SWOT ANALYSIS ON BAYAN TREE HOLDINGS LIMITED
Banyan Tree Holdings Limited (BTH) is a leading international manager and developer of premium resorts, hotels and spas in the Asia Pacific region, with close to 30 resorts and hotels, over 60 spas and 80 galleries; as well as three golf courses. Of which they still manages and own interests in niche resorts and hotels. Each resort typically has 50 to 100 rooms and commands room rates at high end of each property market. Its primary business is management, development and ownership of resorts and hotels and it is highly involved in the two award-winning brands; Banyan Tree and Angsana. It also operates Laguna Phuket which is a leading integrated resort in Thailand through the Group’s subsidiary, Laguna Resorts & Hotels Public Company Limited. Competitors
BTH is known for its refined product, services and accommodations. But there is an increasing competition with business driven by tourist travel like Banyan Tree; Amara Sanctuary Resort Sentosa provides a tranquil environment for their guests. Although it is not well known in spa treatment, it provides an excellent service for tourists who are visiting Sentosa. The direct competitors of BTH are Aman Resorts and Hilton Hotel Group with almost similar offering to customers- luxury integrated resort with spa. An indirect competitor is the upscale hotel, such as Marriott Hotel Inc. and Hilton Hotel Corporation provides an alternative for guests who are looking for not only comfort but price savvy and easily accessible accommodation.
Existing Market Conditions
Most would have thought that the market for the luxury hotels and resorts industries around the world would have plummeted riding on the recession in 2009. However, a study carried out by the “Market Metrix Hospitality Index (MMHI)” (Barsky, 2009) proved that more than half of the respondents worldwide indicated that the recession will not detour their plans for travelling. In fact, companies and business travellers, whom are not the core target market of BTH, are the ones cutting down, or eliminating business travels altogether to cut cost. Apart from which, the market condition is highly determined by the competitors and the intensity of the competition. The key competitors for BTH are the Aman Resorts and Hilton Hotel Group (Conrad). The intensity of rivalry amongst these competitors are relatively high, with almost all groups targeting the same potential market (i.e. currently China and Vietnam) as well as fighting to gain a head-start and strong market position above the competitors. New competitors are finding it difficult to break through into the market to compete due to the high cost involved in starting up and investing in these luxurious resorts. Hence, the barrier of entry is high for potential new entrants.
The market condition will also be affected by the suppliers and buyers of this industry. The supplier in focus will be the travel agencies as these are the people or associations that provide customers with the services to these luxury resorts. The bargaining power of these agencies is high as they have the extensive channels to reach out to the mass public, while many different hotels and resorts will be vying to run their advertisements and promotions through them.
The buyer on the other hand, faces low switching cost should they decide to go with another resort for their travels. This is due to the fact that most luxury resorts provide identical offerings at relatively similar prices. Although customers’ loyalty can be garnered with the experiences provided by the resorts, the minimal differential uniqueness that one party has over the other places each under pressure against the mass buyers
In conclusion, the market condition of luxury resort industry is stable and trending due to the large untapped potential markets especially in the Asia Pacific region.
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