THE GENERAL ENVIRONMENT
Restrictions on visitors: The announcement from white house about the ban on 8 countries visitors has affected international tourism rate. The total market share of long-haul fell to 11.9 percent last year. According to figures released by national travel and tourism office international visitors in 2017 has fell by 3.8% to 54.9 million. Due to decrease in international tourist rate it can have a big impact on luxury hotels.
Canadian Hotels pilot project: According to Hotel association of Canada, accommodation industry is facing labour shortage and if shortage of labour is not addressed then accommodation industry can face labour shortfall of 10,000 by 2035. Hotel association of Canada and tourism HR Canada together applauded federal government for launching Hotel pilot project to connect newcomers to Canada with job in hotel industry. This project will serve for both hotels and immigrants as for hotels to overcome their labour shortage and help newcomers not to face unemployment.
Drone technology: Photography has a great impact on customers which can help them decide to choose their desired accommodation or travel destination. Giving customer bird-eye view of hotel can attract the customers as they will be showing them a view point they could not possibly see themselves. Tourist are looking for an experience other than accommodation so providing them drone footage, hotel will lead them to booking process.
The internet of thing: It is an era of smart technologies and tech savvy people, so getting up to date with technology is necessary for any business now a days. For providing great service to customers hotels can introduce IoT to connect customers with their hotel rooms through internet.
trend increasing of international travel:
THE INDUSTRY ENVIRONMENT – PORTERS FIVE FORCES
Threat of new entrants – low
Limited to small scale: Everyday new hotels are coming to emergence in a great pace, but for four season potential threat from new entrants is limited to very low scale. For giving competition to luxurious hotel targeting upper class like four season one should over come some barriers like great economic power and political support.
Two kind of competitors for four seasons: Although the entrants are not much but exsiting competitor’s capabilities are very strong. Two kind of competitors are low-end hotels and hotels which provide high quality services. Even though low-end hotels have divergent target market, but low-end market is growing super fast.
Threat of substitutes – High
For four season hotel there are many substitutes available to customers with similar services, similar price and quality. Substitute products of this industry can harm the industry by placing ceiling on price.
Bargaining power of suppliers – moderate to high
Hotels like four seasons can not compromise with their quality so they have limited selected suppliers who have bargaining power within their hands, it could be because of other substitutes with same requirements and same quality of products. Four seasons have few suppliers because the prices of imported goods are high, due to location of this company it has high labor cost and construction cost.
Bargaining power of buyers – high
Bargaining power is high because the services or products they are providing are not undifferentiated and there are many substitutes available with similar services and with same cost. If we talk about switching cost, then it is also very low, so customers can easily switch to other substitutes.
Rivalry – high
Having lots of competitors with same services of similar price and quality make degree of competitor rivalry high. Loyalty among customers become low unless companies don’t provide a differentiated product to make them stand out.
Industry attractiveness – moderate to high
By looking at poster five forces it can be concluded that the overall attractiveness of the company is moderate to high. With high power of buyer, moderate to high power of suppliers and high substitute company still manage to be the leader in international hotel industry. It has built strong brand awareness among customers.