Case Analysis of Banyan Tree

CaseAnalysis of Banyan Tree


1)Sometimes an experiential brand surpasses its main aim ofproviding goods or services as depicted from Banyan Tree. Through it,the experience and expected outcome of a brand can be realizedthrough customers’ emotions and also desire for the product onceagain. This means despite consumers benefiting regarding functionalvalues the experiential brand also aims at satisfying theiremotional values.

Whenon holidays, Banyan customers are offered with other services apartfrom just comfort zones to stay. For example, the hotel has atropical garden spa that basically serves as an important asset indelivering the experience of a brand.

Banyantree also tends to focus on CSR campaign as their reliable strategyin building a brand. Through this, customers can have a good image oftheir brand hence attracting them more. The consequence of this actis that the hotel tends to realize high profits from its customers.

2)The plan to expand the Banyan Tree hotel to other locations is basedon a wide range of factors. They include the ability to achieve highprofits in relation to the costs to be incurred, the place should beeasily accessible so as to gain more customers, there should be theavailability of large market demand for the goods and services theyare offering and also the availability of infrastructures in thelocation.

Regardlessof having the best criteria for selecting the location for theexpansion plan, the Banyan Tree is still subjected to a quite rangeof risks. They include:

Lackof political stability

Thiscould affect the profitability of the Banyan tree in the long runhence hindering it from achieving the set goals and objectives. Agood example is the Thailand market where lack of political stabilityhas greatly instilled fear among tourists hence reduced foreignincomes from the tourism sector.


Banyantree tends to suffer from a wide range of challenges as a result ofworking from a different location. These challenges are brought aboutas a result of people having different cultures, different attitudestowards work and different believe. For the Banyan to realize itsgoals and objectives in such environment, it is up to them tounderstand the cultural environment so as they can train theiremployees on how to work as per required by the organization.

Everyprofit-making enterprise tends to face risks. This does not mean theyare completely uncontrollable. My argument as per the Banyan tree isthat the risks the firm is exposed to can be achieved through properallocation of the investments to cater for the fluctuations and alsoengage in business diversification in different locations.

3)From the context of the Banyan tree, it is evident that there is acontinuous increase in the number of tourists visiting the hotel thehotel from 1995 to 2005. However, activities such as terrorism thatoccurred in 2001 and the tsunami of 2004 had a great impact on theeconomy which resulted to affecting the firm’s financial position.Moreover, its expansion plan in Asia also influenced its financesgreatly.

Thegeneral conclusion of the financial analysis of the Banyan tree isthat there was a fluctuation between 2002 and 2004 and profitrealization between 2000 and 2005. This drastic fluctuation wascaused by the occurrence of the tsunami in 2004.

Incomesfor the firm mainly come from the sale of properties and investments.

Therecommendations to the Banyan include

Strengtheningof the Asian market

Itis clearly depicted that Asia has a wide market for the goods andservices offered by the Banyan hence they should strive to gain acompetitive advantage regardless of the availability of harshcompetition. This will in turn help them to realize high profits.

Introducebranches in Africa

Theyshould also introduce their branches in Africa because it has a fastgrowth in the tourism industry.