To: Executive Team

You have been tasked with running a hotel in Thailand - to bring it back to its previous profit levels after a worldwide epidemic, economic problems in the region etc.

Your first task is to decide which hotel you would prefer to run. You will then bid at an auction.

Before the auction you can learn more about the region, the hotels and other details.

Hai Fong, Thailand

Hai Fong is a Thai resort just to the south of Kom Phi - a large manufacturing city with a thriving business and financial centre. The small airport limits the number of visitors, but with the large-scale development of a new airport at Kom Phi, just 40km away, there will be big changes in the next few years.

The potential of a glorious coastline of beaches is being recognised for the first time. Tourists and package deals have increased dramatically. The indigenous wildlife (baboons, elephants etc) are very popular and the ancient sites and temples are a magnet for visitors seeking new experiences. The wonderful climate and the warm seas have attracted holidaymakers from around the globe. You recognise the business opportunity and have decided to exploit it. Your aim is to maximise profits.

You will run a hotel in the area. All hotels have the same profit potential and all have 100 rooms. None currently has a restaurant – just a breakfast area. Typical rooms cost between $40 and $100 per night.

Area map

1. Tourists

   Visitors include young people, backpackers and retired people, but few children. On the whole tourists are looking for a low-price accommodation. Convenience is important and they tend to spend a lot of the time out of their hotel sightseeing.

2. Holiday-makers

   Many couples and families. 'Value for money' is important though they are influenced by the ambiance of the hotel where they spend a fair amount of their time. They predominantly use the beach but also go on excursions.

3. Business people

   The priority for this market sector is quality and choice. They expect a total-quality hotel - and staff. They are generally covered by company expenses and so money is less of an issue. From time to time they take a break to visit local sights and beaches in order to relax.

Site A is a high quality, comfortable
hotel with great business facilities.

Perfect for families, Site B is a really
great mid-range hotel for most.

Site C is located on the main beach
of and is a solid medium-sized option.

Those looking for economy will love
Site D, with easy access to the town.

Typically, your budget will be between $8,000 and $16,000 per quarter, depending on
which hotel you have secured.

Minimum permanent staffing is as follows:

How much will you pay your permanent staff? Average salaries are between $14,000 and $28,000 per annum.

N.B. On the decisions form, enter the quarterly cost for just ONE member of staff.
E.g. if you are paying 15 staff an annual wage of $20,000 each, enter $5,000.

1. Service staff
   Level 1

   Per room sold, per night

   $38

2. Service staff
   Level 2

   Per room sold, per night

   $28

3. Service staff
   Level 3

   Per room sold, per night

   $22

1. Name for your hotel
2. Number of permanent staff
3. Staff pay
4. Service level
5. Advertising spend
6. Market research ($500 per competitor)
7. Room price (average per double room)

You will make these decisions each quarter (3 months).
N.B. There are four quarters in a year and 90 days in a quarter.

1. The previous P&L account for your hotel - with comments from a consultant. Available after the auction.
2. Each quarter, with your results, you will receive advice from a 'business guru' Should you take notice - or not?
3. Each quarter you will receive financial results as well as opportunities and threats. Analyse these carefully before making your next set of decisions.