Case Study on Premier Inn Assignment Sample

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1. Introduction

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The Premier Inn is owned by Whitebread and the hotel is the “United Kingdom’s biggest hotel brand” the hotel is successfully managed to increase its global presence in a country like Germany. The Premier Inn offers some of the best deals when it comes to using their services since their offerings are primarily at reasonable as well as affordable prices. About 820 hotels are being operated and offered to the customer or consumer in the United Kingdom and around 80,000 hotel rooms are in various impressive locations (Whitbread PLC, 2022). The Premier Inn appointed around 30,000 human resources within 1,200 Premier Inn Hotels and Restaurants throughout the United Kingdom and it is serving almost 6 million customers or consumers throughout every month.

The essay aims to study the case of Premier Inn Hotel in the time of Pandemic where hospitality and tourism have been immensely affected by the arrival of COVID-19 as many countries restricted travelling and the lockdown was also imposed. To study this case study, the SWOT analysis of Premier Inn in which strengths, weaknesses, threats as well as opportunities explaining how Premier Inn has managed to combat the COVID-19 and where they were vulnerable in fighting Covid-19. PESTEL Analysis will also take place.

2. Organisational Structure of Premier Inn Hotel

The organizational structure of Premier Inn Hotel is the tall organizational structure which is very complex because the tall organizational structure takes a lot of time to answer any market changes as the person managing the hotel have the very least level of control. The Tall Organizational Structure refers to the hierarchy of management that is fragmented into various layers such as executives (top), normal employees (bottom). Tall Organizational Structure is also known as “Top-Down Structure” (Ram, Satish, and Ravindran, 2010). As Premier Inn is the United Kingdom’s biggest hotel, the chain of command can get complicated and it becomes very hard for the information to move swiftly or effectively or efficiently in the whole organization. Premier Inn has a large number of managers in the hierarchy and each manager is responsible for his/her department. Numerous managers’ presence in the organization is a very positive thing because the productivity will be at maximum since the majority of the managers are well equipped with expertise as well as experience and thus less confusion will contribute to more work productivity.

The downside of having a Tall Organizational Structure is the "Time Consuming Process", the amount of time it takes to report executives regarding various major decisions discussed at the different hierarchy levels of Premier Inn and due to the presence of many hierarchy levels in Premier Inn, each level has specific rules attached to it which results in time taking process. Premier Inn has a huge support network and the employees can contact the manager of his/her level regarding any assist or confusion. Premier Inn also has an “Effective Intranet” system that could be simply accessed and utilized by every member of the workforce. The Tall Structure is very helpful for a large corporation like Premier Inn in which the people sitting at the top of the hierarchy can concentrate on making major business decisions for the hotel operations. With technological advancement, the tall organizational structure is going to become more accessible and simpler.

3. Business Environment Analysis

The business Environment involves all the factors that are crucial for the business to flourish (Cherunilam, 2021). The factors such as SWOT Analysis, demographic trends, international trends, political factors, government & regulations, economic factors, technological factors, and as discussed, these business factors are crucial if any business wants to survive or grow or expand in this competitive business environment.

3.1 SWOT Analysis

3.1.1 Strength

The Premier Inn is the largest hotel in the United Kingdom with about 820 hotels are being operated and offered to the customer or consumer in the United Kingdom and around 80,000 hotel rooms in various impressive locations (Whitbread PLC, 2022). This becomes one of the strengths in fighting the COVID-19 as this shows that the company has a huge financial resource that they can use to provide a safe, clean and hygienic environment to the customer as well as employees.

3.1.2 Weakness

The pandemic has affected all the companies of all sizes and scales as major way as possible and Premier Inn is no exception, the pandemic has resulted in “£1bn loss amid pandemic lockdowns” and the international presence of Premier Inn is not strong as compared to other biggest international hotel chains and due to that, it could be difficult for Premier Inn to generate revenues in the time of Covid-19 (Kollewe, 2021).

3.1.3 Opportunity

In this time of the pandemic, Premier Inn could invest its resources in building the value of the brand by offering quality customer or consumer experiences. Premier Inn can appoint a hygiene brand ambassador and this person will be accountable for all the “Safe Management Measures” in the hotel and training and development for all the employees regarding serving the customer while taking care of the safety protocols (Premier Inn, 2021). There is a huge scope in using digital media for informing about their services to the customer or consumer in the time of the pandemic.

3.1.4 Threat

The pandemic is a big threat which is inevitable since the pandemic; many hotels are already suffering from huge losses in the market. Premier Inn is no exception; it is also going through phases of losses and the company has to cut down jobs to sustain the business (Neate, 2020). There is no denying that workforce is the most valuable asset for any business and cutting down a job is the biggest threat that the company has to go through.

3.2 PESTEL Analysis

3.2.1 Political Factors

The favourable political factors of Premier Inn Hotel can be the changes in the tax system that can result in the development of Premier Inn hotels. For instance; the UK introduced the VAT reduction to 5% during the pandemic for hospitality businesses (BBC, 2021). The unfavourable factors can be the government putting restrictions such as the national lockdown on 23 March 2020 which affected the hospitality and tourism industry massively since this industry is heavily dependent on travelling and tourism.

3.2.2 Economical Factors

There is no denying the fact that Premier Inn is the biggest hotel in the United Kingdom and numerous investors investing in these hotels are massive. The Premier Inn is one of the hotel industries which generated around 398 million British pounds in the year 2020-21. Any economic fluctuations could directly affect the hotel destination choices. For instance: Due to the pandemic, inflation for the hospitality industry is approximated to reach 7–8% in the coming months (Partridge, 2022).

3.2.3 Societal Factors

Premier Inn is one of the companies which always value its workforce and the community by generating new employment opportunities by the construction of new hotels and introducing the new initiative named “CleanProtect” for fulfilling the promise of providing the clean, safe, hygiene environment service to the customers or consumers as well as employees (Premier Inn., 2021). The consumer always prefers the best reasonable options in the business environment and the presence of competition can be a bad thing as well as a good thing.

3.2.4 Technological Factors

The technological factors are the most drastic changes that take place rapidly and swiftly in the business environment. Technological advancements have contributed to a lot of valuable and meaningful changes in the world. Premier Inn also adopted various new ways of creatively interacting with the customer or consumer with the help of digital media and the internet. However, the technological factors can be cursed if the organizations cannot keep with the disruptive technological environment (Giri, and Pawar, 2018).

3.2.5 Environmental Factors

The environmental factors can be the various climate change events that can affect the business operations of Premier Inn. Premier Inn is committed to cutting the carbon emissions by 50% and the company approximated to cut the carbon emission by 88% by 2050 (Premier Inn, 2021b). Premier Inn investing in installing new solar panels for utilizing the solar energy to power the hotel and the use of other renewable energy as well. The downside is that this renewable energy is in the phase of becoming a norm that is not yet happened due to that there is a huge requirement of financial resources for the implementation.

3.2.6 Legal Factors

No business can survive or sustain itself without following the legal legislations of the United Kingdom as they are the legal framework for the business to conduct business fairly. There are various legal factors like consumption law, employment law, and health & safety law etc. Consumer Law is designed to protect the customer from being exploited by various malpractices of businesses. Employment law is designed to promote equality for the workforce (Zahn, 2018). The unfavourable factors can be the hotel construction in an area where there is a huge crime rate and therefore that can affect the premier Inn revenue generation.

4. Conclusion

This essay attempted to study and understand the Premier Inn Hotel in which it managed to discuss the organizational structure of Premier Inn, SWOT Analysis, and PESTEL Analysis of Premier Inn. As discussed above, Premier Inn has a tall organizational structure in which there is a huge hierarchy regarding chains of command. The advantages of a tall organizational structure are having managers for every department which makes the process effective and efficient. The business environment is the crucial component for Premier Inn. A huge financial resource is one of the strengths of Premier Inn that can be used to provide a safe, clean and hygienic environment to the customer as well as the employment. The weakness is that the international presence is not strong.
The threat is cutting down on the workforce due to pandemics. The opportunity can be the appointment of a brand hygiene brand ambassador. The political factors can be daunting as well as favourable for Premier Inn, UK introduced the VAT reduction to 5% during the pandemic for the hospitality businesses. The unfavourable factors can be the government putting restrictions such as the national lockdown on 23 March 2020 which affected the hospitality and tourism industry massively since this industry is heavily dependent on travelling and tourism. The environmental factors can be the various climate change events that can affect the business operations of Premier Inn. Premier Inn is committed to cutting the carbon emissions by 50% and the company approximated to cut the carbon emission by 88% by 2050. Technological advancements have contributed to a lot of valuable and meaningful changes in the world. No business can survive or sustain itself without following the legal legislations of the United Kingdom as they are the legal framework for the business to conduct business fairly.