Banff Aspen Lodge Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Banff Aspen Lodge Case Study Help

Suggestive Alternatives

In order to maintain its competitive position, revenue stream and profitability; the company can use its vacant space in the following ways.However, each alternative has its own pro and cons:

Opening Café:

One of the suggestive alternative to the company is to utilize the vacant space of gift shop by opening a small café. The pros and cons of opening a café are as follows:

Pros:

Because Aspen’s is located at the prime location of Banff Avenue and Moose Street, so it would be the convenient place for tourists and local residents to stop and enjoy cup of coffee or a light brunch. The café will also serve to the guests of hotel. Due to a good reputation of the hotel in consumers’ mind, it would be expected that more and more customers would come to the café. If Aspen’s would turn the gift shop into a small and cozy café then the company would be able to enhance the experience of the guests through additional offers. Furthermore, the café would help the company to generate high revenue, because the coffee industry is experiencing high growth and it is expected that the growth will continue in future.

Cons:

The café would face a stiff competition from the existing competitors of the market,such as: Wild Flour Bakery, Banff’s “artisan bakery café,” and franchises, such as: Starbucks and Evelyn’s Coffee Bar. The company would require an additional investment for the replacement of gift shop into a small café. The company would only be able to serve only 20 customer at a time. Furthermore, the company can only offer limited variety to its customers due to the limited space.

Opening a Restaurant:

Another considerable alternative is to open a restaurant. The pros and cons of opening a restaurant are as follows:

Pros:

Opening a restaurant would provide value added services to the guests, who currently enjoy a good breakfast buffet each morning but go to neighboring hotels or downtown restaurants for lunch and dinner. The hotel would be able to serve dinner and lunch to its hotel guests as well as local residents of the city at one place. Due to the prime location of the hotel, it would attract and serve more customers.

Cons:

For the restaurant, the company would require additional and full time chefs and cooks, which would ultimately increase the company’s overhead cost. For the restaurant, the company would also require an additional management staff or waiters who would serve the customers. The restaurant can also face a strong competition from the existing competitors in the market. High startup cost as well as license approval would be required. Limited space is also one of the constraints for opening a restaurant. Another massive constraint is that in order to open a restaurant the company would have to reduce the size of existing breakfast room, which would have an adverse impact on the free breakfast buffet that currently helps Aspen to differentiate itself, and it would also require a high capital investment for the restaurant to be operated within the Hotel.

Develop the Hotel’s Market and Focus on Its Core Service Offerings:

Another alternative is that the company should use its vacant space by the closure of the gift shopand turning the space into a second lounge area for the guests, so that it could be able to tap the new market and develop relationship within China and other target markets.

Pros:

By turning the vacant space into a second lounge, the hotel would be able to focus on its core offerings. By doing so, the hotel would be able to provide its services to an additional and current market more efficiently. This approachmightbethebestwaytoachievefor Aspen to achieve its goalofpositioningitselfasthepremiermid- scale resort property in Banff, in an industry where competition is always expected to remain intense. The company would generate high profit margins in comparison to all the alternatives as well as enhances the experience of the customers by focusing on its current core competencies. The hotel would be able to serve more customers at the one time. Additionally, the company would focus on its core competencies, which would helpit to maintain its competitive edge in the industry.

Cons:

This option would not allow the company to provide value added services to its customers. Minimal capital investment is required to turn the gift shop into a second lounge. An additional work force is required to covert the gift shop into a lobby. It would also require an additional capital investment.

Recommendation

On the basis of internal, external and the available alternatives, it is recommended that the company should implement the third alternative, which is developing the hotel market through converting the gift shop into a second lobby. However, the opening of the café on the vacant space of gift shop is also an attractive alternative because it would enable the company to provide value added service to the customer, but due to an intense competition and the dominant players in the market, the company would have to take a significant amount of time to maintain its footholds in the market.The company can also be faced with the chances of failure in attracting the new customer base to its café. Due to the less chances of success, it is recommended that the company should focus on its core offerings, would help the company to focus on its core competencies and enable it to tap the new markets for its existing offers or services.Pursuing new markets, such as China, and maintaining the staff’s focus on the customer’s experience at the hotel is the much-suitable way of growing Aspen’s main source of revenue for the future. Furthermore, converting the gift shop into lobby would allow the company to maintain its competitive edge over its rival hotel companies, and it wouldalso provide long term as well as short term benefits and improve the revenue stream of the company.

Implementation

In order to implement the third alternative, the company should conduct a meeting to design a team which would be responsible to handle all the activities regarding the conversion of gift shop into second lobby. The responsibilities should be divided into different team member in such a way that each team member would be responsible for different activities. In the meeting, the team should plan that how they can change the structure of gift shop to convert it into lobby, planning of the resources, available budget and the time required to complete the work. If it is possible then the company should use the material of the gift shop in decorating the lobby, otherwise scrap the material of gift shop. One of the team member should purchase the required décor material for the lobby in order to make it look more attractive to the clients or guests..................................

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