The Macro Environment Analysis Economics Essay

The Macro environs Analysis economic science EssayThe macro environment is made up of 6 uncontrollable external factors. These factors influence an organizations decisions, commercial enterprise and financial st localisegies as well as its everywhere all in all surgical operation. These factors ar Economic, Demographic, tender Cultural, Natural, Technological, and Political.3.2 Demographic environmentThe demographic factor covers topics much(prenominal) as age, gender, date of birth, average family sizes and so on.Population GrowthThe United States has go through a substantial influx of people. Within the last 10 classs there has been an ontogeny of over 33 trillion people, making the U.S. the most heavily populated nation in the world. A solid exclusively constant population annex is expected for the next 50 years. We hobo expect an increase in the number of Ameri washbasin guests at the Marriot capital of The Netherlands. If the marketing strategy is tailored in order to inveigle more away from Hotels such as the Hilton. The situation in Europe is different than in the USA.The European Union has a totalpopulation of almost 500 millioninhabitants (27 states of theEuropean Union) whereas Europehas 732 million inhabitants.Within the next 40 years thepopulation is predicted to decreaseto approximately 630 million inhabitantsin 2050.This can be seen as a threat in the long run beca utilize the impact on the labor is that the volume of the market provide shrink as the total resident population impart shrink.i3.3Economic EnvironmentAmong the importance of people who make up markets is the importance of their purchasing power, level of employment, gross domestic mathematical product, and rate of inflation which is fit(p) by the economic environment. Both gross domestic product driveth judge increase on a low, but steady level. Due to the recession, it is likely that negative growth rates occur within the next basketball team years for b oth western economies. Recovery is predicted on a very low level for the year 2012.India in comparison has a quite low gross domestic product at the moment, but is predicted to catch up with big steps of over 100% per decade. With annually GDP growth rates of 6 to 10 per centum during the last decade India is one of the world fastest growing economies. The latest recession simply hit the country but recovery is predicted to take devote more rapidly, profoundly and on a far higher level than in western economies.InflationThe inflation is an important indicatorfor purchasing power in an economy.Symptoms of inflation atomic number 18 increasing prices andtherefore consumers decreasing purchasing power.iiCredit grateBy mid-2008 the financial crisis turned out as a result of the economic turn down, the sub-prime owe crisis and the collapse of the housing market.iiiThe collapse of the housing market led to a bank collapse resulting in a massive liquidity crisis. This became a plane tary problem the ongoing book of facts crunch. Stock markets crashed worldwide. The credit crunch is affecting business line as well as consumers.ivTo conclude, this is a threat for any friendship because consumers atomic number 18 losing their purchasing power in the EU, US, Japan and UK. Besides that, consumers be more careful with their property because they indirect request to save it in case that they will lose their job due to the economic crunch. save rateThe saving rate reveals insights of the spending patternsof one country inhabitants. This figure shows thepersonal saving rate of the USA, Canada, UK and Germany.Due to cultural differences the saving rate of Germanyand otherwise European countries is traditionally higher thanthose in Anglo Saxon influenced countries.The more interesting development is the increaseof the saving rate in all four countries later the year 2007. This is ca apply by the credit crunch and the followers(a) recession. During times of econ omic downturn people ladder to save money. They are becoming anxious about their jobs and the future. The increase of the saving rate is a strength threat because peoples spending priority lies on essential goods and services rather than on luxury items. The of import market would be for business guests and baby boomers who do not mind spending some senseless money in order to open the comforts they have become used to.Income level of the aspire marketsNations deepen greatly in level and distribution of income and industrial structure. Our analysis is focusing on industrial economies and their consumers. These economies are seen as rich markets for all sorts of goods and services.UnemploymentFrom 1993 up to 2009 the unemploymentrates for as well the EU, UK as for USare increasing and decreasingthrough the years. Increasingunemployment rates are for eachcompany a threat because when consumersloose their jobs their purchasing poweris decreasing.vThe unemployment rate will avera ge9.2 percent in 2009, 9.6 percent is 2010 in the USA.The forecasting average for 2011 is 8.9percent and for 2012 8.7 percent is forecast.The rising unemployment rate is a threat for the cordial reception industry in that consumers are more likely to save their money than spend it when unemployed. Even if they want our services they do not have the financial resources available to them.3.4 Social-Cultural EnvironmentCorporate social obligation (CSR) was developed as a type of self regulation. Typically integrated directly into the business theoretical account of the corporation. The premise is that the corporation that has integrated with CSR will conform to certain pre-determined norms of society when engaging in business. The norms would vary from legal, social, ethical, moral, environmental as well as an increase in concern over the various elements of the public. Elements such as, but not limited to the community as a whole, customers and employees. Although this moral busine ss concept appears to be sound CSR has come under constant criticism. Many claim the moral aspect of CSR is nothing more than a faade, allowing these companies to, in fact, exploits the situation at hand.The psychological effect of terrorism is also a factor we have to keep in mind. The frequency of spark offling is decreased by this occurring factor.3.5 Natural factorsMacro factors are those factors that the company cannot influence itself, but these factors can certainly have a great impact on how the company is will perform. The Marriott hotel in capital of The Netherlands lies in the center of the Netherlands with a sea climate. This means that all year round the stand will be mild with no extreme summer or winters. While these factors might not directly influence the performance of the hotel, others can. When looking at the volcanic eruption, which took place in the midst of April 2010, airlines cancelled all flights and passengers were stranded. While this at first presented a boom in military control due to stay-overs, the long run presented problems as many meeting were cancelled. This presented a downfall in revenue fortunately problems were solved after 2 weeks when the eruption ceased. The hotel can of note never in full predict certain circumstances but after this experience should be prepared for it.Besides weather factors that will put pressure on business, the trend is shifting towards producing eco-sustainable business. Producing and running your business in a nature friendly way.When looking at the hospitality industry we can give examples as not overly washing linen, using soap dispenser, recycled paper/pens, dividing trash, light sensors, special heating systems, laundry detergent.3.6 policy-makingDue to relatively recent events there has been a major force affecting the hospitality industry. Of grad due to the shrinking world phenomenon business travel has become more and more of a sine qua non but recreational travel has dropped s ubstantially. In hospitality, even before the attacks the picture didnt look good. According to metalworker Travel Research, U.S. hotel occupancy was 61.9% year-to-date through June 2001, a drop of 2.7% compared to the same period of 2000. RevPARs declined 0.4 % to $58.99. Preliminary figures indicate that occupancy rates and RevPARs were down 2%-4% in August of this year, compared to August of 2000 (Smith Travel Research). Another strong political force which will affect the Marriot is the increasing worldwide attitude towards smoking. Currently, the Netherlands has an approach of only specialised areas or small, private establishments are permitted to allow smoking in their premises. Smoking in public places or exact/bus stations is also prohibited. By offer a specialised and separate area (the Cigar Bar) there is a greatly increased likelihood of attracting a larger customer base. This is due to catering to a larger customer base demographic.3.7 TechnologyImproving productivity is the main goal of technology. Especially for entropy technology (IT). In studies there is proven that there is a relationship between IT investments and the productivity and performance of the business. Due all the new technology that has appeared over the years. Front office applications, restaurant and banquet solicitude systems, and guest-related interface applications. We assume that these rapid changes in technology will continue. vii3.8 evidenceThreatsUS vaulting horse exchange rate for Euro will drop by 5% in 2011.10% increase of ability prices in 2011.Smoking prohibition.Rapid change in technologyOpportunitySmall growth in European economy of 1% in 2011.Slow recovery of US economy and rise of GDP of 2% in 2011.Corporate market in Europe will show a growth of 2%-5%.10% increase of Chinese travelers in 2011.International tourism in the Netherlands will grow 5%.Rapid change in technologyMicro Environment4.1 Market structureMarriott hotel has a monopolistic emulation, w hich means that the company faces a large number of firms each having a small similitude of the market share and slightly differentiated products. The main demand for the Marriott hotel is leisure and business guests.CustomersSegmentation Amsterdam The Netherlands subscriber line transient 53% 36%Leisure individual 22% 37%Tour groups 8% 7% conclave 12% 15%Others (crew) 5% 5%Total 100% 100%Business Transient found on the following assumptions and information the Marriott can expect an increase of business transients compared to the prior years. The main points are as follows10% growth in 2010 in produced revenue of ASEAN (Thailand, Indonesia, Malaysia, Philippines, Singapore, Brunei, Burma (Myanmar), Cambodia, Laos and Vietnam), India, Turkey and Brazil.UKs GDP economy expects to rise 2.7% and economy is recovering slowly. (http//www.finfacts.ie/irishfinancenews/article_1019481.shtml)American economy expects a rise in GDP of 2% and economy is recovering slowly.European economy will grow in 2011 with 1%The in a higher place information shows that the economies in the major shares for the Marriott are increasing. Thus, companies will have to send their employees a sop up on business trips.One downside of this assumption is decrease of the US buck exchange rate of 5%. indeed peculiarly the American business guests will be more then price sensitive and expect to have more service included (e.g. internet). However as we are expecting that the British pound is increasing in 2011 we can assume that the British guests (20% of guests staying at the Marriott Amsterdam) will continue to travel.Individual TouristsBased on the following assumptions and information received the Marriott can expect an increase of Individual Tourists compared to the previous years. The main points are as followsEU citizen are expected to have a growth of 5%Expected growth of short breaks and weekend trips to cities.As the GDP in the USA and UK are expected to rise, it can be sham that it will have a positive correlation on the standard of living of citizens of that country. Only the US market will not increase tremendously as the exchange rate for the US dollar will decrease by 5 %. However the British Pound is expected to rise compared to the Euro.Conference ParticipantsBased on the assumption and information received the Marriott can expect an increase in crowd participants compared to the previous year. The main point is as followsThe same reasons as for business transients can be used to explain the increase of conference participants segment. Companies are expected to produce more goods and therefore will wait on and conduct again trade show, conferences, meetings etc.Tour Groups / Other RatesBased on the following assumption and information received the Marriott can expect a decrease in Tour groups and other rates compared to the previous year. The main reason is as followsAs we are expecting a rise in the business transient, leisure guest, conference pa rticipants the Marriott will not be able to sell as many rooms through the discounted channels. Therefore the rooms sold to Tour groups will be less.ContractBased on the following assumptions and information received the Marriott can expect an increase in shorten rates compared to the previous year The main reason is as followsIn year 2010 the produced revenue was far preceding(prenominal) the expected budget. As Marriott Corporate Office is urging the hotels to put a focus on they contract rates we can expect again an increase in this segment. However Marriott Corporate Office advises the Hotels not to discount the rates less than 25% of the average daily rate (otherwise the head office unavoidably to be contacted for approval).4.2 Distribution ChannelsBusiness TransientIndividual TouristsConference part.Tour GroupsOtherSocial media25%10%50%25%50%Central Reservation System34%32%40%20%GDS27%10%30%Travel Agent2%15%10%25%30%Hotel Website12%17%20%3rd party websites16%Social media is a very effective way of distributing, due to the snowball effect. Direct Sales by the hotel are of course also very important. The Central Reservation System of the Marriott is also used to distribute itself so are the Global Distribution System, Travel Agents (via GDS), the Hotel Website and Third Party Websites (Expedia etc)4.3 Internal financial decisionsInternal financial decisions lie in of financial decisions made within the Marriott chain or the Marriott hotel Amsterdam itself, or financial opportunities within the company. The weaknesses and strengths are also a part of this. Marriott International as a stakeholder has more general objectives and goals regarding ecology, human rights, stockholder equity.4.4 PublicTo know what the public or guests thinks of the Marriott hotel, they use feedback forms, customer reviews. The reach the public we make use of marketing and media campaigns.The presence of Social Media is getting more and more important and is already a self-made marketing tool. But only the bad feedback on an online platform like Facebook, Twitter, MySpace etc will have a big influence on customer perception.We assume that our public has a good overall externalise of the hotel. We do not exclude complains because you cant anticipate on everything.4.5 CompanyFB shall become more integrated in using international Marriott concepts for outlets. Two concepts will be uniformly implemented in Marriott hotels worldwide The Midtown Grill and The Cigar Bar, as these concepts are now regarded as a standard feature of our hotels by liege guests, especially US guests.4.6 CompetitorsAfter studying and analyzing the Amsterdam Marriotts budget for the first case assignment, in this chapter we will focus on the menstruum and future market situation and developments.No guests no business Therefore the Marriott hotel has to know its competitors by hard to be a step ahead and make use of its advantages to gain an even bigger share of guests and increase revenue as well as profitability.Competition can be differentiated into four main formsproduct form competitionproduct category competitiongeneral competitionbudget competition.In this assignment we will basically focus on product form competition as well as on general competition in monetary value of f b outlets.In case of the Marriott Hotel this means identifying and analyzing competitors, which offer and deliver the same kind of products and services. following(a) characteristics were used for the selection process of hotel competitorsshelterdiningbusiness facilitieshigh-quality interiorluxury ambianceThe current product competition consists of following hotelsThe GrandOkura HotelGrand Hotel AmstelThe Hilton AmsterdamEden American HotelSince the Leidseplein offers more than great hundred restaurants in close proximity, it is rather difficult to define and analyze competition. In the case of the Sorels Midtown Grill we chose competing restaurants offering similar cuisine and/or attracting the same customers.Following characteristics are involved for selecting direct restaurant competitors muddlecuisineattire/atmosphereopening timesThe competition consists of following restaurants at the LeidsepleinCaf AmericainLos ArgentinosBarbecue Castell demanding Rock Caf AmsterdamGauchos Amsterdam4.7 Possible future hotel competitorsDue to a recovering world-economy and forecasted trends about travel behavior/ travel patternsof countries such as the USA, European, BRIC ASEAN countries, overnight stays of business and leisure guests will increase in Amsterdam. As there is still sensitivity regarding price-value ratio, especially in the corporate business, following hotels are possible new competitors in 2011.HotelClassificationRoom numbersLocationDateEden Amsterdam Manor Hotel4****100Linneausstraat 891093 EK AmsterdamMarch 2011Conservatorium Hotel Amsterdam5*****130Keizersgracht 62-641015 CS Amsterdam,spring 2011ArtotelAmsterdam4****105Close to Centraal Stationspring 2011City Inn4****540Oosterdoksstraat 41011 DJ Amsterdamspring 20114.8 Market dynamicsInteraction between hotel and fb regarding demand and depict is efficient. But the changes and the dynamics of the market is beyond control of the hotel. Because the hotel business is not in an free (open) market.4.9 ConclusionThreatsSocial MediaPossible future hotel competitorsMidtown Grill as a steak house to specificOpportunitiesCommission will be reduced from 3% to 1%.Growth of fixed contracts.Growth of conference and banqueting segmentCigar bar.OccupancySocial MediaGrowth of business segmentMarketing Management 12e page 79