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Marriott Hotels - Montenegro

International Business
by

Christopher Deleon

on 18 June 2015

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Transcript of Marriott Hotels - Montenegro

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by Christopher Deleon, Alejandra Carrillo, Kassy Patel, and Vianey Barraza
Company Identification
Reasons for going International
Montenegr0
Bay of Kotor, Montenegro
Strategic Analysis
Successful History of Foreign Integration
4,000+ Destinations, 78 Countries, 19 Hotel Brands

Take advantage of growing markets
high tourist countries (like Montenegro)
Increase Profits and Revenue
more tourists = more customers

Growing tourist industry on coastal cities
10% tourism growth per year
Population:
650,036 people
47.1% ages 25 -54 (median age 39.2)
Language: Montenegrin (aka Serbian)
Currency: Euros
Wages:
$3.39 average per hour, $5,724 per year
$1.48 minimum per hour, $3,088 per year

Location & Politics
Topography
Climate
Natural Resources
Montenegro is located between Serbia, Italy, Greece and Bulgaria. (neighbors, capital, political & trade relations)
Mostly covered in mountains
long flat coastline (260 km long)
techtonically active area, earthquake 1979 destroyed infrastructure cities along Adriatic Sea (will need insurance on buildings)

Mediterranean Climate
long, warm summers (80 F) & mild winters
Colder and more humid on mountains

4 Elements of Geography
Advantage of Nations,
Diamond Model
Globalization Forces
(PEST Model)
Hofstede's Value Dimensions
Global Corporate Form
SWOT Analysis
Strategy Implementation
Strategic Plan
Entry Points &
Strategic Sustainability
Core Competency
Serbia + Montenegro made up the Republic of Yugoslavia
Left State Union of Serbia and Montenegro in 2006, declared independence

Foreign relations
Stable, democratic, multiethnic country
Shares values between itself & surrounding European countries
believes in equal partnership and mutual respect with other countries
Development since Independence
2007
- Joined Northern Atlantic Alliance (NATO)
guarantees stability and security
improves economic development
demonstrates democracy is stable
- Signed Central European Free Trade Agreement
- Joined International Monetary Fund and the World Bank
2012
- Became a member of World Trade Organization
Currently
- In process of joining European Union

Tourist Sites
Main source of economic development
2012, visited by 1.4million tourists, 700 euros in revenue
directly & indirectly generated 17-23% of GDP
contributes 17.6% of jobs (29,000)
Tourism industry expected continue to increase
by 2023, 31.8% employment (59,000)
Energy
72% energy from fossil fuels (42% coal, 30% oil derivatives)
15% renewable resources (hydrolic power and biomass)
13% imported from other countries
Other Natural Resources
Bauxite
Used to produce Aluminum metals
Mines located in central Montenegro
Lead-Zinc Ore
used for batteries, paint, and some ammunition
located on mountain area of Ljubišnja and Bjelasica
Award Winning Customer Service


Hotel Philosophy
"Take care of your employees and they'll take care of your customers
"

Service Model for Success
1. Have a happy staff
2. Focus on innovation
3. Establish high business standards

Power Distance (PD)
Individualism (IDV)
Masculinity (MAS)
Uncertainty Avoidance Index (UAI)
Long Term Orientation (LTO)

Enter the market early

Use cheap labor to create infrastructure

Buy out local competitors that can’t compete with an international company

Dominate market share and spread brand name recognition

Be well established for when international competitors move in


Brief History
1983-1988
1993-2011
2013-Current
1957-1969
1927-1953
First Hotel & First International Hotel
1957: Twin Bridges Marriott Motor Hotel
365 rooms
largest in the nation
Marriott International
1993: Marriott International becomes its own company

1995-98 Acquires the Ritz-Carlston and Renaissance Hotel & Launches Town Place Suites and Springhill Suites is launched

2011: AC Hotels debut (luxury brand)

2012: Arnie Sorenson = CEO & President


Moxy Hotels & New Technology
First entry to lower economy tier
aimed for younger travelers
A&W Root Beer Stand & Hot Stoppes
1927 A&W Root beer stand
J. Willard & Alice Marriott
Became Hot Stoppes
drive - in
public company
Courtyard, Fairfield Inn, Residence Inn
1983: Courtyard for business lodging

1987: Fairfield Inn & Marriott Suites Hotels debut & Residence Inn is acquired
porfolio with different brands
Factor Conditions
The minimum wage for employees in Montenegro start at a yearly rate of EU 3,456=$3, 383,57 dollars in America
In Montenegro there is total of 117 different beaches, giving locals a great access to fresh fish that wil be used in Resort resturant
Demand Conditions
More of a toursist demand than local markets
Related Industries
Hotel over booking
Use other food industries around us and collaborate deals, expanding our Marriott Rewards program
Firm Strategy and Rivalry
American company doing business in Montenegro is seen positively as their government sees the potential of foreign investors
Owner has rights to 100% of the company
Montenegro goverment encourages foreign markets
Foreign Direct Investment

Montenegro allows foreigners to own property
Treat foreign business as a citizen under the same tax rates

Goal
Have the largest market share in hotel industry in Montenegro

Red Coat Direct App
Travel Brillantly Campaign
Marriott Rewards
1969: Acapulco Paraiso Marriott
Types:
business travelers
young travelers: millenialls

International:
Europe
Asia Pacific
Middle East
Africa
Current Market
Current Operations
*3,800 Hotels in 72 Countries
18 brands
6 categories
Luxury
Lifestyle/Collections
Signature
Modern Essentials
Extended Stay
Destination
Political
Tourist economy is expected to increase revenue in 10 years by 2 billion dollars
Economy
Socioculture
Language
Gender Roles
Technological
Not as quick construction and infrastructure
Full transcript