Business and Management Report: The Pig Hotels Analysis

This report provides an executive summary and detailed analysis of The Pig Hotels, a UK-based hospitality and tourism business. It examines the influence of external forces, including political, economic, social, technological, legal, and environmental factors (PESTLE analysis), and the competitive landscape using Porter's Five Forces. The report also explores The Pig Hotels' corporate social responsibility (CSR) initiatives and their importance. The analysis highlights how The Pig Hotels adapts its strategies to navigate market challenges, maintain customer loyalty, and achieve financial success, including its expansion plans and responses to economic fluctuations and social trends. The report concludes by emphasizing the importance of strategic planning and CSR in the contemporary business environment, particularly for companies in the hospitality sector. This report is a valuable resource for students studying business and management.

Contemporary Development
In Business and management

EXECUTIVE SUMMARY
With changes in political laws, economical situations, development of technology, social aspects
and more, it becomes necessary for organisations to modify business policies on regular manner.
In context with hotel industries, instability in external factors creates a large impact on customer
base. Therefore, corporations like The Pig Hotels have to develop their strategies to overcome
from such situations. Along with this, they have to make investment in CSR activities so that
public support can be gained for enhancing tourism and business management.

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Influence of external forces on working of The Pig Hotels and importance of each factor on
the working of organisation....................................................................................................1
TASK 2 ...........................................................................................................................................5
Corporate Social responsibilities of The Pig Hotels...............................................................5
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12
.......................................................................................................................................................13

INTRODUCTION
Today with rise in competition, it becomes necessary for companies to create changes in
business activities. In this regard, the interface of internal and external environments has a great
importance in development of organisation. It assists companies to make adjustment in business
as per demand of customers. For contemporary development, it is essential for organisations to
concern on those factors which influence their function (Wirtz, Schilke and Ullrich, 2010). The
present assignment is divided into two main tasks where first part will make a discussion on
internal and external environment. While second task will highlight how demographic factors
like demand of ethics and CSR activities influence company's policies. For this purpose, The Pig
Hotels of UK is chosen which deals in hospitality and tourism sector. This corporation includes a
collection of some small lifestyle hotels and restaurants. These hotels are divided into two main
groups, that are- Home Grown Hotels and Lime Wood Group. Currently, it has near about five
hotels in UK named by The Pigs, The Pig in the Forest, The Pig in the Wall, The Pig near Bath
and The Pig on the Beach.
TASK 1
Influence of external forces on working of The Pig Hotels and importance of each factor on the
working of organisation
In hospitality exceeding expectation of guests is one of the major trends in service
industries (Welch and et. al., 2011). Due to this trend, hospitality and tourism industry is
considered as the fastest growing sectors in UK. In context with The Pig Hotels, it is a part of
Homegrown Hotels Group which believes that providing effective services to customer, aid this
company to gain loyalty and retention of guests for longer period. With this regards, main
strategy of this hotel is based on a single line tag- Thank You from The Pig'. This organisation
mainly targets to leisure and business travellers. There are various factors present in business
environment that influence policies and strategies of this hotel. It includes political laws,
economical fluctuations, socio-economic factors and more. It is the responsibilities of
management of this organisation to identify such aspects. By conducting PESTLE and Porter 5
force analysis, managers of this company develop effective strategies and understand importance
of the same for running business successfully.
1

Mission of The Pig Hotels: To increase the satisfaction level of tourists by creating
unsurpassed vacations and leisure experiences.
Vision of The Pig Hotels: To become one of the premium providers of leisure as well as
vacation experience in UK.
Financial Report: Among newest hotel, turnover of Pig Brand is increasing at rapid rate
i.e. near about 20% or £17.1m, with pre-tax profit reducing from £969,813 in 2015 to £40,004
last year. This hotel also repeated its success from 2015 with the highest occupancy at 96%. This
has increased revenue from 2.2% to £4.7m. Along with this, on daily basis, this hotel serve
approximate 166 customers (Demand for the Pig remains high as turnover increases 20%,
2018).
PESTLE Analysis:
Political factors: The Pig Hotels mainly operate its business in UK only. But now it is
going to launch some more new hotels and restaurants in other countries also. Since every
nations have distinct political rules and conditions which influence operational activities of
business. Therefore, before opening any new restaurant, managers of this hotel needs to
determine impact of such factors on its policies (Sturdy, 2011). It includes interference of
government, political stability, in hospitality industry, intellectual property and more. Due to
political instability like wars, crises, terrorism, conflicts etc. create a large impact on tourism
industry. As such conditions develop threats in mind of tourists, due to which they avoid to come
for travelling. Thus, it would impact directly on profitability and decision-making procedure of
hotel industries.
Importance: By identifying these factors, managers of The Pig Hotels can determine
which government policies are in favour of business. This would help in forming effective
policies and prepare plans for launching hotels in other countries more adequately. Since the
level of tourism in UK is increasing at rapid manner, therefore, improving security measures is
considered as the major challenges in front of owners of The Pig Hotels. Government and hotel
industries are now concerning more on social security and terrorism because it directly impacts
on growth and development. Thus, such types of issues affect tourism and profitability of this
hotel also.
Economic factors: It is considered as one of the main factors which impact on entire
functions of business. In context with hospitality industries, any economical crises will directly
2

affect their business. It includes high taxation, inflation rate and interest rate, foreign exchange
currencies and economic cycle. This would aid affect behaviour of customers also because
deflation and low level of income create adverse impact on their purchasing power. Cost factors
such as inflations, hike price, foreign exchange rate affect the number of tour packages to
destinations and outbound tourism also. Therefore, it impacts on decision making of hotels
because with hike in price, they have to create changes in price setting and other processes as
well.
Importance: Having knowledge of economical situation of marketplace aid managers of
The Pig Hotels to make plans to overcome from such conditions. They can make attractive
proposals to gain interest of investors towards its business expansion. They can focus on
overseas business and funding their business through FDI also. When a company is possessed of
another company in other country, it is referred to as foreign direct investment (FDI). Foreign
companies elaborate with everyday operations carried out in any other country. This means along
with money; skills, knowledge and technology are also brought in country. Organizations that
make FDI are referred to as multinational enterprises (MNEs) or multinational corporations
(MNCs). Multinationals' expertise and funding are required for expansion of international sales.
FDI plays an important role for growing market and developing countries. Private investment is
needed to increase jobs and career opportunities in field of infrastructure, water and energy. In
this regard, Pig hotel also needs to concern on pricing strategies so that it can attract mind of
tourists more. By offering services on reasonable and low rates, aid this organisation to make its
customer base strong because middle families can easily afford its services and can stay for
longer period.
Social factors: It creates a huge impact on business of hotel industries because such
organisations are needed to offer products as per preference of tourists. Due to this factor, The
Pig Hotels are needed to identify the demand of targeted customers and offer services
accordingly. Poor infrastructure and sanitation, criminal activities with tourists, heavy traffic, etc.
are some social factors which impact on tourism negatively. Therefore, decrease in travellers,
directly affect profitability of hotels including The Pig Hotel.
Importance: Determination of social factors like unemployment rate give chance to The
Pig Hotels to get high skilled workforce on low salaries. By giving high job opportunity, this
organisation can get high support of public in enhancing its brand image. Social factor majorly
3

impacts on employment policies of The Pig Hotels. It has to offer job to fresher candidates on
adequate amount of salary because this organisation cannot afford to provide employment to
high skilled.
(Source: PESTLE Analysis, 2018)
Technological factors: This factor give various benefits and opportunities to
organisations deal in hospitality and tourism sector to promote business. With every new feature
in technology, it assists The Pig Hotels to replace existing techniques with new one. Thus, this
would directly impact on budgetary control policies of this hotel. But ignoring this demand also
reduce chance of sustainability and get competitive advantage as well.
Importance: In order to promote business and enhance sales volume, The Pig Hotels need
to introduce best technology within business (Schaltegger, Lüdeke-Freund and Hansen, 2012). It
helps utilising limited resources in optimum manner and improve position of business in
marketplace as well. This would also give opportunity to provide high accommodations like Wi-
Fi services, 3-D gaming zone and more to tourists. Along with this, high level of technological
advancement, aid hotel industries including The Pig to provide facilities such as online booking,
e-payment and more. It also improves services given by such industries to tourists which would
give positive impact on business.
4
Illustration 1: PESTLE Analysis

Legal factors: This factor includes laws and legislations established by UK government
regarding operation of hotel industry. It includes Health and Safety Act 1974, Equality Law
2010, Development of Tourism Act 1969 etc. As per this law, it is essential for The Pig Hotels
and other organisations to provide safe and healthy environment to tourists. They must ensure
that whatever services offered to guests like Food, Spa, Swimming facilities and more, should be
of best quality. This hotel must concern on privacy of tourists and implement safety tools within
hotels. It includes fire extinguisher, Emergency Exits, Emergency Helplines in every room etc.
Importance: Benefits related to consideration of this law by The Pig Hotels helps in
offering best services to tourists. Be considering the laws and legislations while making policies,
this hotel can prevent its business from illegal activities and provide good accommodations to its
guests. It can also maintain long term relation with its employees and other stakeholders by
running business as per legal laws. As per legal factor, this hotel needs to concern more on safety
and security towards tourists and workers. It has to bring high security cameras, equipments and
safety tools within workplace. This would help in monitoring and tracking criminal activities
through which safe environment can be given to guest as well as staff members too.
Environmental factors: It consist laws and norms related to environmental adherence
which impact on production of organisations. This would assist The Pig Hotels to make
participation in CSR activities for reducing air and water pollution, environmental pollution
waste management etc. For example: Use those products which pose no risk to environment
when they are used by tourists. Conserve natural resources by reducing energy consumption.
Importance: By making investment in CSR activities, this hotel can gain high attention
of its customers (Piekkari, Plakoyiannaki and Welch, 2010). It can also bring attention of people
towards business operations, which would help in improving sales performance and generating
high revenues for successful growth. Due to rapid increase in tourism and hospitality industry,
level of pollution is increasing in today’s world, therefore, it directly impacts on ecosystem also.
Furthermore, for prevention of environment from any kind of harm and promote the safety,
Government of UK concerns more on Green Tourism. It assists The Pig Hotels to dump wastage
properly.
Porter's Five Force Model:
Threat of new entrants: Any new entry in hotel will lead to bring innovation in services.
But this would pressurise existing corporations by assisting them to offer services on low prices
5

and giving new value propositions to guests. Therefore, The Pig Hotels has to build effective
strategies to face such challenges. For example: Create useful hotel loyalty cards which provide
various benefits to customers like heavy discounts for repeating visits. This would help in
getting attention of tourists towards its services.
Bargaining power of suppliers: In lodging or hospitality industries, almost all companies
are affected by negotiating power of suppliers. As they provide raw materials and resources to
organisations for production. Therefore, any bargaining for extracting higher prices will reduce
profitability of business. To tackle this issue, The Pig Hotels has built efficient supply chain with
various suppliers. Along with this, its managers have also made effective relationship with them
so that they can provide raw materials and other resources on less rates.
Bargaining power of buyers: It refers to customers who are considered as main key driver
of success and growth of business (Pahl-Wostl and et. al., 2011). They always want to acquire
high accommodation from hotels on easy and minimum price rates. It has examined that if a
company has more powerful customer then there will be high bargaining power of them as well.
Thus, in this regard, by developing a large base of customers, The Pig Hotels can gain advantage
to streamline its sales performance and production process. Along with this, it is also helpful in
reducing bargaining power of buyers as well.
Threat of substitutes: It also considered as main issue in front of corporations as any new
product which develop to meet needs of customers on low price, affect sales performance of
them. In context with hotel industries, if any rival companies offer unique value proposition then
it will impact on existing services of others. To overcome from this issue, The Pig Hotels need to
become service oriented instead of product oriented. By understand actual requirement and
preference of customers, this hotel can high satisfaction of them.
Industry rivalry: There is an intense competition in hotel industries which will drive low
price strategies and decrease the entire profitability of business as well. The Pig Hotels operate
business in hospitality sector therefore, it has faced an intense competition. There are many
competitors present in same market like Marriott, Holiday Inn Manchestor, Apex City of Bath
Hotel etc. All these companies have adopted effective strategies in order to attract mind of
tourists. Therefore, it affects profitability of The Pig Hotel and assists to develop unique
strategies as well. In this regard, by developing sustainability and product differentiation, it can
gain high competitive advantage.
6

(Source: Porter's Five Force Model, 2018)
TASK 2
Corporate Social responsibilities of The Pig Hotels and its influence on its policies and decision
making
Corporate social responsibility is considered as the business approach which helps
organisation in building up its own sustainability by contributing in the development of
environment. These activities are especially done for purpose of contributing their shareable
amount to the social causes in order to improve social condition of country. With the changing
business scenario, CSR activities have become trend for the business organisation in order to
show up their responsibility towards the society (Myers, 2013). CSR activities are often adopted
by organisation in order to improve their brand name at market place. In relation to the PIG
hotel, it can adopt certain CSR activities in order to enhance its goodwill at market place for the
purpose of increasing its sustainability. For this, its managers have conducted a deep study on
CSR activity and its influence over economy. Ethics and CSR activities are necessary for
building good image of this hotel at marketplace. This would help in attracting tourists towards
services of The Pig Hotel.
As per the analysis, it has been identified that this organisation is dealing in the
hospitality industry which requires a good brand image in order to influence trust of customers
7
Illustration 2: Porter's Five Force Model

towards them. It has been evaluated that this hotel owns large number of customers, buyers,
clients, suppliers etc. which are directly dealing with company as well as its management team.
Hence, it can be said that CSR activities are influencing decisions making process of the
company so that they can achieve their targeted goals and objective of the company. These
decision influences are described as below:
Customers influence: Customer are the one buys or uses products and services which are
offered by the company. It is the main objective of every organisation to increase its number of
satisfied customers who can purchase their products at regular basis (McDonnell and et. al.,
2010). For this business organisation uses various tools and techniques to impress the customers.
In context to the Pig Hotel, adoption of CSR activities helps the company in influencing interest
of customers towards them. This also builds soft brand image of the company in front of
customers, that this company is not only focusing on making their profit but they also contribute
for the welfare of the society. Management team of the company can also take some take
effective decision like sharing their amount of profit on every sale or booking of hotel room with
the charitable trust. This directly influences interest of customer and they will prefer the same
hotel in future. In addition to this, it also contributes in satisfying customers and gives them a
reason to remain loyal with the same hotel while using hospitality services in future. As a result,
this activity contributes in achieving targeted goals and objective of the company with the
maximisation of profitability ratio.
Employee's influence: Employees refers to the individuals who work for organisation in
the exchange of money. They play essential role in the growth of organisation by achieving its
targeted goals and objective of the company in the given time frame (Ma and Yu, 2010). In
relation to the Pig Hotel, its employees are considered as the valuable asset of the company as
they are the only one who provides best class services to the customers and make them feel
relaxed during their every visit. It can be said that involvement of CSR activities not only
influences customers but it also attracts employees as they are the part of this organisation who is
working for social work. For example: The Pig Hotel can adopt an CSR activity for its customers
that is implementation of 3Rs within the hotel that is reduce, reuse and recycle. Management
team of the Hotel can engage its employees in this activity within their daily based activities as it
will make them feel good that they are also contributing in welfare of the society within their job
responsibility. As a result, it will also improve their performance level.
8