SME & Entrepreneurial Theory: Marketing Practices in UK Hotels

This report provides an overview of Small and Medium Enterprises (SMEs) and entrepreneurial theory, detailing the characteristics, importance, advantages, and disadvantages of SMEs. It focuses on the hospitality industry in the UK, specifically analyzing marketing practices at Haytor Hotel and Marstan Hotel. The report explores word-of-mouth marketing and telemarketing strategies, including their advantages and disadvantages, and suggests effective strategies for implementation. It concludes that marketing is crucial for SMEs to promote their products and services, while acknowledging the funding challenges SMEs often face.

SME and
entrepreneurial
theory

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Table of Content
• Introduction
• Explanation of SME
• Characteristics of SME
• Importance of SME
• Advantage of SME
• Disadvantage of SME
• Best practice methods and techniques of entrepreneurial
marketing in chosen organisations
• Word of mouth to mouth marketing

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Introduction
• Small and medium sized
enterprises are those
businesses which operate
with few number of
employees cover less
geographical area
(Cusmano, 2018).
• They are the one who
provide local products to
their local customers and
they contribute an economy
to grow well.

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Explanation of SME
• In context of UK, SME are those organisations which are
having employees below than 250 and they have less than
£25 million turnover. It also includes having gross asset
less than £12.5 million (What is a small business or SME,
2020).
• According to a research, it is recorded that there are almost
5.94 SMEs business across the UK at the start of 2020.
• SME are those organisations which maintain
employees, revenues and asset below a certain limit.
Every country is having their own definition of SME
and has fixed a certain limit for them which are
different from another country (Gebauer, 2018).

Limited investment- The capital which is required by the entrepreneurs to start their
SME is less due to their small scale operations (Liñán, Paul and Fayolle, 2020).
Labour intensive- SME’s did not require high quality of machinery and tools, they
only require good quality of management and skilled labours to work for the company.
Less number of employees- Due to their small scale of operations, SME requires less
number of employees. Hence, they high fewer employees as compared to large
companies.
Management- Most of the SMEs is managed by a single or few group of individuals.
In context of family business, the head of the family take all managerial decisions for
the business.
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Characteristics of SME

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Importance of SME
• Employment generation- SME help
an economy to grow by generating
various kinds of jobs and opportunities
for those individuals who seek
employment for their survival.
• Promote local products- SME focus
to offer local products to their
customers which is essential to
maintain the culture of an economy.

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Advantages of SME
• Better control over business- Due to
its size the owner can operate their
main operations and have full control
over the business (Saura, 2021). All
decisions are taken by the owner.
• Better communication- SME are
having better communication due to
less number of employees and there are
less chances of miscommunication due
to small communication chain.

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Disadvantages of SME
• Less use of technology- Manpower is
use more in SME as compared to
technology due to less investment.
Machinery and tools require high
investment which a SME is unable to
manage. Hence, they choose manpower
efforts more than machinery.

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Overview of chosen
organisation

The Hospitality industry is chosen for the report which is one of the
fastest growing industries in UK. Two hotels are chosen whose
description are mentioned below-
Haytor Hotel, Torquay- This is one of the oldest hotels in UK which
is founded in the year 1835 and it is headquartered in Devon,
England, UK.
The Marstan Hotel, Torquay- It is also SME hotel with employees
less than 25 and earns revenue of nearly 5 million per year (Marstan
Hotel, 2022). They are having well developed rooms for their
travellers and have swimming pools inside the building as well as
outside.

It is essential for these hotels to maintain their
marketing activities appropriately and achieve their aim
and objectives with the help of few effective practices
of marketing.
In context of the above two hotels, they are focused to
promote their business through social media marketing
by uploading the pictures and features of their
destinations to gain the attention of travellers.
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Best practice methods and techniques of
entrepreneurial marketing in chosen
organisations

Word of mouth to mouth marketing
This is the marketing procedure where a company is required to
satisfy their customers appropriately and further work is done by
customers themselves by communicating the benefits of products and
services to their friends, family members and the close ones whom
they know and communicate (Li and et. al., 2018).
This will help to gain the attention of more customers and it is the
tendency of a customers that whatever they heard in market, they will
get attracted to that specific services and product and try them at once
to gain same experience which they heard by their known one.