Introduction
Syuen Company is company that started off as a small construction company and then invested in hotel range business and build Syuen Hotel. Syuen Hotel manages operating industry gives customer service satisfaction in the hotel. This group has been founded for the past 19 years. Mr. Yan, who owns the hotel use to be always a tailor and almost all of his marketplace was big photographs. A lot of the customers of Mr. Yan were the politicians; business man and people connect to royalty bloodstream. As his business grew he began a small structure business with the contact and effect of his network with the politicians and business people. Then he began to do housing project and development in a small scale and then developed to big engineering development Company. Syuen Hotel was billed by his own structure company and that is where he began his hotel range business.
As Mr. Yan's business grew, he began to spend money on other countries by buying lands and building hotels. Mr. Yan opened up the next hotel in Laos and started to develop the united states to an improved and much more civilized country. As times handed down by Mr. Yan also invested in timber business and tea plantations. Mr. Yan remaining the management to Miss Maggie Ong to control Syuen Hotel. Neglect Maggie is the director of the hotel and she used all her skills, network and skills to bring up the standard of the hotel. Now Syuen Hotel is also called the best city hotel in Ipoh.
Laos is a single-party socialist republic. The administrative centre city is Vientiane. Other large cities include LuangHYPERLINK "http://en. wikipedia. org/wiki/Luang_Prabang" HYPERLINK "http://en. wikipedia. org/wiki/Luang_Prabang"Prabang, Savannakhet, and Pakse. The state terminology is Lao. Laos is a multiethnic country with the politically and culturally dominating Lao people creating approximately 60 % of the populace, mostly in the lowlands. Various Mon-Khmer communities, the Hmong, and other indigenous hill tribes, accounting for forty percent of the populace, live in the foothills and mountains. Laos' "strategy for development is based on making electricity from its rivers and selling the power to its neighbours", specifically Thailand, China, and Vietnam. Laos is virtually an inexpensive country as isn't that civilized and developed compare abroad in this era. Their country development is way very good behind then compare to other countries. Laos is the one landlocked country in Southeast Asia, and its own thickly forested landscaping consists mostly of durable mountains. The highest which is PhouHYPERLINK "http://en. wikipedia. org/wiki/Phou_Bia" HYPERLINK "http://en. wikipedia. org/wiki/Phou_Bia"Bia at 2, 818 meters (9, 245 ft), with some plains and plateaus. Local tradition holds that we now have three months (rainy, wintry and hot) as the second option 8 weeks of the climatologically described dried up season are noticeably hotter than the earlier four weeks. Laos has a very good quality soil that truly helps on agriculture activities. Subsistence agriculture still makes up about 50 percent of the GDP and provides 80% of occupation. Only 4. 01% of the country is arable land, and only 0. 34% used as long term crop land. The cheapest percentage in the Greater Mekong Sub region and grain dominates agriculture, with about 80% of the arable land area used for growing grain. Subsistence agriculture is self-sufficiency farming where the farmers concentrate on growing enough food to supply themselves and their own families. The typical subsistence plantation has a variety of plants and pets needed by the family to give food to and clothe themselves during the yr. The labor cost at Laos is very cheap as the majority of the individuals don't brain doing any hard job to make money and make it through there.
After observing all the pros and cons of Laos, Mr. Yan decided to commit at Laos and expend his hotel lines business and make use of the advantages in Laos. Mr Yan practically used all the experience and recourses that he have from Malaysia and transfer to Laos to develop the business in Laos. He centered on mainly on hotel collection business and then he invested also spent on tea, herbal remedies, parrot nest and solid wood art furniture. Syuen Firm established another corporation name called Dansavanh hotel group representing Syuen Corporation in Malaysia. In 1997 the Malaysian Syuen Corporation started to develop Laos's greatest holiday resort on more than 18000 hectar of national recreation area land on island in the reservoir behind the Nam Ngum dam. Among the company's first function is to set up a found mill to process the timber logged from the development area (Dhirendra K. , 2001). Then they build the first hotel called the Nam Ngum Holiday resort and then accompanied by the Vientiane Hotel. Syuen Corporation signed master contract with the Laos's authorities on 6 January 2006 and open Nam Ngum Vacation resort which is the first eco travel and leisure resort. These hotels improved upon the travel and leisure of Laos as it captivated folks from other countries which eventually increased the currency exchange. Besides that, Syuen Corporation opened tea manufacturing company and timber production company over time. The theory is to create good quality tea and wood build furniture with low labor cost and export to countries like Malaysia, Thailand, Cambodia and Vietnam with good price. This helped the business to earn good earnings as they export quality material with an improved price then other rivals.
Analysis
Gain
Grow opportunity
It may sound basic, but it is undeniable as this is one of the primary known reasons for company to get to another country. The Syuen Company owner senses the opportunities offered in the country, thus moved early to enter the market. Back in 1997, the business already began to develop the most significant resort in Laos (Dhirendra K. , 2001). Fast onward to today, the come back are stunning, the organization now own a resort with driver and casino, a 4-legend hotel and two more hotels in development (Dansavanh Hotel, n. d. ). The rise in variety of vacationer in Laos lately has boosted the tourism industry in the united states, especially hospitality industry.
The hotel lines business in Laos benefited greatly from the development of tourism as the hotels are concentrating on upscale travellers, which are 12% from millions of traveller to Laos. Moreover, the hotel also offer travel and leisure program at their hotel as addition to their growing earnings and capitalize on the tourism style in Laos, where the government declared 2012 to be Visit Laos Time. Apart from that, the corporation hotel in Malaysia also provide tourism bundle that destination will Laos which include accommodation in their own hotel. The move to invest in a different country gained the business variety in their business and also development in term of quantity market dished up.
Low labor cost
Laos remain among the country that the labor cost are relatively low. Syuen Corporation ventured in to the country and loves low cost in term of income, and allows these to have higher profit percentage. The reduced cost condition not only benefited the hotel business collection, but also the Corporation's tea plantation and timber build furniture business. despite the low priced of labor in the united states, Syuen Firm still face little competition as the risk of new entrance are extremely low, as Laos placed 163 overall in "Simple CONDUCTING BUSINESS" rank out of 185 economies(THE GLOBE Bank, 2012). The company gain advantage of the first mover advantages as they are one of the very most early company to create sawmill and furniture manufacturing in the united states. They also continue to be as few of the company from Malaysia to take pleasure from the low cost advantages.
Synergy from diverse business
The low labor cost also encouraged the company to venture into different market sectors, apart from their main hotel collection business, as mentioned in the release part of the assignment. The majority of their business in other market sectors synergized well with the main business. For an instantaneous, the Corporation involvements in tea plantation and wood craft furniture industry in the country also donate to their hotel businesses. High quality tea are produced to be used in the hotel and also export, this reduce the cost of getting tea thus increases the profit margin of the Corporation. Similarly, the almost all of the furniture in the hotel are hardwood art furniture of their own. This in turn saves the cost of setting up hotels in Laos, and the tea and furniture gain free vulnerability and advertising to vacationer. Furthermore, the tea and furniture are also exported to Malaysia, and the organization hotel can enter a minimal price set alongside the selling price. The synergy created is effective with their businesses.
Shortcoming
Lao Authorities Forest Policy
According to J&C Expat Service, if want to start out a company in Laos can be quite challenging because Laos is known as one of the most difficult countries on the planet in starting a company (J&C, 2012). Therefore, Syuen Organization is facing few shortcomings when entering Laos to increase their business. First and foremost, the physical location of Laos is included in many mountains, plains and plateaus. You will discover over 70% of Laos contains rainforests (Globalaware. org). Therefore, deforestation is the major effect on Laos which also indirectly have an effect on Syuen Corporation business at Laos especially the timber and sawmill business. Syuen Company create sawmills to process the timber logged from the development area (World Rainforest Movements and Forest Screen 1998, 53). Environmentally friendly problems that experienced by Laos especially deforestation gets more serious as widening commercial exploitation of the forest and programs for more hydroelectric facilities. Thus, in order to maintain valuable hardwoods for commercial removal and protect the forest environment, Lao federal decided to set quota logging. Besides, your choice of setting the amount of quotas is intricate and no transparency. Initially, the province will submit a body to the Ministry of Agriculture and Forestry (MAF). The results will be transferring through many ministries and your choice is made without any consultation with representatives from the Department of Inventory and Planning in the Section of Forestry (Vajpeyi, 2001; Southavilay and Castren 1999). Then, MAF will show the quota between your provinces and most of the provinces will get quota considerably below the timber handling capacity in that province (Vajpeyi, 2001). Therefore, Syuen Corporation's sawmills business will be damaged the most because of the quota logging arranged by the Lao federal.
Infrastructure low
Laos is an underdeveloped country, the indegent access, short of infrastructure and many undeveloped destination are restricting the growth of the hotel and tourism industry in the town. There are just 5 airlines serve the Wattay AIRPORT TERMINAL, from regional cities such as Bangkok, Hanoi, Kuala Lumpur and Phnom Penh. (Horwathhtl. com, 2011)Therefore, to gain access to to the town of Laos is not a lot of. Thus, the inconvenience of access potential in Laos will impact the hospitality business of Syuen Company. Furthermore, Laos is facing the obstacles of building Internet connectivity because of the insufficient skills and resources. THE WEB connection in Laos is a sluggish process which suggested by the low levels of PC penetration and poor telecommunications network (Thongvilu and Houphanh, 1996). Although major cities are linked in Laos, positioning a call between towns is often difficult. Such inconvenience and lack of infrastructure might have an impact on the performance of Syuen Firm business in Laos especially hotel business of Syuen. As the web connection service is low, the managerial section of Syuen Organization at Laos will be influenced and reduce the efficiency of the employees. In addition, customers might have bad experience with the Wi-fi service provided by the Syuen Firm hotels in Laos.
Education level and health service low
The education level at Laos is much less high as other developed countries, the standard quality of the post-secondary college not high so they lack of professionalism and reliability and skill labor. This will affect employees' performance of Syuen Company. Besides, the medical services at Laos very limited and low standard, causing the event of morbidity is high and this will led to the reluctant of vacationers come to Lao. Regarding to Prof. Dr. Somboune Phomtavong, Prof. Dr. Kongsap Akkhavong and Dr. Somchanh Xaisida (2005) the lack of clean normal water, poor sanitation, inadequate nourishment and limited gain access to health services are aggravating factors, which effect morbidity, particularly in rural areas. Moreover, low quality local mentors, educators and trainers in public areas health management programs. Furthermore, the acquiring research and technology skills are limited because of the low degree of the essential education and spanish knowledge. Other than that, Lao Authorities requires that a company may have up to 10% of its employees as foreigners if those foreigners are unskilled, or up to 20% if they're skilled. In all cases, they need to get acceptance from federal government in their work. The company must obtain permission from government in order to increase the percentage of overseas workers it utilizes (Jclao. com, 2012).
Recommendations
Send for training and implement training programs
One of the shortcomings that working business in Laos is the training degree of this country is low. A lot of the Laos people aren't skillful and experienced. They are lack of knowledge to handle the highly skill tasks. So Syuen Organization can send the unskilled personnel and staff who insufficient experience to the Syuen Firm hotel in Laos (Vientiane Hotel and Nam Ngum Holiday resort) in order to learn how to execute all the jobs. For example, master how to clean the visitor rooms, how to communicate properly with friends, how to approach the reservation and 1 on 1 business calls. Following the Laos workers learnt how to perform the responsibilities, they can improve their performance. Besides that, the business also provides some training programs for those unskilled Laos individuals. One of the illustrations can be British Language training curriculum. The Syuen Company can offer British language training program to make certain that all the employees can understand and speaking the British language fluently. This program is important for the personnel because almost all of the hotel income gain is from the overseas tourists. So it is important for the workers to understand and speak English language fluently anticipated to English language is the International Vocabulary. After their English skills advanced, their performance can also be better. The staff can increased in capacity to respond to questions or requests and provide assistance in English or ability to take part in 1-on-1 business calls in English. Once the employees' performance was upgraded, the customer satisfaction will observe to improve. And it will affect the business reputation and revenue. Finally it can maintain and strengthen the company competitive advantages.
There has a successful case an firm can improve its performance by applied the English language training program. The business is Hilton International Incorporate. With a generally English-speaking customer foundation that demands the highest level of quality and service, Hilton needed a worldwide technique for building the business English communication skills of its employees to help deliver on its brand guarantee. After careful evaluation, Hilton integrated the GlobalEnglish Corporate Learning Service (currently known as GlobalEnglish Advantage) on an internationally basis and has came to the realization significant production and performance advancements (GlobalEnglish, 2011). Furthermore, there also an effective case that the business sends the employee for training can improve the staff performance. SCA Company let the worker to wait a 2 week training curriculum at one of SCA's Western european offices in Gothenburg, Sweden. This program was loaded with meetings and service tours with groups from product categories, R&D, sourcing and company development. The employee said that she could quickly find out about SCA's businesses, products and marketplaces across the world, and align itself with the global platforms and practices within a short while (Vivian B. , 2009).
Joint venture with Air travel Company
By getting a hotel within an underdeveloped country with less than resources and infrastructure, it makes tourists having difficulties in seeking the hotel itself, as mentioned before, there are only five airlines that serve the Wattay Airport, finding the way to the hotel from the air-port itself can be challenging and inconvenient to most of the foreign tourists, not saying exploring the location without any assistance and information from a trusted source can be worrying. Insurance agencies above problem, Syuen is recommended to consider an agreement of joint venture with one of the airlines in order to fulfill customer more by providing a package of services to them, starts off from the airlines, allow customers to travel to Laos, and picking up guests from the airports and in to the hotel and return, it's rather a joint ventures of the hotel itself or create a whole new set or package deal of services and provide it to the holidaymakers, providing all travelling and head to guiding services that they in a position to enjoy after they disembark of their planes and get there Laos. Along with the helps from the airlines partner, this action in a position to further satisfy more visitors, making sure they have a safer quest within the time they spent in Laos, letting them to truly have a more convenient and comfortable voyage. Alternatively, by having this group of services, it in a position to convince and get more potential prospects, by introduce the assistance to them, as browsing an undeveloped country is actually regarded as unsafe and high-risk by most of the foreigners, a safe and comfortable trip is always the primary concern in travelling.
The scenario of the joint venture agreement between an air travel and a hotel is seen in the Shanghai AIRPORT TERMINAL Hotel, as it is a joint venture enterprise by Chinese language Eastern Air, that they offers a free shuttle bus to and from Shanghai Pudong AIRPORT TERMINAL and the Shanghai AIRPORT TERMINAL hotel mentioned. Within the hotel lobby and all the guestrooms, the journey activity will be show through a monitor for every visitor to keep an eye on their trip information. Along with the Shanghai AIRPORT TERMINAL hotel also provides air solution scheduling services and multiple location trip check-in services in the lobby (Sinohotel, n. d. ).
However, it continues to be recommended that Syuen Hotel should offer more services in terms of travelling, guiding, compared to Shanghai AIRPORT TERMINAL Hotel, and put customers safe practices at the first place as the hotel is located in Laos which commonly regarded as undeveloped and unsafe by the outsiders, to ensure all the friends have a nice journey, and securing Syuen's competitive advantages. While the labor cost in Laos is relatively low as stated previously, Syuen is expected to be able to conduct this course of action with ease while enjoying low priced advantage.
Enhance Relationship with Laos Government
From previously discussed, Syuen Corporation's sawmills business have been affected because of the quota logging established by the Laos Administration. In order to package with this hazard, it is crucial for Syuen Corporation's to keep up a good or positive marriage with the Laos Authorities senior officials such as personnel from "Kong kouat ka Sapha-nyakone Pa Mai" as known as Forest Inspection Department (FID) in order to have more quotas on logging the woods and advocate the mature officials to reach the illegal logging activities inside the united states. However, it is difficult for Syuen Corporation's to do so because Laos Government senior officers do not necessarily trust on the logging companies due to the risk of sacrificing important administrative positions for inappropriately to approving logging businesses as has happened to some senior government officials before. Thus, Syuen Corporation's can deal with senior officials alongside the other trusted administration officials, ones who are able to act as guarantor or give guarantee that nothing at all improper will took place in order to gain confident and trust from the Laos Federal government senior officials. Moreover, Syuen Corporation's may offer benefit sharing predicated on the patron customer relation to the Laos Federal may in term of economic or others showing the sincerities and loyalties of the company toward the Laos Government.
Search for logging quota alternative
Besides of normal logging quota, Syuen Corporation's can seek out special logging quotas that offer by the Laos Administration as alternative. One of the examples of the special logging quotas can be use by the Syuen Corporation's is deadwood logging quotas (quota mai leep lem) which allow Syuen Corporation's to acquire trees which already are dead such as located deceased tree (Deadwood) from wherever area they can be within forest without limitation (Baird, 2010). This will allow Syuen Corporation's have significantly more woods and materials to support the company sawmill's business besides of normal logging quota. In season 2007, a logging quota of "deadwood" was given by the Champasak Province in southwestern Laos to Development of Agriculture and Forestry Business Company (DAFI) for the rosewood and the quota didn't specify the quantity to be trim and the logging site (Baird, 2010).
Conclusion
A few years back, Syuen Corporation main business is within Malaysia hotel industry, as they continue steadily to grow, their business into Laos have gained them market share in 2 different countries. Their first mover advantages in Laos are still firm, as the united states remain a difficult spot to go for new business. Furthermore, their investment in Laos including the tea plantation and sawmill business synergized well with the main business. However there remain some shortcomings in Laos, like the government forest policy which limit the expansion of sawmill business of Syuen Organization, and also low infrastructure level, education level and medical service.
Therefore, we've come out with 4 tips to counter the shortcoming and enhance the company competitive advantages. We advised staff to be Send for training and execute training programs, joint venture with Flight Company, enhance relationship with Laos's government, and lastly seek out logging quota solution. As the alternative are proven to be practical, because they are either applied by other company or support by journal articles, hopefully that the recommendation will be carried out and help the business.
