Question
This is a bit long. We are debating if the five forces written down are correct or not. Please give me some opinions if we
This is a bit long. We are debating if the five forces written down are correct or not. Please give me some opinions if we should re-write these or keep them. This is about the ivey case Lake Superior Lodge: It's Not Always About "Location, Location, Location."
FIVE FORCES:
- Bargaining Power of Buyers
Breakfast Inclusion and Amenities:
According to Smith Travel Research, price should normally be based on what services and amenities a hotel or lodge can offer to their clients. From exhibit 6 lists of local competitors, only Sheraton Duluth offers a full service facility and that gives them a very low to non bargaining power of buyers. Some on the list may not offer that full service facilities but they include breakfast in the accommodation.
On the other hand, Lake Superior Lodge does not offer a full service amenities and with no breakfast inclusion on their accommodation, because of this kind of set up, there is a very high bargaining power of buyers as clients may still look around to compare rates with what others can offer like in Americinn Lodge & suites for just a small difference of $25 they can enjoy additional facilities plus breakfast or if they want to compare it with Days Inn who includes breakfast on their stays with a much affordable rate of $76 a night.
- Bargaining Power of Suppliers
Location:
Comparing to the location of Macquade Harbor, Lake Superior Lodge is giving a peaceful and exclusive atmosphere that is good for seminars, team building, retreats and other private functions. Given the fact that the lodge has only 15 rooms, you can guarantee that your stay will have a private and personalize experience. Lake Superior Lodge has a high bargaining power as this are the quality of location and ambiance most clients look for after a long and busy schedule, to have a quiet and peaceful room to stay and unwind after a tiring day.
Low occupancy:
Having only 15 rooms in the Lake Superior Lodge is a high bargaining for suppliers as they can guarantee all their clients with parking space even if the lodge will have a full house. The high-speed internet will be reliable at any time without any interruptions because you know that you are going to share it with only few people in the lodge.
- Threat of New Entrants
Source of Clients:
Since Lake Superior Lodge is operating under an independent lodge without branding and that gives them a high threat of new entrants. The negative side managing independent accommodation is the trust you have to earn in every client who shops around for accommodation. Compared to Hampton Inn Dutch, Sheraton Duluth and Americinn Lodge & Suites-Two Harbor they have a level of low to non threat of new entrants because of the brand they carry, it won't be hard for them to get clients as their brand are already known and trusted in the industry.
Booking On Sites:
The Lake Superior Lodge tagline, "We'd love to have you stay with us" has a high to medium level of threat of new entrants because it will be harder for the bookers to search or to reach their site with this tagline. A tagline should always begins with a word that will make your site easily be searched online, like "Clean, Quiet, Experience, Lake, Superior or Affordable, " and other qualities that suit to Lake Superior Lodge.
- Threat of Substitutes
Free Parking and High-Speed Internet:
Based on the exhibit 6, almost all of them offers the same free parking and free internet access. Lake Superior Lodge has a very high threat substitue due to its rate and amenities they offer to their clients. Like for the rate, a client will definitely choose a $76 rate of Days Inn with free parking, free internet, business and fitness center, pet friendly and free breakfast over a $90 rate of Lake Superior Lodge offering just the free parking and high-speed internet and pet friendly rooms.
- Competitive Rivalry
Free Internet and Free Parking:
Free high-speed internet and free parking are two amenities that Lake Superior Lodge offered in competition with other accommodations, but their two main competition would be Voyageur Lakewalk Inn and North Shore Cottages. Competitive rivalry is very high for Voyageur Lakewalk Inn as this accommodation offers the same two amenities with additional breakfast at a rate of $80 per night, a $10 less difference with an additional meal.
Meanwhile, the competition rivalry for North Shore Cottages is low, but still a competition due to the lower rate offered by the Inn, but the same experience at a lower cost of $80.
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