External Business Environment: Analyzing UK Economy and Marriott

This report provides a comprehensive analysis of the UK's external business environment and its impact on Marriott International. It examines the structure and operation of the UK economy, including taxation, population, and key sectors like tourism. The report discusses current government economic policies, focusing on fiscal and monetary policies and their influence on Marriott's operations. It analyzes the distribution of income, wealth, and employment in relation to Marriott's service provision, highlighting the importance of understanding customer demographics and wealth distribution. Furthermore, the report explores demographic trends such as age and income levels and their effects on employment patterns within the hospitality sector. Finally, it delves into the social structure of Marriott's employees, emphasizing the importance of diversity and skills in achieving customer satisfaction and maintaining a competitive edge, while also discussing employment practices like full-time and part-time positions.

EXTERNAL BUSINESS ENVIRONMENT
TASK 1

1.1 STRUCTURE AND OPERATION
OF UK ECONOMY
In order to determine the structure and operation of UK
economy, it is involved varied factors such as taxation,
population, security, regulation and size of the economy.
However, UK is considered as the 6th largest economy on the
basis of GDP and market exchange rate. Moreover, the
agricultural sector of UK also provides 0.7% contribution in
the nation's GDP.
Thus, it can be evaluated that combination of all such factors
helps country to become one of the fastest growing
economies. In regard to this, taxation policy of UK also
affects the operations of nation. Hence, it can be assessed
that taxation policy of the nation is transparent and simple.

Continued...
For instance, it is crucial for the government of country to
formulate effective taxation policy so that it leads to provide
significant support to the nation's modern business practices
(Giudice, Kuenzel and Springbett, 2011). Also, UK taxation
system helps effectively to suit with the globalized trading
world.
Moreover, the government of UK is also trying to make
constant efforts in regard to perform changes in its existing
taxation system. However, it is done in regard to make sure
that the nation's taxation policy is compatible with other
external factors.

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Furthermore, UK is considered as the 22nd largest
country by population. As per the statistics of 2015,
it can be evaluated that population of UK is around
64,454,853. However, it has been noticed that
majority of the UK population is in the older age
group. Hence, it may create problem for the service
industry as they find difficulty in carrying out the
operations.
Thus, in regard to meet the requirement, businesses are
required to hire skilled candidates from other nations
and this in turn can enhance the cost of firm (Kaplan
and Norton, 2001).

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Moreover, in regard to maintain the security of country,
UK undertakes British Intelligence Authority. It helps
in serving the country and handles the illegal
activities such as counter terrorism etc. Thus, through
such way, this agency helps in securing and
safeguarding the citizens of country.
However, such system is effective as it works for the
benefit of both individual and businesses in the UK.
In addition to this, there are several other industries
that also help in contributing in the UK economy.

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It involves travel and tourism sector that plays a crucial
role in improving the economy of country. According
to the statistics, it can be assessed that in the year
2011, travel and tourism contribution to the total
GDP was 101 billion Euro that is 6.7% of total GDP.
Thus, all these factors help in improving the
economic condition of UK (Meade, 2012).

1.2 CURRENT GOVERNMENT
ECONOMIC POLICY
Economic policy can be stated as the act that is
undertaken by the government in order to make
effective decision in the economy of country. It
involves different areas such as setting the level of
taxation, making decision regarding government
budget, deciding the interest rate etc. Following are
the two different types of economic policies that
affect the operations of Marriott International hotel.
It involves both fiscal and monetary policy which are as
follows-

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Fiscal policy- It can be assessed that government adjusts its
spending level and tax rate in order to monitor and influence
the nation's economy. However, fiscal policy affects the
macro-economic condition of country. With the help of such
policy, government helps in controlling inflation and
unemployment rate. For instance, fiscal policy of UK
possesses significant impacts upon the activities of Marriott
hotel (Carroll and Buchholtz, 2014).
If, UK undergoes through recession condition then demand of
hotel services will be decreased. It is such type of condition
that directly impacts upon the purchasing power of
customers and they avoid consuming such type of luxurious
products and services.

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Monetary policy- Such policy is formulated by the
monetary authority of country and thus, it determines
the size and rate of money supply through using
interest rate. However, main aim of monetary policy
is to stabilize the price level.
UK monetary policy is controlled by performing
different types of actions such as modification in the
interest rate, changing the bank amount and selling
government bonds etc. For instance, activities of
Marriott hotel are influenced through the demand and
supply of money (Claessens and et. al., 2010).

1.3 DISCUSSING THE INCOME, WEALTH AND
EMPLOYMENT DISTRIBUTION IN RELATION TO THE
PROVISION OF SERVICES
Distribution of services within hotel largely depends upon the
individual's income and wealth. Generation of income is the
amount received by the customers on constant basis in return
of doing certain work. Marriott hotel is a five star luxurious
service provider and thus it delivers best services at high
prices. However, the services which firm provides cannot be
rendered by all the types of hotel as well as cannot be
afforded by all the type of customers.
Hence, people with high standard of living or who belongs to
upper class is considered as the buyer of such services. Thus,
business mainly focuses upon the high income class people
to provide them desired services and attain results (Joardar,
Kostova and Wu, 2014).

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Further, manager of Marriott is required to direct its
efforts in order to improve the service quality and
attain satisfaction. As per the statistics collected from
Great Britain, it can be assessed that the individual
who resides in upper income class consists of 44% pf
total wealth.
While, 55% of people who belongs to the lower income
class possess no wealth. Thus, such type of factors
leads to cause necessary impact upon the provision of
services which are rendered by hotel. It is essential
for business to set the prices of services as per the
customer base.

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Additionally, wealth of firm is also affected through the
different types of services which is being provided by
the manager of Marriott Hotel. However, wealth is
the value or worth of all the assets that is being
owned by individual.
For instance, the wealth of firm highly depends upon
the services which is being given by business to its
respective customers. For example, management of
Marriott hotel does not provide high quality services
to its consumers in return of obtaining huge money
from them (Jones, Hillier and Comfort, 2007).