Tranquil rest motor lodge change essay

This current operation of Peaceful Rest Motor Lodge is losing money and the occupancy is under the industry normal despite the low cost. Tristan Knaus must make a decision between producing minor modifications in our operation or joining a motel string such as Days Inn and Holiday Inn.

Critical Concerns

Advertisement and Sales Campaign

The supervision does not make use of enough time or funds to market or release sales promotions, resulting in low occupancy prices. This retains the cost low for Knaus and the buyers but this individual relies on his customers to obtain the motel as they go for the resort area.

There are no signs that indicate the place of the conventional hotel except for both signs in front of his lodge. According to the U. S. Sba (n. m. ), signs are an economical and effective form of advertisements that works daily of the yr. Without a sign, potential customers in the motel is going to pass by without knowing about the business’ existence.

Customer-Centric Traditions

The current culture of the conventional hotel is not really customer-centric, causing few on the net reviews and low guests rates. In respect to Anderson, there are increasingly more00 customers that utilize online reviews before you make a purchase. Furthermore, he discovered that there was a positive romance between the cumulative impact of user reviews and the overall lodge performance (2012). Gustavo (2013) suggests that online review sites such as TripAdvisor can be a “strategic tool inside the relationship together with the consumer making sure the project a privileged and useful means of interaction and information management.  Although consumers generally leave positive reviews pertaining to Peaceful Relax Motor Hotel, there are too little. This may prevent potential customers via booking an area.

Lack of Recreational Facilities

The motel is not packed with recreational features such as a pool area in order to slice unnecessary expenses and avoid immediate competition with full-service resort motels, causing low guests rates. Knaus found that 78% of visitors believed recreational features were crucial in their selection of accommodation. Even though it is harmful for maintain a pool 365 days a year, general director Greg Bryan stated that 60 to 70 percent with their potential customersask if there is a pool (McMullen-Coyne, 2005).

Marketplace and the Physical Environment

The physical environment of the lodge does not attract the target marketplace to are available in, resulting in low occupancy prices. Knaus known that many persons drive inside the parking lot nevertheless do not go inside to register and book an area. According to Bitner (1992), “the physical environment is a differentiator in signaling the intended market segment, positioning the corporation, and selling distinctiveness via competitors (p. 67).

Lack of E-Commerce Site

The lodge does not have an e-commerce internet site where clients can find information and book rooms online, resulting in loss of sales in a competitive environment. According to Phelan, Christodoulidou, Countryman, and Kistner (2011), e-commerce sites are useful for resorts because it increases the booking and sales process, provides the experience of the service, and provides customers the ease of self-service and available information whenever.

Evaluation of Alternatives

Knaus has some alternatives to increase the occupancy price and earnings: make small operation alterations, join Times Inn, or perhaps join the vacation Inn.

Produce Minor Procedure Changes

Knaus could make minor operation changes such as starting a low cost yet visible sales promotion, bettering customer service, preserving and designing the appearance of the motel to attract target clients, and creating an ecommerce site.

Advantages. Making slight operation alterations will allow Peaceful Rest Motor Lodge to remain independent while attempting to maximize occupancy costs and revenue. Knaus would not have to pay a franchise payment and he could use the revenue to purchase the lodge. Moreover, an independent motel might have more flexibility to promote their uniqueness because there are no operation rules to follow (O’Neill & Carlback, 2011). Knaus will also have the choice of joining an advertising consortium including Small Luxury Hotels which provides a booking system for impartial hotels and provides consumers a sense ofreputation reputation (Gustavo, 2013).

Disadvantages. Outstanding independent will make it difficult to compete with the increasing competition in the area because the motel does not have a well-known brand name however. More guests are transferring by 3rd party motels pertaining to brand name hotels because brands have constant quality and the reputations are known”a business must constantly invest in improvements to keep persons coming (Lee, 1997). Turning the lodge into a known name brand could take more time and cash compared to signing up for a operation. Remaining self-employed is also a riskier purchase due to the higher variance in occupancy prices and revenue (O’Neill & Carlback, 2011).

Join a Franchise

Knaus could join a conventional hotel chain to stay competitive and attract customers in the area. His choices are Days and nights Inn or perhaps Holiday Resort. Advantages. Joining a franchise would give Knaus access to a central reservation system, national name reputation, nationwide toll free reservation lines which generates 40% of bookings in affiliated motels, and a website. Also, O’Neill and Carlback (2011) located that branded hotels within their study had significantly larger occupancy rates than self-employed hotels in most economic situations and significantly higher net operating incomes during economic recessions. This could be because of economies of scale within a chain as well as the customer dedication programs t more consistent occupancy costs throughout the financial cycles. Underlying (n. d. ) described that business owners may also have access to promoting support, business methods, and territory safety to improve their particular chances of achievement.

Days Resort Advantages. Signing up for Days Resort would not need any significant capital expense. They are also a great economy resort brand; Relaxing Rest Electric motor Lodge and Days Resort both target customers trying to find simple inexpensive motels. Times Inn has proven revenue promotions and membership applications that encourage clients to return. There are no disadvantages other than those who apply to both Days Resort and Getaway Inn.

Vacation Inn Positive aspects. Joining Holiday break Inn can increase the room rate to $75 each day due to the essential upgraded facilities. The addition of a pool could satisfy the customers who indicate that pastime facilities areimportant in their selection of accommodation. Vacation Inn also offers television and print marketing and regular membership programs that provide customers to come back.

Disadvantages. Knaus would have to pay 8% of gross area revenues towards the chain which covers the costs of reservation companies and countrywide promotion. You can also get periodic examinations and he could drop the operation if the establishments are not managed. Root (n. d. ) stated that becoming a business would be much less flexible intended for the owner of course, if the franchise company experience a scandal, the business could lose revenue as well.

Vacation Inn Down sides. Knaus will need new capital investment among $300, 500 and 500 usd, 000 as well as the upgrades do not guarantee bigger profit margins.

Support of Advice

It is recommended that Knaus join the Days Inn lodge chain to protect the conventional hotel from competition, attract more customers, and increase occupancy rates and revenue. First, the quest of Days Inn carefully matches the objective of Peaceful Rest Motor unit Lodge”to give comfortable areas at a fantastic value. Using a similar quest, Knaus can easily build on his idea of an ideal motel by using a franchise that provides brand recognition. Getting started with Days Resort would likewise allow the lodge to have the most powerful probable monetary performance”there is no major capital investment necessary. On the other hand, getting started with Holiday Resort would require a large investment while simply making operation changes might require money and time to improve the specific situation.

For the price of 8% of gross area revenues paid to Days and nights Inn, Knaus would acquire sales promotion, an ecommerce site, and customer service methods that could result in numerous positive reviews; these are every critical concerns of Tranquil Rest Electric motor Lodge. Acquiring the Days Resort name brand and making some improvements on the appearance in the hotel could also entice customers to come in and book an area. In the future, Knauss would have the option of adding recreational establishments such as a pool area if he finds that it would be effective. Finally, the periods Inn operation is in tranquility with the internal and external environment faced by the Calm Rest Motor unit Lodge.

Vacationers and monetary buyers can certainly still book regular rooms for their site for a reduced price and Knaus already provides managementexperience in a large firm. Despite the lack of extra facilities, becoming a Days and nights Inn will increase the occupancy rate through sales promotion, an online presence, and a identifiable brand name. The franchise could do well inside the high visitors location off the highway and possess a competitive advantage within the more expensive full-service resort motels by aimed towards the developing millennial population on a budget. Although recessions and uncontrollable external events might lead to a decrease in travel, customers can easily trust the Days Inn business to be inexpensive, comfortable, and consistent in different economic routine.

References

Anderson, C. (2012). The impact of social media about lodging functionality. Cornell Food Reports, 12(15). Bitner, M. J. (1992). Servicescapes: The effect of physical surroundings upon customers and employees. Journal of Marketing, 56(2), 57-71. Mr. gustavo stanley, N. (2013). Marketing managing trends in tourism and hospitality industry: Facing the 21st century environment. International Diary of Marketing Studies, 5(3), 13-25. Lee, At the. (1997). Travellers are completing independent motels lodging organizations while familiar logos drive more moreattract business. Retrieved February 20, 2015, via http://articles.baltimoresun.com/1997-08-18/news/1997230033_1_motel-association-independent-motels-lodging-industry McMullen-Coyne, S. (2005). Keeping swimming pools properly taken care of is 365 days a year task. Motel & Lodge Management, 220(5), 56-58. O’Neill, J. T., & Carlback, M. (2011). Do brands matter? A comparison of top quality and self-employed hotels’ efficiency during a full economic cycle. International Log of Food Management, 30, 515-521. Phelan, K., Christodoulidou, N., Countryman, C., & Kistner, L. (2011). To book or not to book: The part of motel web site heuristics. The Journal of Solutions Marketing, 25(2), 134-148. Basic, G., III. (n. g. ). Exactly what are the pros & cons of franchising? Gathered February twenty four, 2015, via http://smallbusiness.chron.com/pros-cons-franchising-181.html Roth, H. (2014). Travel and hospitality tendencies for 2015. Forbes. Retrieved February 20, 2015, via http://www.forbes.com/sites/ey/2014/12/31/travel-and-hospitality-trends-for-2015/ U. S. Small Business Administration. (n. g. ). For what reason do I need an indicator for my business?. Recovered February 22, 2015, from

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