Group members

 ABDUS SAMAD
 MUHAMMAD IBRAHIM
 GHAZANFAR
 RAZ MUHAMMAD
Short History

 Mr. Byram Avari built his first hotel in 1944.

 In 1978 he made a Hotel in Lahore and gave
its contract to Hilton for 20 years.
 In 1984 he opened Avari Towers in Karachi
and also decided that he should retake his
hotel in Lahore.
 After a long lawsuit in 1987, he was finally
able to terminate the contract with Hilton
and retake the management of his Hotel at
Lahore.
 In 1988, the hotel is faced with a tough
competitive situation against Pearl.
Contemporary Issues of
Hospitality Industry
 Shortage of skilled Human Resources.
 Shortage of Marketing Knowledge.
 Inadequate Customer Relationship Management.
 Shortage of Capital.
 Technology and Social Media.
 Increasing/Decreasing Demand.
 Increasing Customer Expectation and
Dissatisfaction.
 Increasing Competition Intensity.
 Quality
Contemporary Issues of Avari
Ramada Hotel, Lahore in 1988

.
 Shortage of skilled Human Resources.
 Shortage of Marketing Knowledge.
 Inadequate Customer Relationship Management.
 Shortage of Capital.
 Technology and Social Media. (Does not apply to 1988)
 Increasing/Decreasing Demand. (Increasing Demand)
 Increasing Customer Expectation and Dissatisfaction.
 Increasing Competition Intensity. (Specifically in Pricing)
 Quality (Not bad but not as good as competitor)
 Strengths & Weaknesses
Strengths:
 Better Location.
 Skilled personnel.
 Detailed customer assessment.
 Good at maintaining relationship long term relationship with
customers.
 Good Promotional activities.
 Variety of service packages.

Weaknesses:
 Rooms not as big or visually good as its competitor.
 Lawns not as big as competitor.
 Brand image not as good as competitor.
 Opportunities & Threats
Opportunities:
 The newly formed Tax free industrial zone. (Increase in
demand due to more business travel).
 Start of flights from US and EU expected to increase business
activity. (More demand)
 Currently one of the few 5 Star Hotels.
 Opportunity for differentiation from competitor.

Threats:
 Pearl Continental was a very strong competitor.
 2 more Five Star Hotels, Sheraton and Holiday Inn to begin
operations soon.
Current Situation at Avari

 Average prices falling below Pearl.

 Focus on getting more business accounts from Pearl.
 Prices to be increased 10% every year.
 Room Occupancy still same on to Pearl on yearly
basis when monthly average is taken into account.

Alternatives:
 Increase all Rates by 10%.
 Increase all rates except EBS and VEBS.
 Introduce a new type of Rate which will bridge
distance between group and individual rate.
Analysis of Alternatives
Alternative 1

Increase all Rates by 10% (Not

recommended)
 Increasing all room prices goes can result
in decreased customers due to higher
price and can reduce occupancy rates.
 Goes against the objective of getting
more business accounts from Pearl.
 Increasing room rates a second time can
have negative impact on image as well
where Avari is already struggling.
Alternative 2

Increase all rates except EBS and VEBS

(Recommended)
 EBS and VEBS accounts are 61% of revenue.
 Will only affect 39% of customers which are
non-business.
 A middle road which can result in some
revenue.
 Does not go against the objective of getting
more business accounts from Pearl. (Does not
affect EBS and VEBS accounts)
Alternative 3

Introduce a new rate to bridge gap between

group and individual rates (Not
recommended)
 Not a permanent solution.
 Makes management more difficult.
 Lessons for General Management
&Superior
Recommendations
Human Resources matter.
 Customer analysis can be a beneficial tool.
 Bargaining with customers depending on business.
 Following up the Customer and relationship management.
 Building product/service quality if you have the resources.
 Building brand image.
 Utilizing all part of your business for revenue (gym,
swimming pools etc)
 Differentiating from your competitor.
 Coming up with Alternatives.
 Product variety
 Promotional Variety.
How has Covid-19 impacted
Pakistan’s hotel industry?

 Pakistan has seen several major economic downturns

since the Afghan-Soviet war in the 1980’s, all which
have impacted the hotel industry particularly hard.
 The 1990’s Nuclear tests, 9/11 and the War on Terror,
the 2008 world economic depression, and now Covid-19,
with the latter being the worst of all these crises, by
far.
  If companies and individuals cannot travel and visit a
hotel, the hotel’s revenues are garroted.
  With flights stopped, there is no inbound travel and no
flight crew staying at airport hotels.
 Hotel gyms and pools have been closed, while
restaurants, banquet and meeting facilities, an integral
part of hotel operations, have been completely
restricted.
 All this has led to a severe strangulation of the revenue
generated by the hotel industry.