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Impact of External Environment on Business

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This paper will present a general idea about small and medium size enterprises in goods or services. Marriot Hotel in Melbourne is chosen as an example of discussion the following sections. The discussion will cover the following points: a profile and nature of Marriot Hotel, rationale for selecting this hotel, illustration of how changes in external environment factors have impacted on business over the last 5 to 10 years. Also, this paper will examine the environmental forces that are relevant to the business and discuss the rationale behind the environmental forces. Moreover, it presents an outline why other factors and forces may not be relevant to this business. Finally, this paper will identify and discuss the forces that may effect on business over the next decade or so supplemented with a proposed marketing strategy.

Small and medium size enterprises


There is no single definition of a business, or of a firm or enterprise which are often used to mean the same thing. Generally, it means a legal unit, person or group of people producing goods or services under their own control and with their own legal identity. A branch or office of a larger organisation is not in itself a business.

There are many definitions of a small and medium sized enterprise. However, the best to be found is the European Union definition. They define a small enterprise as one with under 50 employees, and a medium enterprise as one with at least 50 but under 250 employees.

Characteristics of small and medium-sized enterprises

Small and medium-sized enterprises are characterized as:

• Sole proprietorships, run by one self-employed person;

• Partnerships run by two or more people; and

• Companies in which the working directors, are counted as employees.

Role of small and medium-sized enterprises

Small and medium-sized enterprises (SMEs) take the role as majority of companies in most countries, and are also a major engine of job creation. Unfortunately, many SME owners and managers are concerned, mostly due to the lack of appropriate information, that is implementing environmental measures in their companies requires significant investment, and that they will not obtain an adequate return on their investment.

Lovelock et al (2001) argue, “…the Internet will revolutionise the processes of international marketing, its greatest impact may be for SMEs (small- and medium-sized enterprises)”. They cited Quelch and Klein (1996) and said, ‘…competitive advantages of economies of scale (for large organisations) will be diminished, advertising costs will be lower and small niche marketers will find enough customers globally via the Internet’. Moreover, Lovelock et al (2001) have indicated, “It will be, in effect, a low-cost gateway to global markets for SMEs” .

Profile and nature of Marriot Hotel


Melbourne Marriott is an AAA Five-Diamond boutique hotel situated in the centre of the theatre, shopping, and business districts, approximately 14 miles from Melbourne International Airport. Local attractions Botanical Gardens, Crown Casino & Entertainment Complex, Luna Park, Melbourne Aquarium, National Gallery of Victoria, and Telstra Dome.

Melbourne Marriott hotel boutique

The boutique Melbourne Marriott Hotel exceeds the expectations of today's business, leisure and meeting guest with warm, friendly service, comfortable and stylish decor along with Marriott's world-renowned spirit to serve. Boutique in size, but grand in style the hotel boasts 185 spacious guests rooms and suites, dedicated executive services, superior meeting and event facilities with wireless Internet access and contemporary dining.

Services provided

The hotel provides services such as mini bar, laundry service,restaurant,24-hour room service, television, bureau de change, parking, safe deposit, bar, computer facilities, Internet access, swimming pool, disabled access, business facilities, childcare facilities, air conditioning, non-smoking rooms, fitness

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