night and they have donated €1.0m to charity for welfare (Radisson
Hospitality, 2019).
Porter’s five forces
The porter’s five forces is a framework that shows the separate forces with the motive to
extent the competition within the forces (Hitt, Ireland & Hoskisson, 2012). The managers of
the Radisson blu consider this tool with the motive to analyse the competition.
Porter’s five forces Description
Bargaining power of
customers
Radisson Blu Plaza Hotel belongs to the premium
category due to which there is presence of high
competition or rivalry in the market. The major
competitors of the company include Hyatt Regency,
Marriott, Sheraton and many others dealing in the market
of Australia. These companies have their extended hotels
in the market which affects the Radisson Blu Plaza Hotel.
Bargaining power of suppliers Bargaining power of suppliers influence the working of

Management 6
company as they are the one who hold the power (Kotler,
Keller, Ang, Tan & Leong, 2018). Radisson Blu has no
supplier switching cost and power of supplier is low
because brand value of company helps them to attract the
maximum number of suppliers who can contribute in
offering the services effectively.
Bargaining power of
customers
In the market, bargaining power of customers matters a lot
for Radisson Blu Plaza Hotel. The bargaining power of
customers remains high for hotel as there is availability of
different premium segments that can influence the buying
decision of customers (Radisson Hospitality, 2019). The
different factors which influence the buying behaviour
involves social factors, online rating, views and
experience of customers and many others.
Threat of new entrants The threat of new entrants is low in the market as
Radisson Blu Plaza Hotel belongs to high and premium
segment due to which other small companies can’t give
competition (Wilson & Gilligan, 2012). Along with this,
business who wants to enter in hotel need to investment
high capital and also required to form a good brand
position. Thus, this makes low level of threat for the new
entrants in market.
Threat of substitutes The threat of substitute is moderate as most of the people
stay at their friends and family residence due to which
they don’t visit Radisson Blu Plaza Hotel which affects

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their business. Along with this, the emergence of Airbnb
has also affects the company by arranging or offering
lodging, primary homestays as well as enhancing the
tourism culture by providing the home stay that leads to
cultural values. However, this has been found that there is
most of the Hotel who are able to find that people who
visit for tourist purpose, business meetings and others stay
in hotels only.

Management 8
Conclusion
In the end of the report, this has been found that PESTLE analysis reflects that there are wide
opportunities available for Radisson Blu Plaza Hotel in market which gives them the chance
to improve their operations in Australia. Along with this, there is high threat which is majorly
from change in the needs of customers towards the company. In the analysis of Porters five
forces, this has been found that Radisson Blu Plaza Hotel deals with high threat of rivalry and
customers can easily substitute.

Management 9
References
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2012). Strategic management cases:
competitiveness and globalization. Cengage Learning.
Hutt, M. D., & Speh, T. W. (2012). Business marketing management: B2B. Cengage
learning.
Kotler, P., Keller, K. L., Ang, S. H., Tan, C. T., & Leong, S. M. (2018). Marketing
management: an Asian perspective. Pearson.
Mudie, P., & Pirrie, A. (2012). Services marketing management. Routledge.
Radisson Hospitality. (2019). Every moment matters. Retrieved from:
https://www.radissonhospitalityab.com/static-files/a7468b92-841f-4c5f-9b63-
5815c6b48697
Radisson Hotel Group. (2019). Radisson Hotel. Retrieved from:
https://www.radissonhotels.com/en-us/?
facilitatorId=GOOGLEAMERCO&cid=a:ps+b:ggl+c:amer+f:en-
us+g:cl+i:generic+r:gnr&gclid=EAIaIQobChMI9dqojbeo5AIVy4BwCh2SAAQEEA
AYAiAAEgKfhPD_BwE
Radisson Hotel Group. (2019). Responsible Business. Retrieved from:
https://www.radissonhotelgroup.com/responsible-business
Trading Economics. (2019). Australia GDP. Retrieved from:
https://tradingeconomics.com/australia/gdp
Wilson, R. M., & Gilligan, C. (2012). Strategic marketing management. Routledge.