The Environment State Of Economy Tourism Essay

At the average clip, Malaysia is non making good in its economic system due to the downswing of both planetary fabrication and services in June. Anyhow, research worker provinces that major economic sectors of Malaysia are expected to turn at slow gait in 2012. Malaysia service sector besides got affected due to the downswing of planetary services. This can be proven by the informations provided by JPMorgan Global Services Business Activity Index where the service end product enlargement was the weakest in the recent three twelvemonth growing period. Nevertheless, service sector is expected to go on play a critical function in conveying up the economic system of Malaysia ( Suzy, 2012 ) . Although, the economic system is non really encouraging but as mentioned, service sector such as hotel industry is expected to convey up the economic system since touristry industry has been developing. Tourists from other states may still hold the disbursement power to go to Malaysia since our currency is lower and therefore more low-cost for foreign tourers to pass in our state.

Furthermore, Malayan Government will subsidise those 4-5 star evaluation hotel by supplying them some benefits such as revenue enhancement freedom and allowances. This is because Malayan Government wants to advance touristry which in the terminal will better tourer reachings and tourer grosss particularly in concern and medical touristry. The ground being is that these tourers are largely high-yield visitants ( Ng, 2012 ) and this will better the concerns in the hotel industry.

Current tendencies

Technology plays functions in assorted industries which included touristry. Internet linking people around the universe and enhances the sharing of information. Online travel sites are supplying people more ways to research for approaching holidaies. Online air-ticket engagement offered by assorted air hoses such as Air Asia, Malaysia Airline, Firefly and so on aid travellers to book air hose tickets 24/7. In add-on, societal networking sites like Facebook, Twitter and web logs allow visitants to portion paths and trips information with household, friends and other travellers ( Richard & A ; Kelli, 2008 ) .

Table 1: Tourist reachings and grosss to Malaysia.

Beginning: Tourist reachings and grosss to Malaysia. ( n.d. ) . Research. Retrieved from hypertext transfer protocol: // page=facts_figures

From the statistic above, we can see that Malaysia is acquiring more and more tourist reachings. It is a good mark where people around the universe are acquiring familiar with Malaysia.

In add-on, study shows that Malaysia domestic touristry is chiefly influenced by season such as school vacations, public vacations, festivals jubilations and so on. Therefore, terminal of the twelvemonth is ever the extremum season for Malayan to go about. The clip domestic visitant spend on a trip is mean 2.45 yearss due to the high outgo. From the study, we can see that sing relations and friends ( 75.6 % ) are the chief intent for most of the Malaysian to see or go to a topographic point ( “ Tourist Arrivals, ” n.d. ) .

Current political values and tendencies

Malaysia is a state that is consists of different types of races such as Malayans, Chinese, Indians and others which aroused the wonder of aliens to come and see Malaysia in order to understand the assorted civilizations originated from different races ( “ Colours of 1Malaysia, ” 2011 ) . So, Ministry of Tourism has organized a batch of events such as Fabulous Food 1Malaysia, Sport Tourism, Colours of 1Malaysia, Student Tourism Programme and so forth. For illustration, Colours of 1Malaysia that is being launched since twelvemonth 1999 and for Colorss of 1Malaysia 2012, this event is expected to pull about 100,000 witnesss which include both local and aliens ( “ Colours of 1Malaysia 2012, ” 2012 ) . This event has brought 293 travel agents to take part and the aggressive development move for touristry industry done by Ministry of Tourism will besides impact the hotel industry as the development of touristry industry can advance the related substructure like hotel and therefore increase the net incomes for hotel when there are a batch of tourers sing Malaysia which means the sum of clients for hotel companies will increase besides ( “ About MITE 2012, ” n.d. ) .

However, although attempts are being given to pull more tourers, there are besides events that happened in Malaysia which give a intermission for tourers to see Malaysia. For illustration, Bersih mass meeting that happened in Malaysia since twelvemonth 2006 which holding the aim to reform the electoral system in Malaysia as the political parties such as NGOs and civil society groups accused the electoral system which is under Prime Minister Department to be unjust and therefore they held the mass meeting that holding a hope to hold a clean and just election. However, Bersih rally held will impact the touristry industry ( “ Rationally- Bersih 3.0 is a Failure, ” 2012 ) as tourers will afraid of their safety, so during Bersih rally, there will be less tourers sing Malaysia. For illustration, on April 28, Bersih 3.0 mass meeting had created negative impact on touristry industry and this had resulted in a batch cancellation of circuit bundles. Furthermore, the touristry ministry besides being informed that there are about RM 200,000 hotel reserves being cancelled last minute ( “ Bersih Rally Jeopardises Tourism Industry, ” 2012 ) . This mass meeting has earnestly affected the touristry industry in Malaysia and therefore causes a terrible impact on hotel industry when there a enormous lessening in the sum of tourers.

On the other manus, Malaysia is implementing Lynas undertaking where this rare refinery works will be built in a peat swamp country that is located 3.5 kilometer to the South China Sea and this will earnestly impact the supply of seafood and the popular touristry topographic point ( Boyle, 2012 ) . This undertaking is expected to hold negative impact on the touristry industry as this works will do Malayan to be populating in a radiation taint state and do the Earth pollution. This disadvantage cause will earnestly impact the touristry industry as tourer will be afraid of the radiation in Malaysia and they will non pay visit to state that pollute the Earth and this will do negative word-of-mouth for Malaysia and the touristry industry will be negatively affected. Therefore, the hotels in Malaysia will be negatively affected excessively.

Potential Threats and Opportunities

No uncertainty, engineerings nowadays ease people day-to-day life. Business field decidedly is one of the good industries because some utile information that might assist the concern to travel good can be obtained easy through the World Wide Web free-of-charge. However, this can be a menace to innovative concern ventures at the same clip because scribe can merely copy their advanced thoughts ( Hong, 2009 ) . It will be worse when more progress engineerings such as choping system is invented. The ground being is that informations will be easier to acquire exposed to hacker in future with the aid of progress engineering system ( Baker, 2011 ) .

Besides, economic system impacts the universe greatly. The stableness of the economic system is critical factor for outward touristry as it will impact tourers ‘ income ( Becken, 2011 ) . Unemployment rate decidedly will increase and GDP will diminish due to economic crisis. Thus, economic crisis is a menace to all concerns because it is unexpected and leaves great negative impact in many industries ( Leymon, 2012 ) . In add-on, it causes Malaysians overwhelmed by hapless buying power. This is because our currency is acquiring weak as the side consequence of the economic downswing ( Lee, Yow & A ; Melissa, 2011 ) .

Malaysia is a state that comprises of many different races citizens such as Malayans, Chinese, Indians, Kadazans, Ibans and so on. This can be the ground why tourers visit our state because they wanted to larn about our civilization. So, Malaysia authorities spends 1000000s ringgit to convey up the Malaysia touristry industry. Programs brought by Tourism Malaysia such as Magic of Night Boat Parade Putrajaya 2012 had attracted many foreign tourers to pay a visit to Malaysia ( David, 2012 ) . The increasing reaching of tourer to Malaysia is a good mark for assorted concerns in Malaysia because tourers ‘ disbursement provides the locals with more concerns and incomes. This may excite entrepreneurial chances for Malaysia such as selling local handcrafts as one type of concerns that can be developed in the touristry industry. Besides, hotel industry besides benefits from his because tourers will hold the demand for adjustments. In short, touristry industry stimulates the economic system of a state ( Harcombe, 1999 ) . This so becomes an chance to a state ‘s economic system every bit good as concerns.

B. The Industry

Regalodge Hotel is surely involved in the hotel industry. In this industry, service is indispensable and non to state about the installations and comfortable status of the suites in the hotel itself. Cozy environment is largely what clients seek for when they want to happen a topographic point to remain particularly during holidaies. There are few types of adjustments in this industry such budget hotels, hotel and flats, hotels and resorts and so on. The few illustrations of them are Excelsior Hotel, Heritage Hotel, DWJ Hotel, Impiana Hotels and Resorts, Gallic Hotel, Tower Regency Hotel and Apartments and Kinta Riverfront Hotel and Suites. So, it is non an easy undertaking for a hotel to vie and last since there are legion strong rivals in this industry even though it is merely in a little metropolis, Ipoh.

The rivals can be divided into direct and indirect rivals. The direct rivals are the hotels that provide similar type of adjustments and installations as what Regalodge Hotel provides to its clients. The few direct rivals of Regalodge Hotel are Gallic Hotel, Heritage Hotel and Lost World Hotel. On the other manus, the indirect rivals may be those hotels that provide rather different types of adjustments and installations such as budget hotels, hotels that have flats and resorts and so on. Few illustrations of indirect rivals of Regalodge Hotel would be Tower Regency Hotel and Apartments, Impiana Hotels and Resorts and Kinta Riverfront Hotel and Suites.

Recently, there are rather a figure of new entrants or new rivals in the hotel industry in Ipoh metropolis itself. Due to the lifting figure of tourers and events or occasions held in Ipoh, there are a batch of new hotels built to run into the demand of the possible clients. Few new rivals of Regalodge Hotel are Mh Hotel, Tune Hotel and Kinta Riverfront Hotel and Suites.

Porter ‘s Five Forces

1. Rivalry among existing houses

Number of rivals

The figure of rivals in hotel industry is high because Malaysia is spread outing touristry industry and the delightful nutrient in Ipoh are able to pull a batch of tourers to see Ipoh. The illustrations of rivals are Tower Regency, Tune Hotel, D Eastern Hotel, Hotel Excelsior, Lost World Hotel and many more. Therefore, figure of rivals rises due to adjustments demand and this lead to the intense competition in hotel industry and the attraction of hotel industry will besides increase.

Fixed costs

Besides, hotel industry besides has high fixed cost as bring forthing a hotel concern need a batch of capital in order to do it successful ( “ Operating Leverage, n.d. ) . Harmonizing to Pavlatos and Paggios ( 2007 ) a hotel has about three quarters of entire costs that is fixed and can non be controlled. High fixed cost will cut down the attraction of an industry ( “ Industry Attractiveness ” , n.d. ) . As the fixed cost is high, this will do the cost of issue barrier in the hotel industry to be high. The cost of issue barriers is high because a man of affairs or enterpriser will hold to give up the high investing invested into the hotel if they wanted to go out the industry ( Enz, 2009 ) . So, it is hard for a hotel to retreat from the industry due to the high fixed cost and a man of affairs will non desire to bear with the losingss caused by fixed cost when the hotel issue from the industry.

Therefore, we can reason that big sum of rivals, high fixed costs and high cost of go outing barrier cause a high grade of competition.

2. Menace of new entrants

Capital demand

Hotels need high fixed costs particularly for ornament and eating house rewards ; whereas high variable costs are needed for nutrient and drinks ( Pavlotos & A ; Paggios, 2007 ) . The high fixed costs and variable costs will set a intermission for new entrants to come in hotel industry, so Regalodge Hotel will be less threaten by new entrants.

Economies of graduated table

In add-on, high economic systems of graduated table are needed in this industry. In order to come in the hotel industry, new entrants need to guarantee that they have high economic systems of graduated table so that they will hold the ability to vie with those established hotels. The new entrants have to vie with the major rivals in footings of quality and monetary value. High economic systems of graduated tables decrease the attraction of the industry and lower the menace of new entrants.

Merchandise distinction

If a new entrant wants to come in the industry, merchandise distinction is besides another important factor so that they can vie with the established company. For illustration, Regalodge Hotel has differentiated itself by holding a good repute and first-class service for the clients. As service is an of import standard in the hotel industry, new entrant must do certain that they will be able to supply good services to be competitory.

So, it can be seen that high capital demand, high demand of economic systems of graduated table and demand for merchandise distinction cause low menace of new entrants.

3. Menace of replacement merchandises

Number of replacements available

There are a batch of close replacement ‘s merchandises for hotel such as motel, homestay, places of relations, friends and familiarities.

Substitute ‘s monetary value value

Besides, the monetary value value of remaining in hotel is much higher comparison to remaining in relations ‘ or friends ‘ house. So, this will do hotel to be a less considered adjustment option.

Switch overing costs

The shift costs of purchaser is besides low since there are a batch of stopping point replacements which may hold lower monetary value compared to other replacement in the hotel industry. The replacement merchandises have threatened hotel industry, therefore, cut down the industry ‘s attraction.

Based on the legion replacements that is available, lower monetary value value of the replacements and low shift costs of purchasers, the menace of replacement is somewhat high.

4. Dickering power of providers

Number of providers

There are rather legion sums of providers for hotel industry. Hotel industry needs a batch of providers in footings of preparation services, nutrient and drinks and many more. These providers can be easy found in the market particularly for nutrient and drinks. Therefore, the bargaining power of provider is lower.

Switch overing costs

In add-on, the exchanging cost in the hotel industry is low as the hotels can easy exchange to the providers they want without incurring much costs, so the hotels will hold higher dickering power than providers.

Based on the big Numberss of providers and low provider exchanging cost, the bargaining power of the providers is lower than the hotel ‘s.

5. Dickering power of purchasers

Number of purchasers

There are a batch of purchasers in hotel industry. Although, the purchasers are little in size, there will be a important influence if a hotel loses a client because regular clients of hotel industry are normally little in size. So, the purchasers would hold a small higher dickering power than the hotel.

Switch overing cost

Furthermore, the exchanging cost of the purchasers is low as there are a batch of rivals in the market and clients can exchange to the rivals really easy. So, the industry will be less attractive for the ground being.

Contribution to quality

Extra installations normally added in hotel industry in order to increase the quality of services provided to clients. For illustration, eating house, watering place, karaoke Centre and reflexology Centres are extra installations provided for clients. Therefore, the part of quality bends to be high with those added installations. So, clients will be given non to exchange to competitor ‘s hotel.

The smaller sum of purchasers, lower shift costs and high part to quality will do the bargaining power of purchasers to be moderate.

In the nutshell, it can be seen that through the Porter Five forces analysis, there are high competition among existing houses and moderate menace of replacements and bargaining of purchaser but there are low menace of new entrants and besides low dickering power of providers. These made the hotel industry reasonably attractive.

C. Organization

Regalodge Hotel is a 3 star evaluation hotel which is handily located in the bosom of the Ipoh metropolis. It was established since twelvemonth 1996. The hotel has a sum of 86 suites which 8 of them are suite suites. Below is the organisation construction of the hotel.

The hotel has about 35 employees including the direction squad. The mark market of the hotel is business communities and tourers since most of the ground why people stay in a hotel in Ipoh is either for the ground of going or making concern. The hotel able to derive a sum of RM100, 000 to RM120, 000 gross per month.

The most important ground why the hotel is making rather good as a 3 star hotel is because the installations and services that they provided to their clients. Regalodge Hotel is known as a 3 star hotel with 5 star services. With all the good services and friendly employees, clients feel that they are being valued and appreciated.

The hotel has six types of suites which include criterion, superior, gilded, executive, Regal suite and Regal household suite suites. The suites ranged from RM100 to RM300, which is the monetary value scope of a 3 star hotel.

Besides, the hotel has a few attractive installations such as the Limestone mulct dining eating house, Regal watering place and reflexology Centre. Overall, comparing to the same criterion and star evaluation hotels in Ipoh metropolis, Regalodge Hotel can be considered the best pick of a sensible priced-hotel with high criterion of service which comes together with first-class installations.

D. The Marketing Strategy

Aim of Marketing Strategy

There are a few of marketing schemes that had been used by Regalodge Hotel where the two chief schemes are to hold the right mark market and implement suited publicities. The selling scheme for Regalodge Hotel is to aim on the right market. The aim of this selling scheme is to run into and fulfill clients ‘ demands and wants by utilizing their strengths and capablenesss. The location of Regalodge Hotel is at the bosom of Ipoh metropolis, so, they claim that they are the indulge Eden in a bougainvillea metropolis by offering several sorts of merchandises and services to run into different client ‘s demands and wants. On the other manus, the intent of Regalodge Hotel put to deathing a few publicity bundles as their selling scheme is to pull more clients, increase their trade name name and besides to remain survive in the extremely competitory industry.

Target Market

The mark market for Regalodge Hotel is business communities and leisure travellers. This is because Regalodge Hotel has a strategic location which is near to Numberss of concern Centre, shopping Centre, and touristry locations. It is more convenient for the business communities to make the concern Centre while the leisure travellers can see shopping Centres and topographic points with cultural attractive force easy. The mark market can even make their desire finish via public conveyances that are available near to the hotel. Besides, all right dining eating house, watering place and reflexology Centres are available in the hotel to supply better installations to the mark market. These extra installations enable them to let go of their working emphasis and have a comfy environment while passing their clip in Regalodge Hotel.

Competitive Advantage

The services provided by Regalodge Hotel are superior comparison to other rivals. The staffs in the hotel provide a good quality service to clients in order to please and fulfill the clients in order to be more competitory in this extremely competitory industry. For illustration, umbrellas will be provided to clients during showery yearss and clients will be accompanied by peculiar staff to the auto park to acquire their autos. The direction in Regalodge Hotel believes that good services and affection that people feel in their household can be done by the hotel through the little inside informations in day-to-day life. Another illustration can be seen through the subsidy of parking voucher for the clients as they park their autos near the hotel compound. The clients need non worry about the insufficient auto park job and utilize their ain money to pay for the auto park.

Besides that, the bites and drinks such as imbibing H2O, java, can imbibe, choice morsels, cup noodles and french friess are all free of charge for clients. Merely Regalodge Hotel is offering these free bites and drinks to their clients and by merely this small complimentary goods offered, it may be one of the ground why people prefer remaining this hotel comparing to others.

Merchandises / Servicess

Hotel industry is the industry that provides merchandise and services. The merchandise of Regalodge Hotel is their hotel suites which are divided into 6 types. There are standard suites, superior suites, deluxe suites, executive suite, Regal suite, and Regal household suite. The hotel has a sum of 86 guest suites. Besides, they besides provides added-value merchandise such like French nouveau culinary art mulct dining eating house, Regal Spa, and Relaxation Reflexology Centre to pull more client with more added services.

As mentioned earlier, hotel besides provides services besides supplying adjustment for clients. When clients step into the hotel, they will be welcomed heartily by the friendly front-line employees that will supply check-in services, replying enquiries and other services to them. Besides, cleaning suites and fulfilling client ‘s demand in a short period is besides type of service that a hotel should hold to function its clients right. Laundry service, room-service and other basic services besides will be provided. Other than that, added-value services such as well-trained Chinese masseur is hired to supply services for Chinese medical pes bath and mending therapy is besides provided. For the all right dining eating house in the hotel, Chef Erwin vande Ve gte, a qualified and certified Culinary Master Chef from Europe is hired to supply clients with high quality nutrient. Adding to the added-value services, hot Jacuzzi pool accompanied by a cool refreshing pool, fittingness equipments, steam and sweat room, and many more are besides available for the hotel ‘s clients.

Promotion Mix

Regalodge Hotel had launched 3 types of particular publicity which valid from 1st January 2012 to 31st December 2012 to pull more clients. These 3 particular publicities are Regal Sunday @ RM124.00 nett, Regal Early Bird Special, and Regal 3 Days 2 Nights Lost World of Tambun Package.

For Regal Sunday @ RM124.00 nett publicity bundle, it is available on Sunday which is used to pull client to pass their weekends remaining in hotel in order to work out the job of fewer concern or client reaching on Sundays. It is because based on the information obtained from the interview done ; the mark market for Regalodge Hotel is business communities. So, they face hapless gross revenues public presentation in weekends since salesmen do non work on weekends. This publicity bundle includes one dark adjustment in superior or standard room and one watering place verifier, which can be used to bask the services in Regalodge Reflexology and Regal Spa.

Besides, Regalodge Hotel besides offered Regal Early Bird Special publicity bundle to honor those clients who make early engagement for the hotel suites. Equally long as room engagement is made one month in progress, client can bask farther price reduction regardless there is weekends or public vacations.

Following, Imperial 3 yearss 2 darks Lost World of Tambun bundle is another publicity bundle offered by Regalodge Hotel. The hotel had cooperated with Lost World of Tambun, which is the largest H2O subject park in Ipoh to offer this valuable bundle for their mark market which is leisure travellers. By buying this publicity bundle, client can bask 2 darks ‘ adjustment in standard room, superior room, or Regal household suite, conveyance to and fro the hotel to The Lost World of Tambun and this bundle besides includes the entryway ticket for The Lost World of Tambun. Regalodge Hotel has been utilizing this publicity to aim those household travellers in order to hike their gross revenues.

Pricing Scheme

Regalodge Hotel is utilizing merchandise line pricing as its pricing scheme. There are several types of adjustment in the hotel such as Superior Room- RM139, Standard Room- RM139, Deluxe Room- RM186, Executive Suite- RM238, Regal Suite- RM276, Regal Family Suite- RM308. These different monetary values of adjustments allow Regalodge Hotel to aim on different sections. Consumers can choose the suites based on their budget or demand for adjustments.

Problems and Options to Solve Problems

Problem 1: Lack of parking tonss

a-? Options:

1 ) Build more parking tonss to supply convenience to clients

2 ) Provide subsidies for parking to clients

a-? Restriction:

1 ) High cost and clip consuming

2 ) Bear with the parking voucher costs

a-? Best option:

-Provide subsidies for parking

Problem 2: Lesser clients on Sunday

a-? Options:

1 ) Give publicities

2 ) Collaborate with touristry bureau

a-? Restriction:

1 ) Reduce net income border

2 ) Give committees for touristry bureau

a-? Best option:

-Collaborate with touristry bureau

Problem 3: Lack of employees

a-? Options:

1 ) Increase employee ‘s benefits

2 ) Require overtime

3 ) Involve in socially responsible activities

a-? Restriction:

1 ) Reduce gross

2 ) Overtime is an disadvantage for long term

3 ) High cost

Problem 4: Weak trade name name

a-? Options:

1 ) Use advertisement and samariums selling

2 ) Provide good services and installations

3 ) Involve in socially responsible activities

a-? Restriction:

1 ) Reduce net income border

2 ) Lack of infinite to construct extra installations

3 ) High cost

SWOT Analysis


Superior client services provided

Merely hotel in Ipoh provide Reflexology Centre installation

First hotel in Ipoh have all right dining- Limestone ‘s all right dining

Soft drink, choice morsels for hotel invitees are free-of-charge

One of the strength of Regalodge Hotel is that they ever provide superior quality services to their clients. It is because they believe that, a service industry like hotel industry, services are of import to heighten their concern. These good services will be value-added, when it comes along with good merchandise, such as hotel suites and installations. In the hotel industry, they are the first hotel that provides reflexology Centre services and all right dining eating houses in Ipoh. So, it can be considered the strength for Regalodge Hotel. In add-on, it has provided complimentary bites and drinks for their clients which their rivals are non supplying. Soft drinks and choice morsels for invitees are free-of-charge where these will be charged in other hotels. It will be one of the factors that increase the trueness of the clients.


Lack of parking slots

Low trade name consciousness

Lack of employees

The infinite in Regalodge Hotel is non every bit large as other rivals in Ipoh, so, Regalodge Hotel has deficiency of topographic point to function as parking slots for their clients, which may do incommodiousness for them. Besides, Regalodge Hotel has low trade name consciousness in Ipoh and non to state in other provinces or states when compared to other rivals such as Heritage hotel, Tower Regency Hotel and others. So, tourers might non cognize about Regalodge Hotel as there are Numberss of rivals and this may do the hotel to lose their clients and have less chance. Last, the information obtained from the interview stated that Regalodge Hotel has ever faces the job about lacking of employees.


Malaysia developing touristry industry

Attractions in Malaya

International events held in Ipoh

Malaysia authorities has put a batch of attempt in developing touristry industry in Malaysia to pull more tourers to see Malaysia. So, the development of touristry industry will be an chance for Regalodge Hotel since Ipoh is consider as a province that has a batch of attractive forces. For illustration, limestone, historical topographic point, delightful local nutrient and so on has attracted a figure of tourers to our state. In the average clip, Ipoh has besides been the topographic point for some international events yearly. For illustration, in November 2012, there will be a World Amateur Inter Team Golf Championship ( WAITGC ) held in Ipoh. Hence, these will make the chances for Regalodge Hotel.


Increasing figure of rivals

Guest house replace hotel as an option

Tourists presents prefer to remain in invitee house instead than hotel because it is more low-cost. So, the Numberss of guest house in Ipoh are increasing enormously, while the Numberss of rivals for Regalodge Hotel besides increased. For illustration, Tune Hotel which is a budget hotel had entered the Ipoh hotel industry during the terminal of twelvemonth 2011. This has been a great menace to Regalodge Hotel as this hotel is new and charged at a lower rate. The increasing Numberss of rivals is a menace for the hotel as it is losing its clients.