THE STRENGTH, WEAKNESSES, OPPORTUNITIES AND THREATS (SWOT) IN MARRIOTT HOTEL CHAINS AND RESORTS
Marriott is considered the most leading hotel and leisure companies in the U.S. that has various business brands in the global market. At the corporate level, Marriott operates in most countries in the world. The company which has been known with its strong brands like Marriott Hotels and Resorts, JW Marriott Hotels and Resorts, The Ritz-Carlton, Bulgari Hotels & Resorts , Grand Residences by Marriott, Courtyard by Marriott and Towne Place Suites by Marriott; is the most admired and recognized in the hotels, resorts and casinos industry worldwide. In fact, it has been receiving various prestigious awards across the countries. Marriott has reached its peak of success because of its own eight positive traits which still continuously imbibed by the company itself and the people who work in the different branches of the company. These eight outstanding characteristics of Marriott include innovation, excellent people management, proper use of corporate assets; the entire workforce has a strong social responsibility, effective management strategic plans, there are stable investments; as well as remarkable profits and return of investments; and the most important trait is the company always caters for best quality products and services for diversified clienteles in the world. In addition to that, Marriott has its own product range and pricing strategies that enables to serve its wide range of customers; as well as it enables to address the individual demands of the international market. Aside from that, the company has a strong technological foundation that serves as its one of the strongest competitive advantage for Marriott over the other competitors; as it owns the world’s seven largest consumer retail website, the Marriott.com. The website provides the company with gross property-level income of US, 200 million in 2008 fiscal year. Additionally, the company also offers booking facilities and services to its customers through mobile services. During its fiscal year, Marriott recorded more than US million revenues through its mobile booking engine. And, because of the company’s exceptional technological facilities and abilities, it tremendously reduced its promotional expenditures for the fiscal year.
(http://www.reuters.com/article/2008/07/10/us-marriott-idUSWNAB025420080710)
However, after all the success and achievements of Marriott, still there are challenges that the company has to hurdle. In April 2009, the Marriott’s credit rating had lowered by Standard and Poor Ratings Service. The downgrade in Marriott’s credit rating makes it difficult and expensive for the company to access again in the credit market. Eventually, there would be an increase of capital cost of Marriott’s; if its credit rating continues to fall down. More important to know is the threats that the company would be going to experience with its operating margin that dropped to 6.1 percent from 9.1 percent in 2008; this only indicates that Marriott has not been able to manage well its cost structure. Subsequently, declining operating margins have great impact on the profit making process of the business. And, even until these days, Marriott reportedly declined its net income to US7 in the second quarter of June this year; from US7 million in the previous year. Moreover, Chief Executive J. W. Marriott stated that the other Marriott chain of hotels outside the United States are continually benefiting from the strong global demand of the customers. But still, the domestic market in the US territories is as not as active as the other branches in other countries. Equally important is the major concern of the hotel industry towards US airlines, which are cutting routes as their way of fuel cost cutting for their own survival. There are many hotel executives in the United States who are hoping for the reduction of fuel prices so that business travel and hotel industry can boom again in the domestic market.
(http://www.reuters.com/article/2008/07/10/us-marriott-idUSWNAB025420080710)
On the lighter side, Marriot has been doing its very best to apply initiatives to cover up its areas of improvements for the past years. In this connection, the company decided to make changes or renovations on its existing chain of hotels. For instance, the Atlanta Marquis has able to complete its renovation of hotels recently with a total expenditure of US$ 138 million; as well as the Renaissance Hotels and Resorts division has completed also its three-year renovation contract which costs up to US,000 million. In the same manner, there are many business opportunities for Marriott to expand its business in China and Indian resorts. Based on the geographical research made, the travel and tourism condition in India and China is remarkably growing; it even doubles the growth rate of other competitors in the rest of the world. Therefore, Marriott can benefit largely from the business travel and tourism market in both countries.
(http://answers.yahoo.com/question/index?qid=20090719172405AA4Fsd2)
References:
(http://www.reuters.com/article/2008/07/10/us-marriott-idUSWNAB025420080710)
(http://answers.yahoo.com/question/index?qid=20090719172405AA4Fsd2)
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