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SWOT Analysis Case Study

By Betty Dunn,2014-05-16 16:55
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www.alacartetraining.com. ARTICLE. SWOT Analysis Case Study. Read through the case study. Write down all the strengths and weaknesses, opportunities and

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    ARTICLE

    SWOT Analysis Case Study

Read through the case study. Write down all the strengths and weaknesses,

    opportunities and threats you can think of in relation to the Sweet Dreams Motel.

    The Sweet Dreams Motel Far North Queensland

The Sweet Dreams Motel is a 40-unit, no-frills operation in the less scenic part of a

    major Queensland resort town. The owner, Mr Smith, firmly believes that there is a

    need for his style of low-cost family accommodation amid the luxury and beauty of

    the area. His rooms are large, family-style rooms (there is no television, for

    example). Although there is plenty of room for future expansion, the grounds are

    fairly bare with a bit of landscaping, but mostly grass.

Mr Smith can serve breakfast to the rooms and provides tea-making facilities. There

    are now a lot of good restaurants and take-aways in the area. Mr. Smith’s prices are

    less than half of what similar motels charge and only a fraction of what the big five-

    star properties are charging. And, really, he isn’t all that far away from the beach,

    shops and other attractions.

The problem is occupancy. He has some regulars who come every holiday period

    (and have been doing so for the four years he has owned the property). Overall,

    occupancy is about 50% year round and he knows from the local tourist office that

    the other properties average around 68% occupancy year round. New developments

    could mean trouble. This lack of occupancy can be quite frustrating for Mr Smith.

    Cars pull in, drive around the parking areas, then drive away.

Currently Mr Smith does very little advertising in local district guides and the holiday

    papers, mainly because he really thinks word-of-mouth is the best form of

    advertising. He is a member of the local tourist committee, but too busy to go to

    meetings. However, he does receive the local statistics and knows the average stay

    in the area is 3.8 nights, and that local families and couples and increasingly

    overseas visitors are his potential customers.

    He’s not desperate yet, but he’s getting worried and disillusioned. He thought he would be overrun with guests, but that hasn’t happened.

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SWOT analysis of the Sweet Dreams Motel

Compare your analysis with the following points:

    Strengths: Weaknesses:

? Located in a popular tourist region ? No television (crucial for the

    ? Big rooms family market) ? Large grounds and open areas ? Bare and unappealing grounds ? Breakfast service to rooms ? Initial interest by people who ? Good restaurants and take-away drive in and look but then leave

    nearby (probably because of the bare

    ? Low prices (but this is also a grounds)

    problem!) ? Location poor in relation to other

    ? Regular customers (but not very services, attractions, etc.

    many) ? No separate restaurant services ? Membership in the local tourist ? Low occupancy compared to other

    group motels

    ? Property large enough for coach ? Very little advertising

    groups ? Only local advertising ? Property is clean ? Uninspiring motel name ? Access to information about the ? Low rates being charged could be

    industry perceived as unappealing ? Mr smith acknowledges he has a

    problem the first step towards

    solving it!

    Opportunities: Threats:

    ? Install televisions immediately ? Potential failure if occupancy

    ? Landscape the grounds and make doesn’t improve

    them more attractive ? Potential failure if other properties

    ? Add more outdoor facilities begin cutting rates

    playground, BBQ facilities, ? Potential problems if other

    perhaps a pool or tennis courts properties begin big promotional

    depending on finances campaigns ? Increase the level of advertising ? Potential problems if more budget

    ? Increase the rates being charged motels are built ? Work in with other attractions,

    restaurants, etc (charge-back

    facilities with nearby restaurants,

    for example)

    ? Attend tourist group meetings

    do more networking

    ? Add own restaurant or do-it-

    yourself catering facilities for

    guests

    ? Investigate other markets

    (backpackers, etc.)

Mr Smith’s most important action is to raise rates immediately. At less than half the

    price of other motels his price is too low which conveys a poor image. This combined

    with the bare grounds, may be driving potential customers away. His rates can still

    be low, but should be comparable to the rates of competitive properties.

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