Case Study: Business Environment and Strategic Analysis of Premier Inn

This case study examines Premier Inn Hotel, a leading UK hotel chain, analyzing its organizational structure based on a vertically integrated model. The report delves into the business environment, considering factors like customers, stakeholders, competitors, and economic variables. A SWOT analysis reveals the hotel's strengths, such as high occupancy rates and strategic locations, alongside weaknesses like limited global presence and past refund issues. Opportunities include market expansion, while threats include competition and potential legal challenges. The PESTEL analysis assesses political, economic, social, technological, legal, and environmental factors impacting the hotel. The political analysis highlights the impact of the COVID-19 pandemic, while economic factors address investment and expenditure trends. Social factors focus on local engagement, and technological factors emphasize the importance of internet-based media. Legal factors cover regulations, and environmental factors address sustainability initiatives. The study concludes with a comprehensive overview of these analyses, offering insights into Premier Inn's strategic positioning and operational challenges.

CASE STUDY

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Organizational Structure of Premier Inn Hotel............................................................................3
Business Environment Analysis of Premier Inn Hotel................................................................4
SWOT Analysis...........................................................................................................................4
PESTEL Analysis........................................................................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
In its operational nature, the business organization interacts with numerous factors in its
environment which can be in terms of acquiring the inputs, returning back the outputs and
utilizing the feedback for changing the inputs and the transformation process. Also, the business
does not execute in a vacuum but must have an interaction with its environment in order to
implement its functions. Although, the level of interaction can differ depending upon the
organizations and its influence can also differ over the course of time.
Premier Inn is a limited service hotel chain in British and the largest hotel brand in UK
and also it has more than 800 hotels and 72,000 rooms. Is operational activities takes place in a
variety of locations involving the airports, suburbs and the city centres that competes with the
likes of Travelodge and the Ibis hotels. The hotel also lead the YouGov hotel brand index and
has also retained the title as 'Best Value Hotel' for the sixth time. Moreover, 618 of the hotels of
Premier Inn have also won the TripAdvisor's Certificate of Excellence which is given to the
hotels that consistenly receive the outstanding guest reviews. This report will discuss the
Organizational structure of the hotel, its business environment analysis, SWOT analysis and the
PESTLE analysis (Brunet-Thornton and Martinez, 2018).
MAIN BODY
Organizational Structure of Premier Inn Hotel
The organizational structure is the system which is used to specify a hierarchy in an organisation.
It is used in outlining the job, power, role and function that are allocated and the way in which
the information flows between various levels of the management. It also depends upon the
objectives and the strategies of the organisation. Premier Inn Hotel executes on a single model
which is known as the 'Vertically Integrated Model' that combines the property, functionality of
the hotel, stock dispersion and brand that has let them to be developed effectively and efficiently.
Moreover, the organisational structure makes sure the basis of gender equality, as a hospitality
company, it staffs a number of employees in its staff operations with a decreased number
working in the support centre. They have almost 96% of their 35000 UK employees working in
the customer facing teams in its 1255 locations that are located in their hotels across the country.
66% of the position is filled by the women paid on the basis of hour. The staff is highly
employed on the operational activities with major positions dominated by the females. In
addition to that the organisation believes on paying equally for the equal work and is fulfilled

that it has in place the important processes to make sure that its payment practices do not
discriminate on the basis of gender (Amankwah-Amoah and Adomako, 2019).
The board of the Premier Inn. Hotel includes the chief executive, chairman, group HR director,
group finance director and other various non-executive directors.
The Whitbread Executive Committee includes the PLC executive Directors and other various
senior executives. The operating model of the company includes components that are the brand
strength, direct digital distribution, property flexibility, scale advantage, operational control and
the everyday efficiency. This operating model offers the clear competitive benefit offering its
customers with high-end services.
Business Environment Analysis of Premier Inn Hotel
It is regarded as the build-up set of all the internal and the external factors like the customer
needs, employees and the expectations, etc. The components that creates an influence on the
operational activities of the company are the customers, stakeholders, rivals, legislation,
suppliers, industrial trends, technological changes, social and economic variables and other
government actions (Arnaout and Esposito, 2018).
SWOT Analysis
Strengths
The occupancy rate of the company is more than 76.3%. Most of the customer like its pillows,
blackout curtains and the cosy duvet because of which it is in a better position in the hospitality
industry. It has around 80000 hotels in UK which has 8 lakhs rooms and also it provides a good
number of its hotels in Germany also. The locations of the hotel are generally near the airports
and the tourist attractions while some are near the universities also.
Weaknesses
It has its presence across the globe but in a limited way. The hotel has also been accused of some
refund issues during the time of lock down which made numerous customers unhappy, and also
faces the issues related to the hygiene in which the trade union displayed concern regarding the
exploitative work practices of Premier Inn (Mufudza, 2018).
Opportunities
The opportunities of the hotel includes the exploration of the new markets after entering
successfully in Germany, it has been offered the Republic of Ireland also. It has 28 hotels in
Germany and the nation also provides potential growth opportunities for the hotel because it is

also the most visited tourist countries in Europe and worldwide. There is an upcoming room
design and decoration which is a good surprise to the guests.
Threats
The competitors are one of the main threats which are the Holiday Inn, Marriott, Easy hotel, Ibis
and many other independent and small hotels. Also, there is a risk of the legal activities against
the hotel if it does not take the actions when needed from the trade unions and the safety and
health executives. Due to the lock down, many businesses suffered in the past few days and
situation came out to be challenging and got affected very badly.
It was argues that the Premier Inn is going to be the leader in the budget hotel segment in the UK
though the hotels, restaurants and the coffee shops acclamate each other, the company has a
competitive model that is difficult to be imitate by others (Maseh and Moseti, 2019).
PESTEL Analysis
Political factors
The recent COVID-19 pandemic led to the shutting down of the whole travel industry which
made the company to lose the tourist customer and got to experience the worst situations.
Premier Inn has the important technology infrastructure like the powerful internet access. Also, it
has acquired enough income over the last 4 years before the pandemic arrived.
Economical factors
The most profit making investment sector for the international investors is the hotel industry.
The prevailing monetary situations of UK are getting worsened. The enhancemnet in the
expenditure design of the society creates an influence on the society. It also assures the nice
environment, great customer service and the high-quality lodging as they are committed to learn
more about the customers (Truong and Barraket, 2018).
Social factors
The company is emphasizing on the local areas, creating new positions on a regular basis and
developing a compatible commitment to the society with the help of foundation of the schools,
preparation of programmes and the charitable drives. The Hotel also depends upon the tourism
which is both internal and external, the seasonal holidays like the Easter, Christmas and the bank
holidays which are necessary dates that the company targets which led to the people to spend
more in this time period.
Technological factors

The capacity to acquire the company's profits is by the developing use of the internet based
media and the internet innovations has become important. The local area groupings of the
people, web persuings and the region may be specifically emphasizes on only the online media.
The developing use of the existing correspondence innovation may signify the danger to the
importance for the travel related to business. The future potential threat regarding the use of the
existing communication technology that lowers the demand for the business travel, which
decreases the future potential customer base for the company (Romanelli, 2018).
Legal factors
Modifications in the legal framework may have an important effect on the company and it can
create an impact on the management of the company. It the location of the hotel is in the high -
crime region then the profit of the hotel can be influenced. According to the menu that requires
the usables to be correct about the intake of calories in the healthy and the nutritious meals. One
of the recent changes in the legislation that has influenced the minimum wage by 12p in October
2013.
Environmental factors
The environmental change across the globe can affect the company in a serious manner. The
initiative of the company which is the “Good Together” initiative is the campaign which is
intended to create the company into more environment friendly. The company also has set up the
energy conservation lighting and the water-productive showers to decrease the wastages (Fabus,
2018).

CONCLUSION
The above report discussed the organizational structure of the Premier inn hotel, the
business environment analysis of the hotel, its SWOT analysis and its PESTLE analysis. The
environment of the organization has a great influence on the functioning of the company. It
provides opportunities and threats with the limitations and the pressures creating an impact on
the functioning and structure of the business.
The PESTEL analysis emphasized on the external environmental factors that created an
influence on the business while the SWOT analysis emphasized on the internal as well as the
external factors. The PEST also examines the political and the legal aspects of the business by
specifying the laws of employment, issues related to politics, regulations and the taxes that
impacted on the business. Both the SWOT and the PESTLE analysis are used in making a
systematic and complete evaluation of the new project or business which gave improved
awareness to the decision-makers about the understanding of the changes that could occur and
create an impact on these changes might have on the company.

REFERENCES
Books and Journals
Amankwah-Amoah, J. and Adomako, S., 2019. Big data analytics and business failures in data-
Rich environments: An organizing framework. Computers in Industry, 105, pp.204-212.
Arnaout, B. and Esposito, M., 2018. The value of communication in turbulent environments:
how SMEs manage change successfully in unstable surroundings. International Journal
of Entrepreneurship and Small Business, 34(4), pp.500-515.
Brunet-Thornton, R. and Martinez, F. eds., 2018. Analyzing the impacts of industry 4.0 in
modern business environments. IGI global.
Fabus, M., 2018. BUSINESS ENVIRONMENT ANALYSIS BASED ON THE GLOBAL
COMPETITIVENESS INDEX (GCI) AND DOING BUSINESS (DB): CASE STUDY
SLOVAKIA. Journal of Security & Sustainability Issues, 7(4).
Maseh, E.J. and Moseti, I.M., 2019. Managing Records in Networked Environments in Kenya's
Public Sector Organizations: A Literature Review. Mousaion, 37(1).
Mufudza, T., 2018. Dynamic strategy in a turbulent business environment. Strategic
Management-a Dynamic View.
Romanelli, M., 2018. Museums creating value and developing intellectual capital by technology:
From virtual environments to Big Data. Meditari Accountancy Research.
Truong, A. and Barraket, J., 2018. Engaging workers in resource-poor environments: the case of
social enterprise in Vietnam. The International Journal of Human Resource
Management, 29(20), pp.2949-2970.