Priceline Group Inc: Legislative and Business Analysis Report

This report provides an analysis of Priceline Group Inc., a website company specializing in discount rates for airline tickets and hotel stays. It examines the company's operations, focusing on how it is affected by legislative and regulatory factors, particularly taxation. The report explores the impact of high taxation on Priceline, including its effects on consumer prices, company profits, and debt. It also discusses the company's strategies for mitigating these challenges, such as passing tax burdens to consumers and seeking external capital. Furthermore, the report details Priceline's various agreements with suppliers, data providers, and other companies like Agoda, KAYAK, and Rentalcars.com, highlighting how these partnerships contribute to its business model and customer service. The report concludes by summarizing the key findings regarding Priceline's operations and its responses to external pressures.

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Priceline group Inc
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Executive summary
In this report we are going to discuss about Priceline Company. Priceline is a website company
helping its users in finding discount rates of airline tickets and hotel stays. The company helps its
clients purchase their services directly from the supplier. In our discussion we will discuss how
the company is affected by different factors in the long run. Some of the factors which affect the
Priceline Company is legal which are made in parliament such as paying of taxes among other
things.

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Table of Contents
Introduction......................................................................................................................................4
Legislative regulatory......................................................................................................................4
Paying of taxes.............................................................................................................................4
Passing burden to consumers.......................................................................................................5
Running into debt........................................................................................................................6
Company and an agreement.........................................................................................................7
Treaties with other companies.........................................................................................................8
Agreement....................................................................................................................................8
Serving customers better..............................................................................................................8
Rental cars...................................................................................................................................9
Conclusion.......................................................................................................................................9
References......................................................................................................................................11

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Priceline group Inc
Introduction
Priceline is a website company helping its users in finding discount rates of airline tickets
and hotel stays. The company helps its clients purchase their services directly from the supplier.
This helps the consumers to get products at a cheaply or low cost (Lie, 2018). This helps them to
get more revenue and profit in the long. Priceline has its headquarters in Connecticut, United
States. Priceline operates in a consumer service industry, and it seeks to offer the rates of flight
and hotels at a lower price. Priceline has a total of 22,900 employees globally with 1086 coming
from Australia (Faff, Kwok, Podolski, and Wong, 2016).
Legislative regulatory
Paying of taxes
Priceline is affected by the legislative framework as the government charges them highly.
Due to the high taxation, the tickets of the airline is not necessarily cheaper, but it charges a
lower price compared to the prices normally charged. Due to the taxation the company does not
attract more clients due to fewer prices that will be saved when one books their services with
Priceline. Multinational companies are subjected to a 30% corporate tax, and this has led them to
charge the consumer as part of the strategy of reducing the burden of taxation (Bocci, Larson,
and Wu, 2018). With the taxation, both the consumer and Priceline are affected since the
customers will have to incur additional cost while the profits of the organization will have to
reduce. Taxation is one of the way every government in the world get capital to fund its project.
Majority of countries which collect increased tax from its citizen is rich country compared to one
which collect less taxes in the long (Lockhart, 2016). Every business requires security from the
government and as a result of this, for the government to offer security for the business, every

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business, firm, organization, company or institution must pay taxes to the government. That tax
is used to provide essential services in the long run. This is the reason I support the government
to collect tax from Priceline group Inc (Crossley, and Obeng-Darko, 2018).
The Australian government taxes the multinational Corporation since they affect the
operation of companies that have been operating in the country. The foreign company can affect
the existing company in a country and to avoid this regulation are placed for them to reduce the
inequality that might arise. The taxation of Priceline has affected the company since they have to
cut their operation cost so that they can maximize their profits (Alemanno, 2015). Some of the
ways that the organization has done to maximize the profits is by reducing the number of
employees within the organization. Reduction of the workers will minimize the operation cost,
and this will lead to an increase in the profits of the company.
Passing burden to consumers
The other way the company has done to maximize their profits is by passing the burden
of tax directly to the consumers. Priceline strives hard to ensure that their clients have the
opportunity of getting airline tickets and hotel stays at a discounted rate. However, due to the
taxation, the cost will only have a small difference as the one being charged without the
discounts. Product discounting is a way used by majority of companies in the market to attract
more customers for themselves. This means that, discounting is used as a competitive advantage
by different companies, Priceline group Inc. have been using this strategy for long, however, in
current times the company finds it hard for it to use this strategy due to the taxation from the
government. This have long term and short term effect to both the company and consumers
(Fullerton, and Muehlegger, 2019). The money lost due to have taxation from the company
affects the company in a negative way, for instance, due to the taxation the company finds it

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difficult to market themselves since with the slight difference it is hard to persuade potential
consumers about the advantage of buying their services. Sometimes back, the company used
revenue and profit generated by the company to market itself locally and globally. However, due
to high taxation from Australian government the company find it hard to secure money for
advertising itself in the market.
Running into debt
Due to the reduction of the profits from the organization, the company faces the problem
of running into debt. The primary role of every business is to make profit, however, due to heavy
taxation imposed by Australian government to Priceline group Inc. the company is find it hard to
run daily company cost. In the long run, the company profit is reducing day by day. With
minimal profits, the cash flow within the organization is expected to reduce, and this is bad for
any business. To reduce the problem the organization do borrow to ensure they have a cash flow.
With low profits, the organization does borrow more for them to operate in the business. The
borrowing is expected to rise when the right measure is not followed.
The organization faces the risk of being not able to adapt to rapid technological changes.
Adapting to the latest technology requires the company to incur a substantial cost for the
company to have the latest devices as well as the software. Adapting to the latest technology is
likely to affect the operation of the organization as the legislation minimizes their profits.
Priceline has different treaties that have had an impact on their services. Some of their
agreements are with the suppliers. Priceline has a different supplier, and this has made them have
access to cheaper rates. The rates are essential both for the organization and its consumers. The
cheaper rate is essential in attracting customers to have access to their services. The rates are also

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essential in maintaining the existing clients provided they are satisfied with the services
provided.
The organization also has an agreement with the data providers, and they allow them to
collect data from their customers. The data collected includes IP address and information about
the browser. The information collected is vital as it helps the company have a customized ad and
content directed to their probable consumes. The move is essential as it helps the company send
important messages to their consumers.
Company and an agreement
The company has an agreement with the vehicle they normally hire, and they are meant
to provide services with their clients. The car provides the service at a discounted rate, and this
has helped in helping the company transport their clients from one destination to the other. Once
one book for transportation via vehicle, the information will be given to the driver, and this will
ensure the client can be picked and transported to their preferred destination. The agreement is
vital for the business since the customer will get the opportunity to enjoy the ride faster and at a
lower price, this will enable them to do what they want within the shortest time possible.
Priceline cruises have an agreement with World Travel Holding, and this ensures that
they provide the platform to book the cruise. Priceline charges a smaller rate compared to the
price that is being charged by the World Travel Holding, and this helps them to market and bring
in more customers who will enjoy the services offered by the group.
Priceline also has an agreement with LATAM Airlines, and it facilitates travel to South
America. The airline is directed towards the travel of the continent, and the interested clients are
encouraged to travel with them at discounted rates. The partnership has ensured that Priceline

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brings in customers and they do get their share after the business is over. Since Priceline is a
well-known company, they market the airline and attract customers to take a ride with them. The
agreement enables both organizations to gain from the trade.
Treaties with other companies
Since Priceline is a popular company, they have agreements with most of the hotels
which agree to give them accommodation at a lower price. Since Priceline helps the hotels by
bringing on more clients, the hotel agrees with their offer and agree to charge lower prices for the
clients who the organization books for them the ticket (Van Harten, and Malysheuski, 2016).
With the agreement, both parties enjoy from the trade since the hotels will get the opportunity to
host more clients and Priceline will enjoy the profit from the arguments that they initially had.
Agreement
The organization also has an agreement with KAYAK, and this ensures that the clients
can easily book for the tickets and hotel stay at a lower price. KAYAK is a search service
enabling the customers to search and compare the prices of airline tickets, rental cars, and
accommodation with ease. With the feature, clients get the opportunity to know which available
package suits their need before deciding to purchase it (Hearson, 2016). The agreement is vital
for the consumers since they get the opportunity to compare the different rates available before
choosing the one that suits them.
Serving customers better
In order to secure more capital assets and be able to serve its customers better, Priceline
group Inc. is sourcing capital from outside the company. For instance, the company is partnering
with other companies such as Agoda in the market (Chow, 2015). Priceline also has a business

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partnership with Agoda. The reason for partnering is to share the cost and reduce the loss
incurred by the firm. As the saying say two is better than one, sharing cost between the two
would reduce the loss incurred in the long run. Agoda is accommodation and reservation service
based in the Asia-Pacific region (GOH, BHATTACHARYA, and CHAN, 2019). The company
helps its clients book the stay at the hotel within a specific period, and their customers can be
assured of getting the opportunity. With Agoda, the clients can book the stay with ease and be
able to enjoy their stay at the hotels. The agreement is mutual since both Priceline and Agoda
enjoy from it (Nzudjom, et al, 2016).
Rental cars
Rentalcars.com is one of the leading rental cars reservation in the world. With it is easy to
book the travel to a various location within a metropolitan. With rentalcars.com Priceline will
link them with their clients at a cheaper rate, and this will ensure they enjoy their ride within the
region preferred by the clients. Both companies get to enjoy the partnership since they are all
gain from the deal (Czerny, Shi, and Zhang, 2016). Marketing is vital for the organisation, and
this helps in bringing in more clients who will bring in more revenue for the companies.
Priceline also cooperates with OpenTable, an organization that prides itself for providing
restaurant reservation and information for their customers. They also provide restaurant
reservation management to other restaurants. The collaboration helps in providing their clients
with services available in the restaurant, and this brings satisfaction to their customers.
Conclusion
Paying of taxes is mandatory to every company, firm, organization or an individual operating or
existing in a certain country. The taxes paid is used by the involved government to provide basic

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services such as education, infrastructure, and security among other basic services. This means
that every company is mandated to paying the taxes to government so that it can enjoy the said
services in the long run.

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References
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Land by Foreign Investors: Federal and State Legislative Restrictions, Limitations, and
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GOH, K.T., BHATTACHARYA, L. and CHAN, C.W., 2019. Agoda: Perpetual disruption and
post-acquisition challenges.

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Hearson, M., 2016. Measuring tax treaty negotiation outcomes: the Actionaid tax treaties
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