University of Wales Lampeter MEP TBE

Title

Impact of Business Environment on Britannia International hotel in last 5 years.

Executive Summary

This is the assignment focusing on the changes in the business environment of the
Britannia International in the last 5 years. It has been discussed on the internal and
external business environment and the impact of the factors of the internal and
external business environment on the business policy of the company. It has shown
the applications of the model of the factors in the lifetime of the hospitality industry
for the growth and development.

Introduction

This assignment is focusing on the business environment of the Britannia

International hotel industry. The scope of the business environment is discussed in
terms of the internal and external environmental factors. The Britannia International is
one of the prominent five star hotel industry in London situated at the glance place of
seashore in the Canary Wharf. There is a wide scope of the hospitality industry
business is available in the city of London as it is an international place of the visitors,
where many people used to come from the different parts of the world for
travel,education,living. It is situated on the water’s edge of London docklands with
the ideal, glance views of the skyline. The external environment of the hotel industry
is surrounded with the O2 Arena, Greenwich and west end of London are with in the
nearest place.(Hudson,2009) The hotel is situated outside the congestion zone with
having 442 air-conditioned rooms with an ensuite as a standard room on the upper
floors giving the spectacular view of Thames river and the London skyline, Rooms
are having the luxury spacious environment from inside with the having some
balconies creating the glance attraction of the workplace. Excellent breakfast, dinner
and lunch are the recognising factors of the Hotel industry along with snacks,
pizzeria and Italian dishes are the glance facilities creating the effective supplier
power of the business. (Marich,2010) There is an availability of the Conservatory bar
with the glance views on the waterside offering a creative and ambient atmosphere in
the surrounding area which is used to give the thrill of enjoyment and exposure in the
city of London. (Husen.2010)

They are offering health and Leisure club facilities with the swimming pool, sauna
and the gym facility. There is a conference hall meetings and Banqueting facilities
where up to 1500 people can be accommodated. (Benzo,2010)

Literature Review

The Business Environment is the grouping of the factors which are having the great
influence on the business, in the case of the hospitality industry there is a major scope
of the internal and external business environment as London is an international city in

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the globe, there is a wide scope of the international visitors from the different parts of
the world who used to come here for the travel, tourism which has expanded the scope
of the hospitalisation in this city, Internal environmental factors are creating the scope
of the business with the impact on the day to day management policies in the regular
operations, they used to create the strength and stability of the existing business to
administer the operations (Pecock,2008) External Business environment has been
created with the PESTEL analysis in which strategic focus is used to be given on the
political,economical,social,technological,environmental and legal factors which are
having the direct impact on the business, political environment consists of the
Govt.policies and regulations along with the Workforce Management which are
inherent to the business applications, they are having the close relations to the
business measuring the strategic impact – Economic environment of the business has
been created with the financial policies and customs in which preference is given to
economic development rate of the country – inflation rate- rate of the capital
investment- interest rates of the banks which are inherent to the business policy of the
hotel industry, there are social factors which are having the close inherent impact on
the selling capacity of the business, supplier power of the business can be created on
the basis of the social customs,trends,fashions which are running in the current market
(Federer,2009)

In the Technology Developments it has impacted on the improving of the

performance level of the business with the increasing of the supplier power to offer an
optimum level of services, Technology improvements are attracting the new guests
and visitors to come in the hotel and increase the business with the innovations and
inventions, Environmental impact is corresponding to the influence of the natural
factors which are affecting on the regular operations of the business environment such
as floods-riots-earthquakes which can be causing to the serious losses in the business,
Legal environment is denoting the impact of the legal rules and regulations on the
business policy, it is manly focusing on the consumer protection act, Health and
safety (Kshatriya,2005) Internal and External business environment of the hotel
industry is having the strategic significance in the day to day operations, internal
environmental factors such as Suppliers,Customers,Media,Government, employees
who are having a direct impact on the management policy of the business, it is giving
the precise guideline about the organisational behaviour and the decided aims and
objectives of the business which are to be implemented (Lewis,2008)

The strategic applications of the business are planned on the basis of the
environmental scanning, how the factors in the business environment are co-relating
to the business strategy so as to decide the applications in the business in terms of the
achieving of the goals and objectives of the business, the right policy of the business
can be constructed based on the internal and external business environment, when the
business environment is challenging or it is creating the obstacles for executing the
strategic norms then effective remedial action is required to be taken in order to solve
those hurdles and creating the ideal environment of the business for the achieving of
the Critical Success Factors (Harold,2007) The success of the every organisation is
depending on the probability of the internal and external business environment which
is used to create the semantic nature in the relation to the business (Boon,2006)

Discussion

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The business environment is having a strategic focus on the success of the

organisation. Every organisation is applying the policies and strategies which are
suitable and ideal for the achieving of the business objectives. All the factors in the
internal and external environment of the business have a very close impact on the
business environment. Business policies are depending on the decisions taken by the
owners of the business along with that the level of the production in economy is
depending on the relations maintained with the suppliers, if the policies of the
suppliers are liberal timely raw materials can be available to maintain the production
process. In the same way, market competition is having a strategic significance in the
business, when the number of competitors in the external business environment are
more it automatically leads to increase in the performance of the organisation as every
business is trying to be superior over the other with the upgrading of the level of
performance in the day to day operations.

In the external business environment political factors are influencing the business
with the different impacts on the business policies with the changing strategies of the
Government. As per the changes in the Govt. policies about the import – export
regulations, foreign exchange rates, workforce management there is an impact on the
business strategies and operations. Economic factors are directly impacting on the
business operations and trends of the business. When the bank interest rates on loans
are increasing it is leading to increase in the rates of the capital investment. Higher
rate of interest is leading to low capital investments and vice a versa. As well as the
rate of inflation in the business is affecting the economic position of the people living
in the society. When the rate of inflation is higher it is leading to the higher income of
the people in the society which is used to increase the buying power of the people
living in the society with the increase in the consumption level of the business.
Socialistic trends, fashions and customs of the people are changing which has impact
on the sales turnover of the business.

Technological Environment is used to play an idealistic role in every business

organisation. As per the adoption of innovation and invention in the business the
supplier power of the business can be increased which is resulting in to increasing the
revenue of the business. Environmental factors are the significant as they are
influencing on the buying decisions of the consumers at the point of time such as
floods, riots, earthquakes. Legal factors are closely related to the every business
activity, consumer protection act is giving the right strategies for the achieving of the
optimum level of satisfaction of the customers. Health and safety regulations along
with the employment laws are having the close relationships with the organisation and
management.

Critical Analysis

The Business Environment has a very close impact on the growth and development of
the hospitality industry. In the international city of London there is a broad scope of
the hospitalisation and the hospitality sector with the popularity as an ancient Greek
roman city in the world. Internal factors are relating to the business as per the
following model application –

Internal Business Environment

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a) Shareholders - These are the prime environmental factor of the Britannia

international. Routine business is whole and sole depending on the decisions taken by
the shareholders in the day to day life of the business. Shareholders are used to decide
the strategic investments of the business with the area of the operational directions. In
the Britannia international shareholders had decided to develop the new branches of
the hotel industry in London, they had decided to use the differentian strategy in the
business in which they decided to commence the travelling and tourism operations as
the supportive activity to the core area of activity of the business with the
reinvestment of the profits in order to increase the revenue recognition from the
business.

b) Employees – Employees are the main sources of the business on whose efforts the
operational performance of the hotel is dependent. The Britannia international is
having a good staff potentials in the business in all the areas of activity of the Bar,
Kitchen and operational services. Employees are the wealth of the organisation who
used to increase the supplier power of the business.

c) Suppliers – Supplier relationship strategy in the hospitality industry is an ideal and

strategic. There is a consistent supply of the raw food is used to be maintained on the
weekly basis with that there are no issues in the organisation in which guests are used
to be dissatisfied. Hotel industry is always used to maintain ideal supplier relations to
achieve an optimum satisfaction of the customers which has rapidly increase the
revenue generation of the business in the last five years. It has been observed that
there is on and average an appreciation of 110% of income level of the hospitality
industry in the last 5 years.

d) Competitors – Market Competition is used to play a strategic role in every business

in order to increase the level of the performance. When there is a close market
competition, it is always favourable for the business as the increase in the market
competition leads to increase in the performance level of the business. The Britannia
international is having a close competition with the Hotel Hilton Metropolitan, Hotel
Syon Park, Hotel Marriot and other five star hotels. As London is an international city
in the world there is a wide scope of the hospitality industries in this city creating a
tuff competition in the external business environment which has an impact on the
level of the performance of the hospitality business.

e) Media – This is the medium of the advertisement and publicity through which
product and service information is used to be spread to all the directions of the city
and in the different locations through the way of the using of the different techniques
of the communication. Britannia is used to have applications of the public relations
and direct marketing techniques of the marketing communications in order to attract,
identify, develop and retain the customers in the day to day operations. The media
publicity has helped the expansion of the business through the right direction of the
strategic Customer Relationship Management in the day to day operations. There is an
increase of the average 30 % of the customer relationships every year in the last five
years, therefore media is playing a strategic role in the publicity of the hospitality.
(Tasus,2010)

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f) Customers – Every business is depending on the customers, customers are the

primary factors which are leading to increase in the revenue generation of the
business. Guests , visitors are the customers in the hospitality industry making an
increase of the potentials of the business. The Britannia international is one of the
leading business organisations having a large customer base in the city of London.
Marketing strategies are helping to increase in the number of customers which has
ultimately leading to increase in the customer relationships of the business to increase
the sales turnover. It has been observed that there is a trend of the regular survey and
analysis of the market in order to know about the needs and demands of the people in
the view to increase the visitors in the hotel. In the last 5 years hotel industry is used
to have an appreciation of 150 % of increase in the sales turnover. (Tasus,2010)

External Business Environment

a) Political – These are the factors which are resulted in due course of the changing
government policies and customs affecting on the business policy. It is relating to the
Govt.Subsidy, import –export regulations and workforce management in the business.
The Britannia international is receiving feasible government support for the running
of their day to day business activity. As 85 % vegetable supply in the country is used
to receive from the outside countries in London, the hotel industry is used to import
the raw food from the from Mumbai (India) They have a good relations with the
suppliers outside the country to avail the time to time supply. (Tasus,2010)

b) Economical – As the country is recently coming out of the impact of the economic
credit crunch which has faced in the year of 2008 in the world. In this period there is a
serious slowdown in the economic policy regulations of the country, production in the
economy has came down leading to create the serious economic problem of
unemployment. Due to which income level of the people has been seriously affected
which has affected the buying power of the people in the society, due to which there
is a degradation of the business in this period, however, there is used to be an up
gradation of the economic level as the country is in the recovery stage from the year
of 2009. In the recovery stage there is scope of the employment has been available in
the market and even if full employment stage has not been come there is the stage of
the recovery of the economic position of the country which has resulted in to
beginning of the growth and development of the hospitality business. Reduction in the
interest rates on loan has increased the rate of the capital investment which facilitates
the new investment in the business.

c) Social – The changes in trends and fashions of the people with the economic
recovery in the country has leaded to increase in the turnover of the business. The
identity of the human being in the society has been increased with the socialistic
changes in the habits, likes, preferences of the people in the current market. In such a
way in the relation to the growth of the hospitality industry social environment is
exclusively depending on the Economic policy of the country.

d) Technological – The development of the technology is the meritous point for the
Hospitality industry. Innovations and inventions are brought in the business in the last
five years which has increased the supplier power of the hotel industry. New
techniques of Heating of the food, washing of plates, lighting , sprinkling of water,
cooking machines, tea-coffee maker are brought in the day to day hotelling operations

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so as to increase the supplier power of the business. With the optimisation of the
facilities in the services offered by the hotel industry there is an increase of the
revenue of the day to day operations. Technological updating are helpful for the
brining of the renovations in the day to day business activity in the Britannia
International.

e) Environmental - Changes in the external business environment are leading to the

natural calamities of the business such as riots,floods,earthquakes, icefall. In the last
year there was icefall in London which has deteriorated the business of the hotel
industry as it has leaded to the degradation of the business as an environmental impact
with the losses of the food items.

f) Legal – Legal environment of the hotel industry has been based on the applications
of the consumer protection act, health and safety regulations and employment laws.
There is the fair services are given to the visitors at the reasonable rates of the food
and beverage with the maintaining of the reasonable pricing strategy. Health and
safety is given to the employees with the maintaining of the employee insurance
schemes which are used to give them protection in the term of employment.
Workplace has been created with the safety and security of the atmosphere without
any disturbances of health hazardous factors such as Gas, fuel etc. Employment laws
and regulations have been followed with the maintaining of the regulations of the
minimum wage payments @5.83 p.h.

Conclusion

The business environment of the Britannia International has been created with the
impact of the internal and external factors. Business strategy has been created with the
focus on the increasing of the supplier power of the business. Innovations and
inventions are useful in the business to bring modernisation and to bring increase in
the revenue generation of the business. Economic disaster which has bad impact on
the environment of the country is now at the stage of the recovery which will help to
increase the turnover of the business in the coming period. In such a situation the
hotel industry is having the great scope of the expansion and development. Their
differentiation strategy is suitable in the changing business environment in order to
take entry in the travelling and tourism operations which will be the effective
supportive level of activity for the developing of the core area of activity of the
business.

References

1] Hudson,L.(2009), Britannia International, Hospitality Magazine (Dec.2009),

no.2,article2,issue1,p3.

2] Marich,N.(2010), Britannia International,Hospitality Magazine

(Jan.2010),no.3article1,issue2,p2.

3] Husen,D.(2010),Supplier Power of Britannia, Hospitality Magazine (Feb.2010),

no.1,issue1,article 2,p4.

4] Benzo,L.(2010), Hospitality Industry,1st edition,Lara ,London.

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5] Peacock,K.(2008), TBE,2nd edition,Wales,Manchester.

6] Federer,G.(2009), External Business Environment, Hospitality, 2nd edition,vol.2
no.4,p33.

7] Kshatriya,K.(2005), TBE,1st edition,Ajay,Mumbai.

8] Lewis,D.(2008), Business Environement, Hospitality Sectoral,2nd edition,vol.2

no.4,p42.

9] Harold,S.(2007), Strategic Management, 2nd edition,Lisa,Bermingham.

10] Boon,M.(2006), TBE,2nd edition,Martin,London.

11] Tasus, O.(2010), Business Environment in Hospitality, Hospitalisation Magazine

(Feb.2010),no.2,article3,issue1,p16-19.

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