SWOT Analysis of Intercontinental Hotels Group Plc

ABSTRACT This is an all-embracing assay on bazaar assets of Intercontinental Hotels Accumulation Plc., a all-around hotels aggregation ranked at position 72 in the FTSE 100 basis at the abutting of business on March 2nd 2012. It is a absolute assay of its strengths and weaknesses in action and operations, threats in its business environment, accepted and approaching opportunities for advance both financially and in its market. INTRODUCTION Intercontinental Hotels Accumulation Plc. (IHG) is a all-around hotels aggregation headquartered in Denham, United Kingdom (Datamonitor 2007). It is complex in ownership, management, leasing or franchising hotels and resorts, through subsidiaries about the apple with 4,480 hotels in about 100 countries and territories (Datamonitor 2007). Its brands accommodate Crowne plaza, Holiday Inn, InterContinental and Staybridge Suites. Listed at the London Stock Exchange (LSE) with a accessory advertisement at the New York Stock Exchange (NSE), IHG is ranked 72nd in the FTSE 100 basis with a bazaar assets of ?3.4bn at the end of 2011 (FTSE basis address 2012). The aggregation operates a assorted portfolio of brands beyond assorted bread-and-butter segments which baby for assorted amount segments from the high flush (5-star) articulation absorption on the all-embracing business traveler, to the flush (4-star) articulation accouterment both to the business adventurer and the leisure adventurer bottomward to the midscale (3-star) targeting both calm business and leisure travelers (Annual address 2010). It makes best of its money from ability fees of franchises and administration fees from the hotels it manages. IHG provides ability in auberge management, systems, and business abrogation advance in acreage to its ally as it is far added basic intensive. This “asset-light” operating anatomy enables the Accumulation to accomplish beneath of its basic in development and aliment its hotels. It alone owns a baby cardinal of hotels it deems important strategically to its brands. A above backbone for IHG is its adopted brands with its all-inclusive portfolio advantageous administration in their bazaar segments (Annual address 2010). Affection account from these brands strengthen the bazaar position of IHG giving it its aggressive bend as it seeks to booty advantage of accretion business and leisure biking globally. The accumulation is additionally agog to abound new avant-garde brands that accommodated the different adventures guests desire. It has anew launched the EVEN hotels brand, the aboriginal boilerplate auberge absorption on wellness agog to booty advantage of the advance in the wellness area globally (IHG 2011). This cast fulfills a appeal for convalescent biking by abnormally accouterment solutions for all aspects of traveler’s wellness needs in the areas of exercise, food, assignment and rest. Additionally, its re-launch of its Holiday Inn cast focused on affection and bendability for a bigger chump acquaintance shows the company’s focus to convalescent its brands. With these, IHG is accession itself to account from added chump numbers and their appeal for specialty services. IHG’s adapted bounded attendance reduces risks associated with operating in a accurate arena due to adverse geo-political, bread-and-butter altitude as able-bodied as appeal fluctuations. The Accumulation is demography advantage of abeyant advance opportunities that alternative regions action and is advance in amplification in these arising markets such as China. Advance in these new markets counters slump in acceptable markets such as the Euro area which is experiencing bread-and-butter and political challenges affecting travel. Furthermore, attendance in extensive areas of its day-tripper resorts and getaways additionally differentiates it from its competitors who mainly focus on above cities. This gives the aggregation an added acquirement beck with added to action to the chump in agreement of assorted locations and experiences. The Group’s all-around systems and calibration is additionally its backbone with it advantageous administration positions in 13 of the top 20 markets about the apple accounting for over 80% of all-around abode absorb (IHG 2011). Its hotels are strategically positioned to account from the bazaar segments and attributes of biking in the regions. For instance, the articulation in the US with the greatest allotment is the midscale and IHG’s Holiday Inn cast ancestors is the better in this segment. The aggregation is gluttonous to enhance its attendance with added apartment in added locations through its activity with authorization agreements and signing of added apartment (hotels) to the group’s portfolio (IHG 2011). The Accumulation additionally boasts of an avant-garde web and adaptable attendance mainly focused on online reservations. Its catch arrangement consists of 11 all-around alarm centers and several bounded accent websites authoritative it the best alive on the web in the industry and strategically accession it to account from an access in online anxiety (Annual letters 2010). This approach delivered 19% of apartment acquirement through IHG’s absolute websites in 2011. Additionally of agenda is Priority Club Rewards, the group’s adherence affairs with over 63 actor associates which creates echo cartage and enhances its accord with its audience (IHG 2011). The company’s antithesis area is able-bodied with a 26% advance in operating accumulation from $444m in 2010 to $559m, with acquirement of $1,768m in 2011 up from $1,628m the antecedent year (IHG 2011). These assets acquiesce IHG to advance in accelerated advance deepening its brands with a blurred of its debt. Raising accounts is a claiming globally as it diminishes the net arrangement for growth. As such, IHG has expectations for advance in the arena of 2-3% in 2012. However, perceived as alms greater aegis through catch systems, adherence schemes and all-embracing networks, branded hotels are accepting in bazaar allotment over the unbranded allocation of the industry. This acumen makes it easier for acreage owners to advantage on these brands back gluttonous debt financing. IHG is positioned to accretion from this trend with its affability additional by its action of abundant brands and able acquirement commitment through all-around anxiety channels. Intercontinental hotels accumulation has a weakness in its bounded concentration. The auberge and accommodation industry admitting burst is still geographically absolutely concentrated with the top 20 countries accepting over 80% of the world’s apartment and the US accounting for 25% of that (IHG 2011). Over bisected of IHG’s acquirement comes from the Americas, accounting for 69% of the Group’s operating accumulation (IHG 2011). This ample acknowledgment to the US bazaar makes IHG accessible in the accident of a recession. However, accepting abiding administration and authorization affairs for best of its hotels makes IHG beneath accessible than its competition. Its focus on growing its attendance in arising markets and globally additionally seeks to adverse such vulnerability with about-face of acquirement sources. CONCLUSION The backbone of IHG’s brands, bolstered by their all-around systems and calibration enables the aggregation to accomplish able-bodied in the US and Greater China, key all-around markets. With its advised attack at deepening its business through developing its cast portfolio accurate by targeted investment. IHG ensures that it allowances from opportunities accessible in its business ambiance in animosity of ample ambiguity in the Euro area and the Americas. IHG is appetite to position itself globally to account from opportunities in industry trends in the continued term, in particular, arising markets with growing appeal and specialty. This it is enabled by its adopted brands, geographic diversity, able-bodied antithesis area and its scalable business model. APPENDIX Revenue per accessible allowance (RevPAR) – allowance acquirement disconnected by the cardinal of allowance nights that are accessible (can be mathematically acquired from control amount assorted by boilerplate allowance rate). Occupancy Amount – apartment active by auberge guests, bidding as a allotment of apartment that are available. Pipeline – signed/executed agreements, including franchises and administration contracts, for hotels which will access the InterContinental Hotels arrangement at a approaching date. REFERENCES Annual report, 2010. InterContinental Hotels Accumulation PLC . {Viewed on 5th March 2012} from http://www.annualreports.com/Company/2353 Datamonitor, 2007. Intercontinental Hotels Accumulation Plc. {viewed on 3rd March 2012} from www.datamonitor.com FTSE Basis report, 2012. FTSE All-Share Basis Ranking (unofficial guide) as at abutting on Fri, 2 March 2012. {Viewed on 3rd March 2012} from http://www.stockchallenge.co.uk/ftse.php Intercontinental Hotels Accumulation Plc. (IHG), 2011. Preliminary after-effects 2011- twelve months to 31 December 2011. {Viewed on 3rd March 2012} from http://www.ihgplc.com/index.

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